EXHIBIT 3
RESTATED ARTICLES OF INCORPORATION
OF
ENSERCH EXPLORATION, INC.
1. Enserch Exploration, Inc., pursuant to the provisions of
Article 4.07 of the Texas Business Corporation Act, hereby adopts
Restated Articles of Incorporation which accurately copy the Articles
of Incorporation and all amendments thereto that are in effect to
date and such Restated Articles of Incorporation contain no change
in any provision thereof.
2. The Restated Articles of Incorporation were adopted by
resolution of the Board of Directors of the Corporation on December
27, 1994.
3. The Restated Articles of Incorporation and all amendments
and supplements thereto are hereby superseded by the following
Restated Articles of Incorporation which accurately copy the entire
text thereof:
ARTICLE ONE
The name of the Company is Enserch Exploration, Inc.
ARTICLE TWO
The period of its duration is perpetual.
ARTICLE THREE
The purposes for which the Company is organized are:
(1) To engage in all phases of the oil and gas business
and related activities, including, but not by way of
limitation, engaging in exploration, drilling, development,
and production of oil and gas properties;
(2) To store, transport, buy and sell, oil, gas, salt,
brine and other mineral solutions and liquefied minerals;
(3) To explore for, produce, purchase and sell, store,
process and manufacture, transport and distribute oil, gas and
all other minerals;
(4) To manufacture, produce, purchase or otherwise
acquire, sell or dispose of, distribute, mortgage, pledge,
lease, repair, install, operate, deal in and with, whether as
principal or agent, products, goods, appliances, wares,
merchandise, fixtures, plants, structures, machinery, and
materials of every kind and description, to lend money for the
carrying out of such purposes, and to take and hold real and
personal property for the payment of such funds so loaned; and
(5) To transact any or all lawful business for which
corporations may be incorporated under the Texas Business
Corporation Act, as amended and in effect from time to time
(the "TBCA").
ARTICLE FOUR
(A) Authorized Capital Stock: The aggregate number of shares
of all classes of stock which the Company shall have authority to
issue is 202,000,000 consisting of and divided into:
(i) one class of 200,000,000 shares of Common Stock, par
value $1.00 per share (the "Common Stock"); and
(ii) one class of 2,000,000 shares of Preferred Stock, of no
par value (the "Preferred Stock"), which may be divided
into and issued in one or more series, as hereinafter
provided.
(B) Series: The Preferred Stock may be divided into and
issued in, at any time and from time to time, one or more series as
the Board of Directors of the Company shall determine pursuant to
the authority hereby vested in it. The Board of Directors shall
have the authority to establish series of unissued shares of
Preferred Stock, at any time and from time to time, by fixing and
determining the designations, preferences, limitations and relative
rights of the shares of the series, subject to and within the
limitations of the TBCA and the Articles of Incorporation,
including without limitation the following:
(a) the number of shares constituting the series and the
distinctive designation of that series;
(b) the dividend rate on shares of the series, the dividend
payment dates, whether dividends shall be cumulative
(and, if so, from which date or dates), non-cumulative,
or partially cumulative, and the relative rights of
priority, if any, of payment of dividends on the shares
of the series;
(c) the amount payable to the holders of shares of the series
upon any voluntary or involuntary liquidation of the
Company;
(d) the preference in the assets of the Company over any
other class, classes or series of shares upon the
voluntary or involuntary liquidation of the Company;
(e) whether the shares of the series are redeemable at the
option of the Company, the shareholder or another person
or upon occurrence of a designated event and, if so, the
price payable upon redemption of shares of the series and
the terms and conditions on which such shares are
redeemable;
(f) the provisions of the sinking fund, if any, for the
redemption or purchase of shares of the series;
(g) the voting rights, if any, of the shares of the series;
(h) the terms and conditions, if any, on which such shares
may be converted, at the option of the Company, the
shareholder or another person or upon occurrence of a
designated event, into shares of any other class or
series;
(i) the terms and conditions, if any, on which such shares
may be exchanged, at the option of the Company, the
shareholder or another person or upon occurrence of a
designated event, for shares, obligations, indebtedness,
evidences of ownership, rights to purchase securities or
other securities of the Company or one or more other
domestic or foreign corporations or other entities or for
other property or for any combination of the foregoing;
and
(j) any other special rights and qualifications, limitations
or restrictions permitted by the TBCA to be granted to or
imposed on the series.
