ENBRIDGE ENERGY MANAGEMENT, L.L.C.
__________ SHARES
REPRESENTING LIMITED LIABILITY COMPANY INTERESTS
-----------------
UNDERWRITING AGREEMENT
----------------------
, 2002
Xxxxxxx, Xxxxx & Co.,
[NAMES OF CO-REPRESENTATIVES]
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Enbridge Energy Management, L.L.C., a Delaware limited liability
company (the "Company"), proposes, subject to the terms and conditions stated
herein, to issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of _________ shares (the "Firm Shares") and, at
the election of the Underwriters, up to ________ additional shares (the
"Optional Shares") of the Company (the Firm Shares and the Optional Shares
that the Underwriters elect to purchase pursuant to Section 2 hereof being
collectively called the "Shares").
The Company, Enbridge Energy Partners, L.P., a Delaware limited
partnership (the "Partnership"), Enbridge Energy Company, Inc., a Delaware
corporation, in its individual capacity and in its capacity as the general
partner of the Partnership (the "General Partner") are collectively referred
to herein as the "Enbridge Entities." Enbridge Inc., a corporation organized
under the laws of the province of Alberta, Canada, is herein referred to as
"Enbridge".
1A. Each of the Company, the Partnership and the General Partner,
jointly and severally, represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement (File Nos. 333-89552, 333-89588 and
333-89618) (the "Initial Registration Statement"), in respect of, in each
case as described in the Initial Registration Statement, (a) the Shares to be
issued by the Company, on Form S-1, (b) the i-units to be issued by
the Partnership, on Form S-3 and (c) the Enbridge purchase obligation in
respect of the Shares, on Form F-3, has been filed with the Securities and
Exchange Commission (the "Commission"); the Initial Registration Statement
and any post-effective amendment thereto, each in the form heretofore
delivered to you, excluding exhibits thereto but including all documents
incorporated by reference in the prospectus contained therein, 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
Securities Act of 1933, as amended (the "Act"), which became effective upon
filing, and (ii) a registration statement filed on May 24, 2002 that was
identical to the Initial Registration Statement in all material respects but
which was deleted from the Commission's XXXXX system as a result of
Commission errors that occurred in connection with the filing of such
registration statement, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed with the Commission; and no stop order suspending the
effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has been
issued and, to the knowledge of the Enbridge Entities, no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act is hereinafter called a "Preliminary Prospectus";
the Preliminary Prospectus dated ____________, 2002 is hereinafter called the
"Final Preliminary Prospectus"; the various parts of the Initial Registration
Statement and the Rule 462(b) Registration Statement, if any, including all
exhibits thereto and including (i) the information contained in the form of
final prospectus filed with the Commission 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 at the time it
was declared effective and (ii) the documents incorporated by reference in
the prospectus contained in the Initial Registration Statement at the time
such part of the Initial Registration Statement became effective, each as
amended at the time such part of the Initial Registration Statement became
effective or such part of the Rule 462(b) Registration Statement, if any,
became or hereafter becomes effective, are hereinafter collectively called
the "Registration Statement"; such final prospectus, in the form first filed
pursuant to Rule 424(b) under the Act, is hereinafter called the
"Prospectus"; any reference herein to the Final Preliminary Prospectus, any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Form S-3
and Form F-3 under the Act, as of the date of such Final Preliminary
Prospectus, Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to the Final Preliminary Prospectus,
any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include any documents filed after the date of such Final Preliminary
Prospectus, Preliminary Prospectus or Prospectus, as the case may be, under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Final Preliminary Prospectus, Preliminary
Prospectus or Prospectus, as the case may be, and any reference to any
amendment to the Registration Statement shall be deemed to refer to and
include any annual report of the Partnership or Enbridge filed pursuant to
Section 13(a) or 15(d) of the Exchange Act after the effective date of the
Initial Registration Statement that is incorporated by reference in the
Registration Statement); as used herein, the term "Incorporated Documents"
means the documents which at the time are incorporated by reference in the
Registration Statement, the Final Preliminary Prospectus, the Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto;
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(b) The Final Preliminary Prospectus included as part of the
