Exhibit 10.5
------------
Gulfedge Limited Partnership
AGREEMENT OF LIMITED PARTNERSHIP
THIS AGREEMENT OF LIMITED PARTNERSHIP is entered into and
effective as of April 1, 1991, by and among EDGE PETROLEUM CORPORATION,
with offices at 0000 Xxxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, as
general partner (hereinafter referred to as the "General Partner") and each
of the other parties executing this Agreement or counterpart hereof as
limited partners (the "Limited Partners") (the General Partner and the
Limited Partners shall hereinafter be referred to collectively as the
"Partners").
W I T N E S S E T H:
ARTICLE 1
(S) 1.1 Formation of Partnership
The parties hereto hereby form, pursuant to the Uniform Limited
Partnership Act of the State of Texas, a Limited Partnership, which
organization is referred to as the "Partnership." Closing of the
Partnership shall be on April 1, 1991.
(S) 1.2 Organization Certificates
The parties hereto shall immediately execute all such
certificates and other documents conforming hereto and do all such filing,
recording, publishing and other acts as may be appropriate to comply with
all requirements for the laws of the State of Texas. The parties hereto
also agree to execute all such certificates and other documents conforming
hereto and to do all such filing, recording, publishing and other acts as
may be appropriate to comply with the requirement of law for the
jurisdictions where the Partnership shall desire to conduct business. Prior
to conducting any business in any jurisdiction, the Partnership shall
comply with all requirements for the qualification of the Partnership to
conduct business as a limited partnership in such jurisdiction.
(S) 1.3 Partnership Name
The business of the Partnership shall be conducted under the name
"Gulfedge Limited Partnership" in those jurisdictions where such name is
permitted and under such variations of this name
as the General Partner deems appropriate to comply with the laws of the
other jurisdictions in which the Partnership does business.
(S) 1.4 Rejection
The General Partner, in his sole absolute discretion, may, at any
time prior to the date the Partnership becomes effective, reject any
subscription for any reason.
ARTICLE 2
(S) 2.1 Definitions
Whenever used in this Agreement, the following terms shall have
the meanings respectively assigned to them in this (S) 2.1:
2.1.a "Agreement" means this Agreement of Limited
Partnership as it may be further amended from time to time.
2.1.b "Capital Contribution" shall mean the amount of
money which a Partner has paid into the Partnership capital.
2.1.c "Code" shall mean the Internal Revenue Code of
1986, as amended from time to time, and regulations thereunder at the
time of reference thereto.
2.1.d "Consent of the Partners" means the written
consent or approval of Partners (General and Limited) whose aggregate
Capital Contributions represent at least sixty percent (60%) of the
aggregate Capital Contributions, which consent or approval shall be
obtained prior to the taking of the action for which it is required
hereunder.
2.1.e "Events of Bankruptcy" means, as to a General
Partner:
2.1.e.i its admission, in writing, of its inability
to pay its debts generally as they become due;
2.1.e.ii its filing a petition in bankruptcy or for
reorganization or for adoption of an arrangement under the Bankruptcy
Act;
2.1.e.iii its making an assignment for the benefit of
creditors;
2
2.1.e.iv its consenting to the appointment of a
receiver for all or a substantial part of its property;
2.1.e.v its being adjudicated as bankrupt;
0.0.x.xx the entry of a court order appointing a
receiver or trustee(s) for all or a substantial part of its property
without its consent, which order shall not be vacated, set aside or
stayed within sixty (60) days from the date of entry; and/or
2.1.e.vii the assumption of custody or sequestration by
a court of competent jurisdiction of all or substantially all of its
property, which custody or sequestration shall not be suspended or
terminated within sixty (60) days from its inception.
2.1.f "Limited Partner or Limited Partners" means any or
all of those persons designated as Limited Partners in the Partnership
Certificate, or any person who becomes a substitute Limited Partner as
provided herein, in each person's capacity as a Limited Partner of the
Partnership.
2.1.g "Partner" means a General Partner or Limited
Partner.
2.1.h "Partnership" means the Limited Partnership
governed by this Agreement as said Limited Partnership may from time
to time be constituted as amended.
2.1.i "Partnership Properties" shall mean all interests,
properties and rights of any type owned by the Partnership.
2.1.j "Joint Venture Agreement" shall mean the Joint
Venture Agreement to be entered into between this Partnership, Edge
Petroleum Corporation ("EPC") and the Edge Group II Limited
Partnership ("Edge Group II) at or before the Funding Date to form the
Edge Group Joint Venture II.
