GULFTERRA ENERGY PARTNERS, L.P.
1,000,000 Common Units
Representing Limited Partner Interests
UNDERWRITING AGREEMENT
UNDERWRITING AGREEMENT
June 5, 2003
Xxxxxxx Xxxxxx Xxxxxx Inc.
0000 Xxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Dear Sir or Madam:
GulfTerra Energy Partners, L.P. (formerly El Paso Energy Partners,
L.P.), a Delaware limited partnership (the "Partnership"), of which GulfTerra
Energy Company, L.L.C., a Delaware limited liability company (the "General
Partner"), is the general partner, proposes to issue and sell to Xxxxxxx Xxxxxx
Xxxxxx Inc. (the "Underwriter"), an aggregate of 1,000,000 common units (the
"Firm Units") representing limited partner interests in the Partnership ("Common
Units"). In addition, solely for the purpose of covering over-allotments, the
Partnership proposes to grant to the Underwriter the option to purchase from the
Partnership up to an additional 150,000 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 Prospectus which is
referred to below.
The Partnership and the Underwriter agree as follows:
1. Sale and Purchase. Upon the basis of the representations and
warranties and subject to the terms and conditions herein set forth, the
Partnership agrees to issue and sell to the Underwriter and the Underwriter
agrees to purchase from the Partnership the Firm Units at a purchase price of
$35.2225 per Unit. The Partnership is advised by you that the Underwriter
intends (i) to make a public offering of the Firm Units as soon after the date
of this Underwriting Agreement (this "Agreement") as in your judgment is
advisable and (ii) initially to offer the Firm Units upon the terms set forth in
the 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.
In addition, the Partnership hereby grants to the Underwriter the
option to purchase, and upon the basis of the representations and warranties 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 Additional Unit to be
paid by the Underwriter to the Partnership for the Firm Units. This option may
be exercised by the Underwriter at any time and from time to time on or before
the thirtieth day following the date hereof, by written notice to the
Partnership. Such notice shall set forth the aggregate number
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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 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 Firm
Units shall be made to the Partnership by Federal Funds wire transfer, against
delivery of the certificates for the Firm Units to you through the facilities of
The Depository Trust Company ("DTC") for the account of the Underwriter. Such
payment and delivery shall be made at 9:00 A.M., Houston, Texas time, on June
10, 2003 (unless another time shall be agreed to by you and the Partnership).
The time at which such payment and delivery are to be made is hereinafter
sometimes called "the time of purchase." 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 in 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 Akin, Gump,
Strauss, Xxxxx & Xxxx, L.L.P., 000 Xxxxxxxxx Xxxxxx - Xxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx 00000, at 9:00 A.M., Houston, Texas 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. The Partnership represents and
warrants to the Underwriter as of the date hereof that:
(a) The Partnership has prepared and filed with the Securities
and Exchange Commission (the "Commission") a registration statement
(file number 333-81772) on Form S-3, including a related base
prospectus, for registration under the Securities Act of 1933, as
amended (the "Act"), of the offering and sale of the Units, and
Amendment No. 1 thereto on Form S-3 (the "Initial Registration
Statement"). At the time of the filing of Amendment No. 1 and on the
effective date of the Initial Registration Statement, the Partnership
met the requirements for use of Form S-3 under the Act. The Initial
Registration Statement and any post-effective amendment thereto, each
in the form heretofore delivered to you, have been declared effective
by the Commission in such form. Other than (i) a registration
statement, if any, increasing the size of the offering (a "Rule 462(b)
Registration Statement"), filed pursuant to Rule 462(b) under the Act,
which shall become effective upon filing, (ii) documents incorporated
by reference in the base prospectus contained in the Initial
Registration Statement, (iii) any amendment or supplement filed thereto
and any documents incorporated by reference to such amendment or
supplement, no other document with respect to the Initial Registration
Statement has heretofore been filed with the Commission. No stop order
suspending the
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effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any,
has been issued and no proceeding for that purpose has been initiated
or threatened by the Commission. The various parts of the Initial
Registration Statement and the Rule 462(b) Registration Statement, if
any, including all exhibits thereto and including (x) the information
contained in the form of a final prospectus supplement relating to this
offering to the base prospectus included in the Initial Registration
Statement, which will be filed with the Commission after the date
hereof pursuant to Rule 424(b) under the Act in accordance with Section
5(a) hereof and deemed by virtue of Rule 430A under the Act to be part
of the Initial Registration Statement and (y) the documents
incorporated by reference in such final prospectus supplement are
hereinafter collectively called the "Registration Statement." Such
final prospectus supplement, in the form first filed pursuant to Rule
424(b) under the Act, together with the base prospectus included in the
Initial Registration Statement and any subsequently filed amendments,
supplements or other documents incorporated therein, is hereinafter
called the "Prospectus." Any reference herein to the Prospectus shall
be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of
the date of such Prospectus, as the case may be. Any reference to any
amendment or supplement to the Prospectus shall be deemed to refer to
and include any documents filed after the date of such Prospectus, as
the case may be, under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and incorporated by reference in such Prospectus,
as the case may be. Any reference to any amendment or supplement to the
Registration Statement or Prospectus shall be deemed to refer to and
include the filing of any document under the Exchange Act after the
effective date of the Initial Registration Statement or the date of the
Prospectus, as the case may be, deemed to be incorporated by reference
in the Registration Statement or the Prospectus, as the case may be, as
well as the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the Act.
(b) The documents incorporated by reference in the Prospectus,
when they were filed with the Commission, conformed in all material
respects to the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Exchange
Act and the rules and regulations of the Commission thereunder and will
not contain an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided,
however, that the foregoing representations and warranties in this
Section 3(b) shall not apply to any statements or omissions made in
reliance upon and in conformity with information concerning the
Underwriter furnished in writing to the Partnership by the Underwriter
expressly for use therein.
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(c) No order preventing or suspending the use of any
Prospectus has been issued by the Commission. The Registration
Statement conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement or the Prospectus will
conform, in all material respects to the requirements of the Act and
the rules and regulations of the Commission thereunder and do not and
will not: (i) with respect to the Registration Statement, as of the
applicable effective date as to the Registration Statement and any
amendment thereto contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (ii) with
respect to the Prospectus, as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, that the foregoing representations and
warranties in this Section 3(c) shall not apply to any statements or
omissions made in reliance upon and in conformity with information
concerning the Underwriter furnished in writing to the Partnership by
the Underwriter expressly for use therein.
(d) The 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 full partnership
power and authority to own or lease, as the case may be, and to operate
its properties and conduct its business as described in the
Registration Statement and as will be described in the Prospectus, and
has been qualified or registered to do business as a foreign limited
partnership and is in good standing under the laws of each jurisdiction
that requires such qualification, other than any jurisdiction where the
failure to be so qualified would not, individually or in the aggregate,
have a material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the Partnership and its
Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business. "Subsidiary" of any
person or entity means any corporation, limited liability company,
partnership (general or limited), joint venture or other legal entity
of which such person or entity (either alone or through or together
with any other Subsidiary), owns more than 50% of the stock or other
equity interests the holder of which is generally entitled to vote for
the election of the board of directors or other governing body of such
corporation, limited liability company, partnership, joint venture or
other legal entity.
(e) The Partnership and its Subsidiaries have good and
marketable title to all property (real and personal) described the
Registration Statement and in the Prospectus as currently being owned
by each of them, free and clear of all liens, claims, security
interests or other encumbrances, except (1) such as are described or
referred to in the Registration Statement and the Prospectus, (2) such
as do not materially interfere with the ownership or benefits of
ownership of such property, and (3) Permitted Encumbrances (defined
herein). All the property described in the Registration Statement and
the Prospectus as currently being held under lease by the Partnership
or a Subsidiary is held thereby under valid, subsisting and enforceable
leases, subject to (i) applicable bankruptcy, insolvency, fraudulent
transfer and conveyance, reorganization, moratorium
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and similar laws affecting creditors' rights and remedies generally,
(ii) general principles of equity, including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity) and (iii)
securities laws and public policy underlying such laws with respect to
rights to indemnification and contribution (such exceptions described
in clauses (i), (ii) and (iii) referred to as "Enforceability
Exceptions").
(f) The General Partner has been duly organized and is validly
existing as a limited liability company in good standing under the laws
of the State of Delaware, with full limited liability company power and
authority to own or lease, as the case may be, and to operate its
properties, to conduct its business and to act as general partner of
the Partnership, as described in the Registration Statement and as will
be described in the Prospectus, and has been qualified or registered to
do business as a foreign entity and is in good standing under the laws
of each jurisdiction which requires such qualification, other than any
jurisdiction where the failure to be so qualified would not,
individually or in the aggregate: (i) have a material adverse effect on
the condition (financial or otherwise), earnings, business or
properties of the Partnership and its Subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, or (ii) subject the limited partners of the Partnership to
any material liability or disability.
(g) The General Partner is the sole general partner of the
Partnership with a 1.0% general partner interest in the Partnership.
