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EXHIBIT 1.1
DUKE ENERGY FIELD SERVICES, LLC
$250,000,000
6 7/8% NOTES DUE 2011
January 30, 2001
GLOBAL UNDERWRITING AGREEMENT
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
CHASE SECURITIES INC.
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Chase Securities Inc.,
000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-2014
Dear Sirs:
Duke Energy Field Services, LLC, a Delaware limited liability company
(the "Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several underwriters named in Schedule I hereto (the
"Underwriters") $250,000,000 aggregate principal amount of 6 7/8% Notes due
2011 (the "Notes"), to be issued pursuant to the provisions of an Indenture,
dated as of August 16, 2000, between the Company and The Chase Manhattan Bank,
as Trustee, as supplemented on August 16, 2000, and as to be supplemented by a
supplemental indenture, dated as of February 2, 2001, relating to the Notes (the
"Indenture").
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement (No. 333-41854) in respect of the
Notes (as amended by Amendment No. 1, filed on August 2, 2000) has been
filed on Form S-3 with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act");
such registration statement and any post-effective amendment thereto,
each in the form heretofore delivered to you, and including exhibits
thereto and all documents incorporated by reference in the prospectus
contained therein (including the Registration Statement on Form 10 (No.
0-31095) (the "Form 10"), as amended on August 2, 2000, filed under the
Securities Exchange Act of 1934, as amended (the "1934 Act")), has been
declared effective by the Commission in such form; no other document
with respect to such registration statement or any document
incorporated by reference therein has heretofore been filed with the
Commission which has not been delivered to you; no stop order
suspending the effectiveness of such registration
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statement has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission; and the Company has filed,
or proposes to file, with the Commission pursuant to Rule 424 of the
Act a prospectus supplement specifically relating to the Notes (the
various parts of the registration statement, including all exhibits
thereto and including the documents incorporated by reference in the
prospectus contained in the registration statement at the time such
part of the registration statement became effective, as amended to the
date hereof, being hereinafter called the "Registration Statement"; the
related prospectus contained in the Registration Statement, at the time
it became effective, being hereinafter called the "Basic Prospectus";
and the Basic Prospectus, as supplemented by the prospectus supplement
specifically relating to the Notes, in the form first used to confirm
sales, being hereinafter called the "Prospectus"; and any reference
herein to the Registration Statement or the Prospectus shall be deemed
to refer to and include the documents incorporated by reference
therein, as of the date of the Registration Statement or Prospectus, as
the case may be; any reference to any amendment or supplement to any
Registration Statement or Prospectus shall be deemed to refer to and
include any documents filed after the date of the Registration
Statement or Prospectus under the 1934 Act and incorporated by
reference in such Prospectus; and any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any
report of the Company filed pursuant to Section 13(a) or 15(d) of the
1934 Act after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement). If the
Company has filed an abbreviated registration statement to register
additional Notes pursuant to Rule 462(b) under the Act (the "Rule 462
Registration Statement"), then any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462
Registration Statement.
(b) No order preventing or suspending the use of the
Registration Statement or Basic Prospectus has been issued by the
Commission, and each of the Registration Statement (at the time it was
declared effective) and the Basic Prospectus (at the time of filing
thereof) conformed in all material respects to the requirements of the
Act and the respective rules and regulations of the Commission
thereunder.
(c) The Registration Statement and the Basic Prospectus
conform and the Prospectus will conform in all material respects to the
requirements of the Act and, as applicable, to the Trust Indenture Act
of 1939, and the respective rules and regulations thereunder, and the
Registration Statement and the Prospectus do not and the Prospectus
will not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, except that this
representation and warranty shall not apply to statements or omissions
made in any such document in reliance upon and in conformity with
information relating to the Underwriters furnished in writing to the
Company by an Underwriter through you expressly for use therein.
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(d) The documents incorporated by reference in the
Registration Statement or the Prospectus, at the time they were filed
with the Commission, conformed in all material respects to the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read
together with the other information in the Registration Statement and
the Prospectus, do 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 any
documents deemed to be incorporated by reference in the Prospectus
will, when they are filed with the Commission, comply in all material
respects with the requirements of the 1934 Act and the 1934 Act
Regulations, and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they are made, not misleading.
