AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF ENERGY XXI GOM, LLC
AMENDED
AND RESTATED
OF
This
Amended and Restated Limited Liability Company Agreement (this “Agreement”)
of ENERGY XXI GOM, LLC is entered into this 5th day of April, 2006 by the sole
member, Energy XXI Gulf Coast, Inc. (the “Member”)
pursuant to and in accordance with the Delaware Limited Liability Company Act (6
Del.C. §
18-101, et
seq.”), as
amended from time to time (the “Act”).
1. Name. The
name of the limited liability company governed hereby is ENERGY XXI GOM, LLC
(the “Company”).
2. Certificate of Formation;
Certificate of Amendment. The Member filed the Certificate of
Formation of the Company with the Secretary of State of the State of Delaware on
April 28, 1999. The Member filed a Certificate of Amendment of the
Company with the Secretary of State of the State of Delaware on April 5, 2005
changing the Company’s name from “Xxxxxx Energy Offshore, L.L.C.” to “Energy XXI
GOM, LLC”.
3. Purpose. The
Company is formed for the object and purpose of, and the nature of the business
to be conducted and promoted by the Company is, engaging in all lawful
activities for which limited liability companies may be formed under the
Act.
4. Powers. The
Company shall have the power to do any and all acts reasonably necessary,
appropriate, proper, advisable, incidental or convenient to or for the
furtherance of the purpose and business described herein and for the protection
and benefit of the Company, and shall have, without limitation, any and all of
the powers that may be exercised on behalf of the Company by the Board of
Managers pursuant to this Agreement, including Section 19. The Board
of Managers shall cause all filings as it believes necessary or as are required
by applicable law to give effect to the provisions of this Agreement to be made
and to cause the Company to be treated as a limited liability company under the
laws of State of Delaware.
5. Principal Business
Office. The principal place of business and office of the
Company shall be located at, and the Company’s business shall be conducted from,
such place or places as may hereafter be determined by the Board of
Managers.
6. Registered
Office. The address of the registered office of the Company in
the State of Delaware is:
The
Corporation Trust Company
Corporation
Trust Center
0000
Xxxxxx Xxxxxx
Xxxxxxxxxx,
Xxx Xxxxxx Xxxxxx, Xxxxxxxx 00000
7. Registered
Agent. The name and address of the registered agent of the
Company for service of process on the Company in the State of Delaware
are:
The
Corporation Trust Company
Corporation
Trust Center
0000
Xxxxxx Xxxxxx
Xxxxxxxxxx,
Xxx Xxxxxx Xxxxxx, Xxxxxxxx 00000
8. Qualification in Other
Jurisdictions. The Board of Managers shall cause the Company
to be registered or qualified under its own name or under an assumed or
fictitious name pursuant to a foreign limited liability company statute or
similar laws in any jurisdictions in which the Company owns property or
transacts business if such registration or qualification is necessary to protect
the limited liability of the Member or to permit the Company lawfully to own
property or transact business in such jurisdiction.
9. Amended and Restated
Agreement. This Agreement amends and restates in its entirety
that certain Amended and Restated Limited Liability Company Agreement of Duke
Energy Hydrocarbons, L.L.C. dated June 17th, 2003, as amended.
10. RESERVED.
11. Term. The
term of the Company commenced on the date of filing of the Certificate of
Formation of the Company in accordance with the Act and shall continue until
dissolution of the Company in accordance with Section 25 of this
Agreement.
12. Limited
Liability. Except as otherwise provided by the Act, the debts,
obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be solely the debts, obligations and liabilities of the
Company, and none of the Member, Managers, Officers, employees or agents of the
Company (including a person having more than one such capacity) shall be
obligated personally for any such debt, obligation or liability of the Company
solely by reason of acting in such capacity.
