Exhibit 1.1
1,250,000 Common Units
Representing Limited Partner Interests
UNDERWRITING AGREEMENT
June 24, 2003
UNDERWRITING AGREEMENT
June 24, 2003
UBS securities LLC
as Underwriter
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Ferrellgas Partners, L.P., a Delaware limited partnership (the
"Partnership"), the issuer of common units representing limited partner
interests in the Partnership ("Common Units"), proposes to issue and sell to UBS
Securities LLC (the "Underwriter") an aggregate of 1,104,600 Common Units
("Partnership Units"), and the unitholders of the Partnership named in Schedule
A annexed hereto (the "Selling Unitholders") propose to sell to the Underwriter
an aggregate of 145,400 Common Units as set forth in Schedule A ("Unitholder
Units") (the Partnership Units and the Unitholder Units together, the "Firm
Units"). In addition, solely for the purpose of covering over-allotments, the
Partnership proposes to grant to the Underwriter the option (the "Option") to
purchase from the Partnership up to an additional 187,500 Common Units (the
"Additional Units"). The Firm Units and the Additional Units are hereinafter
collectively sometimes referred to as the "Units." The Units are described in
the Final Prospectus which is referred to below.
The Partnership has prepared and filed, in accordance with the provisions
of the Securities Act of 1933, as amended, and the rules and regulations
thereunder (collectively, the "Act"), with the Securities and Exchange
Commission (the "Commission") (i) a registration statement on Form S-3 (File No.
333-103267), including a prospectus subject to completion relating to the Common
Units (the "S-3 Registration Statement") and (ii) two registration statements on
Form S-8 (File Nos. 333-87633 and 333-84344), each as amended by Post-Effective
Amendment No. 1 thereto, relating to the registration of, among others, the
Unitholder Units (the "S-8 Registration Statements"). The S-3 Registration
Statement and the S-8 Registration Statements (including all financial schedules
and exhibits), as amended when each became effective, or, if any such
registration statement became effective prior to the execution of this
Agreement, as supplemented or amended prior to the execution of this Agreement
are herein called the "Registration Statements." If it is contemplated, at the
time this Agreement is executed, that a post-effective amendment or
post-effective amendments to the S-3 Registration Statement or either S-8
Registration Statement will be filed and must be declared effective before the
offering of the Units may commence, the term "Registration Statements" as used
in this Agreement means such registration statements as amended by said
post-effective amendment or post-effective amendments. If it is contemplated, at
the time the Agreement is executed, that a registration statement or statements
will be filed pursuant to Rule 462(b) under the Act before the offering of the
Units may commence, the term "Registration Statements" as used in this Agreement
includes such registration statement or statements. The term "Basic Prospectus"
as used in this Agreement shall mean the prospectus contained in the S-3
Registration Statement at the time such Registration Statement was declared
effective or in the form in which it has been most recently filed with the
Commission on or prior to the date of this Agreement. The term "Reoffer
Prospectus" as used in this Agreement shall mean the prospectus contained in the
S-8 Registration Statements at the time such Registration Statements were
declared effective or in the form in which it has been most recently filed with
the Commission on or prior to the date of this Agreement. "Preliminary
Prospectus" shall mean any preliminary prospectus supplement or supplements to
the Basic Prospectus and the Reoffer Prospectus, together with the Basic
Prospectus and the Reoffer Prospectus, which describes the Units and the
offerings thereof, that is filed pursuant to Rule 424(b) under the Act ("Rule
424(b)") and is used prior to the filing of the Final Prospectus. "Final
Prospectus" shall mean the prospectus supplement relating to the Units and the
offering thereof that is first filed pursuant to Rule 424(b) after the date and
time this Agreement is executed and delivered by the parties hereto, together
with the Basic Prospectus and the Reoffer Prospectus, as applicable.
All references in this Agreement to financial statements and schedules and
other information which is "contained," " included " or "stated" in the
Registration Statements, the Basic Prospectus, the Reoffer Prospectus, the
Preliminary Prospectus or the Final Prospectus (or other references of like
import) shall be deemed to mean and include all such financial statements and
schedules and other information which is incorporated by reference in the
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Registration Statements, the Basic Prospectus, the Reoffer Prospectus, the
Preliminary Prospectus or the Final Prospectus, as the case may be; any
reference in this Agreement to the Registration Statements, the Basic
Prospectus, the Reoffer Prospectus, the Preliminary Prospectus or the Final
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 and Item 3 of Form S-8 under
the Act, as of the dates of the Registration Statements, the Basic Prospectus,
the Reoffer Prospectus, the Preliminary Prospectus or the Final Prospectus, as
the case may be; and any reference to any amendment or supplement to the
Registration Statements, the Basic Prospectus, the Reoffer Prospectus, the
Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and
include any documents filed after such date under the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") which, upon filing, are incorporated by
reference therein, as required by paragraph (b) of Item 12 of Form S-3. As used
herein, the term "Incorporated Documents" means the documents which at the time
are incorporated by reference in the Registration Statements, the Basic
Prospectus, the Reoffer Prospectus, the Preliminary Prospectus or the Final
Prospectus or any amendment or supplement thereto.
Ferrellgas, Inc., a Delaware corporation (the "General Partner"), is the
sole general partner of the Partnership and the sole general partner of
Ferrellgas, L.P. (the "Operating Partnership"). The Partnership, the Operating
Partnership and the General Partner are collectively referred to herein as the
"Ferrellgas Parties." The Ferrellgas Parties confirm as follows their agreements
with the Underwriter:
1. Sale and Purchase. Upon the basis of the warranties and representations
and subject to the terms and conditions herein set forth, the Partnership agrees
to sell to the Underwriter the Partnership Units and the Selling Unitholders
agree to sell to the Underwriter the Unitholder Units and the Underwriter agrees
to purchase the Firm Units at a purchase price of $22.55 per Unit. The
Partnership and the Selling Unitholders are advised by you that the Underwriter
intends initially to offer the Firm Units upon the terms set forth in the Final
Prospectus. You may from time to time increase or decrease the public offering
price after the initial public offering to such extent as you may determine.
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In addition, the Partnership hereby grants to the Underwriter the option to
purchase, and upon the basis of the warranties and representations and subject
to the terms and conditions herein set forth, the Underwriter shall have the
right to purchase from the Partnership all or a portion of the Additional Units
as may be necessary to cover over-allotments made in connection with the
offering of the Firm Units, at the same purchase price per unit to be paid by
the Underwriter to the Partnership and the Selling Unitholders for the Firm
Units. This option may be exercised by you at any time (but not more than once)
on or before the thirtieth day following the date hereof, by written notice to
the Partnership. Such notice shall set forth the aggregate number of Additional
Units as to which the option is being exercised, and the date and time when the
Additional Units are to be delivered (such date and time being herein referred
to as the additional time of purchase); provided, however, that the additional
time of purchase shall not be earlier than the time of purchase (as defined
below) nor earlier than the second business day [1] after the date on which the
option shall have been exercised nor later than the tenth business day after the
date on which the option shall have been exercised.
2. Payment and Delivery. Payment of the purchase price for the Partnership
Units shall be made to the Partnership and payment for the purchase price for
the Unitholder Units shall be made to the Selling Unitholders by Federal Funds
wire transfer, against delivery of the Firm Units to you through the facilities
of The Depository Trust Company for the account of the Underwriter. Such payment
and delivery shall be made at 10:00 A.M., New York City time, on June 27, 2003
(unless another time shall be agreed to in writing by you, the Partnership and
the Selling Unitholders). The time at which such payment and delivery of the
Firm Units are actually made is hereinafter sometimes called the time of
purchase.
[1] As used herein "business day" shall mean a day on which the New York Stock
Exchange is open for trading.
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Electronic transfer of the Firm Units shall be made to you at the time of
purchase in such names and in such denominations as you shall specify. Payment
of the purchase price for the Additional Units shall be made at the additional
time of purchase in the same manner and at the same office as the payment for
the Firm Units. Electronic transfer of the Additional Units shall be made to you
at the additional time of purchase in such names and such denominations as you
shall specify.
Deliveries of the documents described in Section 6 hereof with respect to
the purchase of the Units shall be made at the offices of Xxxxxx & Xxxxxx
L.L.P., 2300 First City Tower, 0000 Xxxxxx Xxxxxx, Xxxxxxx, Xxxxx, 00000, at
9:00 A.M., New York City time, on the date of the closing of the purchase of the
Firm Units or the Additional Units, as the case may be.
