Xxxxxx Xxxxxx Energy Partners, L.P.
Debt Securities
Underwriting Agreement
_________, 1998
Xxxxxxx, Sachs & Co.,
[Name(s) of Co-Representative(s),]
c/o Goldman, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
From time to time Xxxxxx Xxxxxx Energy Partners, L.P. a Delaware limited
partnership (the "Partnership"), proposes to enter into one or more Pricing
Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such
additions and deletions as the parties thereto may determine, and, subject to
the terms and conditions stated herein and therein, to issue and sell to the
firms named in Schedule I to the applicable Pricing Agreement (such firms
constituting the "Underwriters" with respect to such Pricing Agreement and the
securities specified therein) certain of its debt securities (the "Securities")
specified in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The Partnership, Xxxxxx Xxxxxx Operating L.P. "A," a Delaware limited
partnership ("OLP-A"), Xxxxxx Xxxxxx Operating L.P. "B," a Delaware limited
partnership ("OLP-B"), Xxxxxx Xxxxxx Operating L.P. "C," a Delaware limited
partnership ("OLP-C"), Xxxxxx Xxxxxx Operating L.P. "D," a Delaware limited
partnership ("OLP-D" and, together with OLP-A, OLP-B and OLP-C, the "Operating
Partnerships"), SFPP, L.P., a Delaware limited partnership ("SFPP"), Xxxxxx
Xxxxxx Bulk Terminals Corporation, a Louisiana corporation ("XXXX Corp."),
Xxxxxx Xxxxxx Natural Gas Liquids Corporation, a Delaware corporation ("KMNGL
Corp."), Xxxxxx Xxxxxx CO2, L.L.C., a Delaware limited liability company
("KM-LLC"), and Kinder Xxxxxx X.X., Inc., a Delaware corporation (the "General
Partner"), in its individual capacity and in its capacity as the general partner
of the Partnership and each of the Operating Partnerships, are collectively
referred to herein as the "Xxxxxx Xxxxxx Entities."
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to time
to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm
acting as sole representative of the Underwriters and to an Underwriter or
Underwriters who act without any firm being designated as its or their
representatives. This Underwriting Agreement shall not be construed as an
obligation of the Partnership to sell any of the Securities or as an obligation
of any of the Underwriters to purchase the Securities. The obligation of the
Partnership to issue and sell any of the Securities and the obligation of any of
the Underwriters to purchase any of the Securities shall be evidenced by the
Pricing Agreement with respect to the Designated Securities specified therein.
Each Pricing Agreement shall specify the aggregate principal amount of such
Designated Securities, the initial public offering price of such Designated
Securities, the purchase price to the Underwriters of such Designated
Securities, the names of the Underwriters of such Designated Securities, the
names of the Representatives of such Underwriters and the principal amount of
such Designated Securities to be purchased by each Underwriter and shall set
forth the date, time and manner of delivery of such Designated Securities and
payment therefor. The Pricing Agreement shall also specify (to the extent not
set forth in the Indenture and the registration statement and prospectus with
respect thereto) the terms of such Designated Securities. A Pricing Agreement
shall be in the form of an executed writing (which may be in counterparts), and
may be evidenced by an exchange of telegraphic communications or any other rapid
transmission device designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this Agreement and each
Pricing Agreement shall be several and not joint.
2. Each of the Xxxxxx Xxxxxx Entities represents and warrants to, and
agrees with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 33-....) (the
"Initial Registration Statement") in respect of the Securities has been filed
with the Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto (each in the
form heretofore delivered or to be delivered to the Representatives, excluding
exhibits to the Initial Registration Statement, but including all documents
incorporated by reference in the prospectus contained therein to the
Representatives for each of the other Underwriters) have been declared effective
by the Commission in such form; other than a registration statement, if any,
increasing the size of the offering (a "Rule 462(b) Registration Statement"),
filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the
"Act"), which became effective upon filing, no other document with respect to
the Initial Registration Statement or document incorporated by reference therein
has heretofore been filed or transmitted for filing with the Commission (other
than prospectuses filed pursuant to Rule 424(b) of the rules and regulations of
the Commission under the Act, each in the form heretofore delivered to the
Representatives); and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) under the Act, is hereinafter called a
"Preliminary Prospectus"; the various parts of the Initial Registration
Statement, any post-effective amendment thereto and the Rule 462(b) Registration
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Statement, if any, including all exhibits thereto and the documents incorporated
by reference in the prospectus contained in the Initial Registration Statement
at the time such part of the Initial Registration Statement became effective but
excluding Form T-1, each as amended at the time such part of the Initial
Registration Statement became effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective, are
hereinafter collectively called the "Registration Statement"; the prospectus
relating to the Securities, in the form in which it has most recently been
filed, or transmitted for filing, with the Commission on or prior to the date of
this Agreement, being hereinafter called the "Prospectus"; any reference herein
to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to the
applicable form under the Act, as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or supplement to
any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and incorporated by reference in such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any amendment to
the Initial Registration Statement shall be deemed to refer to and include any
annual report of the Partnership filed pursuant to Sections 13(a) or 15(d) of
the Exchange Act after the effective date of the Initial Registration Statement
that is incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed to refer
to the Prospectus as amended or supplemented in relation to the applicable
Designated Securities in the form in which it is filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof,
including any documents incorporated by reference therein as of the date of such
filing);
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become effective or
are filed with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Partnership by an Underwriter of Designated
Securities through the Xxxxxxx, Sachs & Co. expressly for use in the Prospectus
as amended or supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the Act
and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and
the rules and regulations of the Commission thereunder and do not and will not,
as of the applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the Prospectus and
any amendment or supplement thereto, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions made
in reliance upon and in conformity with information furnished in writing to the
3
Partnership by an Underwriter of Designated Securities through the
Representatives expressly for use in the Prospectus as amended or supplemented
relating to such Securities;
(d) None of the Xxxxxx Xxxxxx Entities has sustained since the date
of the latest audited financial statements included or incorporated by reference
in the Prospectus any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, there has not been any material change in the capitalization or
long-term debt of the Xxxxxx Xxxxxx Entities or any material adverse change, or
any development involving a prospective material adverse change, in or affecting
the general affairs, management, financial position, unitholders' equity or
results of operations of the Xxxxxx Xxxxxx Entities, taken as a whole, otherwise
than as set forth or contemplated in the Prospectus;
(e) Each of the Xxxxxx Xxxxxx Entities has good and marketable
title (or indefeasible title in the State of Texas) in fee simple to all real
property and good and marketable title to all personal property owned by them,
in each case free and clear of all liens, encumbrances and defects except such
as are described in the Prospectus or such as do not materially affect the value
of such property and do not materially interfere with the use made and proposed
to be made of such property by the Xxxxxx Xxxxxx Entities; and any real property
and buildings held under lease by a Xxxxxx Xxxxxx Entity is held under valid,
subsisting and enforceable leases with such exceptions as are not material and
do not materially interfere with the use made and proposed to be made of such
property and buildings by the Xxxxxx Xxxxxx Entities;
(f) The Partnership is, and at each Time of Delivery will be, a
limited partnership duly formed, validly existing and in good standing under the
laws of the State of Delaware. The Partnership has, and at each Time of Delivery
will have, all necessary partnership power and authority to conduct the
activities conducted by it, to own or lease all the assets owned or leased by it
and to conduct its business as described in the Registration Statement and the
Prospectus. The Partnership is, and at each Time of Delivery will be, duly
licensed or qualified to do business and in good standing as a foreign limited
partnership in all jurisdictions in which the nature of the activities conducted
by it or the character of the assets owned or leased by it makes such licensing
or qualification necessary (except where the failure to be so licensed or
qualified will not have a material adverse effect on the financial condition,
results of operations or business of the Xxxxxx Xxxxxx Entities, taken as a
whole, or subject the Partnership or the limited partners of the Partnership to
any material liability or disability). Complete and correct copies of the
Certificate of Limited Partnership of the Partnership, and all amendments
thereto, and of the Agreement of Limited Partnership of the Partnership, as
amended and restated (the "Partnership Agreement"), have been delivered to the
Underwriters;
(g) Each of the Operating Partnerships is, and at the applicable
Time of Delivery will be, a limited partnership duly formed, validly existing
and in good standing under the laws of the State of Delaware. Each of the
