Contract
Exhibit 3.2
SECOND
AMENDED AND RESTATED
OF
BLUEKNIGHT
ENERGY PARTNERS G.P., L.L.C.
A
Delaware Limited Liability Company
Dated
as of
December
1, 2009
TABLE
OF CONTENTS
|
|||
1
|
|||
SECTION
1.01
|
1
|
||
SECTION
1.02
|
8
|
||
9
|
|||
SECTION
2.01
|
9
|
||
SECTION
2.02
|
9
|
||
SECTION
2.03
|
9
|
||
SECTION
2.04
|
9
|
||
SECTION
2.05
|
9
|
||
SECTION
2.06
|
9
|
||
SECTION
2.07
|
10
|
||
11
|
|||
SECTION
3.01
|
11
|
||
SECTION
3.02
|
11
|
||
SECTION
3.03
|
12
|
||
SECTION
3.04
|
12
|
||
SECTION
3.05
|
12
|
||
SECTION
3.06
|
12
|
||
SECTION
3.07
|
12
|
||
SECTION
3.08
|
13
|
||
SECTION
3.09
|
13
|
||
13
|
|||
SECTION
4.01
|
13
|
||
SECTION
4.02
|
13
|
||
SECTION
4.03
|
13
|
||
14
|
|||
SECTION
5.01
|
14
|
||
SECTION
5.02
|
14
|
||
SECTION
5.03
|
14
|
||
SECTION
5.04
|
14
|
i
15
|
|||
SECTION
6.01
|
15
|
||
SECTION
6.02
|
15
|
||
SECTION
6.03
|
15
|
||
SECTION
6.04
|
17
|
||
SECTION
6.05
|
17
|
||
SECTION
6.06
|
17
|
||
18
|
|||
SECTION
7.01
|
18
|
||
SECTION
7.02
|
18
|
||
SECTION
7.03
|
19
|
||
SECTION
7.04
|
19
|
||
SECTION
7.05
|
19
|
||
SECTION
7.06
|
19
|
||
SECTION
7.07
|
19
|
||
SECTION
7.08
|
19
|
||
SECTION
7.09
|
20
|
||
SECTION
7.10
|
20
|
||
SECTION
7.11
|
21
|
||
SECTION
7.12
|
21
|
||
21
|
|||
SECTION
8.01
|
21
|
||
SECTION
8.02
|
22
|
||
SECTION
8.03
|
22
|
||
SECTION
8.04
|
22
|
||
SECTION
8.05
|
22
|
||
SECTION
8.06
|
22
|
||
SECTION
8.07
|
23
|
||
SECTION
8.08
|
23
|
||
SECTION
8.09
|
23
|
||
SECTION
8.11
|
24
|
||
24
|
|||
SECTION
9.01
|
24
|
||
SECTION
9.02
|
25
|
ii
26
|
|||
SECTION
10.01
|
26
|
||
SECTION
10.02
|
26
|
||
SECTION
10.03
|
26
|
||
26
|
|||
SECTION
11.01
|
26
|
||
SECTION
11.02
|
27
|
||
SECTION
11.03
|
27
|
||
27
|
|||
SECTION
12.01
|
27
|
||
SECTION
12.02
|
28
|
||
SECTION
12.03
|
29
|
||
SECTION
12.04
|
29
|
||
29
|
|||
SECTION
13.01
|
29
|
||
SECTION
13.02
|
29
|
||
SECTION
13.03
|
30
|
||
SECTION
13.04
|
30
|
||
SECTION
13.05
|
30
|
||
SECTION
13.06
|
30
|
||
SECTION
13.07
|
30
|
||
SECTION
13.08
|
31
|
||
SECTION
13.09
|
31
|
||
SECTION
13.10
|
31
|
||
SECTION
13.11
|
31
|
||
iii
SECOND
AMENDED AND RESTATED
OF
BLUEKNIGHT
ENERGY PARTNERS G.P., L.L.C.
This SECOND AMENDED AND RESTATED LIMITED
LIABILITY COMPANY AGREEMENT (this “Agreement”) of BLUEKNIGHT
ENERGY PARTNERS G.P., L.L.C. (the “Company”), dated as of
December 1, 2009, is adopted, executed and agreed to by BlueKnight Energy
Holding, Inc., a Delaware corporation (“BKEP Holdings”), as the sole
Member of the Company.
R
E C I T A L S:
WHEREAS,
the Company was formed as a Delaware limited liability company on February 22,
2007.
WHEREAS,
the Amended and Restated Limited Liability Company Agreement of SemGroup Energy
Partners G.P., L.L.C. was executed effective July 20, 2007 (the “Amended and Restated Limited
Liability Company Agreement”).
WHEREAS,
the sole Member of the Company deems it advisable to amend and restate the
Amended and Restated Limited Liability Company Agreement in its entirety as set
forth herein.
NOW
THEREFORE, for and in consideration of the premises, the covenants and
agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, BKEP Holdings, as the
sole Member of the Company, hereby amends and restates the Amended and Restated
Limited Liability Company Agreement in its entirety as follows:
DEFINITIONS
SECTION
1.01 Definitions.
(a) As used
in this Agreement, the following terms have the respective meanings set forth
below or set forth in the Sections referred to below:
“Act” means the Delaware
Limited Liability Company Act (Delaware General Corporations Code
Sections 18-101, et seq.), as it may be amended from time to time, and any
corresponding provisions of succeeding law. All references in this
Agreement to provisions of the Act shall be deemed to refer, if applicable, to
their successor statutory provisions to the extent appropriate in light of the
context herein in which such references are used
“Adjusted Capital Account
Deficit” means, with respect to any Member, the deficit balance, if any,
in such Member’s Capital Account as of the end of the relevant fiscal year,
after giving effect to the following adjustments:
1
(i) Credit to
such Capital Account any amounts which such Member is obligated to restore
pursuant to any provision of this Agreement or pursuant to Treasury
Regulation Section 1.704-1(b)(2)(ii)(c) or is deemed to be obligated
to restore pursuant to the penultimate sentences of Treasury Regulations
Sections 1.704-2(g)(1) and 1.704-2(i)(5); and
(ii) Debit to
such Capital Account the items described in Treasury Regulation Sections
1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), and
1.704-1(b)(2)(ii)(d)(6).
The foregoing definition of Adjusted
Capital Account Deficit is intended to comply with the provisions of Treasury
Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted
consistently therewith.
“Affiliate” means, with
respect to any Person, any other Person that directly or indirectly through one
or more intermediaries controls, is controlled by or is under common control
with, the Person in question. As used herein, the term “control” means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.
“Agreement” has the meaning
given such term in the introductory paragraph, as the same may be amended,
modified, supplemented or restated from time to time.
“Applicable Law” means
(a) any United States federal, state or local law, statute or ordinance or
any rule, regulation, order, writ, injunction, judgment, decree or permit of any
Governmental Authority and (b) any rule or listing requirement of any
applicable national stock exchange or listing requirement of any national stock
exchange or Commission recognized trading market on which securities issued by
the Partnership are listed or quoted.
“Assignee” means any Person
that acquires a Member’s share of the income, gain, loss, deduction and credits
of, and the right to receive distributions from, the Company or any portion
thereof through a Disposition; provided, however, that an Assignee
shall have no right to be admitted to the Company as a Member except in
accordance with Article IV. The Assignee of a dissolved Member is the
shareholder, partner, member or other equity owner or owners of the dissolved
Member to whom such Member’s Membership Interest is assigned by the Person
conducting the liquidation or winding up of such Member.
“Audit Committee” has the
meaning given such term in Section 7.10(b).
“Bankruptcy” or “Bankrupt” means, with respect
to any Person, that (a) such Person (i) makes a general assignment for
the benefit of creditors; (ii) files a voluntary bankruptcy petition; (iii)
becomes the subject of an order for relief or is declared insolvent in any
federal or state bankruptcy or insolvency proceedings; (iv) files a
petition or answer seeking for such Person a reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under any
Applicable Law; (v) files an answer or other pleading admitting or failing
to contest the material allegations of a petition filed against such Person in a
proceeding of the type described in subclauses (i) through (iv) of
this clause (a); or (vi) seeks, consents to, or acquiesces in the
appointment of a trustee, receiver, or liquidator of such Person or of all or
any substantial part of such Person’s properties; or (b) a proceeding
seeking reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any Applicable Law has been commenced
against such Person and 120 Days have expired without dismissal thereof or with
respect to which, without such Person’s consent or acquiescence, a trustee,
receiver, or liquidator of such Person or of all or any substantial part of such
Person’s properties has been appointed and 90 Days have expired without the
appointment’s having been vacated or stayed, or 90 Days have expired after the
date of expiration of a stay, if the appointment has not previously been
vacated. The foregoing definition of “Bankruptcy” is intended to replace and
shall supercede and replace the definition of “Bankruptcy” set forth in the
Act.
2
“BKEP Holdings” has the
meaning given such term in the introductory paragraph.
“Board” has the meaning given
such term in Section 7.01(c).
“Business Day” means any Day
other than a Saturday, a Sunday, or a day when banks in New York, New York or
Tulsa, Oklahoma are authorized or required by Applicable Law to be
closed.
“Capital Account” means, with
respect to any Member, the Capital Account maintained for such Member in
accordance with the following provisions:
(i) To each
Member’s Capital Account there shall be credited such Member’s Capital
Contributions, such Member’s distributive share of Profits and any items in the
nature of income or gain that are specially allocated pursuant to
Section 6.03(d) hereof, and the amount of any Company liabilities assumed
by such Member or that are secured by any property (other than money)
distributed to such Member.
(ii) To each
Member’s Capital Account there shall be debited the amount of cash and the Gross
Asset Value of any property (other than money) distributed to such Member
pursuant to any provision of this Agreement, such Member’s distributive share of
Losses and any items in the nature of expenses or losses that are specially
allocated pursuant to Section 6.03(d) hereof, and the amount of any
liabilities of such Member assumed by the Company or that are secured by any
property (other than money) contributed by such Member to the
Company.
