SERVICES AGREEMENT
Exhibit 10.3
Execution Version
This Services Agreement (this “Agreement”) is entered into June 22, 2010, by and between Oasis
Petroleum Inc., a Delaware corporation (“OAS”), and Oasis Petroleum Management LLC, a Delaware
limited liability company (“Oasis Management”).
WITNESSETH:
WHEREAS, OAS is an independent oil and gas exploration and production company;
WHEREAS, Oasis Management is owned by, among others, certain members of the management of OAS;
WHEREAS, OAS performs certain administrative, technical and ministerial services in connection
with the operation of its business which it has offered to provide, from time to time, to Oasis
Management;
WHEREAS, greater efficiency and reduced costs result from the economies of scale associated
with the provision of such services by OAS for itself and certain of its associated companies,
including Oasis Management;
WHEREAS, OAS desires to make such services, as well as certain management and professional
services (hereinafter referred to collectively as “Staff Services”) available to Oasis Management,
and Oasis Management desires to avail itself of such Staff Services;
WHEREAS, OAS and Oasis Management intend to retain absolute control over the management of
their respective business affairs, including but not limited to all matters relating to their
respective governance, asset management, operations, and the establishment of policies and
practices; and
WHEREAS, in light of the foregoing, OAS and Oasis Management desire to memorialize their
agreements with respect to the foregoing as of the date hereof and to formulate agreements for
future operations.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1
SERVICES PROVIDED BY OAS
SERVICES PROVIDED BY OAS
OAS shall provide or cause to be provided to Oasis Management, as requested by Oasis
Management, the following Staff Services in connection with the operation of Oasis Management, all
of which shall be under the control and for the benefit of Oasis Management:
Section 1.1 Information Technology Services. OAS’s Information Technology Department shall,
as the parties may from time to time agree, assist Oasis Management in establishing, maintaining
and developing information technology and telecommunications technology, including software
systems, hardware and services, that Oasis Management may utilize for its operations.
Section 1.2 Accounting Services. OAS’s Accounting Department shall, as the parties may from
time to time agree, assist Oasis Management’s Accounting Department and provide general and
specific accounting services including services in relation to financial reporting.
Section 1.3 Investment and Treasury Services. OAS’s Investment Department shall, as the
parties may from time to time agree, assist Oasis Management with respect to the investment of cash
and other financial assets of Oasis Management. In addition, OAS’s Treasury Department shall, as
the parties may from time to time agree, assist Oasis Management with respect to the establishment
and maintenance of bank accounts and banking relationships, the collection, holding and
disbursement of cash receipts of Oasis Management as well as the clearing or other back office
functions related to any securities trading or investment activity undertaken by or for the benefit
of Oasis Management, all of which shall ultimately be under the control and for the benefit of
Oasis Management.
Section 1.4 Tax Preparation. OAS shall, as the parties may from time to time agree, advise
and assist Oasis Management in preparing and filing federal, state and other tax returns, handling
discussions and proceedings with tax authorities, and planning with respect to tax liabilities.
Section 1.5 Insurance. OAS’s Risk Management Department shall, as the parties may, from time
to time, agree, assist Oasis Management with Risk Management and Insurance programs including, but
not limited to, obtaining and maintaining insurance and related products and services and
administering claims thereunder.
Section 1.6 Internal Audit. OAS’s Internal Audit Department shall, as the parties may
from time to time agree, provide internal audit services to Oasis Management.
Section 1.7 Legal. OAS’s Law Department shall, as the parties may from time to time
agree, assist Oasis Management’s Legal Department and provide general and specific legal services
Section 1.8 Strategy and Corporate Development. OAS’s Corporate Development
Department and other OAS senior executives shall, as the parties may from time to time agree,
provide assistance to Oasis Management relating to corporate strategy, acquisitions and financing
opportunities, and such other similar services as the parties may agree upon.
Section 1.9 Miscellaneous. OAS shall provide such other miscellaneous Staff
Services to Oasis Management as the parties may from time to time agree.