Such general partner interest is duly authorized and validly issued to
the General Partner in accordance with the Second Amended and Restated
Agreement of Limited Partnership of the Partnership (as amended,
restated, supplemented or otherwise modified through the date hereof,
the "Partnership Agreement"), which Partnership Agreement has been duly
authorized, executed and delivered by the General Partner and is a
valid and legally binding agreement of the General Partner, enforceable
against the General Partner in accordance with its terms, subject to
the Enforceability Exceptions. The General Partner owns such general
partner interest free and clear of any lien, adverse claim, security
interest or other encumbrance, other than any lien, adverse claim,
security interest or other encumbrance created by or arising under (i)
the Delaware Act; (ii) the Sixth Amended and Restated Credit Agreement
among the Partnership, GulfTerra Energy Finance Corporation (formerly
El Paso Energy Partners Finance Corporation), the several lenders from
time to time parties thereto, and JPMorgan Chase Bank, as
Administrative Agent, dated as of March 23, 1995, as amended and
restated through November 21, 2002, and the collateral documents
related thereto, as further amended, restated, supplemented or
otherwise modified through the date hereof; (iii) the Amended and
Restated Credit Agreement among GulfTerra Holding V, L.P. (formerly EPN
Holding Company, L.P.), the lenders party thereto, Banc One Capital
Markets, Inc. and Wachovia Bank, National Association, as
Co-Syndication Agents, Fleet National Bank and Fortis Capital Corp., as
Co-Documentation Agents, and JPMorgan Chase Bank, as Administrative
Agent, dated April 8, 2002, as amended and restated through November
21, 2002, and the collateral documents related thereto, as further
amended, restated, supplemented or otherwise modified through the date
hereof; (iv) the credit agreement to which Poseidon Oil
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Pipeline Company, L.L.C., a Delaware limited liability company in which
a Subsidiary of the Partnership owns a 36% membership interest, is
party, and the collateral documents related thereto; (v) the financial
arrangements to which Sabine River Investors I, L.L.C. ("Sabine I"),
Sabine River Investors II, L.L.C. ("Xxxxxx XX"), DeepTech International
Inc. ("DeepTech"), El Paso EPN Investments, L.L.C. ("EPN Investments"),
El Paso Corporation, a Delaware corporation ("El Paso Corporation") or
GulfTerra GP Holding Company, a Delaware Corporation ("GulfTerra GP
Holding") are parties; (vi) the indenture into which the Partnership
entered on May 27, 1999, as amended, restated, supplemented or
otherwise modified through the date hereof, and (vii) the indenture
into which the Partnership entered on May 17, 2001, as amended,
restated, supplemented or otherwise modified through the date hereof,
(viii) the indenture into which the Partnership entered on November 27,
2002, as amended, restated, supplemented or otherwise modified through
the date hereof; (ix) the indenture into which the Partnership entered
on March 24, 2003, as amended, restated, supplemented or otherwise
modified through the date hereof; and (x) the credit agreement to which
Deepwater Gateway, L.L.C., a Delaware limited liability company in
which a Subsidiary of the Partnership owns a 50% membership interest,
is party ((i)-(x) the "Permitted Encumbrances"), all as disclosed in
the Registration Statement and as will be disclosed in the Prospectus.
(h) Sabine I and Xxxxxx XX own 11,674,245 Common Units,
DeepTech owns 124,324 (prior to the General Partner making the
contribution required in connection with the issuance of the Units to
maintain its 1% capital account balance) Series B preference units
representing limited partner interests in the Partnership ("Series B
Preference Units"), and EPN Investments owns 10,937,500 Series C units
representing limited partner interests in the Partnership ("Series C
Units"), all as disclosed in the Registration Statement and as will be
disclosed in the Prospectus. All of such Common Units, Series B
Preference Units and Series C Units and the limited partner interests
represented thereby have been duly authorized and validly issued and
are fully paid and nonassessable (except as such nonassessability may
be affected by the Delaware Act); and Sabine I, Xxxxxx XX, DeepTech and
EPN Investments own such limited partner interests free and clear of
any lien, adverse claim, security interest or other encumbrance, other
than Permitted Encumbrances.
(i) The Partnership's authorized and outstanding partnership
interests are as set forth in the Registration Statement and as will be
set forth in the Prospectus. The partnership interests of the
Partnership and the Partnership Agreement conform in all material
respects to the descriptions thereof contained in the Registration
Statement and as will be contained in the Prospectus. All of the
outstanding Common Units and the limited partner interests represented
thereby have been duly and validly authorized and issued, are fully
paid and nonassessable (except as such nonassessability may be affected
by the Delaware Act) and are free of any preemptive or similar rights,
except as set forth in the Partnership Agreement. The Units and the
limited partner interests represented thereby have been duly and
validly authorized and, when issued, delivered and paid for by the
Underwriter pursuant to this Agreement, will be fully paid and
nonassessable (except as such nonassessability may be affected by the
Delaware Act) and free of any preemptive
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rights or similar rights, except as set forth in the Partnership
Agreement, and the Underwriter will acquire the Units free and clear of
any lien, adverse claim, security interest, equity or other
encumbrance. No options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, partnership interests
or ownership interests in the Partnership are outstanding, other than:
(i) as set forth in the Partnership Agreement and (ii) those granted
pursuant to compensation or option plans disclosed in the Partnership's
Annual Report on Form 10-K for the year ended December 31, 2002, (the
"Existing Commitments").
(j) All of the issued and outstanding membership interests of
the General Partner have been duly and validly issued, are fully paid
and nonassessable, and are owned by GulfTerra GP Holding, free and
clear of any lien, adverse claim, security interest, equity or other
encumbrance, except for Permitted Encumbrances. GulfTerra GP Holding is
an indirect, wholly-owned Subsidiary of El Paso Corporation.
(k) The entities listed on Schedule A are the only
Subsidiaries of the Partnership. All of the outstanding shares of
capital stock, limited partner interests, general partner interests or
limited liability company interests of each of the Partnership's
Subsidiaries (other than the Chaco Liquids Plant Trust) have been duly
and validly authorized and issued and are fully paid and (except (i) as
required to the contrary by the Delaware Limited Liability Company Act
and the Delaware Act and (ii) with respect to any general partner
interests) nonassessable, and, except as otherwise set forth in
Schedule A, are owned by the Partnership, directly or indirectly
through one or more wholly-owned Subsidiaries, free and clear of any
lien, adverse claim, security interest or other encumbrance, other than
Permitted Encumbrances.
(l) The Chaco Liquids Plant Trust has been properly
constituted under the laws of the State of Massachusetts. The
Partnership is the sole beneficiary of the Chaco Liquids Plant Trust,
free and clear of any lien, adverse claim, security interest or other
encumbrance, other than Permitted Encumbrances.
(m) Each of the Partnership's Subsidiaries, other than the
Chaco Liquids Plant Trust, has been duly formed or incorporated and is
validly existing as a corporation, limited partnership, general
partnership or limited liability company in good standing (except in
the case of good standing with respect to general partnerships) under
the laws of the jurisdiction in which it is chartered or organized,
with full entity power and authority to own or lease, as the case may
be, and to operate its properties and conduct its business as set forth
in the Registration Statement and as will be described in the
Prospectus, and is duly qualified to do business as a corporation,
limited partnership, general partnership or limited liability company
and is in good standing (except in the case of good standing with
respect to general partnerships) under the laws of each jurisdiction
listed on Schedule B, which are the only jurisdictions that require
such qualification, other than any jurisdiction where the failure to be
so qualified would not, individually or in the aggregate, have a
material adverse effect on the condition (financial
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or otherwise), earnings, business or properties of the Partnership and
its Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(n) There is no material franchise, contract or other document
of a character required to be described in the Registration Statement
and as will be required to be described in the Prospectus, or to be
filed as an exhibit thereto, which is not described or filed as
required. The statements in the Registration Statement and as will be
in the Prospectus under the headings "Description of Limited Partner
Interests," "Certain Other Partnership Agreement Provisions," "Income
Tax Considerations," "Investments By Employee Benefits Plans" and
"Additional Tax Considerations" insofar as such statements summarize
legal matters, agreements, documents or proceedings discussed therein,
are accurate and fair summaries of such legal matters, agreements,
documents or proceedings.
(o) This Agreement has been duly authorized, executed and
delivered by the Partnership and constitutes a valid and binding
obligation of the Partnership enforceable against the Partnership in
accordance with its terms, subject to Enforceability Exceptions.
(p) Each of the Partnership and the General Partner is not
and, after giving effect to the offering and sale of the Units and the
application of the proceeds thereof as will be described in the
Prospectus, will not be (i) an "investment company" as defined in the
Investment Company Act of 1940, as amended or (ii) a "holding company"
within the meaning of, or subject to regulation under, the Public
Utility Holding Company Act of 1935, as amended, and the rules and
regulations promulgated by the Commission thereunder.
(q) No consent, approval, authorization, filing with or order
of any court or governmental agency or body is required in connection
with the transactions contemplated herein, except such as have been
obtained under the Act (except for the filing of the Prospectus
pursuant to Rule 424(b) promulgated under the Act) and such as may be
required by the New York Stock Exchange for listing the Units or under
the blue sky laws of any jurisdiction in connection with the purchase
and distribution of the Units by the Underwriter in the manner
contemplated herein and as will be contemplated in the Prospectus.