Registration Statement complied when so filed in all material respects with
the provisions of the Act and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that this
representation and warranty does not apply to statements in or omissions from
such Final Preliminary Prospectus made in reliance upon and in conformity
with information relating to any Underwriters furnished to the Company, the
Partnership, the General Partner or Enbridge in writing by an Underwriter
through Xxxxxxx, Sachs & Co. expressly for use therein; PROVIDED, HOWEVER,
that no representation and/or warranty is hereby being made as to any of the
Enbridge Inc. Information (as hereinafter defined) contained in the Final
Preliminary Prospectus. To the best of each of the Enbridge Entities'
knowledge, information and belief, having made reasonable inquiries, the
Commission has not issued any order preventing or suspending the use of such
Final Preliminary Prospectus;
(c) The Partnership and the offering of the i-units contemplated by
this Agreement meet the requirements for using Form S-3 under the Act. The
Registration Statement in the form in which it became or becomes effective
and also in such form as it may be when any post-effective amendment thereto
shall become effective and the Final Prospectus and any supplement or
amendment thereto when filed with the Commission under Rule 424(b) and at the
Time of Delivery complied or will comply in all material respects with the
provisions of the Act, and will not at any such times contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and the statements made or to be made in such documents that are covered by
Rule 175(b) under the Act were made or will be made with a reasonable basis
and in good faith, except that this representation and warranty does not
apply to statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information relating
to any Underwriters furnished to the Company, the Partnership, the General
Partner or Enbridge in writing by an Underwriter through Xxxxxxx, Xxxxx & Co.
expressly for use therein; PROVIDED, HOWEVER, that no representation and/or
warranty is hereby being made as to any of the Enbridge Inc. Information
contained in the Registration Statement or Prospectus or the Enbridge Inc.
Part II Information contained in the Registration Statement;
(d) The Incorporated Documents, other than those filed by Enbridge,
heretofore filed, when they were filed (or, if any amendment with respect to
any such document was filed, when such amendment was filed), conformed in all
material respects with the requirements of the Exchange Act; any further
Incorporated Documents, other than those filed by Enbridge, so filed will,
when they are filed, conform in all material respects with the requirements
of the Exchange Act; no such document when it was filed (or, if an amendment
with respect to any such document was filed, when such amendment was filed),
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and no such further document, when it is
filed, will contain an untrue statement of a material fact or will omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading;
(e) The capitalization of each of the Company and the Partnership as of
the respective dates set forth in the Prospectus is as set forth under the
headings "Capitalization of Enbridge Management" and "Capitalization of
Enbridge Partners," respectively, in the Prospectus;
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(f) The Shares and i-units have been duly and validly authorized and,
when issued, delivered and paid for as provided herein (or in the case of the
i-units, as described in the Prospectus), will be validly issued, fully paid
and non-assessable (except as non-assessability may be affected by the
Delaware Revised Uniform Limited Partnership Act (the "Delaware Act") and the
Delaware Limited Liability Company Act (the "Delaware LLC Act")) and free of
any preemptive or similar rights, and will conform in all material respects
to the descriptions thereof contained in the Prospectus, and the Underwriters
will, [except as set forth in the Prospectus,] acquire the Shares free and
clear of any liens, encumbrances, security interests, charges or claims;
(g) The Partnership has been duly formed and is validly existing as a
limited partnership in good standing under the Delaware Act, with partnership
power and authority to own or lease its properties and to conduct its
business as described in the Prospectus. Each of the Current Operating
Subsidiaries has been and, at the First Time of Delivery, each of the
Post-Closing Operating Subsidiaries will be, duly organized and validly
existing as a limited liability company or limited partnership, as the case
may be, in good standing under the laws of its respective jurisdiction of
organization set forth on Schedule IIB, with full limited liability company
or partnership, as the case may be, power and authority to own or lease its
properties and to conduct its business as described in the Prospectus;
(h) The General Partner has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with the corporate power and authority to own or lease its