3. Representations and Warranties of the Partnership and the Selling
Unitholders. (a) Each of the Ferrellgas Parties, jointly and severally,
represents and warrants to and agrees with the Underwriter that:
(i) No order preventing or suspending the use of the Basic Prospectus,
the Reoffer Prospectus, or the Preliminary Prospectus has been issued by
the Commission, and the Basic Prospectus and the Reoffer Prospectus
included as part of any of the Registration Statements as originally filed
or as part of any amendment or supplement thereto, and the Preliminary
Prospectus filed pursuant to Rule 424(b), conformed when so filed in all
material respects with the requirements of the Act, and did not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Partnership by the
Underwriter expressly for use therein;
(ii) The Registration Statements in the form in which they became or
become effective and also in such form as they may be when any
post-effective amendment thereto shall become effective, and the Final
Prospectus and any supplement or amendment thereto when filed with the
Commission under Rule 424(b) and at the time of purchase and, if
applicable, at the additional time of purchase, conformed or will conform
in all material respects with the requirements of the Act, and did not or
will not at any such times contain an untrue statement of a material fact
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or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, and the statements made or
to be made by the Partnership in such documents within the coverage of Rule
175(b) under the Act, including any statements with respect to the
anticipated ratio of taxable income to distributions, were made or will be
made with a reasonable basis and in good faith; provided, however, that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Partnership by the Underwriter expressly for
use therein;
(iii) The Incorporated Documents heretofore filed, when they were
filed (or, if any amendment with respect to any such document was filed,
when such amendment was filed), conformed in all material respects with the
requirements of the Exchange Act; any further Incorporated Documents so
filed will, when they are filed, conform in all material respects with the
requirements of the Exchange Act; no such document when it was filed (or,
if an amendment with respect to any such document was filed, when such
amendment was filed), contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; and no such further document, when it
is filed will contain an untrue statement of a material fact or will omit
to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they
were made, not misleading;
(iv) Each of the Partnership and the Operating Partnership has been
duly formed and is validly existing as a limited partnership under the
Delaware Revised Uniform Limited Partnership Act (the "Delaware Act"), with
power and authority (partnership and other) to own or lease its properties
and to conduct its business, in each case as described in the Final
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Prospectus, and has been duly qualified or registered as a foreign limited
partnership for the transaction of business and is in good standing under
the laws of each jurisdiction in which it owns or leases property, or
conducts any business, so as to require such qualification or registration
(except where the failure to be so qualified or registered would not have a
material adverse effect upon the business, prospects, financial condition
or results of operations of the Ferrellgas Parties, taken as a whole, or
subject the Partnership or the holders of Common Units to any material
liability or disability);
(v) The General Partner has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the state of
Delaware, with power and authority (corporate and other) to own or lease
its properties, to conduct its business and to act as general partner of
the Partnership and of the Operating Partnership, in each case as described
in the Final Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or leases properties,
or conducts any business, so as to require such qualification (except where
the failure to be so qualified would not have a material adverse effect
upon the business, prospects, financial condition or results of operations
of the Ferrellgas Parties, taken as a whole, or subject the Partnership or
the holders of Common Units to any material liability or disability);
(vi) The General Partner is the sole general partner of the
Partnership with a general partner interest in the Partnership of 1.0%;
such general partner interest has been duly authorized and validly issued
and is fully paid (to the extent required); and the General Partner owns
such general partner interest free and clear of all liens, encumbrances,
charges or claims (except for such liens, encumbrances, charges or claims
as are not, individually or in the aggregate, material to the ownership,
use or value thereof or as disclosed in the Registration Statements and the
Final Prospectus (or any amendment or supplement thereto));
(vii) The General Partner is the sole general partner of the Operating
Partnership with a general partner interest in the Operating Partnership of
1.0101%; such general partner interest has been duly authorized and validly
issued and is fully paid (to the extent required); and the General Partner
owns such general partner interest free and clear of all liens,
encumbrances, charges or claims (except for such liens, encumbrances,
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charges or claims as are not, individually or in the aggregate, material to
the ownership, use or value thereof or as disclosed in the Registration
Statements and the Final Prospectus (or any amendment or supplement
thereto));
(viii) The Partnership is the sole limited partner of the Operating
Partnership, with a limited partner interest of 98.9899%; such limited
partner interest has been duly authorized by the Operating Partnership
Agreement (as defined below), and was validly issued and is fully paid and
non-assessable (except as non-assessability may be affected by certain
provisions of the Delaware Act); and the Partnership owns such limited
partner interest in the Operating Partnership free and clear of all liens,
encumbrances, charges or claims (except for such liens, encumbrances,
charges or claims as are not, individually or in the aggregate, material to
the ownership, use or value thereof or as disclosed in the Registration
Statements and the Final Prospectus (or any amendment or supplement
thereto));
(ix) All outstanding Common Units and the limited partner interests
represented thereby have been duly authorized and validly issued and are
fully paid and non-assessable (except as non-assessability may be affected
by certain provisions of the Delaware Act);
(x) The Partnership Units to be issued to the Underwriter and the
limited partner interests represented thereby are duly authorized and, when
issued and delivered against payment therefor as provided herein, will be
validly issued, fully paid and non-assessable (except as non-assessability
may be affected by certain provisions of the Delaware Act); and the
Unitholder Units and the limited partner interests represented thereby are
duly authorized and, when issued and paid for as provided herein and in
accordance with the Second Amended and Restated Ferrellgas Unit Option Plan
(the "Option Plan"), will be validly issued, fully paid and non-assessable
(except as non-assessability may be affected by certain provisions of the
Delaware Act);
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(xi) Except as disclosed in the Registration Statements and the Final
Prospectus (or any amendment or supplement thereto), there are no
preemptive rights or other rights to subscribe for or to purchase, nor any
restriction upon the voting or transfer of, any limited partner interests
in the Partnership or the Operating Partnership pursuant to the Fourth
Amended and Restated Agreement of Limited Partnership of the Partnership
(as it may be amended and restated at or prior to the time of purchase, the
"Partnership Agreement") or the Second Amended and Restated Agreement of
Limited Partnership of the Operating Partnership (as it may be amended and
restated at or prior to the time of purchase, the "Operating Partnership
Agreement," and together with the Partnership Agreement, the "Partnership
Agreements") or other governing documents or any agreement or other
instrument to which the Partnership or the Operating Partnership is a party
or by which either of them may be bound (except, in the case of
restrictions upon voting or transfer, where such restrictions would not
subject the Partnership or the holders of Common Units to any material
liability or disability); the capitalization of the Partnership is in all
material respects as described in the Final Prospectus under the caption
"Capitalization," and the Common Units, the Senior Units (as defined in the
Partnership Agreement) and the Partnership Agreements conform in all
material respects to the descriptions thereof contained in the Final
Prospectus;
(xii) All of the outstanding shares of capital stock of the General
Partner have been duly authorized and validly issued and are fully paid and
non-assessable; and all of such shares are owned by Xxxxxxx Companies, Inc.
("Xxxxxxx"), free and clear of all liens, encumbrances, equities or claims
(except for such liens, encumbrances, equities or claims as are not,
individually or in the aggregate, material to the ownership, use or value
thereof or as disclosed in the Registration Statements and the Final
Prospectus (or any amendment or supplement thereto));
(xiii) The execution and delivery of, and the performance by each of
the Ferrellgas Parties of their respective obligations under, this
Agreement have been duly authorized by each of the Ferrellgas Parties, and
this Agreement has been duly executed and delivered by each of the
Ferrellgas Parties and constitutes the valid and legally binding agreement
of each of the Ferrellgas Parties, enforceable against each of them in
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accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles, and limitations under federal or state securities laws
with respect to the rights to indemnification or contribution hereunder;
the Partnership Agreement has been duly authorized, executed and delivered
by the General Partner for itself and as attorney-in-fact for each of the
limited partners of the Partnership pursuant to the powers of attorney
granted by the Partnership Agreement, and is a valid and legally binding
agreement of the General Partner and each of the limited partners of the
Partnership, enforceable against the General Partner and each of the
limited partners of the Partnership in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; the Operating
Partnership Agreement has been duly authorized, executed and delivered by
the General Partner and the Partnership and is a valid and legally binding
agreement of the General Partner and the Partnership, enforceable against
the General Partner and the Partnership in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles;
(xiv) The issuance and sale of the Units by the Partnership, and the
execution, delivery and performance by the Ferrellgas Parties of this
Agreement and the consummation by each of the Ferrellgas Parties of the
transactions contemplated hereby 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 or
other agreement or instrument to which any of the Ferrellgas Parties is a
party or by which any of the Ferrellgas Parties is bound or to which any of
their properties or assets is subject, (ii) result in any violation of the
provisions of the certificate or agreement of limited partnership or of the
charter or bylaws or other organizational documents of any of the
Ferrellgas Parties or (iii) result in a violation of any statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over any of them or any of their properties, except in
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the case of clause (i) or (iii) where such conflict, breach, violation or
default will not prevent the consummation of the transactions contemplated
herein and would not have a material adverse effect upon the business,
prospects, financial condition or results of operations of the Ferrellgas
Parties, taken as a whole, or subject the Partnership or the holders of
Common Units to any material liability or disability; and no consent,
approval, authorization, order, registration or qualification of or with
any such court or governmental agency or body is required for the issuance
and sale of the Units by the Partnership or the consummation by the
Ferrellgas Parties of the transactions contemplated hereby, except (i) the
registration under the Act of the Units or (ii) such consents, approvals,
authorizations, orders, registrations or qualifications (A) as have been,
or prior to the time of purchase will be, obtained or (B) as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Units by the Underwriter;
(xv) Except as disclosed in the Registration Statements and the Final
Prospectus (or any amendment or supplement thereto), there are no legal or
governmental proceedings pending to which any of the Ferrellgas Parties is
a party or of which any of their respective properties is the subject,
which, if determined adversely to such person, would, individually or in
the aggregate, have material adverse effect upon the business, prospects,
financial condition or results of operations of the Ferrellgas Parties,
taken as a whole; and to the knowledge of the Ferrellgas Parties, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(xvi) The statements made in the Final Prospectus under the caption
"Description of Common Units, Senior Units and Deferred Participation