13. RESERVED.
14. RESERVED.
15. Funding Capital
Requirements. In the event that the Company requires
additional funds to carry out its purposes, to conduct its business, or to meet
its obligations, the Company may borrow funds from such lender(s), including
Managers and the Member, and on such terms and conditions as are approved by a
majority of the Board of Managers. No loan made to the Company by the
Member or any Manager shall constitute a capital contribution to the Company for
any purpose.
16. Capital
Accounts. A capital account shall be maintained for the Member
on the books of the Company. The capital account shall be adjusted in
accordance with the Internal Revenue Code of 1986, as amended (the “Code”) and
any other applicable provision of the Code and related Regulations (as defined
below). Such capital account maintenance provisions, together with
the other provisions of this Agreement are intended to and shall further be
interpreted and adjusted to comply with the Regulations under Section 704(b) of
the Code, and in particular with Regulations 1.704-1(b), as determined in good
faith by the Board of Managers. The Member will have no obligation to
restore any negative balance in their respective capital
account. Except as otherwise provided in the Regulations, a
transferee of all of a portion of the Member’s Units shall succeed to the
capital account of the transferor to the extent allocable to the transferred
Units.
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17. Allocations; Tax Allocations
and Elections.
a. Allocations. For
each fiscal year of the Company, after adjusting the Member’s capital account
for all capital contributions and distributions during such fiscal
year. Net Income and Net Loss (as each term is defined below) shall
be allocated to the Member’s capital account in a manner such that, as of the
end of such fiscal year, the capital account of the Member (which may be a
positive or negative amount) shall be equal to (i) the amount which would be
distributed to the Member if the Company were dissolved, its affairs wound up
and its assets sold for cash equal to their Gross Asset Values, all Company
liabilities were satisfied (limited with respect to each nonrecourse liability
to the Gross Asset Value of the assets securing such liability), and the net
assets of the Company were distributed to the Member immediately after making
such allocation, minus (ii) the sum of (A) the Member’s share of minimum gain
(as determined according to Treasury Regulation Sections 1.704-2(d), (g) (1) and
(g)(3)) and Member nonrecourse debt minimum gain (as determined according to
Treasury Regulation Section 1.704-2(i) with respect to “partner nonrecourse debt
minimum gain”), and (B) the amount, if any, for which the Member would be liable
to the Company under this Agreement determined as if the Company were to
liquidate its assets for their Gross Asset Values and distribute the
proceeds.
b. Tax
Allocations. Except as otherwise provided herein or required
by the Code or applicable Regulations or applicable state law, items of income,
gain, loss and deduction shall be allocated to the Member for federal and state
income tax purposes.
c. Tax Classification of the
Company. It is intended that the Company be classified as a
disregarded entity for purposes of United States federal income tax
purposes.
d. Other Tax
Elections. Except as provided in Section 17.c hereof, relating
to the tax classification of the Company, the Board of Managers may make, or not
make, in its sole and absolute discretion, any tax election provided under the
Code, or any provision of state, local or foreign tax law. Any
determination made pursuant to this Section 17.d by the Board of Managers shall
be conclusive and binding on the Member
18. RESERVED.
19. Management.
a. In
accordance with Section 18-402 of the Act, management of the Company shall be
vested in the board of managers of the Company (the “Board of
Managers” and each separately a “Manager”). Managers
do not have to hold Units in the Company as Members of the Company in order to
serve as a Manager. The Board of Managers shall have the power to do
any and all acts necessary, convenient or incidental to or for the furtherance
of the purposes described herein, including all powers, statutory or otherwise,
possessed by managers of a limited liability company under the laws of the State
of Delaware and including all things necessary to carry out the terms and
provisions of this Agreement. The Board of Managers has the authority
to bind the Company. Unless otherwise consented to by at least a
majority of the Board of Managers, the Board of Managers shall hold regular
meetings not less frequently than once every fiscal quarter at a time and place
fixed by the Board of Managers. Direct travel expenses in connection
with Board functions will be paid by the Company.