Operating Partnerships has, and at the applicable Time of Delivery will have,
all necessary partnership power and authority to conduct the activities
conducted by it, to own or lease all the assets owned or leased by it and to
conduct its
4
business as described in the Registration Statement and the Prospectus. Each of
the Operating Partnerships is, and at the applicable Time of Delivery will be,
duly licensed or qualified to do business and in good standing as a foreign
limited partnership in all jurisdictions in which the nature of the activities
conducted by it or the character of the assets owned or leased by it makes such
licensing or qualification necessary (except where the failure to be so licensed
or qualified will not have a material adverse effect on the financial condition,
results of operations or business of the Xxxxxx Xxxxxx Entities, taken as a
whole, or subject the Partnership or the limited partners of the Partnership to
any material liability or disability). Complete and correct copies of the
Certificate of Limited Partnership of each of the Operating Partnerships, and
all amendments thereto, and of the Agreement of Limited Partnership of OLP-A, as
amended and restated (the "OLP-A Agreement"), the Agreement of Limited
Partnership of OLP-B, as amended and restated (the "OLP-B Agreement"), the
Agreement of Limited Partnership of OLP-C, as amended and restated (the "OLP-C
Agreement"), and the Agreement of Limited Partnership of OLP-D, as amended and
restated (the "OLP-D Agreement" and, together with the OLP-A Agreement, the
OLP-B Agreement and the OLP-C Agreement, the "Operating Partnership
Agreements"), have been delivered to the Underwriters;
(h) SFPP is, and at the applicable Time of Delivery will be, a
limited partnership duly formed, validly existing and in good standing under the
laws of the State of Delaware. SFPP has, and at the applicable Time of Delivery
will have, all necessary partnership power and authority to conduct the
activities conducted by it, to own or lease all the assets owned or leased by it
and to conduct its business as described in the Registration Statement and the
Prospectus. SFPP is, and at the applicable Time of Delivery will be, duly
licensed or qualified to do business and in good standing as a foreign limited
partnership in all jurisdictions in which the nature of the activities conducted
by it or the character of the assets owned or leased by it makes such licensing
or qualification necessary (except where the failure to be so licensed or
qualified will not have a material adverse effect on the financial condition,
results of operations or business of the Xxxxxx Xxxxxx Entities, taken as a
whole, or subject the Partnership or the limited partners of the Partnership to
any material liability or disability). Complete and correct copies of the
Certificate of Limited Partnership of SFPP and of the Agreement of Limited
Partnership of SFPP, as amended and restated (the "SFPP Agreement"), and all
amendments thereto have been delivered to the Underwriters;
(i) Each of the General Partner and KMNGL Corp., is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware. XXXX Corp. is a corporation duly organized, validly existing
and in good standing under the laws of the State of Louisiana. KM-LLC is a
limited liability company duly formed, validly existing and in good standing
under the laws of the State of Delaware. Each of the General Partner, KMNGL
Corp., XXXX Corp. and KM-LLC has, and at the applicable Time of Delivery will
have, all necessary corporate or limited liability company power and authority,
as the case may be, to conduct all the activities conducted by it, to own or
lease all the assets owned or leased by it and to conduct its business as
described in the Registration Statement and the Prospectus. Each of the General
Partner, KMNGL Corp., XXXX Corp. and KM-LLC is, and at the applicable Time of
Delivery will be, duly licensed or qualified to do business and in good standing
as a foreign corporation or foreign limited liability company, as the case may
be, in all jurisdictions in which the nature of the activities conducted by it
or the character of the assets owned or leased by it makes such licensing or
qualification necessary (except where the failure to be so licensed or
5
qualified will not have a material adverse effect on the financial condition,
results of operations or business of the Xxxxxx Xxxxxx Entities, taken as a
whole, or subject the Partnership or the limited partners of the Partnership to
any material liability or disability). Complete and correct copies of the
certificate of incorporation and of the by-laws of the General Partner, KMNGL
Corp. and XXXX Corp. and the limited liability agreement of KM-LLC and all
amendments to such documents have been delivered to the Underwriter;
(j) To the knowledge of the Xxxxxx Xxxxxx Entities, each of
Heartland Partnership ("Heartland") and Mont Belvieu Associates ("Mont Belvieu")
is, and at the applicable Time of Delivery will be, a general partnership duly
formed and validly existing under the laws of the State of Texas and Shell CO2
Company Ltd. ("Shell CO2") is, and at the applicable Time of Delivery will be, a
limited partnership duly formed, validly existing and in good standing under the
laws of the State of Delaware. To the knowledge of the Xxxxxx Xxxxxx Entities,
each of Heartland, Mont Belvieu and Shell CO2 has, and at the applicable Time of
Delivery will have, all necessary partnership power and authority, to conduct
the activities conducted by it, to own or lease all the assets owned or leased
by it and to conduct its business as described in the Registration Statement and
the Prospectus, except as would not have a material adverse effect on the
financial condition, results of operations or business of such entities. To the
knowledge of the Xxxxxx Xxxxxx Entities, each of Heartland, Mont Belvieu and
Shell CO2 is, and at the applicable Time of Delivery will be, duly licensed or
qualified to do business and in good standing as a foreign partnership in all
jurisdictions in which the nature of the activities conducted by it or the
character of the assets owned or leased by it makes such licensing or
qualification necessary (except where the failure to be so licensed or qualified
will not have a material adverse effect on the financial condition, results of
operations or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or
subject the Partnership to any material liability or disability);
(k) The only subsidiaries (as such term is defined in the rules and
regulations of the Commission under the Act and the Exchange Act) of the
Partnership or other entities in which the Partnership, any of the Operating
Partnerships or SFPP has an equity ownership interest of 50% or more are those
listed on Schedule III hereto;
(l) Xxxxxx Xxxxxx, Inc., a Delaware corporation ("KMI"), owns, and
at the applicable Time of Delivery will own, all of the issued and outstanding
shares of capital stock of the General Partner; such shares of capital stock are
duly authorized, validly issued, fully paid and nonassessable;
(m) Xxxxxxx X. Xxxxxx, Xxxxxx Associates, Inc. ("MAI") and First
Union Corporation ("First Union") are the sole stockholders of KMI. Xxxxxxx X.
Xxxxxx owns 71.04% of the Class A voting stock of KMI. MAI owns 27.65% of the
Class A voting stock of KMI. First Union owns 1.30% of the Class A voting stock
and 100.0% of the Class B nonvoting stock of KMI. All of such shares of Class A
voting and Class B nonvoting stock are duly authorized, validly issued, fully
paid and nonassessable;
(n) The General Partner is the sole general partner of the Partnership
with a 1% general partner interest in the Partnership; such general partner
interest is duly authorized by the Partnership Agreement and was validly issued
to the General Partner; and, the General
6
Partner owns such general partner interest free and clear of all liens,
encumbrances, security interests, equities, charges or claims (except for such
liens, encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material or as described in the Registration
Statement or the Prospectus);
(o) The General Partner is the sole general partner of each of the
Operating Partnerships with a 1.0101% general partner interest in each of the
Operating Partnerships; such general partner interests are duly authorized by
the respective Operating Partnership Agreement, and were validly issued to the
General Partner; and the General Partner owns such general partner interests
free and clear of all liens, encumbrances, security interests, equities, charges
or claims (except for such liens, encumbrances, security interests, equities,
charges or claims as are not, individually or in the aggregate, material or as
described in the Registration Statement or the Prospectus);
(p) The Partnership is the sole limited partner of each of the
Operating Partnerships with a 98.9899% limited partner interest in each of the
Operating Partnerships; such limited partner interests, in each of such
Partnerships, are duly authorized by the respective Operating Partnership
Agreement, and were validly issued to the Partnership and are fully paid and
nonassessable (except as nonassessability may be affected by certain provisions
of the Delaware Revised Limited Partnership Act (the "Delaware Act")); and the
Partnership owns such limited partner interests free and clear of all liens,
encumbrances, security interests, equities, charges or claims (except for such
liens, encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material or as described in the Registration
Statement or the Prospectus, including the security interest securing certain
debt of the Partnership and OLP-B);
(q) OLP-A owns, and at the applicable Time of Delivery will own, all
of the issued and outstanding capital stock of KMNGL Corp., all of the issued
and outstanding capital stock of XXXX Corp. and all of the issued and
outstanding member interests of KM-LLC; all of such capital stock and such
member interests are duly authorized, validly issued, fully paid and
nonassessable; and OLP-A owns such capital stock and such member interests free
and clear of all liens, encumbrances, security interests, equities, charges or
claims (except for such liens, encumbrances, security interests, equities,
charges or claims as are not, individually or in the aggregate, material or as
described in the Registration Statement or the Prospectus);
(r) OLP-D is the sole general partner of SFPP with a 99.5% general
partner interest; such general partner interest is duly authorized by the SFPP
Agreement, and was validly issued to OLP-D; and OLP-D owns such general partner
interest free and clear of all liens, encumbrances, security interests,
equities, charges or claims (except for such liens, encumbrances, security