(e) This Agreement has been duly authorized, executed and
delivered by the Company. The compliance by the Company with all of the
provisions of this Agreement, the Indenture and the Notes, and the
consummation of the transactions herein and therein contemplated, will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any entity in which the Company owns
at least 50% of the capital stock or other interests or voting
securities or voting interests (each such entity, a "subsidiary") is a
party or by which the Company or any of its subsidiaries or their
respective property is bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, in each case that
is material to the Company and its subsidiaries taken as a whole; nor
will such action result in any violation of the provisions of the
Restated Certificate of Formation or the Amended and Restated Limited
Liability Company Agreement and the First Amendment, dated August 4,
2000, thereto of the Company or similar organizational documents of any
of its subsidiaries or any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Company or its subsidiaries or any of their respective properties; and
no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the consummation by the Company of the transactions
contemplated by this Agreement, the Indenture or the Notes, except the
registration under the Act of the Notes and such consents, approvals,
authorizations, registrations or qualifications as may be required
under state or foreign securities or Blue Sky laws in connection with
the purchase and distribution of the Notes by the Underwriters.
(f) The Company has been duly formed, is validly existing as a
limited liability company in good standing under the laws of the
jurisdiction of its formation, has the limited liability company power
and authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact business
and is in good standing in each jurisdiction in which
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the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(g) Each subsidiary has been duly incorporated or formed, is
validly existing as a corporation (or limited liability company, as the
case may be) in good standing under the laws of the jurisdiction of its
incorporation or formation, has the corporate (or limited liability
company) power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing or to have such power and
authority singly or in the aggregate would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole; all of
the issued shares of capital stock (or limited liability company
interests) of each wholly-owned subsidiary of the Company have been
duly and validly authorized and issued, are fully paid and
non-assessable; and the issued shares of capital stock (or limited
liability company interests) of each subsidiary of the Company that are
owned directly by the Company (or if not owned directly by the Company,
are owned by a subsidiary of the Company), are so owned free and clear
of all liens, encumbrances, equities or claims.
(h) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(i) The Company and its subsidiaries: (i) are 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 all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses; and (iii)
are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with Environmental
Laws, failure to receive required permits, licenses or other approvals
or failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(j) There are no costs or liabilities associated with
Environmental Laws (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
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potential liabilities to third parties) that would, singly or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(k) Deloitte & Touche LLP, Ernst & Young LLP and Xxxxxx
Xxxxxxxx LLP, who have certified certain financial statements of the
Company, its subsidiaries and predecessors, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
(l) The Company and its subsidiaries have good and marketable
title to all real property and beneficial or record title to or
interest in all pipeline easements, rights of way, licenses and land
use permits owned by them, except where such failure would not, singly
or in the aggregate, have a material adverse effect on the Company and
its subsidiaries taken as a whole, in each case free and clear of all
liens, encumbrances and defects except (i) such as are described in the
Prospectus and (ii) liens securing taxes and other governmental charges
or claims of materialmen, mechanics and similar persons that are not
yet due and payable and that do not materially affect the value of such
property and do not materially interfere with the use made and proposed
to be made of such property by the Company and its subsidiaries; and
any real property and buildings held under lease by the Company and its
subsidiaries are held by them under leases that are valid, existing and
in full force and effect, except as described in the Prospectus or
where the failure to be valid, existing and in full force and effect
would not have a material adverse effect on the Company and its
subsidiaries, taken a whole.
(m) Except as described in the Registration Statement or the
Prospectus, the Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or
foreign regulatory authorities necessary to conduct their respective
businesses except where such failure to possess required certificates,
authorizations and permits would not, singly or in the aggregate, have
a material adverse effect on the Company and its subsidiaries, taken as
a whole, and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit that,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a material adverse effect on the Company
and its subsidiaries, taken as a whole.
(n) There are no legal or governmental proceedings pending or
to the Company's knowledge threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of the
Company or any of its subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and are not
so described or any statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement
that are not described or filed as required.
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(o) No material labor dispute with the employees of the
Company or any of its subsidiaries exists, except as described in the
Registration Statement or the Prospectus, or, to the knowledge of the
Company, is imminent.
(p) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company (i) to file a registration statement under the Act
with respect to any securities of the Company (except for contracts,
agreements or understandings described in the Registration Statement or
the Prospectus) or (ii) to include any such securities with the Notes
registered pursuant to the Registration Statement.
(q) The statements from the Form 10 under the caption "Item 7.