(r) Neither the issue and sale of the Units nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with, or result in a
breach or violation or imposition of any lien, charge or encumbrance
upon any property or assets of the Partnership or any of its
Subsidiaries or the General Partner pursuant to, (i) the partnership
agreement, limited liability company agreement, charter, by-laws or
similar organizational document of the Partnership or any of its
Subsidiaries or the General Partner, as applicable, (ii) the terms of
any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement, underwriting agreement, placement agent
agreement or other agreement, obligation, condition, covenant or
instrument to which the Partnership or any of its Subsidiaries or the
General
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Partner is a party or bound or to which its or their property is
subject, or (iii) any statute, law, rule, regulation, judgment, order
or decree applicable to the Partnership or any of its Subsidiaries or
the General Partner of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having
jurisdiction over the Partnership or any of its Subsidiaries or the
General Partner or any of its or their properties, except (x), in the
case of (ii) and (iii), where such conflict, breach, violation or
imposition would not, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Partnership and its Subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary
course of business and (y) for Section 4(o) of that certain
Underwriting Agreement dated April 8, 2003 by and among the
Partnership, El Paso Energy Partners Company and UBS Warburg LLC,
Citigroup Global Markets Inc. and RBC Xxxx Xxxxxxxx Inc., as Managing
Underwriters (the "April Underwriting Agreement").
(s) No holders of securities of the Partnership have rights to
the registration of such securities under the Registration Statement,
except for such rights (i) of the General Partner and its affiliates in
Section 6.14 of the Partnership Agreement; (ii) of Xxxxxx XX pursuant
to the Registration Rights Agreement executed in connection with the
acquisition by the Partnership of an additional interest in Viosca
Xxxxx Gathering Company; (iii) of DeepTech pursuant to the Registration
Rights Agreement executed in connection with the acquisition by the
Partnership of the Crystal storage facilities; and (iv) of El Paso
Corporation pursuant to the Registration Rights Agreement between El
Paso Corporation and the Partnership dated as of November 27, 2002,
which relates to the Series C Units. To the extent any such rights
permitted the holder thereof to participate in this offering of Units,
all such rights have been waived.
(t) The consolidated historical financial statements and
schedules of the Partnership and its consolidated subsidiaries included
in the Registration Statement and that will be included in the
Prospectus present fairly in all material respects the financial
condition, results of operations, cash flows and changes in financial
position of the Partnership and its consolidated subsidiaries as of the
dates and for the periods indicated, comply as to form with the
applicable accounting requirements of the Act and have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved (except as otherwise
noted therein).
(u) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Partnership or any of its Subsidiaries or the General Partner or its or
their respective assets or properties is pending or, to the knowledge
of the Partnership or the General Partner, threatened that (i) would
reasonably be expected to have a material adverse effect on the
performance of this Agreement or the consummation of any of the
transactions contemplated hereby or (ii) would reasonably be expected
to have a material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the Partnership and its
Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
the Registration Statement or the Prospectus.
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(v) Each of the Partnership, its Subsidiaries and the General
Partner owns or leases all such properties as are necessary to the
conduct of its operations as presently conducted, except where the lack
of such ownership or leasing would not, individually or in the
aggregate, have a material adverse effect on the condition (financial
or otherwise), earnings, business or properties of the Partnership and
its Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(w) Each of the Partnership and its Subsidiaries own, or have
obtained valid and enforceable licenses for, or other rights to use,
the inventions, patents, trademarks, tradenames, copyrights, trade
secrets and other proprietary information (collectively, "Intellectual
Property") described in the Registration Statement and the Prospectus
as being owned or licensed by them or which are necessary for the
conduct of their respective businesses, except where the failure to
own, license or have such rights would not, individually or in the
aggregate, have a material adverse effect on the condition (financial
or otherwise), earnings, business or properties of the Partnership and
its Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business. Neither the
Partnership nor any of its Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of any of the Partnership or its
Subsidiaries, and which infringement or conflict (if the subject of any
unfavorable decision, ruling or finding) or invalidity or inadequacy,
singly or in the aggregate, could reasonably be expected to result in a
material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Partnership and its
Subsidiaries, taken as a whole.
(x) None of the Partnership, any of its Subsidiaries or the
General Partner is in violation or default of (i) any provision of its
partnership agreement, limited liability company agreement, charter,
by-laws or similar organizational document, as applicable, (ii) the
terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or, to the knowledge of the General Partner
and the Partnership, any other agreement, obligation, condition,
covenant or instrument to which it is a party or bound or to which its
property is subject, or (iii) to the knowledge of the General Partner
and the Partnership, any statute, law, rule, regulation, judgment,
order or decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction
over the Partnership or such Subsidiary or the General Partner or any
of their respective properties, except, in the case of (ii) and (iii),
where such violation or default would not individually or in the
aggregate, have a material adverse effect on the condition (financial
or otherwise), earnings, business or properties of the Partnership and
its Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(y) PricewaterhouseCoopers, LLP, who have certified certain
financial statements of each of the Partnership and its consolidated
subsidiaries, Poseidon Oil Pipeline Company, L.L.C. and GulfTerra
Energy Finance Corporation in the applicable
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financial statements, and delivered their report with respect to the
audited financial statements and schedules for such entities, assets
and businesses included in or incorporated by reference into the
Prospectus, are independent public accountants as required by the Act
and the applicable published rules and regulations thereunder. Xxxxxx
Xxxxxxxx, LLP, who have previously certified certain financial
statements of Poseidon Oil Pipeline Company, L.L.C. and previously
delivered their report with respect to the audited financial statements
and schedules included in or incorporated by reference into the
Prospectus, are independent public accountants with respect to Poseidon
Oil Pipeline Company, L.L.C. as required by the Act and the applicable
rules and regulations thereunder.
(z) The Partnership and each of its Subsidiaries maintains
insurance covering its properties, operations, personnel and businesses
as the Partnership deems adequate and as previously disclosed to the
Underwriter; such insurance insures against such losses and risks to an
extent which is consistent with insurance coverage maintained by
similar companies and businesses; all such insurance is fully in force
on the date hereof and will be fully in force at the time of purchase
and any additional time of purchase.
(aa) There are no transfer taxes or other similar fees or
charges under federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance or sale of the
Units.
(bb) Each of the Partnership, its Subsidiaries and the General
Partner has filed all foreign, federal, state and local tax returns
that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not,
individually or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), earnings, business or properties of
the Partnership and its Subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business), except
as set forth in the Prospectus and has paid all taxes required to be
paid by it and any other assessment, fine or penalty levied against it,
to the extent that any of the foregoing is due and payable, except for
any such assessment, fine or penalty that is currently being contested
in good faith or as would not, individually or in the aggregate, have a
material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Partnership and its
Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
the Registration Statement and as will be set forth in the Prospectus.
(cc) No labor problem or dispute with the employees of the
Partnership or any of its Subsidiaries or the General Partner exists or
is threatened or, to the Partnership's knowledge or the General
Partner's knowledge, imminent, and neither the Partnership nor the
General Partner is aware of any existing or imminent labor disturbance
by the employees of any of its or its Subsidiaries' principal
suppliers, contractors or customers, that would, individually or in the
aggregate, have a material adverse effect on the condition (financial
or otherwise), earnings, business or properties of the Partnership and
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its Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
the Registration Statement and as will be set forth in the Prospectus.
(dd) Except as contemplated in the documents under which
Permitted Encumbrances arise, no Subsidiary of the Partnership is
currently prohibited, directly or indirectly, from paying any dividends
to the Partnership, from making any other distribution on such
Subsidiary's capital stock, limited liability company interests or
other equity interests, from repaying to the Partnership any loans or
advances to such Subsidiary from the Partnership or from transferring
any of such Subsidiary's property or assets to the Partnership or any
other Subsidiary of the Partnership, except as described in the
Registration Statement and as will be described in the Prospectus.
(ee) Each of the Partnership, its Subsidiaries and the General
Partner (i) possesses all licenses, certificates, permits and other
authorizations issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective
businesses, and (ii) has not received any notice of proceedings
relating to the revocation or modification of any such license,
certificate, authorization or permit which, in the case of (i) and (ii)
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, or otherwise, would have a material adverse effect
on the condition (financial or otherwise), earnings, business or
properties of the Partnership and its Subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in the Registration Statement and as will
be set forth in the Prospectus.
(ff) Except as otherwise set forth in the Registration
Statement and as will be set forth in the Prospectus, such as are not
material to the condition (financial or otherwise), earnings, business
or properties of the Partnership and its Subsidiaries, taken as a
whole, or as do not materially interfere with ownership or benefits of
ownership of such properties, taken as a whole, and except for
Permitted Encumbrances, the Partnership and its Subsidiaries have good
and defensible title to their interests in their oil and gas
properties.
(gg) The information that was supplied by the Partnership to
Netherland, Xxxxxx & Associates, Inc. ("Netherland & Xxxxxx"),
independent petroleum engineers, for purposes of evaluating the oil and
gas reserves of the Partnership and its subsidiaries as of December 31,
2002, including, without limitation, production, costs of operation and
development, current prices for production, agreements relating to
current and future operations and sales of production, was, to the
knowledge of the Partnership, true and correct in all material respects
on the dates such estimates were made and such information was supplied
and was prepared in accordance with customary industry practices, as
indicated in the letter of Netherland & Xxxxxx dated January 24, 2003
(the "Netherland & Xxxxxx Letter"); to the Partnership's knowledge,
Netherland & Xxxxxx was, as of the date of the Netherland & Xxxxxx
Letter, and is, as of the date hereof, independent with respect to the
Partnership and its Subsidiaries; other than normal
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production of the reserves and intervening spot market product price
fluctuations, the Partnership is not aware of any facts or
circumstances that would result in a materially adverse change in the
reserves, or the present value of future net cash flows therefrom, as
described in the Registration Statement and as will be described in the
Prospectus and as reflected in the Netherland & Xxxxxx Letter and the
reserve report referenced therein; estimates of such reserves and
present values as described in the Registration Statement and as will
be described in the Prospectus and reflected in the Netherland & Xxxxxx
Letter and the reserve report referenced therein comply in all material
respects to the applicable requirements of Regulation S-X and Industry
Guide 2 under the Act.
