WILLIAMS PARTNERS L.P. 5,000,000 Common Units Representing Limited Partner Interests UNDERWRITING AGREEMENT
Exhibit 1.1
XXXXXXXX PARTNERS L.P.
5,000,000 Common Units
Representing Limited Partner Interests
August [ ], 2005
Xxxxxx Brothers Inc.
As the Representative of the several
Underwriters named in Schedule 1
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As the Representative of the several
Underwriters named in Schedule 1
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Xxxxxxxx Partners L.P., a Delaware limited partnership (the “Partnership”), proposes to issue
and sell to the several Underwriters named in Schedule 1 hereto (the “Underwriters”)
5,000,000 common units (the “Firm Units”) representing limited partner interests in the Partnership
(the “Common Units”). Xxxxxx Brothers Inc. shall act as representative (the “Representative”) of
the several Underwriters.
In addition, certain holders of Common Units named in Schedule 2 attached hereto (the
“Selling Unitholders”) propose to grant to the Underwriters an option to purchase up to an
additional 750,000 Common Units on the terms and for the purposes set forth in Section 2
(the “Option Units”). The Firm Units and the Option Units, if purchased, are hereinafter
collectively called the “Units.” This is to confirm the agreement concerning the purchase of Units
from the Partnership and the Selling Unitholders by the Underwriters. Capitalized terms used but
not defined herein shall have the same meanings given them in the Partnership Agreement or the
Prospectus (each as defined herein).
It is understood and agreed to by all parties that the Partnership was formed to own, operate
and acquire the natural gas gathering, transportation and processing, and natural gas liquids
fractionation and storage, assets and business held by various subsidiaries of The Xxxxxxxx
Companies, Inc., a Delaware corporation (“Xxxxxxxx”), as described more particularly in the
Prospectus. Xxxxxxxx Partners GP LLC, a Delaware limited liability company, will serve as the
general partner (the “General Partner”) of the Partnership. As of the First Delivery Date (as
defined in Section 4), Xxxxxxxx Energy Services, LLC, a Delaware limited liability company
and a direct wholly owned subsidiary of Xxxxxxxx (“XXX”), will serve as the sole member of the
General Partner. Each of XXX, Xxxxxxxx Discovery Pipeline, LLC, a Delaware limited liability
company (“Xxxxxxxx Pipeline”), Xxxxxxxx Partners Holding LLC, a Delaware limited liability company
(“Holdings”), and Xxxxxxxx Energy, LLC, a Delaware limited liability company (“WE”), will be
limited partners of the Partnership.
Prior to the date hereof, the following transactions occurred:
(a) Xxxxxxxx Midstream Natural Gas Liquids, Inc., a Delaware corporation (“WMNGL”), conveyed
the Xxxxxx Storage East, Conway West and Xxxxxxxx storage assets, certain Xxxxxx real estate,
several easements and a letter of credit for storage abandonment to Mid-Continent Fractionation and
Storage, LLC, a Delaware limited liability company (“MCFS”), in exchange for a membership interest
in MCFS.
(b) Xxxxxxxx Natural Gas Liquids, Inc., a Delaware corporation (“WNGL”), conveyed a 50%
undivided interest in the Xxxxxx fractionator, all applicable contracts or agreements relating to
the contributed assets (including but not limited to the Xxxxxx fractionator operating agreement),
a fixed price gas purchase contract and certain Xxxxxx real estate to MCFS in exchange for a
membership interest in MCFS.
(c) Espagas USA, Inc., a Delaware corporation (“Espagas”), conveyed certain Xxxxxx real estate
to MCFS in exchange for a membership interest in MCFS.
(d) MAPCO Inc., a Delaware corporation (“MAPCO”), conveyed certain Xxxxxx real estate and a
VOP MEROX license agreement to MCFS in exchange for a membership interest in MCFS.
(e) XXX formed the General Partner under the terms of the Delaware Limited Liability Company
Act (the “Delaware LLC Act”), and contributed $1,000 in exchange for all of the membership
interests in the General Partner.
(f) The General Partner and XXX formed the Partnership, to which the General Partner
contributed $20 and XXX contributed $980 in exchange for a 2% general partner and 98% limited
partner interest, respectively.
(g) XXX acquired 100% of the membership interests in ENI British Borneo Pipeline LLC, a
Delaware limited liability company (“ENIBBP”). Upon acquisition, the legal name of ENIBBP was
changed to Xxxxxxxx Discovery Pipeline, LLC.
(h) The Partnership formed Xxxxxxxx Partners Operating LLC, a Delaware limited liability
company (“OLLC”), pursuant to the Delaware LLC Act and contributed $1,000 in exchange for all of
the membership interests in OLLC.
(i) [WNGL] formed Holdings pursuant to the Delaware LLC Act and contributed $1,000 in exchange
for all of the membership interests in Holdings.
(j) WMNGL, WNGL, Espagas and MAPCO contributed all of the outstanding membership interests in
MCFS to Holdings in exchange for the proportionate membership interests in Holdings.
(k) Xxxxxxxx Mobile Bay Producer Services, LLC, a Delaware limited liability company
(“WMBPS”), formed Carbonate Trend Pipeline LLC, a Delaware limited liability company (“CTP”),
pursuant to the Delaware LLC Act and contributed the Carbonate Trend Pipeline to CTP in exchange
for all of the membership interests in CTP.
2
(l) WMBPS distributed all of the membership interests in CTP to Arctic Fox Assets LLC, a
[Delaware] limited liability company (“AFA”).
(m) AFA distributed all of the outstanding membership interests in CTP to Xxxxxxxx, which in
turn contributed those membership interests to XXX.
(n) The Partnership, Xxxxxxxx and certain other Xxxxxxxx subsidiaries entered into an
amendment and restatement (the “Amended Credit Agreement”) of the Credit Agreement, dated as of May
3, 2004, by and among Xxxxxxxx, Northwest Pipeline Corporation and Transcontinental Gas Pipe Line
Corporation, as the borrowers, the lenders named therein, Citicorp USA, Inc., as administrative
agent and collateral agent, Citibank, N.A. and Bank of America, N.A., as the issuing banks, Bank of
America, N.A., as syndication agent, JPMorgan Chase Bank, N.A., the Bank of Nova Scotia and The
Royal Bank of Scotland PLC, as co-documentation agents, and Citigroup Global Markets Inc. and Banc
of America Securities LLC, as joint lead arrangers and co-book runners, to, among other things,
allow the Partnership to borrow up to $75 million under the Amended Credit Agreement for general
partnership purposes, including acquisitions.
The transactions described in clauses (a) – (n) above are referred to herein collectively as
the “Prior Transactions.”
In addition, on or prior to the First Delivery Date, the Partnership will enter into a working
capital loan agreement with Xxxxxxxx providing for a $20 million revolving credit facility (the
“Revolving Credit Agreement”).
On the First Delivery Date, XXX, the General Partner, the Partnership, OLLC, WE, Xxxxxxxx
Pipeline, Holdings, MCFS and CTP will enter into a Contribution, Conveyance and Assumption
Agreement (the “Contribution Agreement”) pursuant to which the following transactions will occur on
the First Delivery Date, unless otherwise noted:
(a) MCFS will distribute to Holdings cash, receivables and other working capital assets (“MCFS
Working Capital Assets”) estimated to be approximately $[ ] million.
(b) CTP will distribute to XXX xxxx, receivables and other working capital assets (“CTP
Working Capital Assets”) estimated to be approximately $[ ] million.
(c) XXX will contribute membership interests in CTP with an aggregate value equal to 2% of the
equity value of the Partnership to the General Partner as a capital contribution.
(d) The General Partner will contribute its membership interest in CTP to the Partnership in
exchange for (a) a continuation of its 2% general partner interest and (b) the Incentive
Distribution Rights (as defined in the Partnership Agreement (as defined in Section 1(f))).
(e) XXX will contribute its remaining membership interest in CTP to the Partnership in
exchange for (a) [ ] Common Units representing a
[ ] % limited partner interest in the
Partnership and (b) [ ] subordinated units representing limited partner interests in the
3
Partnership (“Subordinated Units”) representing a [ ] % limited partner interest in the
Partnership.
(f) WE will contribute to the Partnership a [ ] % membership interest (the “WE Discovery
Interest”) in Discovery Producer Services, LLC, a Delaware limited liability company (“DPS”), in
exchange for (y) [ ] Common Units representing a [ ] % limited partner interest in the
Partnership and
(z) [ ]
Subordinated Units representing a limited partner interest in
the Partnership.
(g) Xxxxxxxx Pipeline will contribute to the Partnership its [ ] % membership interest (the
“Xxxxxxxx Pipeline Discovery Interest”) in DPS in exchange for (y) [ ] Common Units
representing a [ ] % limited partner interest in the Partnership and (z) [ ] Subordinated
Units representing a [ ] % limited partner interest in the Partnership.
(h) Holdings will contribute all of the outstanding membership interests in MCFS to the
Partnership in exchange for (i) [ ] Common Units representing a [ ] % limited partner interest
in the Partnership and (ii) [ ] Subordinated Units representing a [ ]
limited partner
interest in the Partnership.
(i) The public, through the Underwriters, will contribute $[100.0] million (the “Offering
Proceeds”) to the Partnership in exchange for [ ] Common Units, representing limited partner
interests with an [ ] % limited partner interest in the Partnership.
(j) The Partnership will use the Offering Proceeds to (i) pay the underwriting discounts and
commissions, (ii) distribute $[35.0] million in cash to [XXX/Xxxxxxxx Pipeline] in reimbursement of
certain capital expenditures incurred prior to formation, (iii) distribute $[48.5] million in cash
to [any or all of the other transferors in the [Prior] Transactions], (iv) contribute $[1.6]
million in cash to MCFS and CTP as capital contributions to replenish working capital, (v) pay
approximately $[4.6] million in offering expenses incurred by the Partnership and (vi) provide
$[12.8] million of additional working capital.
(k) The Partnership will contribute its interests in MCFS, CTP and DPS to OLLC as a capital
contribution.
(l) The agreements of limited partnership and the limited liability company agreements of the
aforementioned entities will be amended and restated to the extent necessary to reflect the
foregoing transactions and any other transactions contemplated by the Contribution Agreement.
(m) If the Underwriters exercise their option to purchase any Option Units within 30 days
after the date of this Agreement as provided in Section 4, the Selling Unitholders will
sell the Option Units to the Underwriters at the price set forth in Section 3.
Each of MCFS, CTP, DPS and Discovery Gas Transmission LLC, a Delaware limited liability
company (“DGT”), is referred to herein, individually, as a “Subsidiary” and, collectively, as the
Subsidiaries.”
4
The transactions described above in clauses (a)-(m) above are referred to as the “Subsequent
Transactions” and, together with the Prior Transactions, are referred to as the “Transactions.”
The Partnership, the General Partner, OLLC and the Subsidiaries are sometimes referred to
herein collectively as the “Partnership Entities.” WNGL, WMNGL, WE, XXX, Holdings, Xxxxxxxx
Pipeline, the General Partner, the Partnership and OLLC are sometimes referred to herein
collectively as the “Xxxxxxxx Parties.” The Xxxxxxxx Parties, together with each of Xxxxxxxx,
WNGL, WMNGL, Espagas, MAPCO, WMBPS and AFA, are sometimes referred to herein collectively as the
“Xxxxxxxx Entities.”
This is to confirm the agreement concerning the purchase of the Firm Units and the Option
Units, if any, from the Partnership by the Underwriters.
Section 1.
Representations, Warranties and Agreements of the Xxxxxxxx
Parties.
The Xxxxxxxx Parties jointly and severally represent, warrant and agree that:
(a) A registration statement on Form S-1 (File No. 333-124517) with respect to the Units has
(i) been prepared by the Partnership in conformity with the requirements of the Securities Act of
1933, as amended (the “Securities Act”), and the rules and regulations (the “Rules and
Regulations”) of the Securities and Exchange Commission (the “Commission”) thereunder, (ii) been
filed with the Commission under the Securities Act and (iii) become effective under the Securities
Act. Copies of such registration statement and each of the amendments thereto have been delivered
by the Partnership to the Representative. As used in this Agreement, “Effective Time” means the
date and the time as of which such registration statement, or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission; “Effective Date” means the
date of the Effective Time; “Preliminary Prospectus” means each prospectus included in such
registration statement, or amendments thereto, before it became effective under the Securities Act
and any prospectus filed with the Commission by the Partnership with the consent of the
Representative pursuant to Rule 424(a) of the Rules and Regulations; “Registration Statement” means
such registration statement, as amended at the Effective Time, including all information contained
in the final prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations and deemed to be a part of the registration statement as of the Effective Time pursuant
to Rule 430A of the Rules and Regulations; and “Prospectus” means the prospectus as first filed
with the Commission pursuant to paragraphs (1) or (4) of Rule 424(b) of the Rules and Regulations.
If the Partnership has filed an abbreviated registration statement to register additional Common
Units pursuant to Rule 462(b) under the Securities Act (the “Rule 462 Registration Statement”),
then any reference herein to the term “Registration Statement” shall be deemed to include such Rule
462 Registration Statement. The Commission has not issued any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus or suspending the effectiveness of the
Registration Statement, and no proceeding for such purpose has been instituted or threatened by the
Commission.
(b) The Registration Statement conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement or the Prospectus will, when they
5
become effective or are filed with the Commission and on the applicable Delivery Date (as
defined in Section 5), as the case may be, conform in all material respects to the requirements of
the Securities Act and the Rules and Regulations 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 and as of the applicable Delivery 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 (in the case of the Prospectus, in light of the circumstances under which the statements
were made); and each of the statements made by the Partnership in the Registration Statement, and
to be made in the Prospectus and any further amendments or supplements to the Registration
Statement or Prospectus within the coverage of Rule 175(b) of the rules and regulations under the
Act, including (but not limited to) any statements with respect to estimated available cash, future
cash distributions of the Partnership and any statements made in support thereof or related thereto
under “Cash Distribution Policy” and “Cash Available to Pay Distributions” or the anticipated ratio
of taxable income to distributions was made or will be made with a reasonable basis and in good
faith. Notwithstanding the foregoing, no representation or warranty is made as to information
contained in or omitted from the Registration Statement or the Prospectus in reliance upon and in
conformity with information furnished to the Partnership in writing by or on behalf of any
Underwriter through the Representative expressly for inclusion therein, which information is
specified in Section 10(f).
(c) The Partnership has been duly formed and is validly existing in good standing as a limited
partnership under the Delaware Revised Uniform Limited Partnership Act (the “Delaware LP Act”), has
full partnership power and authority necessary to own or hold its properties and assets and to
conduct the businesses in which it is engaged, and is, or at each Delivery Date will be, duly
registered or qualified to do business as a foreign limited partnership in each jurisdiction listed
opposite its name in Annex I, such jurisdictions being the only jurisdictions in which its
ownership or lease of property or the conduct of its business requires such qualification, except
where the failure to so register or qualify could not reasonably be expected to (i) have a material
adverse effect on the condition (financial or otherwise), results of operations, securityholders’
equity, properties, business or prospects of the Partnership Entities, taken as a whole (a
“Material Adverse Effect”) or (ii) subject the limited partners of the Partnership to any material
liability or disability.
(d) Each of the General Partner, XXX, Holdings, WE, OLLC, MCFS, CTP, DPS and DGT has been duly
formed and is validly existing in good standing as a limited liability company under Delaware LLC
Act, has full limited liability company power and authority necessary to own or hold its properties
and to conduct the businesses in which it is engaged, and is, or at each Delivery Date will be,
duly registered or qualified to do business as a foreign limited liability company in each
jurisdiction listed opposite its name in Annex I, such jurisdictions being the only
jurisdictions in which its ownership or lease of property or the conduct of its business requires
such qualification, except where the failure to so register or qualify could not reasonably be
expected to (i) have a Material Adverse Effect or (ii) subject the limited partners of the
Partnership to any material liability or disability.
(e) Each of Xxxxxxxx, WNGL, WMNGL, MAPCO and Espagas has been duly incorporated and is validly
existing as a corporation in good standing under the DGCL, has full
6
corporate all power and authority necessary to own or hold its properties and to conduct the
businesses in which it is engaged, and is, or at each Delivery Date will be, duly qualified to do
business as a foreign corporation in each jurisdiction listed opposite its name in Annex I,
such jurisdictions being the only jurisdictions in which its ownership or lease of property or the
conduct of its businesses requires such qualification, except where the failure to so register or
qualify could not reasonably be expected to (i) have a Material Adverse Effect or (ii) subject the
limited partners of the Partnership to any material liability or disability.
(f) On the First Delivery Date, after giving effect to the Transactions, the General Partner
will be the sole general partner of the Partnership with an initial 2.0% general partner interest
in the Partnership; such general partner interest will be duly authorized and validly issued in
accordance with the Amended and Restated Agreement of Limited Partnership of the Partnership (as
the same may be amended and restated on or prior to the First Delivery Date, the “Partnership
Agreement”); and the General Partner will own such general partner interest free and clear of all
liens, encumbrances, security interests, charges or claims (collectively, “Liens”).
(g) On the First Delivery Date, after giving effect to the Transactions, XXX will own
[ ] Common Units and [ ] Subordinated Units (the “XXX Sponsor Units”), WE will own
[ ] Common Units and [ ] Subordinated Units (the “WE Sponsor Units”), Xxxxxxxx
Pipeline will own [ ] Common Units and [ ] Subordinated Units (the “Xxxxxxxx Pipeline
Sponsor Units”), Holdings will own [ ] Common Units and [ ] Subordinated Units (the
“Holdings Sponsor Units” and collectively with the XXX Sponsor Units, the WE Sponsor Units, the
Xxxxxxxx Pipeline Sponsor Units and the Holdings Sponsor Units, the “Sponsor Units”) and the
General Partner will own all of the Incentive Distribution Rights; on the First Delivery Date,
after giving effect to the Transactions, all of such Sponsor Units, the limited partner interests
represented thereby and the Incentive Distribution Rights will be duly authorized and validly
issued in accordance with the Partnership Agreement, and will be fully paid (to the extent required
under the Partnership Agreement) and non-assessable (except as such non-assessability may be
affected by (i) matters described in the Prospectus under the captions “The Partnership
Agreement—Limited Liability” and “Risk Factors—Risks Inherent in an Investment in Us—You may not
have limited liability if a court finds that unitholder action constitutes control of our business”
and (ii) Sections 17-303 and 17-607 of the Delaware LP Act); and XXX will own such XXX Sponsor
Units, WE will own such WE Sponsor Units, Xxxxxxxx Pipeline will own such Xxxxxxxx Pipeline Sponsor
Units, Holdings will own such Holdings Sponsor Units and the General Partner will own such
Incentive Distribution Rights, in each case, free and clear of all Liens (except, with respect to
the Sponsor Units and the Incentive Distribution Rights, restrictions on transferability contained
in the Partnership Agreement or as described in the Prospectus.