Any of the designations, preferences, limitations and relative
rights of the shares of any series so established may be made
dependent upon facts ascertainable outside the Articles of
Incorporation, which facts may include future acts of the Company,
provided that the manner in which such facts shall operate upon the
designations, preferences, limitations and relative rights of the
shares of any series shall be set forth in the resolution or
resolutions establishing the series.
All shares within the same series of Preferred Stock shall be
identical except as to the date of issue and the dates from which
dividends on shares of the series issued on different dates will
cumulate, if cumulative. The Board of Directors shall have the
authority to increase or decrease the number of shares within each
series of Preferred Stock; provided, however, that the Board of
Directors may not decrease the number of shares within a series to
less than the number of shares within such series that are then
issued.
(C) Preemptive Rights. No shareholder of the Company shall
by reason of the shareholder's holding shares of any class or
series have any preemptive or preferential right to purchase or
subscribe to any shares of any class or series of the Company, now
or hereafter to be authorized, or any notes, debentures, bonds or
other securities convertible into or carrying options or warrants
to purchase shares of any class or series, now or hereafter to be
authorized, whether or not the issuance of any such shares, or such
notes, debentures, bonds or other securities, would adversely
affect the dividend or voting rights of such shareholders, other
than such rights, if any, as the Board of Directors in its
discretion may fix; and the Board of Directors may issue shares of
any class or series of the Company, or any notes, debentures, bonds
or other securities convertible into or carrying options or
warrants to purchase shares of any class or series, without
offering any such shares of any class or series, either in whole or
in part, to the existing shareholders of any class or series.
(D) Subordination of Common Stock: The Common Stock shall be
subject and subordinate to the rights, privileges and preferences
of any series of Preferred Stock to the extent set forth in the
resolution adopted by the Board of Directors establishing the
series.
(E) Other Provisions Applicable to Capital Stock:
(a) Each outstanding share of Common Stock shall be entitled
to one vote on each matter submitted to a vote at a
meeting of shareholders, except as otherwise provided by
the TBCA or as set forth in the resolutions adopted by
the Board of Directors establishing any series of
Preferred Stock.
(b) At each election for directors, every shareholder
entitled to vote at such election shall have the right to
vote the number of shares owned by him for as many
persons as there are directors to be elected and for
whose election he has a right to vote; provided that
cumulative voting in the election for directors is
prohibited.
(c) In the event of any dissolution, liquidation or winding
up of the Company, but subject to the rights of the
holders of any series of Preferred Stock, holders of
Common Stock shall be entitled to receive pro rata all of
the remaining assets of the Company available for
distribution to its shareholders.
(d) Any action required by the TBCA to be taken at any annual
or special meeting of shareholders, or any action which
may be taken at any annual or special meeting of
shareholders, may be taken without a meeting, without
prior notice, and without a vote, if a consent or
consents in writing, setting forth the action so taken,
shall be signed by the holder or holders or shares having
not less than the minimum number of votes that would be
necessary to take such action at a meeting at which the
holders of all shares entitled to vote on the action were
present and voted.
(e) Subject to the rights of the holders of Preferred Stock
as set forth in the resolutions adopted by the Board of
Directors establishing any series of Preferred Stock,
dividends may be paid upon Common Stock to the exclusion
of Preferred Stock out of any assets of the Company
available therefor.
ARTICLE FIVE
The Company will not commence business until it has received
for the issuance of its shares consideration of the value of at
least One Thousand Dollars ($1,000.00) consisting of money, labor
done, or property actually received.