interests, equities, charges or claims as are not, individually or in the
aggregate, material or as described in the Registration Statement or the
Prospectus, including the security interest securing the guarantee of certain
debt of OLP-D to the Partnership); Santa Fe Pacific Pipelines, Inc. (the "SF
Limited Partner") is the sole limited partner of SFPP with a 0.5% non-voting,
limited partner interest; such limited partner interest is duly authorized by
the SFPP Agreement, and validly issued to the SF Limited Partner and fully paid
and nonassessable (except as nonassessability may be affected by certain
provisions of the Delaware Act);
7
(s) OLP-A is a general partner of Heartland with a 50% general partner
interest in Heartland, KMNGL Corp. is a general partner of Mont Belvieu with a
50% general partner interest in Mont Belvieu, and KM-LLC is a limited partner of
Shell CO2, with a 20% limited partner interest in Shell CO2; such general
partner interests and such limited partner interests are duly authorized by the
respective partnership agreement of Heartland, Mont Belvieu and Shell CO2, and
were validly issued by each of Heartland, Mont Belvieu and Shell CO2,
respectively, and in the case of such limited partner interests is fully paid
and nonassessable (except as such nonassessability may be affected by certain
provisions of the Delaware Act); and, OLP-A and KMNGL Corp. own such general
partner interests in Heartland and Mont Belvieu, respectively, and KM-LLC owns
such limited partner interest, free and clear of all liens, encumbrances,
security interests, equities, charges or claims (except for such liens,
encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material or as described in the Registration
Statement or the Prospectus);
(t) At each Time of Delivery, the Common Units will be the only
limited partner interests of the Partnership that are issued and outstanding at
the applicable Time of Delivery, all of the issued and outstanding Common Units
have been duly and validly authorized and issued, and are fully paid and
nonassessable (except as nonassessability may be affected by certain provisions
of the Delaware Act) and substantially conform to the description of the Common
Units incorporated by reference into the Prospectus;
(u) Each of the Xxxxxx Xxxxxx Entities has all necessary partnership,
corporate or limited liability company power and authority, as the case may be,
to enter into this Agreement. This Agreement has been duly authorized, executed
and delivered by each of the Xxxxxx Xxxxxx Entities and constitutes a valid and
binding agreement with respect to each of such entities and is enforceable
against each of them in accordance with the terms hereof;
(v) The Securities have been duly authorized, and, when Designated
Securities are issued and delivered pursuant to this Agreement and the Pricing
Agreement with respect to such Designated Securities, such Designated Securities
will have been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Partnership entitled to
the benefits provided by the Indenture, which will be substantially in the form
filed as an exhibit to the Registration Statement; the Indenture has been duly
authorized and duly qualified under the Trust Indenture Act and, at the Time of
Delivery for such Designated Securities (as defined in Section 4 hereof), the
Indenture will constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles; and the
Indenture conforms, and the Designated Securities will conform, to the
descriptions thereof contained in the Prospectus as amended or supplemented with
respect to such Designated Securities;
(w) The issue and sale of the Securities and the compliance by the
Partnership with all of the provisions of the Securities, the Indenture, this
Agreement and any Pricing Agreement, and the consummation of the transactions
herein and therein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Partnership is a party or by which the Partnership is
bound or to which
8
any of the property or assets of the Partnership is subject, nor will such
action result in any violation of the provisions of the Partnership Agreement of
the Partnership or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Partnership or any of
its properties, except where such occurrence will not prevent the consummation
of the transactions contemplated herein and will not have a material adverse
effect on the financial condition, results of operations or business of the
Xxxxxx Xxxxxx Entities, taken as a whole, or subject the Partnership to any
material liability or disability; and no consent, approval, authorization,
order, registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities or the
consummation by the Partnership of the transactions contemplated by this
Agreement or any Pricing Agreement or the Indenture, except such as have been,
or will have been prior to the Time of Delivery, obtained under the Act and the
Trust Indenture Act and such consents, approvals, authorizations, registrations
or qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Securities by the
Underwriters;
(x) None of the Xxxxxx Xxxxxx Entities is (a) in violation of its
Certificate of Incorporation, By-laws, Partnership Agreement or other
organizational documents, as the case may be, or (b) in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound, except for such violations and defaults as (i)
would not have a material adverse effect on the financial condition, results of
operations or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or
subject the Partnership to any material liability or disability and (ii) in the
case of such violations, have been disclosed in writing to Xxxxxxx, Sachs & Co.
prior to the execution of this Agreement;
(y) The statements set forth in the Prospectus under the captions
"Description of Debt Securities" and "Description of Notes", insofar as they
purport to constitute a summary of the terms of the Securities, and under the
captions "Plan of Distribution" and "Underwriting", insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate, complete and fair; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Partnership by an
Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein;
(z) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which any of the Xxxxxx Xxxxxx
Entities is a party or of which any property of any Xxxxxx Xxxxxx Entity is the
subject which, if determined adversely to the respective Xxxxxx Xxxxxx Entity,
would individually or in the aggregate have a material adverse effect on the
financial condition, results of operations or business of the Xxxxxx Xxxxxx
Entities, taken as a whole, or subject the Partnership to any material liability
or disability; and, to the knowledge of the Xxxxxx Xxxxxx Entities, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(aa) None of the Xxxxxx Xxxxxx Entities is, nor at each Time of
Delivery will be, (i) a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate"
9
thereof, within the meaning of the Public Utility Holding Company Act of 1935,
as amended, or (ii) an "investment company," a person "controlled by" an
"investment company" or an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended;
(bb) None of the Xxxxxx Xxxxxx Entities or any of their affiliates
does business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Xxxxxxx 000.000, Xxxxxxx Xxxxxxxx;
(xx) Xxxxxx Xxxxxxxx LLP and PriceWaterhouseCoopers LLP, who have
certified certain financial statements of the Xxxxxx Xxxxxx Entities, and in the
case of PriceWaterhouseCoopers LLP, who has also certified certain financial
statements of Santa Fe Pacific Pipeline Partners, L.P. ("Santa Fe"), are each
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder;
(dd) The Partnership has reviewed its operations and that of its
subsidiaries and any third parties with which the Partnership or any of its
subsidiaries has a material relationship to evaluate the extent to which the
business or operations of the Partnership or any of its subsidiaries will be
affected by the Year 2000 Problem. As a result of such review, the Partnership
does not believe that the Year 2000 Problem will have a material adverse effect
on the financial condition, results of operation or business of the Kinder
Entities, taken as a whole, or result in any material loss or interference with
their business or operations. The "Year 2000 Problem" as used herein means any
significant risk that computer hardware or software used in the receipt,
transmission, processing, manipulation, storage, retrieval, retransmission or
other utilization of data or in the operation of mechanical or electrical
systems of any kind will not, in the case of dates or time periods occurring
after December 31, 1999, function at least as effectively as in the case of
dates or time periods occurring prior to January 1, 2000;
(ee) The financial statements and schedules included or
incorporated by reference in the Registration Statement or the Prospectus
present fairly the consolidated financial condition of the Partnership, the
General Partner and Santa Fe as of the respective dates thereof and the
consolidated results of operations and cash flows of the Partnership and Santa
Fe for the respective periods covered thereby, all in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
entire period involved, except as otherwise disclosed in the Prospectus. No
other financial statements or schedules of the Partnership, the General Partner
and Santa Fe are required by the Act, the Exchange Act or the rules and
regulations of the Commission under such acts to be included in the Registration
Statement or the Prospectus. The statements included in the Registration
Statement with respect to the Accountants pursuant to Rule 509 of Regulation S-K
of the Rules and Regulations are true and correct in all material respects;
(ff) Each of the Xxxxxx Xxxxxx Entities maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded
10
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences;
(gg) The pro forma financial statements included in or incorporated by
reference in the Registration Statement and the Prospectus, including the
presentation of the acquisition of SFPP contained in such pro forma financial
statements, comply as to form in all material respects with the applicable
accounting requirements of the Act, the Exchange Act and the rules and
regulations of the Commission under such acts, have been prepared on a basis
consistent with the historical consolidated financial statements of the
Partnership and Santa Fe and give effect to the assumptions used in the
preparation thereof on a reasonable basis and in good faith;
(hh) Each of the Xxxxxx Xxxxxx Entities (i) is in compliance with
any and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