(h) On the respective Delivery Date, the Units to be issued and sold by the Partnership or the
Selling Unitholders, as applicable, to the Underwriters hereunder will have been duly authorized
and, when issued and delivered against payment therefor in accordance with this Agreement or the
Contribution Agreement, as applicable, will be validly issued, fully paid (to the extent required
under the Partnership Agreement) and non-assessable (except as such non-assessability may be
affected by (i) matters described in the Prospectus under the captions “The Partnership
Agreement—Limited Liability” and “Risk Factors—Risks Inherent in an Investment in Us—You may not
have limited liability if a court finds that unitholder action
7
constitutes control of our business” and (ii) Sections 17-303 and 17-607 of the Delaware LP
Act); the Units, when issued and delivered against payment therefor in accordance with this
Agreement or the Contribution Agreement, as applicable, the Sponsor Units and the Incentive
Distribution Rights, when issued and delivered in accordance with the terms of the Contribution
Agreement, will conform to the descriptions thereof contained in the Prospectus; and other than the
Sponsor Units owned by XXX, WE, Xxxxxxxx Pipeline and Holdings and the Incentive Distribution
Rights owned by the General Partner, the Units will be the only limited partner interests of the
Partnership issued and outstanding at each Delivery Date.
(i) On each Delivery Date, after giving effect to the Transactions, the Partnership will be
the sole member of OLLC with a 100% limited liability company interest in OLLC; such limited
liability company interest will have been duly authorized and validly issued in accordance with the
Limited Liability Company Agreement of OLLC (as the same may be amended and restated on or prior to
the First Delivery Date, the “OLLC Agreement”) and will be fully paid (to the extent required under
the OLLC Agreement) and non-assessable (except as such non-assessability may be affected by Section
18-607 of the Delaware LLC Act); and the Partnership will own such limited liability company
interest free and clear of all Liens.
(j) On each Delivery Date, after giving effect to the Transactions, OLLC will own a 100%
limited liability company interest in each of MCFS and CTP; such limited liability company
interests will be duly authorized and validly issued in accordance with the respective limited
liability company agreements of each of MCFS and CTP (as the same may be amended or restated on or
prior to the First Delivery Date, the “Wholly Owned Subsidiary LLC Agreements”), and will be fully
paid (to the extent required under the Wholly Owned Subsidiary LLC Agreements) and non-assessable
(except as such non-assessability may be affected by Section 18-607 of the Delaware LLC Act); and
OLLC will own such limited liability company interests free and clear of all Liens.
(k) On each Delivery Date, after giving effect to the Transactions, OLLC will own a 40%
limited liability company interest in DPS; such limited liability company interest will be duly
authorized and validly issued in accordance with the limited liability company agreement of DPS (as
such may be amended and restated on or prior to the First Delivery Date, the “DPS LLC Agreement”);
and OLLC will own such limited liability company interest free and clear of all Liens. DPS is the
sole member of DGT with a 100% limited liability company interest in DGT; such limited liability
company interest has been duly authorized and validly issued in accordance with the limited
liability company agreement of DGT (as the same may be amended or restated on or prior to the First
Delivery Date (the “DGT LLC Agreement”), and together with the DPS LLC Agreement and the Wholly
Owned Subsidiary LLC Agreements, the “Subsidiary LLC Agreements”) and is fully paid (to the extent
required under the DGT LLC Agreement) and non-assessable (except as such non-assessability may be
affected by Section 18-607 of the Delaware LLC Act); and DPS owns such limited liability company
interest free and clear of all Liens.
(l) Other than (i) the General Partner’s ownership of an initial 2.0% general partner interest
in the Partnership and its ownership of the Incentive Distribution Rights, (ii) the Partnership’s
ownership of a 100% limited liability company interest in OLLC, (iii) OLLC’s ownership of a 100%
limited liability company interest in each of MCFS and CTP, (iv) OLLC’s
8
ownership of a 40% limited liability company interest in DPS and (v) DPS’ 100% limited
liability company interest in DGT, on each Delivery Date, after giving effect to the Transactions,
none of the Partnership Entities will own, directly or indirectly, any equity or long-term debt
securities of any corporation, partnership, limited liability company, joint venture, association
or other entity; and none of the entities mentioned in the preceding clauses (i) through (v), other
than OLLC, MCFS, CTP [and DPS] is a “significant subsidiary” of the Partnership as such term is
defined in Rule 405 of the Rules and Regulations.
(m) On each Delivery Date, after giving effect to the Transactions, XXX will own a 100%
limited liability company interest in the General Partner; such limited liability company interest
will have been duly authorized and validly issued in accordance with the limited liability
agreement of the General Partner (as the same may be amended or restated on or prior to the First
Delivery Date, the “GP LLC Agreement”), and will be fully paid (to the extent required under the GP
LLC Agreement) and non-assessable (except as such non-assessability may be affected by Section
18-607 of the Delaware LLC Act); and XXX will own such limited liability company interest free and
clear of all Liens.
(n) Xxxxxxxx indirectly owns 100% of the issued and outstanding capital stock of each of WNGL
and WMNGL; all of such capital stock has been duly authorized and validly issued and is fully paid
and non-assessable; and Xxxxxxxx owns such capital stock free and clear of all Liens.
(o) Xxxxxxxx owns a 100% limited liability company interest in XXX; such limited liability
company interest has been duly authorized and validly issued in accordance with the limited
liability company agreement of XXX (as the same may be amended or restated on or prior to the First
Delivery Date, the “XXX LLC Agreement”) and is fully paid (to the extent required under the XXX LLC
Agreement) and non-assessable (except as such non-assessability may be affected by Section 18-607
of the Delaware LLC Act); and Xxxxxxxx owns such limited liability company interest free and clear
of all Liens.
(p) On the First Delivery Date, after giving effect to the Transactions, XXX will own a 100%
limited liability company interest in Xxxxxxxx Pipeline; such limited liability company interest
will be duly authorized and validly issued in accordance with the limited liability company
agreement of Xxxxxxxx Pipeline (as the same may be amended or restated on or prior to the First
Delivery Date, the “Xxxxxxxx Pipeline LLC Agreement”) and will be fully paid (to the extent
required under the Xxxxxxxx Pipeline LLC Agreement) and non-assessable (except as such
non-assessability may be affected by Section 18-607 of the Delaware LLC Act); and XXX will own such
limited liability company interest free and clear of all Liens.
(q) On the First Delivery Date, after giving effect to the Transactions, XXX will own 100% of
the issued and outstanding capital stock of each of MAPCO and Espagas; all of such capital stock
will be duly authorized and validly issued and will be fully paid and non-assessable; and XXX will
own such capital stock free and clear of all Liens.
(r) On the First Delivery Date, after giving effect to the Transactions, MAPCO will own a 100%
limited liability company interest in WE; such limited liability company interest will be duly
authorized and validly issued in accordance with the limited liability company
9
agreement of WE (as the same may be amended or restated on or prior to the First Delivery
Date, the “WE LLC Agreement”) and will be fully paid (to the extent required under the WE LLC
Agreement) and non-assessable (except as such non-assessability may be affected by Section 18-607
of the Delaware LLC Act); and MAPCO will own such limited liability company interest free and clear
of all Liens.
(s) On the First Delivery Date, after giving effect to the Transactions, WE will own a 26.7%
limited liability company interest in DPS; such membership interest will be duly and validly issued
in accordance with the DPS LLC Agreement and will be fully paid (to the extent required under the
DPS LLC Agreement) and nonassessable (except as such nonassessability may be affected by Section
18-607 of the Delaware LLC Act); and WE will own such limited liability company interest free and
clear of all Liens.
(t) On the First Delivery Date, after giving effect to the Transactions, Espagas will own a [
]% limited liability company interest in Holdings, WNGL will own a [ ]% limited
liability company interest in Holdings, WMNGL will own a [ ]% limited liability company
interest in Holdings, and MAPCO will own a [ ]% limited liability company interest in
Holdings; such limited liability company interests will have been duly authorized and validly
issued in accordance with the limited liability agreement of Holdings (as the same may be amended
or restated on or prior to the First Delivery Date, the “Holdings LLC Agreement”), and will be
fully paid (to the extent required under the Holdings LLC Agreement) and non-assessable (except as
such non-assessability may be affected by Section 18-607 of the Delaware LLC Act); and each of
Espagas, WNGL, WMNGL and MAPCO will own such limited liability company interests free and clear of
all Liens.
(u) Except as described in the Prospectus, there are no preemptive rights or other rights to
subscribe for or to purchase, nor any restriction upon the voting or transfer of, (i) any limited
partner interests in the Partnership or (ii) any member interests in the General Partner, OLLC or,
except as provided in the DPS LLC Agreement and the DGT LLC Agreement, any of the Subsidiaries, in
each case pursuant to the Partnership Agreement, the OLLC Agreement, the GP LLC Agreement or the
Subsidiary LLC Agreements, each as amended or restated on or prior to the First Delivery Date
(collectively, the “Organizational Documents”), or any other agreement or instrument to which any
of such entities is a party or by which any one of them may be bound. Except as described in the
Prospectus, there are no outstanding options or warrants to purchase (A) any Common Units or
Subordinated Units or other interests in the Partnership or (B) any interests in the General
Partner, OLLC or the Subsidiaries.
(v) None of the Partnership Entities has sold or issued any securities that would be
integrated with the offering of the Units contemplated by this Agreement pursuant to the Securities
Act, the Rules and Regulations or the interpretations thereof by the Commission.
(w) The Partnership has all requisite power and authority to issue, sell and deliver (i) the
Units, in accordance with and upon the terms and conditions set forth in this Agreement, the
Partnership Agreement, the Registration Statement and the Prospectus and (ii) the Sponsor Units and
the Incentive Distribution Rights, in accordance with and upon the terms and conditions set forth
in the Partnership Agreement and the Contribution Agreement. On each Delivery Date, all corporate,
partnership and limited liability company action, as the case may
10
be, required to be taken by the Xxxxxxxx Entities or any of their stockholders, members or
partners for the authorization, issuance, sale and delivery of the Units, the Sponsor Units and the
Incentive Distribution Rights, the execution and delivery by the Xxxxxxxx Entities of the Operative
Agreements (as defined in Section 1(x)) and the consummation of the transactions (including
the Transactions) contemplated by this Agreement and the Operative Agreements, shall have been
validly taken.
(x) This Agreement has been duly and validly authorized, executed and delivered by each of the
Xxxxxxxx Parties.
(y) On or before the First Delivery Date:
(i) The Partnership Agreement will have been duly authorized, executed and delivered by
the General Partner and the organizational limited partner named therein (the
“Organizational Limited Partner”) and will be a valid and legally binding agreement of the
General Partner and the Organizational Limited Partner, enforceable against the General
Partner and the Organizational Limited Partner in accordance with its terms;
(ii) The Contribution Agreement will have been duly authorized, executed and delivered
by the Xxxxxxxx Entities party thereto, and will be valid and legally binding agreements of
the Xxxxxxxx Entities party thereto, enforceable against such parties in accordance with its
terms;
(iii) The OLLC Agreement will have been duly authorized, executed and delivered by the
Partnership and will be a valid and legally binding agreement of the Partnership,
enforceable against the Partnership in accordance with its terms;
(iv) The GP LLC Agreement will have been duly authorized, executed and delivered by
XXX, and will be a valid and legally binding agreement of XXX, enforceable against XXX in
accordance with its terms;
(v) Each of the MCFS LLC Agreement and the CTP LLC Agreements will have been duly
authorized, executed and delivered by OLLC, and each will be a valid and legally binding
agreement of OLLC, enforceable against OLLC in accordance with its terms;
(vi) The DPS LLC Agreement has been duly authorized, executed and delivered by each of
OLLC and WE and, assuming due authorization, execution and delivery by Duke Energy Field
Services, LP (“DEFS”), will be a valid and legally binding agreement of OLLC, WE and DEFS,
enforceable against each of them in accordance with its terms;
(vii) An omnibus agreement (the “Omnibus Agreement”) will have been duly authorized,
executed and delivered by each of XXX, WE, [Xxxxxxxx Information Services Corporation,]
Xxxxxxxx Pipeline, Holdings, the General Partner, the Partnership and OLLC and will be a
valid and legally binding agreement of each of them, enforceable against each of them in
accordance with its terms; and
11
(viii) Each of the Amended Credit Agreement and the Revolving Credit Agreement will
have been duly authorized, executed and delivered by the Partnership and will be valid and
legally binding agreements of the Partnership, enforceable against the Partnership in
accordance with its terms.
provided that, with respect to each agreement described in this Section 1(y), the
enforceability thereof may be limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws relating to or affecting creditors’ rights generally
and by general principles of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law); and provided, further, that the indemnity, contribution and
exoneration provisions contained in any of such agreements may be limited by applicable laws and
public policy. The Organizational Documents, the Amended Credit Agreement, the Revolving Credit
Agreement, the Contribution Agreement and the Omnibus Agreement are herein collectively referred to
as the “Operative Agreements.”
(z) None of the offering, issuance and sale by the Partnership of the Units and the
application of the net proceeds therefrom as described under “Use of Proceeds” in the Prospectus,
the execution, delivery and performance of this Agreement or the Operative Agreements by the
Xxxxxxxx Entities that are parties thereto, or the consummation of the transactions contemplated
hereby and thereby (including the Transactions) (i) conflicts or will conflict with or constitutes
or will constitute a violation of the agreement of limited partnership, limited liability company
agreement, certificate or articles of incorporation or bylaws or other organizational documents of
any of the Xxxxxxxx Entities, (ii) conflicts or will conflict with or constitutes or will
constitute a breach or violation of, or a default under (or an event which, with notice or lapse of
time or both, would constitute such an event), any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which any of the Xxxxxxxx Entities is a party
or by which any of them or any of their respective properties may be bound, (iii) violates or will
violate any statute, law or regulation or any order, judgment, decree or injunction of any court or
governmental agency or body directed to any of the Xxxxxxxx Entities or any of their properties in
a proceeding to which any of them or their property is a party or (iv) will result in the creation
or imposition of any Lien upon any property or assets of any of the Xxxxxxxx Entities, which
conflicts, breaches, violations, defaults or Liens, in the case of clauses (ii), (iii) or (iv),
would, individually or in the aggregate, have a Material Adverse Effect.
(aa) Except for the registration of the Units under the Securities Act and such consents,
approvals, authorizations, registrations or qualifications as may be required under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and applicable state securities laws in
connection with the purchase and sale of the Units by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any court or governmental agency or body
having jurisdiction over the any of the Xxxxxxxx Entities or any of their properties or assets is
required for the execution, delivery and performance of this Agreement by the Xxxxxxxx Parties and
the consummation of the transactions contemplated hereby and the application of the proceeds from
the sale of Units as described under “Use of Proceeds” in the Prospectus.
(bb) Except as described in the Prospectus and the Partnership Agreement, there are no
contracts, agreements or understandings between the any of the Xxxxxxxx Entities and any person
12
granting such person the right to require the Partnership to file a registration statement
under the Securities Act with respect to any securities of the Partnership Entities owned or to be
owned by such person or to require the Partnership to include such securities in the Units
registered pursuant to the Registration Statement or in any securities being registered pursuant to
any other registration statement filed by any of the Partnership Entities under the Securities Act.
(cc) None of the Partnership Entities has sustained, since the date of the latest audited
financial statements included in the Prospectus (exclusive of any amendment or supplement thereto
after the date hereof), 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; and, since such date, except as described in the Prospectus, there has not been any
change in the capitalization or long-term debt of any of the Partnership Entities or any adverse
change, or any development involving a prospective adverse change, in or affecting the condition
(financial or otherwise), results of operations, securityholders’ equity, properties, management,
business or prospects of any of the Partnership Entities, in each case except as could not
reasonably be expected to have a Material Adverse Effect.
(dd) At March 31, 2005, the Partnership would have had, on the consolidated pro forma basis
indicated in the Prospectus (and any amendment or supplement thereto), a capitalization as set
forth therein. The historical financial statements (including the related notes and supporting
schedules) included in the Registration Statement and the Prospectus (and any amendment or
supplement thereto) comply as to form in all material respects with the requirements of Regulation
S-X under the Securities Act and present fairly in all material respects the financial position,
results of operations and cash flows of the entities purported to be shown thereby on the basis
stated therein at the respective dates or for the respective periods to which they apply and have
been prepared in accordance with accounting principles generally accepted in the United States
consistently applied throughout the periods involved. The selected historical and pro forma
financial and operating information set forth in the Registration Statement and the Prospectus (and
any amendment or supplement thereto) under the caption “Selected Historical and Pro Forma Combined
Financial and Operating Data” is accurately presented in all material respects and prepared on a
basis consistent with the audited and unaudited historical consolidated financial statements and
pro forma financial statements, as applicable, from which it has been derived. The pro forma
financial statements of the Partnership included in the Registration Statement and the Prospectus
(and any amendment or supplement thereto) comply as to form in all material respects with the
requirements of Article 11 of Regulation S-X under the Securities Act; such pro forma financial
statements have been properly compiled on the bases described therein; the assumptions used in the
preparation of such pro forma financial statements are, in the opinion of the management of the
General Partner, reasonable; and the pro forma adjustments reflected in such pro forma financial
statements are appropriate to give effect to the transactions and circumstances referred to
therein.
(ee) Ernst & Young LLP, who has certified certain financial statements of the Partnership, the
General Partner, the Xxxxxxxx Partners Predecessor (as defined therein) and DPS, whose reports
appear in the Prospectus and who have delivered the initial letter referred to in Section
9(j) hereof, are an independent registered public accounting firm with respect to the
13
Partnership, the General Partner and the Xxxxxxxx Partners Predecessor as required by the
Securities Act and the Rules and Regulations.