(iii) If all or
a portion of a Membership Interest is transferred in accordance with the terms
of this Agreement, the transferee shall succeed to the Capital Account of the
transferor to the extent it relates to the Membership Interest so
transferred.
(iv) In
determining the amount of any liability for purposes of the foregoing
subparagraphs (i) and (ii) of this definition of “Capital Account,”
Section 752(c) of the Code and any other applicable provisions of the Code and
Treasury Regulations shall be taken into account.
The foregoing provisions and the
other provisions of this Agreement relating to the maintenance of Capital
Accounts are intended to comply with Treasury Regulations
Section 1.704-1(b) and shall be interpreted and applied in a manner
consistent with such Treasury Regulations.
“Capital Contribution” means,
with respect to any Member, the amount of money and the net agreed value of any
property (other than money) contributed to the Company by such Member. Any
reference in this Agreement to the Capital Contribution of a Member shall
include any Capital Contribution of its predecessors in interest.
“Certificate” means a
certificate, in such form as may be adopted by the Board, issued by the Company
evidencing ownership of one or more Units.
3
“Certified Public Accountants”
means a firm of independent public accountants selected from time to time by the
Board.
“Claim” means any and all
judgments, claims, causes of action, demands, lawsuits, suits, proceedings,
Governmental investigations or audits, losses, assessments, fines, penalties,
administrative orders, obligations, costs, expenses, liabilities and damages
(whether actual, consequential or punitive), including interest, penalties,
reasonable attorneys’ fees, disbursements and costs of investigations,
deficiencies, levies, duties and imposts.
“Code” means the Internal
Revenue Code of 1986, as amended from time to time.
“Commission” means the United
States Securities and Exchange Commission.
“Company” has the meaning
given such term in the introductory paragraph.
“Compensation Committee” has
the meaning given such term in Section 7.10(d).
“Conflicts Committee” has the
meaning given such term in Section 7.10(c).
“Controlling Entities” means
the sole Member and its Affiliates (other than the Company and the Partnership
Group).
“Day” means a calendar day;
provided, however, that, if any period
of Days referred to in this Agreement shall end on a Day that is not a Business
Day, then the expiration of such period shall be automatically extended until
the end of the next succeeding Business Day.
“Delaware Certificate” has the
meaning given such term in Section 2.01.
“Depreciation” means, for each
fiscal year or other period, an amount equal to the depreciation, amortization,
or other cost recovery deduction allowable with respect to an asset for such
year or other period, except that if the Gross Asset Value of an asset differs
from its adjusted basis for Federal income tax purposes at the beginning of such
year or other period, Depreciation shall be an amount which bears the same ratio
to such beginning Gross Asset Value as the Federal income tax depreciation,
amortization, or other cost recovery deduction for such year or other period
bears to such beginning adjusted tax basis; provided, however, that, if the
Federal income tax depreciation, amortization, or other cost recovery deduction
for such year is zero, Depreciation shall be determined with reference to such
beginning Gross Asset Value using any reasonable method selected by the Board
and; provided, further, if such asset is
subject to adjustments under the remedial allocation method of Treasury
Regulation Section 1.704-3(d), Depreciation shall be determined under Treasury
Regulation Section 1.704-3(d)(2).
“Director” or “Directors” means a member or
members of the Board.
“Dispose,” “Disposing” or “Disposition” means with
respect to any asset (including a Membership Interest or any portion thereof), a
sale, assignment, transfer, conveyance, gift, exchange or other disposition of
such asset, whether such disposition be voluntary, involuntary or by operation
of Applicable Law.
4
“Disposing Member” has the
meaning given such term in Section 4.02.
“Dissolution Event” has the
meaning given such term in Section 12.01(a).
“Encumber,” “Encumbering,” or “Encumbrance” means the
creation of a security interest, lien, pledge, mortgage or other encumbrance,
whether such encumbrance be voluntary, involuntary or by operation of Applicable
Law.
“GAAP” means generally
accepted accounting principles as applied in the United States.
“Governmental Authority” or
“Governmental” means
any federal, state or local court or governmental or regulatory agency or
authority or any arbitration board, tribunal or mediator having jurisdiction
over the Company or its assets or Members.
“Group Member” has the meaning
set forth in the Partnership Agreement.
“Gross Asset Value” means,
with respect to any asset, the asset’s adjusted basis for federal income tax
purposes, except as follows:
(i) The
initial Gross Asset Value of any asset contributed by a Member to the Company
shall be the gross fair market value of said asset, as determined by the
contributing Member and the Board, in a manner that is consistent with Section
7701(g) of the Code;
(ii) The Gross
Asset Values of all Company assets shall be adjusted to equal their respective
gross fair market values, as determined by the Board, in a manner that is
consistent with Section 7701(g) of the Code, as of the following times:
(a) the acquisition of an additional Membership Interest by any new or
existing Member in exchange for more than a de minimis Capital Contribution or
as consideration for the performance of services on behalf of the Company;
(b) the distribution by the Company to a Member of more than a de minimis
amount of property other than money as consideration for an Membership Interest;
and (c) the liquidation of the Company within the meaning of Treasury
Regulations Section 1.704-1(b)(2)(ii)(g); provided, however, that
adjustments pursuant to clauses (a) and (b) above shall be made only if the
Board reasonably determines that such adjustments are necessary or appropriate
to reflect the relative economic interests of the Members in the
Company;
(iii) The Gross
Asset Value of any Company asset distributed to any Member shall be the gross
fair market value (taking Section 7701(g) of the Code into account) of such
asset on the date of distribution; and
(iv) The Gross
Asset Values of any Company assets shall be increased (or decreased) to reflect
any adjustments to the adjusted basis of such assets pursuant to Section 734(b)
of the Code or Section 743(b) of the Code, but only to the extent that such
adjustments are taken into account in determining Capital Accounts pursuant to
Treasury Regulations Section 1.704-1(b)(2)(iv)(m) and the definition of Capital
Account hereof;
provided,
however, that Gross Asset Values shall not be adjusted pursuant to this
subparagraph (iv) to the extent the Tax Matter Officer determines that an
adjustment pursuant to the foregoing subparagraph (ii) of this definition
is necessary or appropriate in connection with a transaction that would
otherwise result in an adjustment pursuant to this subparagraph
(iv).
5
If the
Gross Asset Value of an asset has been determined or adjusted pursuant to the
foregoing subparagraphs (i), (ii) or (iv), such Gross Asset Value shall
thereafter be adjusted by the Depreciation taken into account with respect to
such asset for purposes of computing Profits and Losses.
“Incentive Plan” means any
plan or arrangement pursuant to which the Company may compensate its employees,
consultants, directors and/or service providers.
“Indemnitee” means
(a) any Person who is or was an Affiliate of the Company (other than the
Partnership and its Subsidiaries), (b) any Person who is or was a member,
partner, officer, director, employee, agent or trustee of the Company or any
Affiliate of the Company, (c) any Person who is or was serving at the
request of the Company or any Affiliate of the Company as an officer, director,
employee, member, partner, agent, fiduciary or trustee of another Person; provided, however, that a Person shall
not be an Indemnitee by reason of providing, on a fee-for-services basis,
trustee, fiduciary or custodial services and (d) any Person the Company
designates as an “Indemnitee” for purposes of this Agreement.
“Independent Director” has the
meaning given such term in Section 7.10(b).
“Limited Partner” and “Limited Partners” shall have
the meaning given such terms in the Partnership Agreement.
“Majority Interest” means
Membership Interests in the Company entitled to more than 50% of the Sharing
Ratios.
“Member” means any Person
executing this Agreement as of the date of this Agreement as a member of the
Company or hereafter admitted to the Company as a member as provided in this
Agreement, but such term does not include any Person who has ceased to be a
member in the Company.
“Membership Interest” means,
with respect to any Member, (a) that Member’s status as a Member;
(b) that Member’s share of the income, gain, loss, deduction and credits
of, and the right to receive distributions from, the Company; (c) all other
rights, benefits and privileges enjoyed by that Member (under the Act, this
Agreement, or otherwise) in its capacity as a Member, including that Member’s
rights to vote, consent and approve and otherwise to participate in the
management of the Company; and (d) all obligations, duties and liabilities
imposed on that Member (under the Act, this Agreement or otherwise) in its
capacity as a Member, including any obligations to make Capital
Contributions.
“Notices” has the meaning
given such term in Section 13.02.
“Omnibus Agreement” has the
meaning given such term in the Partnership Agreement.
“Original Limited Liability Company
Agreement” has the meaning given such term in the Recitals.
“Partnership” means Blueknight
Energy Partners, L.P., a Delaware limited partnership.
6
“Partnership Agreement” means
the Second Amended and Restated Agreement of Limited Partnership of the
Partnership, dated as of December 1, 2009, as it may be further amended and
restated, or any successor agreement.
“Partnership Group” means the
Partnership and its Subsidiaries treated as a single consolidated
entity.
“Person” means an individual
or a corporation, firm, limited liability company, partnership, joint venture,
trust, unincorporated organization, association, government agency or political
subdivision thereof or other entity.
“Profits” and “Losses” means, for each
fiscal year or other period, an amount equal to the Company’s taxable income or
loss for such year or period, determined in accordance with Section 703(a) of
the Code (for this purpose, all items of income, gain, loss, or deduction
required to be stated separately pursuant to Section 703(a)(1) of the Code
shall be included in taxable income or loss), with the following
adjustments:
(i) Any
income of the Company that is exempt from federal income tax and not otherwise
taken into account in computing Profits or Losses pursuant to this definition
shall be added to such taxable income or loss;
(ii) Any
expenditures of the Company described in Section 705(a)(2)(B) of the Code,
and not otherwise taken into account in computing Profits or Losses pursuant to
this definition shall be subtracted from such taxable income or
loss;
(iii) If the
Gross Asset Value of any Company asset is adjusted pursuant to subparagraph
(ii) or (iv) of the definition of Gross Asset Value hereof, the amount
of such adjustment shall be taken into account as gain or loss from the
disposition of such asset for purposes of computing Profits or
Losses;
(iv) Gain or
loss resulting from any disposition of property (other than money) with respect
to which gain or loss is recognized for federal income tax purposes shall be
computed by reference to the Gross Asset Value of the property disposed of
notwithstanding that the adjusted tax basis of such property differs from its
Gross Asset Value;
(v) In lieu
of the depreciation, amortization and other cost recovery deductions taken into
account in computing such taxable income or loss, there shall be taken into
account Depreciation for such fiscal year or other period, computed in
accordance with the definition of Depreciation hereof; and
(vi) Notwithstanding
any other provision of this definition of “Profits and Losses,” any items that
are specially allocated pursuant to Section 6.03(d) hereof shall not be
taken into account in computing Profits or Losses.
