Document:

Exhibit 10.2

 

INDEMNIFICATION AGREEMENT

 

THIS
INDEMNIFICATION AGREEMENT (this “Agreement”), effective as of July 6,
2006, between Western Gas Resources, Inc., a Delaware corporation (the “Company”),
and John F. Chandler (the “Indemnitee”).

 

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

 

WHEREAS,
Indemnitee is an officer of the Company;

 

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

 

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

 

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

 

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

 

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

 

1.             Certain Definitions.

 

(a)           Change in Control:

 

(i)            The
acquisition by any individual, entity or group (within the meaning of Section 12(d) (3) or
13(d) (2) of the Exchange Act (a “Person”) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of
more than thirty-five (35%) percent of either (A) the then outstanding
shares of common stock of the 

 

 

Company (the “Outstanding Common Stock”) or (B) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the “Outstanding
Voting Securities”); provided, however, that for purposes of this
subsection (i), the following acquisitions shall not constitute a Change
in Control: (A) any acquisition by the Company, (B) any acquisition
by any employee benefit plan (or related trust) sponsored or maintained by the
Company or any corporation controlled by the Company, or (C) any
acquisition by any entity pursuant to a transaction which complies with Subsection 1(a)(iii);
or

 

(ii)           Individuals
who, as of the date hereof, constitute the Board of Directors (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the date
hereof whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies
or consents by or on behalf of a person other than the Incumbent Board; or

 

(iii)          Consummation
of a reorganization, merger or consolidation or sale or other disposition of
all or substantially all of the assets of the Company (a “Business Combination”),
in each case, unless, following such Business Combination, (A) all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Common Stock and Outstanding Voting
Securities immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 50% of, respectively, the then outstanding
shares of common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors, as
the case may be, of the entity resulting from such Business Combination
(including, without limitation, a corporation 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) in substantially
the same proportions as their ownership, immediately prior to such Business
Combination of the Outstanding Common Stock and Outstanding Voting Securities,
as the case may be, and (B) no person (excluding any corporation resulting
from such Business Combination or any employee benefit plan (or related trust)
of the Company or such corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 35% or more of, respectively, the
then outstanding shares of common stock of the corporation resulting from such
Business Combination or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that such ownership
existed prior to the Business Combination, and (C) at least a majority of
the members of the board of directors of the corporation resulting from such
Business Combination were members of the Incumbent Board at the 

 

 

time of the execution of the
initial agreement, or of the action of the Incumbent Board providing for such
Business Combination; or

 

(iv)          Approval by
the shareholders of the Company of a complete liquidation or dissolution of the
Company.

 

(b)           Claim:  any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether instituted by the
Company or any other party, that Indemnitee in good faith, believes might lead to the institution
of any such action, suit or proceeding, whether civil, criminal,
administrative, investigative or other, by
reason of any action taken by Indemnitee or of any inaction on Indemnitee’s
part while acting as a director, officer, employee or agent or by reason of the
fact that Indemnitee is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust, limited liability company or other enterprise; in each case
whether or not Indemnitee is acting or serving in any such capacity at the time
any liability or expense is incurred for which indemnification or reimbursement
can be provided under this Agreement; provided that any such action, suit or
proceeding which is brought by Indemnitee against the Company or directors,
officers, employees or agents of the Company shall not be deemed a Claim,
except (i) with respect to actions or proceedings to establish or enforce
a right to indemnify under this Agreement or any other agreement or insurance
policy or under the Company’s Certificate of Incorporation or Bylaws now or
hereafter in effect relating to Claims for Indemnifiable Events (as defined
below), (ii) in specific cases if the Board of Directors has approved the
initiation or bringing of such Claim, or (iii) as otherwise required under
the Delaware General Company Law (“DGCL”), regardless of whether Indemnitee
ultimately is determined to be entitled to such indemnification, advance
expense payment or insurance recovery, as the case may be.

 

(c)           Costs:     all Expenses, judgments, fines, penalties
and amounts paid in settlement (including all interest, assessments and other
charges paid or payable in connection with
or in respect of such Expenses, judgments, fines, penalties or amounts paid in
settlement) related to or arising as a result of any Claim.

 

(d)           Expenses:
shall include, without limitation, attorneys’ fees and all other costs,
expenses and obligations paid or incurred in connection with investigating,
defending, being a witness in or participating in (including on appeal), or
preparing to defend, be a witness in or participate in any Claim relating to
any Indemnifiable Event.

 

(e)           Indemnifiable Event: any
event or occurrence, act or omission to act, related to the fact that
Indemnitee is or was a director, officer, employee, agent or fiduciary of the
Company, or is or was serving at the request of the Company as a director,
officer, employee, trustee, agent or fiduciary of another corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise,
or by reason of anything done or not done by Indemnitee in any such capacity,
including, without limitation, under the
Securities Act of 1933, as amended (the “Securities Act”), the Securities Exchange Act of 1934, as

 

 

amended (the “Exchange Act”) or other federal or state statutory
law or regulation, at common law or otherwise, and which may relate directly or
indirectly to the registration, purchase, sale or ownership of any securities
of the Company or to any fiduciary obligation owed with respect thereto.

 

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

 

(g)           Potential Change in Control: shall be deemed to have occurred if (i) the Company enters
into an agreement, the consummation of which would result in the occurrence of
a Change in Control; (ii) any person (including the Company) publicly
announces an intention to take or to consider taking actions which if
consummated would constitute a Change in Control; or (iii) the Board
adopts a resolution to the effect that, for purposes of this Agreement, a
Potential Change in Control has occurred.