properties, to conduct its businesses and to act as a general partner of the
Partnership, in each case as described in the Prospectus; the General Partner
is the sole member of the Company and owns all equity securities of the
Company (other than the Shares to be issued as contemplated herein) and each
of the subsidiaries listed on Schedule IIC hereto (the "General Partner
Subsidiaries") free and clear of any lien, encumbrance, security interest,
equity or charge (except for such liens, encumbrances, security interest,
equities or charges as are not, individually or in the aggregate, material to
such interest ownership or as described in the Prospectus) and such equity
securities have been duly and validly authorized and issued and are fully
paid and (except as required to the contrary by the Delaware LLC Act),
non-assessable. The General Partner is the sole general partner of the
Partnership, and the General Partner's ownership of the Partnership is as set
forth in the Prospectus under the heading "Organizational Structure--Prior to
the Offering and Acquisition" and, following the offering, will be as set
forth in the Prospectus under the heading "Organizational
Structure--Following the Offering and Acquisition." Each of the General
Partner Subsidiaries has been duly organized and validly existing as a
limited liability company or limited partnership, as the case may be, in good
standing under the laws of its respective jurisdiction of organization set
forth on Schedule IIC, with full limited liability company or partnership, as
the case may be, power and authority to own or lease its properties and to
conduct its business as described in the Prospectus. Except as described in
the Prospectus or as set forth in the Partnership Agreement or the Delegation
of Control Agreement (as hereinafter defined), the General Partner shall
have, by the First Time of Delivery, delegated all of its power to control
and manage the business and affairs of the Partnership to the Company.
Complete and correct copies of the Certificate of Incorporation of the
General Partner, as amended, and of the By-Laws of the General Partner, as
amended, have been delivered to the Underwriters;
(i) The Company 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 its properties and to conduct its business as described in the
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Prospectus. The Company was organized for the purpose of the transactions
contemplated herein and in the Prospectus. Except as described in the
Prospectus, the Company has not engaged in any business activities other than
in connection with its organization and the transactions described therein.
Complete and correct copies of the Certificate of Formation and the Amended
and Restated Limited Liability Company Agreement of the Company have been
delivered to the Underwriters;
(j) Other than with respect to Enbridge, as to which no representation
or warranty is hereby made, the accountants, PricewaterhouseCoopers LLP, who
have certified or shall certify the financial statements included or
incorporated by reference in the Registration Statement and the Prospectus
(or any amendment or supplement thereto), are independent public accountants
as required by the Act;
(k) The historical financial statements, together with related
schedules and notes, included or incorporated by reference in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto), other than the financial statements, schedules and notes of
Enbridge incorporated by reference into the Registration Statement and
Prospectus as to which no representation or warranty is hereby made, present
fairly the respective consolidated financial position, results of operations
and changes in financial position of the Company, the Partnership and
Enbridge Midcoast Energy Inc. on the basis stated in the Registration
Statement at the respective dates or for the respective periods to which they
apply; such statements and related schedules and notes have been prepared in
accordance with generally accepted accounting principles consistently applied
throughout the periods involved, except as disclosed therein; the other
summary and selected financial and statistical information and data included
or incorporated by reference in the Registration Statement and the Prospectus
(and any amendment or supplement thereto), other than any summary and
selected financial and statistical information and data of Enbridge Inc. as
to which no representation or warranty is hereby made, are accurately
presented and prepared on a basis consistent with such financial statements
and the respective books and records of the Company, the Partnership and
Enbridge Midcoast Energy Inc., as applicable; and the pro forma financial
statements included in or incorporated by reference in the Registration
Statement and the Prospectus comply as to form in all material respects with
the applicable accounting requirements of the Act, the Exchange Act and the
rules and regulations of the Commission under such acts, except to the extent
stated therein have been prepared on a basis consistent with the historical
