Contract
EXHIBIT
4.A
AMENDMENT
NO. 1 TO
EL PASO PIPELINE
PARTNERS, L.P.
This Amendment No. 1
(“Amendment No. 1”) to the First Amended and Restated Agreement of Limited
Partnership (as amended, the “Partnership Agreement”) of El Paso Pipeline
Partners, L.P. (the “Partnership”) is hereby adopted by El Paso Pipeline GP
Company, L.L.C., a Delaware limited liability company (the “General Partner”),
as general partner of the Partnership. Capitalized terms used but not
defined herein are used as defined in the Partnership Agreement.
WHEREAS,
the General Partner desires to amend the Partnership Agreement to make certain
adjustments to certain allocation provisions and the definitions related
thereto, which adjustments shall be effective on January 1, 2008;
and
WHEREAS,
acting pursuant to the power and authority granted to it under Section 13.1(d)
of the Partnership Agreement, the General Partner has determined that the
following amendment to the Partnership Agreement does not require the approval
of any Limited Partner.
NOW
THEREFORE, the General Partner does hereby amend the Partnership Agreement as
follows:
Section
1. Amendment.
(a) Section
1.1 is hereby amended to add or amend and restate the following
definitions:
“Disposed
of Adjusted Property” has the meaning assigned to such term in Section
6.1(d)(xii)(B).
“Net
Termination Gain” means, for any taxable year, the sum, if positive, of
all items of income, gain, loss or deduction recognized by the Partnership (a)
after the Liquidation Date or (b) upon the sale, exchange or other disposition
of all or substantially all of the assets of the Partnership Group, taken as a
whole, in a single transaction or a series of related transactions (excluding
any disposition to a member of the Partnership Group). The items included in the
determination of Net Termination Gain shall be determined in accordance with
Section 5.5(b) and shall not include any items of income, gain or loss specially
allocated under Section 6.1(d).
“Net
Termination Loss” means, for any taxable year, the sum, if negative, of
all items of income, gain, loss or deduction recognized by the
Partnership (a) after the Liquidation Date or (b) upon the sale, exchange or
other disposition of all or substantially all of the assets of the Partnership
Group, taken as a whole, in a
single transaction or a series of related transactions (excluding any
disposition to a member of the Partnership Group). The items included in the
determination of Net Termination Loss shall be determined in accordance with
Section 5.5(b) and shall not include any items of income, gain or loss specially
allocated under Section 6.1(d).
(b) Section
5.5(d) is hereby amended and restated in its entirety as
follows:
(i)
In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), on an
issuance of additional Partnership Interests for cash or Contributed Property,
the issuance of Partnership Interests as consideration for the provision of
services or the conversion of the General Partner’s Combined Interest to Common
Units pursuant to Section 11.3(b), the Capital Accounts of all Partners and the
Carrying Value of each Partnership property immediately prior to such issuance
shall be adjusted upward or downward to reflect any Unrealized Gain or
Unrealized Loss attributable to such Partnership property, as if such Unrealized
Gain or Unrealized Loss had been recognized on an actual sale of each such
property immediately prior to such issuance for an amount equal to its fair
market value and had been allocated to the Partners at such time pursuant to
Section 6.1(c) in the same manner as any item of gain or loss actually
recognized following an event giving rise to the dissolution of the Partnership
would have been allocated. In determining such Unrealized Gain or Unrealized
Loss, the aggregate cash amount and fair market value of all Partnership assets
(including cash or cash equivalents) immediately prior to the issuance of
additional Partnership Interests shall be determined by the General Partner
using such method of valuation as it may adopt; provided, however, that the
General Partner, in arriving at such valuation, must take fully into account the
fair market value of the Partnership Interests of all Partners at such time. The
General Partner shall allocate such aggregate value among the assets of the
Partnership (in such manner as it determines) to arrive at a fair market value
for individual properties.
(ii)
In accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(f), immediately
prior to any actual or deemed distribution to a Partner of any Partnership
property (other than a distribution of cash that is not in redemption or
retirement of a Partnership Interest), the Capital Accounts of all Partners and
the Carrying Value of all Partnership property shall be adjusted upward or
downward to reflect any Unrealized Gain or Unrealized Loss attributable to such
Partnership property, as if such Unrealized Gain or Unrealized Loss had been
recognized on an actual sale of each such property immediately prior to such
distribution for an amount equal to its fair market value, and had been
allocated to the Partners, at such time, pursuant to Section 6.1(c) in the same
manner as any item of gain or loss actually recognized following an event giving
rise to the dissolution of the Partnership would have been allocated. In
determining such Unrealized Gain or Unrealized Loss the aggregate cash amount
and fair market value of all Partnership assets (including cash or cash
equivalents) immediately prior to a distribution shall (A) in the case of an
actual distribution that is not made pursuant to Section 12.4 or in the case of
a deemed distribution, be determined and allocated in the same manner as that
provided in Section 5.5(d)(i) or (B) in the case of a liquidating distribution
pursuant to Section 12.4, be determined and allocated by the Liquidator using
such method of valuation as it may adopt.
