to
Amended and Restated Agreement of
Limited Partnership
of Williams Partners
L.P.
This Amendment
No. 3, dated December 13, 2006 (this “
Amendment ”), to the Amended and Restated Agreement of
Limited Partnership, dated as of August 23, 2005, as amended
(the “ Partnership Agreement ”), of Williams
Partners L.P., a Delaware limited partnership (the “
Partnership ”), is entered into and effectuated by
Williams Partners GP LLC, a Delaware limited liability company, as
the General Partner, pursuant to authority granted to it in Article
XIII of the Partnership Agreement. Capitalized terms used but not
defined herein are used as defined in the Partnership
Agreement.
WHEREAS,
Section 5.6(a) of the Partnership Agreement provides that the
Partnership may issue additional Partnership Securities for any
Partnership purpose at any time and from time to time to such
Persons for such consideration and on such terms and conditions as
the General Partner shall determine, all without the approval of
any Limited Partners;
WHEREAS,
Section 5.6(b) of the Partnership Agreement provides that the
additional Partnership Securities authorized to be issued by the
Partnership pursuant to such Section 5.6(a) of the Partnership
Agreement may be issued in one or more classes, or one or more
series of any such classes, with such designations, preferences,
rights, powers and duties (which may be senior to existing classes
and series of Partnership Securities), as shall be fixed by the
General Partner;
WHEREAS,
Section 13.1(g) of the Partnership Agreement provides that the
General Partner, without the approval of any Partner, may amend any
provision of the Partnership Agreement to reflect an amendment that
the General Partner determines to be 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;
WHEREAS,
Section 13.1(d)(i) of the Partnership Agreement provides that
the General Partner, without the approval of any 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 Board
of Directors of the General Partner (the “ Board
”) deems it in the best interest of the Partnership to effect
this Amendment to provide for (i) the issuance of the
Privately Placed Class B Units (as defined herein) and
Privately Placed Common Units (as defined herein) to certain
qualified institutional buyers and possibly certain accredited
investors pursuant to a Unit Purchase Agreement, dated
December 1, 2006, (ii) the issuance of Sponsor
Class B Units (as defined herein) to the General Partner
pursuant to a Purchase and Sale Agreement, dated November 16,
2006, (iii) the conversion of the Privately Placed
Class B Units
and Sponsor
Class B Units into Common Units in accordance with the terms
described herein, and (iv) such other matters as are provided
herein.
NOW, THEREFORE, it
is hereby agreed that the Partnership Agreement is hereby amended
as follows:
1. Section 1.1
of the Partnership Agreement is hereby amended to add or amend and
restate the following definitions:
“
Class B Distribution Increase Date ” has the
meaning assigned to such term in Section 5.11(g).
“
Class B Unit ” means a Partnership Security
representing a fractional part of the Partnership Interests of all
Limited Partners, and having the rights and obligations specified
with respect to Class B Units in this Agreement. The term
“ Class B Unit ” as used herein does not
include a Common Unit, Subordinated Unit or Parity Unit. A
Class B Unit that is convertible into a Common Unit shall not
constitute a Common Unit until such conversion occurs. The term
“ Class B Unit ” includes the Privately
Placed Class B Units and the Sponsor Class B
Units.
“
Class B Unit Arrearage ” means, with respect to
any Class B Unit, whenever used, as to any Quarter, the amount
if any, by which (a) the Minimum Quarterly Distribution in
respect of such Quarter (or, for the period from the Class B
Distribution Increase Date through the Conversion Effective Date,
115% of the Minimum Quarterly Distribution) exceeds (b) the
sum of all Available Cash distributed with respect to a
Class B Unit in respect of such Quarter pursuant to
Section 5.11(b)(ii)(B)(x).
“
Class B Unit Value ” means with respect to the
Privately Placed Class B Units and the Sponsor Class B
Units, $38.00 per unit.
“
Conversion Approval ” has the meaning assigned to such
term in Section 5.11(f).
“
Conversion Approval Date ” has the meaning assigned to
such term in Section 5.11(f).
“
Conversion Effective Date ” has the meaning assigned
to such term in Section 5.11(h).
“
Cumulative Class B Unit Arrearage ” means, with
respect to any Class B Unit, whenever used, as of the end of
any Quarter, the excess, if any, by which (a) the sum
resulting from adding together the Class B Unit Arrearage for
each of the Quarters during which any Class B Unit has been
Outstanding exceeds (b) the sum of any distributions
theretofore made to a Class B Unit pursuant to
Section 5.11(b)(ii)(B)(x)(2) and the
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penultimate
sentence of Section 6.5 (including any distributions to be
made in respect of the last of such Quarters).
