2.4.0.81030 - Disclosure - Related Party Transactionstruefalsefalse1false falsefalseD2013Q2YTDhttp://www.sec.gov/CIK0001367064duration2013-01-01T00:00:002013-06-30T00:00:001true 1us-gaap_RelatedPartyTransactionsAbstractus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsexbrli:stringItemTypestringfalse0Related Party Transactions2false 2us-gaap_RelatedPartyTransactionsDisclosureTextBlockus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalseterseLabel1falsefalsefalse00<div style="font-size:10.0pt;font-family:Times New Roman;"> 3.  Related Party Transactions   We are a party to an omnibus agreement with Exterran Holdings, our general partner and others (as amended and/or restated, the “Omnibus Agreement”), which includes, among other things:   ·             certain agreements not to compete between Exterran Holdings and its affiliates, on the one hand, and us and our affiliates, on the other hand;   ·             Exterran Holdings’ obligation to provide all operational staff, corporate staff and support services reasonably necessary to operate our business and our obligation to reimburse Exterran Holdings for the provision of such services, subject to certain limitations and the cost caps discussed below;   ·             the terms under which we, Exterran Holdings, and our respective affiliates may transfer, exchange or lease compression equipment among one another;   ·             the terms under which we may purchase newly-fabricated contract operations equipment from Exterran Holdings’ affiliates;   ·            Exterran Holdings’ grant of a license of certain intellectual property to us, including our logo; and   ·             Exterran Holdings’ and our obligations to indemnify each other for certain liabilities.   The Omnibus Agreement will terminate upon a change of control of Exterran GP LLC, our general partner or us, and certain provisions of the Omnibus Agreement will terminate upon a change of control of Exterran Holdings. Provisions such as non-competition, transfers of compression equipment and caps on operating and selling, general and administrative (“SG&A”) expense will terminate on December 31, 2014, unless extended.   Pursuant to the Omnibus Agreement, we are permitted to purchase newly-fabricated compression equipment from Exterran Holdings or its affiliates at Exterran Holdings’ cost to fabricate such equipment plus a fixed margin of 10%, which may be modified with the approval of Exterran Holdings and our conflicts committee. During the six months ended June 30, 2013 and 2012, we purchased $53.0 million and $27.3 million, respectively, of newly-fabricated compression equipment from Exterran Holdings. Transactions between us and Exterran Holdings and its affiliates are transactions between entities under common control. Under GAAP, transfers of assets and liabilities between entities under common control are to be initially recorded on the books of the receiving entity at the carrying value of the transferor. Any difference between consideration given and the carrying value of the assets or liabilities is treated as a capital distribution or contribution. As a result, the newly-fabricated compression equipment purchased during the six months ended June 30, 2013 and 2012 was recorded in our condensed consolidated balance sheets as property, plant and equipment of $47.7 million and $24.6 million, respectively, which represents the carrying value of the Exterran Holdings’ affiliates that sold it to us, and as a distribution of equity of $5.3 million and $2.7 million, respectively, which represents the fixed margin we paid above the carrying value in accordance with the Omnibus Agreement. During the six months ended June 30, 2013 and 2012, Exterran Holdings contributed to us $15.1 million and $8.9 million, respectively, primarily related to the completion of overhauls on compression equipment that was exchanged with us or contributed to us and where overhauls were in progress on the date of exchange or contribution.   If Exterran Holdings determines in good faith that we or Exterran Holdings’ contract operations services business need to transfer, exchange or lease compression equipment between Exterran Holdings and us, the Omnibus Agreement permits such equipment to be transferred, exchanged or leased if it will not cause us to breach any existing contracts, suffer a loss of revenue under an existing compression services contract or incur any unreimbursed costs. In consideration for such transfer, exchange or lease of compression equipment, the transferee will either (1) transfer to the transferor compression equipment equal in value to the appraised value of the compression equipment transferred to it, (2) agree to lease such compression equipment from the transferor or (3) pay the transferor an amount in cash equal to the appraised value of the compression equipment transferred to it. Unless the Omnibus Agreement is terminated earlier as discussed above, the transfer of compression equipment provisions described above will terminate on December 31, 2014.   During the six months ended June 30, 2013, pursuant to the terms of the Omnibus Agreement, we transferred ownership of 146 compressor units, totaling approximately 63,000 horsepower with a net book value of approximately $27.0 million, to Exterran Holdings. In exchange, Exterran Holdings transferred ownership of 155 compressor units, totaling approximately 41,500 horsepower with a net book value of approximately $19.2 million, to us. During the six months ended June 30, 2012, pursuant to the terms of the Omnibus Agreement, we transferred ownership of 245 compressor units, totaling approximately 106,500 horsepower with a net book value of approximately $42.9 million, to Exterran Holdings. In exchange, Exterran Holdings transferred ownership of 245 compressor units, totaling approximately 72,000 horsepower with a net book value of approximately $28.4 million, to us. During the six months ended June 30, 2013 and 2012, we recorded capital distributions of approximately $7.8 million and $14.5 million, respectively, related to the differences in net book value on the compression equipment that was exchanged with us. No customer contracts were included in the transfers. Under the terms of the Omnibus Agreement, such transfers must be of equal appraised value, as defined in the Omnibus Agreement, with any difference being settled in cash.   