SECTION 2
RELATIONSHIP OF THE PARTIES
RELATIONSHIP OF THE PARTIES
Section 2.1 Each party acknowledges that the services provided hereunder by OAS are intended
to be administrative, consultative, technical or ministerial and not to set policy for Oasis
Management. Each party shall continue to set corporate policy independently through its own Board
of Directors or other governing body.
Section 2.2 In all activities under this Agreement, each party shall be an independent
contractor, except as may be otherwise specifically provided in writing and authorized by the
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appropriate Board of Directors. Nothing in this Agreement shall be deemed to (i) make either
party or any employee of such party the agent, employee, joint venturer or partner of the other
party, or (ii) create in either party the right or authority to incur any obligation on behalf of
the other party or to bind such other party in any way whatsoever except as may be expressly
provided for in this Agreement.
Section 2.3 Neither party shall have any liability for any act or omission in connection with
this Agreement other than repeating a service for the purpose of correcting an act or omission
where reasonable and appropriate under the circumstances. Neither party shall be liable to the
other party in respect of any act or omission in connection with this Agreement for loss of
profits, good will or any other general, direct, special or consequential damages of any kind.
Except as expressly set forth in this Section 2, the parties make no representations or warranties
with respect to the services to be provided under this Agreement.
Section 2.4 Oasis Management hereby agrees to defend, indemnify and hold OAS and its
affiliates (other than Oasis Management and its subsidiaries), and their respective officers,
directors, employees and agents harmless from and against any and all loss, claim, damage,
liability, cost or expense, including reasonable attorneys’ fees, incurred by OAS or any such
affiliates based upon a claim by or liability to a third party arising out of the Staff Services to
be provided by OAS hereunder, unless due to the gross negligence or willful misconduct of OAS or
its affiliates.
SECTION 3
FEES, COSTS AND EXPENSES
FEES, COSTS AND EXPENSES
Oasis Management shall pay to OAS (i) a monthly fee of four thousand dollars ($4,000.00) which
represents a reasonable estimate of the costs and expenses incurred by OAS hereunder (such as
general corporate expenses and overhead and costs of OAS employees providing services to Oasis
Management hereunder) plus (ii) the actual costs of any third party consultants engaged by OAS to
provide services to Oasis Management hereunder. Oasis Management and OAS shall periodically review
the fees paid hereunder and adjust such fees as may be mutually agreed.
SECTION 4
TERM
TERM
This Agreement may be terminated by either party at any time on not less than sixty (60) days’
prior written notice to the other party.
SECTION 5
NOTICES
NOTICES
All notices, consents and other communications hereunder shall be in writing and shall be
deemed given hereunder when sent by certified mail, return receipt requested, or delivered by hand
to a party at the following addresses, or at any other address as any party may from time to time
specify by notice to the other:
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| If to OAS: | Oasis Petroleum Inc. | |||
| First City Tower | ||||
| 0000 Xxxxxx, Xxxxx 000 | ||||
| Xxxxxxx, Xxxxx 00000 | ||||
| Attention: Compliance Officer | ||||
| If to Oasis Management: | Oasis Petroleum Management LLC | |||
| First City Tower | ||||
| 0000 Xxxxxx, Xxxxx 000 | ||||
| Xxxxxxx, Xxxxx 00000 | ||||
| Attention: Xxxxxx X. Xxxx |
SECTION 6
MISCELLANEOUS
MISCELLANEOUS
This Agreement shall be construed and enforced in accordance with and governed by the laws of
the State of Texas. The headings of this Agreement are for ease of reference and do not limit or
otherwise affect the meaning hereof. No party may assign any of its rights or obligations under
this Agreement without the express written consent of the other. This Agreement constitutes the
sole understanding and agreement of the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements or understandings, written or oral, with respect thereto.
[signature page follows]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above
written.
| OASIS PETROLEUM INC. |
||||
| By: | /s/ Xxxxxx X. Xxxx | |||
| Name: | Xxxxxx X. Xxxx | |||
| Title: | President and Chief Executive Officer | |||
| OASIS PETROLEUM MANAGEMENT LLC |
||||
| By: | /s/ Xxxxxx X. Xxxx | |||
| Name: | Xxxxxx X. Xxxx | |||
| Title: | President and Chief Executive Officer | |||