(ff) On each Delivery Date, after giving effect to the Transactions, each of the Partnership
Entities will have good and indefeasible title in fee simple to all real property and good and
marketable title to all personal property, contemplated as owned or to be owned by any of them in
the Operative Agreements or the Prospectus, in each case free and clear of all liens, claims,
security interests, encumbrances and other defects, except (i) such as are described in the
Prospectus or (ii) such as [do not materially affect the value of such property and] do not
materially interfere with the use made in the past and proposed to be made in the future of such
property as described in the Prospectus; provided, that, with respect to title to pipeline
rights-of-way, the Xxxxxxxx Parties represent that (A) no Xxxxxxxx Entity has received any actual
notice or claim from any owner of land upon which any pipeline that will be owned by any Subsidiary
as of the First Delivery Date as described in the Prospectus is located that such Xxxxxxxx Entity
does not have sufficient title to enable it to use and occupy the pipeline rights-of-way as they
have been used and occupied in the past and are proposed to be used and occupied in the future as
described in the Prospectus and (B) any lack of title to the pipeline rights-of-way that will have
a material adverse effect on the ability of any Subsidiary to use and occupy the pipeline
rights-of-way as they have been used and occupied in the past and are proposed to be used and
occupied in the future as described in the Prospectus will be subject to the indemnification
provisions of Section [ ] of the Omnibus Agreement. All assets held under lease or license by
the Partnership Entities are held under valid, subsisting and enforceable leases or licenses, with
such exceptions as are not material and do not materially interfere with the use made in the past
and proposed to be made in the future of such assets by the Partnership Entities as described in
the Prospectus. As of the First Delivery Date, the Contribution Agreement will be legally
sufficient to transfer to or vest in OLLC and the Subsidiaries all properties that are,
individually or in the aggregate, required to enable OLLC and the Subsidiaries to conduct their
operations (in all material respects as contemplated by the Prospectus), subject to the conditions,
reservations and limitations contained in the Contribution Agreement. OLLC and the Subsidiaries,
upon execution and delivery of the Contribution Agreement, succeeded or will succeed in all
material respects to the business, assets, properties, liabilities and operations reflected in the
pro forma financial statements of the Partnership included in the Prospectus, except as disclosed
in the Prospectus and in the Contribution Agreement.
(gg) Each of the Partnership Entities carry, or are covered by, insurance from insurers of
recognized financial responsibility in such amounts and covering such risks as is adequate for the
conduct of their respective businesses and the value of their respective properties and as is
customary for companies engaged in similar businesses in similar industries. All policies of
insurance of each of the Partnership Entities are in full force and effect on the date hereof; each
of the Partnership Entities are in compliance with the terms of such policies in all material
respects as of the date hereof; and none of the Partnership Entities has received notice from any
insurer or agent of such insurer that capital improvements or other expenditures will have to be
made in order to continue such insurance.
(hh) On each Delivery Date, after giving effect to the Transactions, each of the Partnership
Entities will own or possess adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service xxxx
14
registrations, copyrights, licenses and know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or procedures) necessary for
the conduct of their respective businesses and none of the Xxxxxxxx Entities has any reason to
believe that the conduct of their respective businesses will conflict with, and have not received
any notice of any claim of conflict with, any such rights of others.
(ii) Except as described in the Prospectus, there are no legal or governmental proceedings
pending to which any of the Partnership Entities is a party or of which any of their property or
assets to be owned or leased as of the applicable Delivery Date is the subject that could
reasonably be expected to have a Material Adverse Effect or could reasonably be expected to have a
material adverse effect on the performance of this Agreement or the consummation of the
transactions contemplated hereby or that are required to be described in the Registration Statement
or Prospectus but are not described as required; and to the knowledge of the Xxxxxxxx Parties, no
such proceedings are threatened by governmental authorities or by others.
(jj) There are no contracts or other documents that are required to be described in the
Prospectus or filed as exhibits to the Registration Statement by the Securities Act or by the Rules
and Regulations that have not been described in the Prospectus or filed as exhibits to the
Registration Statement; and the statements set forth in the Prospectus under the captions
“Conflicts of Interest and Fiduciary Duties,” “Prospectus Summary—The Offering,” “How We Make Cash
Distributions,” “Description of the Common Units,” “Description of the Subordinated Units” and “The
Partnership Agreement,” insofar as they purport to constitute a summary of the terms of the Common
Units and the Subordinated Units, and under the caption “Material Tax Consequences,” insofar as
they purport to describe the provisions of the laws and documents referred to therein, are fair
summaries in all material respects.
(kk) Except as described in the Prospectus, no labor disturbance by the employees of any of
the Partnership Entities (and to the extent they perform services on behalf of any of the
Partnership Entities, employees of any of the Xxxxxxxx Entities other than the Partnership
Entities), exists or, to the knowledge of the Xxxxxxxx Parties, is imminent or threatened, which
might be expected to have a Material Adverse Effect.
(ll) Each of the Xxxxxxxx Parties has filed all federal, state and local income and franchise
tax returns required to be filed through the date hereof, subject to permitted extensions, and has
paid all taxes shown to be due thereon, and no tax deficiency has been determined adversely to any
of the Xxxxxxxx Entities, nor do any of the Xxxxxxxx Entities have any knowledge of any tax
deficiency that could reasonably be expected to have a Material Adverse Effect.
(mm) Since the date as of which information is given in the Prospectus through the date
hereof, and except with respect to the Amended Credit Agreement or the Revolving Credit Agreement
or as may otherwise be disclosed in the Prospectus (exclusive of any amendment or supplement
thereto after the date hereof), none of the Partnership Entities have (i) issued or granted any
securities, other than those issued in the Prior Transactions, (ii) incurred any liability or
obligation, direct or contingent, other than liabilities and obligations which were incurred in the
ordinary course of business or (iii) entered into any transaction not in the ordinary course of
business.
15
(nn) The sale and issuance of the Sponsor Units to each of XXX, WE, Xxxxxxxx Pipeline and
Holdings and the Incentive Distribution Rights to the General Partner pursuant to the Partnership
Agreement are exempt from the registration requirements of the Act and the securities laws of any
state having jurisdiction with respect thereto, and none of the Partnership Entities has taken or
will take any action that would cause the loss of such exemption.
(oo) Each of the Partnership Entities (i) makes and keeps books and records which, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of assets and
(ii) maintains a system of internal accounting controls sufficient to provide reasonable assurance
that (A) transactions are executed in accordance with management’s general or specific
authorizations, (B) transactions are recorded as necessary to permit preparation of the
Partnership’s financial statements in conformity with accounting principles generally accepted in
the United States and to maintain accountability for its assets, (C) access to the Partnership’s
assets is permitted only in accordance with management’s general or specific authorization and (D)
the recorded accountability for the Partnership’s assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any differences.
(pp) (i) Each of the Partnership Entities has established and maintains disclosure controls
and procedures (as such term is defined in Rule 13a-15 under the Exchange Act), (ii) such
disclosure controls and procedures are designed to ensure that the information required to be
disclosed by the Partnership in the reports its files or submits under the Exchange Act is
accumulated and communicated to the management of the Partnership Entities, including their
respective principal executive officers and principal financial officers, as appropriate, to allow
timely decisions regarding required disclosure to be made and (iii) such disclosure controls and
procedures are effective in all material respects to perform the functions for which they were
established.
(qq) Since the date of the most recent audited balance sheet of the Partnership reviewed or
audited by Ernst and Young LLP and the audit committee of the board of directors of the General
Partner, (i) none of the Partnership Entities has been advised of (A) any significant deficiencies
in the design or operation of internal controls that could adversely affect the ability of the
Partnership Entities to record, process, summarize and report financial data, or any material
weaknesses in internal controls and (B) any fraud, whether or not material, that involves
management or other employees who have a significant role in the internal controls of the
Partnership Entities, and (ii) since that date, there have been no significant changes in internal
controls or in other factors that could significantly affect internal controls, including any
corrective actions with regard to significant deficiencies and material weaknesses.
(rr) Except as described in the Prospectus, no relationship, direct or indirect, exists
between or among the Partnership Entities, on the one hand, and the directors, officers,
securityholders, customers or suppliers of the Partnership Entities, on the other hand, that is
required to be described in the Prospectus which is not so described. No Partnership Entity has,
in violation of the Xxxxxxxx-Xxxxx Act of 2002, directly or indirectly, extended or maintained
credit, or arranged for the extension of credit, or renewed or amended any extension of credit, in
the form of a personal loan to or for any of its directors or executive officers.
16
(ss) The Partnership is in compliance in all material respects with the applicable
requirements of the Xxxxxxxx-Xxxxx Act of 2002.
(tt) None of the Partnership Entities, XXX, WE, Xxxxxxxx Pipeline or Holdings (i) is in
violation of its certificate or agreement of limited partnership, certificate of formation or
limited liability company agreement, certificate or articles of incorporation or bylaws or other
organizational documents; (ii) is in breach or default in any material respect, and no event has
occurred which, with notice or lapse of time or both, would constitute such a breach or default, in
the due performance or observance of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is subject, (iii) is in violation
of any statute or any order, rule or regulation of any court or governmental agency or body having
jurisdiction over its property or assets or (iv) has failed to obtain any license, permit,
certificate, franchise or other governmental authorization or permit necessary to the ownership of
its property or to the conduct of its business, except in the case of clauses (ii), (iii) and (iv)
as could not reasonably be expected to have a Material Adverse Effect.
(uu) None of the Xxxxxxxx Parties, nor any director, officer, agent, employee or other person
associated with or acting on behalf of any of the Xxxxxxxx Parties, has used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful expense relating to political
activity; made any direct or indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; violated or is in violation of any provision of the
Foreign Corrupt Practices Act of 1977; or made any bribe, rebate, payoff, influence payment,
kickback or other unlawful payment.
(vv) Except as described in the Prospectus, the Xxxxxxxx Entities (i) are, and at all times
prior were in compliance with any and all applicable federal, state and local laws and regulations
relating to the protection of health and human safety, the environment or natural resources or
imposing liability or standards of conduct concerning any Hazardous Materials (as defined below)
(“Environmental Laws”), (ii) have received and maintained all permits required of them under
applicable Environmental Laws to conduct their respective businesses, (iii) are in compliance with
all terms and conditions of any such permits and (iv) do not have any liability in connection with
the release into the environment of any Hazardous Material, except where such noncompliance with
Environmental Laws, failure to receive and maintain required permits, failure to comply with the
terms and conditions of such permits or liability in connection with such releases could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The
term “Hazardous Materials” means (A) any “hazardous substance” as defined in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended (“CERCLA”), (B) any
“hazardous waste” as defined in 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. None of the Partnership Entities has been
named as a “potentially responsible party” under CERCLA or any other similar Environmental Law,
except with respect to any matters that, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. Except as described in the Prospectus, (A) none of the
Partnership Entities is a party to any proceeding under Environmental Laws in which a governmental
17
authority is also a party, other than such proceedings in which it is believed that no
monetary penalties of $100,000 or more will be imposed, and (B) none of the Partnership Entities
anticipates material capital expenditures relating to Environmental Laws.
(ww) As of each Delivery Date, and after giving effect to the Transactions, each Partnership
Entity will be in compliance in all material respects with all presently applicable provisions of
the Employee Retirement Income Security Act of 1974, as amended, including the regulations and
published interpretations thereunder (“ERISA”); no “reportable event” (as defined in ERISA) has
occurred with respect to any “pension plan” (as defined in ERISA) for which any Partnership Entity
(after giving effect to the Transactions) would have any liability, excluding any reportable event
for which a waiver could apply; no Partnership Entity (after giving effect to the Transactions)
expects to incur liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any “pension plan” or (ii) Sections 412 or 4971 of the Internal Revenue Code of
1986, as amended, including the regulations and published interpretations thereunder (the “Code”);
and each “pension plan” for which any Partnership Entity would have any liability that is intended
to be qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether
by action or by failure to act, which could reasonably be expected to cause the loss of such
qualification.
(xx) Each of the Partnership Entities has, or at each Delivery Date will have, such permits,
consents, licenses, franchises, certificates and authorizations of governmental or regulatory
authorities (“permits”) as are necessary to own or lease its properties and to conduct its business
in the manner described in the Prospectus, subject to such qualifications as may be set forth in
the Prospectus and except for such permits that, if not obtained, could not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect; except as described in the
Prospectus, each of the Partnership Entities has, or at each Delivery Date will have, fulfilled and
performed all its material obligations with respect to such permits that are or will be due to have
been fulfilled and performed by such date; and no event has occurred that would prevent the permits
from being renewed or reissued or that allows, or after notice or lapse of time would allow,
revocation or termination thereof or results or would result in any impairment of the rights of the
holder of any such permit, except for such non-renewals, non-issues, revocations, terminations and
impairments that could not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(yy) None of the Partnership Entities are or, as of each Delivery Date after giving effect to
the Transactions and the application of the net proceeds therefrom as described under the caption
“Use of Proceeds” in the Prospectus, will be, (i) an “investment company” as defined in the
Investment Company Act of 1940, as amended or (ii) a “public utility company,” “holding company” or
a “subsidiary company” of a “holding company” under the Public Utility Holding Company Act of 1935,
as amended.
(zz) None of the Directed Units distributed in connection with the Directed Unit Program (each
as defined in Section 4) will be offered or sold outside of the United States, [except to
employees of Xxxxxxxx who are United States citizens].
(aaa) None of the Xxxxxxxx Entities has distributed and, prior to the later to occur of (i)
the First Delivery Date and (ii) completion of the distribution of the Units, will not distribute
any
18
offering material in connection with the offering and sale of the Units other than the
Registration Statement, the Preliminary Prospectus and the Prospectus or other materials, if any,
permitted by the Securities Act, including Rule 134 of the Rules and Regulations and, in connection
with the Directed Unit Program described in Section 4, the enrollment materials prepared by
Xxxxxx Brothers Inc.
(bbb) None of the Xxxxxxxx Entities has taken, nor will it take, directly or indirectly, any
action designed to or that has constituted or that could reasonably be expected to cause or result
in the stabilization or manipulation of the price of the Common Units to facilitate the sale or
resale of the Units.
(ccc) The Units have been approved for listing on the New York Stock Exchange, Inc. (the
“NYSE”), subject only to official notice of issuance.
(ddd) Except for this Agreement and any engagement letters with Xxxxxx Brothers Inc., there
are no contracts, agreements or understandings between the Partnership and any person that would
give rise to a valid claim against the Partnership or any Underwriter for a brokerage commission,
finder’s fee or other like payment in connection with the offering and sale of the Units
contemplated by this Agreement.
(eee) The statistical and market-related data included in the Prospectus and the Registration
Statement are based on or derived from sources that the Partnership Entities believe to be reliable
and accurate.
Each certificate signed by or on behalf of any of the Partnership Entities and delivered to
the Underwriters or counsel for the Underwriters pursuant to this Agreement shall be deemed to be a
representation and warranty by each such Partnership Entity to the Underwriters as to the matters
covered thereby.
Section 2. Representations, Warranties and Agreements of the Selling Unitholders.
Each Selling Unitholder, jointly and severally represents, warrants and agrees that:
(a) The Selling Unitholders have, and immediately prior to the Second Delivery Date the
Selling Unitholders will have, good and valid title to, or a valid “security entitlement” within
the meaning of Section 8-501 of the New York Uniform Commercial Code (the “UCC”) in respect of, the
Option Units to be sold by the Selling Unitholders hereunder, free and clear of all Liens;
(b) Upon payment for the Units to be sold by the Selling Unitholders, delivery of such Option
Units, as directed by the Underwriters, to Cede & Co. (“Cede”) or such other nominee as may be
designated by The Depository Trust Company (“DTC”), registration of such Option Units in the name
of Cede or such other nominee and the crediting of such Option Units on the books of DTC to
securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter has
notice of any adverse claim (within the meaning of Section 8-105 of the UCC to such Stock), (i) DTC
shall be a “protected purchaser” of such Option Units within the meaning of Section 8-303 of the
UCC, (ii) under Section 8-501 of the UCC, the Underwriters will acquire a valid security
entitlement in respect of such Option Units and (iii) no action based
19
on any “adverse claim”, within the meaning of Section 8-102 of the UCC, to such Option Units
may be asserted against the Underwriters with respect to such security entitlement. For purposes
of this representation, the Selling Unitholders may assume that when such payment, delivery and
crediting occur, (A) such Option Units will have been registered in the name of Cede or another
nominee designated by DTC, in each case on the Partnership’s share registry in accordance with the
Partnership Agreement and applicable law, (B) DTC will be registered as a “clearing corporation”
within the meaning of Section 8-102 of the UCC and (C) appropriate entries to the accounts of the
several Underwriters on the records of DTC will have been made pursuant to the UCC.
(c) Each Selling Unitholder has full right and limited liability company power and authority
to enter into this Agreement. The execution, delivery and performance of this Agreement by the
Selling Unitholders and the consummation by the Selling Unitholders of the transactions
contemplated hereby do not and will not (i) 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, license or other agreement or instrument to which any Selling Unitholder is
a party or by which any Selling Unitholder is bound or to which any of the property or assets of
the Selling Unitholders is subject (ii) result in any violation of the provisions of the
certificate of formation, limited liability company agreement (or similar organizational documents)
of any Selling Unitholder or (iii) result in any violation of any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over any Selling
Unitholder or the property or assets of any Selling Unitholder.
(d) Except for the registration of the Option Units under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may be required under the
Exchange Act and applicable state or foreign securities laws in connection with the purchase and
sale of the Option Units by the Underwriters, no consent, approval, authorization or order of, or
filing or registration with, any court or governmental agency or body having jurisdiction over any
Selling Unitholder or the property or assets of any Selling Unitholder is required for the
execution, delivery and performance of this Agreement by any Selling Unitholder and the
consummation by any Selling Unitholder of the transactions contemplated hereby.
(e) This Agreement has been duly and validly authorized, executed and delivered by or on
behalf of each Selling Unitholder.
(f) The Selling Unitholders have not taken and will not take, directly or indirectly, any
action that is designed to or which has constituted or which could reasonably be expected to cause
or result in the stabilization or manipulation of the price of any security of the Partnership to
facilitate the sale or resale of the Common Units.
Any certificate signed by any officer of any Selling Unitholder and delivered to the
Representative or counsel for the Underwriters in connection with the offering of the Units shall
be deemed a representation and warranty by such Selling Unitholder, as to matters covered thereby,
to each Underwriter.
Section 3. Purchase of the Units by the Underwriters.