“Sharing Ratio” means, subject
in each case to adjustments in accordance with this Agreement or in connection
with Dispositions of Membership Interests, (a) in the case of a Member
executing this Agreement as of the date of this Agreement or a Person acquiring
such Member’s Membership Interest, the percentage specified for that Member as
its Sharing Ratio on Exhibit A, and (b) in the case of Membership
Interests issued pursuant to Section 3.01, the Sharing Ratio established
pursuant thereto; provided, however, that the total of
all Sharing Ratios shall always equal 100%.
7
“Special Approval” means
approval by a majority of the members of the Conflicts Committee.
“Subsidiary” means, with
respect to any Person, (a) a corporation of which more than 50% of the
voting power of shares entitled (without regard to the occurrence of any
contingency) to vote in the election of directors or other governing body of
such corporation is owned, directly or indirectly, at the date of determination,
by such Person, by one or more Subsidiaries of such Person or a combination
thereof, (b) a partnership (whether general or limited) in which such
Person or a Subsidiary of such Person is, at the date of determination, a
general or limited partner of such partnership, but only if more than 50% of the
partnership interests of such partnership (considering all of the partnership
interests of the partnership as a single class) is owned, directly or
indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such Person or a combination thereof, or (c) any other
Person (other than a corporation or a partnership) in which such Person, one or
more Subsidiaries of such Person or a combination thereof, directly or
indirectly, at the date of determination, has (i) at least a majority
ownership interest or (ii) the power to elect or direct the election of a
majority of the directors or other governing body of such Person.
“Target Capital Account
Amount” means, with respect to a Member, the distribution the Member
would receive pursuant to Section 6.02 if the amount to be distributed to
the Member equaled the product of (i) the amount described in
Section 12.02(a)(iii)(C) multiplied by (ii) the Member’s Sharing
Ratio.
“Tax Matters Member” has the
meaning given such term in Section 10.03.
“Treasury Regulations” means
the regulations (including temporary regulations) promulgated by the United
States Department of the Treasury pursuant to and in respect of provisions of
the Code. All references herein to sections of the Treasury Regulations shall
include any corresponding provision or provisions of succeeding, similar or
substitute, temporary or final Treasury Regulations.
“Unit” means a unit
representing the Membership Interest of a Member.
“Withdraw,” “Withdrawing” or “Withdrawal” means the
withdrawal, resignation or retirement of a Member from the Company as a Member.
Such terms shall not include any Dispositions of Membership Interest (which are
governed by Article IV), even though the Member making a Disposition may
cease to be a Member as a result of such Disposition.
(b) Other
terms defined herein have the meanings so given them.
SECTION 1.02 Construction.
Unless
the context requires otherwise: (a) any pronoun used in this Agreement
shall include the corresponding masculine, feminine or neuter forms, and the
singular form of nouns, pronouns and verbs shall include the plural and vice
versa; (b) references to Articles and Sections refer to Articles and
Sections of this Agreement; (c) the terms “include”, “includes”,
“including” or words of like import shall be deemed to be followed by the words
“without limitation”; and (d) the terms “hereof”, “herein” or “hereunder”
refer to this Agreement as a whole and not to any particular provision of this
Agreement. The table of contents and headings contained in this Agreement are
for reference purposes only, and shall not affect in any way the meaning or
interpretation of this Agreement.
8
ORGANIZATION
SECTION
2.01 Formation.
The
Company was formed as a Delaware limited liability company by the filing of a
Certificate of Formation (the “Delaware Certificate”) on
February 22, 2007 with the Secretary of State of the State of Delaware under and
pursuant to the Act.
SECTION 2.02 Name.
The name
of the Company is “Blueknight Energy Partners G.P., L.L.C.” and all Company
business must be conducted in that name and such other names that comply with
Applicable Law as the Board or the Member may select.
SECTION
2.03 Registered Office;
Registered Agent; Principal Office.
The name
of the Company’s registered agent for service of process is The Corporation
Trust Company, and the address of the Company’s registered office in the State
of Delaware is The Corporation Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000. The principal place of business of the Company shall be located
at Two Xxxxxx Place, 0000 Xxxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxx, Xxxxxxxx 00000.
The Members may change the Company’s registered agent or the location of the
Company’s registered office or principal place of business as the Members may
from time to time determine.
SECTION
2.04 Purposes.
The
purpose of the Company is to act as the general partner of the Partnership as
described in the Partnership Agreement and to engage in any lawful business or
activity ancillary or related thereto. The Company shall possess and
may exercise all the powers and privileges granted by the Act, by any other law
or by this Agreement, together with any powers incidental thereto, including
such powers and privileges as are necessary or appropriate to the conduct,
promotion or attainment of the business, purposes or activities of the
Company.
SECTION 2.05 Term.
The
period of existence of the Company commenced on February 22, 2007 and shall end
at such time as a certificate of cancellation is filed with the Secretary of
State of Delaware in accordance with Section 12.04.
SECTION 2.06 No State Law
Partnership.
The
Members intend that the Company shall not be a partnership (whether general,
limited or other) or joint venture, and that no Member shall be a partner or
joint venturer with any other Member, for any purposes other than (if the
Company has more than one Member) federal and state income tax purposes, and
this Agreement may not be construed or interpreted to the contrary.
9
SECTION 2.07 Certain Undertakings
Relating to the Separateness.
(a) Separateness Generally. The
Company shall, and shall cause the members of the Partnership Group to, conduct
their respective businesses and operations separate and apart from those of any
other Person (including the Controlling Entities), except the Company and/or one
or more members of the Partnership Group, in accordance with this Section
2.07.
(b) Separate Records. The Company
shall, and shall cause the Partnership to, (i) maintain their respective
books and records and their respective accounts separate from those of any other
Person, (ii) maintain their respective financial records, which will be
used by them in their ordinary course of business, showing their respective
assets and liabilities separate and apart from those of any other Person, except
their consolidated Subsidiaries, and (iii) file their respective own tax
returns separate from those of any other Person, except (A) to the extent
that the Partnership or the Company (x) is treated as a “disregarded
entity” for tax purposes or (y) is not otherwise required to file tax
returns under applicable law or (B) as may otherwise be required by
applicable law.
(c) Separate Assets. The Company
shall not, and shall cause the Partnership to not, commingle or pool its funds
or other assets with those of any other Person, except its consolidated
Subsidiaries, and shall maintain its assets in a manner in which it is not
costly or difficult to segregate, ascertain or otherwise identify its assets as
separate from those of any other Person.
(d) Separate Name. The Company
shall, and shall cause the members of the Partnership Group to, (i) conduct
their respective businesses in their respective own names or in the names of
their respective Subsidiaries or the Partnership, (ii) use their or the
Partnership’s separate stationery, invoices, and checks, (iii) correct any
known misunderstanding regarding their respective separate identities as members
of the Partnership Group from that of any other Person (including the
Controlling Entities), and (iv) generally hold themselves and the
Partnership Group out as entities separate from any other Person (including the
Controlling Entities).
(e) Separate Credit. The Company
shall, and shall cause the members of the Partnership Group to, (i) pay
their respective obligations and liabilities from their respective own funds
(whether on hand or borrowed), (ii) maintain adequate capital in light of
their respective business operations, (iii) not pledge their respective
assets for the benefit of any Person or guarantee or become obligated for the
debts of any other Person, other than the Company and/or one or more members of
the Partnership Group, (iv) not hold out their respective credit as being
available to satisfy the obligations or liabilities of any other Person, except
members of the Partnership Group, (v) not acquire debt obligations or debt
securities of the Controlling Entities, (vi) not make loans or advances to
any Person, except members of the Partnership Group, or (vii) use their
commercially reasonable efforts to cause the operative documents under which the
Company borrows money, is an issuer of debt securities, or guarantees any such
borrowing or issuance to contain provisions to the effect that (A) the
lenders or purchasers of debt securities, respectively, acknowledge that they
have advanced funds or purchased debt securities, respectively, in reliance upon
the separateness of the Company and the Partnership from each other and from any
other Persons, including the Controlling Entities, and (B) the Company and
the Partnership have assets and liabilities that are separate from those of
other Persons, including the Controlling Entities; provided that the Company and
the Partnership may engage in any transaction described in clauses (v)-(vi) of
this Section 2.07(e) if prior Special Approval has been obtained for such
transaction and either (A) the Conflicts Committee has determined by
Special Approval that the borrower or recipient of the credit support is not
then insolvent and will not be rendered insolvent as a result of such
transaction or (B) in the case of transactions described in clause (v),
such transaction is completed through a public auction or a National Securities
Exchange (as such term is defined in the Partnership Agreement).
10
(f) Separate Formalities. The
Company shall, and shall cause the Partnership to, (i) observe all limited
liability company or limited partnership formalities, as the case may be, and
other formalities required by its organizational documents, the laws of the
jurisdiction of its formation and other Applicable Laws, (ii) engage in
transactions with any member of the Controlling Entities in conformity with the
requirements of Section 7.9(c) of the Partnership Agreement and
(iii) subject to the terms of the Omnibus Agreement, promptly pay, from its
own funds, and on a current basis, its allocable share of general and
administrative expenses, capital expenditures, and costs for shared services
performed by any member of the Controlling Entities. Each material contract
between the Company or the Partnership, on the one hand, and any member of the
Controlling Entities, on the other hand, shall be in writing.