Units," insofar as they purport to constitute summaries of the terms of the
Common Units, Senior Units and Deferred Participation Units, under the
caption "Tax Consequences", under the caption "Tax Considerations", and
under the caption "Conflicts of Interest and Fiduciary Responsibilities"
insofar as they describe the provisions of the documents therein described,
are accurate, complete and fair summaries in all material respects;
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(xvii) Each of the Ferrellgas Parties carries, or is covered by,
insurance in such amounts and covering such risks as is customarily
obtained by businesses similarly situated, taking into account
self-insurance;
(xviii) None of the Ferrellgas Parties is in, nor will consummation of
the transactions contemplated hereby result in: (i) violation of its
agreement of limited partnership or charter, as the case may be; or (ii)
default (and no event has occurred which, with notice or lapse of time or
both, would constitute such a default) in the due performance or observance
of any term, covenant or condition contained in any agreement, indenture or
instrument to which it or its property may be subject, or violation of any
law, ordinance, governmental rule, regulation or court decree to which it
or its property may be subject, which default or violation, individually or
in the aggregate, would have a material adverse effect upon the business,
prospects, financial condition or results of operations of the Ferrellgas
Parties, taken as a whole, or subject the Partnership or the holders of
Common Units to any material liability or disability;
(xix) Except as disclosed in the Registration Statements and the Final
Prospectus (or any amendment or supplement thereto), each of the Ferrellgas
Parties possess, and are operating in compliance in all material respects
with, all certificates, authorities or permits issued by the appropriate
local, state, federal or foreign regulatory agencies or bodies necessary to
conduct the business currently (or, as described or contemplated in the
Final Prospectus, to be) operated by them, except for such certificates,
authorizations or permits which, if not obtained, would not have,
individually or in the aggregate, a material adverse effect upon the
ability of the Ferrellgas Parties to conduct their businesses in all
material respects as currently conducted and as contemplated by the Final
Prospectus to be conducted; and, except as disclosed in the Registration
Statements and the Final Prospectus (or any amendment or supplement
thereto), none of the Ferrellgas Parties has received any notice of
proceedings relating to the revocation or modification of any such
certificate, authorization or permit which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or filing,
would have a material adverse effect upon the ability of the Ferrellgas
Parties to conduct their businesses in all material respects as currently
conducted and as contemplated by the Final Prospectus to be conducted;
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(xx) None of the Ferrellgas Parties has any subsidiaries (other than
the Partnership and the Operating Partnership themselves) which,
individually or considered as a whole, would be deemed to be a significant
subsidiary (as defined in Rule 405 under the Act);
(xxi) The financial statements (including the related notes and
supporting schedules) included in the Registration Statements and the Final
Prospectus (and any amendment or supplement thereto) present fairly in all
material respects the financial position, results of operations and cash
flows of the entities purported to be shown thereby, at the dates and for
the periods indicated, and have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods indicated, except to the extent disclosed therein. The other
financial information set forth in the Registration Statements or the Final
Prospectus accurately presented in all material respects and prepared on a
basis consistent with the audited and unaudited historical consolidated
financial statements from which it has been derived, except as disclosed
therein. The pro forma financial statements and other pro forma financial
information included or incorporated by reference in the Registration
Statements or the Final Prospectus (i) present fairly in all material
respects the information shown therein, (ii) have been prepared in
accordance with the Commission's rules and guidelines with respect to pro
forma financial statements and (iii) have been properly computed on the
bases described therein. The assumptions used in the preparation of the pro
forma financial statements and other pro forma financial information
included or incorporated by reference in the Registration Statements or the
Final Prospectus are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances referred to
therein. No other financial statements or schedules of the Partnership are
required by the Act or the Exchange Act to be included in the Registration
Statements or the Final Prospectus; and the Partnership and the Ferrellgas
Parties do not have any material liabilities or obligations, direct or
contingent (including any off-balance sheet obligations), not disclosed in
the Registration Statements and the Prospectus.
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(xxii) Except as disclosed in the Registration Statements and the
Final Prospectus (or any amendment or supplement thereto), subsequent to
the respective dates as of which such information is given in the
Registration Statements and the Final Prospectus (or any amendment or
supplement thereto), (i) none of the Ferrellgas Parties has incurred any
liability or obligation, indirect, direct or contingent (including
off-balance sheet obligations), or entered into any transactions, not in
the ordinary course of business, that, singly or in the aggregate, is
material to the Ferrellgas Parties, taken as a whole, (ii) there has not
been any material change in the capitalization, or material increase in the
short-term debt or long-term debt, of the Partnership and the Operating
Partnership, taken as a whole, and (iii) there has not been any material
adverse change, or any development involving or which may reasonably be
expected to involve, singly or in the aggregate, a prospective material
adverse change in the business, prospects, financial condition or results
of operations of the Ferrellgas Parties, taken as a whole;
(xxiii) There are no legal or governmental proceedings pending or, to
the knowledge of the Ferrellgas Parties, threatened, against any of the
Ferrellgas Parties or any of their subsidiaries, or to which any of the
Ferrellgas Parties or any of their subsidiaries is a party, or to which any
of their respective properties is subject, that are required to be
described in the Registration Statements or the Final Prospectus but are
not described as required; there are no agreements, contracts, indentures,
leases or other instruments that are required to be described in the
Registration Statements or the Final Prospectus or to be filed as an
exhibit to any of the Registration Statements that are not described or
filed as required by the Act; and there are no relationships or
transactions with management or affiliates of the Partnership that are
required to be described in the Registration Statements or the Final
Prospectus that are not so described as required by the Act;
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(xxiv) The Ferrellgas Parties and their subsidiaries have good and
marketable title to all real property and good title to all personal
property described in the Final Prospectus as being owned by them, free and
clear of all liens, claims, security interests or other encumbrances except
(i) as described in the Final Prospectus and (ii) such as do not materially
interfere with the use of such properties, taken as a whole, as described
in the Final Prospectus, including liens, claims, security interests and
other encumbrances pursuant to mortgage and/or security agreements given as
security for certain non-compete agreements with the prior owners of
certain businesses previously acquired by the Ferrellgas Parties and their
subsidiaries; and all real property and buildings held under lease by any
of the Ferrellgas Parties or any of their subsidiaries are held under valid
and subsisting and enforceable leases with such exceptions as do not
materially interfere with the use of such properties, taken as a whole, as
described in the Final Prospectus;
(xxv) Except as disclosed in the Registration Statements and the Final
Prospectus (or any amendment or supplement thereto) and except as would not
have a material adverse effect upon the business, prospects, financial
condition or results of operations of the Ferrellgas Parties, taken as a
whole, (i) none of the Ferrellgas Parties or their subsidiaries is in
violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code or rule of common law, including any judicial
or administrative order, consent, decree or judgment, relating to pollution
or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or to
the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (ii) the Ferrellgas Parties and their subsidiaries
have all permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with their
requirements, (iii) there are no pending or, to the knowledge of the
Ferrellgas Parties, threatened administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigation or proceedings relating to any
-15-
Environmental Law against the Ferrellgas Parties or any of their
subsidiaries or any of their respective properties, and (iv) there are no
events or circumstances that might reasonably be expected to form the basis
of an order for clean-up or remediation, or an action, suit or proceeding
by any private party or governmental body or agency, against the Ferrellgas
Parties or any of their subsidiaries or any of their respective properties
relating to Hazardous Materials or any Environmental Laws;
(xxvi) None of the Ferrellgas Parties has taken, and none of such
entities shall take any action that would result in a violation of Section
242.102 of Regulation M promulgated under the Exchange Act in connection
with the sale of the Common Units;
(xxvii) Deloitte & Touche LLP, who have certified certain financial
statements of the Partnership and the General Partner included in the
Registration Statements and the Final Prospectus, are independent public
accountants with respect to the Partnership and the General Partner as
required by the Act;
(xxviii) Each of the Ferrellgas Parties is, and after giving effect to
the offering and the sale of the Units, will be, exempt from regulation as
an "investment company," a person "controlled by" an "investment company"
or an "affiliated person" of or "promoter" or "principal underwriter" for
an "investment company," as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(xxix) Each of the Ferrellgas Parties is, and after giving effect to
the offering and the sale of the Units, will be, exempt from regulation as
a "holding company" or a "subsidiary company" of a "holding company"
thereof within the meaning of the Public Utility Holding Company Act of
1935, as amended;
(xxx) The Partnership maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary (A) to permit
-16-
preparation of financial statements in conformity with generally accepted
accounting principles or any other criteria applicable to such statements
and (B) to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is
taken with respect to any differences;
(xxxi) The Partnership has established and maintains disclosure
controls and procedures (as such terms are defined in Rule 13a-14 and
15d-14 under the Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Partnership,
including its consolidated subsidiaries, is made known to the General
Partner's Chief Executive Officer and Chief Financial Officer by others
within the General Partner, and such disclosure controls and procedures are
effective to ensure that material information relating to the Partnership,
including its consolidated subsidiaries, is made known to the General
Partner's Chief Executive Officer and Chief Financial Officer by others
within the General Partner; the Partnership's auditors and the Audit
Committee of the Board of Directors of the General Partner have been
advised of: (i) any significant deficiencies in the design or operation of
internal controls which could adversely affect the Partnership's ability to
record, process, summarize, and report financial data; and (ii) any fraud,
whether or not material, that involves management or other employees who
have a role in the Partnership's internal controls; any material weaknesses
in internal controls have been identified for the Partnership's auditors;
and since the date of the most recent evaluation of the effectiveness of
the design and operation of the Partnership's disclosure controls and
procedures, there have been no significant changes in internal controls or
in other factors that could significantly affect internal controls,
including no corrective actions with respect to significant deficiencies
and material weaknesses in the Partnership's internal controls; and
(xxxii) Subject to the provisions of Sections 13(k)(2) and (3) of the
Exchange Act and since July 30, 2002, the Partnership has not, directly or
indirectly, including through any subsidiary, extended credit, arranged to
extend credit, or renewed any extension of credit, in the form of a
personal loan, to or for any director or executive officer of the General
-17-
Partner; except, with respect to any extension of credit maintained by the
Partnership on July 30, 2002, for which there has been no material
modification to any term of any such extension of credit or any renewal of
such extension of credit on or after July 30, 2002.