ARTICLE SIX
The street address of its initial registered office is 300
South St. Paul, Dallas, Texas 75201, and the name of its initial
registered agent at such address is Michael G. Fortado.
ARTICLE SEVEN
Subject to the provisions of Article Four, the number of
directors constituting the initial Board of Directors is two (2),
subject to being increased or decreased as the Bylaws of the
Company may provide. The names and addresses of the persons who
are to serve as directors until the first annual meeting of the
shareholders or until their successors be elected and qualified
are:
D. W. Biegler 300 South St. Paul
Dallas, Texas 75201
G. J. Junco Energy Square II
4849 Greenville Avenue
Dallas, Texas 75206
ARTICLE EIGHT
(A) Power to Alter, Amend or Repeal Bylaws. The power to
alter, amend or repeal the Bylaws or to adopt new Bylaws shall be
vested in the Board of Directors; provided however that any Bylaw
or amendment thereto as adopted by the Board of Directors may be
altered, amended or repealed by vote of the shareholders entitled
to vote for the election of directors or a new Bylaw in lieu
thereof may be adopted by vote of such shareholders. No Bylaw that
has been altered, amended or adopted by such a vote of the
shareholders may be altered, amended or repealed by vote of the
directors until two years shall have expired since such action by
vote of such shareholders.
(B) Stock Ownership Restrictions. The Board of Directors of
the Company shall have the power and authority, from time to time,
to adopt, alter or amend the Bylaws of the Company to add or amend
such provisions as in their judgment may be necessary or
appropriate to ensure that the Company and its shareholders satisfy
the citizenship or other requirements imposed by any federal or
state law relating to the ownership, possession or leasing of gas,
oil or other minerals, land, vessels or any other property,
licenses or rights of any nature whatsoever in which the Company or
any of its subsidiaries may have or hereafter have, or seek to
have, any right or interest. Without limiting such general powers,
the Board of Directors shall have the power and authority, from
time to time, to adopt, alter or amend the Bylaws to add or amend
provisions which for such purpose impose restrictions on the
transfer or registration of transfer of the shares of the Company,
including, without limitation, restrictions which:
(1) obligate the holders of the restricted shares to
offer to the Company or to any other holders of shares of the
Company or to any other person or to any combination of the
foregoing, a prior opportunity, to be exercised within a
reasonable time, to acquire the restricted shares;
(2) provide that the Company or the holders of any class
of shares of the Company must consent to any proposed transfer
of the restricted shares or approve the proposed transferee of
the restricted shares before the transfer may be effected;
(3) prohibit the transfer of the restricted shares to
designated persons or classes of persons; or
(4) maintain any tax or other status or advantage to the
Company.
ARTICLE NINE
To the fullest extent permitted by law, a director of the
Company shall not be liable to the Company or its shareholders for
monetary damages for any act or omission in his capacity as a
director. Any repeal or modification of this Article shall be
prospective only and shall not adversely affect any limitation of
the personal liability of a director of the Company existing at the
time of the repeal or modification.
ARTICLE TEN
The name and address of the incorporator are:
W. T. Satterwhite........300 South St. Paul
Dallas, Texas 75201
ARTICLE ELEVEN
INTERESTED DIRECTORS, OFFICERS AND SECURITYHOLDERS
(A) Validity. A contract or other transaction between the
Company and ENSERCH Corporation ("EC"), or any subsidiary or other
corporation, partnership, limited liability company or other entity
in which EC is directly or indirectly interested (collectively with
EC, an "EC Person"), shall not be invalid because of this
relationship or because of the presence of a director, officer or
securityholder of an EC Person at the meeting authorizing the
contract or transaction, or such person's participation or vote in
the meeting or authorization or in a unanimous or other written
consent thereto, if the contract or other transaction is effected
in accordance with any of paragraphs (B), (C), (D), (E), (F), (G),
or (H) below.