20
On the basis of the representations and warranties contained in and subject to the terms and
conditions of this Agreement, the Partnership agrees to sell the Firm Units to the several
Underwriters and each of the Underwriters, severally and not jointly, agrees to purchase the number
of Firm Units set forth opposite that Underwriter’s name in Schedule 1 hereto. The
respective purchase obligations of the Underwriters with respect to the Firm Units shall be rounded
among the Underwriters to avoid fractional Common Units, as the Representative may determine.
In addition, the Selling Unitholders grant to the Underwriters an option to purchase up to
that number of Option Units set forth opposite such Selling Unitholder’s name in Schedule 2
hereto, severally and not jointly. Such option (the “Option”) is granted for the purpose of
covering sales of Common Units in excess of the total number of Firm Units and is exercisable as
provided in Section 5 hereof. Each Underwriter agrees, severally and not jointly, to
purchase the number of Option Units (subject to such adjustments to eliminate fractional Common
Units as the Representative may determine) that bears the same proportion to the total number of
Option Units to be sold on such Delivery Date as the number of Firm Units set forth in Schedule
1 hereto opposite the name of such Underwriter bears to the total number of Firm Units.
The price of both the Firm Units and
any Option Units shall be $[ ] per Common Unit.
Neither the Partnership nor the Selling Unitholders shall be obligated to deliver any of the
Units to be delivered on any Delivery Date (as hereinafter defined), except upon payment for all
the Units to be purchased on such Delivery Date as provided herein.
Section 4. Offering of Units by the Underwriters.
Upon authorization by the Representative of the release of the Firm Units, the several
Underwriters propose to offer the Firm Units for sale upon the terms and conditions set forth in
the Prospectus.
It is understood that approximately [350,000] of the Firm Units (the “Directed Units”) will
initially be reserved by the several Underwriters for offer and sale upon the terms and conditions
set forth in the Prospectus and in accordance with the rules and regulations of the National
Association of Securities Dealers, Inc. (the “NASD”) to employees of the Xxxxxxxx Entities and
persons having business relationships with the Xxxxxxxx Entities (each, a “Directed Unit
Participant”) who have heretofore delivered to Xxxxxx Brothers Inc. offers or indications of
interest to purchase Firm Units in form satisfactory to Xxxxxx Brothers Inc. (such program, the
“Directed Unit Program”) and that any allocation of such Directed Units among such persons will be
made in accordance with timely directions received by Xxxxxx Brothers Inc. from the Partnership;
provided, that under no circumstances will Xxxxxx Brothers Inc. or any Underwriter be liable to the
Partnership or to any such person for any action taken or omitted to be taken in good faith in
connection with such Directed Unit Program. It is further understood that any such Firm Units that
are not purchased by such persons will be offered by the Underwriters to the public upon the terms
and conditions set forth in the Prospectus.
21
The Partnership agrees to pay all fees and disbursements incurred by the Underwriters in
connection with the Directed Unit Program and any stamp duties or other taxes incurred by the
Underwriters in connection with the Directed Unit Program.
Section 5. Delivery of and Payment for the Units.
Delivery of and payment for the Firm Units shall be made at the offices of Xxxxxxx Xxxxx LLP,
000 Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000 at 9:00 A.M., Houston, Texas time, on the fourth full
business day following the date of this Agreement or at such other date or place as shall be
determined by agreement between the Representative and the Partnership. This date and time are
sometimes referred to as the “First Delivery Date.” On the First Delivery Date, the Partnership
shall deliver or cause to be delivered the Firm Units to the Representative for the account of each
Underwriter in book entry form through the facilities of DTC against payment to or upon the order
of the Partnership of the purchase price by wire transfer in immediately available funds to the
accounts specified by the Partnership. Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the obligation of each
Underwriter hereunder.
The Option granted in Section 3 will expire 30 days after the date of this Agreement
and may be exercised in whole or in part from time to time by written notice being given to the
Selling Unitholders by the Representative; provided that if such date falls on a day that is not a
business day, the Option granted in Section 3 will expire on the next succeeding business
day. Such notice shall set forth the aggregate number of Option Units as to which the Option is
being exercised, the names in which the Option Units are to be registered, the denominations in
which the Option Units are to be issued and the date and time, as determined by the Representative,
when the Option Units are to be delivered; provided, however, that this date and time shall not be
earlier than the First Delivery Date nor earlier than the second business day after the date on
which the Option shall have been exercised nor later than the fifth business day after the date on
which the Option shall have been exercised. The date and time the Option Units are delivered are
sometimes referred to as a “Second Delivery Date” and the First Delivery Date and any Second
Delivery Date are sometimes each referred to as a “Delivery Date.”
Delivery of and payment for the Option Units shall be made at the place specified in the first
sentence of the first paragraph of this Section 5 (or at such other place as shall be
determined by agreement between the Representative and the Selling Unitholders) at 9:00 A.M.,
Houston, Texas time, on such Second Delivery Date. On such Second Delivery Date, the Selling
Unitholders shall deliver or cause to be delivered the Option Units to the Representative for the
account of each Underwriter in book entry form through the facilities of The Depository Trust
Company against payment to or upon the order of the Selling Unitholders of the purchase price by
wire transfer in immediately available funds to the accounts specified by the Selling Unitholders.
Time shall be of the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter hereunder.
Section 6.
Further Agreements of the Xxxxxxxx Parties.
Each of the Xxxxxxxx Parties, jointly and separately, covenants and agrees with each
Underwriter:
22
(a) (i) To prepare the Prospectus in a form approved by the Representative and to file such
Prospectus pursuant to Rule 424(b) under the Securities Act not later than Commission’s close of
business on the second business day following the execution and delivery of this Agreement or, if
applicable, such earlier time as may be required by Rule 430A(a)(3) under the Securities Act; (ii)
to make no further amendment or any supplement to the Registration Statement or to the Prospectus
except as permitted herein; (iii) to advise the Representative, 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 and to
furnish the Representative with copies thereof; (iv) to advise the Representative, promptly after
it receives notice thereof, of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the Prospectus, of the suspension
of the qualification of the Units 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 the Prospectus or for additional
information; and, (v) in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to the Representative and to counsel for the Underwriters a signed
copy of the Registration Statement as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representative such number of the following documents as the
Representative shall reasonably request: (i) conformed copies of the Registration Statement as
originally filed with the Commission and each amendment thereto (in each case excluding exhibits)
and (ii) each Preliminary Prospectus, the Prospectus and any amended or supplemented Prospectus;
and, if the delivery of a prospectus is required at any time after the Effective Time in connection
with the offering or sale of the Units or any other securities relating thereto and if at such time
any events 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 to amend or supplement the Prospectus in order to comply with the Securities Act, to
notify the Representative and, upon its request, to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as the Representative may from time to
time reasonably request of an amended or supplemented Prospectus which will correct such statement
or omission or effect such compliance;
(d) To file promptly with the Commission any amendment to the Registration Statement or the
Prospectus or any supplement to the Prospectus that may, in the reasonable judgment of the
Partnership or the Representative, be required by the Securities Act or requested by the
Commission;
23
(e) The Partnership will not (i) file any amendment to the Registration Statement or make any
amendment or supplement to the Prospectus of which the Representative shall not previously have
been advised or to which the Representative or its counsel shall reasonably object in writing after
being so advised or (ii) so long as, in the opinion of counsel for the Underwriters, a Prospectus
is required to be delivered in connection with sales by any Underwriter or dealer, file any
information, documents or reports pursuant to the Exchange Act without delivering a copy of such
information, documents or reports to the Representative prior to or concurrently with such filing;
(f) As soon as practicable after the Effective Date, to make generally available to the
Partnership’s security holders and to deliver to the Representative an earnings statement of the
Partnership and its subsidiaries (which need not be audited) complying with Section 11(a) of the
Securities Act and the Rules and Regulations (including, at the option of the Partnership, Rule
158);
(g) For a period of two years following the Effective Date, to furnish or to make available
via the Commission’s Electronic Data Gathering, Analysis and Retrieval (XXXXX) System to the
Representative a copy of all materials furnished by the Partnership to its unitholders (excluding
any periodic income tax reporting materials) and all public reports and all reports and financial
statements furnished by the Partnership to the principal national securities exchange or automated
quotation system upon which the Units may be listed pursuant to requirements of or agreements with
such exchange or to the Commission pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(h) Promptly from time to time to take such action as the Representative may reasonably
request to qualify the Units for offering and sale under the securities laws of such jurisdictions
as the Representative 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 necessary to complete the
distribution of the Units; provided that in connection therewith the Partnership shall not be
required to qualify as a foreign limited partnership, to file a general consent to service of
process or subject itself to taxation in any jurisdiction;
(i) For a period of 180 days from the date of the Prospectus (the “Lock-Up Period”), not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to, result in the disposition by
any person at any time in the future of) any Common Units or securities convertible into or
exchangeable for Common Units (other than Common Units issued pursuant to employee benefit plans,
qualified unit option plans or other employee compensation plans existing on the date hereof or
pursuant to currently outstanding options, warrants or rights), or sell or grant options, rights or
warrants with respect to any Common Units or securities convertible into or exchangeable for Common
Units (other than the grant of options pursuant to option plans existing on the date hereof), or
(2) enter into any swap or other derivatives transaction that transfers to another, in whole or in
part, any of the economic benefits or risks of ownership of such Common Units, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of Common Units or
other securities, in cash or otherwise, in each case without the prior written consent of the
Representative on behalf of the Underwriters, other than in connection with the public offering
contemplated hereby.
24
The General Partner shall cause each person
or entity listed on Schedule 3 to furnish to the Representative, prior to the First
Delivery Date, a letter or letters, substantially in the form of Exhibit A hereto (each, a
“Lock-Up Agreement”).
Notwithstanding the foregoing paragraph, if (1) during the last 17 days of the Lock-Up Period,
the Partnership issues an earnings release or material news or a material event relating to the
Partnership occurs or (2) prior to the expiration of the Lock-Up Period, the Partnership announces
that it will release earnings results during the 16-day period beginning on the last day of the
Lock-Up Period, then the restrictions imposed in the preceding paragraph shall continue to apply
until the expiration of the 18-day period beginning on the issuance of the earnings release or the
announcement of the material news or the occurrence of the material event, unless the
Representative, on behalf of the Underwriters, waives such extension in writing;
(j) To apply the net proceeds from the offering of the Units as set forth in the Prospectus;
and
(k) To take such steps as shall be necessary to ensure that none of the Partnership Entities
shall become an “investment company” as defined in the Investment Company Act of 1940, as amended;
and
(l) In connection with the Directed Unit Program, to ensure that the Directed Units will be
restricted to the extent required by the NASD or the rules of such association from sale, transfer,
assignment, pledge or hypothecation for a period of three months following the date of the
effectiveness of the Registration Statement, and the Representative will notify the Partnership as
to which Directed Unit Participants will need to be so restricted. At the request of the
Representative, the Partnership will direct the transfer agent to place stop transfer restrictions
upon such securities for such period of time.
Section 7.
Further Agreements of the Selling Unitholders.
Each Selling Unitholder agrees:
(a) During the Lock-Up Period, not to, directly or indirectly, (1) offer for sale, sell,
pledge or otherwise dispose of (or enter into any transaction or device that is designed to, or
could be expected to, result in the disposition by any person at any time in the future of) any
Common Units or securities convertible into or exchangeable for Common Units (other than the Option
Units), (2) enter into any swap or other derivatives transaction that transfers to another, in
whole or in part, any of the economic benefits or risks of ownership of such shares of Common
Units, whether any such transaction described in clause (1) or (2) above is to be settled by
delivery of Common Units or other securities, in cash or otherwise, (3) cause to be filed a
registration statement with respect to any shares of Common Units or securities convertible,
exercisable or exchangeable into Common Units or any other securities of the Partnership or (4)
publicly disclose the intention to do any of the foregoing, in each case without the prior written
consent of the Representative, on behalf of the Underwriters.
Notwithstanding the foregoing paragraph, if (1) during the last 17 days of the Lock-Up Period,
the Partnership issues an earnings release or material news or a material event relating to the
Partnership occurs or (2) prior to the expiration of the Lock-Up Period, the Partnership
25
announces that it will release earnings results during the 16-day period beginning on the last
day of the Lock-Up Period, then the restrictions imposed in the preceding paragraph shall continue
to apply until the expiration of the 18-day period beginning on the issuance of the earnings
release or the announcement of the material news or the occurrence of the material event, unless
Xxxxxx Brothers Inc., on behalf of the Underwriters, waives such extension in writing. The Selling
Unitholders hereby further agree that, prior to engaging in any transaction or taking any other
action that is subject to the terms of this provision during the period from the date of this
Agreement to and including the 34th day following the expiration of the Lock-Up Period,
it will give notice thereof to the Partnership and will not consummate such transaction or take any
such action unless it has received written confirmation from the Partnership that the Lock-Up
Period (as such may have been extended pursuant to this paragraph) has expired.
(b) That the Option Units to be sold by the Selling Unitholders hereunder is subject to the
interest of the Underwriters and that the obligations of the Selling Unitholders hereunder shall
not be terminated by any act of the Selling Unitholders, by operation of law or the occurrence of
any other event.
(c) To deliver to the Representative prior to the Initial Delivery Date a properly completed
and executed United States Treasury Department Form W-9.
Section 8. Expenses.
The Xxxxxxxx Parties agree, whether or not the transactions contemplated by the Agreement are
consummated or this Agreement is terminated, to pay all costs, expenses, fees and taxes incident to
and in connection with (a) the authorization, issuance, sale and delivery of the Units and any
stamp duties or other taxes payable in that connection, and the preparation and printing of
certificates for the Units; (b) the preparation, printing and filing under the Securities Act of
the Registration Statement and any amendments and exhibits thereto, any Preliminary Prospectus, the
Prospectus and any amendment or supplement to the Prospectus; (c) the distribution of the
Registration Statement as originally filed and each amendment thereto and any post-effective
amendments thereto (including, in each case, exhibits), any Preliminary Prospectus, the Prospectus
and any amendment or supplement to the Prospectus, all as provided in this Agreement; (d) the
production and distribution of this Agreement, any supplemental agreement among the Underwriters
and any other related documents in connection with the offering, purchase, sale and delivery of the
Units; (e) any required review by the NASD of the terms of sale of the Units (including related
fees and expenses of counsel to the Underwriters); (f) the listing of the Units on the NYSE; (g)
the qualification of the Units under the securities laws of the several jurisdictions as provided
in Section 5(h) and the preparation, printing and distribution of a Blue Sky Memorandum
(including related fees and expenses of counsel to the Underwriters); (h) the offer and sale of the
Units by the Underwriters in connection with the Directed Unit Program (including the related fees
and expenses of counsel to the Underwriters), the costs and expenses of preparation, printing and
distribution of the Directed Unit Program material and all stamp duties or other taxes incurred by
the Underwriters in connection with the Directed Unit Program; (i) the investor presentations on
any “road show” undertaken in connection with the marketing of the offering of the Units,
including, without limitation, expenses associated with any Internet roadshow, travel and lodging
expenses of the representatives and officers of the Partnership Entities and the cost of any
aircraft chartered in
26
connection with the roadshow; and (j) all other costs and expenses incident to the performance
of the obligations of the Xxxxxxxx Parties and the Selling Unitholders under this Agreement;
provided that, except as provided in this Section 8 and in Section 13, the
Underwriters shall pay their own costs and expenses, including the costs and expenses of their
counsel, any transfer taxes on the Units that they may sell and the expenses of advertising any
offering of the Units made by the Underwriters.
Section 9. Conditions of Underwriters’ Obligations.
The respective obligations of the Underwriters hereunder are subject to the accuracy, when
made and on each Delivery Date, of the representations and warranties of the Xxxxxxxx Parties and
the Selling Unitholders contained herein, to the performance by the Xxxxxxxx Parties and the
Selling Unitholders of their respective obligations hereunder, and to each of the following
additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission in accordance with
Section 5(a); 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 any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus or otherwise shall have been
disclosed to the Representative and complied with to their satisfaction.
(b) No Underwriter shall have discovered and disclosed to the Partnership on or prior to such
Delivery Date that the Registration Statement or the Prospectus or any amendment or supplement
thereto contains an untrue statement of a fact which, in the reasonable opinion of Xxxxxx & Xxxxxx
LLP, counsel for the Underwriters, is material or omits to state a fact which, in the reasonable
opinion of such counsel, is material and is required to be stated therein or is necessary to make
the statements therein not misleading (in the case of the Prospectus, in light of the circumstances
under which such statements were made).
(c) All corporate, partnership and limited liability company proceedings and other legal
matters incident to the authorization, form and validity of this Agreement, the Units, the
Registration Statement and the Prospectus, and all other legal matters relating to this Agreement,
the transactions contemplated hereby (including the Transactions) shall be reasonably satisfactory
in all material respects to counsel for the Underwriters, and the Xxxxxxxx Parties and the Selling
Unitholders shall have furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(d) Xxxxxxx Xxxxx LLP shall have furnished to the Representative their written opinion, as
counsel to the Xxxxxxxx Entities, addressed to the Underwriters and dated such Delivery Date, in
form and substance reasonably satisfactory to the Representative, with respect to the matters set
forth in Exhibit B to this Agreement.
(e) The Representative shall have received from Xxxxx X. Xxxxxx, internal counsel to the
Partnership, his written opinion, addressed to the Underwriters and dated such Delivery Date, in
form and substance reasonably satisfactory to the Representative, with respect to the matters set
forth in Exhibit C to this Agreement.
27
(f) The Representative shall have received from Xxxxxx, Xxxx & Xxxxxxxx LLP, special counsel
for the Xxxxxxxx Entities, their written opinion addressed to the Underwriters and dated such
Delivery Date, in form and substance reasonably satisfactory to the Representative, with respect to
the matters set forth in Exhibit D to this Agreement.
(g) The Representative shall
have received from [ ], which is acting as special
local counsel for the Xxxxxxxx Entities, an opinion or opinions, addressed to the Underwriters and
dated such Delivery Date, in the form and substance reasonably satisfactory to the Representative,
with respect to the matters set forth in Exhibit E to this Agreement.
(h) The Representative
shall have received from [ ], which is acting as counsel for the
Selling Unitholders, their written opinion, addressed to the Underwriters and dated such Delivery
date, in form and substance reasonably satisfactory to the Representative, with respect to the
matters set forth in Exhibit F to this Agreement.
