FINDERS AND CONSULTING SERVICES AGREEMENT
This FINDERS AND CONSULTING SERVICES AGREEMENT is made as of
the 20th day of February, 1998, by and between XXXXXX XXXXX, an individual
residing at 0000 Xxxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000 ("Urcis"), X.
XXXXX & COMPANY, a California corporation ("UrcisCo"), UNIVERSAL COMPRESSION,
INC., a Texas corporation (the "Company") and UNIVERSAL COMPRESSION HOLDINGS,
INC., a Delaware corporation ("Holdings").
WHEREAS, Tidewater, Inc. has agreed to sell (the
"Acquisition") Tidewater Compression Service, Inc. ("TCS") to TW Acquisition
Corporation ("TW") and TW is a direct wholly-owned subsidiary of Holdings;
WHEREAS, upon the consummation of the Acquisition (the
"Closing"), TW will be merged into TCS and TCS will change its name to Universal
Compression, Inc.;
WHEREAS, Holdings expects to invest in, and otherwise engages
in transactions involving, companies in the energy field services industry
related to TCS's business;
WHEREAS, Urcis and UrcisCo have researched and followed the
energy field services industry for many years and have provided finder services
to TW and Holdings;
WHEREAS, each of the Company and Holdings desires to retain
UrcisCo to provide advice concerning investments in, and transactions involving,
companies in the energy field services industry and UrcisCo desires to provide
such advice to the Company and Holdings; and
WHEREAS, Holdings desires to retain Urcis as a director and
Chairman of the Executive Committee of Holdings, and Urcis desires to serve as a
director and Chairman of the Executive Committee of Holdings;
NOW, THEREFORE, it is agreed as follows:
1. Appointment of Consultant. Effective upon the date of
Closing (the "Closing Date"), and until this Agreement is terminated in
accordance with Paragraph 5 hereof, the Company and Holdings hereby retain
UrcisCo as a consultant to provide them with advice, from time to time, as the
Company and Holdings may request, concerning investments in, and other
transactions involving, companies in the energy field services industry.
2. Acceptance by Consultant. UrcisCo hereby accepts such
appointment and agrees to provide the Company and Holdings with advice
concerning investments in, and other transactions involving, companies in the
energy field services industry, and to give the Company and Holdings his best
judgment and efforts in rendering his services pursuant to this Agreement.
3. Retention as Director. Effective upon the Closing Date,
Holdings agrees to use its best efforts to retain Urcis as a director and
Chairman of the Executive Committee of Holdings.
4. Fees; Grant of Stock Option. For services rendered to date,
Holdings will pay Urcis a finders fee of $1,750,000 upon Closing, $1,100,000 of
which will be used to purchase (i) 17,600 shares of Holdings Series A Preferred
Stock at $50 per share and (ii) 4,400 shares of Holdings Common Stock at $50 per
share. For services rendered hereunder beginning as of the Closing Date, the
Company shall pay UrcisCo an annual consulting fee of $150,000, payable in equal
monthly installments of $12,500 in advance on the first business day of each
month.
Urcis is hereby granted an option that will expire on the
tenth anniversary date of the date hereof in the form of the Stock Option
Agreement attached as Exhibit A hereto to purchase from Holdings, 5,957 shares
of Common Stock at an exercise price of $50 per share. Holdings shall pay for
reasonable out-of-pocket expenses incurred by Urcis in rendering services
herewith in connection with the Acquisition.
5. Term and Termination.
(a) The term of this Agreement shall be for an initial term of
five (5) years commencing upon the Closing Date. Such term shall be renewed
automatically for additional one-year periods unless either of the parties
hereto shall give notice in writing ninety (90) days before the expiration of
the initial five-year term or any one-year renewal thereof of its desire to
terminate this Agreement.
(b) This Agreement shall terminate upon the termination of the
Management Agreement between Xxxxxx Xxxxxx, Inc., Holdings and Universal
Compression, Inc. dated as of the date hereof. Any termination of this Agreement
shall be without payment of any penalty, except that the Company shall remain
liable to UrcisCo for the payment of fees pursuant to Paragraph 4 hereof for the
period prior to the effective date of such termination. Nothing herein shall
relieve any party of any liability for any breach of this Agreement.
6. Independent Contractor. UrcisCo shall be deemed to be an
independent contractor and shall have no authority to act for or bind the
Company or Holdings.
7. Arbitration. In order to minimize the potentially high
costs incurred by all parties involved in disputes, any controversy arising out
of or relating to this Agreement or the termination of this Agreement, including
without limitation, any claim by Urcis or UrcisCo against Holdings or any of its
affiliates, directors, officers or employees under federal, state or local
statutory or common law, and any dispute under the scope of this paragraph,
shall be resolved by binding arbitration in New York, New York. The arbitration
will be conducted in accordance with the presently prevailing commercial dispute
resolution rules of the American Arbitration Association (the "AAA"). Urcis,
UrcisCo, the Company and Holdings agree to keep confidential from third parties
(other than the arbitrator and the AAA) the existence of any dispute, unless
otherwise required by law. A judgment on the arbitrator's decision shall be
final
2
and may be entered in any court having jurisdiction. The arbitration
procedure shall be in lieu of any and all actions in law or equity.
8. Entire Agreement. This Agreement contains the entire
agreement of the parties hereto with respect to the matters set forth herein and
supersedes any prior understanding or arrangement, oral or written, with respect
thereto.
9. Amendment. This Agreement shall not be amended except by a
writing signed by the parties hereto. No waiver of any provision of this
Agreement shall be implied from any course of dealing between the parties hereto
or from any failure by any such party to assert its rights hereunder on any
occasion or series of occasions.
10. Governing Law. This Agreement shall be construed in
accordance with, and governed by, the laws of the State of New York without
reference to the principles of conflicts of laws.
11. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same instrument, and it shall not be necessary in
making proof of this Agreement to produce or account for more than one such
counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.
/s/ Xxxxxx Xxxxx
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XXXXXX XXXXX
X. XXXXX & COMPANY
By: /s/ Xxxxxx Xxxxx
------------------------
Name: Xxxxxx Xxxxx
Title: President
UNIVERSAL COMPRESSION, INC.
By: /s/ Xxxxx Xxxxxx
------------------------
Name: Xxxxx Xxxxxx
Title: Chief Financial Officer
UNIVERSAL COMPRESSION HOLDINGS, INC.
By: /s/ Xxxxx Xxxxxx
------------------------
Name: Xxxxx Xxxxxx
Title: Chief Financial Officer