2.1.k "Funding Date" shall mean the date upon which this
Partnership makes its initial Capital Contribution to the Edge Group
Joint Venture II and EPC and Edge Group II make their Capital
Contribution to the edge Group Joint Venture II.
2.1.l "EPC" shall mean Edge Petroleum Corporation, a to
be formed Texas corporation with which
3
this Partnership will enter into a Joint Venture for the generation,
development and marketing of oil and gas Prospects, substantially as
set forth in the Private Placement Memorandum dated December 13, 1990
which is attached to this Partnership Agreement as an Exhibit.
2.1.m "Capital Contribution" of a Partner shall mean the
amount of cash which the Partner has contributed towards meeting such
Partner's Capital Commitment.
2.1.n "Capital Commitment" of a Partner shall mean the
amount of capital such Partner has committed to contribute to the
Partnership, including the amount paid on Closing and the amount due
on or before July 1, 1992. Each Partner's Capital Commitment is set
forth on the signature page of this Agreement.
2.1.o "Simulated Depletion Deductions" means the
simulated depletion allowance computed by the Partnership with respect
to each oil and gas property by using either the cost depletion method
or the percentage depletion method (computed in accordance with
Internal Revenue Code Section 613 at the rates specified in Section
613(c)(5) without regard to the limitation of Section 613A, which
theoretically could apply to any partner) for each taxable year that
the property is owned by the Partnership and subject to depletion, in
accordance with Treas.Reg. Section 1.704-1(b)(2)(iv)(k).
2.1.p "Simulated Gains" and "Simulated Losses" mean,
respectively, the simulated gains or simulated losses computed by the
Partnership with respect to its oil and gas properties pursuant to
Treas.Reg Section 1.704-1(b)(2)(iv)(k).
2.1.q "Limited Partner Percentage" shall mean for each
Limited Partner as of any date the amount of such Limited Partner's
Capital Account divided by the sum of Capital Accounts of all Limited
Partners as of such date.
2.1.r "Cash Flow" means the Gross Cash Proceeds from
Partnership Operations less the portion thereof used to pay
Partnership expenses.
2.1.s "Special Unit" means the units in the Partnership
acquired by the Special Limited Partners.
4
ARTICLE 3
(S) 3.1 Purposes and Powers of the Partnership
The principal purpose of the Partnership shall be to enter into
the Joint Venture Agreement with EPC and the Edge Group II for the purpose
of engaging in the business of prospect generation and sales, and
activities relating thereto, within the Continental United States and
offshore state waters as described in a Private Placement Memorandum for
the Edge Group II dated December 13, 1990 which is attached to the
Partnership Agreement as an Exhibit. The purposes of this Partnership may
be accomplished through:
3.1.a the employment of such parties and
personnel and such legal, accounting, geological, geophysical
and engineering services and advice as the General Partner
deems advisable;
3.1.b the payment (or where appropriate in the
judgment of the General Partner, the failure to make payment)
of delay rentals on leases or leasehold interests;
3.1.c the making or giving of dryhole or
bottomhole contributions in the form of acreage, money or
both;
3.1.d the execution and amendment of all
documents or instruments of any kind which the General Partner
may deem appropriate for carrying out the purposes of the
Partnership;
3.1.e the purchase and establishment of
inventories of pipe and other equipment and material;
3.1.f the borrowing of money or the incurring of
purchase money or other debt for Partnership purposes and the
mortgaging and pledging of Partnership Properties for the
repayment of any such debt; no person or entity to which any
such debt is owed shall be required to inquire as to the
purposes for which such debt is incurred and, as between the
Partnership and such person or entity, it shall be
conclusively presumed that the proceeds of such loan are to be
and will be used for purposes authorized under the terms of
this Agreement;
3.1.g the holding of Partnership Properties in
the name of a nominee chosen by the General Partner if it
shall deem such action appropriate;
5
3.1.h the administration of non-producing properties;
3.1.i the sale, relinquishment, release, Farm Out or
other disposition of any producing and non-producing leases, leasehold
interests or contractual rights to acquire such interests or undivided
interest therein (even if such sale or disposition results in the sale
of all or substantially all of the assets of the Partnership), which,
in the judgment of the General Partner, should be sold, released,
farmed out, relinquished or otherwise disposed of;
3.1.j the producing, treating, transporting and
marketing of oil and gas and the execution of division orders, gas
sales contracts and other marketing agreements;
3.1.k to execute or amend the Joint Venture Agreement or
other joint venture or general or limited partnership agreements or
any other agreements or undertakings which the General Partner may
determine in its sole discretion is necessary or advisable in order to
carry out the purposes of the Partnership to furnish and give consents
to perform and to transact business under the Joint Venture Agreement,
and other agreements in a manner which the General Partner deems in
its discretion is necessary or desirable in order to carry out the
purposes of the Partnership.