 

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

 

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

 

2.             Basic Indemnification Arrangement.

 

(a)           In the event Indemnitee was, is or becomes
a party to or witness or other participant in, or is threatened to be made a
party to or witness or other participant in, a Claim by reason of (or arising
in part out of) an Indemnifiable Event, the Company shall indemnify, defend and
hold harmless Indemnitee to the fullest extent permitted by law,
even if such indemnification is not specifically authorized by the other
provisions of this Agreement, the Company’s Certificate of Incorporation,
Bylaws or by statute.  In the event of
any change after the date of this Agreement in any applicable law, statute or rule which
expands the right of a Delaware corporation to indemnify a member of its Board
of Directors or an officer, employee, controlling person, agent or fiduciary,
it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement
the greater benefits afforded by such change. 
In the event of any change in any applicable law, statute or rule which
narrows the right of a Delaware corporation to indemnify a member of its Board
of Directors or an officer, employee, agent or fiduciary, such change, to the
extent not otherwise required by such law, statute or rule to be applied
to this Agreement, shall have no effect on this Agreement or the parties’
rights and obligations hereunder.

 

(b)           Notwithstanding the foregoing, the obligations
of the Company under Section 2(a) shall be subject to the condition
that the Reviewing Party shall not have determined (in a written opinion, in
any case in which the Independent 

 

 

Legal
Counsel referred to in Section 4 hereof is involved) that Indemnitee would
not be permitted to be indemnified under applicable law.

 

(c)           If so requested by Indemnitee, the Company
shall advance (within two business days of such request) any and all Expenses
to Indemnitee (an “Expense Advance”). 
Such obligation of the
Company to make an Expense Advance shall be subject to Indemnitee having made
the undertaking in Section 8 and the condition that, if, when and to the
extent that the Reviewing Party determines that Indemnitee would not be
permitted to be so indemnified under applicable law, the Company shall be
entitled to be reimbursed by Indemnitee for all such amounts theretofore paid; provided,
however, that if Indemnitee has commenced or thereafter commences legal
proceedings in a court, of competent jurisdiction to secure a determination
that Indemnitee should be indemnified under applicable law, any determination
made by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee shall not
be required to reimburse the Company for any Expense Advance until a final
judicial determination is made with respect thereto (as to which all rights of
appeal therefrom have been exhausted or lapsed).

 

(d)           If there has not been a Change in Control, the Reviewing Party
shall be selected by the Board of Directors, and if there has been such a
Change in Control, the Reviewing Party shall be the Independent Legal Counsel
referred to in Section 4 hereof.

 

(e)           Any indemnification under this Agreement, other than pursuant to Section 2(c) above,
shall be made no later than 60 days after receipt by the Company of the written
request of Indemnitee, accompanied by substantiating documentation of the Costs
incurred by or for Indemnitee and shall not require evidence that Indemnitee
has previously paid such costs.  If there
has been no determination by the Reviewing Party within 60 days after written
request by Indemnitee or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or in part
under applicable law, Indemnitee shall have the right to commence litigation in
any court in the States of Colorado or Delaware having subject matter
jurisdiction thereof and in which venue is proper seeking an initial determination
by the court or challenging any such determination by the Reviewing Party or
any aspect thereof, including the legal or factual bases therefor, and the
Company hereby consents to service of process and to appear in any such
proceeding. Any determination by the Reviewing Party otherwise shall be
conclusive end binding on the Company and Indemnitee.

 

(f)            Notwithstanding anything else contained herein, in no event shall
Indemnitee be entitled to indemnification under this Agreement for any Claims
that relate to liability: (i) under Section 16(b) of the
Securities Exchange Act of 1934, as amended; (ii) from conduct finally
adjudged as violating federal or state securities laws for “insider trading”; (iii) from
conduct finally adjudged as constituting active or deliberate dishonesty or
willful fraud or illegality; (iv) from conduct finally adjudged as
producing an, unlawful personal benefit to Indemnitee; (v) from any
disgorgement of bonus or other incentive-based or equity based compensation or profits
from the sale of securities as the result of a 

 

 

restatement pursuant to Section 304 of the Sarbanes-Oxley
Act, or (vi) prior to a Change of Control and except to enforce this
Agreement, under any Claim initiated by the Indemnitee unless the Board of
Directors of the Company shall have authorized or consented to such Claim.

 

3.             Contribution. If the indemnification provided for in Section 2
for any reason is held by a court of competent jurisdiction to be unavailable
to an Indemnitee in respect of any losses, claims, damages, expenses or
liabilities referred to therein, then the Company, in lieu of indemnifying
Indemnitee thereunder, shall contribute to the amount paid or payable by
Indemnitee as a result of such losses, claims, damages, expenses or liabilities
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and Indemnitee, or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company and Indemnitee
in connection with the action or inaction which resulted in such losses,
claims, damages, expenses or liabilities, as well as any other relevant
equitable considerations. In connection with the registration of the Company’s
securities, the relative benefits received by the Company and Indemnitee shall
be deemed to be in the same respective proportions that the net proceeds from
the offering (before deducting expenses) received by the Company and the
Indemnitee, in each case as set forth in the table on the cover page of
the applicable prospectus, bear to the aggregate public offering price of the
securities so offered.  The relative
fault of the Company and Indemnitee shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or Indemnitee and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.

 

The Company and
Indemnitee agree that it would not be just and equitable if contribution
pursuant to this Section 3 were determined by pro rata or per capita
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding
paragraph.  In connection with any
registration of the Company’s securities, in no event and notwithstanding the
other provisions of this Section 3 shall an Indemnitee be required to
contribute any amount hereunder in excess of the lesser of (i) that
proportion of the total of such losses, claims, damages or liabilities
indemnified against equal to the proportion of the total securities sold under
such registration statement that is being sold by Indemnitee or (ii) the
proceeds received by Indemnitee from its sale of securities under such
registration statement. No person found guilty of fraudulent misrepresentation
(within the meaning of Section 10(f) of the Securities Act) shall be
entitled to contribution from any person who was not found guilty of such
fraudulent misrepresentation.

