Common use of ORGANIZATION AND OPERATIONS Clause in Contracts

ORGANIZATION AND OPERATIONS. The Partnership was organized December 31, 1991 as a limited partnership under the Delaware Act for the purpose of acquiring and developing oil and gas properties. The general partners were converted to limited partners on November 30, 1992. The managing general partner received an opinion of legal counsel to the effect that such conversion will not result in material adverse tax consequences. The following is a brief summary of the more significant provisions of the limited partnership agreement: Managing general partner - The managing general partner of the Partnership is Pioneer USA. Pioneer USA has the power and authority to manage, control and administer all Partnership affairs. As managing general partner and operator of the Partnership's properties, all production expenses are incurred by Pioneer USA and billed to the Partnership and a portion of revenue is initially received by Pioneer USA prior to being paid to the Partnership. Under the limited partnership agreement, the managing general partner pays 1% of the Partnership's acquisition, drilling and completion costs, and 1% of its operating and general and administrative expenses. In return it is allocated 1% of the Partnership's revenues. Limited partner liability - The maximum amount of liability of any limited partner is the total contributions of such partner plus his share of any undistributed profits. Initial capital contributions - The limited partners entered into subscription agreements for aggregate capital contributions of $11,249,000. The managing general partner is required to contribute amounts equal to 1% of initial Partnership capital less sales commission costs allocated to the limited partners and to contribute amounts necessary to pay costs and expenses allocated to it under the Partnership agreement to the extent its share of revenues does not cover such costs.

Appears in 1 contract

Sources: Proxy Statement (Pioneer Natural Resources Usa Inc)

ORGANIZATION AND OPERATIONS. The Partnership was organized December 31September 30, 1991 as a limited partnership under the Delaware Act for the purpose of acquiring and developing oil and gas properties. The general partners were converted to limited partners on November 30, 1992. The managing general partner received an opinion of legal counsel to the effect that such conversion will not result in material adverse tax consequences. The following is a brief summary of the more significant provisions of the limited partnership agreement: Managing general partner - -- The managing general partner of the Partnership is Pioneer USA. Pioneer USA has the power and authority to manage, control and administer all Partnership affairs. As managing general partner and operator of the Partnership's properties, all production expenses are incurred by Pioneer USA and billed to the Partnership and a portion of revenue is initially received by Pioneer USA prior to being paid to the Partnership. Under the limited partnership agreement, the managing general partner pays 1% of the Partnership's acquisition, drilling and completion costs, and 1% of its operating and general and administrative expenses. In return it is allocated 1% of the Partnership's revenues. Limited partner liability - -- The maximum amount of liability of any limited partner is the total contributions of such partner plus his share of any undistributed profits. Initial capital contributions - -- The limited partners entered into subscription agreements for aggregate capital contributions of $11,249,00011,620,000. The managing general partner is required to contribute amounts equal to 1% of initial Partnership capital less sales commission costs allocated to the limited partners and to contribute amounts necessary to pay costs and expenses allocated to it under the Partnership partnership agreement to the extent its share of revenues does not cover such costs.

Appears in 1 contract

Sources: Proxy Statement (Pioneer Natural Resources Usa Inc)