Document:

ex_173341.htm

Exhibit 10.8

 

 

March 29, 2019

 

 

Andy Woodward  

	
			216 Inslee Ave

			
	
			San Antonio, TX 78209

			

Email: woodward.andy@gmail.com

 

 

 

Dear Andy:

 

On behalf of the management team at BKEP Management, Inc. (BKEP), it is my pleasure to extend an offer of employment to you. I know you will make a significant contribution to our team. Information regarding your compensation and benefits package is below:

 

 

	
			Job Information

				
			Your job title will be Chief Financial Officer and the role will serve as an Officer in the Company. You will office out of our Tulsa, OK office. You will report directly to Mark Hurley, CEO.  

			 

			You will be employed by BKEP Management, Inc., which is the U.S. provider of services to Blueknight Energy Partners, L.P.

			 

			
	
			Compensation

			 

				
			Annual base salary of $350,000 per year to be paid on a bi-monthly basis on the 15th and last day of the month in the amount of $14,583.33 for each pay period worked.

			 

			As a fulltime employee, you will be eligible to participate in the Company’s annual Cash Bonus Incentive Program and our annual Long-Term Incentive Program (LTIP), both programs currently have a 50% of base target for your level of employment. Participation is each program is discretionary based on Company and individual level of performance.

			 

			For the 2019 performance year, you are guaranteed a minimum end-of year performance cash bonus in the amount of $160,000. Additionally, you will receive a minimum of $160,000 worth of Long-Term Incentive units (LTI) as part of the 2020-22 Program. LTI may be paid in BKEP units or cash equivalent. Cash bonus and LTI phantom units are payable in full on the regularly scheduled March 2020 bonus payout date.

			 

			You will receive a sign-on bonus consisting of both cash and LTI units. A cash bonus payment will be made in the amount of $50,000 payable in one lump sum on your first paycheck following 90 days of employment. Additionally, you will receive $50,000 worth of LTI units. LTI grant will be awarded following 30 days of employment. Unit grant price will be determined by using the average market closing price of the last three market days in May 2019.  

			 

			Your eligibility for all bonus and LTI payments is based on your being employed in good standing on the date of payment. All bonus and LTI payments are subject to all applicable taxes and withholdings. 

			

			 

			 

			 

			

 

 

 

 

	 	
			Additionally, you are eligible for Make-Whole Payments. Payments in the amount specified in Table A (below) under Payment Amount will be paid to you on each listed Payment Date. You are only entitled to a Make-Whole Payment if you have been continuously employed in good standing by BKEP until each applicable payment date. In the event BKEP ends your employment for any reason other than for cause prior to all payments being made to you, a lump-sum payment equal to the amount of the unpaid Make-Whole Payments will be paid within 10 days of termination and is conditioned on the execution by you of a release of all employment-related claims within the applicable period following the date of termination provided in such release that is not revoked by you during any applicable revocation period. In the event you end your employment for any reason, including by death or total disability, no un-paid balance of Make-Whole Payments will be paid.

			 

			Table A: Make-Whole-Payments

			

 

	Payment Date	Payment
	December 31, 2019	$150,000
	December 31, 2020	$200,000
	December 31, 2021	$200,000
	Total Make-Whole Payments:	$550,000

 

	Relocation Assistance	
			Company agrees to reimburse you for normal business travel expenses (up to 2 people) per our travel policy for one house hunting trip to Tulsa, OK including airfare, overnight (up to 2 nights), car rental, and meals.

			 

			Company agrees you will be able to commute between San Antonio, TX and Tulsa, OK through June 30, 2019 with the expectation that you will work from Tulsa the vast majority of those days. During this time, Company agrees to pay for one round trip coach airfare each week; overnight accommodations up to five nights each week and ground transportation up to five days while in Tulsa. All meals are excluded.

			 

			Additionally, you will receive relocation assistance in the amount of $45,000, or an amount mutually agreed between you and the Company based on actual expenses subject to the terms and conditions of your Relocation Agreement.  

			 

			
	
			Employee Benefits

				
			As a full-time employee, you will be eligible to participate in the BKEP employee benefit program. BKEP offers a competitive array of employee benefits, including medical, dental/vision, disability, base life, optional life, optional AD&D, 401(k), cafeteria plan, as well as paid time off benefits.