3.1.l associating the partnership with others in
partnerships, joint ventures and other associations.
3.1.m to enter into, make, amend and perform all such
contracts, agreements and other undertakings as the General Partner in
its sole discretion may determine to be necessary or advisable or
incident to the carrying out of the objects and purposes of the
Partnership.
3.1.n to do any and all acts required of the
Partnership, and exercise all rights of the Partnership, with respect
to the Partnershp's interest in any Selected Company.
3.1.o to take such other actions as may be necessary or
advisable in connection with the foregoing.
3.1.p to consult with legal counsel and with independent
public accountants selected by the General Partner on behalf and at
the expenses of the Partnership (and any action which the General
Partner
6
takes or omits to take in good faith in reliance upon and in
accordance with the opinion or advice of such counsel or accountants
shall afford full protection and justification for the General Partner
with respect to the action taken or omitted).
ARTICLE 4
(S) 4.1 Principal Office
The executive officers of the Partnership are at 0000 Xxxxxx
Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx, and the Partnership shall conduct
business at such location and any additional locations as may from time
to time be determined by the General Partner.
(S) 4.2 Term of Partnership
The Partnership shall be effective from and after the date set
forth in the first sentence of this Agreement. The Partnership shall
continue in existence until December 31, 2020, unless sooner terminated
pursuant to any provisions of the Texas Revised Limited Partnership Act.
ARTICLE 5
(S) 5.1 Commitment of General Partner
The General Partner shall contribute $100 to the capital of the
Partnership. Other than as required by (S) 12.2.c, 12.2.d, the General
Partner is not committed to (but may) contribute any other cash or
property and may do so as a Limited Partner.
ARTICLE 6
(S) 6.1 Payments of the Capital Contributions of the Limited Partners
Each Limited Partner shall contribute the sum of $64,500 per unit
to the Capital of the Partnership, payable $54,500 by certified or bank
check or checks at closing and $10,000, in the form of the promissory
note attached hereto as an Exhibit, due on or before July 1, 1992.
(S) 6.2 Nature of Contributions
No Limited Partner shall be required to contribute any capital to
the partnership other than as provided in Article 6 hereof or to lend any
funds to the Partnership. No interest shall be paid to a Limited Partner
on any capital contributed to the
7
Partnership pursuant to this Article 6 and except as otherwise provided
herein no Partner may withdraw his Capital Contribution.
(S) 6.3 Defaults in Payment of Capital Contributions
It shall constitute an "Event of Default" for any Limited Partner
to fail to pay the promissory note if such failure to pay continues for a
period of 10 days after notice of such failure to pay has been given to the
Limited Partner by the General Partner. Upon the occurrence of an Event of
Default, the General Partner shall have full power, in its sole discretion,
without prejudice to any other rights the Partnership may have under this
Agreement, to do any one or more of the following:
(a) to allow the defaulting Limited Partner to continue as a Limited
Partner and credit any distributions to which the defaulting Limited
Partner is then or thereafter may become entitled against such Limited
Partner's obligation to the Partnership; or
(b) to cause suit to be brought against the defaulting Limited
Partner to collect all of any part of the unpaid portion of the Capital
Commitment of such defaulting Limited Partner, together with (i) interest
at the rate of 18% per annum or, if lower, the maximum rate permitted by
law, from the date on which such defaulting Limited Partner's Capital
Commitment was first due to be paid to the Partnership and (ii) all
collection expenses, including attorneys' fees incurred by the Partnership
in connection with the collection of the unpaid portion of such Limited
Partner's Capital Commitment; or
(c) to require the defaulting Limited Partner (and the defaulting
Limited Partner will be obligated) to sell to the General Partner and/or to
all the other Limited Partners who wish to purchase the defaulting Limited
Partner's entire interest in the Partnership for such price as the General
Partner in good faith shall determine to be fair and reasonable. In making
such determination, the General Partner shall give consideration to the
amount of such defaulting Limited Partner's Capital Account as at the end
of the quarter immediately preceding the occurrence of the Event of
Default, less any subsequent distributions therefrom. The amount of the
defaulting Limited Partner's Capital Commitment which remains unpaid at the
time of the Event of Default shall be deducted from the purchase price of
such defaulting Limited Partner's interest and each Partner who purchases a
portion of the defaulting Limited Partner's interest in the Partnership
shall assume responsibility for payment of a corresponding portion of the
defaulting Limited Partner's unpaid Capital Commitment. The remaining
portion of the purchase price shall be paid to the defaulting Limited
Partner, provided that the General partner may impose a charge deductible
therefrom and payable to the Partnership in effecting the sale of the
defaulting Limited Partner's interest in the Partnership; or
8
(d) to terminate all the unpaid Capital Commitment of such defaulting
Limited Partner, in which event:
(i) the Partnership may make available to the General Partner
and/or the other Limited Partners the ability to assume part of all the
defaulting Limited Partner's unpaid Capital Commitment, in which event such
Partners shall pay for their respective additional Capital Commitments;
(ii) such defaulting Limited Partner shall have no further right to
make any Capital Contributions to the Partnership and such Limited
Partner's Partnership Percentage shall be reduced to zero; and
(iii) such defaulting Limited Partner's sole right thereafter shall be
to receive distributions from the Partnership, in accordance with Section
8.2, up to an amount equal to such Partner's Capital Account as of the date
of default, plus or minus such Partner's pro rata share of allocations
pursuant to Section 8.2 not yet made to such Partner's Capital Account as
of the date of default, if any, and less a charge, not in excess of 5% of
the amount to be distributed to the defaulting Limited Partner, to cover
reasonable expenses incurred in connection with such defaulting Limited
Partner's default, but in all other respects such defaulting Limited
Partner shall remain subject to all other terms and conditions of this
Agreement, including all liabilities hereunder, as if such Event of Default
had not occurred.
