AMENDMENT NO. 1 TO THE FIRST AMENDED AND
RESTATED
AGREEMENT OF LIMITED PARTNERSHIP OF
HOLLY ENERGY PARTNERS, L.P.
THIS AMENDMENT NO.
1 TO THE FIRST AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF HOLLY ENERGY PARTNERS, L.P. (this
“Amendment”), dated as of February 28, 2005, is
entered into and effectuated by HEP Logistics Holdings, L.P., a
Delaware limited partnership, as the General Partner, pursuant to
authority granted to it in Section 5.6 of the First Amended
and Restated Agreement of Limited Partnership of Holly Energy
Partners, L.P., dated as of July 13, 2004, as amended (the
“Partnership Agreement”). Capitalized terms used but
not defined herein are used as defined in the Partnership
Agreement.
WHEREAS,
Section 5.6 of the Partnership Agreement provides that the
General Partner, without the approval of any Limited Partners, may
issue additional Partnership Securities, or classes or series
thereof, for any Partnership purpose at any time and from time to
time, and 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; and
WHEREAS,
Section 13.1(g) of the Partnership Agreement provides that the
General Partner, without the approval of any Partner (subject to
the terms of Section 5.7 of the Partnership Agreement), may
amend any provision of the Partnership Agreement necessary or
appropriate in connection with the authorization of issuance of any
class or series of Partnership Securities pursuant to
Section 5.6 of the Partnership Agreement; and
WHEREAS, the
General Partner has determined that the issuance of the
Class B Subordinated Units provided for in this Amendment is
permitted by Section 5.7 of the Partnership Agreement;
and
WHEREAS,
Section 13.1(d)(i) of the Partnership Agreement provides that
the General Partner, without the approval of any Limited Partner,
may amend any provision of the Partnership Agreement to reflect a
change that the General Partner determines does not adversely
affect the Limited Partners (including any particular class of
Partnership Interests as compared to other classes of Partnership
Interests) in any material respect; and
WHEREAS, the
Partnership has entered into (i) a Contribution Agreement,
dated as of January 25, 2005 (the “Alon Contribution
Agreement”), with Alon Pipeline Logistics, LLC, a Delaware
limited liability company (“Alon Pipeline Logistics”),
and Alon USA, LP, a Texas limited partnership (“Alon”),
and certain other parties named therein, and (ii) a Pipelines
and Terminals Agreement, dated as of February 28, 2005 (the
“Alon Pipelines Agreement”), with Alon; and
WHEREAS, the
Contribution Agreement obligates the Partnership to issue limited
partner interests to be designated as Class B Subordinated
Units having the terms set forth herein; and
Amendment No. 1 to
Partnership Agreement_ Exhibit 3.1 to Form 8-K (HEP_UBS
Transactions).DOC
Amendment No. 1 to
First Amended and Restated
Agreement of Limited
Partnership of
Holly
Energy Partners, L.P.
WHEREAS, the
General Partner deems it in the best interest of the Partnership to
effect this Amendment in order to provide for (i) the issuance
of Class B Subordinated Units to Alon Pipeline Logistics
pursuant to the Contribution Agreement and (ii) such other
matters as are provided herein.
NOW, THEREFORE, it
is hereby agreed as follows:
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A.
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Amendment . The Partnership Agreement is
hereby amended as follows:
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1.
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Section 1.1 is hereby amended
to add the following definitions:
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“
Alon ” means Alon USA, LP, a Texas limited
partnership, and its successors and assigns.
“ALON Event of Default” means an ALON Event of
Default specified in Section 16(b)(i) of the Alon Pipelines
Agreement in respect of payments due pursuant to the Minimum Volume
Commitment which default has not been cured within the time
specified in Section 17(a) of the Alon Pipelines
Agreement.
“Alon
Pipeline Logistics” means Alon Pipeline Logistics, LLC, a
Delaware limited liability company.
“Alon Potential Event of Default” means a
default in respect of payments due pursuant to the Minimum Volume
Commitment which would become an Alon Event of Default on the
expiration of the time period specified in Section 17(a) of the
Alon Pipelines Agreement.
“ Alon
Pipelines Agreement ” means the Pipelines and Terminals
Agreement, dated as of February 28, 2005, between the Partnership
and Alon.
“
Class B Subordinated Unit ” means a Unit
representing a fractional part of the Partnership Interests of all
Limited Partners and Assignees and having the rights and
obligations specified with respect to the Class B Subordinated
Units in this Agreement. The term “Class B Subordinated
Unit” as used herein does not include a Common Unit,
Subordinated Unit or Parity Unit. A Class B Subordinated Unit
that is convertible into a Common Unit or a Parity Unit shall not
constitute a Common Unit or Parity Unit until such conversion
occurs.