(b) Each Selling Unitholder represents and warrants to the Underwriter
that:
(i) The Selling Unitholder has, or prior to the time of the purchase
will have, irrevocably exercised its option to purchase his Unitholder
Units in accordance with the Option Plan;
(ii) The Selling Unitholder has granted an irrevocable power of
attorney pursuant to a Custody Agreement and Power of Attorney dated on or
prior to the date hereof (the `Power of Attorney") to the person named
therein, on behalf of the Selling Unitholder, to execute and deliver this
Agreement and any other documents necessary or desirable in connection with
the transactions contemplated hereby;
(iii) The Selling Unitholder has, or prior to the time of purchase
will have, valid and unencumbered title to the Unitholder Units to be
delivered by the Selling Unitholder at the time of purchase and full right,
power and authority to enter into this Agreement and the Power of Attorney
and to sell, assign, transfer and deliver the Unitholder Units to be
delivered on behalf of the Selling Unitholder at the time of purchase and
upon delivery of and payment for the Unitholder Units at the time of
purchase the Underwriter will acquire valid and unencumbered title to the
Unitholder Units to be delivered by the Partnership on behalf of the
Selling Unitholder at the time of purchase;
(iv) The Power of Attorney has been duly executed and delivered by the
Selling Unitholder and this Agreement has been duly executed and delivered
on behalf of the Selling Unitholder by the Attorney-in-Fact (as defined in
the Power of Attorney), and each of the Power of Attorney and this
Agreement constitutes the valid and legally binding agreement of the
Selling Unitholder, enforceable against him in accordance with its terms,
subject to bankruptcy,
-18-
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
and to general equity principles, and, with respect to this Agreement,
limitations under federal or state securities laws with respect to the
rights to indemnification or contribution hereunder;
(v) The sale of the Unitholder Units by the Selling Unitholder, and
the execution, delivery and performance by the Selling Unitholder of this
Agreement and the Power of Attorney and the consummation by the Selling
Unitholder of the transactions contemplated hereby will not conflict with
or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Selling Unitholder
is a party or by which the Selling Unitholder may be bound or to which his
properties or assets is subject; and no consent, approval, authorization,
order, registration or qualification of or with any court or governmental
agency or body is required for the sale of the Units by the Selling
Unitholder or the consummation by the Selling Unitholder of the
transactions contemplated hereby, except (i) the registration under the Act
of the Unitholder Units or (ii) such consents, approvals, authorizations,
orders, registrations or qualifications (A) as have been, or prior to the
time of purchase will be, obtained, or (B) as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Unitholder Units by the Selling Unitholder;
(vi) The Final Prospectus and any supplement or amendment thereto when
filed with the Commission under Rule 424(b) and at the time of purchase
and, if applicable, at the additional time of purchase, conformed or will
conform in all material respects with the requirements of the Act, and did
not or will not at any such times contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however,
that this representation and warranty by the Selling Unitholder in such
capacity shall apply only to the statements with respect to such Unitholder
set forth in the Final Prospectus under the heading "--Selling
Unitholders;" and
-19-
(vii) There are no contracts, agreements or understandings between the
Selling Unitholder and any person that would give rise to a valid claim
against the Partnership or the Underwriter for a brokerage commission,
finder's fee or other like payment.
4. Certain Covenants of the Partnership and the Selling Unitholders.
(a) Each of the Partnership and the General Partner hereby agrees:
(i) to furnish such information as may be required and otherwise to
cooperate in qualifying the Units for offering and sale under the
securities or blue sky laws of such states as you may designate and to
maintain such qualifications in effect so long as required for the
distribution of the Units; provided that the Partnership shall not be
required to qualify as a foreign partnership or to consent to the service
of process under the laws of any such state (except service of process with
respect to the offering and sale of the Units); and to promptly advise you
of the receipt by the Partnership of any notification with respect to the
suspension of the qualification of the Units for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose;
(ii) during the period of time referred to in the second sentence in
sub-paragraph (v) below, to advise you and counsel for the Underwriter
promptly and, if requested by you, to confirm such advice in writing: (i)
of any request by the Commission for amendment of or a supplement to any of
the Registration Statements, the Basic Prospectus, the Reoffer Prospectus,
the Preliminary Prospectus or the Final Prospectus or for additional
information; (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of any of the Registration Statements or of
the suspension of qualification of the Units for offering or sale in any
jurisdiction or the initiation of any proceeding for such purpose; and
(iii) of any change in the business, prospects, financial condition or
results of operations of any of the Ferrellgas Parties, or of the happening
of any event, which makes any statement of a material fact made in the
Registration Statements, the Preliminary Prospectus or the Final Prospectus
(as then amended or supplemented) untrue or that requires the making of any
additions to or changes in the Registration Statements, the Preliminary
Prospectus or the Final Prospectus (as then amended or supplemented) in
order to state a material fact required by the Act to be stated therein or
necessary in order to make the statements therein not misleading, or of the
necessity to amend or supplement the Preliminary Prospectus or the Final
Prospectus (as then amended or supplemented) to comply with the Act or any
other law. If at any time within the period of time referred to in the
second sentence in sub-paragraph (v) below, the Commission shall issue any
stop order suspending the effectiveness of any of the Registration
Statements, the Partnership and the General Partner will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible time;
-20-
(iii) to furnish to you, at your request and without charge, (i) one
signed copy of each of the Registration Statements as originally filed with
the Commission and of each amendment thereto, including financial
statements and all exhibits to the Registration Statements, (ii) such
number of conformed copies of the Registration Statements as originally
filed and of each amendment thereto, but without exhibits, as you may
request, (iii) such number of copies of the Incorporated Documents, without
exhibits, as you may request, and (iv) such number of copies of the
exhibits to the Incorporated Documents as you may request;
(iv) prior to the end of the period of time referred to in the second
sentence in sub-paragraph (v) below, not to file any amendment to the
Registration Statements or make any amendment or supplement to the
Preliminary Prospectus or the Final Prospectus, or file any document that,
upon filing, becomes an Incorporated Document, of which you and counsel for
the Underwriter shall not previously have been advised or to which, after
you and counsel for the Underwriter shall have received a copy of the
document proposed to be filed, you shall reasonably object; provided that
your consent shall not be unreasonably withheld or delayed;
(v) to cause the Final Prospectus to be filed pursuant to, and in
compliance with, Rule 424(b). As soon after the execution and delivery of
this Agreement as possible and thereafter from time to time for such period
as in the opinion of counsel for the Underwriter a prospectus is required
by the Act to be delivered in connection with sales of the Units by the
-21-
Underwriter or dealer, the Partnership and the General Partner will
expeditiously deliver to the Underwriter and each dealer, without charge,
as many copies of the Final Prospectus (and of any amendment or supplement
thereto) as you may reasonably request. The Partnership and the General
Partner consent to the use of the Preliminary Prospectus or the Final
Prospectus (and of any amendment or supplement thereto) in accordance with
the provisions of the Act and with the securities or Blue Sky laws of the
jurisdictions in which the Units are offered by Underwriter and by all
dealers to whom Units may be sold, both in connection with the offering and
sale of the Units and for such period of time thereafter as the Final
Prospectus is required by the Act to be delivered in connection with sales
of the Units by the Underwriter or dealer. If during such period of time
any event shall occur that in the judgment of the Partnership or the
General Partner or in the opinion of counsel for the Underwriter is
required to be set forth in the Final Prospectus (as then amended or
supplemented) or should be set forth therein in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary to supplement or amend the
Final Prospectus (or to file under the Exchange Act any document that, upon
filing, becomes an Incorporated Document) in order to comply with the Act
or any other law, the Partnership and the General Partner will forthwith
prepare and, subject to the provisions of sub-paragraph (iv) above, file
with the Commission an appropriate supplement or amendment thereto (or to
such document), and will expeditiously furnish to the Underwriter and
dealers a reasonable number of copies thereof. In the event that the
Partnership or the General Partner and the Underwriter agree that the Final
Prospectus should be amended or supplemented, the Partnership and the
General Partner, if requested by you, will promptly issue a press release
announcing or disclosing the matters to be covered by the proposed
amendment or supplement;
(vi) to make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the
"effective date of the Registration Statement" (as defined in Rule 158(c)
of the Act), where the relevant registration statement is the S-3
Registration Statement, an earnings statement of the Partnership (which
need not be audited) complying with Section 11(a) of the Act;
-22-
(vii) to apply the net proceeds from the sale of the Units in the
manner set forth under the caption "Use of Proceeds" in the Final
Prospectus;
(viii) not to issue, sell, offer or agree to sell, contract to sell,
grant any option to sell or otherwise dispose of, directly or indirectly,
any Common Units or securities convertible into or exchangeable or
exercisable for Common Units (including, but not limited to, any Senior
Units) or warrants or other rights to purchase Common Units or any other
securities of the Partnership that are substantially similar to Common
Units or permit the registration under the Act of any Common Units or
Senior Units, except for the registration of the Units and the sales to the
Underwriter pursuant to this Agreement and except for (i) issuances of
Common Units upon the exercise of outstanding options, (ii) the issuance of
Common Units upon conversion of Senior Units as required by lenders to whom
the Senior Units are pledged, (iii) the registration of Senior Units or
Common Units issued upon conversion of Senior Units as required by lenders
to whom the Senior Units are pledged, or (iv) issuances of Common Units in
connection with the acquisition of assets, businesses or the capital stock
or other ownership of businesses by the Partnership or the Operating
Partnership if the recipient(s) of such Common Units agree in writing to
substantially similar terms to the terms of the letters referred to in
Section 6(h) of this Agreement during the balance of the period covered by
those letters, which agreement shall name the Underwriter as an intended
beneficiary, for a period of ninety days after the date hereof, without the
prior written consent of the Underwriter;
(ix) if any Selling Unitholder shall default in his obligation to sell
and deliver all his Unitholder Units set forth in Schedule A hereto (such
Selling Unitholder being referred to herein as a "Defaulting Unitholder")
to the Underwriter at the time of purchase, the Partnership, in addition to
its obligations to sell and deliver the Partnership Units to the
Underwriter, shall sell and deliver to the Underwriter that number of
additional Common Units equal to the number of Unitholder Units which the
-23-
Defaulting Unitholder failed to sell and deliver as provided herein at the
time of purchase and the Underwriter will pay the purchase price for those
additional Common Units to the Partnership in accordance with Section 2
hereof, it being understood that, in such event, all references herein to
Partnership Units shall include such additional Common Units;
(x) to use its best efforts to cause the Common Units to be listed on
the NYSE; and
(xi) to pay all expenses, fees and taxes (other than any transfer
taxes and fees and disbursements of counsel for the Underwriter except as
set forth under Section 5 hereof or (iii) below) in connection with (i) the
preparation and filing of the Registration Statements, the Preliminary
Prospectus, the Reoffer Prospectus, the Final Prospectus, and any
amendments or supplements thereto, and the printing and furnishing of
copies of each thereof to the Underwriter and to dealers (including costs
of mailing and shipment), (ii) the issuance, sale and delivery of the Units
by the Partnership, (iii) the qualification of the Units for offering and
sale under state laws and the determination of their eligibility for
investment under state law as aforesaid (including the legal fees and
filing fees and other disbursements of counsel to the Underwriter) and the
printing and furnishing of copies of any blue sky surveys or legal
investment surveys to the Underwriter and to dealers, (iv) any listing of
the Units on any securities exchange and any registration thereof under the
Exchange Act, (v) the filing for review of the public offering of the Units
by the National Association of Securities Dealers, Inc., and (vi) the
performance of the Partnership's other obligations hereunder.
