FORM OF COMPRESSCO PARTNERS, L.P. 2011 LONG TERM INCENTIVE PLAN RESTRICTED UNIT AGREEMENT
Exhibit 10.4
Employee:
|
Date of Grant: | Number of Restricted Units: |
This Restricted Unit Agreement (this “Agreement”) is made as of between
Compressco Partners GP Inc., a Delaware corporation (the “Company”), and
(the “Employee”) pursuant to the terms and conditions of the Compressco Partners, L.P. 2011 Long
Term Incentive Plan (the “Plan”). The Employee acknowledges receipt of a copy of the Plan, and
agrees that the terms and provisions of the Plan, including any future amendments thereto, shall be
deemed a part of this Agreement as if fully set forth herein. Capitalized terms used in this
Agreement but not otherwise defined herein shall have the meanings ascribed to such terms in the
Plan, unless the context requires otherwise.
WHEREAS, the Board of Directors of the Company (the “Board”), has adopted the Plan to, among
other things, attract, retain and motivate certain employees, directors and consultants of the
Company, the Partnership and their respective Affiliates (each, a “Company Entity” and,
collectively, the “Company Entities”); and
WHEREAS, the Company desires to grant to the Employee on the terms and conditions set forth
herein and in the Plan, and the Employee desires to accept on such terms and conditions, the number
of Restricted Units set forth herein.
NOW, THEREFORE, in consideration of the Employee’s agreement to provide or to continue
providing services for the benefit of the Company Entities, the Company and the Employee agree as
follows:
1. Grant of Restricted Units. The Company hereby grants to the Employee, effective as
of (the “Date of Grant”),
Restricted Units, subject to all of the terms
and conditions set forth in the Plan and in this Agreement (the “Restricted Units”).
2. Forfeiture Restrictions. The Restricted Units may not be sold, assigned, pledged,
exchanged, hypothecated, or otherwise transferred, encumbered, or disposed of to the extent then
subject to the Forfeiture Restrictions (as defined below), and in the event of the termination of
the Employee’s employment with the Company Entities for any reason or no reason whatsoever, except
as provided below, the Employee shall automatically upon such termination, for no consideration,
forfeit to the Company all of the Restricted Units to the extent then subject to the Forfeiture
Restrictions. The prohibition against transfer and the obligation to forfeit the Restricted Units
to the Company upon termination of employment are referred to herein as the “Forfeiture
Restrictions.”
3. Rights of Employee. The Restricted Units shall be evidenced either (a) by
certificates issued in the Employee’s name that are retained by the Company until the Restricted
Units are no longer subject to the Forfeiture Restrictions or are forfeited or (b) in book entry
form by the Partnership’s transfer agent with a notation that they are subject to restrictions.
Notwithstanding the foregoing, the Employee shall have all voting rights, if any, with respect to
the Restricted Units and the right to receive any Unit Distribution
Rights thereon; provided,
however, that any Unit Distribution Rights made by the Partnership with respect to a Restricted
Unit that remains subject to the Forfeiture Restrictions at the time such Unit Distribution Right
is made shall be held by the Company and shall be paid to the Employee (without interest) when the
Restricted Unit with respect to which such Unit Distribution Right was made vests or shall be
forfeited when such Restricted Unit is forfeited, as the case may be. Notwithstanding the
preceding provisions of this Section 3, the Restricted Units shall be subject to all of the
restrictions described herein, including, without limitation, the Forfeiture Restrictions.
4. Vesting of Restricted Units. Except as otherwise provided in this Agreement, the
Restricted Units will vest in accordance with the vesting schedule set forth in the following
table, provided that the Employee remains continuously employed by a Company Entity from the Date
of Grant through each vesting date set forth below (each, a “Vesting Date”):
| Vesting Date | Cumulative Vested Percentage | |||
January 4, 2___ |
33⅓ | % | ||
January 4, 2___ |
66⅔ | % | ||
January 4, 2___ |
100 | % | ||
If, on any Vesting Date, the application of the vesting schedule set forth above results in a
fractional Restricted Unit becoming vested, the number of Restricted Units vesting on such date
shall be rounded up to the next whole number of Restricted Units. Restricted Units that have
become vested pursuant to the schedule above are referred to herein as “Vested Units.”