Certain Relationships and Related Transactions" incorporated by
reference in the Prospectus and the statements in the Registration
Statement under the caption "Description of Debt Securities" and in the
Prospectus under the caption "Description of the Notes", in each case
insofar as such statements constitute summaries of the documents or
proceedings referred to therein, fairly present the information called
for with respect to such documents and proceedings and fairly summarize
the matters referred to therein.
(r) The Company is not a "holding company", or a
"public-utility company", or a "subsidiary company" of a "holding
company", as each such term is defined in the Public Utility Holding
Company Act of 1935, as amended.
(s) The limited liability company member interests outstanding
prior to the issuance of the Notes have been duly authorized and are
validly issued.
(t) The Indenture has been duly authorized and duly qualified
under the Trust Indenture Act of 1939 and when executed and delivered
by the Company, assuming the due authorization, execution and delivery
thereof by The Chase Manhattan Bank, as Trustee, will constitute a
valid and legally binding instrument of the Company, enforceable
against the Company in accordance with its terms, subject to the
qualifications that the enforceability of the Company's obligations
under the Indenture may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(u) The Notes have been duly authorized, and when executed by
the Company and, when authenticated by The Chase Manhattan Bank, as
Trustee, in the manner provided in the Indenture and delivered against
payment therefor, will constitute valid and legally binding obligations
of the Company, enforceable against the Company in accordance with
their terms, subject to the qualifications that the enforceability of
the Company's obligations under the Notes may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating
to or affecting creditors' rights generally, and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding
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in equity or at law), and will be entitled to the benefits afforded by
the Indenture in accordance with the terms of the Indenture and the
Notes.
2. Subject to the terms and conditions herein set forth, the Company
agrees to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company the respective principal
amount of the Notes set forth opposite the name of such Underwriter in Schedule
I hereto, plus the respective principal amount of additional Notes, which each
such Underwriter may become obligated to purchase pursuant to the provisions of
Section 9 hereof, at a purchase price of 99.143% of the principal amount of the
Notes, plus accrued interest from February 2, 2001.
3. Upon the authorization by you of the release of the Notes, the
several Underwriters propose to offer the Notes for sale upon the terms and
conditions set forth in the Prospectus.
4. The Notes, in the form of one or more global certificates and in
aggregate denominations equal to the aggregate amount of the Notes, upon
original issuance and registered in the name of Cede & Co., as nominee for The
Depository Trust Company ("DTC") or such other nominees as the Underwriters may
designate upon at least 48 hours' prior notice to the Company, shall be
delivered by or on behalf of the Company to you for the account of each
Underwriter hereunder, against payment by such Under-writer or on its behalf of
the purchase price therefor by wire transfer in immediately available funds to
an account of the Company properly identified at least 48 hours in advance, at
the office of Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or
at such other place as you and the Company may determine. The time and date of
such delivery and payment shall be 9:30 a.m., New York City time, on February 2,
2001, or such other time and date as you and the Company may agree upon in
writing (the "Closing Date").
5. The Company covenants and agrees with the several Underwriters that:
(a) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you reasonably object, and to file
with the Commission within the applicable period specified in Rule
424(b) under the Act any prospectus required to be filed pursuant to
such Rule.
(b) The Company will advise you promptly after it receives
notice thereof of the institution by the Commission of any stop order
proceedings in respect of the Registration Statement, and will use its
best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible its withdrawal, if issued.
(c) If at any time when a prospectus relating to the Notes is
required to be delivered under the Act any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material
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fact, or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend
the Prospectus to comply with the Act, the Company promptly will
prepare and, subject to Section 5(a), file with the Commission an
amendment, supplement or an appropriate document that will correct such
statement or omission or that will effect such compliance.
(d) The Company, during the period when a prospectus relating
to the Notes is required to be delivered under the Act, will timely
file all documents required to be filed with the Commission pursuant to
Section 13 or 14 of the 1934 Act.
(e) The Company will make generally available to its security
holders, in each case as soon as practicable but not later than 60 days
after the close of the period covered thereby, an earnings statement
(in form complying with the provisions of Section 11(a) of the Act,
which need not be certified by independent certified public accountants
unless required by the Act) covering (i) a 12 month period beginning
not later than the first day of the Company's fiscal quarter next
following the effective date of the Registration Statement and (ii) a
12 month period beginning not later than the first day of the Company's
fiscal quarter next following the date of this Agreement.