 

4.             Change in Control. The Company agrees that if there is a
Change in Control of the Company then with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnity payments and Expense
Advances under this Agreement or any other agreement or Company Bylaw now or
hereafter in; effect relating to Claims for Indemnifiable Events, the Company
shall seek legal advice only from Independent Legal Counsel selected by
Indemnitee and approved by the Company (which approval shall not be
unreasonably withheld). Such counsel, among other things, shall render its
written opinion to the Company and Indemnitee as to whether and to what extent
the Indemnitee would be permitted to be indemnified under applicable law. 

 

 

The
Company agrees to pay the reasonable fees of the Independent Legal Counsel
referred to above and to fully indemnify such counsel against any and all
expenses (including attorneys’, fees, claims, liabilities and damages arising
out of or relating to this Agreement or its engagement pursuant hereto.

 

5.             Establishment of Trust.

 

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

 

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

 

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

 

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

 

6.             Indemnification for Additional Expenses. The Company shall indemnify Indemnitee against any and all
Expenses (including attorneys’ fees) and, if requested by Indemnitee, shall
(within two business days of such request) make an Expense Advance to
Indemnitee, which are incurred by Indemnitee in connection with any action
brought by Indemnitee for (i) indemnification or an Expense Advance by the
Company under this Agreement or any other agreement or Company Bylaw now or
hereafter in effect relating to Claims for Indemnifiable Events and/or (ii) recovery
under any directors’ and officers’ 

 

 

liability insurance policies maintained by
the Company, regardless of’ whether Indemnitee ultimately is determined to be entitled to such
indemnification, Expense Advance or insurance recovery, as the case may be,
unless, as a part of such action, a court of competent jurisdiction over such
action determines that the material assertions made by Indemnitee as a basis
for such action were not made in good faith or were frivolous.

 

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

 

8.             Undertaking by Indemnitee.  Indmenitee hereby
undertakes to repay to the Company any Expense Advance pursuant to Section 2
to the extent that it is ultimately determined that Indemnitee is not entitled
to indemnification in accordance with the provisions of Section 2.

 

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

 

10.           No Presumptions. For
purposes of this Agreement, the termination of any claim, action, suit or
proceeding, by judgment, order, settlement (whether with or without court
approval) or conviction, or upon a plea of nolo contendere, or its equivalent,
shall not create a presumption that Indemnitee did not meet any particular
standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable law. In
addition, neither the failure of the Reviewing Party to have made a
determination as to whether Indemnitee has met any particular standard of
conduct or had any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not mat such standard of conduct or did not
have such belief, prior to the commencement of legal proceedings by Indemnitee
to secure a judicial determination that Indemnitee should be indemnified under
applicable law shall be a defense to Indemnitee’s claim or create a presumption
that Indemnitee has not met any particular standard of conduct or did not have
any particular belief.

 

11.           Nonexclusivity, Etc. The
rights of the Indemnitee hereunder shall be in addition to any other rights
Indemnitee may have under the Company’s Bylaws or the DGCL or otherwise.

 

12.           Liability Insurance.

 

(a)           The
Company hereby covenants and agrees that, so long as the Indemnitee shall
continue to serve as a member of its Board of Directors or an officer,
employee, controlling person, agent or fiduciary of the Company and thereafter
so long as the Indemnitee shall be subject to any possible Claim by reason of
the fact that the 

 

 

Indemnitee was a member of its Board of
Directors or an officer, employee, controlling person, agent or fiduciary of
the Company, the Company shall promptly maintain in full force and effect directors’ and officers’ liability
insurance in reasonable amounts from established
and reputable insurers.

 

(b)           In
all policies of directors’ and officers’ liability insurance,
the Indemnitee shall be named as an insured in such a manner as to provide the
Indemnitee the same rights and benefits as are accorded to the most favorably
insured of the Company’s directors, if the Indemnitee is a director; or of the
Company’s officers, if the Indemnitee is not a director of the Company but is
an officer; or of the Company’s key employees, if the Indemnitee is not a
director or officer of the Company.

 

(c)           If,
at the time of the receipt by the Company of a notice of a Claim pursuant to Section 2(a) hereof,
the Company has liability insurance in effect which may cover such Claim, the
Company shall give prompt notice of the commencement of such Claim to the
insurers in accordance with the procedures set forth in each of the Company’s
policies.  The Company shall thereafter
take all necessary or desirable action to cause such insurers to pay, on behalf
of Indemnitee, all amounts payable as a result of such action, suit,
proceeding, inquiry or investigation in accordance with the terms of such
policies.

 

13.           Choice
of Counsel.  If
Indemnitee is not an officer of the Company, Indemnitee, together with the
other directors who are not officers of the Company (the “Outside Directors”), shall be entitled to employ, and be reimbursed for the
fees and disbursements of, counsel separate from that chosen by Indemnitees who
are officers of the Company.  The
principal counsel for Outside Directors (“Principal
Counsel”) shall be
determined by majority vote of the Outside Directors, and the Principal Counsel
for the Indemnitees who are not Outside Directors (“Separate
Counsel”) shall be determined
by majority vote of such Indemnitees. 
The obligation of the Company to reimburse Indemnitee for the fees and
disbursements of counsel hereunder shall not extend to the fees and
disbursements of any counsel employed by Indemnitee other than Principal Counsel
or Separate Counsel, as the case may be, provided that (i) Indemnitee
shall have the right to employ Indemnitee’s counsel in any such Claim at
Indemnitee’s expense and (ii) if (A) the employment of counsel by
Indemnitee has been previously authorized by the Company, (B) Indemnitee
shall have reasonably concluded with the advice of counsel that there is a
substantial possibility that Principal Counsel or Separate Counsel, as the case
may be, will have a conflict of interest in representing Indemnitee, or (C) the
Company shall not continue to retain Principal Counsel or Separate Counsel, as
the case may be, to defend such Claim, then the fees and expenses of Indemnitee’s
counsel shall be at the expense of the Company