(g) No Effect. Failure
by the company to comply with any of the obligations set forth above shall not
affect the status of the Company as a separate legal entity, with its separate
assets and separate liabilities or restrict or limit the Company from engaging
or contracting with the Controlling Entities for the provision of services or
the purchase or sale of products, whether under the Omnibus Agreement or
otherwise.
MEMBERSHIP
SECTION 3.01 Membership Interests;
Additional Members.
BKEP
Holdings is the sole initial Member of the Company as reflected in
Exhibit A attached hereto. Persons may be admitted to the Company as
Members, on such terms and conditions as the Members determine at the time of
admission. The terms of admission or issuance must specify the Sharing Ratios
applicable thereto and may provide for the creation of different classes or
groups of Members having different rights, powers and duties. The Members may
reflect the creation of any new class or group in an amendment to this
Agreement, indicating the different rights, powers and duties, and such an
amendment shall be approved and executed by the Members. Any such admission
shall be effective only after such new Member has executed and delivered to the
Members and the Company an instrument containing the notice address of the new
Member, the new Member’s ratification of this Agreement and agreement to be
bound by it. Membership Interests in the Company shall be represented
by Units with each Unit representing one percent of the Sharing Ratios. Upon the
Company’s issuance of Units to any Person, the Company shall issue, upon the
request of such Person, one or more Certificates in the name of such Person
evidencing the number of such Units being so issued. The Company hereby
irrevocably elects that all Units shall be securities governed by Article 8 of
the Uniform Commercial Code as in effect in the State of Delaware.
SECTION 3.02 Access to
Information.
Each
Member shall be entitled to receive any information that it may request
concerning the Company; provided, however, that this Section
3.02 shall not obligate the Company to create any information that does not
already exist at the time of such request (other than to convert existing
information from one medium to another, such as providing a printout of
information that is stored in a computer database). Each Member shall also have
the right, upon reasonable notice, and at all reasonable times during usual
business hours to inspect the properties of the Company and to audit, examine
and make copies of the books of account and other records of the Company. Such
right may be exercised through any agent or employee of such Member designated
in writing by it or by an independent public accountant, engineer, attorney or
other consultant so designated. All costs and expenses incurred in any
inspection, examination or audit made on such Member’s behalf shall be borne by
such Member.
11
SECTION 3.03 Liability.
(a) No Member
shall be liable for the debts, obligations or liabilities of the Company solely
by reason of being a member of the Company.
(b) The
Company and the Members agree that the rights, duties and obligations of the
Members in their capacities as members of the Company are only as set forth in
this Agreement and as otherwise arise under the Act. Furthermore, the Members
agree that the existence of any rights of a Member, or the exercise or
forbearance from exercise of any such rights, shall not create any duties or
obligations of the Member in its capacity as a member of the Company, nor shall
such rights be construed to enlarge or otherwise to alter in any manner the
duties and obligations of such Member.
SECTION 3.04 Withdrawal.
A Member
does not have the right or power to Withdraw.
SECTION 3.05 Meetings.
A meeting
of the Members may be called at any time at the request of any
Member.
SECTION 3.06 Notice.
Written
notice of all meetings of the Members must be given to all Members one Business
Day prior to any meeting of Members. All notices and other communications to be
given to Members shall be sufficiently given for all purposes hereunder
(i) if in writing and delivered by hand, courier or overnight delivery
service, then upon receipt, (ii) if mailed by certified or registered mail,
return receipt requested, with appropriate postage prepaid, then three days
after the date of mailing, or (iii) if sent by e-mail, telegram or
facsimile, then when received. All such notices and communications shall be
directed to the address, e-mail address or facsimile number of each Member as
such Member shall designate by notice to the Company. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the Members
need be specified in the notice of such meeting, except for amendments to this
Agreement, as provided herein. A meeting may be held at any time without notice
if all the Members are present or if those not present waive notice of the
meeting either before or after such meeting.
SECTION
3.07 Action by Consent of
Members.
Except as
otherwise required by Applicable Law, all decisions of the Members shall require
the affirmative vote of the Members owning a majority of Sharing Ratios present
at a meeting at which a quorum is present in accordance with Section 3.09.
To the extent permitted by Applicable Law, the Members may act without a meeting
and without notice so long as the number of Members who would be required to
take such action at a duly held meeting shall have executed a written consent
with respect to any such action taken in lieu of a meeting.
12
SECTION 3.08 Conference Telephone
Meetings.
Any
Member may participate in a meeting of the Members or by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and such participation in a
meeting shall constitute presence in person at such meeting.
SECTION 3.09 Quorum.
The
Members owning a majority of Sharing Ratios, present in person or participating
in accordance with Section 3.08, shall constitute a quorum for the
transaction of business, but, if at any meeting of the Members there shall be
less than a quorum present, a majority of the Members present may adjourn the
meeting from time to time without further notice. Any act of the Members owning
a majority of Sharing Ratios present at a meeting at which a quorum is present
shall be the act of the Members. The Members present at a duly organized meeting
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough Members to leave less than a quorum.
ADMISSION
OF MEMBERS; DISPOSITION OF MEMBERSHIP INTERESTS
SECTION
4.01 General
Restriction.
A Member
may not Dispose of all or any portion of its Membership Interests except in
strict accordance with this Article IV. References in this Article IV
to Dispositions of a Membership Interest shall also refer to Dispositions of a
portion of a Membership Interest. Any attempted Disposition of a Membership
Interest, other than in strict accordance with this Article IV, shall be,
and is hereby declared, null and void ab initio. The Members agree that a breach
of the provisions of this Article IV may cause irreparable injury to the
Company and to the other Members for which monetary damages (or other remedies
at law) are inadequate in view of (a) the complexities and uncertainties in
measuring the actual damages that would be sustained by reason of the failure of
a Member to comply with such provision and (b) the uniqueness of the
business of the Company and the relationship among the Members. Accordingly, the
Members agree that the provisions of this Article IV may be enforced by
specific performance.
SECTION 4.02 Admission of Assignee as a
Member.
An
Assignee has the right to be admitted to the Company as a Member, with the
Membership Interests (and attendant Sharing Ratio) so transferred to such
Assignee, only if (a) the Member making the Disposition (a “Disposing Member”) has
granted the Assignee either (i) all, but not less than all, of such
Disposing Member’s Membership Interests or (ii) the express right to be so
admitted and (b) such Disposition is effected in strict compliance with
this Article IV.
SECTION 4.03 Requirements Applicable to
All Dispositions and Admissions.
Any
Disposition of Membership Interests and any admission of an Assignee as a Member
shall also be subject to the following requirements, and such Disposition (and
admission, if applicable) shall not be effective unless such requirements are
complied with:
13
(a) Payment of Expenses. The
Disposing Member and its Assignee shall pay, or reimburse the Company for, all
reasonable costs and expenses incurred by the Company in connection with the
Disposition and admission of the Assignee as a Member.
(b) No Release. No Disposition of
Membership Interests shall effect a release of the Disposing Member from any
liabilities to the Company or the other Members arising from events occurring
prior to the Disposition, except as otherwise may be provided in any instrument
or agreement pursuant to which a Disposition of Membership Interests is
effected.
CAPITAL
CONTRIBUTIONS
SECTION 5.01 Initial Capital
Contributions.
BKEP
Holdings, as the sole Member of the Company, has made the Capital Contribution
as set forth next to the Member’s name on Exhibit A.
SECTION
5.02 Loans.
If the
Company does not have sufficient cash to pay its obligations, any Member(s) that
may agree to do so may advance all or part of the needed funds to or on behalf
of the Company. An advance described in this Section 5.02 constitutes a
loan from the Member to the Company, bears interest at a rate determined by the
Members from the date of the advance until the date of payment and is not a
Capital Contribution.
SECTION 5.03 Return of
Contributions.
Except as
expressly provided herein, no Member is entitled to the return of any part of
its Capital Contributions or to be paid interest in respect of either its
Capital Account or its Capital Contributions. A Capital Contribution remaining
unpaid by the Company is not a liability of the Company or of any Member. A
Member is not required to contribute or to lend any cash or property to the
Company to enable the Company to return any Member’s Capital
Contributions.
SECTION
5.04 Capital
Accounts.
An
individual Capital Account shall be established and maintained for each Member.
A Member that has more than one class or series of Membership Interest shall
have a single Capital Account that reflects all such classes or series of
Membership Interests, regardless of the classes or series of Membership
Interests owned by such Member and regardless of the time or manner in which
such Membership Interests were acquired. Upon the Disposition of all or a
portion of a Membership Interest, the Capital Account of the Disposing Member
that is attributable to such Membership Interest shall carry over to the
Assignee in accordance with the provisions of Treasury Regulation
Section 1.704-1(b)(2)(iv)(l).
14
DISTRIBUTIONS
AND ALLOCATIONS
SECTION 6.01 Distributions.
Except as
otherwise provided in Section 6.02, distributions to the Members shall be
made only to all Members simultaneously in proportion to their respective
Sharing Ratios (at the time the amounts of such distributions are determined)
and in such aggregate amounts and at such times as shall be determined by the
Members representing a Majority Interest (at the time the amounts of such
distributions are determined);
provided,
however, that any loans from Members pursuant to Section 5.02 shall
be repaid prior to any distributions to Members pursuant to this
Section 6.01.
SECTION 6.02 Distributions on Dissolution
and Winding Up.
Upon the
dissolution and winding up of the Company, after adjusting the Capital Accounts,
if any, for all distributions made under Section 6.01 and all allocations
under Article VI, all available proceeds distributable to the Members as
determined under Section 12.02 shall be distributed (i) to all of the
Members in amounts equal to the Members’ positive Capital Account balances, or
(ii) if the obligation to maintain Capital Accounts has been suspended
under Section 13.11 of this Agreement, to the sole Member.