(f) The Company will furnish to you copies of the Registration
Statement (three of which will be signed and will include all exhibits
other than those incorporated by reference), the Prospectus, and all
amendments and supplements to such documents, in each case as soon as
available and in such quantities as you reasonably request.
(g) The Company will arrange or cooperate in arrangements for
the qualification of the Notes for sale under the laws of the United
States, each State thereof, the District of Columbia and such
jurisdictions as you reasonably designate and will continue such
qualifications in effect so long as required for the distribution;
provided, however, that the Company shall not be required to qualify as
a foreign company or to file any general consents to service of process
under the laws of any state where it is not now so subject.
(h) The Company will not, during the period of seven days from
the date hereof, sell, offer to sell, grant any option for the sale of,
or otherwise dispose of any Notes, any security convertible into or
exchangeable for the Notes or any debt security substantially similar
to the Notes (except for the Notes issued pursuant to this Agreement),
without your prior written consent.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following:
(a) The fees, disbursements and expenses of the Company's
counsel and accountants in connection with the registration of the
Notes under the Act and all
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other expenses in connection with the preparation, printing and filing
with the Commission of the Registration Statement, the Prospectus and
amendments and supplements thereto and the mailing and delivering of
copies thereof to the Underwriters and dealers.
(b) The cost of printing or producing any Agreement among
Underwriters, this Agreement, the Indenture, the Blue Sky memorandum,
closing binders and any other documents in connection with the
offering, purchase, sale and delivery of the Notes.
(c) All expenses in connection with the qualification of the
Notes for offering and sale under state securities laws as provided in
Section 5(g) hereof, including the fees and disbursements of counsel
for the Underwriters in connection with such qualification and in
connection with the Blue Sky survey.
(d) The filing fees and the reasonable fees and disbursements
of counsel to the Underwriters incident to securing any required review
by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Notes.
(e) The costs of any depository clearing and settlement
arrangements for the Notes with DTC or any successor depository.
(f) All expenses incident to the issuance and delivery of the
Notes as specified herein.
(g) Any fees charged by independent rating agencies for rating
the Notes.
(h) The costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the
marketing of the offering of the Notes, 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 with the prior approval of the
Company, travel and lodging expenses of the representatives and
officers of the Company and any such consultants, and the cost of any
aircraft chartered in connection with the road show.
(i) All other costs and expenses (other than as provided for
in Section 8) incident to the performance of the Company's obligations
hereunder that are not otherwise specifically provided for in this
Section. It is understood that, except as provided in this Section and
Sections 8 and 10 hereof, the Underwriters will pay all of their own
costs and expenses, including the fees of their counsel, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters to purchase and pay for the
Notes shall be subject, in their discretion, to the condition that all
representations and warranties of the Company herein and the statements of the
officers of the Company made pursuant to the provisions hereof are, at and as of
the Closing Date, true and correct, the condition
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that the Company shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed, if required, with
the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under
the Act; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding
for that purpose shall have been initiated or, to the knowledge of the
Company, threatened by the Commission; and all requests for additional
information on the part of the Commission shall have been complied with
to your reasonable satisfaction.
(b) Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters, shall
have furnished to you such opinion or opinions, dated the Closing Date,
generally with respect to the matters set forth in clause (c)(i),
(c)(ii), (c)(iii) and (c)(vi) and with respect to such other matters as
are reasonably requested by you, and such counsel shall have received
such papers and information as they may reasonably request to enable
them to pass upon such matters.
(c) Xxxxxx & Xxxxxx LLP, counsel for the Company, shall have
furnished to you its written opinion, dated the Closing Date, in form
and substance satisfactory to you, to the effect that:
(i) The Company is validly existing as a limited
liability company in good standing under the laws of the
jurisdiction of its formation, and has the limited liability
company power and authority to own its property and to conduct
its business as described in the Prospectus.