(hh) Any statistical and market-related data included in the
Registration Statement and the Prospectus are based on or derived from
sources that the Partnership believes to be reliable and accurate, and
the Partnership has obtained the written consent to the use of such
data from such sources to the extent required.
(ii) Each of the Partnership and its Subsidiaries maintains a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (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.
(jj) None of the Partnership, the General Partner or their
respective affiliates has taken, directly or indirectly, any action
designed to or which has constituted or which would reasonably be
expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the
Partnership to facilitate the sale or resale of the Units.
(kk) The Partnership, its Subsidiaries and the General Partner
are (i) in compliance with any and all applicable foreign, federal,
state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental
Laws"), (ii) have received and are in compliance with all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii)
have not received notice of any actual or potential liability for the
investigation or remediation of any disposal or release of hazardous or
toxic substances or wastes, pollutants or contaminants, except where
such non- compliance with Environmental Laws, failure to receive
required permits, licenses or other approvals, or liability would not,
individually or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), earnings, business or properties of
the Partnership and its Subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as
set forth in the Prospectus. Except as set forth in
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the Registration Statement and as will be set forth in the Prospectus,
to the knowledge of the Partnership, none of the Partnership, any of
its Subsidiaries or the General Partner have been named as a
"potentially responsible party" under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1989, as amended.
(ll) In the ordinary course of its business, the Partnership
periodically reviews the effect of Environmental Laws on the business,
operations and properties of the Partnership and its Subsidiaries, in
the course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws, or any permit, license or approval, any
related constraints on operating activities and any potential
liabilities to third parties). On the basis of such review, the
Partnership has reasonably concluded that such associated costs and
liabilities would not, singly or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Partnership and its Subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in the Registration Statement
and as will be set forth in the Prospectus.
(mm) Each of the Partnership, its Subsidiaries and the General
Partner has fulfilled its obligations, if any, under the minimum
funding standards of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Employee
Retirement Income Security Act of 1974 ("ERISA") and the regulations
and published interpretations thereunder with respect to each "plan"
(as defined in Section 3(3) of ERISA and such regulations and published
interpretations) in which employees of the Partnership, its
Subsidiaries and the General Partner are eligible to participate and
each such plan is in compliance in all material respects with the
presently applicable provisions of ERISA and such regulations and
published interpretations. The Partnership and its Subsidiaries and the
General Partner have not incurred any unpaid liability to the Pension
Benefit Guaranty Corporation (other than for the payment of premiums in
the ordinary course) or to any such plan under Title IV of ERISA.
(nn) The Partnership and each of its Subsidiaries has such
consents, easements, rights-of-way or licenses from any person
("rights-of-way") as are necessary to conduct its business in the
manner as will be described in the Prospectus, subject to such
qualifications as will be set forth in the Prospectus, except for such
rights-of-way which, if not obtained, would, singly or in the
aggregate, be expected not to have a have a material adverse effect on
the condition (financial or otherwise), earnings, business or
properties of the Partnership and its Subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business. The Partnership and each of its Subsidiaries has fulfilled
and performed all its material obligations with respect to such
rights-of-way and no event has occurred which allows, or after notice
or lapse of time would allow, revocation or termination thereof or
would result in any impairment of the rights of the holder of any such
rights-of-way, except for such revocations, terminations and
impairments that would not have a material adverse effect on the
condition (financial
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or otherwise), earnings, business or properties of the Partnership and
its Subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, subject in each case
to such qualifications as may be set forth in the Prospectus; and
except as will be set forth in the Prospectus, none of such
rights-of-way contains any restriction that is materially burdensome to
the Partnership and its Subsidiaries, taken as a whole.
(oo) Except as disclosed in the Registration Statement and the
Prospectus, the Partnership (i) does not have any material lending
relationship with any bank or lending affiliate of the Underwriter and
(ii) does not intend to use any of the proceeds from the sale of the
Units hereunder to repay any outstanding debt owed to any affiliate of
the Underwriter.
(pp) The Partnership has not sent or received any
communication regarding termination of, or intent not to renew, any of
the contracts or agreements referred to or described in, or filed as an
exhibit to, the Registration Statement, and no such termination or
non-renewal has been threatened by the Partnership or, to the
Partnership's knowledge, any other party to any such contract or
agreement, except where such termination or non-renewal would not,
singly or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), earnings, business or properties of
the Partnership and its Subsidiaries, taken as a whole.
(qq) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
there has not been (i) any material adverse change, or any development
involving a prospective material adverse change, in the condition
(financial or otherwise), earnings, business properties or results of
operations of the Partnership and the Subsidiaries taken as a whole,
(ii) any transaction which is material to the Partnership and the
Subsidiaries taken as a whole, (iii) any obligation, direct or
contingent (including any off-balance sheet obligations), incurred by
the Partnership or the Subsidiaries, which is material to the
Partnership and the Subsidiaries taken as a whole, or (iv) any change
in the capital stock or outstanding indebtedness of the Partnership or
the Subsidiaries.
(rr) The Partnership has provided you true, correct, and
complete copies of all documentation pertaining to any outstanding
extension of credit in the form of a personal loan made, directly or
indirectly, by the Partnership to any executive officer of the
Partnership or director of the General Partner, or to any family member
or affiliate of any executive officer of the Partnership or director of
the General Partner. Since July 30, 2002, the Partnership has not,
directly or indirectly, including through any subsidiary: (i) extended
credit, arranged to extend credit, or renewed any extension of credit,
in the form of a personal loan, to or for any executive officer of the
Partnership or director of the General Partner, or to or for any family
member or affiliate of any executive officer of the Partnership or
director of the General Partner; or (ii) made any material
modification, including any renewal thereof, to any term of any
personal loan to any executive officer of the Partnership or director
of the General Partner, or any family member or affiliate of
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any executive officer of the Partnership or director of the General
Partner, which loan was outstanding on July 30, 2002.
(ss) Neither the Partnership nor any of its Subsidiaries nor,
to the Partnership's knowledge, any employee or agent of the
Partnership or its Subsidiaries has made any payment of funds of the
Partnership or its Subsidiaries or received or retained any funds in
violation of any law, rule or regulation, which payment, receipt or
retention of funds is of a character required to be disclosed in the
Registration Statement or the Prospectus.
(tt) To the Partnership's knowledge, there are no
"affiliations" or "associations" (as defined in the NASD Conduct Rules)
between any member of the NASD and any of the Partnership's officers or
5% or greater securityholders or any of the directors of the General
Partner, except as set forth in the Registration Statement and the
Prospectus.
In addition, any certificate signed by any officer of the
Partnership and delivered to the Underwriter or counsel for the
Underwriter in connection with the offering of the Units shall be
deemed to be a representation and warranty by the Partnership as to
matters covered thereby, to the Underwriter.