(e) The profits allocable to a defaulting Limited Partner will be equal to
50% of the profits (but 100% of the losses) otherwise allocable to such
defaulting Limited Partner under Section 8.2. The 50% of the profits not
allocated to a defaulting Limited Partner will be allocated among the remaining
Partners not then in default on the basis of their respective Capital
Contributions.
(f) Capital Accounts and Partnership Percentage shall be adjusted to
reflect the purchase, pursuant to Section 6.3(c), of any part of a defaulting
Limited Partner's interest in the Partnership by the remaining Partners and the
assumption of any unpaid Capital Commitment of such defaulting Limited Partner.
In the event some or all the remaining Partners assume part or all the unpaid
Capital Commitment of a defaulting Limited Partner pursuant to Section 6.3(c),
each non-defaulting Partner's Partnership Percentage shall be adjusted to
reflect such Partner's share of the total Capital Commitments of all non-
defaulting Partners.
9
ARTICLE 7
(S) 7.1 Fiscal Year and Accounting
The fiscal year of the Partnership shall be the calendar year and
the books of the Partnership shall be kept on a cash, accrual or such other
basis as the General Partner shall determine and shall be kept in
accordance with the accounting principles employed by the Partnership for
federal income tax purposes.
(S) 7.2 Capital Accounts
7.2.a A separate capital account shall be maintained for
each Partner to which his contributions and his allocable share of
income and gains shall be credited, and his distributions, and his
allocable share of deductions and losses shall be charged. The capital
accounts are intended to comply with Treasury Regulation (S) 1.704-
1(b) and shall be maintained and adjusted in a manner consistent with
such Regulation.
7.2.b A Partnership's Capital Account shall be increased
by the amount of Simulated Gains allocated to such Partnership, and
decreased by the amount of Simulated Depletion Deductions and
Simulated Losses allocated to such Partnership. Simulated Depletion
shall be allocated to the Partnership in the same proportion as such
Partners were properly allocated the adjusted tax basis of such
property. The aggregate Capital Account adjustments for simulated
percentage depletion allowances with respect to an oil and gas
property of the Partnership shall not exceed the aggregate adjusted
tax basis allocated to the Partnership with respect to such property.
The Capital Accounts of the Partners shall be adjusted upward by the
amount of any Simulated Gain in proportion to such Partner's allocable
shares of the portion of the total amount realized from the
disposition of such property that exceed the Partnership's simulated
adjusted basis in such property. The Capital Accounts of such Partners
shall be adjusted downward by the amount of any Simulated Loss in
proportion to such Partner's allocable shares of the total amount
realized from the disposition of such property that represents
recovery o the Partnership's simulated adjusted basis in such
property.
7.2.c Minium Gain Chargeback. Notwithstanding any other
provision of this Article, if there is a net decrease in Partnership
Minimum Gain, as defined in Temp.Reg. Section 1.704-1(b)(4)(iv)(c),
during any Partnership fiscal year each Partner shall be allocated
items of Partnership income and gain in accordance with
10
Temp.Reg. Section 1.704-1(b)(4)(iv)(e). This Section 7.2(c) is
intended to comply with the minimum gain chargeback requirement in
such Section of the Regulations and shall be interpreted consistently
therewith.