(b) Each Selling Unitholder hereby agrees:
(i) To sign letters acceptable to the Underwriter to the effect
that he shall not sell, offer or agree to sell, contract to sell,
grant any option to sell or otherwise dispose of, directly or
indirectly, any Common Units or securities convertible into or
exchangeable or exercisable for Common Units (including, but not
limited to, any Senior Units) or warrants or other rights to purchase
Common Units or any other securities of the Partnership that are
substantially similar to the Common Units for a period of 90 days
-24-
after the date of the Final Prospectus without the Underwriter's prior
written consent or as otherwise set forth therein;
(ii) In connection with the Units, not to, and to cause each of
his affiliates not to (other than the Ferrellgas Parties, as to which
the Selling Unitholder makes no covenant), take, directly or
indirectly, any action designed to cause or result, or that has
constituted or might reasonably constitute, the stabilization or
manipulation of the price of any securities of the Partnership; and
(iii) During the period of time referred to in the second
sentence of sub-paragraph (a)(v) above, to advise you and counsel for
the Underwriter promptly and, if requested by you, to confirm such
advice in writing, of any change in the information with respect to
such Selling Unitholder set forth in the Preliminary Prospectus or
Final Prospectus under the heading "Selling Unitholder."
5. Reimbursement of Underwriters' Expenses. If the Units are not delivered
for any reason other than the termination of this Agreement pursuant to the
first two paragraphs of Section 7 hereof, the Partnership shall, in addition to
paying the amounts described in Section 4(a)(x) hereof, reimburse the
Underwriter for all of its out-of-pocket expenses, including the fees and
disbursements of its counsel.
6. Conditions of Underwriter's Obligations. The obligations of the
Underwriter hereunder are subject to the accuracy of the representations and
warranties set forth in this Agreement on the part of the Partnership and the
Selling Unitholders on the date hereof and at the time of purchase (and the
obligations of the Underwriter at the additional time of purchase are subject to
the accuracy of the representations and warranties set forth in this Agreement
on the part of the Partnership and the Selling Unitholders on the date hereof
and at the time of purchase (unless previously waived) and at the additional
time of purchase, as the case may be), the performance by the Partnership and
the Selling Unitholders of their obligations hereunder and to the following
additional conditions precedent:
-25-
(a) The Partnership shall furnish to you at the time of purchase and at
the additional time of purchase, as the case may be, an opinion of Mayer, Brown,
Xxxx & Maw, counsel for the Partnership, addressed to the Underwriter, and dated
the time of purchase or the additional time of purchase, as the case may be,
with reproduced copies for each of the other Underwriters and in form
satisfactory to Xxxxxx & Xxxxxx L.L.P., counsel for the Underwriter, stating
that:
(i) Each of the Partnership and the Operating Partnership has been
duly formed and is validly existing as a limited partnership under the
Delaware Act, with power and authority to own or lease its properties and
to conduct its business as described in the Final Prospectus;
(ii) The General Partner has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own or lease its
properties, to conduct its businesses and to act as general partner of the
Partnership and of the Operating Partnership, in each case as described in
the Final Prospectus;
(iii) The Partnership is duly qualified or registered as a foreign
limited partnership for the transaction of business and is in good standing
under the laws of the State of Missouri;
(iv) The Operating Partnership is duly qualified or registered as a
foreign limited partnership to transact business and is in good standing
under the laws of the State of Missouri;
(v) The General Partner is duly qualified or registered as a foreign
corporation and is in good standing under the laws of the State of
Missouri;
(vi) The General Partner is the sole general partner of the
Partnership and the Operating Partnership with a general partner interest
in the Partnership of 1.0% and a general partner interest in the Operating
Partnership of 1.0101%; such general partner interests have been duly
authorized and validly issued and are fully paid, and are owned by the
General Partner free and clear of all liens, encumbrances, charges or
claims of record (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 in the office of the Secretary of State of the State
of Delaware or
-26-
(B) otherwise known to such counsel, other than those created by or arising
under the Delaware Act;
(vii) The Partnership is the sole limited partner of the Operating
Partnership, with a limited partner interest of 98.9899%; such limited
partner interest has been duly authorized and validly issued and is fully
paid and non-assessable (except as non-assessability may be affected by
certain provisions of the Delaware Act); and, the Partnership owns such
limited partner interest in the Operating Partnership free and clear of all
liens, encumbrances, charges or claims of record (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 in the office of the
Secretary of State of the State of Delaware or (B) otherwise known to such
counsel, other than those created by or arising under the Delaware Act or
disclosed in the Registration Statements and the Final Prospectus (or any
amendment or supplement thereto);
(viii) The Partnership Units issued to the Underwriter, including any
Additional Units that may be issued at the time of purchase or the
additional time of purchase, as the case may be, and the limited partner
interests represented thereby have been duly authorized and, when issued
and delivered against payment therefor as provided herein, will be validly
issued, fully paid and non-assessable (except as non-assessability may be
affected by certain provisions of the Delaware Act);
(ix) The Unitholder Units and the limited partner interests
represented thereby have been duly authorized and, when issued and paid for
in accordance with the terms of the Option Plan, will be validly issued,
fully paid and non-assessable (except as non-assessability may be affected
by certain provisions of the Delaware Act).
(x) Except as disclosed in the Registration Statements and the Final
Prospectus (or any amendment or supplement thereto), there are no
preemptive rights or other rights to subscribe for or to purchase, nor any
restriction upon the voting or transfer of, any limited partner interests
in the Partnership or the Operating Partnership pursuant to either of the
Partnership Agreements or other governing
-27-
documents or any agreement or other instrument identified in any exhibit
list to the Incorporated Documents to which the Partnership or the
Operating Partnership is a party or by which either of them is bound
(except, in the case of restrictions upon voting or transfer, where such
restrictions would not subject the Partnership or the holders of Common
Units to any material liability or disability);
(xi) The Partnership Agreement, the Operating Partnership Agreement
and this Agreement have been duly authorized, executed and delivered by
each of the Ferrellgas Parties, as the case may be, the Power of Attorney
has been duly executed and delivered by the Selling Unitholders and this
Agreement has been duly executed and delivered by the Attorney-in-Fact on
behalf of the Selling Unitholders pursuant to the Power of Attorney, and
each of the Partnership Agreement and the Operating Partnership Agreement
constitutes a valid and legally binding agreement of each of the Ferrellgas
Parties, as the case may be, enforceable against such person, as the case
may be, in accordance with their respective terms, in each case, subject to
(A) bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles, (B) limitations imposed
by public policy, applicable law relating to fiduciary duties and the
judicial imposition of an implied covenant of good faith and fair dealing
and (C) limitations under federal or state securities laws with respect to
the rights to indemnification or contribution hereunder;
(xii) The statements set forth in the Final Prospectus under the
caption "Description of Common Units, Senior Units and Deferred Partnership
Units" insofar as they purport to constitute summaries of the terms of the
Common Units, Senior Units and Deferred Partnership Units, under the
caption "Tax Consequences", under the caption "Tax Considerations" insofar
as they describe the provisions of the documents therein described, are
accurate, complete and fair summaries in all material respects;
-28-
(xiii) The issuance and sale of the Units by the Partnership and the
execution, delivery and performance by the Ferrellgas Parties of this
Agreement and the consummation by each of the Ferrellgas Parties of the
transactions contemplated hereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument identified in any exhibit list to the
Incorporated Documents, nor will such action result in any breach of the
provisions of the Partnership Agreement or the Operating Partnership
Agreement or of the charter or bylaws of any of the Ferrellgas Parties or,
to the knowledge of such counsel, violate any federal law of the United
States or any rules or regulations adopted by a governmental agency thereof
applicable to the Ferrellgas Parties, excluding in each case any violations
which, individually or in the aggregate, would not have a material adverse
effect upon the holders of Common Units or on the business, prospects,
financial condition or results of operations of any of the Ferrellgas
Parties, taken as a whole; provided, however, that, for the purposes of
this sub-paragraph (xiii), no opinion is expressed with respect to federal
or state securities laws, other antifraud laws and fraudulent transfer
laws;
(xiv) No consent, approval, authorization, order, registration or
qualification of or with any United States federal court or governmental
agency or body having jurisdiction over any of the Ferrellgas Parties or
any of their properties or, to the knowledge of such counsel, the Selling
Unitholders is required for the issuance and sale of the Units by the
Partnership or for the consummation by the Ferrellgas Parties or the
Selling Unitholders of the transactions contemplated by this Agreement,
except in each case for such consents, approvals, authorizations, orders,
registrations or qualifications (A) as have been obtained, (B) as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Units by the Underwriter or (C) as the
failure to obtain would not, individually or in the aggregate, have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Ferrellgas Parties, taken as a whole;
(xv) To the knowledge of such counsel, there are no legal or
governmental proceedings pending or threatened against any of the
Ferrellgas Parties or to which any property of any of them is subject that
would be required to be disclosed in the Final Prospectus and are not so
disclosed;
-29-
(xvi) Each of the Ferrellgas Parties is exempt from regulation as an
"investment company," a person "controlled by" an "investment company" or
an "affiliated person" of or "promoter" or "principal underwriter" for an
"investment company," as such terms are defined in the Investment Company
Act;
(xvii) Each of the Ferrellgas Parties is exempt from regulation as a
"holding company" or a "subsidiary company" of a "holding company" thereof
within the meaning of the Public Utility Holding Company Act of 1935, as
amended;
(xviii) The Registration Statements have been declared effective by
the Commission under the Act; and to the knowledge of such counsel no stop
order suspending the effectiveness of any of the Registration Statements
has been issued and no proceeding for that purpose has been initiated or
threatened by the Commission; and
(xix) The Registration Statements and the Final Prospectus and any
further amendments and supplements thereto made by the Partnership prior to
the time of purchase or the additional time of purchase, as the case may
be, (other than the financial statements and related schedules and other
financial data contained 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 Act.