5. Transferability and Assignment. This Agreement and the Restricted Units granted
hereunder will not be transferable by the Employee other than by will or the laws of descent and
distribution. Any purported transfer, assignment, alienation, pledge, hypothecation, attachment,
sale, transfer or encumbrance shall be null, void and unenforceable against the Company Entities.
6. Status of Units. The Employee agrees that any Vested Units that he acquires upon
vesting of the Restricted Units will not be sold or otherwise disposed of in any manner that would
constitute a violation of any applicable federal or state securities laws, the Plan or the rules,
regulations and other requirements of the SEC and any stock exchange upon which the Units are then
listed. The Employee also agrees that (a) any certificates representing the Units acquired under
this award may bear such legend or legends as the Committee deems appropriate in order to assure
compliance with applicable securities laws, (b) the Company may refuse to register the transfer of
the Units acquired under this award with the Partnership’s transfer agent if such proposed transfer
would, in the opinion of counsel satisfactory to the Partnership, constitute
2
a violation of any applicable securities law, and (c) the Partnership may give related
instructions to its transfer agent, if any, to stop registration of the transfer of the Units to be
acquired under this award. In addition to the terms and conditions provided herein, the Company
may require that the Employee make such covenants, agreements, and representations as the
Committee, in its sole discretion, deems advisable in order to comply with any such laws, rules,
regulations, or requirements.
7. Tax Withholding. The Company Entities shall have the authority and the right to
deduct or withhold, or to require the Employee to remit to a Company Entity, an amount sufficient
to satisfy all applicable federal, state and local taxes (including the Employee’s employment tax
obligations) required by law to be withheld with respect to any taxable event arising in connection
with the Restricted Units and the Unit Distribution Rights thereon. In satisfaction of the
foregoing requirement, unless either (a) other arrangements have been made that are acceptable to
the applicable Company Entity or (b) the Board or a committee of the Board that is composed solely
of two or more “Non-Employee Directors” within the meaning of Rule 16b-3, the Employee shall
surrender the number of Units otherwise issuable to him having a fair market value equal to the
sums required to be withheld by the applicable Company Entity. In the event that Units that would
otherwise be issued in respect of the Restricted Units are surrendered to satisfy such withholding
obligations, the number of Units that shall be so surrendered shall be limited to the number of
Units that have a Fair Market Value on the date of such surrender equal to the aggregate amount of
such liabilities based on the minimum statutory withholding rates for federal, state, local and
foreign income tax and payroll tax purposes that are applicable to such supplemental taxable
income.
8. General Provisions.
(a) Administration. This Agreement shall at all times be subject to the terms and
conditions of the Plan. The Committee shall have sole and complete discretion with respect to all
matters reserved to it by the Plan and all decisions of a majority of the Committee with respect
thereto and this Agreement shall be final and binding upon the Employee and the Company. In the
event of any conflict between the terms and conditions of this Agreement and the Plan, the
provisions of the Plan shall control.
(b) No Effect on Service. Nothing in this Agreement or in the Plan shall be construed
as giving the Employee the right to be retained in the employ or service of the Company Entities.
Furthermore, the Company Entities may at any time dismiss the Employee from employment free from
any liability or any claim under the Plan or this Agreement, unless otherwise expressly provided in
the Plan, this Agreement or other written agreement.
(c) Tax Consultation. None of the Board, the Committee or the Company Entities have
made any warranty or representation to the Employee with respect to the income tax consequences of
the grant or vesting of the Restricted Units or the transactions contemplated by this Agreement,
and the Employee represents that he is in no manner relying on such entities or any of their
respective managers, directors, officers, employees or authorized representatives (including
attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial
representatives) for tax advice or an assessment of such tax consequences. The Employee represents
that he has consulted with any tax consultants that the Employee deems advisable in
3
connection with the Restricted Units.