imposing liability or standards of conduct concerning any Hazardous Material (as
hereinafter defined) ("Environmental Laws"), (ii) has received all permits,
licenses or other approvals required of them under applicable Environmental Laws
to conduct their respective businesses and (iii) is in compliance with all terms
and conditions of any such permit, license or approval, except as disclosed in
the Prospectus or where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would not result
in a material adverse effect on the financial condition, results of operations
or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or subject the
Partnership or the limited partners of the Partnership to any material liability
or disability. The term "Hazardous Material" means (A) any "hazardous substance"
as defined by the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, (B) any "hazardous waste" as defined by the
Resource Conservation and Recovery Act, as amended, (C) any petroleum or
petroleum product, (D) any polychlorinated biphenyl and (E) any pollutant or
contaminant or hazardous, dangerous, or toxic chemical, material, waste or
substance regulated under or within the meaning of any other Environmental Law;
(ii) In the ordinary course of its business, each of the Xxxxxx Xxxxxx
Entities conducts a periodic review of the effect of Environmental Laws on the
business, operations and properties of such entity, in the course of which it
identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties). Except as set forth in the Registration Statement
and the Prospectus, there are no costs and liabilities associated with or
arising in connection with Environmental Laws as currently in effect (including,
without limitation, costs of compliance therewith) which would have a material
adverse effect on the financial condition, results of operations or business of
the Xxxxxx Xxxxxx Entities, taken as a whole, or subject the Partnership to any
material liability or disability;
(jj) Each of the Xxxxxx Xxxxxx Entities is in compliance with all
federal, state and local employment and labor laws, including, but not limited
to, laws relating to non-discrimination in hiring, promotion and pay of
employees (except where such noncompliance will not have a material adverse
effect on the financial condition, results of
11
operations or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or
subject the Partnership to any material liability or disability); no labor
dispute with the employees of any of the Xxxxxx Xxxxxx Entities exists or, to
the knowledge of any of the Xxxxxx Xxxxxx Entities, is imminent or threatened,
except as would not have a material adverse effect on the financial condition,
results of operation or business of the Xxxxxx Xxxxxx Entities, taken as a
whole, or subject the Partnership or the limited partners of the Partnership to
any material liability or disability; and none of the Xxxxxx Xxxxxx Entities is
aware of any existing, imminent or threatened labor disturbance by the employees
of any of its principal suppliers, manufacturers or contractors that could
result in a material adverse effect on the financial condition, results of
operations or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or
subject the Partnership to any material liability or disability;
(kk) None of the Xxxxxx Xxxxxx Entities has nor, to their knowledge,
has any employee or agent thereof made any payment of funds to any of the Xxxxxx
Xxxxxx Entities or received or retained any funds therefrom in violation of any
law, rule or regulation of a character required to be disclosed in the
Prospectus;
(ll) The Partnership maintains insurance with respect to its
properties and business of the types and in amounts generally deemed adequate
for its business and consistent with insurance coverage maintained by similar
companies and businesses, all of which insurance is in full force and effect;
(mm) Each of the Xxxxxx Xxxxxx Entities has filed all material
federal, state and foreign income and franchise tax returns and has paid all
taxes shown as due thereon, other than taxes which are being contested in good
faith and for which adequate reserves have been established in accordance with
generally accepted accounting principles ("GAAP"). There are no tax returns of
any of the Xxxxxx Xxxxxx Entities that are currently being audited by state,
local or federal taxing authorities or agencies (and with respect to which any
of the Xxxxxx Xxxxxx Entities has received notice), where the findings of such
audit, if adversely determined, would result in a material adverse effect on the
financial condition, results of operations or business of the Xxxxxx Xxxxxx
Entities, taken as a whole, or subject the Partnership to any material liability
or disability;
(nn) With respect to each employee benefit plan, program and
arrangement (including, without limitation, any "employee benefit plan" as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) maintained or contributed to by the Partnership, or with
respect to which the Partnership could incur any liability under ERISA
(collectively, the "Benefit Plans"), no event has occurred, in connection with
which the Partnership could be subject to any liability under the terms of such
Benefit Plan, applicable law (including, without limitation, ERISA and the
Internal Revenue Code of 1986, as amended) or any applicable agreement that
could materially adversely affect the financial condition, results of operations
or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or subject the
Partnership to any material liability or disability.
3. Upon the execution of the Pricing Agreement applicable to any Designated
Securities and authorization by the Representatives of the release of such
Designated Securities,
12
the several Underwriters propose to offer such Designated Securities for sale
upon the terms and conditions set forth in the Prospectus as amended or
supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant to
the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Partnership, shall be delivered by or on behalf of the Partnership to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by wire transfer of
Federal (same-day) funds to the account specified by the Partnership to the
Representatives at least forty-eight hours in advance or at such other place and
time and date as the Representatives and the Partnership may agree upon in
writing, such time and date being herein called the "Time of Delivery" for such
Securities.
5. Each of the Xxxxxx Xxxxxx Entities agrees with each of the Underwriters
of any Designated Securities:
(a) To prepare the Prospectus as amended or supplemented in rela-
tion to the applicable Designated Securities in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under the
Act not later than the Commission's close of business on the second business day
following the execution and delivery of the Pricing Agreement relating to the
applicable Designated Securities or, if applicable, such earlier time as may be
required by Rule 424(b); to make no further amendment or any supplement to the
Registration Statement or Prospectus as amended or supplemented after the date
of the Pricing Agreement relating to such Securities and prior to the Time of
Delivery for such Securities which shall be disapproved by the Representatives
for such Securities promptly after reasonable notice thereof; to advise the
Representatives promptly of any such amendment or supplement after such Time of
Delivery and furnish the Representatives with copies thereof; to file promptly
all reports and any definitive proxy or information statements required to be
filed by the Partnership with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act for so long as the delivery of a prospectus is
required in connection with the offering or sale of such Securities, and during
such same period to advise the Representatives, promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed with the Commission, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use of
any prospectus relating to the Securities, of the suspension of the
qualification of such Securities for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or suspending
the use of any prospectus relating to the Securities or suspending any such
qualification, to promptly use its best efforts to obtain the withdrawal of such
order;
(b) Promptly from time to time to take such action as the Represent-
atives may reasonably request to qualify such Securities for offering and sale
under the securities laws of such jurisdictions as the Representatives may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be
13
necessary to complete the distribution of such Securities, provided that in
connection therewith the Partnership shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in any
jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the New York Business
Day next succeeding the date of this Agreement and from time to time, to furnish
the Underwriters with copies of the Prospectus in New York City as amended or
supplemented in such quantities as the Representatives may reasonably request,
and, if the delivery of a prospectus is required at any time in connection with
the offering or sale of the Securities and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during such
same period to amend or supplement the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus in order to comply
with the Act, the Exchange Act or the Trust Indenture Act, to notify the
Representatives and upon their request to file such document and to prepare and
furnish without charge to each Underwriter and to any dealer in securities as
many copies as the Representatives may from time to time reasonably request of
an amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Partnership and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Partnership, Rule
158);
(e) During the period beginning from the date of the Pricing Agreement
for such Designated Securities and continuing to and including the later of (i)
the termination of trading restrictions for such Designated Securities, as
notified to the Partnership by the Representatives and (ii) the Time of Delivery
for such Designated Securities, not to offer, sell, contract to sell or
otherwise dispose of any debt securities of the Partnership which mature more
than one year after such Time of Delivery and which are substantially similar to
such Designated Securities, without the prior written consent of the
Representatives; and
(f) If the Partnership elects to rely upon Rule 462(b), the Partner-
ship shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of
this Agreement, and the Partnership shall at the time of filing either pay to
the Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Act.