(ii) The Indenture has been duly authorized, executed
and delivered by the Company and duly qualified under the
Trust Indenture Act of 1939 and, assuming the due
authorization, execution and delivery thereof by The Chase
Manhattan Bank, as Trustee, constitutes a valid and legally
binding instrument of the Company, enforceable against the
Company in accordance with its terms, subject to the
qualifications that the enforceability of the Company's
obligations under the Indenture may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, and by
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
(iii) The Notes have been duly authorized and executed
by the Company and, when authenticated by The Chase Manhattan
Bank, as Trustee, in the manner provided in the Indenture and
delivered against payment therefor, will constitute valid and
legally binding obligations of the Company, enforceable
against the Company in accordance with their terms, subject to
the qualifications that the enforceability of the
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Company's obligations under the Notes may be limited by
bankruptcy, insolvency, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally, and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law), and are entitled to the benefits afforded
by the Indenture in accordance with the terms of the Indenture
and the Notes.
(iv) Each "Significant Subsidiary" of the Company (as
such term is defined in Rule 1-02 of Regulation S-X) (each a
"Significant Subsidiary" and, collectively, the "Significant
Subsidiaries") is validly existing as a corporation (or
limited liability company, as the case may be) in good
standing under the laws of the jurisdiction of its
incorporation or formation, and has the corporate (or limited
liability company) power and authority to own its property and
to conduct its business as described in the Prospectus.
(v) The Registration Statement has become effective
under the Act, and, to the knowledge of such counsel, no stop
order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
have been instituted or are pending or threatened under the
Act.
(vi) This Agreement has been duly authorized, executed
and delivered by the Company.
(vii) The performance by the Company of this
Agreement, the Indenture and the Notes, and the consummation
of the transactions herein and therein contemplated will not
contravene any of the provisions or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or any
of its subsidiaries is a party that in each case has been
filed as an exhibit to the Registration Statement or any of
the provisions of the Restated Certificate of Formation or the
Amended and Restated Limited Liability Company Agreement and
the First Amendment, dated August 4, 2000, thereto of the
Company.
(viii) The Company is not and, after giving effect to
the offering and sale of the Notes and the application of the
proceeds thereof as described in the Prospectus, will not be
required to register as an "investment company" under the
Investment Company Act of 1940, as amended.
(ix) The Company is not, and after giving effect to
the offering and sale of the Notes and the application of the
proceeds thereof as described in the Prospectus will not be,
required to register as a "holding company" under the Public
Utility Holding Company Act of 1935, as amended.
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(x) No authorization, approval, consent, order,
registration or qualification of or with any court or
governmental agency or body is legally required for the issue
and sale of the Notes or the consummation by the Company of
the transactions contemplated by this Agreement or the
Indenture, except the registration under the Act of the Notes
and the qualification of the indenture under Trust Indenture
Act of 1939, and such consents, approvals, authorizations,
orders, registrations and qualifications as may be required
under state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of the Notes by
the Underwriters.
(xi) The descriptions incorporated by reference in the
Registration Statement and Prospectus from the Form 10 of
legal or governmental proceedings under the captions "Item 1.
Business-Regulation" and "Item 1. Business-Environmental
Matters" are accurate and fairly present the information
required to be shown and such counsel does not know of any
other legal or governmental proceedings required to be
described in the Registration Statement or Prospectus that are
not described as required.
(xii) The Registration Statement as of the date of
effectiveness under the Act and the Prospectus as of the date
it was filed with, or transmitted for filing to, the
Commission (in each case, other than the financial statements
and other financial information included therein, as to which
no opinion need be rendered) appeared on their face to comply
as to form in all material respects with the requirements of
the Act and the Trust Indenture Act of 1939 and the respective
rules and regulations thereunder, and nothing has come to
their attention that would lead them to believe that the
Registration Statement as of the date of effectiveness under
the Act (or if an amendment to such Registration Statement has
been filed by the Company with the Commission subsequent to
the effectiveness of the Registration Statement, then at the
time of the most recent such filing) contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus as of
the date it was filed with, or transmitted for filing to, the
Commission and at the Closing Date contained or contains an
untrue statement of a material fact or omitted or omits 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.
(xiii) The statements made in the Registration Statement
under the caption "Description of Debt Securities" and in the
Prospectus under the caption "Description of the Notes",
insofar as they purport to constitute summaries of the terms
of the Notes, and in the Prospectus under the caption
"Underwriting" and the statements incorporated by reference in
the Registration Statement and the Prospectus from the
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Form 10 under the caption "Item 7. Certain Relationships and
Related Transactions" insofar as they purport to constitute
summaries of the legal matters and documents referred to
therein, are accurate in all material respects.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the
State of Texas, the State of New York, the General Corporation Law and
the Limited Liability Company Act of the State of Delaware and the
federal laws of the United States.