consolidated financial statements of the Partnership and give effect to the
assumptions used in the preparation thereof on a reasonable basis and in good
faith;
(l) Each of the Enbridge Entities has all of the necessary limited
liability company, partnership and corporate, as the case may be, power and
authority to enter into this Agreement and consummate the transactions
contemplated hereby. The execution and delivery of, and the performance by,
the Enbridge Entities of their respective obligations under this Agreement
have been duly and validly authorized, and this Agreement has been duly
executed and delivered, by each of the Enbridge Entities;
(m) Each of the Enbridge Entities has all of the necessary limited
liability company, partnership and corporate, as the case may be, power and
authority to enter into the following agreements to which it is a party: the Tax
Indemnification Agreement between the Company and Enbridge (the "Tax
Indemnification Agreement"), the Delegation of Control Agreement among the
General Partner, the Company and the Partnership (the "Delegation of Control
Agreement"), the Third Amended and Restated Agreement of Limited Partnership of
the Partnership, and the
5
Company's Amended and Restated Limited Liability Company Agreement, including
the Purchase Provisions attached thereto as Appendix A (the "Purchase
Provisions"), each to be dated as of the First Time of Delivery, and
consummate the transactions contemplated thereby. Such agreements have been
duly authorized by the respective Enbridge Entities and conform to the
descriptions thereof in the Prospectus. Each of such agreements will have
been duly executed and delivered at the First Time of Delivery and will
constitute a valid and legally binding agreement of the parties thereto,
enforceable against each of such parties in accordance with its terms,
subject, as to enforcement, (i) to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors'
rights, (ii) to general equity principles and (iii) as the rights to
indemnification or contribution thereunder may be limited by federal or state
securities laws.
(n) Neither the offer, sale or delivery of the Shares or the i-units,
the execution, delivery or performance of this Agreement, the Tax
Indemnification Agreement, the Delegation of Control Agreement, the Third
Amended and Restated Agreement of Limited Partnership, and the Company's
Amended and Restated Limited Liability Company Agreement (including the
Purchase Provisions) (all as described in the Prospectus), compliance by any
of the Enbridge Entities or the Operating Subsidiaries with the provisions
hereof or thereof nor consummation by any of the Enbridge Entities or the
Operating Subsidiaries of the transactions contemplated hereby or thereby
constitutes or, at the First Time of Delivery will constitute, as the case
may be, a breach of, or a default under, the respective partnership
agreement, limited liability company agreement, certificate or articles of
incorporation or bylaws, or other organizational documents, as the case may
be, of any of the Enbridge Entities or the Operating Subsidiaries or any
contract, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which any of the Enbridge Entities
or the Operating Subsidiaries is a party or by which any of them may be bound
or to which any of their respective properties is subject, nor will any such
action result in any violation of any existing law, regulation, ruling
(assuming compliance with all applicable federal, provincial and state
securities and Blue Sky laws), judgment, injunction, order or decree to which
any of the Enbridge Entities or the Operating Subsidiaries is a named party,
excluding in each case any breaches, defaults or violations which,
individually or in the aggregate, would not have a material adverse effect on
the financial position, results of operations, business or prospects of the
Enbridge Entities and the Operating Subsidiaries (taken as a whole), or
subject the partners of the Partnership to unlimited personal liability (a
"Material Adverse Effect"); and no consent, approval, authorization, order,
registration or qualification of or with any court or governmental agency or
body is required for the issue and sale of the Shares or the i-units or the
consummation by the Enbridge Entities of the transactions contemplated by
this Agreement or the Prospectus, except for (i) the registration under the
Act of the Shares, i-Units and purchase obligation as described in Section
1(a) herein, (ii) such consents, approvals, authorizations, registrations or
qualifications as may be required under state or provincial securities or
Blue Sky laws in connection with the purchase and distribution of the Shares
by the Underwriters and (iii) filings necessary to implement the merger,
conversion and formation of certain of the Operating Subsidiaries;
(o) Except as disclosed in the Registration Statement and the Prospectus
(or any amendment or supplement thereto), subsequent to the respective dates as
of which such information is given in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), none of the Enbridge
Entities or the Operating Subsidiaries has incurred any liability or obligation,