 

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

 

 

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

 

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

 

17.           Settlement of Claims.  The
Company shall not be liable to indemnify indemnitee under this Agreement for
any amounts paid in settlement of any Claim effected without the Company’s
prior written consent.  The Company shall
not settle any Claim in any manner which would impose any penalty or limitation
on Indemnitee without Indemnitee’s prior written consent.  Neither the Company nor Indemnitee will
unreasonably withhold or delay their consent to any proposed settlement.  The Company shall not be liable to indemnify
Indemnitee under this Agreement with regard to any judicial award if the
Company was not given a reasonable and timely opportunity, at its expense, to
participate in the defense of such action.

 

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

 

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

 

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

 

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

 

[Signature
Page Follows]

 

 

IN WITNESS
WHEREOF, the parties hereto have executed this Agreement as of July 6,
2006.

 

 

	
   

  	
  WESTERN GAS RESOURCES,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter A. Dea

  	
   

  
	
   

  	
  Name: 

  	
  Peter A. Dea

  
	
   

  	
  Title:

  	
  President and Chief Executive

  
	
   

  	
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John F. Chandler

  	
   

  
	
   

  	
  Name: John F. ChandlerExhibit 10.3

 

EMPLOYMENT AGREEMENT

 

THIS
EMPLOYMENT AGREEMENT (the “Agreement”) is made effective as of July 6,
2006, by and between WESTERN GAS RESOURCES, INC., a Delaware corporation (the “Corporation”)
and William J. Krysiak (“Employee”).

 

WITNESSETH:

 

WHEREAS, the
Corporation, directly and indirectly through its subsidiaries, affiliated
companies, partnerships, joint ventures and other business organizations
(collectively, the “Western Companies” and individually, a “Western Company”)
acquire, design, construct and operate natural gas gathering and processing
facilities, market, store and transport natural gas and natural gas liquids,
and explore for, develop, and produce oil and gas.

 

WHEREAS,
Employee has substantial experience in the Corporation’s business and is
currently the Corporation’s Executive Vice President and Chief Financial
Officer.

 

WHEREAS,
prior hereto, the Corporation and Employee entered into that Employment
Agreement, dated October 15, 2001 (the “Prior Agreement”)

 

WHEREAS, the
parties desire to clarify certain portions of the Prior Agreement and to modify
certain of the benefits and obligations provided thereunder and accordingly,
the Prior Agreement shall be terminated upon execution of and replaced in its
entirety by this Agreement.

 

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

 

1.             Definitions.

 

(a)           “Annual Bonus”
means a cash bonus, as may be determined pursuant to any bonus plan applicable
to Employee for any fiscal year of the Corporation, in an amount which has been
approved by the Corporation’s Board of Directors in its sole and absolute
discretion to be payable to Employee. 
For the purposes of Subsections 13(a) and 14(a)(i) of this
Agreement, Annual Bonus shall mean the average of the last three Annual Bonus
payments made to Employee prior to the Termination Date (annualized for any
year in which Employee was not employed for the full year if the bonus for such
year was pro rated and including any Annual Bonus determined by the Board of
Directors in any year to be zero).  If
Employee has been employed for a shorter period than that required to obtain
three Annual Bonus Payments, the amount of Annual Bonus hereunder shall be the
amount last paid to Employee or shall be the averaged annual amount of the most
recent Annual Bonus payments made if more than one.

 

(b)           “Base Salary”
means Employee’s current annual base salary payable by the Corporation.

 

(c)           “Cause” means (i) Employee’s
material breach of this Agreement, or failure, neglect or refusal to perform
his duties hereunder (other than any such failure resulting from Employee’s
disability or from the assignment of duties that would constitute “Good Reason”
as defined herein), (ii) any act or omission by Employee constituting
willful misconduct or gross negligence which is, or could reasonably expected
to become, 

 

1

 

materially injurious to the Corporation,
monetarily or otherwise, (iii) Employee’s material violation of any
domestic or foreign securities law or regulation, including those of the New
York Stock Exchange or stock exchange governing the listing of the Corporation’s
securities (other than inadvertent violations of reporting of beneficial
ownership pursuant to Section 16(a) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)), (iv) any
act by Employee constituting a felony; (v) any act by Employee
constituting a misdemeanor involving moral turpitude, (vi) any theft or fraud
by Employee which results in a felony or misdemeanor conviction of Employee, (vii) any
dishonesty or knowing misrepresentation resulting or intended to result in personal benefit or enrichment to
Employee or harm to the Corporation, or (viii) Employee’s material
violation of any of the Corporation’s Board approved policies or any of the
Corporation’s policies regarding prohibited discriminatory or harassing
behavior.