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b. The Board
of Managers shall consist of three (3) Managers, to be appointed by the
Member.
c. Managers
may withdraw at any time. Managers may be removed at any time for any
reason or no reason and shall promptly be replaced by the consent of a majority
of the remaining Managers.
d. Unless
otherwise expressly provided herein, consent of the Board of Managers for
purposes of this Agreement may be obtained by the unanimous written consent of
the Managers.
e. Unless
otherwise expressly provided herein, consent of the Member for purposes of this
Agreement may be obtained by written consent of the Member.
20. Officers. The
Board of Managers shall designate in writing from time to time the following
officers of the Company: President, Secretary and Treasurer and may, as it deems
advisable, appoint other officers of the Company and assign in writing titles to
any such person (collectively the “Officers”). Each
Officer will have the authority to execute agreements on behalf
of the Company with respect to those documents which are commonly signed by such
officers of a business corporation formed under the Delaware General
Law.
Unless
the Board of Managers decides otherwise, if the title assigned to an Officer is
one commonly used for officers of a business corporation formed under the
Delaware General Company Law, the assignment of such title shall constitute the
delegation to such person of the authorities and duties that are normally
associated with that office. Any delegation pursuant to this Section
20 may be revoked at any time by the Board of Managers.
21. RESERVED.
22. Exculpation and
Indemnification. Neither the Member, Managers nor Officers
(each an “i”) shall be
liable to the Company or any other person or entity who has an interest in the
Company for any loss, damage or claim (a “Loss”) (or
any expenses or costs associated therewith (“Costs”))
incurred by reason of any act or omission performed or omitted by such
Indemnified Party in good faith on behalf of the Company and in a manner
reasonably believed to be within the scope of the authority conferred on such
Indemnified Party by this Agreement, except that an Indemnified Party shall be
liable for any such Loss and Costs, incurred by reason of such Indemnified
Party’s gross negligence or willful misconduct. To the full extent
permitted by applicable law, an Indemnified Party shall be entitled to
indemnification from the Company for any Loss or Costs incurred by such
Indemnified Party by reason of any act or omission performed or omitted by such
Indemnified Party in good faith on behalf of the Company and in a manner
reasonably believed to be within the scope of the authority conferred on such
Indemnified Party by this Agreement, except that no Indemnified Party shall be
entitled to be indemnified in respect of any Loss or Costs incurred by such
Indemnified Party by reason of such Indemnified Party’s gross negligence or
willful misconduct with respect to such acts or omissions; provided, however, that any
indemnity under this Section 22 shall be provided out of and to the extent of
Company assets only, and no Member, Manager or Officer shall have personal
liability on account thereof. The Company shall advance Costs
incurred by or on behalf of an Indemnified Party in connection with any Loss
within twenty (20) days after receipt by the Company from the Indemnified Party
of a statement requesting such advances from time to time; provided such
statement provides reasonable documentary evidence of such Costs and provides a
written undertaking by the Indemnified Party to repay any and all advanced Costs
in the event such Indemnified Party is ultimately determined to not be entitled
to indemnification by the Company.
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23. Admission of Additional
Members. One (1) or more additional members of the Company may
be admitted to the Company with the written consent of the Board of
Managers.
24. RESERVED.
25. Dissolution and Winding
Up.
a. Dissolution. The
Company shall dissolve, and its affairs shall be wound up, upon the first to
occur of the following: (i) the written consent of a majority of the Board of
Managers, (ii) the sale of all of the assets of the Company; and (iii) the entry
of a decree of judicial dissolution under Section 18-802 of the
Act.
b. Liquidation.