(i) The Representative shall have received from Xxxxxx & Xxxxxx LLP, counsel for the
Underwriters, such opinion or opinions, dated such Delivery Date, with respect to the issuance and
sale of the Units, the Registration Statement, the Prospectus and other related matters as the
Representative may reasonably require, and the Xxxxxxxx Parties shall have furnished to such
counsel such documents as they reasonably request for the purpose of enabling them to pass upon
such matters.
(j) At the time of execution of this Agreement, the Representative shall have received from
Ernst & Young LLP a letter or letters, in form and substance satisfactory to the Representative,
addressed to the Underwriters and dated the date hereof (i) confirming that they are independent
public accountants within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation
S-X of the Commission and (ii) stating, as of the date hereof (or, with respect to matters
involving changes or developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than three days prior to the date
hereof), the conclusions and findings of such firm with respect to the financial information and
other matters ordinarily covered by accountants’ “comfort letters” to underwriters in connection
with registered public offerings.
(k) With respect to the letter or letters of Ernst & Young LLP referred to in the preceding
paragraph and delivered to the Representative concurrently with the execution of this Agreement
(the “initial letter”), the Partnership shall have furnished to the Representative a letter (the
“bring-down letter”) of such accountants, addressed to the Underwriters and dated such Delivery
Date (i) confirming that they are independent public accountants within the meaning of the
Securities Act and are in compliance with the applicable requirements relating to the qualification
of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of
the bring-down letter (or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the Prospectus, as of a
date not more than three days prior to the date of the bring-down letter), the conclusions and
findings of such firm with respect to the financial information and other matters covered by the
initial letter and (iii) confirming in all material respects the conclusions and findings set forth
in the initial letter.
28
(l) On each Delivery Date, the General Partner shall have furnished to the Representative a
certificate, dated such Delivery Date, of its Chairman of the Board, its President or a Vice
President and its chief financial officer stating that:
(i) the representations, warranties and agreements of the Xxxxxxxx Parties contained in
Section 1 of this Agreement are true and correct as of such Delivery Date; the
Xxxxxxxx Parties have complied with all of their agreements and satisfied all the conditions
contained herein;
(ii) no stop order suspending the effectiveness of the Registration Statement has been
issued, and no proceedings for that purpose have been instituted or, to their knowledge,
threatened; and
(iii) they have carefully examined the Registration Statement and the Prospectus and,
in their opinion, (A) the Registration Statement, as of the Effective Time, and the
Prospectus, as of its date and as of such Delivery Date, did not and do not contain any
untrue statement of a material fact and did not and do not omit to state a material fact
required to be stated therein or necessary to make the statements therein (in the case of
the Prospectus, in the light of the circumstances under which such statements were made) not
misleading, and (B) since the Effective Time, no event has occurred that should have been
set forth in a supplement or amendment to the Registration Statement or the Prospectus that
has not been so set forth.
(m) The Selling Unitholders shall have furnished to the Representative on such Delivery Date a
certificate, dated such Delivery Date, signed by, or on behalf of, the Selling Unitholders stating
that the representations, warranties and agreements of the Selling Unitholders contained herein are
true and correct on and as of such Delivery Date and that the Selling Unitholders have complied
with all their agreements contained herein and has satisfied all the conditions on its part to be
performed or satisfied hereunder at or prior to such Delivery Date.
(n) None of the Xxxxxxxx Entities shall have sustained since the date of the latest audited
financial statements included in the Prospectus (A) 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, or shall have become a party to or the subject of any litigation,
court or governmental action, investigation, order or decree which is adverse to the Partnership
Entities or (B) since such date there shall not have been any adverse change in the partners’
capital, members’ equity or short-term or long-term debt of the Partnership Entities or any change,
or any development involving a prospective adverse change, in or affecting the condition (financial
or otherwise), results of operations, securityholders’ equity, properties, management, business or
prospects of the Partnership Entities, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (A) or (B), is, in the
judgment of the Representative, so material and adverse as to make it impracticable or inadvisable
to proceed with the public offering or the delivery of the Units being delivered on such Delivery
Date on the terms and in the manner contemplated in the Prospectus.
29
(o) Subsequent to the execution and delivery of this Agreement there shall not have occurred
any of the following: (i) trading in securities generally on the NYSE or the American Stock
Exchange or in the over the counter market shall have been suspended or materially limited or the
settlement of such trading generally shall have been materially disrupted or minimum prices shall
have been established on any such exchange or such market by the Commission, by such exchange or by
any other regulatory body or governmental authority having jurisdiction, (ii) trading in any
securities of the Partnership or any of the Xxxxxxxx Entities on any exchange or in the
over-the-counter market shall have been suspended or materially limited or the settlement of such
trading generally shall have been materially disrupted or minimum prices shall have been
established on any such exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (iii) a banking moratorium shall
have been declared by federal or state authorities, (iv) the United States shall have become
engaged in hostilities, there shall have been an escalation in hostilities involving the United
States or there shall have been a declaration of a national emergency or war by the United States
or (v) there shall have occurred such a material adverse change in general economic, political or
financial conditions, including, without limitation, as a result of terrorist activities after the
date hereof (or the effect of international conditions on the financial markets in the United
States shall be such) as to make it, in the judgment of the Representative, impracticable or
inadvisable to proceed with the public offering or delivery of the Units being delivered on such
Delivery Date on the terms and in the manner contemplated in the Prospectus.
(p) The NYSE shall have approved the Units for listing, subject only to official notice of
issuance.
(q) The Lock-Up Agreements between the Representative and the persons and entities set forth
on Schedule 3, shall have been delivered to the Representative on or before the date of
this Agreement.
(r) The Xxxxxxxx Parties shall have furnished the Representative such additional documents and
certificates as the Representative or counsel for the Underwriters may reasonably request.
(s) The Representative shall have received evidence satisfactory to it that each of the
Transactions (other than the offering of the Units) shall have occurred or will occur as of the
First Delivery Date, in each case, on substantially the terms as described in the Prospectus.
All opinions, letters, documents, evidence and certificates mentioned above or elsewhere in
this Agreement shall be in compliance with the provisions hereof only if they are in form and
substance reasonably satisfactory to counsel for the Underwriters.
Section 10. Indemnification and Contribution.
(a) The Xxxxxxxx Parties, jointly and severally, shall indemnify and hold harmless each
Underwriter, its directors, officers and employees and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof (including, but not
30
limited to, any loss, claim, damage, liability or action relating to purchases and sales of
Units), to which that Underwriter, director, officer, employee or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto or (B) in any materials or information
provided to investors by, or with the written approval of, the Partnership in connection with the
marketing of the offering of the Units (“Marketing Materials”), including any roadshow or investor
presentations made to investors by the Partnership (whether in person or electronically), (ii) the
omission or alleged omission to state in the Registration Statement, or in any amendment or
supplement thereto, or any Marketing Materials, any material fact required to be stated therein or
necessary to make the statements therein not misleading, (iii) the omission or alleged omission to
state in any Preliminary Prospectus, the Prospectus or in any amendment or supplement thereto any
material fact necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading, or (iv) any act or failure to act or any alleged act or failure to
act by any Underwriter in connection with, or relating in any manner to, the Units or the offering
contemplated hereby, and which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon matters covered by clause (i), (ii) or (iii) above
(provided that the Xxxxxxxx Parties shall not be liable under this clause (iv) to the extent that
it is determined in a final judgment by a court of competent jurisdiction that such loss, claim,
damage, liability or action resulted directly from any such acts or failures to act undertaken or
omitted to be taken by such Underwriter through its gross negligence or willful misconduct), and
shall reimburse each Underwriter and each such director, officer, employee or controlling person
promptly upon demand for any legal or other expenses reasonably incurred by that Underwriter,
director, officer, employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Xxxxxxxx Parties shall not be liable in any such case to the
extent that any such loss, claim, damage, liability, action or expense arises out of, or is based
upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or in any such amendment or
supplement, in reliance upon and in conformity with written information concerning such Underwriter
furnished to the Partnership through the Representative by or on behalf of any Underwriter
specifically for inclusion therein, which information consists solely of the information specified
in Section 10(f); and provided further, that this paragraph (a) with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter (or any person controlling
such Underwriter) on account of any loss, claim, damage, liability or action arising from the sale
of Units to any person by such Underwriter if such Underwriter failed to send or give a copy of the
Prospectus, as the same may be amended or supplemented, to such person within the time required by
the Securities Act and the Rules and Regulations, and the untrue or alleged untrue statement of a
material fact or omission or alleged omission of a material fact in the Preliminary Prospectus was
corrected in the Prospectus, unless such failure to deliver the Prospectus resulted from
non-compliance by the Partnership with Section 7(c) hereof. The foregoing indemnity
agreement is in addition to any liability which the Xxxxxxxx Parties may otherwise have to any
Underwriter or to any director, officer, employee or controlling person of that Underwriter.
31
(b) The Selling Unitholders, jointly and severally, shall indemnify and hold harmless each
Underwriter, its directors, officers and employees, and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof (including, but not
limited to, any loss, claim, damage, liability or action relating to purchases and sales of Common
Units), to which that Underwriter, director, officer, employee or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration Statement or the Prospectus
or in any amendment or supplement thereto or any Marketing Materials, or (ii) the omission or
alleged omission to state in any Preliminary Prospectus, Registration Statement or the Prospectus,
or in any amendment or supplement thereto or any Marketing Materials, any material fact required to
be stated therein or necessary to make the statements therein not misleading, and shall reimburse
each Underwriter, its directors, officers and employees and each such controlling person promptly
upon demand for any legal or other expenses reasonably incurred by that Underwriter, its directors,
officers and employees or controlling persons in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Selling Unitholders shall not be liable in any such case to
the extent that any such loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or in any such amendment or
supplement in reliance upon and in conformity with written information concerning any Underwriter
furnished to the Partnership through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein, which information consists solely of the information specified
in Section 10(f). The foregoing indemnity agreement is in addition to any liability that the
Selling Unitholders may otherwise have to any Underwriter or any officer, employee or controlling
person of that Underwriter.
(c) Each Underwriter, severally and not jointly, shall indemnify and hold harmless the
Xxxxxxxx Parties, the Selling Unitholders, their respective directors (including any person who,
with his or her consent, is named in the Registration Statement as about to become a director of
the General Partner or the Partnership), managers, officers and employees, and each person, if any,
who controls any Xxxxxxxx Party or any Selling Unitholder within the meaning of Section 15 of the
Securities Act, from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Xxxxxxxx Parties, the Selling Unitholders or any such
director, manager, officer, employee or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the Prospectus or in any amendment or
supplement thereto, or any Marketing Materials, (ii) the omission or alleged omission to state in
the Registration Statement or in any amendment or supplement thereto, or any Marketing Materials,
any material fact required to be stated therein or necessary to make the statements therein not
misleading, or (iii) the omission or alleged omission to state in any Preliminary Prospectus, the
Prospectus or in any amendment or supplement thereto any material fact necessary to make the
statements therein, in light of the circumstances under which such statements were made, not
misleading, but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon
32
and in conformity with written information concerning such Underwriter furnished to the
Partnership through the Representative by or on behalf of that Underwriter specifically for
inclusion therein, which information is limited to the information set forth in Section
10(f) and shall reimburse the Xxxxxxxx Parties, the Selling Unitholders and any such director,
manager, officer, employee or controlling person for any legal or other expenses reasonably
incurred by the Xxxxxxxx Parties, the Selling Unitholders or any such director, manager, officer,
employee or controlling person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability that any Underwriter may otherwise
have to the Xxxxxxxx Parties, the Selling Unitholders or any such director, manager, officer,
employee or controlling person.
(d) Promptly after receipt by an indemnified party under this Section 10 of notice of
any claim or the commencement of any action, the indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under this Section 10, notify the
indemnifying party in writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 10 except to the extent it has been materially prejudiced by
such failure and, provided, further, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have to an indemnified party otherwise than under this
Section 10. If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under this Section 10 for any legal or other expenses subsequently
incurred by the indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the Representative shall have the right to employ
counsel to represent jointly the Representative and those other Underwriters and their respective
directors, officers, employees and controlling persons who may be subject to liability arising out
of any claim in respect of which indemnity may be sought by the Underwriters against the Xxxxxxxx
Parties or any Selling Unitholder under this Section 10 if (i) the Xxxxxxxx Parties, the
Selling Unitholders and the Underwriters shall have so mutually agreed; (ii) the Xxxxxxxx Parties
and the Selling Unitholders have failed within a reasonable time to retain counsel reasonably
satisfactory to the Underwriters; (iii) the Underwriters and their respective directors, officers,
employees and controlling persons shall have reasonably concluded that there may be legal defenses
available to them that are different from or in addition to those available to the Xxxxxxxx Parties
and the Selling Unitholders; or (iv) the named parties in any such proceeding (including any
impleaded parties) include both the Underwriters or their respective directors, officers, employees
or controlling persons, on the one hand, and the Xxxxxxxx Parties, the Selling Unitholders or their
respective directors, managers, officers, employees or controlling persons, on the other hand, and
representation of both sets of parties by the same counsel would be inappropriate due to actual or
potential differing interests between them, and in any such event the fees and expenses of such
separate counsel shall be paid by the Xxxxxxxx Parties and the Selling Unitholders.
Notwithstanding anything contained herein to the contrary, if indemnity may be sought pursuant to
Section 10(g) hereof in respect of a claim or action referred to in
33
Section 10(g), then in addition to such separate firm for the indemnified parties, the
indemnifying party shall be liable for the fees and expenses of not more than one separate firm (in
addition to any local counsel) for the Xxxxxx Brothers Entities (as defined in Section
10(g)) for the defense of any loss, claim, damage, liability or action arising out of the
Directed Unit Program. No indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened claim, action, suit
or proceeding in respect of which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of each indemnified party from
all liability arising out of such claim, action, suit or proceeding and does not include any
findings of fact or admissions of fault or culpability as to the indemnified party, or (ii) be
liable for any settlement of any such action effected without its written consent (which consent
shall not be unreasonably withheld), but if settled with the consent of the indemnifying party or
if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or liability by reason
of such settlement or judgment.
(e) If the indemnification provided for in this Section 10 shall for any reason be
unavailable to or insufficient to hold harmless an indemnified party under Section 10(a),
10(b), 10(c) or 10(g) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying party shall, in lieu
of indemnifying such indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received
by the Xxxxxxxx Parties and the Selling Unitholders, on the one hand, and the Underwriters, on the
other, from the offering of the Units or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the Xxxxxxxx Parties and
the Selling Unitholders, on the one hand, and the Underwriters, on the other, with respect to the
statements or omissions that resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The relative benefits
received by the Xxxxxxxx Parties and the Selling Unitholders, on the one hand, and the
Underwriters, on the other, with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Units purchased under this Agreement
(before deducting expenses) received by the Partnership and the Selling Unitholders as set forth in
the table on the cover page of the Prospectus, on the one hand, and the total underwriting
discounts and commissions received by the Underwriters with respect to the Units purchased under
this Agreement, as set forth in the table on the cover page of the Prospectus, on the other hand,
bear to the total gross proceeds from the offering of the Units under this Agreement, as set forth
in the table on the cover page of the Prospectus. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the Xxxxxxxx Parties,
the Selling Unitholders or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such statement or omission.
The Xxxxxxxx Parties, the Selling Unitholders and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this Section 10(e) were to be determined by pro
rata allocation (even if the Underwriters were treated as one entity for
34
such purpose) or by any other method of allocation which does not take into account the
equitable considerations referred to herein. The amount paid or payable by an indemnified party as
a result of the loss, claim, damage or liability, or action in respect thereof, referred to above
in this Section 10(e) shall be deemed to include, for purposes of this Section
10(e), 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
Section 10(e), no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Units underwritten by it and distributed to the public
was offered to the public exceeds the amount of any damages which such Underwriter has otherwise
paid or become liable to pay by reason of any 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 Securities Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Underwriters’ obligations to contribute as provided in
this Section 10(e) are several in proportion to their respective underwriting obligations
and not joint.
(f) The Underwriters severally confirm and the Xxxxxxxx Parties and each Selling Unitholder
acknowledge that the table of underwriters on page [161], [the second full paragraph under the
heading “Commissions and Expenses” on page 161, the third full paragraph under the heading “Lock-Up
Agreements” on page 162, the first and second full paragraphs under the heading “Stabilization,
Short Position and Penalty Bids” on page 163, the second full paragraph under the heading “New York
Stock Exchange” on page 164, the information under the heading “Discretionary Sales” on page 164
and the information under the heading “NASD Conduct Rules” on page 164] appearing under the caption
“Underwriting” in the Prospectus are correct and constitute the only information concerning such
Underwriters furnished in writing to the Xxxxxxxx Parties by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement and the Prospectus.
(g) The Xxxxxxxx Parties, jointly and severally, shall indemnify and hold harmless Xxxxxx
Brothers Inc. (including its directors, officers and employees) and each person, if any, who
controls Xxxxxx Brothers Inc. within the meaning of Section 15 of the Securities Act (“Xxxxxx
Brothers Entities”), from and against any loss, claim, damage or liability or any action in respect
thereof to which any of the Xxxxxx Brothers Entities may become subject, under the Securities Act
or otherwise, insofar as such loss, claim, damage, liability or action (i) arises out of, or is
based upon, any untrue statement or alleged untrue statement of a material fact contained in any
material prepared by or with the approval of any Xxxxxxxx Party for distribution to Directed Unit
Participants in connection with the Directed Unit Program or any 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 the case of the Prospectus, in light of the circumstances under which
such statements were made), (ii) arises out of, or is based upon, the failure of the Directed Unit
Participant to pay for and accept delivery of Directed Units that the Directed Unit Participant
agreed to purchase or (iii) is otherwise related to the Directed Unit Program; provided that, the
Xxxxxxxx Parties shall not be liable under this clause (iii) for any loss, claim, damage, liability
or action (or expenses relating thereto) that is determined in a final judgment by a court of
competent jurisdiction to have resulted from the bad faith, gross negligence or willful misconduct
of the Xxxxxx Brothers Entities. The Xxxxxxxx Parties, jointly and severally, shall reimburse the
Xxxxxx Brothers Entities promptly upon demand for any legal or other expenses
35
reasonably incurred by them in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such expenses are incurred.
Section 11. Defaulting Underwriters.