4. Certain Covenants of the Partnership. The Partnership hereby agrees
with the Underwriter:
(a) 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 entity 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;
(b) to make available to the Underwriter in Houston, Texas as
soon as practicable after the date hereof, and thereafter from time to
time to furnish to the Underwriter, as many copies of the Prospectus as
the Underwriter may request for the purposes contemplated by the Act;
in case the Underwriter is required to deliver a prospectus after the
nine-month period referred to in Section 10(a)(3) of the Act in
connection with the sale of the Units, the Partnership will prepare, at
its expense, promptly upon request such amendment or amendments to the
Registration Statement and the Prospectus as may be necessary to permit
compliance with the requirements of Section 10(a)(3) of the Act;
(c) to prepare the Prospectus in a form approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business day
following the execution and delivery of this
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Agreement, or, if applicable, such earlier time as may be required by
Rule 430A(a)(3) under the Act; to make no further amendment or any
supplement (other than a Current Report on Form 8-K disclosing the
terms of this Agreement) to the Registration Statement or Prospectus
prior to the time of purchase which shall be disapproved by you
promptly after reasonable notice thereof; provided that you will not
unreasonably disapprove any such amendment or supplement;
(d) to advise you promptly, confirming such advice in writing,
of any request by the Commission so long as a Prospectus is required to
be delivered in connection with this offering for amendments or
supplements to the Registration Statement or the Prospectus or for
additional information with respect thereto, or of notice so long as a
Prospectus is required to be delivered in connection with this offering
of institution of proceedings for, or the entry of a stop order,
suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of
the Registration Statement so long as a Prospectus is required to be
delivered in connection with this offering, to use its best efforts to
obtain the lifting or removal of such order as soon as possible; to
advise you promptly of any proposal made so long as a Prospectus is
required to be delivered in connection with this offering to amend or
supplement the Registration Statement or the Prospectus, including by
filing any documents that would be incorporated therein by reference,
and to furnish you with drafts of such proposed amendment in advance of
such filing and to file no such amendment or supplement to which you
shall reasonably object in writing;
(e) subject to Section 4(d) hereof, to file promptly all
reports and any definitive proxy or information statement required to
be filed by the Partnership with the Commission to comply with the
Exchange Act subsequent to the date hereof and for so long as the
delivery of a prospectus is required in connection with the offering or
sale of the Units; to provide you with a copy of such reports and
statements and other documents to be filed by the Partnership pursuant
to Section 13, 14 or 15(d) of the Exchange Act during such period a
reasonable amount of time prior to any proposed filing, and to promptly
notify you of such filing;
(f) if necessary or appropriate, to file a registration
statement pursuant to Rule 462(b) under the Act;
(g) (i) to advise you promptly upon receipt of notice from the
Commission or any state securities regulator of any action, request,
order or proceeding that is being or will be taken or given by it with
respect to the offering of the Units, or the Prospectus and
Registration Statement in connection with the offering of the Units, or
the happening of any event that would require the making of any change
in the Prospectus in connection with the offering of the Units so that
the Prospectus would not include an untrue statement of material fact
or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under and the date on which
they are made, not misleading, (ii) to furnish you with drafts of any
proposed amendments or supplements to the Prospectus or Registration
Statement that may be necessary as a result of any such
-18-
action, request, order or proceeding or the happening of any such event
in advance of such filing and (iii) to file no such amendment or
supplement to the extent disapproved by you promptly after reasonable
notice thereof; provided that you will not unreasonably disapprove any
such amendment or supplement;
(h) to make generally available to its unitholders 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), an earnings statement of the Partnership complying with
Section 11(a) of the Act;
(i) to furnish to its unitholders as soon as practicable after
the end of each fiscal year an annual report (including a consolidated
balance sheet and statements of income, unitholders' equity and cash
flow of the Partnership and the Subsidiaries for such fiscal year,
accompanied by a copy of the certificate or report thereon of
nationally recognized independent certified public accountants);
(j) to furnish to you one signed copy of the Registration
Statement, as initially filed with the Commission, and of each
amendment thereto (including all exhibits thereto and documents
incorporated by reference therein);
(k) to furnish or otherwise make available to you promptly
upon request for a period of five years from the date of this Agreement
the following documents, provided such documents are not otherwise
publicly available via XXXXX: (i) copies of any reports or other
communications which the Partnership shall send to its unitholders or
shall from time to time publish or publicly disseminate, (ii) copies of
all annual, quarterly and current reports filed with the Commission on
Forms 10-K, 10-Q and 8-K, or such other similar forms as may be
designated by the Commission, (iii) copies of documents or reports
filed with any national securities exchange on which any class of
securities of the Partnership is listed, and (iv) such other
information as you may reasonably request regarding the Partnership,
its Subsidiaries or the General Partner;
(l) to furnish to you as early as practicable prior to the
time of purchase and any additional time of purchase, as the case may
be, but not later than two business days prior thereto, a copy of the
latest available unaudited interim consolidated financial statements,
if any, of the Partnership and the consolidated Subsidiaries which have
been read by the Partnership's independent certified public
accountants, as stated in their letter to be furnished pursuant to
Section 6(c) hereof;
(m) to apply the net proceeds from the sale of the Units in
the manner set forth under the caption "Use of Proceeds" in the
Prospectus;
(n) to pay all costs, expenses, fees and taxes (other than any
fees and disbursements of counsel for the Underwriter except as set
forth in (iii) and (iv) below and Section 5 hereof) in connection with
(i) the preparation and filing of the Registration Statement, the
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
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of mailing and shipment), (ii) the registration, issue, sale and
delivery of the Units including any transfer taxes and stamp or similar
duties payable upon the sale, issuance or delivery of the Units to the
Underwriter, (iii) the producing, word processing and/or printing of
this Agreement, any dealer agreements, any Powers of Attorney and any
closing documents (including compilations thereof) and the reproduction
and/or printing and furnishing of copies of each thereof to the
Underwriter and (except closing documents) to dealers (including costs
of mailing and shipment), (iv) the qualification of the Units for
offering and sale under state or foreign laws and the determination of
their eligibility for investment under state or foreign law as
aforesaid (including the legal fees and filing fees and other
disbursements of counsel for the Underwriter) and the printing and
furnishing of copies of any blue sky surveys or legal investment
surveys to the Underwriter and to dealers, (v) any listing of the Units
on any securities exchange, (vi) any filing for review of the public
offering of the Units by the NASD, including the legal fees and filing
fees and other disbursements of counsel to the Underwriter, (vii) the
fees and disbursements of any transfer agent or registrar for the
Units, (viii) the costs and expenses of the Partnership relating to
presentations or meetings undertaken in connection with the marketing
of the offering and sale of the Units to prospective investors and the
Underwriter's sales forces, including, without limitation, expenses
associated with the production of road show slides and graphics, fees
and expenses of any consultants engaged in connection with the road
show presentations, travel, lodging and other expenses incurred by the
officers of the Partnership and any such consultants, and the cost of
any aircraft chartered in connection with the road show, and (ix) the
performance of the Partnership's other obligations hereunder;
(o) to use its best efforts to cause the Units to be listed on
the New York Stock Exchange; and
(p) to maintain a transfer agent and, if necessary under the
jurisdiction of formation of the Partnership, a registrar for the
Units.
5. Reimbursement of Underwriter's Expenses. If the Units are not
delivered for any reason other than the default by the Underwriter in its
obligations hereunder, the Partnership shall, in addition to paying the amounts
described in Section 4(n) hereof, reimburse the Underwriter for all of its
out-of-pocket expenses, including reasonable fees and disbursements of its
counsel that shall have been incurred by it in connection with the proposed
purchase and sale of the Units.
6. Conditions of Underwriter's Obligations. The obligations of the
Underwriter hereunder are subject to the accuracy of the representations and
warranties on the part of the Partnership on the date hereof, at the time of
purchase and, if applicable, at the additional time of purchase, the performance
by the Partnership of its obligations hereunder and to the following additional
conditions precedent:
(a) The Partnership shall furnish to you at the time of
purchase and, if applicable, at the additional time of purchase, an
opinion of Akin, Gump, Strauss, Xxxxx Xxxx, L.L.P., counsel for the
Partnership, addressed to the Underwriter, and dated the time
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of purchase or the additional time of purchase, as the case may be, in
form and substance satisfactory to Xxxxxxxx & Knight LLP, counsel for
the Underwriter, stating that:
(i) each of the Partnership and its Subsidiaries
(other than the Chaco Liquids Plant Trust) has been duly
formed or incorporated and is validly existing as a
partnership, corporation or limited liability company and in
good standing (other than any general partnership) under the
laws of the jurisdiction in which it is formed, chartered or
organized, with full partnership, corporate or limited
liability company power and authority to own or lease, as the
case may be, and to operate its properties and conduct its
business as described in the Registration Statement and the
Prospectus;
(ii) each of the Partnership and its Subsidiaries
(other than those Subsidiaries that are general partnerships
and the Chaco Liquids Plant Trust) is duly qualified or
registered to do business as a foreign limited partnership,
corporation, or limited liability company, as the case may be,
and, based solely on the various certificates from public
officials of the states in which those entities are a foreign
limited partnership, corporation or limited liability company
(the "Good Standing Certificates"), is in good standing (other
than good standing with respect to general partnerships and
the Chaco Liquids Plant Trust) as a foreign limited
partnership, corporation, or limited liability company
authorized to do business in the respective jurisdictions
listed on Schedule B of this Agreement;
(iii) the General Partner is the sole general partner
of the Partnership and owns (of record) a 1.0% general partner
interest in the Partnership; such general partner interest has
been duly authorized and validly issued to the General Partner
in accordance with the Partnership Agreement, which
Partnership Agreement has been duly authorized, executed and
delivered by the General Partner and is a valid and legally
binding agreement of the General Partner, enforceable against
the General Partner in accordance with its terms, subject to
Enforceability Exceptions; to such counsel's knowledge, other
than Permitted Encumbrances, the General Partner owns such
general partner interest free and clear of any lien, adverse
claim, security interest or other encumbrance of record in
respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware or Texas naming the
General Partner as debtor is on file in the office of the
Secretary of State of the State of Delaware or Texas;
(iv) Sabine I and Xxxxxx XX own (of record) limited
partner interests in the Partnership represented by 11,674,245
Common Units, DeepTech owns 124,324 Series B Preference Units,
and EPN Investments owns 10,937,500 Series C Units; all of
such Common Units, Series B Preference Units and Series C
Units and the limited partner interests represented thereby
have been duly authorized and validly issued and are fully
paid (to the extent required by the Partnership Agreement) and