“Excess
Payment” has the meaning assigned to such term in Section
5.11(b)(vi)(B) (as set forth in Section 5.11(g)).
“Initial
Unit Price” means (a) with respect to the Common
Units, the Class B Units and the Subordinated Units, the
initial public offering price per Common Unit at which the
Underwriters offered the Common Units to the public for sale as set
forth on the cover page of the prospectus included as part of the
Registration Statement and first issued at or after the time the
Registration Statement first became effective or (b) with
respect to any other class or series of Units, the price per Unit
at which such class or series of Units is initially sold by the
Partnership, as determined by the General Partner, in each case
adjusted as the General Partner determines to be appropriate to
give effect to any distribution, subdivision or combination of
Units.
“Issue
Price” means the price at which a Unit is purchased from
the Partnership, after taking into account any sales commission or
underwriting discount charged to the Partnership and after taking
into account any other form of discount with respect to the price
at which a Unit is purchased from the Partnership; provided,
however , in the case of the Sponsor Class B Units, the
Issue Price shall be deemed to be $38.00 per unit, in the case of
the Privately Placed Class B Units, $35.81 per unit, and in
the case of the Privately Placed Common Units, $36.59 per
unit.
”
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, Class B Units, Subordinated Units and Incentive
Distribution Rights.
“Private
Common Unit Value” means with respect to the Privately
Placed Common Units, $38.00 per unit.
“Privately Placed Class B Units” means the
Class B Units issued pursuant to the Unit Purchase
Agreement.
“Privately Placed Common Units” means the Common
Units issued pursuant to the Unit Purchase Agreement.
“Purchase and Sale Agreement” means the Purchase
and Sale Agreement, dated November 16, 2006, by and among
Williams Energy Services, LLC, Williams Field Services Group, LLC,
Williams Field Services Company, LLC, the General Partner, the
Partnership and Williams Partners Operating LLC.
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“
Remaining Net Positive Adjustments ” means as of the
end of any taxable period, (i) with respect to the Unitholders
holding Common Units, Class B Units or Subordinated Units, the
excess of (a) the Net Positive Adjustments of the Unitholders
holding Common Units, Class B Units or 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 Units), 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 Units 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, Class B Units or
Subordinated Units, the amount that bears the same ratio to such
Additional Book Basis Derivative Items as the Unitholders’
Remaining Net Positive Adjustments as of the end of such period
bears to the Aggregate Remaining Net Positive Adjustments as of
that time, (ii) with respect to the General Partner (as holder
of the General Partner Units), the amount that bears the same ratio
to such Additional Book Basis Derivative Items as the General
Partner’s Remaining Net Positive Adjustments as of the end of
such period bears to the Aggregate Remaining Net Positive
Adjustment as of that time, and (iii) with respect to the
Partners holding Incentive Distribution Rights, the amount that
bears the same ratio to such Additional Book Basis Derivative Items
as the Remaining Net Positive Adjustments of the Partners holding
the Incentive Distribution Rights as of the end of such period
bears to the Aggregate Remaining Net Positive Adjustments as of
that time.
“Sponsor
Class B Units” means the Class B Units issued
to the General Partner or its designee pursuant to the Purchase and
Sale Agreement.
“
Unit ” means a Partnership Security that is designated
as a “Unit” and shall include Common Units,
Class B Units and Subordinated Units but shall not include
(i) General Partner Units (or the General Partner Interest
represented thereby) or (ii) Incentive Distribution
Rights.
“ Unit
Majority ” means, during the Subordination Period, at
least a majority of the Outstanding Common Units (excluding Common
Units owned by the General Partner and its Affiliates) voting as a
single class, at
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least a
majority of the Outstanding Class B Units voting as a single
class, and at least a majority of the Outstanding Subordinated
Units voting as a single class, and after the end of the
Subordination Period, at least a majority of the Outstanding
Units.
“Unit
Purchase Agreement” means the Common Unit and
Class B Unit Purchase Agreement, dated as of December 1,
2006, among the Partnership and the purchasers named
therein.
2. Section 1.1
of the Partnership Agreement is hereby further amended to amend and
restate the final sentence to the definition of “Common
Unit” as follows:
“The term
“ Common Unit ” does not include a Subordinated
Unit or a Class B Unit prior to its conversion into a Common
Unit pursuant to the terms hereof.”
3. Section 1.1
of the Partnership Agreement is hereby further amended to add the
following new sentence at the end of the definition of
“Subordinated Unit”:
“In
addition to the foregoing, for the avoidance of doubt, the term
“ Subordinated Unit ” does not include a
Class B Unit.”