Such counsel shall also deliver a letter to the effect that they have
participated in conferences with officers and other representatives of the
Partnership, representatives of the independent public accountants of the
Partnership and representatives and counsel of the Underwriter at which the
contents of the Registration Statements and the Final Prospectus and related
matters were discussed and based on such participation and review, although such
counsel is not passing upon and does not assume responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statements or the Final Prospectus and such counsel has made no independent
check or verification thereof (except as and to the extent stated in
sub-paragraph (xii) above), on the basis of the foregoing no facts have come to
such counsel's attention that have caused them to believe that (A) the
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Registration Statements at the time such Registration Statements became
effective and as of the time of purchase or the additional time of purchase, as
the case may be, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (B) the Final Prospectus, as of its date and
as of the time of purchase or the additional time of purchase, as the case may
be, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or (C) any amendment or supplement to the Final Prospectus, as of
its respective date, and as of the time of purchase or the additional time of
purchase, as the case may be, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading (it being understood that such counsel need
express no opinion with respect to the financial statements and schedules and
other financial data included in the Registration Statements or Final
Prospectus).
In addition, such counsel shall have furnished to you their written
opinion, dated as of the time of purchase or the additional time of purchase, as
the case may be, in form and substance satisfactory to you in your reasonable
judgment, with respect to the legal conclusions described in the Final
Prospectus under the captions "Tax Consequences" and "Tax Considerations."
In rendering such opinion, such counsel may (A) rely in respect of matters
of fact upon certificates of the Partnership and the Operating Partnership and
of officers and employees of the General Partner and Xxxxxxx and upon
information obtained from public officials, and may assume that the signatures
on all documents examined by such counsel are genuine, (B) state that their
opinion is limited to federal laws, the Delaware Act and the Delaware General
Corporation Law and (C) state that they express no opinion with respect to state
or local tax statutes to which any of the limited partners of the Partnership or
any of the Ferrellgas Parties may be subject.
(b) You shall have received from Deloitte & Touche LLP, letters dated,
respectively, the date of this Agreement and the time of purchase and additional
time of purchase, as the case may be, and addressed to the Underwriter (with
reproduced copies for the Underwriter) in the forms heretofore approved by the
Underwriter.
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(c) You shall have received at the time of purchase and at the additional
time of purchase, as the case may be, the favorable opinion of Xxxxxx & Xxxxxx
L.L.P., counsel for the Underwriter, dated the time of purchase or the
additional time of purchase, as the case may be, with respect to such matters as
may be reasonably requested by the Underwriter.
(d) All filings, if any, required by Rule 424(b) shall have been timely
made; and no stop order suspending the effectiveness of the any of the
Registration Statements shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(e) (i) None of the Ferrellgas Parties shall have sustained since the date
of the latest audited financial statements included or incorporated by reference
in the Final Prospectus 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 Final Prospectus, and (ii) since the
respective dates as of which information is given in the Final Prospectus there
shall not have been any change in the capitalization or long-term debt of the
Ferrellgas Parties, taken as a whole, or any change, or any development
involving a prospective change, in or affecting the general affairs, management,
financial position, security holders' equity or results of operations of the
Ferrellgas Parties, taken as a whole, otherwise than as set forth or
contemplated in the Final Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is in your judgment so material and adverse as
to make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Common Units being delivered at such time of purchase on the
terms and in the manner contemplated in the Final Prospectus;
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(f) On or after the date hereof (i) no downgrading shall have occurred in
the rating accorded the Partnership's or the Operating Partnership's debt
securities by any "nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule 436(g)-(2) under the
Act and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its rating of
any of the Partnership's or the Operating Partnership's debt securities;
(g) There shall have been furnished to you at such time of purchase
certificates satisfactory to you, signed on behalf of the General Partner by a
President or Vice President thereof and on behalf of the Partnership by the
General Partner by an authorized officer thereof to the effect that:
(i) In the case of the Partnership (A) the representations and
warranties of the Partnership contained in this Agreement are true and
correct at and as of such time of purchase as though made at and as of such
time of purchase; (B) the Partnership has duly performed all obligations
required to be performed by it pursuant to the terms of this Agreement at
or prior to such time of purchase; (C) no stop order suspending the
effectiveness of the any of the Registration Statements has been issued and
no proceeding for that purpose has been initiated or, to the knowledge of
the Ferrellgas Parties, threatened by the Commission, and all requests for
additional information on the part of the Commission have been complied
with or otherwise satisfied; (D) the Units have been duly listed, subject
only to official notice of issuance, on the NYSE; and (E) no event
contemplated by subsection (f) of this Section 6 in respect of the
Partnership or the Operating Partnership shall have occurred; and
(ii) In the case of the General Partner (A) the representations and
warranties of the General Partner contained in this Agreement are true and
correct at and as of such time of purchase as though made at and as of such
time of purchase; and (B) the General Partner has duly performed all
obligations required to be performed by it pursuant to the terms of this
Agreement at or prior to such time of purchase.
(h) You shall have received letters from each of the directors and officers
of the General Partner, including from each of the Selling Unitholders, and
certain of its affiliates, including Xxxxxxx and JEF Capital Management, Inc.,
to the effect that such persons shall not sell, offer or agree to sell, contract
to sell, grant any option to sell or otherwise dispose of, directly or
indirectly, any Common Units or securities convertible into or exchangeable or
exercisable for Common Units (including, but not limited to, any Senior Units)
or warrants or other rights to purchase Common Units or any other securities of
the Partnership that are substantially similar to the Common Units for a period
of 90 days after the date of the Final Prospectus without the Underwriter's
prior written consent or as otherwise set forth therein; and
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(i) The Units shall have been approved for listing on the NYSE, subject
only to official notice of issuance at or prior to the time of purchase or the
additional time of purchase, as the case may be.
7. Effective Date of Agreement; Termination. This Agreement shall become
effective when the parties hereto have executed and delivered this Agreement.
The obligations of the Underwriter hereunder shall be subject to
termination in your absolute discretion, if (x) since the time of execution of
this Agreement or the earlier respective dates as of which information is given
in the Registration Statements and the Final Prospectus, there has been any
material adverse and unfavorable change, financial or otherwise, in the
operations, business, condition or prospects of the Partnership and the
Operating Partnership taken as a whole, which would, in your judgment, make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Units on the terms or in the manner contemplated in the Registration
Statements and the Final Prospectus, or (y) since the time of execution of this
Agreement, there shall have occurred any downgrading, or any notice shall have
been given of (i) any intended or potential downgrading or (ii) any watch,
review or possible change that does not indicate an affirmation or improvement,
in the rating accorded any securities of or guaranteed by the Partnership or the
Operating Partnership by any "nationally recognized statistical rating
organization," as that term is defined in Rule 436(g)(2) under the Act or, (z)
since the time of execution of this Agreement, there shall have occurred: (i) a
suspension or material limitation in trading in securities generally on the
NYSE, the American Stock Exchange or the NASDAQ National Market; (ii) a
suspension or material limitation in trading in the Partnership's securities on
the NYSE; (iii) a general moratorium on commercial banking activities declared
by either federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the United
States; (iv) an outbreak or escalation of hostilities or acts of terrorism
involving the United States or a declaration by the United States of a national
emergency or war; or (v) any other calamity or crisis or any change in
financial, political or economic conditions in the United States or elsewhere,
if the effect of any such event specified in clause (iv) or (v) above in your
judgment make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Units on the terms and in the manner
contemplated in the Registration Statements and the Final Prospectus.
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If you elect to terminate this Agreement as provided in this Section 7, the
Partnership and each Selling Unitholder shall be notified promptly by letter or
telegram.
If the sale to the Underwriter of the Units, as contemplated by this
Agreement, is not carried out by the Underwriter for any reason permitted under
this Agreement or if such sale is not carried out because the Partnership or the
Selling Unitholders shall be unable to comply with any of the terms of this
Agreement, the Partnership or the Selling Unitholders shall not be under any
obligation or liability under this Agreement (except to the extent provided in
Sections 4(j), 5 and 8 hereof), and the Underwriter shall be under no obligation
or liability to the Partnership or the Selling Unitholders under this Agreement
(except to the extent provided in Section 8 hereof).