nonassessable (except as such nonassessability may be affected
by the Delaware Act). To such counsel's knowledge, other than
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Permitted Encumbrances, Sabine I, Xxxxxx XX, DeepTech and EPN
Investments own (of record) such limited partner interests
free and clear of any lien, adverse claim, security interest
or other encumbrance of record in respect of which a financing
statement under the Uniform Commercial Code of the State of
Delaware or Texas naming Sabine I, Xxxxxx XX, DeepTech and EPN
Investments as debtor is on file in the office of the
Secretary of State of the State of Delaware or Texas;
(v) all of the limited liability company interests in
the General Partner have been duly and validly authorized and
issued and are fully paid and nonassessable (except as
provided to the contrary by the Delaware Limited Liability
Company Act) and, to our knowledge, other than Permitted
Encumbrances, are owned (of record) by GulfTerra GP Holding
free and clear of any lien, adverse claim, security interest
or other encumbrance of record in respect of which a financing
statement under the Uniform Commercial Code of the State of
Delaware or Texas naming GulfTerra GP Holding as debtor is on
file in the office of the Secretary of State of the State of
Delaware or Texas; GulfTerra GP Holding is an indirect,
wholly-owned subsidiary of El Paso Corporation;
(vi) all the outstanding shares of capital stock,
limited liability company interests or other equity interests
of each Subsidiary of the Partnership (other than the Chaco
Liquids Plant Trust) have been duly and validly authorized and
issued and are (except with respect to partnership interests)
fully paid and (except (i) as provided to the contrary by the
Delaware Act or the Delaware Limited Liability Company Act and
(ii) with respect to general partnership interests)
nonassessable, and, except as otherwise set forth in the
Prospectus are owned (of record) by the Partnership directly
or indirectly through one or more Subsidiaries, and to such
counsel's knowledge, other than Permitted Encumbrances, are
owned in each such case free and clear of any security
interest, claim, lien or other encumbrance of record in
respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware or Texas naming the
Partnership, the General Partner or any of the entities listed
on Schedule B hereto as debtors is on file in the office of
the Secretary of State of the State of Delaware or Texas;
(vii) to the knowledge of such counsel, the
Partnership's authorized and outstanding partnership interests
are as set forth in the Prospectus; the partnership interests
of the Partnership and the Partnership Agreement conform in
all material respects to the descriptions thereof contained in
the Prospectus; all of the outstanding Common Units and the
limited partner interests represented thereby have been duly
and validly authorized and issued, are fully paid and
nonassessable (except as such nonassessability may be affected
by the Delaware Act) and are free of any preemptive or similar
rights, except as set forth in the Partnership Agreement; the
Units and the limited partner interests represented thereby
have been duly and validly authorized and, when issued,
delivered and paid for by the
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Underwriter pursuant to this Agreement, will be fully paid and
nonassessable (except as such nonassessability may be affected
by the Delaware Act) and free of any preemptive or similar
rights, except as set forth in the Partnership Agreement, and
the Underwriter will acquire the Units free and clear of any
lien, adverse claim, security interest or other encumbrance;
and, except as set forth in the Prospectus and the Partnership
Agreement, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert
any obligations into or exchange any securities for,
partnership interests or ownership interests in the
Partnership are outstanding, other than Existing Commitments;
(viii) the Registration Statement has become
effective under the Act; any required filing of the
Prospectus, and any supplements thereto, pursuant to Rule
424(b) has been made in the manner and within the time period
required by Rule 424(b); to the knowledge of such counsel, no
stop order suspending the effectiveness of the Registration
Statement has been issued, no proceedings for that purpose
have been instituted or threatened and the Registration
Statement and the Prospectus (other than the financial
statements and the notes thereto, oil and gas reserve
information and the schedules and other financial information
contained therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the
applicable requirements of the Act and the Exchange Act and
the respective rules thereunder;
(ix) this Agreement has been duly authorized,
executed and delivered by the Partnership;
(x) each of the Partnership and the General Partner
is not and, after giving effect to the offering and sale of
the Units and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940, as
amended;
(xi) to the knowledge of such counsel, no consent,
approval, authorization, filing with or order of any court or
governmental agency or body is required in connection with the
transactions contemplated herein, except such as have been
obtained under the Act and such as may be required by the New
York Stock Exchange relating to the listing of the Units or
under the blue sky laws of any jurisdiction in connection with
the purchase and distribution of the Units by the Underwriter
in the manner contemplated in this Agreement and in the
Prospectus and such other approvals as have been obtained;
(xii) neither the (a) issue and sale of the Units,
(b) the execution, delivery or performance of this Agreement,
or (c) compliance by the Partnership with the provisions
hereof and consummation by the Partnership of the transactions
contemplated hereby result in a breach or violation of or
imposition of any lien, charge or encumbrance upon any
property or assets of the Partnership or its Subsidiaries
pursuant to, (i) the partnership agreement, charter, by-laws
or similar organizational document of the Partnership or its
Subsidiaries, (ii) the
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terms of any agreement, contract or similar document filed as
exhibits to the Registration Statement, the Partnership's
Annual Report on Form 10-K for the year ended December 31,
2002, or the Partnership's Current Reports on Form 8-K from
January 1, 2003 through the date of the Agreement, or (iii) to
such counsel's knowledge, any statute, law, rule, regulation,
judgment, order or decree applicable to the Partnership or any
of its Subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Partnership or its
Subsidiaries or any of its or their properties, except, in the
case of (ii) or (iii), where such conflict, breach, violation
or imposition would not, individually or in the aggregate, be
likely to have, in the reasonable judgment of such counsel, a
material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the
Partnership and its Subsidiaries, taken as a whole, whether or
not arising from transactions in the ordinary course of
business, and except such counsel need express no opinion in
clause (iii) with respect to antifraud provisions of
securities laws;
(xiii) to the knowledge of such counsel, no holders
of securities of the Partnership have rights to the
registration of Common Units under the Registration Statement
except for the rights (i) of the General Partner and its
affiliates and successors in Section 6.14 of the Partnership
Agreement; (ii) of Xxxxxx XX pursuant to the Registration
Rights Agreement executed in connection with the acquisition
by the Partnership of an additional interest in Viosca Xxxxx
Gathering Company; (iii) of DeepTech pursuant to the
Registration Rights Agreement executed in connection with the
acquisition by the Partnership of the Crystal storage
facilities; and (iv) of El Paso Corporation pursuant to the
Registration Rights Agreement between El Paso Corporation and
the Partnership dated as of November 27, 2002, which rights
set forth in (xiii)(i) - (iv) have been waived to the extent
any such rights permitted the holder thereof to participate in
this offering of the Units; and
(xiv) (a) to the knowledge of such counsel, there is
no franchise, contract or other document of a character
required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required; and (b) the statements
included or incorporated by reference in the Prospectus under
the headings "Description of Limited Partner Interests",
"Certain Other Partnership Agreement Provisions" "Income Tax
Considerations," "Investment By Employee Benefit Plans" and
"Additional Tax Considerations," insofar as such statements
summarize legal matters, agreements, documents or proceedings
discussed therein, are, in all material respects, accurate and
fair summaries of such legal matters, agreements, documents or
proceedings.
Such counsel shall also state that although such counsel has not
undertaken, except as otherwise indicated in their opinion, to determine
independently, and does not assume any responsibility for, the accuracy,
completeness or fairness of the statements in the Registration Statement and the
Prospectus, such counsel has participated in the preparation of the Registration
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Statement and the Prospectus, including review and discussion of the contents
thereof, and nothing has come to the attention of such counsel that has caused
them to believe: (i) that the Registration Statement, on the effective date or
as of the time of purchase or the additional time of purchase, as the case may
be, contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, (ii) that the Prospectus, as of its date or as of the
time of purchase or the additional time of purchase, as the case may be,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading, or
(iii) that any amendment or supplement to the 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 any untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; (it being
understood that such counsel need express no opinion with respect to the
financial statements, the notes and auditors' reports thereon and the schedules
thereto, oil and gas reserve information and other financial data, in each such
case included in the Registration Statement or the Prospectus).
In rendering such opinion, such counsel may (A) rely as to matters
involving the application of laws of any jurisdiction other than the State of
Delaware or the Federal laws of the United States, to the extent they deem
proper and specified in such opinion, upon the opinion of other counsel of good
standing whom they believe to be reliable and who are satisfactory to counsel
for the Underwriter, of which a copy of any such opinion shall be delivered to
the Underwriter, (B) rely as to matters of fact, to the extent they deem proper,
on certificates of responsible officers of the Partnership and public officials,
(C) assume that the signatures on all documents examined by such counsel are
genuine, which assumptions they may state they have not independently verified,
(D) state that their opinion is limited to federal laws, the Delaware Act, the
Delaware General Corporation Law, the Delaware Limited Liability Company Act and
Texas law, (E) state that they express no opinion with respect to state or local
taxes or tax statutes to which any of the Partnership, the limited partners of
the Partnership or the General Partner may be subject and (F) state that their
opinion is furnished as counsel for the Partnership and the General Partner to
the Underwriter, and is solely for the benefit of the Underwriter. References to
the Registration Statement and the Prospectus in this paragraph (b) include any
amendments and supplements thereto at the time of purchase or the additional
time of purchase, as the case may be.
(b) The Partnership shall furnish to you at the time of
purchase and, if applicable, at the additional time of purchase, an
opinion of Xxxx X. Xxxxx, Esq., 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, in form and substance
satisfactory to Xxxxxxxx & Knight LLP, counsel for the Underwriter,
stating that:
(i) there is no pending or, to the knowledge of such
counsel, threatened action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Partnership or any of its
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Subsidiaries or the General Partner or its or their property
of a character required to be disclosed in the Prospectus that
is not adequately disclosed in the Prospectus, except those
that (a) would not be likely to have, in the reasonable
judgment of such counsel, a material adverse effect on the
performance of this Agreement or the consummation of any of
the transactions contemplated hereby or (b) would not be
likely to have, in the reasonable judgment of such counsel, a
material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the
Partnership and its Subsidiaries, taken as a whole, whether or
not arising from transactions in the ordinary course of
business, except as set forth in the Prospectus (exclusive of
any supplement thereto); and
(ii) each of the Partnership and the General Partner
is not a "holding company" and, after giving effect to the
offering and sale of the Units (as described herein) and the
application of the proceeds thereof as described in the
Prospectus, will not be a "holding company," within the
meaning of, or subject to regulation under, the Public Utility
Holding Company Act of 1935, as amended, and the rules and
regulations promulgated by the Commission thereunder.