(c) Section
6.1(d)(xii) is hereby amended and restated in its entirety as
follows:
(xii)
Corrective
and Other Allocations. In the event of any allocation of Additional Book
Basis Derivative Items or any Book-Down Event or any recognition of a Net
Termination Loss, the following rules shall apply:
(A)
Except as provided in Section 6.1(d)(xii)(B), in the case of any allocation of
Additional Book Basis Derivative Items (other than an allocation of Unrealized
Gain or Unrealized Loss under Section 5.5(d) hereof) with respect to any
Partnership property, the General Partner shall allocate such Additional Book
Basis Derivative Items (1) to (aa) the holders of Incentive Distribution Rights
and (bb) the General Partner in the same manner that the Unrealized Gain or
Unrealized Loss attributable to such property is allocated pursuant to Section
5.5(d)(i) or Section 5.5(d)(ii) and (2) to all Unitholders, Pro Rata, to the
extent that the Unrealized Gain or Unrealized Loss attributable to such property
is allocated to any Unitholders pursuant to Section 5.5(d)(i) or Section
5.5(d)(ii).
(B)
In the case of any allocation of Additional Book Basis Derivative Items (other
than an allocation of Unrealized Gain or Unrealized Loss under Section 5.5(d)
hereof or an allocation of Net Termination Gain or Net Termination Loss pursuant
to Section 6.1(c) hereof) as a result of a sale or other taxable disposition of
any Partnership asset that is an Adjusted Property (“Disposed of Adjusted
Property”), the General Partner shall allocate (1) additional items of income
and gain (aa) away from the holders of Incentive Distribution Rights and the
General Partner and (bb) to the Unitholders, or (2) additional items of
deduction and loss (aa) away from the Unitholders and (bb) to the holders of
Incentive Distribution Rights and the General Partner, to the extent that the
Additional Book Basis Derivative Items allocated to the Unitholders exceed their
Share of Additional Book Basis Derivative Items with respect to such Disposed of
Adjusted Property. For this purpose, the Unitholders shall be treated as being
allocated Additional Book Basis Derivative Items to the extent that such
Additional Book Basis Derivative Items have reduced the amount of income that
would otherwise have been allocated to the Unitholders under this Agreement
(e.g., Additional Book Basis Derivative Items taken into account in computing
cost of goods sold would reduce the amount of book income otherwise available
for allocation among the Partners). Any allocation made pursuant to this Section
6.1(d)(xii)(B) shall be made after all of the other Agreed Allocations have been
made as if this Section 6.1(d)(xii) were not in this Agreement and, to the
extent necessary, shall require the reallocation of items that have been
allocated pursuant to such other Agreed Allocations.
(C)
In the case of any negative adjustments to the Capital Accounts of the Partners
resulting from a Book-Down Event or from the recognition of a Net Termination
Loss, such negative adjustment (1) shall first be allocated, to the extent of
the Aggregate Remaining Net Positive Adjustments, in such a manner, as
determined by the General Partner, that to the extent possible the aggregate
Capital Accounts of the Partners will equal the amount that would have been the
Capital Account balance of the Partners if no prior Book-Up Events had occurred,
and (2) any negative adjustment in excess of the Aggregate Remaining Net
Positive Adjustments shall be allocated pursuant to Section 6.1(c)
hereof.
(D)
In making the allocations required under this Section 6.1(d)(xii), the General
Partner may apply whatever conventions or other methodology it determines will
satisfy the purpose of this Section 6.1(d)(xii).
Section
2. Ratification of Partnership Agreement. Except
as expressly modified and amended herein, all of the terms and conditions of the
Partnership Agreement shall remain in full force and effect.
Section
3. Governing Law. This Amendment No. 1
will be governed by and construed in accordance with the laws of the State of
Delaware.
IN
WITNESS WHEREOF, the General Partner has executed this Amendment No. 1 as of
July 28, 2008.
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GENERAL
PARTNER:
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EL
PASO PIPELINE GP COMPANY, L.L.C.
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By:
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/s/ Xxxxxx
X. Xxxxx
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Xxxxxx
X. Xxxxx
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Executive Vice
President and General
Counsel
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