direct or contingent, or entered into any transaction, not in the ordinary
course of business, that is material to the limited partners of the Partnership
or the Enbridge Entities and the Operating
6
Subsidiaries (taken as a whole), and there has not been any change in the
capital stock or partner's capital, or material increase in the short-term
debt or long-term debt of, any of the Enbridge Entities, or any material
adverse change, or any development that any Enbridge Entity has reasonable
cause to believe will involve a prospective material adverse change, in the
financial position, business, prospects or results of operations of the
Enbridge Entities and the Operating Subsidiaries (taken as a whole);
(p) None of the Enbridge Entities has distributed and, prior to the
later to occur of (i) the Time of Delivery and (ii) completion of the
distribution of the Shares, will distribute any offering material in
connection with the offering and sale of the Shares other than the Prospectus
or other materials, if any, permitted by the Act;
(q) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment of supplement thereto), no more than ten percent
of the net proceeds from the sale of the Shares are intended to be or will be
paid to members of the National Association of Securities Dealers or
associated or affiliated persons of such members, or members of the immediate
family of such members;
(r) No person has any right to require registration of any membership
interests of the Company because of the filing of the Registration Statement
or consummation of the transactions contemplated by this Agreement; and
except for the General Partner, who has waived such rights, no holder of any
security of the Partnership or any other person has any right to require
registration of units representing limited partner interests in the
Partnership or any other interest or other security of the Partnership
because of the filing of the Registration Statement or consummation of the
transactions contemplated by this Agreement;
(s) None of the Enbridge Entities or Operating Subsidiaries is, or as
of the Time of Delivery will be, an "Investment Company" as that term is
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act"), or required to register as an "Investment Company" under the
Investment Company Act;
(t) None of the Enbridge Entities or Operating Subsidiaries is (i) a
"public utility company," (ii) a "holding company," (iii) a "subsidiary
company" of a "registered holding company" or of a "holding company" required
to be registered under the Public Utility Holding Company Act of 1935, as
amended (the "1935 Act"), or (iv) an "affiliate" of (A) a "registered holding
company," (B) a "holding company" required to be registered under the 1935
Act, (C) a "subsidiary company" of a "registered holding company" or (D) a
"subsidiary company" of a "holding company" required to be registered under
the 1935 Act, as such terms are defined in the 1935 Act. The issuance and
sale of the Shares as contemplated by the Prospectus is not subject to
regulation under the 1935 Act;
(u) There are no legal or governmental proceedings pending or, to the
knowledge of any of the Enbridge Entities, threatened, against any of the
Enbridge Entities or Operating Subsidiaries, or to which any of the Enbridge
Entities or Operating Subsidiaries or any of their respective properties, is
subject, that are required to be described in the Registration Statement or
the Prospectus and are not described as required;
(v) Each of the Enbridge Entities and Current Operating Subsidiaries is
and, at the First Time of Delivery, each of the Enbridge Entities and the
Post-Closing Operating Subsidiaries will be, duly qualified and in good standing
as a foreign limited partnership, limited liability company or corporation, as
the case may be, authorized to do business in each jurisdiction in which the
nature of
7
its business or its ownership or leasing of property requires such
qualification, except where the failure to be so qualified would not have a
Material Adverse Effect;
(w) Each of the Enbridge Entities owns or leases all properties as are
necessary to the conduct of their operations as described in the Prospectus,
except where the failure to own or lease any of such properties would not,
individually or in the aggregate, have a Material Adverse Effect;
(x) None of the Enbridge Entities is (a) in violation of its formation
or incorporation, as applicable, or other governing documents or (b) in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement, lease or other agreement or instrument to which it is a party
or by which it or any of its properties may be bound, except for such
violations or defaults as would not, individually or in the aggregate, have a
Material Adverse Effect;
(y) The statements set forth in the Prospectus under the captions
"Description of Our Shares", "Description of the I-Units", "Comparison of
Enbridge Partners Units with Our Shares" and "Distribution Policy," insofar
as they purport to constitute a summary of the terms of the Shares, i-units
and Common Units, are accurate and complete in all material respects;
