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EXHIBIT 10.1.2
AMENDMENT NO. 1
TO THE
AGREEMENT OF LIMITED PARTNERSHIP
OF
TITAN RESOURCES, L.P.
THIS AMENDMENT NO. 1 TO THE AGREEMENT OF LIMITED PARTNERSHIP OF TITAN
RESOURCES, L.P. (this "Amendment"), dated as of December 11, 1995, is made by
and among Titan Resources I, Inc., a Texas corporation, as the general partner
(the "General Partner"), and a Majority Interest of the Limited Partners.
W I T N E S S E T H :
WHEREAS, the General Partner and the Limited Partners are the parties to
that certain Agreement of Limited Partnership dated as of March 31, 1995 (the
"Partnership Agreement"), providing for the formation and operation of Titan
Resources, L.P., a Texas limited partnership (the "Partnership"); and
WHEREAS, the parties hereto desire to enter into this Amendment in order
to amend the Partnership Agreement in certain respects so as to admit certain
persons as Limited Partners of the Partnership and to make certain other
amendments to the Partnership Agreement in connection therewith;
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and agreements contained herein and in the Partnership Agreement and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the General Partner and a Majority Interest of the Limited
Partners (acting on behalf of all of the Limited Partners) hereby agree as
follows:
1. Certain Definitions. Terms used in this Amendment and not
otherwise defined shall have the meanings set forth in the Partnership
Agreement.
2. Issuances of Additional Securities. Section 3.2(a) of the
Partnership Agreement is hereby amended to read in its entirety as follows:
(a) The General Partner is hereby authorized to cause the
Partnership to issue, in addition to the Units issued at the time of the
formation of the Partnership, such additional Units, or classes or
series thereof, or options, rights, warrants or appreciation rights
relating thereto, or any other type of equity security that the
Partnership may lawfully issue ("Partnership Equity Securities"), any
debt obligations of the Partnership convertible into any class or series
of equity securities of the Partnership ("Partnership Debt Securities")
(collectively, "Partnership Securities"), upon compliance with this
Section 3.2. The General Partner may cause the Partnership to issue
such Partnership
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Securities at any time and from time to time if (i) the Partnership
shall have a need for additional Capital Contributions for any proper
Partnership purpose and (ii) the General Partner shall provide each
existing Limited Partner with the right to acquire such newly-issued
Partnership Securities so that such Limited Partner may retain its
Sharing Ratio at the time immediately prior to the issuance of such
Partnership Securities. Notwithstanding the immediately preceding
sentence, the General Partner may waive the requirements thereof in the
event that (x) a Majority Interest of the Limited Partners consent to
waive the requirements of subsection (ii) of such sentence prior to the
issuance of any such Partnership Securities in the event that such
Partnership Securities are to be issued for cash, and such waiver shall
pertain to all Partners and not purport to waive such preemptive right
of any particular Partner or class of Partners or any Partner to which
the Partnership has granted a preemptive right in a separate agreement,
(y) the General Partner issues options to acquire Partnership Securities
to employees of the Partnership or employees of the General Partner
engaged primarily in the business and affairs of the Partnership
pursuant to the incentive option plan adopted by the Partnership on
March 31, 1995 or (z) the General Partner shall issue such Partnership
Securities for consideration other than for cash. Subject to the
immediately preceding sentences, the General Partner may issue such
Partnership Securities to such persons for such consideration and on
such terms and conditions as shall be established by the General Partner
in its sole discretion. The General Partner shall have sole discretion,
subject to the guidelines set forth in this Section 3.2 and the
requirements of the Act, in determining the consideration and terms and
conditions with respect to any future issuance of Partnership
Securities.
3. Distributions. Section 4.5 of the Partnership Agreement is
hereby amended in its entirety to read as follows:
SECTION 4.5. Distributions. The General Partner may distribute
funds of the Partnership which the General Partner reasonably determines
are not needed for the payment of existing or foreseeable Partnership
obligations and expenditures to the Partners at such times and in such
amounts as the General Partner, in its sole discretion, determines to be
appropriate. Subject to the next sentence of this Section 4.5 and
applicable law, the General Partner shall distribute to each Partner
within 90 days after the end of each year an amount equal to the highest
marginal federal income tax rate for ordinary income or capital gains
income to individuals, as applicable, multiplied by the estimated amount
of all Partnership ordinary income (net of ordinary deductions,
including for this purpose, each Partner's actual depletion deductions)
and capital gains (net of all capital losses and taking into account
such Partner's actual gains or losses from sales or dispositions of oil
and gas properties), as applicable, actually allocated, charged or
credited to such Partner for such year taking into account any items of
income, gain, loss or deduction specially allocated to such Partner
under Section 704(c) of the Internal Revenue Code or under Section
704(c) principles, as required under applicable Treasury Regulations.