SECTION
6.03 Allocations.
Subject
to the allocation rules of Section 6.03(c), (d) and (e) hereof,
Profits and Losses of the Company for any fiscal year shall be allocated as
follows:
(a) Profits
for any fiscal year shall be allocated in the following order of
priority:
(i) First, to
all Members, in proportion to the deficit balances (if any) in their Capital
Accounts, in an amount necessary to eliminate any deficits in the Members’
Capital Accounts and restore such Capital Accounts balances to
zero;
(ii) Next, to
the Members, to the greatest extent possible, an amount required to cause the
positive Capital Account balances of each of the Members to be in the same
proportion as the Member’s respective Sharing Ratios; and
(iii) Thereafter,
to the Members in proportion to their respective Sharing Ratios.
(b) Losses
for any fiscal year shall be allocated in the following order of
priority:
(i) First, to
the Members, to the greatest extent possible, an amount required to cause the
positive Capital Account balances of each of the Members to be in the same
proportion as the Member’s respective Sharing Ratios;
15
(ii) Next, to
the Members in proportion to their respective Sharing Ratios until the Capital
Account balances of such Members have been reduced to zero; and
(iii) Thereafter,
to the Members in proportion to their respective Sharing Ratios.
(c) In the
event of the dissolution of the Company pursuant to Section 12.01 hereof,
if the allocation of Profits or Losses to a Member pursuant to
Sections 6.03(a) and (b) would cause a Member to have a Capital
Account balance in an amount that is greater than or less than the Member’s
Target Capital Account Amount, then the allocations of Profits and Losses shall
be adjusted, to the greatest extent possible, to cause the positive Capital
Account balances of each Member to equal such Member’s Target Capital Account
Balance.
(d) The
following special allocations shall be made in the following order:
(i) Qualified Income Offset. In
the event any Member unexpectedly receives any adjustments, allocations, or
distributions described in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4),
1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of Company income and
gain shall be specially allocated to each such Member in an amount and manner
sufficient to restore, to the extent required by the Treasury Regulations, the
Member’s Adjusted Capital Account Deficit of such Member as quickly as possible,
provided that an allocation pursuant to this Section 6.03(d)(i) shall be
made only if and to the extent that such Member would have an Adjusted Capital
Account Deficit after all other allocations provided for in this Article VI
have been tentatively made as if this Section 6.03(d)(i) was not in this
Agreement.
(ii) Gross Income Allocation. In
the event any Member has a deficit Capital Account at the end of any Company
fiscal year which is in excess of the sum of (x) the amount such Member is
obligated to restore pursuant to any provision of this Agreement and
(y) the amount such Member is deemed to be obligated to restore pursuant to
the penultimate sentence of Treasury Regulation Sections 1.704-2(g)(1) and
1.704-2(i)(5), each such Member shall be specially allocated items of Company
income and gain in the amount of such excess as quickly as possible, provided
that an allocation pursuant to this Section 6.03(d)(ii) shall be made only
if and to the extent that such Member would have a deficit Capital Account
balance in excess of such sum after all other allocations provided for in this
Article VI have been made as if Section 6.03(d)(i) hereof and this
Section 6.03(d)(ii) were not in this Agreement.
(iii) Section 754 Adjustments.
To the extent an adjustment of the adjusted tax basis of any Company asset
pursuant to Section 734(b) of the Code or Section 743(b) of the Code is
required, pursuant to Treasury
Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in
determining Capital Accounts, the amount of such adjustment to the Capital
Accounts shall be treated as an item of gain (if the adjustment increases the
basis of the asset) or loss (if the adjustment decreases such basis) and such
gain or loss shall be specially allocated to the Members in a manner consistent
with the manner in which their Capital Accounts are required to be adjusted
pursuant to such section of the Treasury Regulations.
16
(e) In
accordance with Section 704(c) of the Code and the Treasury Regulations
thereunder, income, gain, loss, and deduction with respect to any property
contributed to the capital of the Company shall, solely for tax purposes, be
allocated among the Members to take account of any variation between the
adjusted basis of such property to the Company for federal income tax purposes
and its initial Gross Asset Value (computed in accordance with the definition of
same under this Agreement). In the event the Gross Asset Value of any Company
asset is adjusted pursuant to subparagraph (ii) of the definition of Gross
Asset Value hereof, subsequent allocations of income, gain, loss, and deduction
with respect to such asset shall take account of any variation between the
adjusted basis of such asset for federal income tax purposes and its Gross Asset
Value in the same manner as under Section 704(c) of the Code and the Treasury
Regulations thereunder. Any elections or other decisions relating to such
allocations shall be made by the Board in any manner that reasonably reflects
the purpose and intention of this Agreement, provided that the Company shall use
the remedial allocation method set forth in Treasury
Regulation Section 1.704-3(d). Allocations pursuant to this Section
6.03(e) are solely for purposes of federal, state, and local taxes and shall not
affect, or in any way be taken into account in computing, any Member’s Capital
Account or share of Profits, Losses, other items, or distributions pursuant to
any provision of this Agreement.
SECTION 6.04 Varying
Interests.
All items
of income, gain, loss, deduction or credit shall be allocated, and all
distributions shall be made, to the Persons shown on the records of the Company
to have been Members as of the last calendar day of the period for which the
allocation or distribution is to be made. Notwithstanding the foregoing, if
during any taxable year there is a change in any Member’s Sharing Ratio, the
Members agree that their allocable shares of such items for the taxable year
shall be determined on any method determined by the Board to be permissible
under Code Section 706 and the related Treasury Regulations to take account
of the Members’ varying Sharing Ratios.
SECTION 6.05 Withheld
Taxes.
All
amounts withheld pursuant to the Code or any provision of any state or local tax
law with respect to any payment, distribution or allocation to the Company or
the Members shall be treated as amounts distributed to the Members pursuant to
this Article VI for all purposes of this Agreement. The Company is
authorized to withhold from distributions, or with respect to allocations, to
the Members and to pay over to any federal, state or local government any
amounts required to be so withheld pursuant to the Code or any provision of any
other federal, state or local law and shall allocate such amounts to those
Members with respect to which such amounts were withheld.
SECTION 6.06 Limitations on
Distributions.
Notwithstanding
any provision to the contrary contained in this Agreement, the Company shall not
make a distribution to any Member on account of its interest in the Company if
such distribution would violate Section 18-607 of the Act or other
Applicable Law.
17
MANAGEMENT
SECTION
7.01 Management by Board of
Directors.
(a) The
management of the Company is fully reserved to the Members, and the Company
shall not have “managers” as that term is used in the Act. The powers of the
Company shall be exercised by or under the authority of, and the business and
affairs of the Company shall be managed under the direction of, the Members, who
shall make all decisions and take all actions for the Company.
(b) The
Members shall have the power and authority to delegate to one or more other
persons the Members’ rights and power to manage and control the business and
affairs, or any portion thereof, of the Company, including to delegate to
agents, officers and employees of a Member or the Company, and to delegate by a
management agreement with or otherwise to other Persons.
(c) The
Members have heretofore delegated, and hereby expressly continue to delegate to
the Board of Directors of the Company (the “Board”), to the fullest
extent permitted under this Agreement and Delaware law, all of the Company’s
power and authority to manage and control the business and affairs of the
Partnership. The number of directors constituting the Board shall be fixed from
time to time pursuant to a resolution adopted by Members representing a Majority
Interest. The Directors of the Company in office at the date of approval of this
Agreement are set forth on Exhibit B hereto. The Board may designate one or
more other persons to be officers of the Company to assist in carrying out the
Board’s decisions and the day-to-day activities of the Company in its role as
the general partner of the Partnership. Officers are not “managers” as that term
is used in the Act. Any officers who are so designated shall have such titles
and authority and perform such duties as the Board may delegate to them. The
salaries or other compensation, if any, of the officers of the Company shall be
fixed by the Board. Any officer may be removed as such, either with or without
cause, by the Board and any vacancy occurring in any office of the Company may
be filled by the Board. Designation of an officer shall not of itself create
contract rights.
SECTION 7.02 Number; Qualification;
Tenure.
(a) The
number of Directors constituting the Board shall be at least two and no more
than nine, and may fixed from time to time pursuant to a resolution adopted by a
majority of the Directors. A Director need not be a Member. Each Director shall
be elected or approved by the Members at an annual meeting of the Members and
shall serve as a Director of the Company for a term of one year (or their
earlier death or removal from office) or until their successors are elected and
qualified.
(b) The
Directors of the Company in office at the date of approval of this Agreement are
set forth on Exhibit B hereto. The Members shall appoint one additional
Independent Director within three months of the listing of the Common Units (as
such term is defined in the Partnership Agreement) on the Nasdaq Stock Market or
any National Securities Exchange on which the Common Units are listed and one
additional Independent Director within 12 months of such listing or within
such other time period as may be required by the Nasdaq Stock Market or the
Commission.
18
SECTION 7.03 Regular
Meetings.
Regular
quarterly and annual meetings of the Board shall be held at such time and place
as shall be designated from time to time by resolution of the Board. Notice of
such regular quarterly and annual meetings shall not be required.
SECTION 7.04 Special
Meetings.
A special
meeting of the Board may be called at any time at the request of (a) the
Chairman of the Board or (b) a majority of the Directors then in
office.
SECTION 7.05 Notice.
Written
notice of all special meetings of the Board must be given to all Directors at
least two Business Days prior to any special meeting of the Board. All notices
and other communications to be given to Directors shall be sufficiently given
for all purposes hereunder if in writing and delivered by hand, courier or
overnight delivery service or three Days after being mailed by certified or
registered mail, return receipt requested, with appropriate postage prepaid, or
when received in the form of an e-mail, telegram or facsimile, and shall be
directed to the address, e-mail address or facsimile number as such Director
shall designate by notice to the Company. Neither the business to be transacted
at, nor the purpose of, any regular or special meeting of the Board need be
specified in the notice of such meeting, except for amendments to this
Agreement, as provided herein. A meeting may be held at any time without notice
if all the Directors are present or if those not present waive notice of the
meeting either before or after such meeting.
SECTION 7.06 Action by Consent of
Board.
To the
extent permitted by Applicable Law, the Board, or any committee of the Board,
may act without a meeting so long as all members of the Board or committee shall
have executed a written consent with respect to any action taken in lieu of a
meeting.
SECTION 7.07 Conference Telephone
Meetings.
Directors
or members of any committee of the Board may participate in a meeting of the
Board or such committee by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at such meeting.