(d) Xxxxxx Xxxxxx, General Counsel to the Company, shall have
furnished to you her written opinion dated the Closing Date, in form
and substance satisfactory to you, to the effect that:
(i) Each of the Company and its subsidiaries is
validly existing as a corporation (or limited liability
company, as the case may be), is in good standing under the
laws of the jurisdiction of its incorporation or formation,
has the corporate (or limited liability company) power and
authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(ii) The performance by the Company of this Agreement,
the Indenture and the Notes, and the consummation of the
transactions herein and therein contemplated will not, to the
best knowledge of such counsel, contravene any of the
provisions or constitute a default under any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject other than such
contraventions or default as would not have a material adverse
effect on the Company and its subsidiaries taken as a whole,
nor will such action, to the best knowledge of such counsel,
contravene any of the provisions of the Certificate of
Incorporation or By-Laws or similar organizational documents
of any of its subsidiaries or to the best knowledge of such
counsel any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over
the Company or any of its properties (except that no opinion
is expressed as to federal securities laws or other anti-fraud
laws) other than such contraventions as would not have a
material adverse effect on the Company and its subsidiaries
taken as a whole or a material adverse effect on the interests
of the holders of the Notes.
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(iii) The outstanding limited liability company member
interests of the Company have been duly authorized and issued.
(iv) The descriptions in or incorporated by reference
in the Registration Statement and Prospectus of legal or
governmental proceedings are accurate and fairly present the
information required to be shown and such counsel does not
know of any litigation or any legal or governmental
proceedings instituted or threatened in writing against the
Company or any of its subsidiaries or any of their respective
properties that would be required to be described in the
Registration Statement or Prospectus and that are not
described as required.
(e) As of the date of this Agreement and also at the Closing
Date, Deloitte & Touche LLP, Xxxxx & Young LLP and Xxxxxx Xxxxxxxx LLP
shall have furnished to you a letter or letters, dated the respective
date of delivery thereof in form and substance satisfactory to you, to
the effect set forth in Annex I hereto.
(f) Since the respective dates as of which information is
given in the Prospectus and up to the Closing Date, there shall not
have been any change or any development involving a prospective change,
in the condition, financial or otherwise, or in the earnings, business
or operations of the Company and its subsidiaries, taken as a whole,
from that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement) and since
such dates and up to the Closing Date, the effect of which is, in your
judgment, so material and adverse as to make it, in your judgment,
impracticable or inadvisable to proceed with the public offering or the
delivery of the Notes at the Closing Date on the terms and in the
manner contemplated in the Prospectus.
(g) As of the Closing Date, each of Standard & Poor's Ratings
Services and Fitch IBCA, Inc. have assigned a BBB rating and Xxxxx'x
Investors Service, Inc. has assigned a Baa2 rating to the Notes.
(h) There shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded the securities
of the Company by any "nationally recognized statistical rating
organization", as such term is defined for purposes of Rule 436(g)(2)
under the Act.
(i) On or after the date hereof there shall not have
occurred any of the following: (i) a suspension or material limitation
in trading in securities generally or of the securities of the Company
on the New York Stock Exchange; (ii) a general moratorium on commercial
banking activities in New York declared by either Federal or New York
State authorities; (iii) the outbreak or material escalation of
hostilities involving the United States, or an outbreak or material
escalation of hostilities not involving the United States that could
adversely affect
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the public offering, or the declaration by the United States of a
national emergency or war; or (iv) any change in financial markets or
any calamity or crisis, if the effect of any such event specified in
these clauses (i) through (iv) in your judgment makes it impracticable
or inadvisable to proceed with the public offering or the delivery of
the Notes on the Closing Date on the terms and in the manner
contemplated in the Prospectus.
(j) The Company shall have furnished or caused to be furnished
to you at the Closing Date certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of the Closing Date, as to
the performance by the Company of all of its obligations hereunder to
be performed at or prior to the Closing Date, and as to such other
matters relating to the transactions contemplated herein as you may
reasonably request, and the Company shall have furnished or caused to
be furnished certificates as to the matters set forth in subsections
(a), (f), (g) and (h) of this Section, and as to such other matters
relating to the transactions contemplated herein as you may reasonably
request.