8. Indemnity and Contribution.
(a) The Ferrellgas Parties agree, jointly and severally, to indemnify,
defend and hold harmless the Underwriter, its partners, directors and officers,
and any person who controls the Underwriter within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, and the successors and assigns of all
of the foregoing persons from and against any loss, damage, expense, liability
or claim (including the reasonable cost of investigation) which the Underwriter
or any such person may incur under the Act, the Exchange Act, common law or
otherwise, insofar as such loss, damage, expense, liability or claim arises out
of or is based upon any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Prospectus, Reoffer Prospectus or the
Final Prospectus or in the Registration Statements or in any amendment or
supplement thereto, or arises out of or is based upon any omission or alleged
omission to state a material fact required to be stated therein or necessary to
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make the statements made therein not misleading, except insofar as any such
loss, damage, expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact contained in and
in conformity with information furnished in writing by or on behalf of the
Underwriter to the Partnership expressly for use with reference to the
Underwriter in such Registration Statement, such Preliminary Prospectus, such
Reoffer Prospectus, or such Final Prospectus or arises out of or is based upon
any omission or alleged omission to state a material fact in connection with
such information required to be stated in such Registration Statement, such
Preliminary Prospectus, such Reoffer Prospectus, or such Final Prospectus or
necessary to make such information not misleading, provided, however, that the
indemnity agreement contained in this subsection (a) with respect to the
Preliminary Prospectus (or any amendment or supplement thereto) shall not inure
to the benefit of the Underwriter (or to the benefit of any person controlling
the Underwriter) from whom the person asserting any such loss, damage, expense,
liability or claim purchased the Units that are the subject thereof if the Final
Prospectus corrected any such alleged untrue statement or omission and if the
Underwriter failed to send or give a copy of the Final Prospectus to such person
at or prior to the written confirmation of the sale of such Units to such
person, unless the failure is the result of non-compliance by the Partnership
and the General Partner with sub-paragraph (a)(ii) of Section 4 hereof.
If any action, suit or proceeding (together, a "Proceeding") is brought
against the Underwriter or any such person in respect of which indemnity may be
sought against the Ferrellgas Parties pursuant to the foregoing paragraph, the
Underwriter or such person shall promptly notify the Ferrellgas Parties in
writing of the institution of such Proceeding and the Ferrellgas Parties shall
assume the defense of such Proceeding, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees and
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expenses; provided, however, that the omission to so notify the Ferrellgas
Parties shall not relieve the Ferrellgas Parties from any liability which the
Ferrellgas Parties may have to the Underwriter or any such person or otherwise.
The Underwriter or such controlling person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of the Underwriter or of such person unless the
employment of such counsel shall have been authorized in writing by the
Ferrellgas Parties in connection with the defense of such Proceeding or the
Ferrellgas Parties shall not have, within a reasonable period of time in light
of the circumstances employed counsel to have charge of the defense of such
Proceeding or such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different from,
additional to or in conflict with those available to the Ferrellgas Parties (in
which case the Ferrellgas Parties shall not have the right to direct the defense
of such Proceeding on behalf of the indemnified party or parties but the
Ferrellgas Parties may employ counsel and participate in the defense thereof but
the fees and expenses of such counsel shall be at the expense of the Ferrellgas
Parties), in any of which events the reasonable fees and expenses shall be borne
by the Ferrellgas Parties and paid as incurred (it being understood, however,
that the Ferrellgas Parties shall not be liable for the expenses of more than
one separate counsel (in addition to any local counsel) in any one Proceeding or
series of related Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). The Ferrellgas Parties
shall not be liable for any settlement of any such Proceeding effected without
its written consent but if settled with the written consent of the Ferrellgas
Parties, the Ferrellgas Parties agree to indemnify and hold harmless the
Underwriter and any such person from and against any loss or liability by reason
of such settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
sentence of this paragraph, then the indemnifying party agrees that it shall be
liable for any settlement of any Proceeding effected without its written consent
if (i) such settlement is entered into more than 60 business days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement and (iii) such indemnified party
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shall have given the indemnifying party at least 30 days' prior notice of its
intention to settle. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened Proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such Proceeding and does not include an admission of fault, culpability or a
failure to act, by or on behalf of such indemnified party.
(b) Each of the Selling Unitholders agree to indemnify, defend and hold
harmless the Underwriter, its partners, directors and officers, and any person
who controls the Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of the
foregoing persons from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which the Underwriter or any
such person may incur under the Act, the Exchange Act, common law or otherwise,
insofar as such loss, damage, expense, liability or claim arises out of or is
based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Prospectus or the Final Prospectus or in the
Registration Statements or in any amendment or supplement thereto, or arises out
of or is based upon any omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements made therein
not misleading, provided, however that any Selling Unitholder in such capacity
will only be liable in any such case to the extent such loss, damage, expense,
liability or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact with respect to such Selling
Unitholder contained in the Final Prospectus under the heading "--Selling
Unitholders."
If any Proceeding brought against the Underwriter or any such person in
respect of which indemnity may be sought against the any of the Selling
Unitholders pursuant to the foregoing paragraph, the Underwriter or such person
shall promptly notify the relevant Selling Unitholder in writing of the
institution of such Proceeding and the relevant Selling Unitholder shall assume
the defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
provided, however, that the omission to so notify the relevant Selling
Unitholder shall not relieve the relevant Selling Unitholder from any liability
which the relevant Selling Unitholder may have to the Underwriter or any such
person or otherwise. The Underwriter or such controlling person shall have the
-38-
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of the Underwriter or of such
person unless the employment of such counsel shall have been authorized in
writing by the relevant Selling Unitholder in connection with the defense of
such Proceeding or the relevant Selling Unitholder shall not have, within a
reasonable period of time in light of the circumstances employed counsel to have
charge of the defense of such Proceeding or such indemnified party or parties
shall have reasonably concluded that there may be defenses available to it or
them which are different from, additional to or in conflict with those available
to the relevant Selling Unitholder (in which case the relevant Selling
Unitholder shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties but the relevant Selling Unitholder
may employ counsel and participate in the defense thereof but the fees and
expenses of such counsel shall be at the expense of the relevant Selling
Unitholder), in any of which events the reasonable fees and expenses shall be
borne by the relevant Selling Unitholder and paid as incurred (it being
understood, however, that the relevant Selling Unitholder shall not be liable
for the expenses of more than one separate counsel (in addition to any local
counsel) in any one Proceeding or series of related Proceedings in the same
jurisdiction representing the indemnified parties who are parties to such
Proceeding). The relevant Selling Unitholder shall not be liable for any
settlement of any such Proceeding effected without its written consent but if
settled with the written consent of the relevant Selling Unitholder, the
relevant Selling Unitholder agrees to indemnify and hold harmless the
Underwriter and any such person from and against any loss or liability by reason
of such settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
sentence of this paragraph, then the indemnifying party agrees that it shall be
liable for any settlement of any Proceeding effected without its written consent
if (i) such settlement is entered into more than 60 business days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement and (iii) such indemnified party
shall have given the indemnifying party at least 30 days' prior notice of its
intention to settle. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened Proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
-39-
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such Proceeding and does not include an admission of fault, culpability or a
failure to act, by or on behalf of such indemnified party.
(c) The Underwriter agrees to indemnify, defend and hold harmless the
Ferrellgas Parties, their partners, directors and officers and any person who
controls the Ferrellgas Parties within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act and the Selling Unitholders from and against any
loss, damage, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, the Ferrellgas Parties, the Selling
Unitholders or any such person may incur under the Act, the Exchange Act, common
law or otherwise, insofar as such loss, damage, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue statement
of a material fact contained in and in conformity with information furnished in
writing by or on behalf of the Underwriter to the Partnership expressly for use
with reference to the Underwriter in the Registration Statements, the
Preliminary Prospectus, the Reoffer Prospectus, the Final Prospectus or any
amendment or supplement thereto, or arises out of or is based upon any omission
or alleged omission to state a material fact in connection with such information
required to be stated in such Registration Statements, Preliminary Prospectus,
Reoffer Prospectus, Final Prospectus or any amendment or supplement thereto or
necessary to make such information not misleading. The Ferrellgas Parties and
the Selling Unitholders acknowledge that the statements set forth in the last
paragraph of the cover page of the Final Prospectus regarding delivery of the
Units and, under the heading "Underwriting," (i) the sentences related to
concessions and reallowances and (ii) the paragraph related to stabilization in
the Preliminary Prospectus and the Final Prospectus constitute the only
information furnished in writing by or on behalf of the Underwriter for
inclusion in the Preliminary Prospectus or the Final Prospectus.