 

(d)           “Change of
Control” means as a result of one transaction or a series of related transactions:

 

(i)            The acquisition by any individual,
entity or group (within the meaning of Section 12(d) (3) or 13(d) (2) of
the Exchange Act (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of more than thirty-five (35%) percent of
either (A) the then outstanding shares of common stock of the Corporation
(the “Outstanding Common Stock”) or (B) the combined voting power of the
then outstanding voting securities of the Corporation entitled to vote generally
in the election of directors (the “Outstanding Voting Securities”); provided,
however, that for purposes of this subsection (i), the following
acquisitions shall not constitute a Change in Control: (A) any acquisition
by the Corporation, (B) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Corporation or any corporation
controlled by the Corporation, or (C) any acquisition by any entity
pursuant to a transaction which complies with Subsection 1(d)(iii); or

 

(ii)           Individuals who, as of the date
hereof, constitute the Board of Directors (the “Incumbent Board”) cease for any
reason to constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Corporation’s shareholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a
person other than the Incumbent Board; or

 

(iii)          Consummation of a reorganization,
merger or consolidation or sale or other disposition of all or substantially
all of the assets of the Corporation (a “Business Combination”), in each case,
unless, following such Business Combination, (A) all or substantially all
of the individuals and entities who were the beneficial owners, respectively,
of the Outstanding Common Stock and Outstanding Voting Securities immediately
prior to such Business Combination beneficially own, directly or indirectly,
more than 50% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting 

 

2

 

securities entitled to vote generally in the election of
directors, as the case may be, of the entity resulting from such Business
Combination (including, without limitation, a corporation which as a result of
such transaction owns the Corporation or all or substantially all of the
Corporation’s assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination of the Outstanding Common Stock and Outstanding
Voting Securities, as the case may be, and (B) no person (excluding any
corporation resulting from such Business Combination or any employee benefit
plan (or related trust) of the Corporation or such corporation resulting from
such Business Combination) beneficially owns, directly or indirectly, 35% or
more of, respectively, the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined voting
power of the then outstanding voting securities of such corporation except to
the extent that such ownership existed prior to the Business Combination, and (C) at
least a majority of the members of the board of directors of the corporation
resulting from such Business Combination were members of the Incumbent Board at
the time of the execution of the initial agreement, or of the action of the
Incumbent Board providing for such Business Combination; or

 

(iv)          Approval by the shareholders of the
Corporation of a complete liquidation or dissolution of the Corporation.

 

(e)           “Change of Control Event” means the
earlier of (i) a Change of Control, or (ii) the execution and
delivery by the Corporation of an agreement providing for a Change of Control.

 

(f)            “Change of
Control Period” means the period commencing ninety (90) days prior to the
occurrence of a Change of Control Event and ending 12 months after such Change
of Control.

 

(g)           “Confidential Information” means all
nonpublic information and trade secrets (whether in paper or electronic form,
or contained in Employee’s memory or otherwise stored or recorded) relating to
or arising from the business, operations or properties of any of the Western
Companies, including, but not limited to, any information concerning the
business operations, business strategies, nonpublic policies or internal
structure of the Western Companies; Litigation Information; Confidential
Projects; proposed projects and areas of intended leasing activity and
gathering and processing activity; the customers, vendors, contractors, suppliers
or clients of any of the Western Companies; any acquisition strategies of any
of the Western Companies; the gas and other products, marketing or
transportation strategies of any of the Western Companies; the terms of any gas
gathering, processing, marketing, or transportation contracts entered into by
any of the Western Companies; past, present or future research by any of the
Western Companies in connection with the existing or proposed business or
operations of any of the Western Companies; personnel data of any of the
Western Companies; Employee’s work performed for, or relating to or for, any
customer or client of any of the Western Companies; the gas or other product
pricing for any customer or client of any of the Western Companies; any method
or procedure relating or pertaining to projects developed by any Western
Companies or contemplated by any Western Company to be developed; any gas
gathering, processing, drilling, marketing, transportation project which any of
the Western Companies is developing; all Technical and Engineering
Information.  Information shall not 

 

3

 

be deemed to be Confidential Information for
purposes of this Agreement which: (i) is or hereafter becomes publicly
known through no improper or unauthorized act or omission of Employee; (ii) is
received by Employee without restriction on disclosure from a third party who
disclosed the information without, to the best of Employee’s knowledge,
violating any restriction on confidentiality or disclosure; or (iii) is
independently developed after the termination of Employee’s employment with the
Corporation by Employee without reference to the Confidential Information and
without violation of any confidentiality restriction.

 

(h)           “Confidential
Projects” means the activities of or plans of any Western Company relating to
the development, planning or execution of new project, expansion or acquisition
strategy or target relating to areas of intended leasing activity and gathering
and processing activity or any other material business of any Western Company.

 

(i)            “Good Reason”
means
(i) any material breach by the Corporation of its obligations under this
Agreement, including the failure of the Corporation to pay Employee the Base
Salary or, if declared by the Board, the Annual Bonus, or any other payment due
Employee hereunder, or to provide any benefits required pursuant to this
Agreement; (ii) any action of Corporation that results in any reduction in
Employee’s title below an officer title, (iii) any action of Corporation
that results in any material diminishment in Employee’s duties, functions,
responsibilities or authority( provided however that any changes in spending
authority shall not be considered to be a material diminishment in duties, functions,
responsibilities or authority), (iv) any reduction of Employee’s Base
Salary, (v) any material reduction of benefits on a basis different than
other peer executives of the Corporation; or (vi) a requirement that
Employee be based anywhere other than within twenty-five (25) miles of Employee’s
current principal place of employment except for travel that may be required of
Employee in performing his employment duties hereunder; provided, however,
that if the Corporation suspends Employee from performing his employment duties
hereunder for the purposes of performing an internal investigation potentially
involving Employee or if the Employee is terminated for Cause, then such
suspension or termination shall not constituted Good Reason.

 

(j)            “Litigation Information” means
information concerning possible or existing claims, investigations or
litigation involving any of the Western Companies.