6. The Xxxxxx Xxxxxx Entities covenant and agree with the several
Underwriters that the Xxxxxx Xxxxxx Entities will pay or cause to be paid the
following: (i) the fees, disbursements and expenses of the Partnership's counsel
and accountants in connection with the registration of the Securities under the
Act and all other expenses in connection with the
14
preparation, printing and filing of the Registration Statement, any Preliminary
Prospectus and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or producing any Agreement among Underwriters, this
Agreement, any Pricing Agreement, any Indenture, closing documents (including
any compilations thereof) and any other documents in connection with the
offering, purchase, sale and delivery of the Securities; (iii) any filing fees
and expenses in connection with the qualification of the Securities for offering
and sale under state securities laws as provided in Section 5(b) hereof,
including the fees and disbursements of counsel for the Underwriters in
connection with such qualification; (iv) any fees charged by securities rating
services for rating the Securities; (v) any filing fees incident to any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Securities; (vi) the cost of preparing the Securities; (vii) the
fees and expenses of any Trustee and any agent of any Trustee and the fees and
disbursements of counsel for any Trustee in connection with any Indenture and
the Securities; and (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, and Sections 8 and 11 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel,
transfer taxes on resale of any of the Securities by them, and any advertising
expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of each of the Xxxxxx Xxxxxx
Entities in or incorporated by reference in the Pricing Agreement relating to
such Designated Securities are, at and as of the Time of Delivery for such
Designated Securities, true and correct, the condition that each of the Xxxxxx
Xxxxxx Entities shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof; if the Partnership has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order suspending
the effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to the Representatives'
reasonable satisfaction;
(b) Xxxxxxx & Xxxxx L.L.P., counsel for the Underwriters, shall have
furnished to the Representatives such written opinion or opinions (a draft of
each such opinion is attached as Annex II(a) hereto), dated the Time of Delivery
for such Designated Securities, with respect to the matters covered in
paragraphs (i) (insofar as it relates to the due formation and good standing of
the Partnership in Delaware and the Partnership's power and authority to conduct
its business as described in the Registration Statement and the Prospectus, as
amended or supplemented), (v), (xi) (insofar as it relates to the statements set
forth in the Prospectus under
15
the caption "Underwriting"), (xiii) and (xxii) (insofar as it relates to the
Registration Statement and the Prospectus) of subsection (c) below and a letter
substantially similar to the letter required to be delivered by Xxxxxxxx &
Xxxxxx L.L.P. pursuant to subsection (c) below as well as such other related
matters as the Representatives may reasonably request, and such counsel shall
have received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Xxxxxxxx & Xxxxxx L.L.P., counsel for the Xxxxxx Xxxxxx Entities
shall have furnished to the Representatives their written opinion (a draft of
such opinion is attached as Annex II(b) hereto), dated the Time of Delivery for
such Designated Securities, in form and substance satisfactory to the
Representatives, to the effect that:
(i) Each of the Xxxxxx Xxxxxx Entities has been duly formed and
is validly existing and in good standing under the laws of the State
of Delaware and each Xxxxxx Xxxxxx Entity has the partnership or
corporate power and authority, as the case may be, to conduct its
business as described in the Registration Statement and the
Prospectus, as amended or supplemented. To the knowledge of such
counsel, each of the Xxxxxx Xxxxxx Entities is duly qualified to do
business and is in good standing as a foreign corporation or foreign
limited partnership, as the case may be, in all jurisdictions in which
the nature of the activities conducted by it or the character of the
assets owned or leased by it makes such licensing or qualification
necessary, except in the case where the failure to be so qualified
cannot reasonably be expected to have a material adverse effect on the
financial condition, results of operations or business of the Xxxxxx
Xxxxxx Entities, taken as a whole, or subject the Partnership or the
limited partners of the Partnership to any material liability or
disability;
(ii) The General Partner is the sole general partner of the
Partnership with a 1% general partner interest in the Partnership;
such general partner interest is duly authorized by the Partnership
Agreement and was validly issued to the General Partner; and, to the
knowledge of such counsel, the General Partner owns such general
partner interest free and clear of all liens, encumbrances, security
interests, equities, charges or claims (except for such liens,
encumbrances, security interests, equities, charges or claims as are
not, individually or in the aggregate, material or as described in the
Registration Statement or the Prospectus, as amended or supplemented);
(iii) The General Partner is the sole general partner of each of
the Operating Partnerships with a 1.0101% general partner interest in
each of the Operating Partnerships; such general partner interests are
duly authorized by the respective Operating Partnership Agreements and
were validly issued to the General Partner; and to the knowledge of
such counsel, the General Partner owns such general partner interests
free and clear of all liens, encumbrances, security interests,
equities charges or claims (except for such liens, encumbrances,
security interests, equities, charges or claims as are not,
individually or in the aggregate, material or as described in the
Registration Statement or the Prospectus, as amended or supplemented,
and except as provided in the Operating Partnership Agreements);
16
(iv) OLP-D is the sole general partner of SFPP with a 99.5%
general partner interest in SFPP; such general partner interest is
duly authorized by the SFPP Agreement and was validly issued to OLP-D;
and to the knowledge of such counsel, OLP-D owns such general partner
interest free and clear of all liens, encumbrances, security
interests, equities, charges or claims as are not, individually or in
the aggregate, material or as described in the Registration Statement
or the Prospectus, as amended or supplemented, or the OLP-D
Agreement); the SF Limited Partner is the sole limited partner of SFPP
with a 0.5% non-voting, limited partner interest in SFPP; and such
limited partner interest is duly authorized by the SFPP Agreement and
was validly issued to the SF Limited Partner;
(v) At the applicable Time of Delivery, to the knowledge of such
counsel, the capitalization of the Partnership will consist of ______
Common Units; to the knowledge of such counsel, such Common Units will
be the only limited partner interests of the Partnership that are
issued and outstanding at the applicable Time of Delivery; all of such
Common Units of the Partnership (including the Units being delivered
at such Time of Delivery) have been duly and validly authorized and
issued and are fully paid and non-assessable (except as such
nonassessability may be affected by certain provisions of the Delaware
Act); and the Units conform in all material respects to the
description thereof incorporated by reference in the Prospectus as
amended or supplemented;
(vi) The Partnership is the sole limited partner of each of the
Operating Partnerships with a 98.9899% limited partner interest in
each of the Operating Partnerships; such limited partnership
interests, in the case of each of the Operating Partnerships, are duly
authorized by the respective Operating Partnership Agreements, were
validly issued to the Partnership and are fully paid and
non-assessable (except as nonassessability may be affected by certain
provisions of the Delaware Act); and, to the knowledge of such
counsel, the Partnership owns such limited partner interests free and
clear of all liens, encumbrances, security interests, equities,
charges or claims (except for such liens, encumbrances, security
interests, equities, charges or claims (i) as are not, individually or
in the aggregate, material, (ii) as described in the Registration
Statement or the Prospectus, as amended or supplemented or (iii)
arising out of the pledge by the Partnership of the limited partner
interests of the Operating Partnerships to secure certain indebtedness
of the Partnership and OLP-B).
(vii) Based solely on such counsel's review of the stock transfer
records of KMNGL, OLP-A is the record owner of all of the issued and
outstanding capital stock of KMNGL Corp.; OLP-A is the record owner of
all of the issued and outstanding capital stock of XXXX Corp.; OLP-A
is the sole member of KM-LLC; all of such capital stock and such
member interests are duly authorized, validly issued, fully paid and
nonassessable; and, to the knowledge of such counsel, OLP-A owns all
of such capital stock and such member interests free and clear of all
liens, encumbrances, security interests, equities, charges or claims
(except for such liens, encumbrances, security interests, equities,
charges or claims as are not, individually or in the aggregate,
material or as described in the Registration Statement or the
Prospectus).
17
(viii)OLP-A is a general partner of Heartland with a ____%
general partner interest in Heartland, KMNGL Corp. is a general
partner of Mont Belvieu with a % general partner interest in Mont
Belvieu, and KM-LLC is a limited partner of Shell CO2, with a 20%
limited partner interest in Shell CO2; such general partner interests
and such limited partner interest are duly authorized by the
respective partnership agreements of Heartland, Mont Belvieu and Shell
CO2, and were validly issued by each of Heartland, Mont Belvieu and
Shell CO2, respectively, and in the case of such limited partner
interest, is fully paid and nonassessable (except as such
nonassessability may be affected by certain provisions of the Delaware
Act); and, OLP-A and KMNGL Corp. own such general partner interests in
Heartland and Mont Belvieu, respectively, and KM-LLC owns such limited
partner interest in Shell CO2, free and clear of all liens,
encumbrances, security interests, equities, charges or claims (except
for such liens, encumbrances, security interests, equities, charges or
claims as are not, individually or in the aggregate, material or as
described in the Registration Statement or the Prospectus);
(ix) No consent, approval, authorization, order, registration or
qualification of or with any federal, Delaware or New York court or
governmental agency or body is required under Federal or New York law
or the Delaware Act for the issue and sale of the Securities being
delivered at such Time of Delivery or the consummation by the
Partnership of the transactions contemplated by this Agreement, the
Pricing Agreement, the Securities or the Indenture, except such as
have been obtained under the Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws or the Trust Indenture Act or
by the Bylaws and rules of the National Association of Securities
Dealers, Inc. in connection with the purchase and distribution of the
Units by the Underwriters;
(x) To the knowledge of such counsel, any instrument, document,
lease, license or other agreement required to be described or referred
to in the Registration Statement or the Prospectus, as amended or
supplemented, has been described or referred to therein and any such
instrument, document, lease, license or other agreement required to be
filed as an exhibit to the Registration Statement has been filed as an
exhibit thereto or has been incorporated as an exhibit by reference in
the Registration Statement;
(xi) To the best of such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Xxxxxx Xxxxxx Entities or any of its
subsidiaries is a party or of which any property of the Xxxxxx Xxxxxx
Entities or any of its subsidiaries is the subject which, if
determined adversely to the Xxxxxx Xxxxxx Entities or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the current or future consolidated financial
position, unitholders' equity or results of operations of the Xxxxxx
Xxxxxx Entities and their subsidiaries; and, to the best of such
counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(xii) The issue and sale of the Designated Securities being
delivered at such Time of Delivery and the compliance by the Xxxxxx
Xxxxxx Entities with all of the
18
provisions of this Agreement and the consummation of the transactions
herein and therein contemplated will not (a) result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument filed as an exhibit to the
Registration Statement or filed as an exhibit to any document
incorporated by reference in the Registration Statement, (b) result in
any violation of the provisions of the Certificate of Incorporation,
by-laws or other formation document, as applicable, of any of the
Xxxxxx Xxxxxx Entities, Mont Belvieu, Heartland or Shell CO2, (c)
breach or otherwise violate an existing obligation of any of the
Xxxxxx Xxxxxx Entities under any court or administrative order,
judgment or decree of which such counsel has knowledge, or (d) violate
any applicable provisions of the federal laws of the United States,
the laws of the State of New York, or the Delaware Act;
(xiii)(A) The statements set forth in the Partnership's Annual
Report on Form 10-K for the year ended December 31, 1997 under the
caption "Item 1: Business-Regulation" and (B) the statements set forth
in the Prospectus under the captions "Description of Notes,"
"Description of Debt Securities," "Material Federal Income Tax
Considerations," and under the captions "Underwriting" and "Plan of
Distribution," insofar as they purport to constitute a summary of the
terms of the Designated Securities or describe the provisions of
federal law, New York law and the Delaware Act and documents referred
to therein, in each case, are accurate summaries and fairly and
correctly present in all material respects the information called for
with respect to such matters; provided, however, that such counsel's
opinion need not cover any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the
Partnership by an Underwriter through Xxxxxxx, Xxxxx & Co., expressly
for use therein;
(xiv) None of the Xxxxxx Xxxxxx Entities is (a) a "holding
company" or a "subsidiary company" of a "holding company" or an
"affiliate" thereof, within the meaning of the Public Utility Holding
Company Act of 1935, as amended, or (b) an "Investment Company" or an
entity "controlled" by an "Investment Company," as such terms are
defined in the Investment Company Act;
(xv) The Registration Statement was declared effective under the
Act by the Commission and to the knowledge of such counsel no order
suspending the effectiveness of the Registration Statement has been
issued and no proceeding for that purpose has been instituted or is
pending, threatened or contemplated. Any required filing of the
Prospectus relating the sale of the Designated Securities pursuant to
Rule 424(b) under the Act has been made in the manner and within the
time period required by such rule;
(xvi) This Agreement and the Pricing Agreement with respect to
the Designated Securities have been duly authorized, executed and
delivered by the Partnership;
(xvii)The Designated Securities have been duly authorized by the
Partnership, and when authenticated and issued in accordance with the
terms of the
19
Indenture and paid for by the Underwriters in accordance with the
terms of the Pricing Agreement will constitute valid and legally
binding obligations of the Partnership and the Guarantors entitled to
the benefits provided by the Indenture; and the Designated Securities
and the Indenture conform to the descriptions thereof in the
Prospectus as amended or supplemented;
(xviii) The Indenture has been duly authorized, executed and
delivered by the Partnership and each of the Guarantors and
constitutes a valid and legally binding instrument of the Partnership
and each of the Guarantors, enforceable against the Partnership and
each of the Guarantors in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights
and to general equity principles; and the Indenture has been duly
qualified under the Trust Indenture Act;
(xix) The Registration Statement and the Prospectus (including
any documents incorporated by reference in the Prospectus, when such
documents became effective or were filed with the Commission), as
amended or supplemented, comply in all material respects as to form
with the requirements of the Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder (other than
the financial statements and related schedules and other financial
data contained therein, as to which such counsel need express no
opinion).
Such counsel shall also deliver a letter to the effect that they have
participated in conferences with officers and other representatives of the
Partnership, representatives of the Partnership's accountants, representatives
of the Underwriters and counsel for the Underwriters, at which conferences the
contents of the Registration Statement and Prospectus and related matters were
discussed and, although such counsel is not passing on and does not assume any
responsibility for and shall not be deemed to have independently verified the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those referred to in the
opinion in subsection (xiii) of this Section 7(c), and relying as to facts
necessary to the determination as to materiality, to the extent such counsel may
do so in the exercise of its professional responsibility, upon statements of the
officers and other representatives of the Partnership, on the basis of the
foregoing, no facts have come to such counsel's attention that lead it to
believe that, as of its effective date, the Registration Statement or any
further amendment thereto made by the Partnership prior to such Time of Delivery
(other than the financial statements and related schedules and other financial
data contained therein, as to which such counsel need not comment) contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading;
or that, as of its date, the Prospectus as amended or supplemented or any
further amendment or supplement thereto made by the Partnership prior to such
Time of Delivery (other than the financial statements and related schedules and
other financial data contained
20
therein, as to which such counsel need not comment) contained an untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; or that, as of such Time of Delivery, either the
Registration Statement or the Prospectus as amended or supplemented or any
further amendment or supplement thereto made by the Partnership to such Time of
Delivery (other than the financial statements and related schedules and other
financial data contained therein, as to which such counsel need express no
opinion) contains an untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and such counsel have
no reason to believe that any documents incorporated by reference in the
Prospectus, when such documents became effective or were so filed, as the case
may be, contained, in the case of a registration statement which became
effective under the Act, an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or, in the case of other documents which were
filed under the Act or the Exchange Act with the Commission, an untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made when such documents were so filed, not misleading; and they do not
know of any contracts or other documents of a character required to be filed as
an exhibit to the Registration Statement or required to be incorporated by
reference into the Prospectus as amended or supplemented or required to be
described in the Registration Statement or the Prospectus as amended or
supplemented which are not filed or incorporated by reference or described as
required.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than federal law, New York law
and the Delaware Act.
(a) On the date of the Pricing Agreement for such Designated
Securities at a time prior to the execution of the Pricing Agreement with
respect to such Designated Securities and at each Time of Delivery for such
Designated Securities, the independent accountants of the Partnership who have
certified the financial statements of the Partnership and its subsidiaries
included or incorporated by reference in the Registration Statement shall have
furnished to the Representatives a letter, dated the effective date of the
Registration Statement or the date of the most recent report filed with the
Commission containing financial statements and incorporated by reference in the
Registration Statement, if the date of such report is later than such effective
date, and a letter dated such Time of Delivery, respectively, to the effect set
forth in Annex II hereto, and with respect to such letter dated such Time of
Delivery, as to such other matters as the Representatives may reasonably request
and in form and substance satisfactory to the Representatives (the executed copy
of the letter delivered prior to the execution of this Agreement is attached as
Annex I(a) hereto and a draft of the form of letter to be delivered on the
effective date of any post-effective amendment to the Registration Statement and
as of each Time of Delivery is attached as Annex I(b) hereto);
(b) (i) None of the Xxxxxx Xxxxxx Entities shall have sustained since
the date of the latest audited financial statements included or incorporated by
reference in the Prospectus as amended prior to the date of the Pricing
Agreement relating to the Designated Securities any loss or interference with
its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the Prospectus
as amended prior to the date of the Pricing Agreement relating to the Designated
Securities, and (ii) since the respective dates as of which information is given
in the Prospectus as amended prior to the date of the Pricing Agreement relating
to the Designated Securities there shall not have been any change in the capital
stock or long-term debt of the Partnership (or any of the other Xxxxxx Xxxxxx
Entities) or any change, or any development involving a prospective change, in
or affecting the general
21
affairs, management, financial position, unitholders' equity or results of
operations of the Partnership (or any of the other Xxxxxx Xxxxxx Entities),
otherwise than as set forth or contemplated in the Prospectus as amended prior
to the date of the Pricing Agreement relating to the Designated Securities, the
effect of which, in any such case described in Clause (i) or (ii), is in the
judgment of the Representatives so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Designated Securities on the terms and in the manner contemplated in the
Prospectus as first amended or supplemented relating to the Designated
Securities;
(c) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded any of the Xxxxxx Xxxxxx Entities debt securities or preferred stock by
any "nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act, and (ii)
no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
of the Partnership's debt securities or preferred stock;
(d) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following: (i) a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange; (ii) a suspension or material limitation in trading in the
Partnership's securities on the New York Stock Exchange; (iii) a general
moratorium on commercial banking activities declared by either Federal or New
York or Texas State authorities; or (iv) the outbreak or escalation of
hostilities involving the United States or the declaration by the United States
of a national emergency or war, if the effect of any such event specified in
this Clause (iv) in the judgment of the Representatives makes it impracticable
or inadvisable to proceed with the public offering or the delivery of the
Designated Securities on the terms and in the manner contemplated in the
Prospectus as first amended or supplemented relating to the Designated
Securities;
(e) The Partnership shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of the Pricing Agreement relating to
the Designated Securities; and
(f) The Xxxxxx Xxxxxx Entities shall have furnished or caused to be
furnished to the Representatives at the Time of Delivery for the Designated
Securities a certificate or certificates of officers of the General Partner
satisfactory to the Representatives as to the accuracy of the representations
and warranties of the Xxxxxx Xxxxxx Entities herein at and as of such Time of
Delivery, as to the performance by the Xxxxxx Xxxxxx Entities of all of its
obligations hereunder to be performed at or prior to such Time of Delivery, as
to the matters set forth in subsections (a) and (e) of this Section and as to
such other matters as the Representatives may reasonably request.