(z) The Audit Committee of the Company's Board of Directors complies
with the applicable requirements of the Xxx Xxxx Xxxxx Xxxxxxxx;
0X. Xxxxxxxx represents and warrants to, and agrees with, each of the
Underwriters that:
(a) The Initial Registration Statement has been filed with the
Commission; the Initial Registration Statement and any post-effective
amendment thereto, each in the form heretofore delivered to you, excluding
exhibits thereto but including all documents incorporated by reference in the
prospectus contained therein, have been declared effective by the Commission
in such form; other than (i) a Rule 462(b) Registration Statement, if any,
which became effective upon filing, and (ii) registration statement filed on
May 24, 2002 that was identical to the Initial Registration Statement in all
material respects but which was deleted from the Commission's XXXXX system as
a result of Commission errors that occurred in connection with the filing of
such registration statement, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed with the Commission; and no stop order suspending the
effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has been
issued and, to the knowledge of Enbridge, no proceeding for that purpose has
been initiated or threatened by the Commission;
(b) The information under the headings "Prospectus Summary--Enbridge
Inc.," "Use of Proceeds--Enbridge Inc." and "Capitalization of Enbridge Inc."
and the information incorporated by reference into the Prospectus from the
documents listed under "Where You Can Find More Information--Enbridge Inc. SEC
Filings (File No. 0-21080)" (all of such information relating to Enbridge being
referred to herein collectively as the "Enbridge Inc. Information") contained in
such Final Preliminary Prospectus complied when so filed in all material
respects with the provisions of the Act and did not contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that this
representation and warranty does not apply to statements in or omissions from
the Final Preliminary Prospectus made in reliance upon and in conformity with
information relating to any Underwriters furnished to the Company, the
Partnership or Enbridge in writing by an Underwriter through Xxxxxxx, Xxxxx &
Co. expressly for use therein. To
8
the best of Enbridge's knowledge, information and belief, having made
reasonable inquiries, the Commission has not issued any order preventing or
suspending the use of the Preliminary Prospectus;
(c) Enbridge and the offering of the purchase obligation meet the
requirements for using Form F-3 under the Act. The Enbridge Inc. Information
contained or incorporated by reference in (i) the Registration Statement in
the form in which it became or becomes effective and also in such form as it
may be when any post-effective amendment thereto shall become effective and
(ii) the Prospectus and any supplement or amendment thereto when filed with
the Commission under Rule 424(b) and at the Time of Delivery and any
information relating to Enbridge in Part II of the Registration Statement
(including any such post-effective amendment) under headings identified as
containing information relating to Enbridge ("Enbridge Inc. Part II
Information") complied or will comply in all material respects with the
provisions of the Act, and will not at any such times contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and the statements made or to be made in such sections of such documents that
are covered by Rule 175(b) under the Act were made or will be made with a
reasonable basis and in good faith, except that this representation and
warranty does not apply to statements in or omissions from the Registration
Statement or the Prospectus made in reliance upon and in conformity with
information relating to any Underwriters furnished to the Company, the
Partnership, the General Partner or Enbridge in writing by an Underwriter
through Xxxxxxx, Xxxxx & Co. expressly for use therein;
(d) Enbridge's Incorporated Documents heretofore filed, when they were
filed (or, if any amendment with respect to any such document was filed, when
such amendment was filed), conformed in all material respects with the
requirements of the Exchange Act; any further Incorporated Documents of
Enbridge so filed will, when they are filed, conform in all material respects
with the requirements of the Exchange Act; no such document when it was filed
(or, if an amendment with respect to any such document was filed, when such
amendment was filed), contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading; and no such further
document, when it is filed, will contain an untrue statement of a material
fact or will omit to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading;
(e) The capitalization of as of the date set forth in the Prospectus,
is as set forth in the under the heading "Capitalization of Enbridge Inc." in
the Prospectus;
(f) Enbridge has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Province of Alberta,
Canada, with full corporate power and authority to own or lease its
properties and to conduct its business as described in the Prospectus.