In rendering such opinion, such counsel may (A) rely as to matters of
fact, to the extent he deems proper, on certificates of responsible officers of
the Partnership and public officials, (B) assume that the signatures on all
documents examined by such counsel are genuine, which assumptions he may state
they have not independently verified, (C) state that his opinion is limited to
federal laws, the Delaware Act, the Delaware General Corporation Law, the
Delaware LLC Act, the Delaware Revised Uniform Partnership Act and Texas law,
(D) state that he expresses no opinion with respect to state or local taxes or
tax statutes to which any of the Partnership, the limited partners of the
Partnership or the General Partner may be subject and (E) state that his opinion
is furnished as counsel for the Partnership and the General Partner to the
Underwriter, and is solely for the benefit of the Underwriter.
(c) You shall have received from PricewaterhouseCoopers a
letter dated the time of purchase and, if applicable, the additional
time of purchase, and addressed to the Underwriter in a form customary
for similar transactions.
(d) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, the favorable opinion
of Xxxxxxxx & Xxxxxx LLP, 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 you may reasonably require, and the
Partnership shall have furnished to such counsel such documents and
information as they may reasonably request for the purpose of enabling
them to pass upon such matters.
(e) No Prospectus or amendment or supplement to the
Registration Statement or the Prospectus, including documents deemed to
be incorporated by reference therein, shall have been filed to which
you object in writing.
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(f) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) under the Act at or before 5:30 P.M.,
Washington D.C. time, on the second full business day after the date of
this Agreement.
(g) Prior to the time of purchase and, if applicable, the
additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued
under the Act or proceedings initiated under Section 8(d) or 8(e) of
the Act; (ii) the Registration Statement and all amendments thereto
shall not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and (iii) the Prospectus
and all amendments or supplements thereto shall 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 are made, not
misleading.
(h) Between the time of execution of this Agreement and the
time of purchase or the additional time of purchase, as the case may
be, no material adverse change or any development involving a
prospective material adverse change (other than as disclosed in the
Registration Statement and Prospectus, exclusive of any amendments or
supplements subsequent to the date hereof) in the condition (financial
or otherwise), earnings, business, properties or results of operations
of the General Partner or the Partnership and the Subsidiaries taken as
a whole shall occur or become known.
(i) The Partnership will, at the time of purchase and, if
applicable, at the additional time of purchase, deliver to you a
certificate of the Partnership's Chief Executive Officer or Chief
Operating Officer and its Chief Financial Officer to the form attached
as Exhibit A hereto.
(j) The Partnership shall have furnished to you such other
documents and certificates as to the accuracy and completeness of any
statement in the Registration Statement and the Prospectus as of the
time of purchase and, if applicable, the additional time of purchase,
as you may reasonably request.
(k) The Units shall have been approved for listing on the New
York Stock Exchange, subject only to notice of issuance at or prior to
the time of purchase or the additional time of purchase, as the case
may be.
(l) Between the time of execution of this Agreement and the
time of purchase or the additional time of purchase, as the case may
be, there shall not have occurred any downgrading, nor shall any notice
or announcement have been given or made of (i) any intended or
potential downgrading or (ii) any review or possible change that does
not indicate an improvement, in the rating accorded any securities of
or guaranteed by the Partnership or any of its Subsidiaries by any
"nationally recognized statistical rating organization," as that term
is defined in Rule 436(g)(2) under the Act.
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(m) The Partnership shall have received the written consent of
UBS Warburg LLC (with respect to its rights under the April
Underwriting Agreement) to this offering and sale of the Units.
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 the absolute discretion of the Underwriter if (x) since the time
of execution of this Agreement or the earlier respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
been any material adverse change (other than as disclosed in the Registration
Statement and Prospectus, exclusive of any amendments or supplements subsequent
to the date hereof) or any development involving a prospective material adverse
change in the condition (financial or otherwise), earnings, business properties
or results of operations of the General Partner, the Partnership or its
Subsidiaries taken as a whole, which would, in the Underwriter's 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 Statement and the Prospectus, or (y) there shall have occurred: (i)
a suspension or material limitation in trading in securities generally on the
New York Stock Exchange, the American Stock Exchange or the NASDAQ; (ii) a
suspension or material limitation in trading in the Partnership's securities on
the New York Stock Exchange; (iii) a general moratorium on commercial banking
activities declared by either federal or New York 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; (v) any adverse change in economic
conditions or in the financial markets in the United States resulting from any
current hostilities, conflicts or wars involving the United States, including
hostilities, conflicts and wars in and around Iraq and Afghanistan, or (vi) 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), (v) or (vi) in the Underwriter's judgment makes 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
Statement and the Prospectus, or (z) there shall have occurred any downgrading,
or any notice or announcement shall have been given or made 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 General Partner, the Partnership or any of
its Subsidiary by any "nationally recognized statistical rating organization,"
as that term is defined in Rule 436(g)(2) under the Act.
If the Underwriter elects to terminate this Agreement as provided in
this Section 7, the Partnership shall be notified promptly in writing.
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 shall
be unable to comply with any of the terms of this
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Agreement, the Partnership shall not be under any obligation or liability under
this Agreement (except to the extent provided in Sections 4(n), 5 and 8 hereof),
and the Underwriter shall be under no obligation or liability to the Partnership
under this Agreement (except to the extent provided in Section 8 hereof).
8. Indemnity and Contribution.
(a) The Partnership agrees 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, jointly or severally, the Underwriter or any such
person may incur under the Act, the Exchange Act, the 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 Registration
Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Partnership) or in a Prospectus
(the term Prospectus for the purpose of this Section 8 being deemed to
include the Prospectus and the Prospectus as amended or supplemented by
the Partnership), or arises out of or is based upon any omission or
alleged omission to state a material fact required to be stated in
either such Registration Statement or such Prospectus or necessary to
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
concerning the Underwriter furnished in writing by or on behalf of the
Underwriter through you to the Partnership expressly for use in such
Registration Statement or such 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 or such Prospectus or necessary to make such
information not misleading, (ii) any untrue statement or alleged untrue
statement made by the Partnership in Section 3 hereof or the failure by
the Partnership to perform when and as required any agreement or
covenant contained herein, or (iii) any untrue statement or alleged
untrue statement of any material fact contained in any audio or visual
materials provided by the Partnership or based upon written information
furnished by or on behalf of the Partnership, including, without
limitation, slides, videos, films or tape recordings used in connection
with the marketing of the Units ("Presentation Materials"), provided
that such Presentation Materials are approved by the Partnership for
use in connection with the marketing of the Units.
If any action, suit or proceeding (each, a "Proceeding") is brought
against the Underwriter or any such person in respect of which indemnity may be
sought against the Partnership pursuant to the foregoing paragraph, the
Underwriter or such person shall promptly notify the Partnership in writing of
the institution of such Proceeding and the Partnership 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,
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that the omission to so notify the Partnership shall not relieve the Partnership
from any liability which the Partnership may have to the Underwriter or any such
person or otherwise. The Underwriter or such 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
Partnership in connection with the defense of such Proceeding or the Partnership
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 Partnership (in which case the
Partnership shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties), in any of which events such fees
and expenses shall be borne by the Partnership and paid as incurred (it being
understood, however, that the Partnership 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
Partnership shall not be liable for any settlement of any Proceeding effected
without the written consent of the Partnership, but if settled with the written
consent of the Partnership, the Partnership 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 sixty (60) business days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall not have fully 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 thirty (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) The Underwriter agrees to indemnify, defend and hold
harmless the Partnership, the General Partner, their respective
directors and officers (as applicable), and any person who controls the
Partnership or the General Partner 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, jointly or severally, the Partnership, the
General Partner or any such person may incur under the Act, the
Exchange Act, the 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 concerning
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the Underwriter furnished in writing by or on behalf of the Underwriter
to the Partnership expressly for use in the Registration Statement (or
in the Registration Statement as amended by any post-effective
amendment thereof by the Partnership) or in a 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 or such Prospectus or necessary to make
such information not misleading.
If any Proceeding is brought against the Partnership, the General
Partner or any such person in respect of which indemnity may be sought against
the Underwriter pursuant to the foregoing paragraph, the Partnership, the
General Partner or such person shall promptly notify the 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
Partnership, the General Partner or any such person or otherwise. The
Partnership, the General Partner or such person shall have the right to employ
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of the Partnership, the General Partner 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, within a reasonable period of time in light of the
circumstances, employed counsel to defend such Proceeding or such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them that 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 such 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 Partnership, the General Partner 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 sixty (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 thirty (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
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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.
(c) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under subsections (a) and (b) of
this Section 8 or insufficient to hold an indemnified party harmless in
respect of any losses, damages, expenses, liabilities or claims
referred to therein, then each applicable indemnifying 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 Partnership 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, 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 Partnership and of 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 Partnership and the Underwriter shall be deemed to be in the same
respective proportions as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses)
received by the Partnership 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 Partnership and
of 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 Partnership 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 Proceeding.
(d) The Partnership 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 (c) 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.
-32-
(e) The indemnity and contribution agreements contained in
this Section 8 and the covenants, warranties and representations of the
Partnership contained in this Agreement shall remain in full force and
effect regardless of any investigation made by or on behalf of the
Underwriter, its partners, directors or 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 Partnership,
the General Partner, its directors or officers or any person who
controls the Partnership or the General Partner within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, and shall
survive any termination of this Agreement or the issuance and delivery
of the Units. Each of the Partnership and the Underwriter agrees to
notify promptly the other of the commencement of any Proceeding against
it and, in the case of the Partnership, against any of the
Partnership's officers or directors (as applicable) in connection with
the issuance and sale of the Units, or in connection with the
Registration Statement or the Prospectus.