Notwithstanding the immediately preceding sentence, (a) at any time
prior to the termination of Section 1 of the Amended and Restated Voting
and Shareholders Agreement among the General Partner, Xxxx X. Xxxxxxxxx,
Natural Gas Partners, L.P.,
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Natural Gas Partners II, L.P., Joint Energy Development Investments
Limited Partnership and First Union Corporation dated even date with
this Agreement (the "Voting and Shareholders Agreement"), those Limited
Partners whose combined Sharing Ratios exceed 85% of the Sharing Ratios
of all Limited Partners may waive the requirement of the immediately
preceding sentence, and (b) at any time subsequent to the termination of
Section 1 of the Voting and Shareholders Agreement, a Majority Interest
of the Limited Partners may waive the requirement of the immediately
preceding sentence. All such distributions shall be made to the
Partners 1% to the General Partner and 99% to the Limited Partners.
4. Admission of Additional Partners. A new Section 4.6 is hereby
added into the Partnership Agreement to read in its entirety as follows:
SECTION 4.6. Admission of a New Partner. For federal income tax
purposes, the allocation of costs, revenue, income, gains, losses,
deductions, credits and items of tax preference of the Partnership,
including depletion and depreciation, during the calendar year in which
a new Partner is admitted to the Partnership shall be allocated among
the Partners on the basis of the interim closing of the books method in
accordance with Section 706(d) of the Internal Revenue Code.
5. Indemnification. The Partners hereby agree that the term
"Indemnitee" as used in Section 5.4 of the Partnership Agreement shall include
persons who are duly elected or appointed advisory directors of the General
Partner.
6. Section 754 Elections. The following provision is hereby added
to the end of Section 5.8 of the Partnership to read as follows:
;provided, however, that the Partnership shall make an election to
adjust the basis of properties of the Partnership on the appropriate tax
returns of the Partnership, pursuant to Section 754 of the Internal
Revenue Code, upon the written request of any Partner after a
distribution of property of the Partnership, as described in Section 734
of the Internal Revenue Code, or after there shall be a transfer of a
Partnership interest as described in Section 743 of the Internal Revenue
Code.
7. Assignment of Interests.
(a) Section 9.1(a) of the Partnership Agreement is hereby amended to
read in its entirety as follows:
(a) No Partner's interest in the Partnership or rights therein
shall be assigned, mortgaged, pledged, subjected to a security interest
or otherwise encumbered, in whole or in part, without the prior written
consent of the General Partner and (i) if the assignor is the General
Partner, without the additional consent of Limited Partners whose
combined Sharing Ratios exceed 75% of the Sharing Ratios of all Limited
Partners, (ii) if the
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assignor is either of Natural Gas Partners, L.P., a Delaware limited
partnership, or Natural Gas Partners II, L.P., a Delaware limited
partnership (collectively, "NGP"), without the additional consent of
Xxxxxxxxx (or his permitted successors or assigns), or (iii) if the
assignor is Xxxxxxxxx, without the additional consent of NGP (or their
respective permitted successors or assigns). Notwithstanding the
immediately preceding sentence (1) NGP shall have the right to assign
their respective interests to their respective partners without such
consent, and (2) the Partnership may provide in a separate agreement
with any Limited Partner that such Limited Partner may assign, mortgage,
pledge, subject to a security interest or otherwise encumber, in whole
or in part, such Limited Partner's interest in the Partnership without
obtaining such consent. Any attempt by a Partner to assign its interest
without the required consent (to the extent necessary) shall be void ab
initio.