At June 30, 2013, we had equipment on lease to Exterran Holdings with an aggregate cost and accumulated depreciation of $4.2 million and $1.6 million, respectively. During the six months ended June 30, 2013 and 2012, we had revenue of $0.2 million and $0.4 million, respectively, from Exterran Holdings related to the lease of our compression equipment. During the six months ended June 30, 2013 and 2012, we had cost of sales of $3.2 million and $4.9 million, respectively, with Exterran Holdings related to the lease of Exterran Holdings’ compression equipment.   During the six months ended June 30, 2013, we sold compression equipment with a net book value of $1.3 million to Exterran Holdings for $3.4 million. Under GAAP, assets sales between entities under common control are to be initially recorded on the books of the receiving entity at the carrying value of the transferor. Any difference between consideration received and the carrying value of the assets sold is treated as a capital distribution or contribution. During the six months ended June 30, 2013, we recorded a capital contribution of $2.1 million related to the difference between the sales price and the carrying value of the compression equipment assets sold. During the six months ended June 30, 2012, we did not sell any compression equipment to Exterran Holdings.   Exterran Holdings provides all operational staff, corporate staff and support services reasonably necessary to run our business. The services provided by Exterran Holdings may include, without limitation, operations, marketing, maintenance and repair, periodic overhauls of compression equipment, inventory management, legal, accounting, treasury, insurance administration and claims processing, risk management, health, safety and environmental, information technology, human resources, credit, payroll, internal audit, taxes, facilities management, investor relations, enterprise resource planning system, training, executive, sales, business development and engineering.   We are charged costs incurred by Exterran Holdings that are directly attributable to us. Costs incurred by Exterran Holdings that are indirectly attributable to us and Exterran Holdings’ other operations are allocated among Exterran Holdings’ other operations and us. The allocation methodologies vary based on the nature of the charge and include, among other things, revenue and horsepower. We believe that the allocation methodologies used to allocate indirect costs to us are reasonable.   Under the Omnibus Agreement, Exterran Holdings has agreed that, for a period that will terminate on December 31, 2014, our obligation to reimburse Exterran Holdings for any cost of sales that it incurs in the operation of our business and any cash SG&A expense allocated to us will be capped (after taking into account any such costs we incur and pay directly). Cost of sales is capped at $21.75 per operating horsepower per quarter through December 31, 2013 and at $22.50 per operating horsepower per quarter from January 1, 2014 through December 31, 2014. SG&A costs were capped at $9.0 million per quarter from June 10, 2011 through March 7, 2012 and $10.5 million per quarter from March 8, 2012 through March 31, 2013, and are capped at $12.5 million per quarter from April 1, 2013 through December 31, 2013 and at $15.0 million per quarter from January 1, 2014 through December 31, 2014. These caps may be subject to future adjustment or termination in connection with expansion of our operations through the acquisition or construction of new assets or businesses.   Our cost of sales exceeded the cap provided in the Omnibus Agreement by $1.7 million and $3.5 million during the three months ended June 30, 2013 and 2012, respectively, and by $5.2 million and $8.8 million during the six months ended June 30, 2013 and 2012, respectively. Our SG&A expenses exceeded the cap provided in the Omnibus Agreement by $2.4 million and $2.8 million during the three months ended June 30, 2013 and 2012, respectively, and by $4.3 million and $5.3 million during the six months ended June 30, 2013 and 2012, respectively. The excess amounts over the caps are included in the condensed consolidated statements of operations as cost of sales or SG&A expense. The cash received for the amounts over the caps has been accounted for as a capital contribution in our condensed consolidated balance sheets and statements of cash flows.   </div>falsefalsefalsenonnum:textBlockItemTypenaThe entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39603-107864 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39622-107864 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Paragraph b -Article 3A Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(k)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph k -Article 4 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39691-107864 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39678-107864 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 57 -Paragraph 1-4 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. false0Related Party TransactionsfalseRelated Party TransactionsUnKnownUnKnownUnKnownUnKnowntruefalsefalseSheethttp://www.exterran.com/role/DisclosureRelatedPartyTransactions12