7.2.d Transfer of Interest. In the event any interest in
the Partnership is transferred in accordance with the terms of this
Agreement, the transferee shall succeed to the Capital Account of the
transferee to the extent it relates to the transferred interest.
(S) 7.3 Deduction of Intangible Drilling and Development Costs
The Partnership shall elect to deduct intangible drilling and
development costs currently as an expense for income tax purposes and shall
use its best efforts to require any partnership, joint venture or other
arrangement in which it is a party and which incurs such costs to make a
similar election.
(S) 7.4 Elections by Partnership as to Optional Adjustments to Basis
In case of a distribution of property within the provisions of
(S) 734 of the Code or in the case of a transfer of a Partnership interest
permitted by this Agreement made within the provisions of (S) 743 of the
Code, the General Partner, on behalf of the Partnership may, at its option,
file an election under (S) 754 of such Code in accordance with the
procedures set forth in the applicable Treasury Regulations. If such an
election is filed, the General Partner will at no time be required to
provide any additional accounting or tax information with respect to any
adjustment to basis for any Limited Partner.
(S) 7.5 Election with Respect to Taxation as Partnership
Neither the Partnership nor any Partner thereof will elect under
(S) 761 of the Internal Revenue Code of 1986 to be excluded from the
application of any of the provisions of Subchapter K, Chapter 1 thereof.
ARTICLE 8
(S) 8.1 Determination of Profit and Loss
At the end of each fiscal year of the Partnership or at the end
of such intervening accounting period as the General Partner may select,
all Partnership revenues, proceeds, costs and expenses shall be determined
and allocated to the Partnership interest of each Partner for the
accounting period then ending in accordance with the provisions of this
Article.
11
(S) 8.2 Allocation of Income, Gains, Losses, Deductions and Distributions
Income, Gains, Losses, Deductions and Distributions shall be
allocated among the Partners as follows:
Income, Gains, Losses, Deductions and Distributions shall be
allocated and distributed 1 percent to the General Partner and 99 percent
to the Limited Partners.
Notwithstanding anything contained herein to the contrary, no
distribution may be made to or loss allocated to a Limited Partner which
would render such Limited Partner a deficit Capital Account.
The Income, Gains, Losses, Deductions and Distributions that will
be allocated among the Partners are those items that are allocated and
distributed to the Partnership in accordance with the sharing ratio of the
Partnership in the Joint Venture Agreement. The sharing ratio will be based
on the various ventures, capital accounts. As indicated in the Joint
Venture Agreement, the sharing ratio of the Partnership will be reduced
once payout (as that term is defined in the Joint Venture Agreement) has
occurred, at which time EPC will receive its back-in interest, as more
fully described in the Joint Venture Agreement.
ARTICLE 9
(S) 9.1 Rights, Representations and Covenants of Limited Partners
9.1.a No Limited Partner shall be personally liable for any of the
debts of the Partnership or any of the losses thereof beyond the amount of
his agreed Capital Contribution. No Limited Partner shall be responsible
for any losses of any other Limited Partner. No Limited Partner shall take
part in the control or management of the business or transact any business
for the Partnership and no Limited Partner shall have the power to sign for
or to bind the Partnership. No salary shall be paid to any Limited Partner
nor shall any Limited Partner have a drawing account. No Limited Partner
shall be entitled to the return of his contribution.
9.1.b Each Limited Partner shall be personally obligated to make
payment of the amount he agreed to contribute to the Capital of the
Partnership upon execution of his Subscription Agreement to the
Partnership.
12
9.1.c In addition to other rights which a Limited Partner may
have, each Limited Partner has the right to bring a derivative action
against the General Partner in order to recover damages or otherwise
seek relief from the General Partner for a breach by the latter
of his fiduciary obligations to the Partnership.
(S) 9.2 Assignments by Limited Partner
9.2.a A Limited Partner may not sell, assign or transfer
his interest in the Limited Partnership to a successor Limited Partner
whether voluntarily or by operation of law unless the General Partner,
in his sole discretion, consents in writing to the sale, assignment or
transfer. Provided that such written consent is obtained, the
purchaser, assignee or transferee shall become a substitute Limited
Partner only if:
9.2.a.i the interest sold, assigned, or transferred
is not less than the total interest of the transferor Limited Partner
in the Partnership unless, in the opinion of the General Partner, the
Limited Partner has a sufficient interest to be divided; and
9.2.a.ii the purchaser, assignee or transferee shall
consent in writing, in form satisfactory to the General Partner, to be
bound by the terms of the Limited Partnership Agreement in the place
and stead of the assigning Limited Partner.