If, on either Delivery Date, any Underwriter defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Underwriters shall be obligated to purchase the
Units which the defaulting Underwriter agreed but failed to purchase on such Delivery Date in the
respective proportions which the number of the Firm Units set forth opposite the name of each
remaining non-defaulting Underwriter in Schedule 1 hereto bears to the total number of Firm
Units set forth opposite the names of all the remaining non-defaulting Underwriters in Schedule
1 hereto; provided, however, that the remaining non-defaulting Underwriters shall not be
obligated to purchase any of the Units on such Delivery Date if the total number of the Units which
the defaulting Underwriter or Underwriters agreed but failed to purchase on such date exceeds 9.09%
of the total number of Units to be purchased on such Delivery Date, and any remaining
non-defaulting Underwriter shall not be obligated to purchase more than 110% of the number of Units
which it agreed to purchase on such Delivery Date pursuant to the terms of Section 3. If
the foregoing maximums are exceeded, the remaining non-defaulting Underwriters, or those other
underwriters satisfactory to the Representative who so agree, shall have the right, but shall not
be obligated, to purchase, in such proportion as may be agreed upon among them, all the Units to be
purchased on such Delivery Date. If the remaining Underwriters or other underwriters satisfactory
to the Representative do not elect to purchase the Units that the defaulting Underwriter or
Underwriters agreed but failed to purchase on such Delivery Date, this Agreement (or, with respect
to the Second Delivery Date, the obligation of the Underwriters to purchase, and of the Selling
Unitholders to sell, the Option Units) shall terminate without liability on the part of any
non-defaulting Underwriter or the Xxxxxxxx Parties or the Selling Unitholders, except that the
Xxxxxxxx Parties will continue to be liable for the payment of expenses to the extent set forth in
Sections 8 and 13. As used in this Agreement, the term “Underwriter” includes, for
all purposes of this Agreement unless the context requires otherwise, any party not listed in
Schedule 1 hereto who, pursuant to this Section 11, purchases Firm Units that a
defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have
to the Xxxxxxxx Parties and the Selling Unitholders for damages caused by its default. If other
Underwriters are obligated or agree to purchase the Units of a defaulting or withdrawing
Underwriter, either the Representative or the Partnership may postpone the Delivery Date for up to
seven full business days in order to effect any changes that in the opinion of counsel for the
Partnership or counsel for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
36
Section 12. Termination.
The obligations of the Underwriters hereunder may be terminated by the Representative by
notice given to and received by the Partnership and the Selling Unitholders prior to delivery of
and payment for the Firm Units if, prior to that time, any of the events described in Sections
9(n) or 9(o), shall have occurred or if the Underwriters shall decline to purchase the
Units for any reason permitted under this Agreement.
Section 13. Reimbursement of Underwriters’ Expenses.
If the Partnership or any Selling Unitholders shall fail to tender the Units for delivery to
the Underwriters by reason of any failure, refusal or inability on the part of any of the Xxxxxxxx
Entities or any Selling Unitholders to perform any agreement on its part to be performed, or
because any other condition of the Underwriters’ obligations hereunder required to be fulfilled by
any of the Xxxxxxxx Entities or the Selling Unitholders (including, without limitation, with
respect to the Transactions) is not fulfilled, the Xxxxxxxx Parties and the Selling Unitholders
will reimburse the Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Underwriters in connection with this Agreement and the
proposed purchase of the Units, and upon demand the Xxxxxxxx Parties and the Selling Unitholders
shall pay the full amount thereof to the Representative. If this Agreement is terminated pursuant
to Section 11 by reason of the default of one or more Underwriters, neither the Xxxxxxxx
Parties nor any Selling Stockholder shall be obligated to reimburse any defaulting Underwriter on
account of those expenses.
Section 14. Research Independence.
In addition, the Xxxxxxxx Parties and the Selling Unitholders acknowledge that the
Underwriters’ research analysts and research departments are required to be independent from their
respective investment banking divisions and are subject to certain regulations and internal
policies, and that such Underwriters’ research analysts may hold and make statements or investment
recommendations and/or publish research reports with respect to the Partnership and/or the offering
of the Units that differ from the views of its investment bankers. The Xxxxxxxx Parties and the
Selling Unitholders hereby waive and release, to the fullest extent permitted by law, any claims
that the Xxxxxxxx Parties or the Selling Unitholders may have against the Underwriters with respect
to any conflict of interest that may arise from the fact that the views expressed by their
independent research analysts and research departments may be different from or inconsistent with
the views or advice communicated to the Xxxxxxxx Parties or the Selling Unitholders by such
Underwriters’ investment banking divisions. The Xxxxxxxx Parties and the Selling Unitholders
acknowledge that each of the Underwriters is a full service securities firm and as such from time
to time, subject to applicable securities laws, may effect transactions for its own account or the
account of its customers and hold long or short positions in debt or equity securities of the
Partnership or Xxxxxxxx.
Section 15. No Fiduciary Duty.
Notwithstanding any preexisting relationship, advisory or otherwise, between the parties or
any oral representations or assurances previously or subsequently made by the Underwriters,
37
each of the Xxxxxxxx Parties and the Selling Unitholders acknowledge and agree that in
connection with the offering contemplated by this Agreement (the “Offering”): (i) there exists no
fiduciary or agency relationship between any of the Xxxxxxxx Parties and the Selling Unitholders,
on the one hand, and the Underwriters, on the other; (ii) the relationship between the Xxxxxxxx
Parties and the Selling Unitholders, on the one hand, and the Underwriters, on the other, is
entirely and solely commercial, based on arms-length negotiations and the Underwriters are not
acting as advisors, expert or otherwise, to any of the Xxxxxxxx Parties or the Selling Unitholders;
(iii) notwithstanding anything in this Underwriting Agreement to the contrary, the Xxxxxxxx Parties
and the Selling Unitholders acknowledge that the Underwriters may have financial interests in
connection with the Offering in addition to the difference between the price to the public and the
purchase price paid to the Xxxxxxxx Parties or the Selling Unitholders by the Underwriters for the
Units and the Underwriters have no obligation to disclose, or account to the Xxxxxxxx Parties or
the Selling Unitholders for, any of such additional financial interests. Each of the Xxxxxxxx
Parties and the Selling Unitholders hereby waives and releases, to the fullest extent permitted by
law, any claims that the Xxxxxxxx Parties or the Selling Unitholders may have against the
Underwriters with respect to any breach or alleged breach of fiduciary duty in connection with the
Offering.
Section 16. Notices.
All statements, requests, notices and agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex or facsimile
transmission to Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Syndicate Department (Fax: 000-000-0000), with a copy, in the case of any notice
pursuant to Section 10(d), to the Director of Litigation, Office of the General Counsel,
Xxxxxx Brothers Inc., 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000 (Fax: 000-000-0000);
(b) if to the Xxxxxxxx Parties, shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Partnership set forth in the Registration Statement, Attention:
President (Fax: 000-000-0000);
provided, however, that any notice to an Underwriter pursuant to Section 10(d) shall be
delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set
forth in its acceptance telex to the Representative, which address will be supplied to any other
party hereto by the Representative upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Xxxxxxxx Parties and the Selling
Unitholders shall be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Underwriters by the Representative.
38
Section 17. Persons Entitled to Benefit of Agreement.
This Agreement shall inure to the benefit of and be binding upon the Underwriters, the
Xxxxxxxx Parties, the Selling Unitholders and their respective successors. This Agreement and the
terms and provisions hereof are for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Xxxxxxxx Parties and the Selling
Unitholders contained in this Agreement shall also be deemed to be for the benefit of the
directors, officers and employees of the Underwriters and each person or persons, if any, who
control any Underwriter within the meaning of Section 15 of the Securities Act and (B) the
indemnity agreement of the Underwriters contained in Section 10(c) of this Agreement shall
be deemed to be for the benefit of the directors and managers of the Xxxxxxxx Parties and the
Selling Unitholders, the officers of the Xxxxxxxx Parties who have signed the Registration
Statement and any person controlling the Xxxxxxxx Parties within the meaning of Section 15 of the
Securities Act. Nothing in this Agreement is intended or shall be construed to give any person,
other than the persons referred to in this Section 17, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision contained herein. [Notwithstanding
anything in this Agreement to the contrary, all liabilities and obligations of the Xxxxxxxx Parties
and the Selling Unitholders hereunder shall be non-recourse against any partner (including any
limited partner or general partner), stockholder, member, officer, director or employee of any of
the Xxxxxxxx Parties or the Selling Unitholders, other than the Xxxxxxxx Parties in their
capacities as such. In that connection, no such partner, stockholder, member, officer, director or
employee shall be bound by this Agreement, or be obligated by virtue of this Agreement or the
obligations of any party created hereunder to (A) provide funds to any of the Xxxxxxxx Parties or
the Selling Unitholders, whether by contributions to capital, loans, returns of monies, securities
or other property, or (B) assume any liabilities of any of the Xxxxxxxx Parties or the Selling
Unitholders.]
Section 18. Survival.
The respective indemnities, representations, warranties and agreements of the Xxxxxxxx
Parties, the Selling Unitholders and the Underwriters contained in this Agreement or made by or on
behalf on them, respectively, pursuant to this Agreement, shall survive the delivery of and payment
for the Units and shall remain in full force and effect, regardless of any investigation made by or
on behalf of any of them or any person controlling any of them.
Section 19. Definition of the Terms “Business Day” and “Subsidiary.”
For purposes of this Agreement, (a) “business day” means each Monday, Tuesday, Wednesday,
Thursday or Friday which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close and (b) “subsidiary” has the meaning set
forth in Rule 405 of the Rules and Regulations.
Section 20. Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
Section 21. Counterparts.
39
This Agreement may be executed in one or more counterparts and, if executed in more than one
counterpart, the executed counterparts shall each be deemed to be an original but all such
counterparts shall together constitute one and the same instrument.
Section 22. Headings.
The headings herein are inserted for convenience of reference only and are not intended to be
part of, or to affect the meaning or interpretation of, this Agreement.
40
If the foregoing correctly sets forth the agreement among the Xxxxxxxx Parties, the Selling
Unitholders and the Underwriters, please indicate your acceptance in the space provided for that
purpose below.
Very truly yours, | ||||
Xxxxxxxx Natural Gas Liquids, Inc. | ||||
By: | ||||
Name: | ||||
Title: | ||||
Xxxxxxxx Midstream Natural Gas Liquids, Inc. | ||||
By: | ||||
Name: | ||||
Title: | ||||
Xxxxxxxx Energy LLC | ||||
By: | ||||
Name: | ||||
Title: | ||||
Xxxxxxxx Energy Services, LLC | ||||
By: | ||||
Name: | ||||
Title: | ||||
Xxxxxxxx Discovery Pipeline, LLC | ||||
By: | ||||
Name: | ||||
Title: | ||||
Xxxxxxxx Partners Holding LLC | ||||
By: | ||||
Name: | ||||
Title |
41
Xxxxxxxx Partners GP LLC | ||||||||
By: | ||||||||
Name: | ||||||||
Title: | ||||||||
Xxxxxxxx Partners L.P. | ||||||||
By: | Xxxxxxxx Partners GP LLC, | |||||||
its General Partner | ||||||||
By: | ||||||||
Name: | ||||||||
Title: | ||||||||
Xxxxxxxx Partners Operating LLC | ||||||||
By: | ||||||||
Name: | ||||||||
Title: |
42
Accepted:
Xxxxxx Brothers Inc.
For itself and as Representative
of the several Underwriters named
in Schedule 1 hereto
of the several Underwriters named
in Schedule 1 hereto
By: Xxxxxx Brothers Inc.
By: |
||||
Authorized Representative |
43
SCHEDULE 1
Number of Firm | ||
Underwriters | Units to be Purchased | |
Xxxxxx Brothers Inc. |
[ ] | |
Citigroup Global Markets Inc. |
[ ] | |
RBC Capital Markets Corporation |
[ ] | |
Wachovia Capital Markets, LLC |
[ ] | |
Total |
5,000,000 |
Schedule 1
- 1
SCHEDULE 2
Name of Selling Unitholder | Number of Option Units | |
Xxxxxxxx Energy Services, LLC |
[ ] | |
Xxxxxxxx Energy, LLC |
[ ] | |
Xxxxxxxx Discovery Pipeline LLC |
[ ] | |
Xxxxxxxx Partners Holdings LLC |
[ ] |
Schedule 2
- 1
SCHEDULE 3
PERSONS DELIVERING LOCK-UP AGREEMENTS
[to come]
Schedule 3-1
ANNEX I
JURISDICTIONS OF QUALIFICATION
Jurisdiction of | ||||
Name of Entity | Formation | Jurisdictions of Qualification | ||
Xxxxxxxx Partners GP LLC
|
Delaware | [ ] | ||
Xxxxxxxx Partners L.P.
|
Delaware | [ ] | ||
Xxxxxxxx Partners Operating, LLC
|
Delaware | [ ] | ||
Mid-Continent Fractionation and
Storage, LLC
|
Delaware | Kansas | ||
Carbonate Trend Pipeline, LLC
|
Delaware | Louisiana and Alabama | ||
Discovery Producer Services, LLC
|
Delaware | Louisiana | ||
Discovery Gas Transmission LLC
|
Delaware | Louisiana | ||
Xxxxxxxx Energy Services LLC
|
Delaware | Florida, Illinois, Oklahoma, South Carolina, Texas and Xxxxxxxx | ||
Xxxxxxxx Partners Holdings LLC
|
Delaware | [ ] | ||
Xxxxxxxx Energy, LLC
|
Delaware | Louisiana | ||
The Xxxxxxxx Companies, Inc.
|
Delaware | District of Columbia, Kentucky, North Dakota, Oklahoma, Texas and Utah | ||
Xxxxxxxx Midstream Natural Gas
Liquids, Inc.
|
Delaware | Iowa, Kansas, Louisiana, Minnesota, Nebraska, Oklahoma and Texas | ||
Xxxxxxxx Natural Gas Liquids, Inc.
|
Delaware | Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Mississippi, Missouri, Nebraska, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee, Texas and Wisconsin | ||
Espagas USA, Inc.
|
Delaware | [ ] | ||
Annex I - 1
Jurisdiction of | ||||
Name of Entity | Formation | Jurisdictions of Qualification | ||
MAPCO, Inc.
|
Delaware | Alaska, Arizona, California, Illinois, Kentucky, Minnesota, Montana, New Mexico, North Dakota, Oklahoma, Utah and Wyoming |
Annex I-2
EXHIBIT A
LOCK-UP LETTER AGREEMENT
Xxxxxx Brothers Inc.
As Representative of the several
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned understands that you and certain other firms propose to enter into an
Underwriting Agreement (the “Underwriting Agreement”) providing for the purchase by you and such
other firms (the “Underwriters”) of the common units representing limited partner interests (the
“Common Units”) of Xxxxxxxx Partners L.P., a Delaware limited partnership (the “Partnership”), and
that the Underwriters propose to reoffer the Common Units to the public (the “Offering”).
In consideration of the execution of the Underwriting Agreement by the Underwriters, and for
other good and valuable consideration, the undersigned hereby irrevocably agrees that, without the
prior written consent of Xxxxxx Brothers Inc., on behalf of the Underwriters, the undersigned will
not, directly or indirectly, (1) offer for sale, sell, pledge, or otherwise dispose of (or enter
into any transaction or device that is designed to, or could be expected to, result in the
disposition by any person at any time in the future of) any Common Units (including, without
limitation, Common Units that may be deemed to be beneficially owned by the undersigned in
accordance with the rules and regulations of the Securities and Exchange Commission and Common
Units that may be issued upon exercise of any option or warrant) or securities convertible into or
exchangeable for Common Units owned by the undersigned on the date of execution of this Lock-Up
Letter Agreement or on the date of the completion of the Offering, or (2) enter into any swap or
other derivatives transaction that transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of such Common Units, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Common Units or other securities, in cash
or otherwise, (3) cause to be filed a registration statement with respect to the registration of
any Common Units or securities convertible, exercisable or exchangeable into Common Units or any
other securities of the Partnership or (4) publicly disclose the intention to do any of the
foregoing, for a period of 180 days after the date of the final Prospectus relating to the Offering
(such 180-day period, the “Lock-Up Period”). [The foregoing sentence shall not apply to bona fide
gifts, sales or other dispositions of any Common Units that are made exclusively between and among
the undersigned or members of the undersigned’s family, or affiliates of the undersigned, including
its partners (if a partnership) or members (if a limited liability company); provided that it shall
be a condition to any such transfer that (i) the transferee/donee agrees to be bound by the terms
of the lock-up agreement
Exhibit A-1
(including, without limitation, the restrictions set forth in the preceding sentence) to the
same extent as if the transferee/donee were a party hereto, (ii) no filing by any party (donor,
donee, transferor or transferee) under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), shall be required or shall be voluntarily made in connection with such transfer or
distribution (other than a filing on Form 5, Schedule 13D or Schedule 13G (or 13D/A or 13G/A) made
after the expiration of the 180-day period referred to above), (iii) each party (donor, donee,
transferor or transferee) shall not be required by law (including without limitation the disclosure
requirements of the Securities Act of 1933, as amended, and the Exchange Act) to make, and shall
agree to not voluntarily make, any public announcement of the transfer or disposition, and (iv) the
undersigned notifies Xxxxxx Brothers’ Equity Capital Markets at least two business days prior to
the proposed transfer or disposition.]
Notwithstanding the foregoing, if (1) during the last 17 days of the Lock-Up Period, the
Partnership issues an earnings release or material news or a material event relating to the
Partnership occurs or (2) prior to the expiration of the Lock-Up Period, the Partnership announces
that it will release earnings results during the 16-day period beginning on the last day of the
Lock-Up Period, then the restrictions imposed by this Lock-Up Letter Agreement shall continue to
apply until the expiration of the 18-day period beginning on the issuance of the earnings release
or the announcement of the material news or the occurrence of the material event, unless Xxxxxx
Brothers Inc. waives such extension in writing. The undersigned hereby further agrees that, prior
to engaging in any transaction or taking any other action that is subject to the terms of this
Lock-Up Letter Agreement during the period from the date of this Lock-Up Letter Agreement to and
including the 34th day following the expiration of the Lock-Up Period, it will give
notice thereof to the Partnership and will not consummate such transaction or take any such action
unless it has received written confirmation from the Partnership that the Lock-Up Period (as such
may have been extended pursuant to this paragraph) has expired.
In furtherance of the foregoing, the Partnership and its transfer agent are hereby authorized
to decline to make any transfer of securities if such transfer would constitute a violation or
breach of this Lock-Up Letter Agreement.