(k) As of the Closing Date, the Company shall have furnished
or caused to be furnished to you a certificate of the Company's
officer(s) relating to certain financial and factual data, dated the
Closing Date, in form and substance satisfactory to you.
8. (a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the 1934 Act, as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the
omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact
contained the prospectus constituting a part of the
Registration Statement in the form in which it became
effective or the Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever to the extent of the aggregate
amount paid in settlement of any litigation, commenced or
threatened, or of any claim whatsoever based upon any such
untrue statement or omission or any such alleged untrue
statement or omission, if such settlement is effected with the
written consent of the Company; and
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16
(iii) against any and all expense whatsoever
reasonably incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii)
above;
unless in each case of (i), (ii) or (iii) above such statement or omission or
such alleged statement or omission was made in reliance upon and in conformity
with the information relating to the Underwriters furnished in writing to the
Company by an Underwriter through you expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any amendment or
supplement thereto).
In no case shall the Company be liable under this indemnity agreement
with respect to any claim made against any Underwriter or any such controlling
person unless the Company shall be notified in writing of the nature of the
claim within a reasonable time after the assertion thereof, but failure so to
notify the Company shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. The Company shall be
entitled to participate at its own expense in the defense, or, if it so elects,
within a reasonable time after receipt of such notice, to assume the defense of
any suit brought to enforce any such claim, but if it so elects to assume the
defense, such defense shall be conducted by counsel chosen by it and approved by
the Underwriter or Underwriters or controlling person or persons, defendant or
defendants in any suit so brought, which approval shall not be unreasonably
withheld. In any such suit, any Underwriter or any such controlling person shall
have the right to employ its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Underwriter or such controlling person
unless (i) the Company and such Underwriter shall have mutually agreed to the
employment of such counsel or (ii) the named parties to any such action
(including any impleaded parties) include both such Underwriter or such
controlling person and the Company and such Underwriter or such controlling
person shall have been advised by such counsel that a conflict of interest
between the Company and such Underwriter or such controlling person may arise
and for this reason it is not desirable for the same counsel to represent both
the indemnifying party and also the indemnified party (it being understood,
however, that the Company shall not, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all such Underwriters and all such
controlling persons, which firm shall be designated in writing by you). The
Company agrees to notify you within a reasonable time of the assertion of any
claim against it, any of its officers or directors or any person who controls
the Company within the meaning of Section 15 of the Act or Section 20 of the
1934 Act, in connection with the sale of the Notes.
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(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, each of its directors and each of the Company's
officers who signed the Registration Statement and each person, if any,
who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the 1934 Act, to the same extent as the indemnity
contained in subsection (a) of this Section, but only with respect to
statements or omissions made in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with the information
relating to the Underwriters furnished in writing to the Company by
such Underwriter through you expressly for use in the Registration
Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto). In case any action shall be brought
against the Company or any person so indemnified based on the
Registration Statement (or any amendment thereto) or the Prospectus (or
any amendment or supplement thereto) and in respect of which indemnity
may be sought against any Underwriter, such Underwriter shall have the
rights and duties given to the Company, and the Company and each person
so indemnified shall have the rights and duties given to the
Underwriters, by the provisions of subsection (a) of this Section.
(c) 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.
(d) To the extent the indemnification provided for in Sections
8(a) or 8(b) is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to
therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities in such proportion as is
appropriate to reflect not only the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the
offering of the Notes but also the relative fault of the Company on the
one hand and of the Underwriters on the other hand in connection with
the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other hand in connection with the
offering of the Notes shall be deemed to be in the same respective
proportions as the net proceeds from the offering of the Notes (before
deducting expenses) received by the Company and the total underwriting
discounts and commissions received by the Underwriters, in each case as
set forth in the table on the cover of the Prospectus, bear to the
aggregate Public Offering Price of the Notes. The relative fault of the
Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission
-17-
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to state a material fact relates to information supplied by the Company
or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The Underwriters' respective obligations to
contribute pursuant to this Section 8 are several in proportion to the
respective principal amount of Notes they have purchased hereunder, and
not joint.
(e) The Company and the Underwriters agree that it would not
be just or equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations
referred to in Section 8(d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8, no Underwriter shall
be required to contribute any amount in excess of the amount by which
the total price at which the Notes underwritten by it and distributed
to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in
Section 8 and the representations, warranties and other statements of
the Company contained in this Agreement shall remain operative and in
full force and effect regardless of: (i) any termination of this
Agreement; (ii) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any person
controlling the Company; and (iii) acceptance of and payment for any of
the Notes.