If any Proceeding is brought against the Ferrellgas Parties, the Selling
Unitholders or any such person in respect of which indemnity may be sought
against the Underwriter pursuant to the foregoing paragraph, the Ferrellgas
Parties, the Selling Unitholders or such person shall promptly notify the
-40-
Underwriter in writing of the institution of such Proceeding and the Underwriter
shall assume the defense of such Proceeding, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees and
expenses, provided, however, that the omission to so notify the Underwriter
shall not relieve the Underwriter, from any liability which the Underwriter may
have to the Ferrellgas Parties, the Selling Unitholders or any such person or
otherwise. The Ferrellgas Parties, the Selling Unitholders or such person shall
have the right to employ its own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of the Ferrellgas Parties, the
Selling Unitholders or such person unless the employment of such counsel shall
have been authorized in writing by the Underwriter in connection with the
defense of such Proceeding or the Underwriter shall not have employed counsel to
have charge of the defense of such Proceeding or such indemnified party or
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from or additional to or in conflict with those
available to the Underwriter (in which case the Underwriter shall not have the
right to direct the defense of such Proceeding on behalf of the indemnified
party or parties, but the Underwriter may employ counsel and participate in the
defense thereof but the fees and expenses of such counsel shall be at the
expense of the Underwriter), in any of which events the reasonable fees and
expenses shall be borne by the Underwriter and paid as incurred (it being
understood, however, that the Underwriter shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). The
Underwriter shall not be liable for any settlement of any such Proceeding
effected without the written consent of the Underwriter but if settled with the
written consent of the Underwriter, the Underwriter agrees to indemnify and hold
harmless the Ferrellgas Parties, the Selling Unitholders and any such person
from and against any loss or liability by reason of such settlement.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second sentence of this
paragraph, then the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written consent if (i) such
-41-
settlement is entered into more than 60 business days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
not have reimbursed the indemnified party in accordance with such request prior
to the date of such settlement and (iii) such indemnified party shall have given
the indemnifying party at least 30 days' prior notice of its intention to
settle. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened Proceeding
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such Proceeding and does
not include an admission of fault, culpability or a failure to act, by or on
behalf of such indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable to
an indemnified party under subsections (a), (b) and (c) of this Section 8 in
respect of any losses, damages, expenses, liabilities or claims referred to
therein, then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, damages, expenses, liabilities or
claims (i) in such proportion as is appropriate to reflect the relative benefits
received by the Ferrellgas Parties, the Selling Unitholders and the Underwriter
from the offering of the Units or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law or if the indemnified party failed to
give the notice specified in clause (a), (b) or (c) above, as applicable, 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 Ferrellgas
Parties, the Selling Unitholders and the Underwriter in connection with the
statements or omissions which resulted in such losses, damages, expenses,
liabilities or claims, as well as any other relevant equitable considerations.
The relative benefits received by the Ferrellgas Parties, the Selling
Unitholders and the Underwriter shall be deemed to be in the same respective
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Ferrellgas Parties and the Selling Unitholders and the total underwriting
discounts and commissions received by the Underwriter, bear to the aggregate
public offering price of the Units. The relative fault of the Ferrellgas
-42-
Parties, the Selling Unitholders and the Underwriter shall be determined by
reference to, among other things, whether the untrue statement or alleged untrue
statement of a material fact or omission or alleged omission relates to
information supplied by the Ferrellgas Parties, Selling Unitholders or by the
Underwriter and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, damages, expenses,
liabilities and claims referred to in this subsection shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating, preparing to defend or defending any claim or
Proceeding.
(e) The Ferrellgas Parties, the Selling Unitholders and the Underwriter
agree that it would not be just and equitable if contribution pursuant to this
Section 8 were determined by pro rata allocation or by any other method of
allocation that does not take account of the equitable considerations referred
to in subsection (d) above. Notwithstanding the provisions of this Section 8,
the Underwriter shall not be required to contribute any amount in excess of the
amount by which the total price at which the Units underwritten by the
Underwriter and distributed to the public were offered to the public exceeds the
amount of any damage which the Underwriter has otherwise been required to pay by
reason of such untrue statement or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained in this Section 8
and the covenants, warranties and representations of the Ferrellgas Parties and
the Selling Unitholders contained in this Agreement shall remain in full force
and effect regardless of any investigation made by or on behalf of the
Underwriter, its directors and officers or any person (including each partner,
officer or director of such person) who controls the Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, or by or on
behalf of the Ferrellgas Parties, their directors or officers or any person who
controls the Ferrellgas Parties within the meaning of Section 15 of the Act or
-43-
Section 20 of the Exchange Act or the Selling Unitholders, and shall survive any
termination of this Agreement or the issuance and delivery of the Units. The
Ferrellgas Parties, the Selling Unitholders and the Underwriter agree promptly
to notify each other of the commencement of any Proceeding against it and, in
the case of the Ferrellgas Parties, against any of the Ferrellgas Parties'
officers or directors in connection with the issuance and sale of the Units, or
in connection with the Registration Statements, the Base Prospectus, the Reoffer
Prospectus, the Preliminary Prospectus, or the Final Prospectus.
9. Notices. Except as otherwise herein provided, all statements, requests,
notices and agreements shall be in writing or by telegram and, if to the
Underwriter, shall be sufficient in all respects if delivered or sent to UBS
Securities LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention:
Syndicate Department, and, if to the Ferrellgas Parties or the Selling
Unitholders, shall be sufficient in all respects if delivered or sent to the
Partnership at the offices of the Partnership at Xxx Xxxxxxx Xxxxx, Xxxxxxx,
Xxxxxxxx 00000, Attention: Chief Financial Officer.
10. Governing Law; Construction. This Agreement and any claim, counterclaim
or dispute of any kind or nature whatsoever arising out of or in any way
relating to this Agreement ("Claim"), directly or indirectly, shall be governed
by, and construed in accordance with, the laws of the State of New York. The
Section headings in this Agreement have been inserted as a matter of convenience
of reference and are not a part of this Agreement.
11. Entire Agreement; Amendments and Waivers. This Agreement constitutes
the entire agreement between the parties hereto pertaining to the subject matter
hereof and supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations or other agreements between the parties in
connection with the subject matter hereof except as set forth specifically
herein or contemplated hereby. No supplement, modification or waiver of this
Agreement shall be binding unless executed in writing by the party to be bound
thereby. The failure of a party to exercise any right or remedy shall not be
deemed or constitute a waiver of such right or remedy in the future. No waiver
of any of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provision hereof (regardless of whether similar), nor shall
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any such waiver constitute a continuing waiver unless otherwise expressly
provided. Each party to this Agreement agrees that (i) no other party to this
Agreement (including its agents and representatives) had made any
representation, warranty, covenant or agreement to or with such party relating
to the transactions contemplated hereby, other than those expressly set forth
herein, and (ii) such party has no relied upon any representation, warranty,
covenant or agreement relating to the transactions contemplated hereby, other
than those referred to in clause (i) above.
12. Submission to Jurisdiction. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Underwriter,
the Ferrellgas Parties and the Selling Unitholders consent to the jurisdiction
of such courts and personal service with respect thereto. The Underwriter, the
Ferrellgas Parties and the Selling Unitholders hereby consent to personal
jurisdiction, service and venue in any court in which any Claim arising out of
or in any way relating to this Agreement is brought by any third party against
the Underwriter or any indemnified party. Each of the Underwriter, the
Ferrellgas Parties and the Selling Unitholders (on their behalf and, to the
extent permitted by applicable law, on behalf of their affiliates) waive all
right to trial by jury in any action, proceeding or counterclaim (whether based
upon contract, tort or otherwise) in any way arising out of or relating to this
Agreement. The Underwriter, the Ferrellgas Parties and the Selling Unitholders
agree that a final judgment in any such action, proceeding or counterclaim
brought in any such court shall be conclusive and binding upon the Underwriter,
the Ferrellgas Parties and the Selling Unitholders and may be enforced in any
other courts in the jurisdiction of which they are or may be subject, by suit
upon such judgment.
13. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriter, the Ferrellgas Parties and the
Selling Unitholders and to the extent provided in Section 8 hereof the
controlling persons, directors and officers referred to in such Section, and
their respective successors, assigns, heirs, personal representatives and
executors and administrators. No other person, partnership, association or
corporation (including a purchaser, as such purchaser, from the Underwriter)
shall acquire or have any right under or by virtue of this Agreement.
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14. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
15. Successors and Assigns. This Agreement shall be binding upon the
Underwriter the Ferrellgas Parties and the Selling Unitholders and their
successors and assigns and any successor or assign of any substantial portion of
the Partnership's and the Underwriter's respective businesses and/or assets.
16. Miscellaneous. The Underwriter, an indirect, wholly-owned subsidiary of
UBS AG, is not a bank and is separate from any affiliated bank, including any
U.S. branch or agency of the Underwriter. Because the Underwriter is a
separately incorporated entity, it is solely responsible for its own contractual
obligations and commitments, including obligations with respect to sales and
purchases of securities. Securities sold, offered or recommended by the
Underwriter are not deposits, are not insured by the Federal Deposit Insurance
Corporation, are not guaranteed by a branch or agency, and are not otherwise an
obligation or responsibility of a branch or agency.
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If the foregoing correctly sets forth the understanding among the
Ferrellgas Parties, the Selling Unitholders and the Underwriter, please so
indicate in the space provided below for the purpose, whereupon this letter and
your acceptance shall constitute a binding agreement among the Ferrellgas
Parties, the Selling Unitholders and the Underwriter.
Very truly yours,
FERRELLGAS PARTNERS, L.P.
By: FERRELLGAS, INC.,
GENERAL PARTNER
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer and
Senior Vice President
FERRELLGAS, L.P.
By: FERRELLGAS, INC.,
ITS GENERAL PARTNER
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer and
Senior Vice President
FERRELLGAS, INC.
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer and
Senior Vice President
THE SELLING UNITHOLDERS
/s/ Xxxxx X. Xxxxx
-----------------------------------
By: Xxxxx X. Xxxxx
Individually and as Attorney-in-Fact
Accepted and agreed to as of the date first above written.
UBS SECURITIES LLC
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Executive Director
By: /s/ Xxxxxx X. Xxxx
--------------------------------
Name: Xxxxxx X. Xxxx
Title: Associate Director
SCHEDULE A
Number of
Name of Selling Unitholder Unitholder Units
-------------------------- ----------------
Xxxxxxx X. Xxxxxxxxxx....................................... 63,000
Xxxxx X. Xxxxx.............................................. 48,000
Xxxxxxx X. Xxxxx............................................ 34,400
----------------
Total........... 145,400
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