It is understood that, if the Partnership notifies the Underwriters that it does not intend to
proceed with the Offering, if the Underwriting Agreement does not become effective, or if the
Underwriting Agreement (other than the provisions thereof which survive termination) shall
terminate or be terminated prior to payment for and delivery of the Common Units, the undersigned
will be released from its obligations under this Lock-Up Letter Agreement.
The undersigned understands that the Partnership and the Underwriters will proceed with the
Offering in reliance on this Lock-Up Letter Agreement.
Whether or not the Offering actually occurs depends on a number of factors, including market
conditions. Any Offering will only be made pursuant to an Underwriting Agreement, the terms of
which are subject to negotiation among the Partnership, the Selling Unitholders named therein and
the Underwriters.
The undersigned hereby represents and warrants that the undersigned has full power and
authority to enter into this Lock-Up Letter Agreement and that, upon request, the undersigned
Exhibit A-2
will execute any additional documents necessary in connection with the enforcement hereof.
Any obligations of the undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
Very truly yours, | ||||
By: | ||||
Name: | ||||
Title: | ||||
Dated: August ___, 2005
Exhibit A-3
EXHIBIT B
FORM OF OPINION OF XXXXXXX XXXXX LLP
(i) The Partnership has been duly formed and is validly existing as a limited
partnership under the Delaware LP Act, is duly registered or qualified to do business and is
in good standing as a foreign limited partnership under the laws of the jurisdictions set
forth on Annex I to this Agreement, and to such counsel’s knowledge, such
jurisdictions are the only jurisdictions in which its ownership or lease of property or the
conduct of business requires such qualification, except where the failure to so register or
so qualify would not (A) reasonably be expected to have a Material Adverse Effect, or (B)
subject the limited partners of the Partnership to any material liability or disability; and
each such partnership has all requisite partnership power and authority necessary to own or
hold its properties and assets and to conduct the businesses in which it is engaged.
(ii) Each of the General Partner, OLLC and CTP has been duly formed and is validly
existing in good standing as a limited liability company under the Delaware LLC Act, is duly
registered or qualified to do business and is in good standing as a foreign limited
liability company under the laws of the jurisdictions set forth on Annex I to this
Agreement, and to such counsel’s knowledge, such jurisdictions are the only jurisdictions in
which its ownership or lease of property or the conduct of business requires such
qualification, except where the failure to so register or so qualify would not (A)
reasonably be expected to have a Material Adverse Effect, or (B) subject the limited
partners of the Partnership to any material liability or disability; and each such limited
liability company has all requisite limited liability company power and authority necessary
to own or hold its properties and to conduct the businesses in which it is engaged.
(iii) Each of MCFS, DPS and DGT is validly existing in good standing as a limited
liability company under the Delaware LLC Act, is duly registered or qualified to do business
and is in good standing as a foreign limited liability company under the laws of the
jurisdictions set forth on Annex I to this Agreement, and to such counsel’s
knowledge, such jurisdictions are the only jurisdictions in which its ownership or lease of
property or the conduct of business requires such qualification, except where the failure to
so register or so qualify would not (A) reasonably be expected to have a Material Adverse
Effect, or (B) subject the limited partners of the Partnership to any material liability or
disability; and each such limited liability company has all requisite limited liability
company power and authority necessary to own or hold its properties and to conduct the
businesses in which it is engaged.
(iv) The General Partner is the sole general partner of the Partnership with an initial
2.0% general partner interest in the Partnership; such general partner interest has been
duly authorized and validly issued in accordance with the Partnership Agreement; and the
General Partner owns such general partner interest free and clear of all liens,
encumbrances, security interests or claims (except restrictions on transferability contained
in the Partnership Agreement, as described in the Prospectus or created or arising under the
Delaware LP Act) (A) in respect of which a financing statement under
Exhibit B-1
the Uniform Commercial Code of the State of Delaware naming the General Partner as
debtor is on file with the Secretary of State of the State of Delaware, (B) in respect of
which a financing statement under the Uniform Commercial Code of the State of Oklahoma
naming the General Partner as debtor is on file with the Oklahoma UCC Central Filing Office
– Oklahoma County Clerk or (C) otherwise known to such counsel, other than those created by
or arising under the Delaware LP Act or the Partnership Agreement.
(v) The Sponsor Units, the Incentive Distribution Rights and the limited partner
interests represented thereby have been duly authorized and validly issued in accordance
with the Partnership Agreement, and are fully paid (to the extent required under the
Partnership Agreement) and non-assessable (except as such non-assessability may be affected
by (i) matters described in the Prospectus under the captions “The Partnership
Agreement—Limited Liability” and “Risk Factors—Risks Inherent in an Investment in Us—You may
not have limited liability if a court finds that unitholder action constitutes control of
our business” and (ii) Sections 17-303 and 17-607 of the Delaware LP Act); and WE, Holdings,
WES, and Xxxxxxxx Pipeline own the Sponsor Units free and clear of all liens, encumbrances,
security interests or claims (except restrictions on transferability in the Partnership
Agreement, as described in the Prospectus or those created or arising under the Delaware LP
Act) (A) in respect of which a financing statement under the Uniform Commercial Code of the
State of Delaware naming WE, Holdings, WES or Xxxxxxxx Pipeline as debtor is on file with
the Secretary of State of the State of Delaware, (B) in respect of which a financing
statement under the Uniform Commercial Code of the State of Oklahoma naming WE, Holdings,
WES or Xxxxxxxx Pipeline as debtor is on file with the Oklahoma UCC Central Filing Office –
Oklahoma County Clerk or (C) otherwise known to such counsel, other than those created by or
arising under the Delaware LP Act or the Partnership Agreement; and the General Partner owns
the Incentive Distribution Rights free and clear of all liens, encumbrances, security
interests or claims (A) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming the General Partner as debtor is on file
with the Secretary of State of the State of Delaware, (B) in respect of which a financing
statement under the Uniform Commercial Code of the State of Oklahoma naming the General
Partner as debtor is on file with the Oklahoma UCC Central Filing Office – Oklahoma County
Clerk or (C) otherwise known to such counsel, other than those created by or arising under
the Delaware LP Act or the Partnership Agreement.
(vi) The Firm Units and the Option Units, if any, to be issued and sold by the
Partnership and the Selling Unitholders, respectively, to the Underwriters pursuant to this
Agreement have been duly authorized and, when issued and delivered against payment therefor
in accordance with this Agreement will be validly issued, fully paid (to the extent required
under the Partnership Agreement) and non-assessable (except as such non-assessability may be
affected by (i) matters described in the Prospectus under the captions “The Partnership
Agreement—Limited Liability” and “Risk Factors—Risks Inherent in an Investment in Us—You may
not have limited liability if a court finds that unitholder action constitutes control of
our business” and (ii) Sections 17-303 and 17-607 of the Delaware LP Act); and other than
the Sponsor Units owned by WE, Holdings,
Exhibit B-2
XXX, and Xxxxxxxx Pipeline and the Incentive Distribution Rights owned by the General
Partner, the Firm Units will be the only limited partner interests of the Partnership issued
and outstanding at the First Delivery Date.
(vii) The Partnership owns a 100% limited liability company interest in OLLC; such
limited liability company interest has been duly authorized and validly issued in accordance
with the OLLC Agreement and is fully paid (to the extent required under the OLLC Agreement)
and non-assessable (except as such non-assessability may be affected by Section 18-607 of
the Delaware LLC Act); and the Partnership owns such limited liability company interest free
and clear of all liens, encumbrances, security interests or claims (A) in respect of which a
financing statement under the Uniform Commercial Code of the State of Delaware naming the
Partnership as debtor is on file with the Secretary of State of the State of Delaware, (B)
in respect of which a financing statement under the Uniform Commercial Code of the State of
Oklahoma naming the Partnership as debtor is on file with the Oklahoma UCC Central Filing
Office – Oklahoma County Clerk or (C) otherwise known to such counsel, other than those
created by or arising under the Delaware LLC Act or the OLLC Agreement.
(viii) OLLC owns a 100% limited liability company interest in each of MCFS and CTP;
such limited liability company interests have been duly authorized and validly issued in
accordance with the MCFS LLC Agreement and the CTP LLC Agreement, respectively, and are
fully paid (to the extent required under MCFS LLC Agreement or the CTP LLC Agreement, as
applicable) and non-assessable (except as such non-assessability may be affected by Section
18-607 of the Delaware LLC Act); and OLLC owns such limited liability company interests free
and clear of all liens, encumbrances, security interests or claims (A) in respect of which a
financing statement under the Uniform Commercial Code of the State of Delaware naming OLLC
as debtor is on file with the Secretary of State of the State of Delaware, (B) in respect of
which a financing statement under the Uniform Commercial Code of the State of Oklahoma
naming OLLC as debtor is on file with the Oklahoma UCC Central Filing Office – Oklahoma
County Clerk or (B) otherwise known to such counsel, other than those created by or arising
under the Delaware LLC Act, the MCFS LLC Agreement or the CTP LLC Agreement.
(ix) XXX owns a 100.0% limited liability company interest in the General Partner; such
limited liability company interest has been duly authorized and validly issued in accordance
with the GP LLC Agreement, and is fully paid (to the extent required under the GP LLC
Agreement) and non-assessable (except as such non-assessability may be affected by Section
18-607 of the Delaware LLC Act); and XXX owns such limited liability company interest free
and clear of all liens, encumbrances, security interests or claims (A) in respect of which a
financing statement under the Uniform Commercial Code of the State of Delaware naming XXX as
debtor is on file with the Secretary of State of the State of Delaware, (B) in respect of
which a financing statement under the Uniform Commercial Code of the State of Oklahoma
naming XXX as debtor is on file with the Oklahoma UCC Central Filing Office – Oklahoma
County Clerk or (C) otherwise known to such counsel, other than those created by or arising
under the Delaware LLC Act or the GP LLC Agreement.
Exhibit B-3
(x) OLLC owns a 40.0% limited liability company interest in DPS; such limited liability
company interest has been duly authorized and validly issued in accordance with the DPS LLC
Agreement, and is fully paid (to the extent required under the DPS LLC Agreement) and
non-assessable (except as such non-assessability may be affected by Section 18-607 of the
Delaware LLC Act); and OLLC owns such limited liability company interest free and clear of
all liens, encumbrances, security interests or claims (A) in respect of which a financing
statement under the Uniform Commercial Code of the State of Delaware naming OLLC as debtor
is on file with the Secretary of State of the State of Delaware, (B) in respect of which a
financing statement under the Uniform Commercial Code of the State of Oklahoma naming OLLC
as debtor is on file with the Oklahoma UCC Central Filing Office – Oklahoma County Clerk or
(C) otherwise known to such counsel, other than those created by or arising under the
Delaware LLC Act or the DPS LLC Agreement
(xi) DPS owns a 100% limited liability company interest in DGT; such limited liability
company interest has been duly authorized and validly issued in accordance with DGT LLC
Agreement and is fully paid (to the extent required under DGT LLC Agreement) and
non-assessable (except as such non-assessability may be affected by Section 18-607 of the
Delaware LLC Act); and DPS owns such limited liability company interest free and clear of
all liens, encumbrances, security interests or claims (A) in respect of which a financing
statement under the Uniform Commercial Code of the State of Delaware naming DPS as debtor is
on file with the Secretary of State of the State of Delaware, (B) in respect of which a
financing statement under the Uniform Commercial Code of the State of [Louisiana] naming DPS
as debtor is on file with the Secretary of State of the State of [Louisiana] or (C)
otherwise known to such counsel, other than those created by or arising under the Delaware
LLC Act or the DGT LLC Agreement.
(xii) Except as described in the Prospectus or as provided in the Amended Credit
Agreement[, the Revolving Credit Agreement], the DPS LLC Agreement or the DGT LLC Agreement,
there are no preemptive rights or other rights to subscribe for or to purchase, nor any
restriction upon the voting or transfer of (i) any limited partner interests in the
Partnership, (ii) any limited liability company interests in the General Partner or OLLC or
(iii) any limited liability company interests in any Subsidiary, in each case pursuant to
the Organizational Documents or any other agreement or instrument known to such counsel to
which any of such entities is a party or by which any one of them may be bound. To such
counsel’s knowledge, except as described in the Prospectus, there are no outstanding options
or warrants to purchase (A) any Common Units or Subordinated Units or other interests in the
Partnership or (B) any interests in the General Partner, OLLC or the Subsidiaries.
(xiii) Each of the Operative Agreements to which any of the Partnership Entities is a
party has been duly authorized and validly executed and delivered by each of the Partnership
Entities party thereto.
(xiv) Assuming the due authorization, execution and delivery by each party thereto
(other than the Partnership Entities), each of the Operative Agreements constitutes a valid
and binding obligation of the Partnership Entities party thereto, enforceable
Exhibit B-4
against each such Partnership Entities in accordance with its terms, subject to (A)
applicable bankruptcy, insolvency, fraudulent transfer or conveyance, reorganization,
moratorium and similar laws relating to or affecting creditors’ rights generally and by
general principles of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), (B) public policy, applicable law relating to fiduciary
duties and indemnification and an implied covenant of good faith and fair dealing and (C) in
the case of the enforceability of equitable rights and remedies provided for in such
agreements, equitable defenses and judicial discretion.
(xv) Assuming the due authorization, execution and delivery by each party thereto
(other than the Xxxxxxxx Entities (other than the Partnership Entities)), each of the
Contribution Agreement and the Omnibus Agreement constitutes a valid and binding obligation
of the Xxxxxxxx Entities (other than the Partnership Entities) party thereto, enforceable
against each such Xxxxxxxx Entities (other than the Partnership Entities) in accordance with
its respective terms, subject to (A) applicable bankruptcy, insolvency, fraudulent transfer
or conveyance, reorganization, moratorium and similar laws relating to or affecting
creditors’ rights generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), (B) public policy,
applicable law relating to fiduciary duties and indemnification and an implied covenant of
good faith and fair dealing and (C) in the case of the enforceability of equitable rights
and remedies provided for in such agreements, equitable defenses and judicial discretion.
(xvi) The Underwriting Agreement has been duly authorized, executed and delivered by
each of the Partnership Entities party thereto.
(xvii) The offering, issuance and sale by the Partnership of the Units, the execution,
delivery and performance by the Partnership Entities of the Underwriting Agreement, the
Operative Agreements to which any of the Partnership Entities is a party and the
consummation of the transactions contemplated hereby and thereby (including the
Transactions) has not caused, and will not cause, as applicable, (A) a violation of the
Organizational Documents, (B) a breach or violation of, or a default under (or an event
which, with notice or lapse of time or both, would constitute such an event), any Operative
Agreement or any agreement filed as an exhibit to the Registration Statement or (C) any
violation of any [federal statute, law or regulation, the Delaware LP Act, the Delaware LLC
Act] or, to the knowledge of such counsel, any [order, judgment, decree or injunction of any
federal or Delaware court or governmental agency or body directed to any of the Partnership
Entities or any of their properties in a proceeding to which any of them or their property
is subject], excluding in the case of clauses (B) and (C), any such breaches, violations and
defaults that would not have a Material Adverse Effect.
(xviii) Except for the registration of the Units under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state securities laws in connection with the purchase
and distribution of the Units by the Underwriters, no consent, approval, authorization or
order of, or filing or registration with, any such court or governmental
Exhibit B-5
agency or body is required for the execution, delivery and performance of the
Underwriting Agreement or any of the Operative Agreements by the Partnership Entities party
thereto and the consummation of the transactions contemplated thereby, except for such
consents, approvals, authorizations, orders, filings or registrations (A) as have been
obtained or made and (B) would not have a Material Adverse Effect if not obtained or made.
(xix) [The statements contained in the Prospectus under the captions “Risk Factors –
Risks Inherent in Our Business – Discovery’s interstate tariff rates are subject to review
and possible adjustment by federal regulators, which could have a material adverse effect on
our business and operating results. Moreover, because Discovery is a non-corporate entity,
it may be disadvantaged in calculating its cost of service for rate-making purposes,” “How
We Make Cash Distributions,” “Management’s Discussion and Analysis of Financial Condition
and Results of Operations—Liquidity and Capital Resources—Working Capital Credit Facility,”
“Business—FERC Regulation,” “Business—Environmental Regulation” (other than the statements
under the caption “Business—Environmental Regulation—Kansas Department of Health and
Environment Obligations” as to which such counsel need not opine), “Management—Long-Term
Incentive Plan,” “Certain Relationships and Related Transactions,” “Conflicts of Interest
and Fiduciary Duties,” “The Partnership Agreement,” “Material Tax Consequences,” [and
“Investment in Xxxxxxxx Partners L.P. by Employee Benefit Plans,”] insofar as they
constitute descriptions of contracts or legal proceedings or refer to statements of law or
legal conclusions, are accurate and complete in all material respects; and the Units, the
Subordinated Units and the Incentive Distribution Rights conform in all material respects to
the descriptions thereof contained in the Prospectus under the captions “Prospectus
Summary¾The Offering,” “How We Make Cash Distributions,” “Description of the Common
Units,” “Description of the Subordinated Units” and “The Partnership Agreement.”]
(xx) The opinion of Xxxxxxx Xxxxx LLP that is filed as Exhibit 8.1 to the Registration
Statement is confirmed and the Underwriters may rely upon such opinion as if it were
addressed to them.
(xxi) The Registration Statement was declared effective under the Securities Act as of
the date and time specified in such opinion; the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Rules and Regulations specified in such
opinion on the date specified therein; and no stop order suspending the effectiveness of the
Registration Statement has been issued and, to the knowledge of such counsel, no proceeding
for that purpose is pending or threatened by the Commission.
(xxii) The Registration Statement and the Prospectus and any further amendments or
supplements thereto made by the Partnership prior to such Delivery Date (except for the
financial statements and the notes and financial schedules thereto, and other financial and
other related statistical and accounting data included therein, as to which such counsel
need express no opinion) appear on their face to comply as to form in all material respects
with the requirements of the Securities Act and the Rules and Regulations.
Exhibit B-6
(xxiii) To the best of such counsel’s knowledge, there are no contracts or other
documents which are required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and Regulations which have not
been described or filed as exhibits to the Registration Statement.
(xxiv) None of the Partnership Entities are, after giving effect to the Transactions
and the application of the net proceeds therefrom as described under “Use of Proceeds” in
the Prospectus, will be, an “investment company” as defined in the Investment Company Act of
1940, as amended or (ii) a “public utility company,” “holding company” or a “subsidiary
company” of a “holding company” under the Public Utility Holding Company Act of 1935, as
amended.