Enbridge indirectly wholly owns the General Partner free and clear of any
lien, encumbrance, security interest, equity or charge (except for such
liens, encumbrances, security interests, equities or charges as are not,
individually or in the aggregate, material to such interest ownership or as
described in the Prospectus). The shares of stock in the General Partner
owned by Enbridge have been duly and validly authorized and issued and are
fully paid and non-assessable. Complete and correct copies of the Certificate
of Incorporation of Enbridge, and all amendments thereto, and of the By-Laws
of Enbridge, as amended, have been delivered to the Underwriters;
(g) The accountants, PricewaterhouseCoopers LLP, who have certified
Enbridge's financial statements incorporated by reference in the Registration
Statement and the Prospectus (or
9
any amendment or supplement thereto), are, in respect of Enbridge,
independent public accountants as required by the Act;
(h) The historical financial statements of Enbridge, together with
related schedules and notes, incorporated by reference in the Registration
Statement and the Prospectus (and any amendment or supplement thereto),
present fairly the consolidated financial position, results of operations and
changes in financial position of Enbridge on the basis stated in the
Registration Statement at the respective dates or for the respective periods
to which they apply; such statements and related schedules and notes have
been prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other summary and selected financial and statistical
information and data included or incorporated by reference in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto) are accurately presented and prepared on a basis consistent with
such financial statements and the books and records of Enbridge;
(i) Enbridge has all of the necessary corporate power and authority to
enter into this Agreement and consummate the transactions contemplated
hereby. The execution and delivery of, and the performance by Enbridge of its
obligations under this Agreement have been duly and validly authorized, and
this Agreement has been duly executed and delivered, by Enbridge;
(j) Enbridge has all of the necessary corporate power and authority to
enter into the Tax Indemnification Agreement and to adopt the Purchase
Provisions, and consummate the transactions contemplated thereby. Such
agreements have been duly authorized, and will have been duly executed and
delivered at the First Time of Delivery, by Enbridge. Each of such agreements
constitutes a valid and legally binding agreement of Enbridge, enforceable
against it in accordance with its terms, subject, as to enforcement, (i) to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights, (ii) to general
equity principles and (iii) as the rights to indemnification or contribution
thereunder may be limited by federal or state securities laws.
(k) Neither the execution, delivery or performance of this Agreement,
the Tax Indemnification Agreement and the Purchase Provisions, compliance by
Enbridge with the provisions hereof or thereof nor consummation by Enbridge
of the transactions contemplated hereby or thereby constitutes or, at the
First Time of Delivery will constitute, as the case may be, a breach of, or a
default under, the articles of incorporation or bylaws of Enbridge or any
contract, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which Enbridge is a party or by
which it may be bound or to which its properties is subject, nor will any
such action result in any violation of any existing law, regulation, ruling
(assuming compliance with all applicable federal, provincial and state
securities and Blue Sky laws), judgment, injunction, order or decree to which
it is a named party, excluding in each case any breaches, defaults or
violations which, individually or in the aggregate, would not have a material
adverse effect on the financial position or results of operations, business
or prospects of Enbridge and its subsidiaries (taken as a whole); and no
consent, approval, authorization, order, registration or qualification of or
with any court or governmental agency or body is required for the
consummation by Enbridge of the transactions contemplated by this Agreement,
except for the registration under the Act as described in Section 1(a) herein
and such consents, approvals, authorizations, registrations or qualifications
as may be required under state or provincial securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters;
10
(l) Enbridge has not distributed and, prior to the later to occur of
(i) the Time of Delivery and (ii) completion of the distribution of the
Shares, will not distribute any offering material in connection with the
offering and sale of the Shares other than the Prospectus or other materials,
if any, permitted by the Act;
(m) Enbridge is not and, as of the Time of Delivery will not be, an
"Investment Company" as that term is defined in the Investment Company Act,
or required to register as an "Investment Company" under the Investment
Company Act;
(n) Enbridge is not (i) a "public utility company," (ii) a "holding
company," (iii) a "subsidiary company" of a "registered holding company" or
of a "holding company" required to be registered under the 1935 Act, or (iv)
an "affiliate" of (A) a "registered holding company," (B) a "holding company"
required to be registered under the 1935 Act, (C) a "subsidiary company" of a
"registered holding company" or (D) a "subsidiary company" of a "holding
company" required to be registered under the 1935 Act, as such terms are
defined in the 0000 Xxx.