(b) Section 9.1(c) of the Partnership Agreement is hereby amended to
read in its entirety as follows:
(c) An assignee of an interest in the Partnership shall become
a substituted Partner entitled to all of the rights of a Partner if, and
only if, (i) the assignor gives the assignee such right, (ii) the
General Partner (if the assignee is the assignee of a Limited Partner),
Limited Partners whose combined Sharing Ratios exceed 75% of the Sharing
Ratios of all Limited Partners (if the assignee is the assignee of the
General Partner), the General Partner and Xxxxxxxxx or his permitted
successors or assigns (if the assignee is the assignee of NGP), or the
General Partner and NGP or their permitted successors or assigns (if the
assignee is the assignee of Xxxxxxxxx) consent in writing to such
substitution, the granting or denying of which shall be in such
Partners' sole discretion, (iii) the assignee executes and delivers such
instruments, in form and substance satisfactory to the requisite
Partners that must consent to such substitution pursuant to clause (ii)
above as such requisite Partners (as applicable) may deem necessary or
desirable to effect such substitution and to confirm the agreement of
the assignee to be bound by all of the terms and provisions of this
Agreement, and (iv) if the General Partner so requires, the assignee
reimburses the Partnership for any costs incurred by the Partnership in
connection with such assignment and substitution. Upon the satisfaction
of such requirements, such assignee shall be admitted as of such date as
shall be provided for in any document evidencing such assignment as a
substituted Partner of the Partnership. Notwithstanding the immediately
preceding sentence, the Partnership (acting through the General Partner,
the board of directors of which must have approved such agreement in
accordance with the provisions of its bylaws) may provide in a separate
agreement with any Limited Partner that such Limited Partner need not
comply with all of such requirements prior to allowing the assignee of
such Limited Partner to become a substituted Limited Partner.
8. Representations of Partners. Section 10.1(l) of the Partnership
Agreement is hereby amended to read in its entirety as follows:
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(l) Such Limited Partner further covenants and agrees that (A)
its Partnership Interest will not be resold unless the provisions set
forth in Article IX above are complied with, and (B) such Limited
Partner shall have no right to require registration of its Partnership
Interest under the Securities Act or applicable state securities laws
other than pursuant to an agreement executed between the Limited Partner
and the Partnership.
9. Amendment to Schedule 1. Pursuant to Section 3.2 of the
Partnership Agreement, the General Partner hereby amends Schedule 1 to the
Partnership Agreement in order to reflect the admission of additional Limited
Partners to the Partnership, effective at such time as such additional Limited
Partners shall deliver a counterpart signature page to the Partnership
Agreement in the form attached to this Amendment, which amended Schedule 1 is
attached to this Amendment.
10. Power and Authority to Enter into Amendment. Pursuant to Section
11.2 of the Partnership Agreement, a Majority Interest of the Limited Partner
hereby executes this Amendment in order to consent to the amendments set forth
herein.
11. Ratification of Partnership Agreement. The Partnership
Agreement, as amended by this Amendment, is hereby ratified and confirmed in
all respects.
12. Counterparts. This Amendment may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the day and year first above written.
GENERAL PARTNER:
TITAN RESOURCES I, INC.
By: /s/ XXXX X. XXXXXXXXX
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Xxxx X. Xxxxxxxxx, President
LIMITED PARTNERS:
NATURAL GAS PARTNERS, L.P.
By: G.F.W. Energy, L.P., its general
partner
By: /s/ XXXXX X. XXXXX
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Xxxxx X. Xxxxx, Authorized Employee
NATURAL GAS PARTNERS II, L.P.
By: G.F.W. Energy II, L.P., its general
partner
By: GFW II, L.L.C., its general partner
By: /s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx
/s/ XXXX X. XXXXXXXXX
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Xxxx X. Xxxxxxxxx
/s/ XXXX X. XXXXXXXXX
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Xxxx X. Xxxxxxxxx, Separate Property
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LIMITED PARTNER SIGNATURE PAGE (ENTITY)
The undersigned, desiring to become a Limited Partner of the
Partnership, hereby agrees to all of the terms and provisions of the Agreement
of Limited Partnership, and agrees to be bound by the terms and provisions of
this Limited Partner Signature Page which, together with other Limited Partner
Signature Pages, is hereby incorporated into the said Agreement of Limited
Partnership. The undersigned hereby joins and executes the said Agreement of
Limited Partnership, hereby authorizing this Limited Partner Signature Page to
be attached thereto. The place of residence or principal business address of
the undersigned is as shown below.
IN WITNESS WHEREOF, the undersigned has executed this Limited Partner
Signature Page to the Agreement of Limited Partnership as of the date set forth
hereinafter.
Date: December __, 1995 ENTITY LIMITED PARTNER:
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1.
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(Name of Entity Printed)
2.
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(Name of General Partner or Trustee of
Entity, if applicable)
3.
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(Signature of Officer or Trustee)
4.
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(Name of Officer Printed)
5.
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(Title of Officer)