(i) Upon
dissolution of the Company, the Board of Managers or, if one is appointed, an
authorized liquidating trustee shall wind up the Company’s
affairs. Upon termination and dissolution of the Company and
liquidation of its assets, the Board of Managers or liquidating trustee, as the
case may be, shall apply the Company’s assets to the payment of all liabilities
owing to creditors in accordance with the applicable law. The Board
of Managers or liquidating trustee, as the case may be, shall set up such
reserves as it deems reasonably necessary for any contingent or unforeseen
liabilities or obligations of the Company. Said reserves may be paid
by the Board of Managers or liquidating trustee, as the case may be, upon
dissolution to a bank or trust company to be held in escrow for the purpose of
paying any such contingent or unforeseen liabilities or obligations and, at the
expiration of such period or occurrence of such events as the Board of Managers
or liquidating trustee, as the case may be, may in establishing such reserves
deem advisable, such reserves shall be distributed to the Member or its assigns
in the manner set forth in this Section 25.b.
(ii) After
paying liabilities and providing for reserves in accordance with subparagraph
(i) of this Section 25 .b, the Board of Managers or liquidating trustee, as the
case may be, shall make a final allocation of all items comprising Net Income
and Net Loss to the Member’s Capital Account in accordance with Section
16. The remaining assets of the Company shall then be distributed to
the Member.
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26. RESERVED.
27. Certain
Definitions.
“Gross
Asset Value” means, with respect to any asset, the asset’s adjusted basis
for federal income tax purposes, except as follows:
(i) the Gross
Asset Value of any asset contributed by the Member to the Company is the gross
fair market value of such asset as determined at the time of
contribution;
(ii) the Gross
Asset Value of all Company assets shall be adjusted to equal their respective
gross fair market values, as determined by a majority of the Board of Managers;
and
(iii) The Gross
Asset Value of any Company asset distributed to the Member shall be adjusted to
equal the gross fair market value of such asset on the date of distribution as
determined by a majority of the Board of Managers.
“Net
Income” and “Net
Loss” means, for each fiscal year or other period, an amount equal to the
Company’s taxable income or loss for such fiscal year or period, determined in
accordance with Code Section 703(a) (for this purpose, all items of income,
gain, loss or deduction required to be stated separately pursuant to Code
Section 703(a)(1) 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 Net Income or Net Loss pursuant to this
paragraph shall be added to such income or loss;
(ii) Any
expenditures of the Company described in Code Section 705(a)(2)(B) or treated as
Code Section 705(a)(2)(B) expenditures pursuant to Regulations Section
1.704-(l)(b)(2)(iv)(/), and not otherwise taken into account in computing Net
Income or Net Loss pursuant to this paragraph, shall be subtracted from such
taxable income or loss;
(iii) In the
event the Gross Asset Value of any Company asset is adjusted pursuant to
subdivisions (ii) or (iii) of the definition of “Gross Asset Value” herein, the
amount of such adjustment shall be taken into account as gain or loss from the
disposition of such asset for purposes of computing Net Income or Net
Loss;
(iv) Gain or
loss resulting from any disposition of Company property 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 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, computed in accordance with the
definition of “Depreciation”; and
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“Units”
means the Units of the Company.
“Regulations”
means the Income Tax Regulations promulgated under the Code, as amended from
time to time.
28. Separability of
Provisions. Each provision of this Agreement shall be
considered separable and if for any reason any provision or provisions herein
are determined to be invalid, unenforceable or illegal under any existing or
future law, such invalidity, unenforceability or illegality shall not impair the
operation of or affect those portions of this Agreement which are valid,
enforceable and legal.
29. Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original of this Agreement.
30. Entire
Agreement. This Agreement constitutes the entire agreement of
the Member with respect to the subject matter hereof.
31. Governing
Law. This Agreement shall be governed by, and construed under,
the laws of the State of Delaware (without regard to conflict of laws principles
thereof), and all rights and remedies shall be governed by such
laws.
32. Amendments. This
Agreement may not be modified, altered, supplemented or amended except pursuant
to a written consent of the Member.
33. RESERVED.
IN
WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, have
duly executed this Agreement as of the date first written above.
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MEMBER:
ENERGY
XXI GULF COAST, INC.
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By:
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/s/ Xxxxxx Xxxxx | |
| Xxxxxx Xxxxx, President | |||