 

(k)           “Material
Competition” means that Employee is involved in any business or investment
activity, in any capacity, including, but not limited to, as an employee,
consultant, advisor, agent, shareholder (other than as a shareholder of less
than five (5%) percent of a publicly traded corporation), independent
contractor, investor, partner, member, owner or otherwise, which activity
directly competes with or has a material adverse economic effect on any of the
activities or business of any Western Company. 
Material competition includes, but is not limited to, any activity
involving the gathering and processing business within 25 miles of one of the
Western Companies’ existing or planned gathering, processing or generation
facilities; any activity involving the purchase of oil or gas leases, the
farming-in of such leases or any similar arrangement, within five (5) miles
of the boundaries of an existing oil or gas lease of any Western Company; and,
in relation to a Confidential Project involving oil and gas exploration,
development or production, any activity, directly or indirectly, involving the
purchase of oil or gas leases or the farm-in or participation in operations
under leases or any similar arrangement within ten (10) miles of the
boundaries of the target area of such Confidential Project.

 

4

 

(l)            “Short Term
Disability Period” means the period of ninety (90) days’ following
determination of Employee’s disability as that term is defined pursuant to the
Corporation’s long-term disability insurance plan.

 

(m)          “Technical and Engineering Information”
means all nonpublic information, technical and engineering information
associated with or related to any oil, gas or mineral property and any
gathering and/or processing facility of any of the Western Companies or with
respect to which any of the Western Companies formed an intention to acquire,
lease or form any other business relationship prior to the termination of
Employee’s employment including, but not limited to, seismic data, engineering
reports and methods, geological matters, the results of expiration, drilling,
drill cores, cuttings and other samples, production, processing, gathering and
drilling techniques and water disposal techniques; or any plans or strategy
related to the foregoing.

 

(n)           “Termination
Date” means the effective date of termination of employment under this
Agreement.

 

2.             Employment. The Corporation hereby employs Employee and Employee hereby
accepts such employment with the Corporation upon the terms and conditions
hereinafter set forth.  Employee’s
employment shall continue until it is terminated in accordance with the
provisions herein.

 

3.             Powers, Duties and
Responsibilities.

 

(a)           Employee shall
devote his full time, attention and effort to the business of the Western
Companies during the Corporation’s normal business hours and during such other
times as are reasonably necessary for the proper performance of his
responsibilities hereunder; provided, however, that Employee may
serve (i) on the board of any charitable organization or industry group,
and (ii) with the consent of the Board of Directors, Employee may serve on
the board of one (1) publicly traded corporation; and provided further
that in the case of both (i) and (ii) above that such service does
not significantly interfere with Employee’s duties hereunder.

 

(b)           Employee’s
primary duties shall be to act as the Executive Vice President and Chief
Financial Officer.  Employee shall have
such powers, duties and responsibilities, and shall perform such other
functions in connection with the business of the Western Companies, as may be
assigned from time to time by the Corporation.

 

4.             Base Salary and
Annual Bonus.  For all of the services rendered by Employee
pursuant to this Agreement, the Corporation shall pay Employee his Base Salary,
payable in accordance with the Corporation’s normal pay practices so long as
employed under this Agreement.  In no
event shall Employee’s Base Salary be decreased, but it may, from time to time
be increased at the discretion of the Corporation.  In addition, the Corporation shall pay
Employee an Annual Bonus as determined by the Board of Directors from time to
time.

 

5.             Officer Insurance
Coverage - Costs of Defense.  During the term of Employee’s employment and
thereafter, to the extent the Corporation maintains an insurance policy or
policies providing directors’ and officers’ liability insurance, Employee shall
be covered by such policy or policies, in accordance with its or their terms,
to the maximum extent of the coverage available for 

 

5

 

any officer of the Corporation provided
that such insurance coverage is available to the Corporation at a reasonable
cost. Such coverage shall provide to Employee officer liability insurance
coverage to cover any claims that may be made arising from his past, present,
or future activities on behalf of the Western Companies.  Employee hereby represents that to his
knowledge no investigation, claim, or litigation is currently pending or
threatened against him at this time relating to or arising out of his
activities as an employee of any Western Company.

 

6.             Cooperation With
Respect to Investigations, Claims or Litigation.  During the term of
Employee’s employment and at all times thereafter, should a Western Company
become involved in any investigation, claim, or litigation relating to or
arising out of Employee’s past, present, or future duties with a Western
Company or with respect to any matters which Employee has knowledge, Employee
agrees to fully, and in good faith, cooperate with the Corporation with respect
to such investigation, claim, or litigation. 
The Corporation shall reimburse Employee for any and all expenses in
accordance with the Indemnification Agreement, as defined below.

 

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

 

8.             Employee Benefits. During the term of employment hereunder, Employee shall be
eligible to participate in the employee benefit plans provided by the
Corporation on the same basis as other similarly situated executives at the
level of Vice President and above, as such plans may be changed from time to
time, in accordance with the provisions of such plans, including, but not
limited to, the Corporation’s qualified retirement plans and the Corporation’s
stock incentive plan(s). Employee hereby agrees and acknowledges that nothing
in this Agreement guarantees him the right to any grant of stock options,
restricted stock or any other right under any stock incentive plan, or other
plan.

 

9.             Confidential
Information and Nondisclosure.

 

(a)           Employee
acknowledges that pursuant to his employment hereunder, Employee occupies a
position of trust and confidence. 
Accordingly, in the course of performing the employment obligations
hereunder, Employee will have access to and may develop or obtain certain
Confidential Information.

 

(b)           Employee agrees
that all Confidential Information shall remain the exclusive property of the
Corporation during and after Employee’s employment with the Corporation.  Employee further agrees that during and after
the term hereof, he shall not, except for the benefit of the Corporation
pursuant to the exercise of his duties hereunder or with prior written consent
of the Corporation, use for any purpose or disclose to any third party any of
the Confidential Information.

 

(c)           All
information, drawings, documents and materials whether in writing, on computer
disks, computer hard drive, on magnetic tape or otherwise prepared by Employee
in connection with his employment are hereby assigned to the Corporation
without reservation of any rights by Employee, and all such information which
Employee obtains in the course of or as result of his employment by the
Corporation in all cases shall 

 

6

 

be the sole
and exclusive property of the Corporation and will be delivered to the
Corporation by Employee on the earlier of a demand by the Corporation or
promptly after the Termination Date, together with all written, computer,
magnetic tape or other evidence of the information, drawings, document and
materials, if any, furnished by any Western Company to Employee in connection
with Employee’s employment.