			 

			Your eligibility to participate in the Company’s employee benefit plans is governed by applicable laws and the benefit plan documents, both of which can change at any time.

			 

			Please refer to the attached benefits brochure for further details.

			 

			

 

 

 

 

	
			Additional Benefits

				
			In addition to our employee medical coverage, you will be eligible to participate in our Supplemental Medical Reimbursement Plan. Please see the attached Plan overview for additional benefit information.

			 

			
	
			Benefits Effective Date

				
			You will be eligible to participate in the Company’s benefit plans on the first of the month immediately following your hire date. Please remember you must enroll in the benefit plans within 30 days after your hire date or you will not have coverage.

			 

			
	
			Paid-Time-Off (PTO)

				
			You will be eligible to use 22 days of PTO annually during your first through twentieth year of service (amount is prorated for year one based on hire date). After twenty years of continuous service, your available paid vacation will follow the current Vacation Policy as described in the Employee Handbook.

			 

			If you leave the Company for any reason prior to one year of service, you will not be paid the remaining balance of paid time off.

			 

			
	Employment Agreement	
			You will receive an Employment Agreement as soon as administratively feasible following 90 days of employment. The terms of the Agreement will include but not limited to one-year base pay and continuation of applicable employee benefits for one year should you have a loss of employment occur through no fault of your own. If there is a change of control resulting in your loss of employment, the base pay benefit extends to 24 months of pay. Terms of the LTIP Agreement include accelerated vesting of phantom LTI units in the event of loss of employment that occurs through no fault of your own.

			 

			
	Hire Date	
			April 29, 2019

			 

			
	Contingency	
			This offer of employment is contingent upon successful completion of a background check and pre-employment drug screen. You will be given information regarding your pre-employment drug screen and background check upon acceptance of this offer.

			 

			Please complete the attached consent form and return it to me by email at kveit@bkep.com or by fax at 918-237-4002. Once this information is received he will have our vendor set up your appointment date, time and location. Vender will be sending you a confirmation email with the paperwork that you must take with you to your appointment.

			

 

On behalf of the Blueknight Energy Partners Management Team, we look forward to working with you in the future. If you have any questions regarding this offer of employment, please feel free to call me. To confirm acceptance of our employment offer, please complete the acknowledgement section below and forward the original signed version of this letter to my attention.

 

Sincerely,

 

/s/ Kevin Veit

Kevin Veit

Vice President of Human Resources

Blueknight Energy Partners, L.P.

 

 

 

 

 

ACKNOWLEDGEMENT

 

Check One:

	 	
			☒

				
			Offer Accepted

			

	 	
			☐

				
			Offer Declined

			

 

	David Andrew Woodward	[Redacted]
	Print Name (as it appears on your Social Security card) 	 Social Security Number
	 	 
	/s/ David Andrew Woodward	3/31/2019
	Signature 	Date

 

                                 

 

 

 

Send faxed or scanned acknowledgments to: 918 237- 4002 or to kveit@bkep.comex_173342.htm

Exhibit 10.11

 

 

BLUEKNIGHT ENERGY PARTNERS G.P., L.L.C.

LONG-TERM INCENTIVE PLAN

 

EMPLOYEE PHANTOM UNIT AGREEMENT

 

This Phantom Unit Agreement (“Agreement”) is between Blueknight Energy Partners G.P., L.L.C. (the “Company”) and Mark Hurley (the “Participant”), regarding an award (“Award”) of 61,448 Phantom Units (as defined in the Blueknight Energy Partners G.P., L.L.C. Long-Term Incentive Plan (the “Plan”)) granted to the Participant on January 1, 2018 (the “Grant Date”), such number of Phantom Units subject to adjustment as provided in the Plan, and further subject to the following terms and conditions:

 

1.     Relationship to Plan. This Award is subject to all of the terms, conditions and provisions of the Plan and administrative interpretations thereunder, if any, which have been adopted by the Committee thereunder and are in effect on the date hereof. Except as otherwise provided herein, capitalized terms shall have the same meanings ascribed to them under the Plan.