“
Class B Subordination Period ” means the period
commencing on February 28, 2005 and ending on the first to
occur of the following dates:
(a) the first
day of any Quarter beginning after March 31, 2010 in respect
of which no ALON Event of Default existed with respect to each of
the three consecutive, non-overlapping four-Quarter periods
immediately preceding such date; provided , however ,
that if an Alon Potential Event of Default exists on such date, but
is cured prior to its becoming an Alon Event of Default, the
Class B Subordination Period shall end on the first Business
Day after such cure; and
Amendment No. 1
to First Amended and Restated
Agreement of Limited
Partnership of
Holly Energy Partners,
L.P.
2
(b) the date
on which the General Partner is removed as general partner of the
Partnership upon the requisite vote by holders of Outstanding Units
under the circumstances where Cause does not exist and Units held
by the General Partner and its Affiliates are not voted in favor of
such removal.
“ Minimum
Volume Commitment ” has the meaning set forth in the Alon
Pipelines Agreement.
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2.
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Section 1.1 is hereby amended
by amending and restating the final sentence to the definition of
“Common Unit”:
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The
term “Common Unit” does not refer to a Subordinated
Unit or a Class B Subordinated Unit prior to its conversion
into a Common Unit pursuant to the terms hereof.
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3.
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Section 1.1 is hereby amended
by amending and restating the following definitions:
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“ Common
Unit Arrearage ” means, with respect to any Common Unit,
whenever issued, as to any Quarter within the Subordination Period
or the Class B Subordination Period, the excess, if any, of
(a) the Minimum Quarterly Distribution with respect to a
Common Unit in respect of such Quarter over (b) the sum of all
Available Cash distributed with respect to a Common Unit in respect
of such Quarter pursuant to Section 6.4(a)(i).
“
Cumulative Common Unit Arrearage ” means, with respect
to any Common Unit, whenever issued, and as of the end of any
Quarter, the excess, if any, of (a) the sum resulting from
adding together the Common Unit Arrearage as to an Initial Common
Unit for each of the Quarters within the Subordination Period or
the Class B Subordination Period ending on or before the last
day of such Quarter over (b) the sum of any distributions
theretofore made pursuant to Section 6.4(a)(ii) and the second
sentence of Section 6.5 with respect to an Initial Common Unit
(including any distributions to be made in respect of the last of
such Quarters).
“ Limited
Partner Interest ” means the ownership interest of a
Limited Partner or Assignee in the Partnership, which may be
evidenced by Common Units, Subordinated Units, Class B
Subordinated Units, Incentive Distribution Rights or other
Partnership Securities or a combination thereof or interest
therein, and includes any and all benefits to which such Limited
Partner or Assignee is entitled as provided in this Agreement,
together with all obligations of such Limited Partner or Assignee
to comply with the terms and provisions of this Agreement;
provided , however , that when the term
“Limited Partner Interest” is used herein in the
context of any vote or other approval, including without limitation
Articles XIII and XIV, such term shall not, solely for such
purpose, include any holder of an Incentive Distribution Right
except as may otherwise be required by law.
“
Partnership Security ” means any class or series of
equity interest in the Partnership (but excluding any options,
rights, warrants and appreciation rights relating to an equity
interest in the Partnership), including without limitation, Common
Units, Subordinated Units, Class B Subordinated Units and
Incentive Distribution Rights.
Amendment No. 1
to First Amended and Restated
Agreement of Limited
Partnership of
Holly Energy Partners,
L.P.
3
“
Remaining Net Positive Adjustments ” means as of the
end of any taxable period, (i) with respect to the Unitholders
holding Common Units, Subordinated Units or Class B
Subordinated Units, the excess of (a) the Net Positive
Adjustments of the Unitholders holding Common Units, Subordinated
Units or Class B Subordinated Units as of the end of such
period over (b) the sum of those Partners’ Share of
Additional Book Basis Derivative Items for each prior taxable
period, (ii) with respect to the General Partner (as holder of the
General Partner Interest), the excess of (a) the Net Positive
Adjustments of the General Partner as of the end of such period
over (b) the sum of the General Partner’s Share of
Additional Book Basis Derivative Items with respect to the General
Partner Interest for each prior taxable period, and (iii) with
respect to the holders of Incentive Distribution Rights, the excess
of (a) the Net Positive Adjustments of the holders of
Incentive Distribution Rights as of the end of such period over
(b) the sum of the Share of Additional Book Basis Derivative
Items of the holders of the Incentive Distribution Rights for each
prior taxable period.
“ Share
of Additional Book Basis Derivative Items ” means in
connection with any allocation of Additional Book Basis Derivative
Items for any taxable period, (i) with respect to the
Unitholders holding Common Units, Subordinated Units or
Class B Subordinated Units, the amount that bears the same
ratio to such Additional Book Basis Derivative Items as the
Unitholders’ Remaining Net Positive Adjustments as