 

(d)           If Employee
violates this agreement of confidentiality, Employee agrees that the Western
Companies shall, in addition to any other remedy provided by law, be permitted
to pursue an action for injunctive relief, monetary damages, or both.

 

10.          Non-Solicitation. During the term of this Agreement and for a period of eighteen
months (18) thereafter, Employee shall not hire, offer to hire, solicit, or
participate in the hiring or induce the resignation of any officer or employee
of any Western Company; provided, however, nothing contained
herein shall prevent Employee from hiring any officer or employee of any
Western Company that originates as a result of a general solicitation in a
publicly available publication, including the internet, as long as there is no
involvement or participation of any kind or nature, directly or indirectly by
Employee in (a) the solicitation of the officer or employee of any Western
Company, or (b) inducing the resignation of such officer or employee of
any Western Company. In the event Employee violates this non-solicitation
provision, the Western Company shall, in addition to any other remedy provided
by law, be permitted to pursue an action for injunctive relief, monetary
damages, or both.

 

11.          Agreement Not to
Compete. The
parties hereto recognize that Employee is retained by the Corporation as part
of a professional, management and executive staff of the Corporation whose
duties include the formulation and execution of corporate strategy.  Therefore,

 

(a)           Employee hereby
agrees that while Employee is employed pursuant to this Agreement he shall not
act or engage in Material Competition; and

 

(b)           for a period of
one (1) year following the Termination date:

 

(i)            In the event
that this Agreement is terminated by the Corporation for Cause or by Employee
without Good Reason, he shall not act or engage in Material Competition with
respect to the business or activities of any Western Company as they exist on
the date of termination of Employee’s employment; or

 

(ii)           In the event
that this Agreement is terminated by the Corporation without Cause or by the
Employee for Good Reason, he shall not act or engage in Material Competition
with respect to any Confidential Projects as they existed up to and including
the Termination Date in any State in which any Western Company engages or plans
to engage in business.

 

In the event that Employee violates this
agreement not to compete, the Corporation shall, in addition to any other
remedies provided by law, be permitted to pursue an action for injunctive
relief (preliminary or permanent), monetary damages, or both.

 

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

 

(a)           Employee’s
death.

 

7

 

(b)           The end of the
Short Term Disability Period if Employee is unable to return to work at the end
of such Short Term Disability Period; provided, however, that
during such Short Term Disability Period, Employee shall be entitled to 100% of
Employee’s Base Salary reduced by any other Corporation-provided salary-related
benefits to which Employee may be entitled with respect to the Short Term
Disability Period which benefits are payable solely on account of such
disability (including, but not limited to, benefits under any disability
insurance policy, worker’s compensation law or any other benefit program or
arrangement).

 

(c)           Employee’s
written election to terminate employment, with or without Good Reason, to be
effective ninety (90) days thereafter unless an earlier effective date is
specified by the Corporation.

 

(d)           The Corporation’s
written election to terminate Employee’s employment with or without Cause,
effective as of the date set forth by the Corporation in such election.

 

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

 

(a)           Employee’s
Right to Base Salary and Benefits. 
Employee shall be entitled to the following: (i) Base Salary and
employee benefits, if any, which have been earned but not paid through the
Termination Date, and (ii) an Annual Bonus, equal to the product of (A) the
Annual Bonus, and (B) a fraction, the numerator of which is the number of
days in the current fiscal year through the date of termination and the
denominator of which is 365.

 

(b)           Employee’s
Obligations.  Notwithstanding such
termination of employment, if Employee is terminated as a result of disability,
Employee shall remain bound by the provisions of Sections 6, 9, 10 and 11
hereof.

 

14.          Employee’s Rights
and Obligations Upon Termination of Employment By The Corporation Without Cause
or By Employee for Good Reason.  If Employee’s employment
is terminated by the Corporation without Cause or by Employee for Good Reason,
then Employee shall be entitled to the following in full satisfaction of his
rights under this Agreement or at law:

 

(a)           Severance
Pay.

 

(i)            Employee shall
be entitled to severance pay in an amount equal to:

 

(A) the sum of (1) Employee’s Base Salary, if any, which
has been earned but not paid through the Termination Date, (2) the product
of (x) the Annual Bonus and (y) a fraction, the numerator of which is the
number of days in the current fiscal year through the Termination Date and the
denominator of which is 365, and (3) any accrued vacation or other pay
pursuant to the Corporation’s vacation or Paid Time Off policy, to the extent
not previously paid; and

 

(B) an amount equal to the sum of (1) Employee’s Base
Salary and (2) the Annual Bonus; provided, however, that in
the event that Employee’s 

 

8

 

employment
has been terminated, as set forth above in this Section 14, at any time
during a Change of Control Period, then this amount shall be multiplied by a
factor of 2 and Employee shall receive such increased amount less any amount
previously paid to Employee under this sub-section (B).

 

(ii)           Employee shall
be entitled to continue to receive group health and dental insurance coverage
equivalent to the coverage to which he would have been entitled under such
plans if he had continued working for the Corporation in the position held on
the Termination Date for a period of 12 months following the Termination Date,
which period shall be increased to 24 months in the event that Employee has
been terminated at any time during a Change of Control Period.  In addition, the Corporation shall continue
to pay the premiums on any supplemental term life and long term disability
policies obtained by the Corporation for Employee’s benefit on or before the
Termination date for a period of 12 months following the Termination Date,
which period shall be increased to 24 months in the event that Employee has
been terminated at any time during a Change of Control Period.