(d) Severability. If any provision of this Agreement is held to be illegal or invalid
for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but
such provision shall be fully severable and this Agreement shall be construed and enforced as if
the illegal or invalid provision had never been included herein.
(e) Successors. This Agreement shall be binding upon the Employee, the Employee’s
legal representatives, heirs, legatees and distributees, and upon the Company, its successors and
assigns.
(f) Entire Agreement. This Agreement constitutes the entire agreement of the parties
with regard to the subject matter hereof, and contains all the covenants, promises,
representations, warranties and agreements between the parties with respect to the Restricted Units
granted hereby. Without limiting the scope of the preceding sentence, all prior understandings and
agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null
and void and of no further force and effect.
(g) Headings. The titles and headings of Sections are included for convenience of
reference only and are not to be considered in construction of the provisions hereof.
(h) Governing Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Delaware, without regard to conflicts of law principles thereof.
(i) Gender. Words used in the masculine shall apply to the feminine where applicable,
and wherever the context of this Agreement dictates, the plural shall be read as the singular and
the singular as the plural.
(j) Amendments, Suspension and Termination. This Agreement may be wholly or partially
amended or otherwise modified, suspended or terminated at any time or from time to time by the
Board or the Committee (i) to the extent permitted by the Plan, (ii) to the extent necessary to
comply with applicable laws and regulations or to conform the provisions of this Agreement to any
changes thereto or (iii) to settle the Restricted Units pursuant to all applicable provisions of
the Plan. Except as provided in the preceding sentence, this Agreement cannot be modified, altered
or amended, except by a written agreement signed by both the Company and the Employee.
(k) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Policy. The terms of the Company’s ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ policy with
respect to Units are incorporated herein by reference.
(l) Clawback. Notwithstanding any provisions in the Plan or this Agreement to the
contrary, any portion of the payments and benefits provided under this Agreement or the sale of the
Units granted hereunder shall be subject to a clawback or other recovery by the Company Entities to
the extent necessary to comply with applicable law including, without limitation, the requirements
of the ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇ Street Reform and Consumer Protection Act of 2010 or any SEC rule.
4
(m) Community Interest of Spouse. The Employee’s spouse shall be required to execute
the spousal consent set forth on the signature page attached hereto to evidence such spouse’s
agreement and consent to be bound by the terms and conditions of this Agreement and the Plan as to
such spouse’s interest, whether as community property or otherwise, if any, in the Restricted Units
granted to the Employee hereunder.
(n) Consent to Electronic Delivery; Electronic Signature. In lieu of receiving
documents in paper format, the Employee agrees, to the fullest extent permitted by law, to accept
electronic delivery of any documents that the Company may be required to deliver (including,
without limitation, prospectuses, prospectus supplements, grant or award notifications and
agreements, account statements, annual and quarterly reports, and all other forms of
communications) in connection with this and any other award made or offered by the Company.
Electronic delivery may be via a Company electronic mail system or by reference to a location on a
Company intranet to which the Employee has access. The Employee hereby consents to any and all
procedures the Company has established or may establish for an electronic signature system for
delivery and acceptance of any such documents that the Company may be required to deliver, and
agrees that his or her electronic signature is the same as, and shall have the same force and
effect as, his or her manual signature.
[Signature Page Follows]
5
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized officer, effective for all purposes as provided above.
| COMPRESSCO PARTNERS GP INC. |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EMPLOYEE |
||||
SPOUSAL CONSENT
The Employee’s spouse, if any, is fully aware of, understands and fully consents and agrees to
the provisions of this Agreement and the Plan and their binding effect upon any marital or
community property interests he or she may now or hereafter own, and agrees that the termination of
his or her and the Employee’s marital relationship for any reason shall not have the effect of
removing any Units otherwise subject to this Agreement from coverage hereunder and that his or her
awareness, understanding, consent and agreement are evidenced by his or her signature below.