 

2.     Definitions.

 

“Cause” means (i) conviction of the Participant by a court of competent jurisdiction of any felony or a crime involving moral turpitude; (ii) the Participant’s willful and intentional failure or willful and intentional refusal to follow reasonable and lawful instructions of the Board; (iii) the Participant’s material breach or default in the performance of his obligations under this Agreement; or (iv) the Participant’s act of misappropriation, embezzlement, intentional fraud or similar conduct involving the Company or any of its Affiliates.

 

“Disability” means the Participant either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months or (ii) the Participant is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company or any entity that would be considered a single “service recipient” with the Company pursuant to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).

 

“Retirement” means the Participant’s employment with the Company and all its Affiliates terminates (other than due to death, Disability or Cause) on or after he attains age 57 with at least five years of service with the Company or its Affiliates.

 

3.     Vesting Schedule; Settlement.

 

(a)     The Phantom Units subject to this Award shall vest as follows: January 1, 2019, such vesting date, (the “Vesting Date”). The Participant must be continuously employed with the Company or any of its Affiliates from the Grant Date through December 31, 2018 Vesting Date in order for the Award to become vested with respect to the Phantom Units on such date.

 

 

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(b)     Notwithstanding any provision in the Plan to the contrary, (i) the occurrence of a Change of Control shall have no effect on the vesting of the Phantom Units and (ii) following the occurrence of a Change of Control, the Phantom Units shall continue to vest in accordance with this Agreement.

 

(c)     Within 60 days following vesting with respect to a Phantom Unit, the Participant shall be entitled to receive a Common Unit. Common Units will be evidenced, at the sole option and in the sole discretion of the Committee, either (i) in book-entry form in the Participant’s name in the Common Unit register of the Partnership maintained by the Partnership’s transfer agent or (ii) a unit certificate issued in the Participant’s name. Upon delivery of a Common Unit in respect of a Phantom Unit, such Phantom Unit shall cease to be outstanding in the Participant’s notional account described below in Section 5.

 

4.     Forfeiture of Award.

 

(a)     If the Participant’s employment with the Company and all Affiliates is terminated by Participant’s employer without Cause (and, for the avoidance of doubt, not due to Retirement), or by reason of death or Disability, all unvested Phantom Units shall immediately vest and the Restricted Period shall terminate as of the date of the Participant’s termination.

 

(b)     If the Participant’s employment with the Company and all Affiliates is terminated due to Retirement, the unvested Phantom Units shall not be forfeited and shall instead continue to vest and be payable in accordance with this Agreement as if the Participant had remained continuously employed by the Company or an Affiliate.

 

(c)     If the Participant’s employment with the Company and all Affiliates terminates for any reason not described in Section 4(a) or 4(b), all unvested Phantom Units shall be immediately forfeited as of the date of the Participant’s termination.

 

Immediate vesting of units under Section 4.(a), other than by reason of death, are conditioned on the execution by the Participant of a release of all employment-related claims within the applicable period following the Participant’s date of termination provided in such release that is not revoked by the Participant during any applicable revocation period provided in such release; provided, however, that such release shall be contingent upon the Company’s satisfaction of all terms and conditions of this Section.

 

 

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5.     Distribution Equivalent Rights. During the Restricted Period, the Award of Phantom Units hereunder shall be evidenced by entry in a bookkeeping account and shall include a tandem Distribution Equivalent Right with respect to the Phantom Units. Distribution Equivalent Rights shall only be paid with respect to ordinary quarterly cash distributions and shall not be paid with respect to any special, make-up or extraordinary distributions, in each case as determined by the Committee in its sole discretion. Notwithstanding the foregoing, no Distribution Equivalent Rights shall be paid in excess of the Minimum Quarterly Distributions (as defined in the Partnership Agreement) during the one year period following the Grant Date. Pursuant to the Distribution Equivalent Right, within 45 days following the end of each fiscal quarter for which a cash distribution is made with respect to Common Units, the Participant shall be entitled to receive a cash payment with respect to each Phantom Unit then outstanding equal to the cash distribution made by the Partnership with respect to each Common Unit. 