 

(b)           Certain
Additional Payments by the Corporation. The Corporation shall be
responsible for the payment of taxes to the extent applicable as set forth in Exhibit “B”
hereto.  Any payments made hereunder as a
result of a Change of Control shall be subject to the provisions of Exhibit “B”.

 

(c)           Employee’s
Obligations.  Notwithstanding such
termination of employment, Employee shall remain bound by the provisions of
Sections 6, 9, 10 and 11 hereof.

 

15.          Employee’s Rights
and Obligations Upon Termination of Employment by the Corporation With Cause or
Termination of Employment by Employee Without Good Reason.  If Employee’s employment
is terminated by the Corporation with Cause or by Employee without Good Reason,
then Employee shall be entitled to the following in full satisfaction of all of
his rights under this Agreement or at law:

 

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

 

(b)           Employee’s
Right to Base Salary and Benefits. Employee shall only be entitled to the
Base Salary and employee benefits, if any, earned but not paid through the
Termination Date. Employee shall only be entitled to such additional Annual
Bonus, if any, which has been previously authorized by the Board of Directors,
but has not been paid as of the Termination Date.

 

(c)           Employee’s
Obligations. Notwithstanding such termination of employment, Employee shall
remain bound by the provisions of Sections 6, 9, 10 and 11 hereof.

 

16.          Payment
Dates; Section 409A of the Internal Revenue Code.

 

(a)           Subject to the provisions of Sections
16(b), (c) and (d) below, any payments required to be made to
Employee pursuant to Sections 13, 14 or 15 hereunder shall be made within
thirty (30) days’ of the Termination Date.

 

9

 

(b)           Anything in this Agreement to the
contrary notwithstanding, if (i) on the Termination Date any of the
Corporation’s stock is publicly traded on an established securities market or
otherwise (within the meaning of Section 409A(a)(2)(B)(i) of the
Internal Revenue Code, as amended (the “Code”)) and (B) as a result of
such termination, Employee would receive any payment that, absent the
application of this Section 16, would be subject to interest and
additional tax imposed pursuant to Section 409A(a) of the Code as a
result of the application of Section 409A(2)(B)(i) of the Code, then
no such payment shall be payable prior to the date that is the earliest of six (6) months
after the Termination Date or such other date as will cause such payment not to
be subject to such interest and additional tax.

 

(c)           It is the intention of the parties
that payments or benefits payable under this Agreement not be subject to the
additional tax imposed pursuant to Section 409A of the Code.  To the extent such potential payments or
benefits could become subject to such Section, the parties shall cooperate to
amend this Agreement with the goal of giving Employee the economic benefits
described herein in a manner that does not result in such tax being imposed.

 

(d)           Notwithstanding anything to the
contrary in the Agreement, payment to Employee upon termination shall be
conditioned upon Employee’s execution of a legal release in a form satisfactory
to Company in its discretion and drafted and executed to, among other things,
ensure a final, complete and enforceable release of all claims that Employee
has or may have against Company relating to or arising in any way from Employee’s
employment with Company and/or the termination thereof (but excepting claims
for indemnification or defense, whether under contract, the Articles of
Incorporation, By-Laws, or otherwise), and complete and continuing confidentiality
of Company’s proprietary information and trade secrets, and, at the Company’s
discretion, the circumstances of Executive’s separation from Company and/or
compensation received by Executive in connection with that separation.

 

17.          Survival.  In the event that this Agreement is
terminated by either party, Sections 5, 6, 9, 10, and 11 shall survive for the
periods of time specified therein or if no period is specified, in perpetuity.

 

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

 

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

 

Western Gas
Resources, Inc.

1099 18th
Street, Suite 1200

Denver,
Colorado 80202

 

10

 

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

 

 

 

20.          Miscellaneous.

 

(a)           Governing Law and Venue.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Colorado.  Resolution of any disputes under this
Agreement shall only be held in courts in Denver County, Colorado, and the
parties expressly consent to personal jurisdiction in courts in Denver County,
Colorado and waive any objections to such jurisdiction.

 

(b)           Severability.  In the event one or more of the provisions
contained in this Agreement, or any application thereof, shall be invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein or any other
application or modification thereof, shall not in any way be affected or impaired.
The parties further agree that any such invalid, illegal or unenforceable
provision or restriction shall be deemed modified so that it shall be enforced
to the greatest extent permissible under law, and to the extent that any court
of competent jurisdiction determines any provision or restriction herein to be
overly broad, or unenforceable, such court is hereby empowered and authorized
to limit such provisions or restriction so that it is enforceable for the
longest duration of time, within the largest geographical area and with the
broadest scope.

 

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

 

(d)           Assignment.
Except as provided in Section 18, this Agreement is personal to each of
the parties hereto, and neither party may assign nor delegate any of such party’s
rights or obligations hereunder without first obtaining the written consent of
the other party.

 

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

 

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

 

(g)           Entire
Agreement. Except for the Indemnification Agreement, this Agreement
contains all agreements, understandings, and arrangements between the parties
hereto and no other exists. Except for the Indemnification Agreement, all
previous agreements, understandings, and arrangements between the parties
relating to 

 

11

 

employment
are terminated by this Agreement. This Agreement may be amended, waived,
changed, modified, extended or rescinded only by a writing signed by the party
against whom such amendment, waiver, change, modification, extension or
rescission is sought.

 

12

 

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

 

 

	
   

  	
  CORPORATION:

  
	
   

  	
   

  
	
   

  	
  WESTERN GAS RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Peter A. Dea

  	
   

  
	
   

  	
  Name: Peter A. Dea

  
	
   

  	
  Title:  
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J. Krysiak

  	
   

  
	
   

  	
  Name: William J. Krysiak

  

 

13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]