9.2.b A Limited Partner, without the consent of the
General Partner, may assign to any person all or any portion of his
right to receive distributions hereunder, provided, however, that such
assignment shall not be binding on the Partnership until the General
Partner shall have received a certified copy of such assignment.
9.2.c No sale or assignment of an interest in the
Partnership by a Limited Partner shall be effective until all
certificates or other documents have been performed which are
necessary to constitute the assignee a substitute Limited Partner in
the Limited Partnership in all jurisdictions in which it does business
and the General Partner approves the written assignment and said
assignment is recorded on the books of the Partnership. Each Limited
Partner agrees, upon request of the General Partner, to execute such
certificates or other documents and to perform such acts as may be
required to preserve such status and that Edge Petroleum Corporation,
the General Partner, may execute such certificates or other
13
instruments or documents on behalf of each Limited Partner pursuant to
the Power of Attorney granted by each Limited Partner to the General
Partner.
9.2.d Assignment, with or without the consent of the General
Partner, will not release the Limited Partner from his obligation to
pay his Capital Contribution.
(S) 9.3 Assignees
9.3.a In the event of the decease or incapacity of any
Limited Partner, his legal representative(s) shall have the same
status as an assignee of the Limited Partner unless and until the
General Partner shall permit such legal representative(s) to become a
Substitute Limited Partner on the terms and conditions as herein
provided. The death of a Limited Partner shall not dissolve the
Partnership.
9.3.b An assignee of a Limited Partner who does not become a
Substitute Limited Partner in accordance with (S) 9.2 shall, if such
assignment is in compliance with the terms of this Agreement, have the
right to receive the same share of profits, losses and distributions
of the Partnership to which the assigning Limited Partner would have
been entitled if no such assignment had been made by such Limited
Partner.
9.3.c Any Limited Partner who shall assign all his interest
in the Partnership shall cease to be a Limited Partner of the
Partnership, and shall no longer have any rights or privileges or
obligations if a Limited Partner is admitted to the Partnership as a
Substitute Limited Partner in accordance with (S) 9.2, provided,
however, that said assigning Limited Partner shall retain the
statutory rights and be subject to the statutory obligations of an
assignor Limited Partner under the Uniform Act as well as the
obligations to make the Capital Contributions attributable to the
interest in question, if any portion thereof remains unpaid.
9.3.d In the event of any assignment of a Limited Partner's
interest as a Limited Partner, there shall be filed with the
Partnership a duly executed and acknowledged counterpart of the
instrument making such assignment; such interest must evidence the
written acceptance of the assignee to all the terms and provisions of
this Agreement; and if such instrument is not so filed, the
Partnership need not recognize any such assignment for any purpose.
14
9.3.e An assignee of a Limited Partner's interest as a
Limited Partner who does not become a Substitute Limited Partner as
provided in (S) 9.2 and who desires to make a further assignment of
his interest shall be subject to the provisions of this Article 9 to
the same extent and in the same manner as any Limited Partner desiring
to make an assignment of his interest.
ARTICLE 10
(S) 10.1 Rights, Representations and Covenants of the General Partner
10.1.a The General Partner shall have full, exclusive and
complete discretion in the management and control of the affairs of
the Partnership for the purposes herein stated, shall make all
decisions affecting Partnership affairs and shall have full power and
authority to execute and deliver on behalf of the Partnership such
documents or instruments relating to Partnership affairs as may in his
opinion be appropriate in the conduct of Partnership business,
including, without limitation, joint venture agreements, operating
agreements, division orders, gas sales contracts, unitization
agreements, gasoline plan contracts, recycling agreements, production
payments, contracts, notes, mortgages and deeds of trust. No person,
firm or corporation dealing with the Partnership shall be required to
inquire into the authority of the General Partner to take any action
or make any decision.
10.1.b The General Partner shall devote such portion of his
time as is reasonably needed to carry out the operations contemplated
under this Agreement and shall make available at all reasonable times
his offices, organization, and facilities to carry out the purposes of
the Partnership.
10.1.c The General Partner shall, in addition to other duties,
maintain complete and accurate records and accounts of all income and
expenditures and furnish the Limited Partners with statements of
account from time to time, together with all necessary tax reporting
information. Such records and accounts shall likewise be available for
inspection and audit by any Limited Partner or his duly authorized
representative (at the expenses of such Limited Partner) during
business hours at one of the executive offices of the Partnership;
however, the General Partner shall not be required to maintain such
records and material referred to herein for a period in excess of five
(5) years from the date of the making or receipt thereof.