4. Section 4.5(d)
of the Partnership Agreement is hereby amended and restated to read
in its entirety:
“(d) The
General Partner and its Affiliates shall have the right at any time
to transfer their Subordinated Units, Class B Units and Common
Units (whether issued upon conversion of the Subordinated Units,
the Class B Units or otherwise) to one or more
Persons.”
5. Section 4.8(c)
of the Partnership Agreement is hereby amended and restated to read
in its entirety:
“(c) The
transfer of a Subordinated Unit that has converted into a Common
Unit shall be subject to the restrictions imposed by
Section 6.7(c). The transfer of a Class B Unit that has
converted into a Common Unit shall be subject to the restrictions
imposed by Section 6.7(d). The transfer of a Privately Placed
Common Unit shall be subject to the restrictions imposed by
Section 6.7(d).”
6. Section 5.5(a)
of the Partnership Agreement is hereby amended to add the following
at the end of such section:
“The
initial Capital Account balance in respect of each Privately Placed
Class B Unit and each Sponsor Class B Unit shall be the
Class B Unit Value, and the initial Capital Account balance of
each holder of Class B Units in respect of all Class B
Units held thereby shall be the product of such initial balance for
a Class B Unit multiplied by the number of
Class B
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Units held
thereby. The initial Capital Account balance in respect of each
Privately Placed Common Unit shall be the Private Common Unit
Value, and the initial Capital Account balance of each holder of
Privately Placed Common Units in respect of all Privately Placed
Common Units held shall be the product of such initial balance for
a Privately Placed Common Unit multiplied by the number of
Privately Placed Common Units held thereby. Immediately following
the creation of a Capital Account balance in respect of each
Class B Unit, each Unitholder acquiring a Class B Unit at
original issuance shall be deemed to have received a cash
distribution in respect of such Class B Units in an amount
equal to the product of (x) the total number of Class B
Units so acquired by such Unitholder, multiplied by
(y) either, (A) in the case of Privately Placed
Class B Units, the difference between the Class B Unit
Value and the Issue Price of a Privately Placed Class B Unit,
or (B) in the case of Sponsor Class B Units, the
difference between the Class B Unit Value and the Issue Price
of a Sponsor Class B Unit. Immediately following the creation
of a Capital Account balance in respect of each Privately Placed
Common Unit, each Unitholder acquiring a Privately Placed Common
Unit at original issuance shall be deemed to have received a cash
distribution in respect of such Privately Placed Common Units in an
amount equal to the product of (x) the total number of
Privately Placed Common Units so acquired by such Unitholder,
multiplied by (y) the difference between the Private Common
Unit Value and the Issue Price of a Privately Placed Common
Unit.”
7. Section 5.5(d)(i)
of the Partnership Agreement is hereby amended to add the following
at the end of such section:
“Any
adjustments that are made under this paragraph in connection with
the issuance of the Class B Units and the Privately Placed
Common Units shall be based on the Class B Unit Value, in the
case of Class B Units, and the Private Common Unit Value, in
the case of Privately Placed Common Units.”
8. Section 5.7
of the Partnership Agreement is hereby amended to add a new clause
(iv) to Section 5.7(b) as follows:
“(iv) the
Cumulative Class B Unit Arrearage on all of the Outstanding
Class B Units is zero.”
9. Section 5.9(a)
of the Partnership Agreement is hereby amended and restated to read
in its entirety:
“(a)
Subject to Section 5.9(d), Section 6.6 and
Section 6.9 (dealing with adjustments of distribution levels),
the Partnership may make a Pro Rata distribution of Partnership
Securities to all Record Holders or may effect a subdivision or
combination of Partnership Securities so long as, after any such
event, each Partner shall have the same Percentage Interest in
the
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Partnership as
before such event, and any amounts calculated on a per Unit basis
(including any Common Unit Arrearage, Cumulative Common Unit
Arrearage, Class B Unit Arrearage or Cumulative Class B
Unit Arrearage) or stated as a number of Units (including the
number of Common Units into which Subordinated Units may convert
prior to the end of the Subordination Period and the number of
Common Units into which Class B Units may convert) are
proportionately adjusted.”
10. Article V
of the Partnership Agreement is hereby amended to add a new
Section 5.11 creating a new class of Units as
follows:
“Section 5.11 Establishment of
Class B Units
(a)
General. The General Partner hereby designates and creates a
class of Units to be designated as “Class B Units”
and consisting of a total of 6,805,492 Class B Units, and
fixes the designations, preferences and relative, participating,
optional or other special rights, powers and duties of holders of
the Class B Units as set forth in this
Section 5.11.
(b) Rights of
Class B Units. During the period commencing upon
issuance
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