 

6.     Rights as Unitholder; Delivery of Common Units. Until delivery of Common Units as described in Section 3(c), the Participant shall have no rights as a unitholder as a result of the grant of Phantom Units hereunder. The Company shall not be obligated to deliver any Common Units if counsel to the Company determines that such sale or delivery would violate any applicable law or any rule or regulations of any governmental authority or any rule or regulation of, or agreement of the Company with, any securities exchange or association upon which the Common Units are listed or quoted. The Company shall in no event be obligated to take any affirmative action in order to cause the delivery of Common Units to comply with any such law, rule, regulations or agreement.

 

7.     Assignment of Award. The Participant’s rights under this Agreement and the Plan are personal; no assignment or transfer of the Participant’s rights under and interest in this Award may be made by the Participant other than by will, by beneficiary designation, by the laws of descent and distribution or by a qualified domestic relations order.

 

8.     Withholding. No certificates representing Common Units hereunder shall be delivered to or in respect of a Participant unless the amount of all federal, state and other governmental withholding tax requirements imposed upon the Company with respect to the issuance of such Common Units has been remitted to the Company or unless provisions to pay such withholding requirements have been made to the satisfaction of the Committee. The Committee may make such provisions as it may deem appropriate for the withholding of any taxes which it determines is required in connection with this Award. The Participant may pay all or any portion of the taxes required to be withheld by the Company or paid by the Participant in connection with the vesting of all or any portion of this Award by delivering cash, or, with the Committee’s approval, by electing to have the Company withhold Common Units, or by delivering previously owned Common Units, having a Fair Market Value equal to the amount required to be withheld or paid. The Participant may only request the withholding of Common Units having a Fair Market Value equal to the statutory minimum withholding amount. The Participant must make the foregoing election on or before the date that the amount of tax to be withheld is determined.

 

9.     No Employment Guaranteed. No provision of this Agreement shall confer any right upon the Participant to continued employment with the Company or any Affiliate.

 

 

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10.     Governing Law. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware.

 

11.     Amendment. This Agreement cannot be modified, altered or amended, except by an agreement, in writing, signed by both the Company and the Participant.

 

12.     Section 409A.

 

(a)     The Phantom Units granted pursuant to this Agreement are intended to comply with or be exempt from Code Section 409A, and ambiguous provisions hereof, if any, shall be construed and interpreted in a manner consistent with such intent. No payment, benefit or consideration shall be substituted for the Phantom Units if such action would result in the imposition of taxes under Code Section 409A. Notwithstanding anything in this Agreement to the contrary, if any Plan provision or this Agreement results in the imposition of an additional tax under Code Section 409A, that Plan provision or provision of this Agreement shall be reformed, to the extent permissible under Code Section 409A, to avoid imposition of the additional tax, and no such action shall be deemed to adversely affect the Participant’s rights to the Phantom Units.

 

(b)     Notwithstanding any provision of the Agreement to the contrary, if the Participant is identified by the Company as a “specified employee” within the meaning of Code Section 409A(a)(2)(B)(i) on the date on which the Participant has a “separation from service” (other than due to death) within the meaning of Treasury Regulation § 1.409A-1(h), the Phantom Units payable or settled on account of a separation from service that are deferred compensation subject to Code Section 409A shall be paid or settled on the earliest of (i) the first business day following the expiration of six months from the Participant’s separation from service, (ii) the date of the Participant’s death, or (iii) such earlier date as complies with the requirements of Code Section 409A.

 

(c)     For all purposes of this Agreement, the Participant shall be considered to have terminated employment with the Company and its Affiliates when the Participant incurs a “separation from service” with the Company within the meaning of Treasury Regulation § 1.409A-1(h).

 

 

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IN WITNESS WHEREOF, the Company and the Participant have executed this Phantom Unit Agreement as of the dates set forth below.

 

 

 

Blueknight Energy Partners G.P., L.L.C.

 

 

	By:	/s/ Alex Stallings
	Name:	Alex Stallings
	Title:	Chief Financial Officer and Secretary
	Date:	3/7/18

 

 

 

Participant:

 

	/s/ Mark A. Hurley
	Name:	Mark A. Hurley
	Date:	3/7/18

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Phantom Unit Agreement

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