(g) Each of the Xxxxxx Xxxxxx Entities will indemnify and hold harm-
less each Underwriter against any losses, claims, damages or liabilities, joint
or several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus,
22
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating to the
Designated Securities, or any amendment or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Xxxxxx Xxxxxx Entities shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Designated
Securities, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Partnership by any
Underwriter of Designated Securities through the Representatives expressly for
use in the Prospectus as amended or supplemented relating to such Securities.
(h) Each Underwriter will indemnify and hold harmless the Xxxxxx
Xxxxxx Entities against any losses, claims, damages or liabilities to which the
Xxxxxx Xxxxxx Entities may become subject, under the Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Designated Securities, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Designated Securities, or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Partnership by such Underwriter through the Representatives expressly for use
therein; and will reimburse the Xxxxxx Xxxxxx Entities for any legal or other
expenses reasonably incurred by the Xxxxxx Xxxxxx Entities in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(i) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying
23
party shall not be liable to such indemnified party under such subsection for
any legal expenses of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party, in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(j) If the indemnification provided for in this Section 8 is unavail-
able to or insufficient to hold harmless an indemnified party under subsection
(a) or (b) above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the relative benefits
received by the Partnership on the one hand and the Underwriters of the
Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Partnership on the one hand
and the Underwriters of the Designated Securities on the other in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Partnership on
the one hand and such Underwriters on the other shall be deemed to be in the
same proportion as the total net proceeds from such offering (before deducting
expenses) received by the Partnership bear to the total underwriting discounts
and commissions received by such Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Partnership on the one
hand or such Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Xxxxxx Xxxxxx Entities and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this
subsection (d) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the applicable Designated Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages
24
which such Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The obligations of the Underwriters of
Designated Securities in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to such
Designated Securities and not joint.
(k) The obligations of the Xxxxxx Xxxxxx Entities under this Section
8 shall be in addition to any liability which the Xxxxxx Xxxxxx Entities may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the meaning of the Act; and
the obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
General Partner and to each person, if any, who controls the Xxxxxx Xxxxxx
Entities within the meaning of the Act.
(l) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Partnership
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the Representatives to
purchase such Designated Securities on such terms. In the event that, within the
respective prescribed period, the Representatives notify the Partnership that
they have so arranged for the purchase of such Designated Securities, or the
Partnership notifies the Representatives that it has so arranged for the
purchase of such Designated Securities, the Representatives or the Partnership
shall have the right to postpone the Time of Delivery for such Designated
Securities for a period of not more than seven days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement or the
Prospectus as amended or supplemented, or in any other documents or
arrangements, and the Partnership agrees to file promptly any amendments or
supplements to the Registration Statement or the Prospectus which in the opinion
of the Representatives may thereby be made necessary. The term "Underwriter" as
used in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to the Pricing
Agreement with respect to such Designated Securities.
(m) If, after giving effect to any arrangements for the purchase
of the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Partnership as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Partnership shall have the right to require
each non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter
25
agreed to purchase under such Pricing Agreement) of the Designated Securities of
such defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(n) If, after giving effect to any arrangements for the purchase
of the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Partnership as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subsection (b) above, or if the Partnership shall
not exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Designated Securities of a defaulting
Underwriter or Underwriters, then the Pricing Agreement relating to such
Designated Securities shall thereupon terminate, without liability on the part
of any non-defaulting Underwriter or the Partnership, except for the expenses to
be borne by the Partnership and the Underwriters as provided in Section 6 hereof
and the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
2. The respective indemnities, agreements, representations, warranties and
other statements of the Xxxxxx Xxxxxx Entities and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, any of
the Xxxxxx Xxxxxx Entities, or any officer or director or controlling person of
the Xxxxxx Xxxxxx Entities, and shall survive delivery of and payment for the
Designated Securities.
3. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Xxxxxx Xxxxxx Entities shall not then be under any liability to any
Underwriter with respect to the Designated Securities covered by such Pricing
Agreement except as provided in Sections 6 and 8 hereof; but, if for any other
reason Designated Securities are not delivered by or on behalf of the
Partnership as provided herein, the Xxxxxx Xxxxxx Entities will reimburse the
Underwriters through the Representatives for all out-of-pocket expenses approved
in writing by the Representatives, including fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations for the purchase,
sale and delivery of such Designated Securities, but the Xxxxxx Xxxxxx Entities
shall then be under no further liability to any Underwriter with respect to such
Designated Securities except as provided in Sections 6 and 8 hereof.
4. In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to any of the Xxxxxx Xxxxxx Entities shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
26
Partnership set forth in the Registration Statement: Attention: Secretary;
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
hereof shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Partnership by the Representatives upon request. Any such statements, requests,
notices or agreements shall take effect upon receipt thereof.
1. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, each of the Xxxxxx Xxxxxx
Entities and, to the extent provided in Sections 8 and 10 hereof, the officers
and directors of the General Partner and each person who controls the any of the
Xxxxxx Xxxxxx Entities or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement or any such
Pricing Agreement. No purchaser of any of the Securities from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
2. Time shall be of the essence of each Pricing Agreement. As used herein,
"business day" shall mean any day when the Commission's office in Washington,
D.C. is open for business.
3. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
4. This Agreement and each Pricing Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
27
If the foregoing is in accordance with your understanding, please sign and
return to us one for the Xxxxxx Xxxxxx Entities and for each of the
Representatives plus one for each counsel, counterparts hereof, and upon the
acceptance hereof by you, on behalf of each of the Underwriters, this letter and
such acceptance hereof shall constitute a binding agreement among each of the
Underwriters and each of the Xxxxxx Xxxxxx Entities. It is understood that your
acceptance of this letter on behalf of each of the Underwriters is pursuant to
the authority set forth in a form of Agreement among Underwriters, the form of
which shall be submitted to the Partnership for examination upon request, but
without warranty on your part as to the authority of the signers thereof.
Very truly yours,
XXXXXX XXXXXX ENERGY PARTNERS, L.P.
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
XXXXXX XXXXXX OPERATING L.P. "A"
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
XXXXXX XXXXXX OPERATING L.P. "B"
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
28
XXXXXX XXXXXX OPERATING L.P. "C"
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
XXXXXX XXXXXX OPERATING L.P. "D"
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
KINDER XXXXXX X.X., INC.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
SFPP, L.P.
By: Xxxxxx Xxxxxx Operating L.P., "D"
By: Xxxxxx Xxxxxx Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
29
XXXXXX XXXXXX BULK TERMINALS
CORPORATION
By: _______________________________
Name:
Title:
XXXXXX XXXXXX NATURAL GAS LIQUIDS
CORPORATION
By: _______________________________
Name:
Title:
XXXXXX XXXXXX CO(2), L.L.C.
By: Xxxxxx Xxxxxx Operating L.P., "A"
By: Xxxxxx Xxxxxx Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
Accepted as of the date hereof:
Xxxxxxx Sachs & Co.
[Co-Representative(s)]
By:_______________________________
(Xxxxxxx, Xxxxx & Co.)
30
ANNEX I
Pricing Agreement
Xxxxxxx, Sachs & Co., [Name(s) of Co-Representative(s)] As Representatives of
the several Underwriters named in Schedule I hereto, c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
_________, 19__
Ladies and Gentlemen:
Xxxxxx Xxxxxx Energy Partners, L.P., a Delaware limited partnership (the
"Partnership"), proposes, subject to the terms and conditions stated herein and
in the Underwriting Agreement, dated , 1998 (the "Underwriting Agreement"),
among the Partnership and the other Xxxxxx Xxxxxx Entities (as defined in the
Underwriting Agreement) on the one hand and Xxxxxxx, Sachs & Co. [and (names of
Co-Representatives named therein)] on the other hand, to issue and sell to the
Underwriters named in Schedule I hereto (the "Underwriters") the Securities
specified in Schedule II hereto (the "Designated Securities"). Each of the
provisions of the Underwriting Agreement is incorporated herein by reference in
its entirety, and shall be deemed to be a part of this Agreement to the same
extent as if such provisions had been set forth in full herein; and each of the
representations and warranties set forth therein shall be deemed to have been
made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Pricing
Agreement in relation to the Prospectus as amended or supplemented relating to
the Designated Securities which are the subject of this Pricing Agreement,
unless such representation or warranty is as of a specified date. Each reference
to the Representatives herein and in the provisions of the Underwriting
Agreement so incorporated by reference shall be deemed to refer to you. Unless
otherwise defined herein, terms defined in the Underwriting Agreement are used
herein as therein defined. The Representatives designated to act on behalf of
the Representatives and on behalf of each of the Underwriters of the Designated
Securities pursuant to Section 12 of the Underwriting Agreement and the address
of the Representatives referred to in such Section 12 are set forth at the end
of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Partnership agrees
to issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Partnership, at the time
and place and at the purchase price to the Underwriters set forth in Schedule II
hereto, the principal amount of Designated Securities set forth opposite the
name of such Underwriter in Schedule I hereto.