(B) Disclosure; Approval; Fairness. Paragraph (A) shall
apply if:
(1) the material facts of the relationship or interest
of each EC Person or such director, officer or securityholder
are known or disclosed:
(a) to the Board of Directors of the Company, or a
committee of the Board of Directors, and it nevertheless
authorizes or ratifies the contract or transaction by a
majority of the directors present; or
(b) to the shareholders of the Company and they
nevertheless authorize or ratify the contract or
transaction by a majority of the shares present, each
such EC Person or other interested person to be counted
for quorum and voting purposes; or
(2) the contract or transaction is fair to the Company
as of the time it is authorized or ratified by the Board of
Directors or the shareholders of the Company.
(C) Loans from or to an EC Person.
(1) Any EC Person may lend to the Company funds needed
by the Company for such periods of time as may be determined
by the Board of Directors of the Company or otherwise in
accordance with the Bylaws of the Company; provided, however,
that such EC Person may not charge the Company interest at a
rate greater than the lesser of (i) the EC Person's actual
average interest cost (including points or other financing
charges or fees, if any), or (ii) the rate (including points
or other financing charges or fees) that would be charged the
Company (without reference to the Company's financial
abilities or guaranties) by unrelated lenders on comparable
loans. The Company shall reimburse the EC Person for any
costs incurred by the EC Person in connection with the
borrowing of funds obtained by the EC Person and loaned to the
Company.
(2) The Company may lend funds to any EC Person;
provided however that the Company may not charge interest at
a rate lesser than the rate (including points or other
financing charges or fees) that would be charged the EC Person
(without reference to third parties' financial abilities or
guaranties) by unrelated lenders on comparable loans.
(D) Common Personnel. Officers, directors, employees,
attorneys and agents of the Company may also serve as directors,
officers, employees, attorneys or agents of an EC Person, provided
that the Company and the EC Person shall each compensate its
directors, officers, employees, attorneys and agents in respect of
the services performed for it, unless a compensation sharing
arrangement has been effected in accordance with paragraph (B).
(E) IntraCompany Transactions. EC Persons may sell gas, oil,
goods and services to, and may purchase gas, oil, goods and
services from, the Company, provided that such transactions shall
be (i) on terms comparable to those effected with unaffiliated
persons or (ii) effected in accordance with paragraph (B).
(F) Services Provided by an EC Person. An EC Person may
provide the Company with certain services including, but not
limited to, the following: accounting and treasury, internal
audit, human resources (such as training, employment and salary and
benefit plan administration), tax planning and compliance, legal,
financial management, corporate development and planning, investor
relations, information systems, materials management, risk and
claims management and office services and the management of these
functions. The Company shall reimburse each EC Person for the
direct and indirect costs incurred in connection with the
furnishing of such services to the Company. Costs shall be
determined on a basis reasonably calculated to reflect the actual
costs of the services performed by such EC Person and may include
allocations based on such factors as net capital employed, the
number of employees or the percentage of time spent on projects or
services.
(G) Purchase or Sale of Shares. An EC Person may purchase or
otherwise acquire and sell or otherwise dispose of shares or other
securities of the Company for its own account (i) in transactions
with persons other than the Company or (ii) in transactions with
the Company effected in accordance with paragraph (B).
(H) Outside Activities. Any EC Person shall be entitled to
and may have business interests and engage in business activities
in addition to those relating to the Company, may engage in the
acquisition, ownership, operation and management of working,
nonparticipating or other interests or royalties in gas and oil
properties, and any other businesses or activities, including
business interests and activities in direct competition with the
Company, for their own account and for the account of others, and
may own interests in the same properties as those in which the
Company owns an interest, without having or incurring any
obligation to offer any interest in such properties, businesses or
activities to the Company. Neither the Company nor any of its
shareholders shall have any preferential or other right to acquire
any interest or participate in any business venture of any EC
Person.
(I) Non-Exclusive. This provision shall not be construed to
invalidate a contract or transaction that would be valid in the
absence of this provision.
Dated this 27th day of December, 1994.
ENSERCH EXPLORATION, INC.
By /s/ Gary J. Junco
--------------------------
President