Exhibit 10.16
As SemGroup Energy Partners
Management, Inc. (the “ Company ”) and SemGroup
Energy Partners G.P., L.L.C. (“ SGGP ”) believe
it is in the best interests of the Company, SGGP and SemGroup
Energy Partners, L.P. (“ SGLP ”) to encourage
you to remain in the employ of the Company, the Company hereby
agrees, and SGGP and SGLP guarantee, as of the date set forth above
(the “ Effective Date ”), to provide you
retention payments totaling up to $180,000, which is equivalent to
1.2 times your current annual base salary, (your “
Retention Opportunity ”), subject to the terms and
conditions more fully set forth below in this letter agreement
(this “ Agreement ”).
(a) If you remain
employed until October 30, 2008 (the “ First Retention
Date ”), you will be paid a lump sum retention payment
equal to $45,000, which is 25% of your Retention Opportunity,
within 30 days following the First Retention Date.
(b) If you remain
employed until July 31, 2009 (the “ Final Retention
Date ”), you will be paid an additional lump sum
retention payment equal to $135,000, which is 75% of your Retention
Opportunity, within 30 days following the Final Retention
Date.
(c) If your employment
is (1) terminated by the Company other than for Cause prior to the
Final Retention Date or (2) voluntarily terminated by you for Good
Reason, then you will be paid a lump sum retention payment equal to
your Retention Opportunity, reduced by the amount of any payment
you may have already received under Section 1(a) above, within 30
days following the date of your termination. For
purposes of this Agreement, “ Cause ” means
termination of employment by the Company due to failure to perform
your duties in good faith, misconduct which violates a written
company policy, breach of this Agreement, gross negligence,
dishonesty, or intentional acts detrimental or destructive to the
Company or its affiliates, employees or property. For
purposes of this Agreement, “ Good Reason ”
means (i) a material reduction in the your base salary, (ii) a
material diminution of your duties, authority or responsibilities
as in effect immediately prior to such diminution or (iii) the
relocation of the your principal work location to a location more
than 50 miles from its current location. In order to be
eligible for payment on account of a Good Reason termination, you
must: (i) provide written notice to the Company within 90 days
following the first event or condition which gives rise to your
claim of Good Reason under this section; (ii) provide the Company
30 days from the date of such notice in which to “cure”
such event or condition and (iii) actually terminate employment
within 30 days following the expiration of the cure period
described above.
(d) For the avoidance
of doubt, if you voluntarily terminate your employment other than
for Good Reason or are fired for Cause prior to the First Retention
Date or the Final Retention Date, the payments otherwise payable on
any date following the date of your termination will be
forfeited. For purposes of this Agreement, employment
with the Company or any affiliate shall be considered employment
with the Company.
2.
Confidentiality . The Company has provided and
will continue to provide you with Confidential Information
regarding the Company and the Company’s business and has
agreed to make certain payments pursuant to Section 1
hereof. In return for this and the other consideration
provided under this Agreement, you agree that you will not disclose
or make available to any other person or entity, or use for your
own personal gain, any Confidential Information, except for such
disclosures as required (i) by law or legal process, (ii) in the
performance of your obligations hereunder, (iii) in connection with
the enforcement of your rights under this Agreement, or (iv) in
connection with the defense or settlement of any claim, suit or
action brought against you by the Company or any other party;
provided, however, that if disclosure of Confidential Information
is required pursuant to (i) or (iv) above, you shall give
prom
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