31
If the foregoing is in accordance with your understanding, please sign and
return to us one for the Partnership and each of the Representatives plus one
for each counsel counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Partnership. It is understood that your acceptance of this letter on
behalf of each of the Underwriters is or will be pursuant to the authority set
forth in a form of Agreement among Underwriters, the form of which shall be
submitted to the Partnership for examination upon request, but without warranty
on the part of the Representatives as to the authority of the signers thereof.
Very truly yours,
XXXXXX XXXXXX ENERGY PARTNERS, L.P.
By: Xxxxxx Xxxxxx, G.P., Inc.
By: ______________________________
Name:
Title:
XXXXXX XXXXXX OPERATING L.P. "A"
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
32
XXXXXX XXXXXX OPERATING L.P. "B"
By: Kinder Xxxxxx X.X., Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
XXXXXX XXXXXX OPERATING L.P. "C"
By: Kinder Xxxxxx X.X., Inc.
By: ______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
XXXXXX XXXXXX OPERATING L.P. "D"
By: Kinder Xxxxxx X.X., Inc.
By: ______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
KINDER XXXXXX X.X., INC.
By: ______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
33
SFPP, L.P.
By: Xxxxxx Xxxxxx Operating L.P., "D"
By: Xxxxxx Xxxxxx Inc.
By: ______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
XXXXXX XXXXXX BULK TERMINALS
CORPORATION
By: ______________________________
Name:
Title:
XXXXXX XXXXXX NATURAL GAS LIQUIDS
CORPORATION
By: _______________________________
Name:
Title:
XXXXXX XXXXXX CO(2), L.L.C.
By: Xxxxxx Xxxxxx Operating L.P., "A"
By: Xxxxxx Xxxxxx Inc.
By: _______________________________
Xxxxxxx X. Xxxxxx
Chairman of the Board and Chief
Executive Officer
34
Accepted as of the date hereof:
Xxxxxxx, Sachs & Co.
[Name(s) of Co-Representative(s)]
By: ____________________________
(Xxxxxxx, Xxxxx & Co.)
35
SCHEDULE I
Underwriter Principal Amount of Designated
Securities to be Purchased
Xxxxxxx, Sachs & Co. $
[Name(s) of Co-Representative(s)]
[Names of other Underwriters] $
--------
Total $
========
36
SCHEDULE II
Title of Designated Securities:
[ %] [Senior] [Subordinated] [Floating Rate] [Zero Coupon] [Notes] due
Aggregate principal amount:
[$]
Price to Public:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from _________ to _________ [including accrued amortization
[, if any,] from _________ to _________]
Purchase Price by Underwriters:
% of the principal amount of the Designated Securities, plus accrued interest
from _________to _________ [and accrued amortization[, if any,] from _________
to _________]
Form of Designated Securities:
[Definitive form to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery at the office of [The Depository
Trust Company or its designated custodian] [the Representatives]]
[Book-entry only form represented by one or more global securities
deposited with The Depository Trust Company ("DTC") or its designated custodian,
to be made available for checking by the Representatives at least twenty-four
hours prior to the Time of Delivery at the office of DTC.]
Specified funds for payment of purchase price:
Federal (same day) funds
Time of Delivery:
_________ a.m. (New York City time), _________, 199__
Indenture:
[Senior] [Subordinated] Indenture dated _________, 199__, among the
Partnership[, certain guarantors] and _________, as Trustee
37
Maturity:
Interest Rate:
[ %] [Zero Coupon] [See Floating Rate Provisions]
Interest Payment Dates:
[months and dates, commencing ______________, 199__]
Redemption Provisions:
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Partnership, in the
amount of [$ ] or an integral multiple thereof, [on or after _________,at the
following redemption prices (expressed in percentages of principal amount). If
[redeemed on or before _________, __%, and if] redeemed during the 12-month
period beginning _________,
Year Redemption Price
and thereafter at 100% of their principal amount, together in each case with
accrued interest to the redemption date.]
[on any interest payment date falling on or after , , at the election of
the Partnership, at a redemption price equal to the principal amount thereof,
plus accrued interest to the date of redemption.]]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
Sinking Fund Provisions:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund
to retire [$_________] principal amount of Designated Securities on _________ in
each of the years _________ through _________ at 100% of their principal amount
plus accrued interest[, together with [cumulative] [noncumulative] redemptions
at the option of the Partnership to retire an additional [$_________] principal
amount of Designated Securities in the years _________ through _________ at 100%
of their principal amount plus accrued interest.]
[If Designated Securities are extendable debt securities, insert--
38
Extendable provisions:
Designated Securities are repayable on _________, ______ [insert date and
years], at the option of the holder, at their principal amount with accrued
interest. The initial annual interest rate will be %, and thereafter the annual
interest rate will be adjusted on _________, _________and _________ to a rate
not less than ___% of the effective annual interest rate on U.S. Treasury
obligations with _________-year maturities as of the [insert date 15 days prior
to maturity date] prior to such [insert maturity date].]
[If Designated Securities are floating rate debt securities, insert--
Floating rate provisions:
Initial annual interest rate will be ___% through _________ [and
thereafter will be adjusted [monthly] [on each _________, _________, and
_________ ] [to an annual rate of ___% above the average rate for _________-year
[month][securities][certificates of deposit] issued by __________________ and
__________________ [insert names of banks].] [and the annual interest rate
[thereafter] [from _________ through _________] will be the interest yield
equivalent of the weekly average per annum market discount rate for
_________-month Treasury bills plus ___% of Interest Differential (the excess,
if any, of (i) the then current weekly average per annum secondary market yield
for-month certificates of deposit over (ii) the then current interest yield
equivalent of the weekly average per annum market discount rate for
_________-month Treasury bills); [from _________ and thereafter the rate will be
the then current interest yield equivalent plus ___% of Interest Differential].]
Defeasance provisions:
Closing location for delivery of Designated Securities:
Additional Closing Conditions:
Paragraph 7(g) of the Underwriting Agreement should be modified in the
event that the Securities are denominated in, indexed to, or principal or
interest are paid in, a currency other than the U.S. dollar, more than one
currency or in a composite currency. The country or countries issuing such
currency should be added to the banking moratorium and hostilities clauses and
the following additional clause should be added to the paragraph (the entire
paragraph should be restated, as amended):
"; ( ) the imposition of the proposal of exchange controls by any
governmental authority in [insert the country or countries issuing such
currency, currencies or composite currency]".
Names and addresses of Representatives:
Designated Representatives:
Address for Notices, etc.:
39
[Other Terms]* :
-----------------------
* A description of particular tax, accounting or other unusual features (such as
the addition of event risk provisions) of the Designated Securities should be
set forth, or referenced to an attached and accompanying description, if
necessary, to ensure agreement as to the terms of the Designated Securities to
be purchased and sold. Such a description might appropriately be in the form in
which such features will be described in the Prospectus Supplement for the
offering.
40
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Partnership and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Partnership for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been [separately] furnished to the representative or
representatives of the Underwriters (the "Representatives") such term to
include an Underwriter or Underwriters who act without any firm being
designated as its or their representatives [and are attached hereto];
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Partnership's quarterly report on Form 10-Q incorporated by
reference into the Prospectus as indicated in their reports thereon copies
of which [have been separately furnished to the Representatives][are
attached hereto]; and on the basis of specified procedures including
inquiries of officials of the Partnership who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and regulations,
nothing came to their attention that caused them to believe that the
unaudited condensed consolidated financial statements do not comply as to
form in all material respects with the applicable accounting requirements
of the Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the
Partnership for the five most recent fiscal years included in the
Prospectus and included or incorporated by reference in Item 6 of the
Partnership's Annual Report on Form 10-K for the most recent fiscal year
agrees with the corresponding amounts (after restatement where applicable)
in the audited consolidated financial statements for five such fiscal years
which were
1
included or incorporated by reference in the Partnership's Annual Reports
on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Partnership and its subsidiaries, inspection of
the minute books of the Partnership and its subsidiaries since the date of
the latest audited financial statements included or incorporated by
reference in the Prospectus, inquiries of officials of the Partnership and
its subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Partnership's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Partnership's Quarterly Reports on Form
10-Q incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Partnership's Annual Report on Form 10-K for the most recent fiscal
year;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in Clause (B) were not determined on a
basis substantially consistent with the basis for the audited
2
financial statements included or incorporated by reference in the
Partnership's Annual Report on Form 10-K for the most recent fiscal
year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and unit appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Partnership and its
subsidiaries, or any decreases in consolidated net current assets or
unitholders' equity or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in
each case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and
financial information specified by the Representatives which are derived
from the general accounting records of the Partnership and its
subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives or in
documents incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and
financial
3
information with the accounting records of the Partnership and its
subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
4