SECTION
7.08 Quorum.
A
majority of all Directors, present in person or participating in accordance with
Section 7.07, shall constitute a quorum for the transaction of business, but if
at any meeting of the Board there shall be less than a quorum present, a
majority of the Directors present may adjourn the meeting from time to time
without further notice. Except as otherwise required by Applicable Law, all
decisions of the Board, or any committee of the Board, shall require the
affirmative vote of a majority of all Directors of the Board, or any committee
of the Board, respectively. The Directors present at a duly organized meeting
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough Directors to leave less than a quorum.
19
SECTION 7.09 Vacancies; Increases in the
Number of Directors.
Vacancies
and newly created directorships resulting from any increase in the number of
Directors shall be filled by the Members in their sole discretion. Any Director
so chosen shall hold office until the next annual election and until his
successor shall be duly elected and shall qualify, unless sooner
displaced.
SECTION 7.10 Committees.
(a) The Board
may establish committees of the Board and may delegate any of its
responsibilities, except as otherwise prohibited by Applicable Law, to such
committees.
(b) The Board
shall have an audit committee (the “Audit Committee”) comprised
of directors who meet the independence standards required of directors who serve
on an audit committee of a board of directors established by the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Commission thereunder and by the Nasdaq Global Market or any National Securities
Exchange on which the Common Units are listed. The Audit Committee shall
establish a written audit committee charter in accordance with the rules and
regulations of the Nasdaq Global Market or any National Securities Exchange on
which the Common Units are listed from time to time, and the Commission, as
amended from time to time. Each member of the Audit Committee shall satisfy the
rules and regulations of the Nasdaq Global Market or any National Securities
Exchange on which the Common Units are listed from time to time and the
Commission, as amended from time to time, pertaining to qualification for
service on an audit committee. An “Independent Director” shall
mean a Director so satisfying such rules and regulations.
(c) The Board
shall have a conflicts committee comprised of no fewer than two Directors (the
“Conflicts Committee”);
all members of whom shall be Independent Directors, but none of whom may be (i)
security holders, officers or employees of the Company, (ii) officers, directors
or employees of any Affiliate of the Company or (iii) holders of any ownership
interest in the Partnership Group other than Common Units. The Conflicts
Committee may review, and approve or disapprove, transactions in which a
potential conflict of interest exists or arises between the Company, or any of
its Affiliates (other than a Group Member), on the one hand, and any Group
Member or any Partner (as defined in the Partnership Agreement), all in
accordance with the applicable provisions of the Partnership Agreement. Any
matter approved by the Conflicts Committee in good faith in accordance with the
provisions, and subject to the limitations, of the Partnership Agreement, shall
not be deemed to be a breach of any fiduciary or other duties owed by the Board
or any Director to the Company or the Members.
(d) The Board
may have a compensation committee (the “Compensation Committee”). The
Compensation Committee shall be charged with such matters pertaining to the
compensation of Directors, officers and other personnel of the Company, the
review, approval and administration of any Incentive Plans put in place by the
Company or the Partnership and such other related matters as may be directed by
the Board from time to time.
20
(e) A
majority of any committee, present in person or participating in accordance with
Section 7.07, shall constitute a quorum for the transaction of business of such
committee.
(f) A
majority of any committee may determine its action and fix the time and place of
its meetings unless the Board shall otherwise provide. Notice of such meetings
shall be given to each member of the committee in the manner provided for in
Section 7.05. The Board shall have power at any time to fill vacancies in,
to change the membership of, or to dissolve any such committee.
SECTION 7.11 Removal.
Any
Director or the entire Board may be removed at any time, with or without cause,
by the Members.
SECTION
7.12 Compensation of
Directors.
Except as
expressly provided in any written agreement between the Company and a Director
or by resolution of the Board pursuant, no Director shall receive any
compensation from the Company for services provided to the Company in its
capacity as a Director, except that each Director shall be compensated for
attendance at Board meetings at rates of compensation as from time to time
established by the Board or a committee thereof; provided, however, that Directors who
are also employees of the Company or any Affiliate thereof shall receive no
compensation for their services as Directors or committee members. In addition,
the Directors who are not employees of the Company or any Affiliate thereof
shall be entitled to be reimbursed for out-of-pocket costs and expenses incurred
in connection with attending meetings of the Board or committees
thereof.
OFFICERS
SECTION 8.01 Officers.
The
officers of the Company shall serve at the pleasure of the Board. Such officers
shall have the authority and duties delegated to each of them, respectively, by
the Board from time to time. The officers of the Company shall be a Chairman of
the Board, a Chief Executive Officer, a President, a Secretary, a Treasurer, and
such other officers (including, without limitation, Executive Vice Presidents,
Senior Vice Presidents and Vice Presidents) as the Board from time to time may
deem proper. The Chairman of the Board shall be chosen from among the Directors.
All officers elected by the Board shall each have such powers and duties as
generally pertain to their respective offices, subject to the specific
provisions of this Article VIII. The Board or any committee thereof may
from time to time elect such other officers (including one or more Vice
Presidents, General Counsels, Controllers, Assistant Secretaries and Assistant
Treasurers) as may be necessary or desirable for the conduct of the business of
the Company. Such other officers and agents shall have such duties and shall
hold their offices for such terms as shall be provided in this Agreement or as
may be prescribed by the Board or such committee, as the case may be from time
to time.
21
SECTION
8.02 Election and Term of
Office.
The names
and titles of the officers of the Company in office as of the date of approval
of this Agreement are set forth on Exhibit C hereto. Thereafter, the
officers of the Company shall be elected from time to time by the
Board. Each officer shall hold office until such person’s successor
shall have been duly elected and shall have qualified or until such person’s
death or until he shall resign or be removed pursuant to
Section 8.09.
SECTION 8.03 Chairman of the
Board.
The
Chairman of the Board, if any, shall preside, if present, at all meetings of the
Board and of the unitholders of the Partnership and shall perform such
additional functions and duties as the Board may prescribe from time to
time. The Directors also may elect a Vice Chairman of the Board to
act in the place of the Chairman of the Board upon his or her absence or
inability to act.
SECTION
8.04 Chief Executive
Officer.
The Chief
Executive Officer, who may be the Chairman or Vice Chairman of the Board and/or
the President, shall have general and active management of the business of the
Company and shall see that all orders and resolutions of the Board are carried
into effect. The Chief Executive Officer may sign deeds, mortgages, bonds,
contracts or other instruments, except in cases where the signing and execution
thereof shall be expressly delegated by the Board or by this Agreement to some
other officer or agent of the Company, or shall be required by law to be
otherwise signed and executed. The Chief Executive Officer shall also perform
all duties and have all powers incident to the office of Chief Executive Officer
and perform such other duties and may exercise such other powers as may be
assigned by this Agreement or prescribed by the Board from time to
time.
SECTION 8.05 President.
The
President shall, subject to the control of the Board and the Chief Executive
Officer, in general, supervise and control all of the business and affairs of
the Company. The President shall preside at all meetings of the Members. The
President may sign any deeds, mortgages, bonds, contracts or other instruments,
except in cases where the signing and execution thereof shall be expressly
delegated by the Board or by this Agreement to some other officer or agent of
the Company, or shall be required by law to be otherwise signed and executed.
The President shall also perform all duties and have all powers incident to the
office of President and perform such other duties as may be prescribed by the
Board from time to time.
SECTION
8.06 Vice
Presidents.
Any
Executive Vice President, Senior Vice President and Vice President, in the order
of seniority, unless otherwise determined by the Board, shall, in the absence or
disability of the President, perform the duties and exercise the powers of the
President. They shall also perform the usual and customary duties and have the
powers that pertain to such office and generally assist the President by
executing contracts and agreements and exercising such other powers and
performing such other duties as are delegated to them by the President and as
the Board may further prescribe.
22
SECTION 8.07 Treasurer.
(a) The
Treasurer shall exercise general supervision over the receipt, custody and
disbursement of corporate funds. The Treasurer shall cause the funds of the
Company to be deposited in such banks as may be authorized by the Board, or in
such banks as may be designated as depositories in the manner provided by
resolution of the Board. The Treasurer shall, in general, perform all duties
incident to the office of the Treasurer and shall have such further powers and
duties and shall be subject to such directions as may be granted or imposed from
time to time by the Board.
(b) Assistant
Treasurers shall have such authority and perform such duties of the Treasurer as
may be provided in this Agreement or assigned to them by the Board or the
Treasurer. Assistant Treasurers shall assist the Treasurer in the performance of
the duties assigned to the Treasurer, and in assisting the Treasurer, each
Assistant Treasurer shall for such purpose have the powers of the Treasurer.
During the Treasurer’s absence or inability, the Secretary’s authority and
duties shall be possessed by such Assistant Treasurer or Assistant Treasurers as
the Board may designate.
SECTION 8.08 Secretary.
(a) The
Secretary shall keep or cause to be kept, in one or more books provided for that
purpose, the minutes of all meetings of the Board, the committees of the Board
and the Members and of the Limited Partners pursuant to Article VII. The
Secretary shall see that all notices are duly given in accordance with the
provisions of this Agreement and as required by law; shall be custodian of the
records and the seal of the Company and affix and attest the seal to all
documents to be executed on behalf of the Company under its seal; and shall see
that the books, reports, statements, certificates and other documents and
records required by law to be kept and filed are properly kept and filed; and in
general, shall perform all the duties incident to the office of Secretary and
such other duties as from time to time may be assigned to the Secretary by the
Board.
(b) Assistant
Secretaries shall have such authority and perform such duties of the Secretary
as may be provided in this Agreement or assigned to them by the Board or the
Secretary. Assistant Secretaries shall assist the Secretary in the performance
of the duties assigned to the Secretary, and in assisting the Secretary, each
Assistant Secretary shall for such purpose have the powers of the Secretary.
During the Secretary’s absence or inability, the Secretary’s authority and
duties shall be possessed by such Assistant Secretary or Assistant Secretaries
as the Board may designate.
SECTION 8.09 Removal.