(xxv) The offer, sale and issuance of the Sponsor Units to WE, Holdings, XXX and
Xxxxxxxx Pipeline and of the Incentive Distribution Rights to the General Partner pursuant
to the Partnership Agreement are exempt from the registration requirements of the Securities
Act.
Such counsel has participated in conferences with officers and other representatives of the
Xxxxxxxx Parties, representatives of the independent registered public accounting firm of the
Partnership and the Underwriters’ representatives, at which the contents of the Registration
Statement and Prospectus and related matters were discussed, and because such did not independently
investigate or verify the information set forth in the Registration Statement or the Prospectus
(except to the extent specified in paragraphs (xviii) and (xix) above), such counsel is not passing
upon and does not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus (except to the extent
specified in paragraphs (xviii) and (xix) above). Based on the foregoing (relying as to factual
matters in respect of the determination of materiality to the extent such counsel deems reasonable
and appropriate upon the statements of fact made by officers and other representatives of the
Partnership Entities), no facts have come to such counsel’s attention that have led such counsel to
believe that the Registration Statement at the time such Registration Statement became effective,
contained any 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 contained an untrue statement of a material fact or omitted a material fact
required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or that, as of the date hereof, the
Prospectus contains an untrue statement of a material fact or omits to state a material fact
necessary to make the statements therein, in light of the circumstances under which they were made,
not misleading. Such counsel, however, expresses no opinion with respect to the financial
statements and notes and related schedules thereto and other related financial, statistical and
accounting data included in the Registration Statement or in the Prospectus or any further
amendment or supplement thereto or the exhibits to the Registration Statement.
Such counsel’s opinion may be limited to matters governed by the Federal laws of the United
States of America, the laws of the States of Texas, the Delaware LP Act and the Delaware LLC Act.
Such counsel need not express any opinion with respect to the title of any of the Partnership
Entities to any of their respective real or personal property or the accuracy of the descriptions
or references in the Registration Statement or the Operative Agreements to any real
Exhibit B-7
or personal property, and need not express any opinion with respect to state or local taxes or
tax statutes to which any of the limited partners of the Partnership or any of the Partnership
Entities may be subject.
Exhibit B-8
EXHIBIT C
FORM OF OPINION OF INTERNAL COUNSEL TO THE PARTNERSHIP
(i) Each of WNGL, WMNGL MAPCO and Espagas is validly existing as a corporation in good
standing under the DGCL.
(ii) Each of XXX, Xxxxxxxx Pipeline and WE is validly existing as a limited liability company
in good standing under the Delaware LLC Act.
(iii) Holdings has been duly formed and is validly existing as a limited liability company in
good standing under the Delaware LLC Act.
(iv) Xxxxxxxx directly or indirectly owns all of the outstanding capital stock of each of WNGL
and WMNGL; all of such capital stock has been duly authorized and validly issued and is fully paid
and non-assessable; and such capital stock is owned free and clear of all liens, encumbrances,
security interests or claims (A) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming Xxxxxxxx as debtor is on file with the Secretary of
State of the State of Delaware, (B) in respect of which a financing statement under the Uniform
Commercial Code of the State of Oklahoma naming Xxxxxxxx as debtor is on file with the Oklahoma UCC
Central Filing Office – Oklahoma County Clerk or (B) otherwise known to such counsel, other than
those created by or arising under the DGCL.
(v) Xxxxxxxx owns a 100% limited liability company interest in XXX; such limited liability
company interest has been duly authorized and validly issued in accordance with the XXX LLC
Agreement and is fully paid (to the extent required under the XXX LLC Agreement) and non-assessable
(except as such non-assessability may be affected by Section 18-607 of the Delaware LLC Act); and
Xxxxxxxx owns such limited liability company interest free and clear of all liens, encumbrances,
security interests or claims (A) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming Xxxxxxxx as debtor is on file with the Secretary of
State of the State of Delaware, (B) in respect of which a financing statement under the Uniform
Commercial Code of the State of Oklahoma naming Xxxxxxxx as debtor is on file with the Oklahoma UCC
Central Filing Office – Oklahoma County Clerk or (C) otherwise known to such counsel, other than
those created by or arising under the Delaware LLC Act or the XXX LLC Agreement.
(vi) XXX owns a 100% limited liability company interest in Xxxxxxxx Pipeline; such limited
liability company interest has been duly and validly authorized and issued in accordance with the
Xxxxxxxx Pipeline LLC Agreement and is fully paid (to the extent required under the Xxxxxxxx
Pipeline LLC Agreement) and non-assessable (except as such non-assessability may be affected by
Section 18-607 of the Delaware LLC Act); and XXX owns such limited liability company interest free
and clear of all liens, encumbrances, security interests or claims (A) in respect of which a
financing statement under the Uniform Commercial Code of the State of Delaware naming XXX as debtor
is on file with the Secretary of State of the State of Delaware, (B) in respect of which a
financing statement under the Uniform Commercial Code of the State of Oklahoma naming XXX as debtor
is on file with the Oklahoma UCC Central Filing Office –
Exhibit C-1
Oklahoma County Clerk or (C) otherwise known to such counsel, other than those created by or
arising under the Delaware LLC Act or the Xxxxxxxx Pipeline LLC Agreement.
(vii) XXX owns all of the outstanding capital stock of each of Espagas and MAPCO; all of such
capital stock has been duly authorized and validly issued and is fully paid and non-assessable; and
such capital stock is owned free and clear of all liens, encumbrances, security interests or claims
(A) in respect of which a financing statement under the Uniform Commercial Code of the State of
Delaware naming XXX as debtor is on file with the Secretary of State of the State of Delaware, (B)
in respect of which a financing statement under the Uniform Commercial Code of the State of
Oklahoma naming XXX as debtor is on file with the Oklahoma UCC Central Filing Office – Oklahoma
County Clerk or (B) otherwise known to such counsel, other than those created by or arising under
the DGCL.
(viii) [MAPCO owns a 100% limited liability company interest in WE; such limited liability
company interest has been duly authorized and validly issued in accordance with the WE LLC
Agreement and is fully paid (to the extent required under the WE LLC Agreement) and non-assessable
(except as such non-assessability may be affected by Section 18-607 of the Delaware LLC Act); and
MAPCO owns such limited liability company interest free and clear of all liens, encumbrances,
security interests or claims (A) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming MAPCO as debtor is on file with the Secretary of
State of the State of Delaware, (B) in respect of which a financing statement under the Uniform
Commercial Code of the State of Oklahoma naming MAPCO as debtor is on file with the Oklahoma UCC
Central Filing Office – Oklahoma County Clerk or (C) otherwise known to such counsel, other than
those created by or arising under the Delaware LLC Act or the WE LLC Agreement.]
(ix) WE owns a 26.7% limited liability company interest in DPS; such limited liability company
interest has been duly authorized and validly issued in accordance with the DPS LLC Agreement, and
is fully paid (to the extent required under the DPS LLC Agreement) and non-assessable (except as
such non-assessability may be affected by Section 18-607 of the Delaware LLC Act); and WE owns such
limited liability company interest free and clear of all liens, encumbrances, security interests,
charges or claims (A) in respect of which a financing statement under the Uniform Commercial Code
of the State of Delaware naming WE as debtor is on file with the Secretary of State of the State of
Delaware, (B) in respect of which a financing statement under the Uniform Commercial Code of the
State of Oklahoma naming WE as debtor is on file with the Oklahoma UCC Central Filing Office –
Oklahoma County Clerk or (B) otherwise known to such counsel, other than those created by or
arising under the Delaware LLC Act or the DPS LLC Agreement.
(x) WMNGL, WNGL, MAPCO and Espagas collectively own all of the outstanding limited liability
company interests in Holdings; such limited liability company interests have been duly authorized
and validly issued in accordance with the Holdings LLC Agreement and are fully paid (to the extent
required under the Holdings LLC Agreement) and non-assessable (except as such non-assessability may
be affected by Section 18-607 of the Delaware LLC Act); and WMNGL, WNGL, MAPCO and Espagas own such
limited liability company interests free and clear of all liens, encumbrances, security interests
or claims (A) in respect of which a financing statement under the Uniform Commercial Code of the
State of Delaware naming
Exhibit C-2
WMNGL, WNGL, MAPCO or Espagas as debtor is on file with the Secretary of State of the State of
Delaware, (B) in respect of which a financing statement under the Uniform Commercial Code of the
State of Oklahoma naming WMNGL, WNGL, MAPCO or Espagas as debtor is on file with the Oklahoma UCC
Central Filing Office – Oklahoma County Clerk or (C) otherwise known to such counsel, other than
those created by or arising under the Delaware LLC Act or the Holdings LLC Agreement.
(xi) Each of the Operative Agreements to which any of the Xxxxxxxx Entities, other than the
Partnership Entities, is a party has been duly authorized and validly executed and delivered by
each of the Xxxxxxxx Entities party thereto.
(xii) The offering, issuance and sale by the Partnership of the Units, the execution, delivery
and performance by the Xxxxxxxx Entities (other than the Partnership Entities) of the Underwriting
Agreement or any of the Operative Agreements and the consummation of the transactions contemplated
thereby will not result in: (A) a violation of the certificate of incorporation, bylaws, limited
liability company agreement, limited partnership agreement or similar organizational document of
any of the Xxxxxxxx Entities (other than the Partnership Entities), (B) 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 or by which any of the Xxxxxxxx Entities
(other than the Partnership Entities) is bound or to which any of the property or assets of any of
the Xxxxxxxx Entities (other than the Partnership Entities) is subject (except for such indenture,
mortgage, deed of trust, loan agreement or other agreement covered by the opinion letter from
Xxxxxx, Xxxx & Xxxxxxxx LLP of even date herewith, to which such counsel need not opine), or (C)
any violation of any order, rule or regulation of any court or governmental agency or body having
jurisdiction over any of the Xxxxxxxx Entities (other than the Partnership Entities) or any of
their properties or assets, except any such conflicts, breaches, violations or defaults that would
not have a Material Adverse Effect.
(xiii) Except as described in the Prospectus or the Partnership Agreement, there are no
contracts, agreements or understandings between the any of the Xxxxxxxx Entities and any person
granting such person the right to require the Partnership to file a registration statement under
the Securities Act with respect to any securities of the Partnership Entities owned or to be owned
by such person or to require the Partnership to include such securities in the Units registered
pursuant to the Registration Statement or in any securities being registered pursuant to any other
registration statement filed by any of the Partnership Entities under the Securities Act.
(xiv) Other than as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which any of the Partnership Entities is a party or to which any property or
assets of any of the Partnership Entities is the subject which, if determined adversely to such
Partnership Entity, might (A) reasonably be expected to have a Material Adverse Effect, or (B)
subject the limited partners of the Partnership to any material liability or disability; and, to
such counsel’s knowledge, no such proceedings are threatened or contemplated by governmental
authorities or by others.
(xv) The Underwriting Agreement has been duly authorized, executed and delivered by each of
the Xxxxxxxx Parties (other than the Partnership Entities) party thereto.
Exhibit C-3
EXHIBIT D
FORM OF OPINION OF XXXXXX, XXXX & XXXXXXXX LLP
The offering, issuance and sale by the Partnership of the Units, the execution, delivery and
performance by the Xxxxxxxx Entities of the Underwriting Agreement or any of the Operative
Agreements to which they are a party and the consummation of the transactions contemplated thereby
will not conflict with or result in a breach 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 listed on Schedule A to such opinion.
Exhibit D-1
EXHIBIT E
FORM OF OPINION OF LOCAL COUNSEL
(i) No permit, consent, approval, authorization, order, registration, filing or qualification
of or with any court, governmental agency or body of the State of Kansas having jurisdiction over
the Xxxxxxxx Entities or any of their respective properties is required for the issuance and sale
of the Units by the Partnership or the conveyance of properties or evidence of title to properties
located in the State of Kansas purported to be conveyed by the Specific Conveyances except (A) as
may be required under state securities or “Blue Sky” laws as to which the undersigned does not
express any opinion, (B) for such permits, consents, approvals and similar authorizations which
have been obtained, and (C) which (1) are of a routine or administrative nature, (2) are not
customarily obtained or made prior to the consummation of transactions such as those contemplated
under the Underwriting Agreement and (3) are expected in the reasonable judgment of the General
Partner to be obtained in the ordinary course of business subsequent to consummation of the
Transactions or (D) as described in the Prospectus.
(ii) [Each of the Specific Conveyances is in a form legally sufficient as between the parties
thereto to convey to the transferee thereunder all of the right, title and interest of the
transferor stated therein in and to the properties located in the State of Kansas, as described in
the Specific Conveyances, subject to the conditions, reservations and limitations contained in the
Specific Conveyances and, upon proper recordation of the applicable Specific Conveyances in the
State of Kansas, will constitute notice to all third parties under the recordation statutes of the
State of Kansas concerning record title to the assets covered thereby. Recordation in the office
of the Register of Deeds of each county in which MCFS owns property is the appropriate public
office in the State of Kansas for the recordation of interests in real property located in such
county.]
(vi) [Each of the Specific Conveyances (including, without limitation, the form of the
exhibits and schedules thereto) is in a form legally sufficient for recordation in the appropriate
public offices of the State of [___], to the extent such recordation is required to evidence
title to the properties covered thereby in [MCFS ] [CTP] and, upon proper recordation of
the applicable Specific Conveyances in the State of [___], will constitute notice to all
third parties under the recordation statutes of the State of [___] concerning record title
to the assets covered thereby. Recordation in the office of the County Clerk of each county in
which [MCFS] [CTP] owns property is the appropriate public office in the State of [___] for
the recordation of interests in real property located in such county.]
(vii) [After consummation of the Transactions, [MCFS] [CTP] will be entitled to exercise the
power of eminent domain to secure rights-of-way necessary to operate such pipeline assets in the
State of [___].]
Such counsel’s opinions may be limited to the laws of the State of Kansas, excepting therefrom
municipal and local ordinances and regulations, and such counsel need express no opinion with
respect to (a) title to any of the real or personal property, (b) the accuracy of descriptions or
references to real or personal property, or (c) with respect to state or local taxes or tax
statutes to which any of the limited partners of the Xxxxxxxx Entities may be subject.
Exhibit E-1
EXHIBIT F
FORM OF OPINION OF SELLING UNITHOLDERS’ COUNSEL
(i) Each Selling Unitholder has full right, limited liability company power and authority, to
enter into this Agreement. The execution, delivery and performance of this Agreement by each
Selling Unitholder and the consummation by each Selling Unitholder of the transactions contemplated
hereby do not (i) 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, license or other agreement or instrument known to such counsel to which any Selling
Unitholder is a party or by which any Selling Unitholder is bound or to which any of the property
or assets of any Selling Unitholder is subject, (ii) result in any violation of the provisions of
the certificate of formation, limited liability company agreement (or similar organizational
documents) of any Selling Unitholder or (iii) result in any violation of any statute or any rule or
regulation, or any order known to such counsel issued by any court or governmental agency or body
having jurisdiction over any Selling Unitholder or the property or assets of any Selling
Unitholder.
(ii) Except for the registration of the Units under the Securities Act and such consents,
approvals, authorizations, registrations or qualifications as may be required under the Exchange
Act and applicable state or foreign securities laws in connection with the purchase and sale of the
Units by the Underwriters, no consent, approval, authorization or order of, or filing or
registration with, any court or governmental agency or body having jurisdiction over any Selling
Unitholder or the property or assets of any Selling Unitholder is required for the execution,
delivery and performance of this Agreement by any Selling Unitholder and the consummation by any
Selling Unitholder of the transactions contemplated hereby.
(iii) This Agreement has been duly and validly authorized, executed and delivered by or on
behalf of each Selling Unitholder.
(iv) Immediately prior to such Delivery Date, each Selling Unitholder had good and valid title
to, or a valid “security entitlement” within the meaning of Section 8-501 of the UCC in respect of,
the Common Units to be sold by such Selling Unitholder under the Agreement on such Delivery Date,
free and clear of all Liens, and full right, power and authority to sell, assign, transfer and
deliver such Common Units to be sold by such Selling Unitholder under the Agreement.
(vi) Upon payment for the Common Units to be sold by each Selling Unitholder, delivery of such
Common Units, as directed by the Underwriters, to Cede or such other nominee as may be designated
by DTC, registration of such Common Units in the name of Cede or such other nominee and the
crediting of such Common Units on the books of DTC to securities accounts of the Underwriters
(assuming that neither DTC nor any such Underwriter has notice of any adverse claim (within the
meaning of Section 8 105 of the UCC to such Stock), (i) DTC shall be a “protected purchaser” of
such Common Units within the meaning of Xxxxxxx 0 000 xx xxx XXX, (xx) under Section 8 501 of the
UCC, the Underwriters will acquire a valid security entitlement in respect of such Common Units and
(iii) no action based on any “adverse claim”, within the meaning of Section 8 102 of the UCC, to
such Common Units may be asserted against
Exhibit F-1
the Underwriters with respect to such security entitlement. For purposes of this opinion,
such counsel may assume that when such payment, delivery and crediting occur, (A) such Common Units
will have been registered in the name of Cede or another nominee designated by DTC, in each case on
the Partnership’s share registry in accordance the Partnership Agreement and applicable law, (B)
DTC will be registered as a “clearing corporation” within the meaning of Section 8 102 of the UCC
and (C) appropriate entries to the accounts of the several Underwriters on the records of DTC will
have been made pursuant to the UCC.
In rendering such opinion, such counsel may (i) state that its opinion is limited to matters
governed by the federal laws of the United States of America, the laws of the State of New York and
the Delaware LLC Act and that such counsel is not admitted in the State of Delaware.
Such counsel shall also have furnished to the Representative a written statement, addressed to
the Underwriters and dated such Delivery Date, in form and substance satisfactory to the
Representative, to the effect that (x) such counsel has acted as counsel to the Selling Unitholders
in connection with the preparation of the Registration Statement, and (y) based on the foregoing,
nothing has come to the attention of such counsel that causes it to believe that the Registration
Statement, as of the Effective Time, contained any untrue statement of a material fact or omitted
to state such a material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or that the Prospectus, as of its date and as of such Delivery
Date, contained or contains any untrue statement of a material fact or omitted or omits to state
such a material fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading. The foregoing
opinion and statement may be qualified by a statement to the effect that such counsel does not
assume any responsibility for the accuracy, completeness or fairness of the statements contained in
the Registration Statement or the Prospectus.
Exhibit F-2