9. This Agreement shall become effective upon the execution and
delivery hereof by the parties hereto.
(a) If any Underwriter shall default in its obligation to
purchase the principal amount of Notes that it has agreed to purchase
hereunder on the Closing Date, you may in your discretion arrange for
you or another party or other parties to purchase such principal amount
of Notes on the terms contained herein. If within thirty-six hours
after such default by any Underwriter, you notify the Company that you
have so arranged for the purchase of such principal amount of Notes,
you shall have the right to postpone the Closing Date for a period of
not more than seven days, in order to effect whatever changes may
thereby be made
-18-
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necessary in the Registration Statement or the Prospectus, or in any
other documents or arrangements, and the Company agrees to file
promptly any amendments to the Registration Statement or the Prospectus
that may be required. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement
with respect to such principal amount of Notes.
(b) If, after giving effect to any arrangements for the
purchase of the Notes of a defaulting Underwriter or Underwriters as
provided in subsection (a) above, the aggregate principal amount of
such Notes that remains unpurchased does not exceed 10% of the
aggregate principal amount of all the Notes to be purchased at the
Closing Date, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Notes
that such Underwriter agreed to purchase hereunder at the Closing Date
and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the principal amount of Notes
that such Underwriter agreed to purchase hereunder) of the principal
amount of Notes of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall
relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the principal amount of Notes of a defaulting Underwriter
or Underwriters by you as provided in subsection (a) above, the
aggregate principal amount of such Notes that remains unpurchased
exceeds 10% of the aggregate principal amount of all the Notes to be
purchased at the Closing Date, or if the Company shall not exercise the
right described in subsection (b) above to require non-defaulting
Underwriters to purchase Notes of a defaulting Underwriter or
Underwriters, then this Agreement shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters
as provided in Section 6 hereof and the indemnity agreement in Section
8 hereof; but nothing herein shall relieve a defaulting Underwriter
from liability for its default.
10. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not be under any liability to any Underwriter except as
provided in Section 6 and Section 8 hereof; but, if for any other reason any
Notes are not delivered by or on behalf of the Company as provided herein, the
Company will reimburse the Underwriters through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Notes not so delivered, but the Company shall
then be under no further liability to any Underwriter in respect of the Notes
not so delivered except as provided in Sections 6 and 8 hereof.
11. All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Underwriters shall be delivered or sent by mail or
facsimile transmission to you as the representatives in care of Chase Securities
Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000-2014, Attention: Xxxxxxx Xxxxx
(facsimile: 212-834-4533)
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(with a copy to Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, 000 Xxxxx
Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxx Xxxxxx (facsimile: 212-449-2760));
and if to the Company shall be delivered or sent by mail or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(a) hereof shall be delivered or sent by mail
or facsimile transmission to such Underwriter at its address or facsimile number
set forth in its Underwriters' Questionnaire or telex or facsimile constituting
such Questionnaire, which address or facsimile number will be supplied to the
Company by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and, to the extent provided in Section 8
hereof, the officers and directors of the Company, and each person who controls
the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Notes from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
This Agreement may be executed by any one or more of the parties hereto
in any number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.
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If the foregoing is in accordance with your understanding, please sign
and return to us eight counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement among each of the Underwriters and
the Company. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters the form of which shall be submitted to the Company
for examination, upon request, but without warranty on your part as to the
authority of the signers thereof.
Very truly yours,
DUKE ENERGY FIELD SERVICES, LLC
By: /s/ XXX X. XXXX
-------------------------------
Name: Xxx X. Xxxx
Theforegoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written.
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
CHASE SECURITIES INC.
By: XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By: /s/ XXXXXX X. XXXXX
-----------------------------------------
On behalf of each of the several Underwriters
By: CHASE SECURITIES INC.
By: /s/ XXXXX X. XXXXX
--------------------------------------------------
On behalf of each of the several Underwriters
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SCHEDULE I
$250,000,000
UNDERWRITER PRINCIPAL AMOUNT OF NOTES
----------- -------------------------
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $112,500,000
Incorporated
Chase Securities Inc. $112,500,000
Xxxxxxxx & Partners, L.P. $ 25,000,000
------------
Total $250,000,000
============
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