Any
officer elected, or agent appointed, by the Board may be removed by the
affirmative vote of a majority of the Board whenever, in their judgment, the
best interests of the Company would be served thereby. No officer shall have any
contractual rights against the Company for compensation by virtue of such
election beyond the date of the election of such person’s successor, such
person’s death, such person’s resignation or such person’s removal, whichever
event shall first occur, except as otherwise provided in an employment contract
or under an employee deferred compensation plan.
23
SECTION
8.11 Vacancies.
A newly
created elected office and a vacancy in any elected office because of death,
resignation or removal may be filled by the Board for the unexpired portion of
the term at any meeting of the Board.
INDEMNITY
AND LIMITATION OF LIABILITY
SECTION 9.01 Indemnification.
(a) To the
fullest extent permitted by law but subject to the limitations expressly
provided in this Agreement, all Indemnitees shall be indemnified and held
harmless by the Company from and against any and all losses, claims, damages,
liabilities, joint or several, expenses (including legal fees and expenses),
judgments, fines, penalties, interest, settlements or other amounts arising from
any and all claims, demands, actions, suits or proceedings, whether civil,
criminal, administrative or investigative, in which any Indemnitee may be
involved, or is threatened to be involved, as a party or otherwise, by reason of
its status as an Indemnitee; provided, however, that the Indemnitee
shall not be indemnified and held harmless if there has been a final and
non-appealable judgment entered by a court of competent jurisdiction determining
that, in respect of the matter for which the Indemnitee is seeking
indemnification pursuant to this Section 9.01, the Indemnitee acted in bad faith
or engaged in fraud, willful misconduct or, in the case of a criminal matter,
acted with knowledge that the Indemnitee’s conduct was unlawful. Any
indemnification pursuant to this Section 9.01 shall be made only out of the
assets of the Company, it being agreed that the Members shall not be personally
liable for such indemnification and shall have no obligation to contribute or
lend any monies or property to the Company to enable it to effectuate such
indemnification.
(b) To the
fullest extent permitted by law, expenses (including legal fees and expenses)
incurred by an Indemnitee who is indemnified pursuant to Section 9.01(a) in
defending any claim, demand, action, suit or proceeding shall, from time to
time, be advanced by the Company prior to a determination that the Indemnitee is
not entitled to be indemnified upon receipt by the Company of an undertaking by
or on behalf of the Indemnitee to repay such amount if it shall be determined
that the Indemnitee is not entitled to be indemnified as authorized in this
Section 9.01.
(c) The
indemnification provided by this Section 9.01 shall be in addition to any
other rights to which an Indemnitee may be entitled under any agreement, as a
matter of law or otherwise, both as to actions in the Indemnitee’s capacity as
an Indemnitee and as to actions in any other capacity (including any capacity
under the Underwriting Agreement (as such term is defined in the Partnership
Agreement)), and shall continue as to an Indemnitee who has ceased to serve in
such capacity and shall inure to the benefit of the heirs, successors, assigns
and administrators of the Indemnitee.
(d) The
Company may purchase and maintain insurance on behalf of the Indemnitees, the
Company and its Affiliates and such other Persons as the Company shall
determine, against any liability that may be asserted against or expense that
may be incurred by such Person in connection with the Company’s activities or
such Person’s activities on behalf of the Company, regardless of whether the
Company would have the power to indemnify such Person against such liability
under the provisions of this Agreement.
24
(e) For
purposes of this Section 9.01, the Company shall be deemed to have
requested an Indemnitee to serve as fiduciary of an employee benefit plan
whenever the performance by it of its duties to the Company also imposes duties
on, or otherwise involves services by, it to the plan or participants or
beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect
to an employee benefit plan pursuant to Applicable Law shall constitute “fines”
within the meaning of Section 9.01(a); and action taken or omitted by it
with respect to any employee benefit plan in the performance of its duties for a
purpose reasonably believed by it to be in the interest of the participants and
beneficiaries of the plan shall be deemed to be for a purpose that is in the
best interests of the Company.
(f) An
Indemnitee shall not be denied indemnification in whole or in part under this
Section 9.01 because the Indemnitee had an interest in the transaction with
respect to which the indemnification applies if the transaction was otherwise
permitted by the terms of this Agreement.
(g) The
provisions of this Section 9.01 are for the benefit of the Indemnitees,
their heirs, successors, assigns and administrators and shall not be deemed to
create any rights for the benefit of any other Persons.
(h) No
amendment, modification or repeal of this Section 9.01 or any provision
hereof shall in any manner terminate, reduce or impair the right of any past,
present or future Indemnitee to be indemnified by the Company, nor the
obligations of the Company to indemnify any such Indemnitee under and in
accordance with the provisions of this Section 9.01 as in effect
immediately prior to such amendment, modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to such amendment, modification or repeal, regardless of when such claims may
arise or be asserted.
(i) THE
PROVISIONS OF THE INDEMNIFICATION PROVIDED IN THIS SECTION 9.01 ARE INTENDED BY
THE PARTIES TO APPLY EVEN IF SUCH PROVISIONS HAVE THE EFFECT OF EXCULPATING THE
INDEMNITEE FROM LEGAL RESPONSIBILITY FOR THE CONSEQUENCES OF SUCH PERSON’S
NEGLIGENCE, FAULT OR OTHER CONDUCT.
SECTION
9.02 Liability of
Indemnitees.
(a) Notwithstanding
anything to the contrary set forth in this Agreement, no Indemnitee shall be
liable for monetary damages to the Company, the Partnership, the Members or any
other Persons who have acquired membership interests in the Company, for losses
sustained or liabilities incurred as a result of any act or omission of an
Indemnitee unless there has been a final and non-appealable judgment entered by
a court of competent jurisdiction determining that, in respect of the matter in
question, the Indemnitee acted in bad faith or engaged in fraud, willful
misconduct or, in the case of a criminal matter, acted with knowledge that the
Indemnitee’s conduct was criminal.
(b) To the
extent that, at law or in equity, an Indemnitee has duties (including fiduciary
duties) and liabilities relating thereto to the Company, such Indemnitee acting
in connection with the Company’s business or affairs shall not be liable to the
Company or to any Member for its good faith reliance on the provisions of this
Agreement.
25
(c) Any
amendment, modification or repeal of this Section 9.02 or any provision
hereof shall be prospective only and shall not in any way affect the limitations
on the liability of the Indemnitees under this Section 9.02 as in effect
immediately prior to such amendment, modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to such amendment, modification or repeal, regardless of when such claims may
arise or be asserted.
TAXES
SECTION 10.01 Tax
Returns.
The Board
shall cause to be prepared and timely filed (on behalf of the Company) all
federal, state and local tax returns required to be filed by the Company,
including making all elections on such tax returns. Each Member shall furnish to
the Company all pertinent information in its possession relating to the
Company’s operations that is necessary to enable the Company’s tax returns to be
timely prepared and filed. The Company shall bear the costs of the preparation
and filing of its returns.
SECTION 10.02 Tax
Matters.
For so
long as there is only one member of the Company, the Company shall be
disregarded as an entity separate from its owner for federal income tax
purposes. If at any time there is more than one Member of the
Company, the Members shall take such action as is necessary to cause the Company
to be classified as a partnership for federal income tax purposes.
SECTION 10.03 Tax Matters
Member.
BKEP
Holdings shall act as the “tax matters partner” of the Company pursuant to
Section 6231(a)(7) of the Code (the “Tax Matters Member”). The Tax
Matters Member shall take such action as may be necessary to cause to the extent
possible each Member to become a “notice partner” within the meaning of Section
6223 of the Code. The Tax Matters Member shall inform each Member of all
significant matters that may come to its attention in its capacity as Tax
Matters Member by giving notice thereof on or before the fifth Business Day
after becoming aware thereof and, within that time, shall forward to each Member
copies of all significant written communications it may receive in that
capacity.
BOOKS,
RECORDS, REPORTS, AND BANK ACCOUNTS
SECTION 11.01 Maintenance of
Books.
(a) The Board
shall keep or cause to be kept at the principal office of the Company or at such
other location approved by the Board complete and accurate books and records of
the Company, supporting documentation of the transactions with respect to the
conduct of the Company’s business and minutes of the proceedings of the Board
and any other books and records that are required to be maintained by Applicable
Law.
26
(b) The books
of account of the Company shall be maintained on the basis of a fiscal year that
is the calendar year and on an accrual basis in accordance with GAAP,
consistently applied.
SECTION 11.02 Reports.
The Board
shall cause to be prepared and delivered to each Member such reports, forecasts,
studies, budgets and other information as the Members may reasonably request
from time to time.
SECTION 11.03 Bank
Accounts.
Funds of
the Company shall be deposited in such banks or other depositories as shall be
designated from time to time by the Board. All withdrawals from any such
depository shall be made only as authorized by the Board and shall be made only
by check, wire transfer, debit memorandum or other written
instruction.
DISSOLUTION,
WINDING-UP, TERMINATION AND CONVERSION
SECTION
12.01 Dissolution.
(a) The
Company shall dissolve and its affairs shall be wound up on the first to occur
of the following events (each a “Dissolution
Event”):
(i) the
unanimous consent of the Members; or
(ii) entry of
a decree of judicial dissolution of the Company under Section 18-802 of the
Act; or
(iii) at any
time there are no Members of the Company, unless the Company is continued in
accordance with the Act or this Agreement.
(b) No other
event shall cause a dissolution of the Company.
(c) Upon the
occurrence of any event that causes there to be no Members of the Company, to
the fullest extent permitted by law, the personal representative of the last
remaining Member is hereby authorized to, and shall, within 90 days after
the occurrence of the event that terminated the continued membership of such
Member in the Company, agree in writing (i) to continue the Company and
(ii) to the admission of the personal representative or its nominee or
designee, as the case may be, as a substitute Member of the Company, effective
as of the occurrence of the event that terminated the continued membership of
such Member in the Company.
(d) Notwithstanding
any other provision of this Agreement, the Bankruptcy of a Member shall not
cause such Member to cease to be a member of the Company and, upon the
occurrence of such an event, the Company shall continue without
dissolution.