15
10.1.d The Partnership, to the extent of its assets, will
indemnify the General Partner and, in the sole discretion of the
General Partners, their agents, employees, advisors and consultants,
against any loss or liability and against tort or contract liability
resulting from good faith acts or omissions to act on its part on
behalf of the Partnership and, in any event, to the extent permissible
under the laws of the State of Texas. The General Partner shall not
have any liability for any failure or misfeasance on his part, other
than a willful failure or misfeasance with respect to his obligations
under the Agreement.
10.1.e Whenever a conflict of interest exists or arises
between the General Partner, on the one hand, and the Partnership or
the Limited Partner, on the other hand, or the General Partner shall
resolve such conflict of interest, take such action or provide such
terms considering, in each case, the relative interests of each party
to such conflict, agreement, transaction or situation and the benefits
and burdens relating to such interest, any customary or accepted
industry practices, and any applicable generally accepted accounting
or engineering practices or principles, and in the absence of bad
faith by the Managing General Partner, the resolution, action or terms
so made, taken or provided by the General Partner shall not constitute
a breach of this Agreement, or any other agreement contemplated herein
or therein or a breach of any standard of care or duty imposed herein
or therein or under Texas law or any other applicable law, rule or
regulation.
(S) 10.2 Assignment by General Partner
The General Partner shall not sell, assign or otherwise dispose
of all or any portion of his interest in the Partnership as General Partner
without prior Consent of the Partners; provided, however, such consent
shall not be required, if such sale or assignment relates only to the
General Partner's right to receive distributions hereunder or is required
by another provision of this Agreement.
(S) 10.3 Fees and Reimbursement to General Partner
The Partnership shall reimburse the General Partner for all
reasonable expenses and costs incurred in connection with the business of
the Partnership.
16
ARTICLE 11
(S) 11.1 General Partner's Withdrawal from the Partnership
The General Partner may not withdraw as General Partner from
the Partnership without prior Consent of the Partners.
ARTICLE 12
(S) 12.1 Termination and Dissolution of the Partnership
The Partnership shall be dissolved on December 31, 2020, or upon
-----------------
the prior occurrence of any event causing a dissolution of the Partnership
under the Texas Revised Limited Partnership Act. The Partnership shall also
be dissolved upon (a) the occurrence of any event which makes it unlawful
for the Partnership business to be continued, unless such event can be and
is remedied within a reasonable period of time not to exceed six (6)
months; (b) the sale or other disposition of substantially all interests in
oil and gas acreage and leases and other Partnership assets; or (c) the
bankruptcy of a General Partner, unless a surviving General Partner elects
to continue as General Partner.
The Partnership shall not be dissolved by reason of the death,
withdrawal or expulsion of a Limited Partner or upon the admission of a new
Limited Partner.
(S) 12.2 Winding Up and Distribution
In the event of the dissolution of the Partnership, the General
Partner shall wind up the affairs of the Partnership and, after payment of
all third-party liabilities of the Partnership, shall distribute the
remaining assets of the Partnership in cash or in kind in accordance with
their respective Capital Account balances.
12.2.a Distribution to the Limited Partners
hereunder shall be allocated to each Limited Partner in the
proportion that his capital account bears to the capital account
for all Limited Partners.
12.2.b Any property distributed in kind in
liquidation shall be treated as if the property were sold for its
fair market value and any deemed gain or loss shall be credited
to the Partners in accord with this Agreement.
12.2.c If there should be a deficit in any Partner's
capital account, the Partner shall be required to make a Capital
Contribution equal to the deficit
17
amount. Such contribution shall be made not later than the end of the
Partnership year in which such Partners' interest is liquidated, or,
if later, within 90 days of the date of such liquidation.
12.2.d Notwithstanding anything contained herein to the
contrary, if on liquidation the respective Partners' Capital Accounts
do not reflect the allocations as provided in Section 8.2, then the
Capital Accounts, to the extent necessary, shall be reallocated to
reflect such allocations.
ARTICLE 13
(S) 13.1 Independent Activities
All Partners may, notwithstanding the existence of this
Agreement, engage in whatever activities they choose, whether the same be
competitive with the Partnership or otherwise, without having or incurring
any obligations to offer any interest in such activities to any party
hereto. Neither this Agreement nor any activity undertaken pursuant hereto
shall prevent the General Partner from engaging as they intend to do in the
exploration for and production of oil, gas and other minerals,
individually, jointly with others, or as a party of any other association
to which the General Partner is or may become a party, except to the extent
provided herein.