9. Information Furnished by the Underwriter. The statements set forth
in the last paragraph on the cover page of the Prospectus and the statements set
forth in the fifth and ninth paragraphs under the caption "Underwriting" in the
Prospectus constitute the only information furnished by or on behalf of the
Underwriter as such information is referred to in Sections 3 and 8 hereof.
10. Notices. Notice given pursuant to any of the provisions of this
Agreement shall be in writing and, unless otherwise specified, shall be mailed
or delivered (a) if to the Partnership, at the offices of the Partnership at 0
Xxxxxxxx Xxxxx, Xxxxxxxxx: Chief Financial Officer, with a copy (which shall not
constitute notice) to J. Xxxxxxx Xxxxxxxx, Xxxx Xxxx Xxxxxxx Xxxxx & Xxxx,
L.L.P., 0000 Xxxxxxxx Xxxxx, Xxxxx Tower, 000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxx
00000 or (b) if to the Underwriter, at the office of the Underwriter at 000
Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, Attention: Xxx X. Xxxxxx with a copy
(which shall not constitute notice) to Xxxx X. Xxxxx, Xxxxxxxx & Xxxxxx LLP, 000
Xxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000. Any such notice shall be
effective only upon receipt.
11. Survival. The respective representations, warranties, agreements,
covenants, indemnities and other statements of the Partnership and the
Underwriter set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall remain in full force and effect,
regardless of (i) any investigation made by or on behalf of the Partnership, the
General Partner, any of their respective officers or directors, the Underwriter
or any controlling person referred to in Section 8 hereof and (ii) delivery of
and payment for the Units.
12. 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 Texas.
The Section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
-33-
13. Waiver of Jury Trial. Each of the Underwriter and the Partnership
waives 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.
14. Counterparts. This Agreement may be signed by the parties in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
15. Entire Agreement. This Agreement, constitutes the entire
understanding between the parties hereto as to the matters covered hereby and
supersedes all prior understandings, written or oral, relating to such subject
matter.
16. Successors and Assigns. This Agreement shall inure to the benefit
of and shall be binding upon the Underwriter, the Partnership and each of their
respective successors and assigns, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained, and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person except that (i) the indemnification and
contribution contained in Section 8 of this Agreement shall also be for the
benefit of the indemnified parties, and (ii) the General Partner is entitled to
rely on the agreement of the Underwriter as set forth in Section 17 of this
Agreement. The Underwriter may not, directly or indirectly, assign, transfer or
otherwise alienate any of its rights or benefits under this Agreement to any
individual or entity without obtaining the Partnership's prior written consent,
which consent may be granted or withheld in the Partnership's sole discretion.
17. Agreement Non-Recourse to General Partner. The Underwriter agrees
that all of the obligations of the Partnership are non-recourse with respect to
the General Partner, and the Underwriter agrees that it will not seek to enforce
against or recover damages from the General Partner in connection with the
existence of this Agreement, the offering of the Units, or the Partnership's
performance or failure to perform under this Agreement.
-34-
If the foregoing correctly sets forth the understanding between the Partnership
and the Underwriter, please so indicate in the space provided below for the
purpose, whereupon this agreement and your acceptance shall constitute a binding
agreement between the Partnership and the Underwriter.
Very truly yours,
GulfTerra Energy Partners, L.P.
By: /s/ D. Xxxx Xxxxxx
----------------------------------
Name: D. Xxxx Xxxxxx
Title: Senior Vice President
Underwriting Agreement Signature Page 1
Accepted and agreed to as of the
date first above written
XXXXXXX XXXXXX XXXXXX INC.
By: /s/ Xxxxxx Xxxx
----------------------------
Name: Xxxxxx Xxxx
Title:
Underwriting Agreement Signature Page 2
SCHEDULE A
JURISDICTION OF
ENTITY NAME FORMATION OWNERSHIP
----------- --------------- ---------
Arizona Gas Storage, L.L.C. Delaware 60%
Chaco Liquids Plant Trust Massachusetts 100%
Crystal Holding, L.L.C. Delaware 100%
El Paso Energy Warwink I Company, L.P. Delaware 100%
El Paso Energy Warwink II Company, L.P. Delaware 100%
El Paso Offshore Gathering and Transmission, L.P. Delaware 100%
EPN Gathering and Treating Company, L.P. Delaware 100%
EPN Gathering and Treating GP Holding, L.L.C. Delaware 100%
First Reserve Gas, L.L.C. Delaware 100%
Flextrend Development Company, L.L.C. Delaware 100%
GulfTerra Alabama Intrastate, L.L.C. Delaware 100%
GulfTerra Arizona Gas, L.L.C. Delaware 100%
GulfTerra Energy Finance Corporation Delaware 100%
GulfTerra Field Services, L.L.C. Delaware 100%
GulfTerra GC, L.P. Delaware 100%
GulfTerra Holding I, L.L.C. Delaware 100%
GulfTerra Holding II, L.L.C. Delaware 100%
GulfTerra Holding III, L.L.C. Delaware 100%
GulfTerra Holding IV, L.P. Delaware 100%
GulfTerra Holding V, L.P. Delaware 100%
GulfTerra Intrastate, L.P. Delaware 100%
GulfTerra NGL Storage, L.L.C. Delaware 100%
GulfTerra Oil Transport, L.L.C. Delaware 100%
GulfTerra Operating Company, L.L.C. Delaware 100%
GulfTerra South Texas, L.P. Delaware 100%
GulfTerra Texas Pipeline, L.P. Delaware 100%
Hattiesburg Gas Storage Company Delaware 100%
Hattiesburg Industrial Gas Sales, L.L.C. Delaware 100%
High Island Offshore System, L.L.C. Delaware 100%
Manta Ray Gathering Company, L.L.C. Delaware 100%
Petal Gas Storage, L.L.C. Delaware 100%
Poseidon Pipeline Company, L.L.C. Delaware 100%
Warwink Gathering and Treating Company Delaware 100%
A-1
SCHEDULE B
JURISDICTION OF FOREIGN QUALIFICATION
ENTITY NAME FORMATION JURISDICTIONS
----------- --------------- ---------------------
Arizona Gas Storage, L.L.C. Delaware Arizona, Louisiana
Chaco Liquids Plant Trust Massachusetts --
Crystal Holding, L.L.C. Delaware --
El Paso Energy Warwink I Company, L.P. Delaware Texas
El Paso Energy Warwink II Company, L.P. Delaware Texas
El Paso Offshore Gathering and Transmission, L.P. Delaware Texas
EPN Gathering and Treating Company, L.P. Delaware Texas, New Mexico
EPN Gathering and Treating GP Holding, L.L.C. Delaware Texas
First Reserve Gas, L.L.C. Delaware Mississippi
Flextrend Development Company, L.L.C. Delaware Texas, Louisiana, Alabama
GulfTerra Alabama Intrastate, L.L.C. Delaware --
GulfTerra Arizona Gas, L.L.C. Delaware --
GulfTerra Energy Finance Corporation Delaware Texas
GulfTerra Field Services, L.L.C. Delaware Texas, Louisiana, New Mexico
GulfTerra GC, L.P. Delaware Texas, Louisiana, Alabama, New Mexico
GulfTerra Holding I, L.L.C. Delaware Texas
GulfTerra Holding II, L.L.C. Delaware Texas
GulfTerra Holding III, L.L.C. Delaware Texas
GulfTerra Holding IV, L.P. Delaware Texas
GulfTerra Holding V, L.P. Delaware Texas
GulfTerra Intrastate, L.P. Delaware Texas, Louisiana
GulfTerra NGL Storage, L.L.C. Delaware Mississippi, Nevada
GulfTerra Oil Transport, L.L.C. Delaware Texas, Louisiana, Alabama
GulfTerra Operating Company, L.L.C. Delaware Texas, Louisiana, Massachusetts, New Mexico
GulfTerra South Texas, L.P. Delaware Texas
GulfTerra Texas Pipeline, L.P. Delaware Texas
Hattiesburg Gas Storage Company Delaware --
Hattiesburg Industrial Gas Sales, L.L.C. Delaware Mississippi
JURISDICTION OF FOREIGN QUALIFICATION
ENTITY NAME FORMATION JURISDICTIONS
----------- --------------- ---------------------
High Island Offshore System, L.L.C. Delaware Texas, Louisiana
Manta Ray Gathering Company, L.L.C. Delaware Texas, Louisiana
Petal Gas Storage, L.L.C. Delaware Mississippi
Poseidon Pipeline Company, L.L.C. Delaware Texas
Warwink Gathering and Treating Company Delaware --
EXHIBIT A
Officers' Certificate
1. I have reviewed the Registration Statement and the Prospectus.
2. The representations and warranties of the Partnership as set forth in
this Agreement are true and correct as of the time of purchase and, if
applicable, the additional time of purchase.
3. The Partnership has performed all of its obligations under this
Agreement as are to be performed at or before the time of purchase and
at or before the additional time of purchase, as the case may be.
4. The conditions set forth in paragraphs (g) and (h) of Section 6 of this
Agreement have been met.
5. The financial statements and other financial information included in
the Registration Statement and the Prospectus fairly present in all
material respects the financial condition, results of operations, and
cash flows of the Partnership as of, and for, the periods presented in
the Registration Statement.