27
SECTION 12.02 Winding-Up and
Termination.
(a) On the
occurrence of a Dissolution Event, the Members shall act as liquidator. The
liquidator shall proceed diligently to wind up the affairs of the Company and
make final distributions as provided herein and in the Act. The costs of winding
up shall be borne as a Company expense. The steps to be accomplished by the
liquidator are as follows:
(i) as
promptly as possible after dissolution and again after final winding up, the
liquidator shall cause a proper accounting to be made by a recognized firm of
certified public accountants of the Company’s assets, liabilities, and
operations through the last Day of the month in which the dissolution occurs or
the final winding up is completed, as applicable;
(ii) the
liquidator shall discharge from Company funds all of the debts, liabilities and
obligations of the Company (including all expenses incurred in winding up or
otherwise make adequate provision for payment and discharge thereof (including
the establishment of a cash escrow fund for contingent, conditional and
unmatured liabilities in such amount and for such term as the liquidator may
reasonably determine); and
(iii) all
remaining assets of the Company shall be distributed to the Members as
follows:
A. the
liquidator may sell any or all Company property, including to Members, and any
resulting gain or loss from each sale shall be computed and allocated to the
Capital Accounts of the Members in accordance with the provisions of
Article VI;
B. with
respect to all Company property that has not been sold, the fair market value of
that property shall be determined and the Capital Accounts of the Members shall
be adjusted to reflect the manner in which the unrealized income, gain, loss,
and deduction inherent in property that has not been reflected in the Capital
Accounts previously would be allocated among the Members if there were a taxable
disposition of that property for the fair market value of that property on the
date of distribution; and
C. Company
property (including cash) shall be distributed among the Members in accordance
with Section 6.02; and, to the extent practicable, those distributions
shall be made by the end of the taxable year of the Company during which the
liquidation of the Company occurs (or, if later, 90 Days after the date of the
liquidation);
provided, however, that
notwithstanding the foregoing provisions of clauses (A), (B) and (C)
immediately above, if the obligation to maintain Capital Accounts has been
suspended under Section 13.11 of this Agreement, no allocations shall be made
and all Company property shall be distributed to the sole Member.
(b) The
distribution of cash or property to a Member in accordance with the provisions
of this Section 12.02 constitutes a complete return to the Member of its
Capital Contributions and a complete distribution to the Member of its
Membership Interest and all the Company’s property and constitutes a compromise
to which all Members have consented pursuant to Section 18-502(b) of the
Act. To the extent that a Member returns funds to the Company, it has no claim
against any other Member for those funds.
28
SECTION 12.03 Deficit Capital
Accounts.
No Member
will be required to pay to the Company, to any other Member or to any third
party any deficit balance that may exist from time to time in the Member’s
Capital Account.
SECTION
12.04 Certificate of
Cancellation.
On
completion of the distribution of Company assets as provided herein, the Members
(or such other Person or Persons as the Act may require or permit) shall file a
certificate of cancellation with the Secretary of State of Delaware and take
such other actions as may be necessary to terminate the existence of the
Company. Upon the filing of such certificate of cancellation, the existence of
the Company shall terminate, except as may be otherwise provided by the Act or
by Applicable Law.
GENERAL
PROVISIONS
SECTION 13.01 Offset.
Whenever
the Company is to pay any sum to any Member, any amounts that Member owes the
Company may be deducted from that sum before payment.
SECTION
13.02 Notices.
All
notices, demands, requests, consents, approvals or other communications
(collectively, “Notices”) required or
permitted to be given hereunder or which are given with respect to this
Agreement shall be in writing and shall be personally served, delivered by
reputable air courier service with charges prepaid, or transmitted by hand
delivery, telegram, telex or facsimile, addressed as set forth below, or to such
other address as such party shall have specified most recently by written
notice. Notice shall be deemed given on the date of service or transmission if
personally served or transmitted by telegram, telex or facsimile. Notice
otherwise sent as provided herein shall be deemed given upon delivery of such
notice:
To the
Company:
Blueknight
Energy Partners G.P., L.L.C.
Two
Xxxxxx Place
0000
Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx,
Xxxxxxxx 00000
Telephone:
(000) 000-0000
Fax:
(000) 000-0000
To BKEP
Holdings:
Blueknight
Energy Holding, Inc.
Two
Xxxxxx Place
0000
Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxx,
Xxxxxxxx 00000
Telephone:
(000) 000-0000
Fax:
(000) 000-0000
29
SECTION 13.03 Entire Agreement;
Superseding Effect.
This
Agreement constitutes the entire agreement of the Members relating to the
Company and the transactions contemplated hereby, and supersedes all provisions
and concepts contained in all prior contracts or agreements between the Members
with respect to the Company, whether oral or written.
SECTION 13.04 Effect of Waiver or
Consent.
Except as
otherwise provided in this Agreement, a waiver or consent, express or implied,
to or of any breach or default by any Member in the performance by that Member
of its obligations with respect to the Company is not a consent or waiver to or
of any other breach or default in the performance by that Member of the same or
any other obligations of that Member with respect to the Company. Except as
otherwise provided in this Agreement, failure on the part of a Member to
complain of any act of any Member or to declare any Member in default with
respect to the Company, irrespective of how long that failure continues, does
not constitute a waiver by that Member of its rights with respect to that
default until the applicable statute-of-limitations period has run.
SECTION
13.05 Amendment or
Restatement.
This
Agreement may be amended or restated only by a written instrument executed by
all Members;
provided,
however, that notwithstanding anything to the contrary contained in this
Agreement, each Member agrees that the Board, without the approval of any
Member, may amend any provision of the Delaware Certificate and this Agreement,
and may authorize any Officer to execute, swear to, acknowledge, deliver, file
and record any such amendment and whatever documents may be required in
connection therewith, to reflect any change that does not require consent or
approval (or for which such consent or approval has been obtained) under this
Agreement or does not materially adversely affect the rights of the
Members.
SECTION 13.06 Binding
Effect.
Subject
to the restrictions on Dispositions set forth in this Agreement, this Agreement
is binding on and shall inure to the benefit of the Members and their respective
successors and permitted assigns.
SECTION 13.07 Governing Law;
Severability.
THIS
AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAW OF
THE STATE OF DELAWARE, EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT
MIGHT REFER THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAW OF
ANOTHER JURISDICTION. In the event of a direct conflict between the provisions
of this Agreement and any mandatory, non-waivable provision of the Act, such
provision of the Act shall control. If any provision of the Act may be varied or
superseded in a limited liability company agreement (or otherwise by agreement
of the members or managers of a limited liability company), such provision shall
be deemed superseded and waived in its entirety if this Agreement contains a
provision addressing the same issue or subject matter. If any provision of this
Agreement or the application thereof to any Member or circumstance is held
invalid or unenforceable to any extent, (a) the remainder of this Agreement
and the application of that provision to other Members or circumstances is not
affected thereby, and (b) the Members shall negotiate in good faith to
replace that provision with a new provision that is valid and enforceable and
that puts the Members in substantially the same economic, business and legal
position as they would have been in if the original provision had been valid and
enforceable.
30
SECTION 13.08 Further
Assurances.
In
connection with this Agreement and the transactions contemplated hereby, each
Member shall execute and deliver any additional documents and instruments and
perform any additional acts that may be necessary or appropriate to effectuate
and perform the provisions of this Agreement and those
transactions.
SECTION 13.09 Waiver of Certain
Rights.
Each
Member irrevocably waives any right it may have to maintain any action for
dissolution of the Company or for partition of the property of the
Company.
SECTION 13.10 Counterparts.
This
Agreement may be executed in any number of counterparts with the same effect as
if all signing parties had signed the same document. All counterparts shall be
construed together and constitute the same instrument.
SECTION
13.11 Suspension of Certain
Provisions If Only One Member.
(a) The
following definitions in Article I of this Agreement shall be suspended and
shall have no force or effect at any time that there is only one Member of the
Company:
(i) “Adjusted
Capital Account Deficit,”
(ii) “Capital
Account,”
(iii) “Depreciation,”
(iv) “Gross
Asset Value,”
(v) “Profits”
and “Losses,” and
(vi) “Target
Capital Account Amount.”
(vii) “Tax
Matters Member.”
(b) The
following provision of this Agreement shall be suspended and shall have no force
or effect at any time that there is only one Member of the Company:
(i) Section 3.06
(Notice);
(ii) Section 4.01
(General Restriction);
(iii) Section 5.04
(Capital Accounts);
(iv) Section 6.03
(Allocations);
(v) Section 6.04
(Varying Interests);
(vi) Section 6.05
(Withheld Taxes); and
(vii) Section 10.03
(Tax Matters Member).
31
IN WITNESS WHEREOF, the Member has
executed this Agreement as of the date first set forth above.
MEMBER:
BLUEKNIGHT
ENERGY HOLDING, INC.
By: /s/ Xxxxx X. Xxxx,
XX _
Signature Page to Second Amended and
Restated LLC Agreement
Member
|
Sharing
Ratio
|
Effective
Capital Contribution
|
||
Blueknight
Energy Holding, Inc.
|
100% | $1,000.00 |
A-1
DIRECTORS
Duke
X. Xxxxx
|
Director
|
Xxxxx
Xxxxx
|
Director
|
Xxxxxx
X. Xxxx
|
Director
|
Xxxxx
X. Xxxx, XX
|
Director
|
Xxxxxxxxxxx
X. Xxxxx
|
Director
|
Xxxxxx
X. Xxxxxxxx
|
Director
|
Xxxx
X. Xxxxxxx
|
Director
|
B-1
OFFICERS
J.
Xxxxxxx Xxxxxxxx
|
President
and Chief Operating Officer
|
Xxxx
X. Xxxxxxxxx
|
Chief
Financial Officer and Secretary
|
Xxxxx
X. Xxxxxxx
|
Chief
Accounting Officer
|
Xxxxx
X. Xxxxxxx
|
Executive
Vice President—Asphalt Operations
|
Xxxxx
X. Xxxxxxxxxx
|
Executive
Vice President—Crude Operations
|
C-1