ARTICLE 14
(S) 14.1 Notices
Any and all notices called for under this Agreement shall be
deemed adequately given, as and when postmarked, if in writing and sent
registered or certified mail, postage prepaid, to the party or parties for
whom such notices are intended. All such notices in order to be effective
shall be addressed to the last address of record on the partnership books
when given by the General Partner and intended for the Limited Partners;
and, to the address of the Partnership when given by the Limited Partners
and intended for the General Partner. Any Limited Partner may change his
address by giving notice, in writing, to the General Partner and the
General Partner may change the address of the Partnership by giving such
notice to all Limited Partners. Commencing on the fifth day after giving of
such notice, such newly designated address shall be such Partner's address
for the purpose of all notices or other communications required or
permitted to be given pursuant to this Agreement.
18
(S) 14.2 Law Governing
This Agreement shall be governed by and construed in accordance
with the laws of the State of Texas.
(S) 14.3 Amendments
The General Partner may propose in writing to the Limited
Partners the adoption of an amendment to this Agreement, and, if within
sixty (60) days of the sending of such proposal, the consent of the
Partners shall have been given, the amendment shall be deemed adopted,
except that all Partners must give their consent in writing to any
amendment which would (i) extend the term of the Partnership as set forth
in Section 4.2 hereof, (ii) amend Sections 8.2 or 12.2, (iii) amend this
Section 14.3 or (iv) in any manner increase the liability of the Limited
Partners.
(S) 14.4 Successors and Assigns
This Agreement and all the terms and provisions hereof shall be
binding upon and shall enure to the benefit of the Partners, their
respective legal representatives, heirs, successors and assigns.
(S) 14.5 Counterparts
This Agreement may be executed in several counterparts and all so
executed shall constitute one agreement binding on all parties hereto,
notwithstanding that all the parties have not signed the original or the
same counterpart, except that no counterpart shall be binding unless signed
by the General Partner.
Individuals Entities
Caddo Investors, Ltd.
___________________________________ ----------------------------------------
Investor Limited Partner Name of Entity
/s/ Xxxxxxxxxxx X. Xxxxxx
___________________________________ By: ------------------------------------
Social Security Number Signature and Title
Managing Partner
___________________________________
Residence Address
___________________________________
City State Zip Code
19
$ 387,000
------------------------
Total Capital Commitment
$ 60,000
------------------------
Amount Due on or before
July 1, 1992
Individual Investors Entity Investors
Caddo Investors, Ltd.
_________________________________ --------------------------------------
Signature of Investor No.1 Name of Corporation, Partnership,
Trust, Plan or Entity
_________________________________
Name (Typed or Printed)
By: /s/ Xxxxxxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxxxxxx X. Xxxxxx
Title: Managing Partner
_________________________________
Signature of Investor No.2
(if any)
[INDIVIDUAL]
STATE OF ____________________)
: SS.:
COUNTY OF ___________________)
On _______________, 1991, before me personally appeared
_________________, known to me as the person(s) whose name(s) is subscribed to
the foregoing Agreement of Limited Partnership and acknowledged that he/she/they
executed the same.
_______________________________
Notary Public
20
[CORPORATE]
STATE OF _____________________)
: ss.:
COUNTY OF ____________________)
On ____________________, 1991, before me personally appeared
_________________________, to me known and who, being by me duly sworn, did
depose and say that s/he is the _____________________ of __________________, a
____________________ corporation, the corporation which executed the foregoing
Limited Partnership Agreement, that s/he knows the seal of said corporation;
that the seal affixed to said Agreement is such corporate seal; that it was so
affixed by authority of the corporation; and that s/he signed his/her name
thereto by like authority.
___________________________________
Notary Public
[PARTNERSHIP]
STATE OF Louisiana )
---------------------
: ss.: 00-0000000
PARISH OF Caddo )
---------------------
On 5th April, 1991, before me personally appeared Xxxxxxxxxxx X.
--------- --------------
Xxxxxx, to me known and who, being by me duly sworn, did depose and say that
------
s/he is a General Partner of Caddo Investors Ltd., a Louisiana partnership, the
--------------- ---------
partnership which executed the foregoing Limited Partnership Agreement, that
s/he being authorized to do so, did execute it on the partnership's behalf.
/s/ Xxxxxxx Xxxxxx Xxxx
-----------------------------------
Notary Public
XXXXXXX XXXXXX XXXX, Notary Public
Caddo Parish, Louisiana
My Commission is for Life
21
[TRUST]
STATE OF ________________________)
: SS.:
COUNTY OF _______________________)
On ___________________, 1991, before me personally appeared
_______________________, to me known and who, being by me duly sworn, did depose
and say that s/he is a trustee of ____________, a trust, that the trust executed
the foregoing Limited Partnership Agreement, that s/he being authorized to do
so, did execute it on the trust's behalf.
_________________________
Notary Public
22