(o) There are no legal or governmental proceedings pending or, to the
knowledge of Enbridge, threatened, against Enbridge or any of its
subsidiaries, or to which Enbridge or any of its subsidiaries of any of their
respective properties, is subject, that are required to be described in the
Registration Statement or the Prospectus and are not described as required;
(p) Enbridge is not (a) in violation of its incorporation documents or
(b) in default in the performance or observance of any obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement, lease or other agreement or instrument to which it is a party
or by which it or any of its properties may be bound, except for such
violations or defaults as would not, individually or in the aggregate, have a
material adverse effect on the financial position, results of operations,
business or prospects of Enbridge and its subsidiaries (taken as a whole);
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at a purchase price per share of $___________ for Firm Shares to be sold to
the public [and $_________ for Firm Shares to be sold to Enbridge], the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I hereto and (b) in the event and to the extent that the
Underwriters shall exercise the election to purchase Optional Shares as
provided below, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at the purchase price per share set forth in
clause (a) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by you so
as to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction, the numerator of which is the maximum number
of Optional Shares which such Underwriter is entitled to purchase as set
forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the maximum number of Optional Shares that all of the
Underwriters are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to _____________ Optional Shares, at the purchase price per
share set forth in the paragraph above, for the sole purpose of covering
sales of shares in excess of the number of Firm Shares. Any such election to
purchase Optional Shares may be exercised only by written notice from you to
the Company, given within a period of 30 calendar days after the date of this
Agreement, setting forth the
11
aggregate number of Optional Shares to be purchased and the date on which
such Optional Shares are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Company otherwise agree in writing, earlier
than two or later than ten business days (as defined below in Section 14)
after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) Certificates in definitive form for the Shares to be purchased
by each Underwriter hereunder in such authorized denominations and registered
in such names as Xxxxxxx, Sachs & Co. may request upon at least forty-eight
hours' prior notice to the Company shall be delivered by or on behalf of the
Company to Xxxxxxx, Xxxxx & Co. , through the facilities of the Depository
Trust Company ("DTC") for the account of such Underwriter, against payment by
or on behalf of such Underwriter of the purchase price therefor by wire
transfer of federal (same-day) funds to the account specified by the Company
to Xxxxxxx, Sachs & Co. at least forty-eight hours in advance. The Company
will cause the certificates representing the Shares to be made available for
checking and packaging at least twenty four hours prior to the Time of
Delivery (as defined below) with respect thereto at the Closing Location (as
defined below). The time and date of such delivery and payment shall be, with
respect to the Firm Shares, 9:30 a.m., New York City time, on _____________,
2002 or such other time and date as Xxxxxxx, Xxxxx & Co. and the Company may
agree upon in writing and, with respect to the Optional Shares, shall be 9:30
a.m., New York time, on the date specified by Xxxxxxx, Sachs & Co. in the
written notice given by Xxxxxxx, Xxxxx & Co. of the Underwriters' election to
purchase such Optional Shares, or such other time and date as Xxxxxxx, Sachs
& Co. and the Company may agree upon in writing. Such time and date for
delivery of the Firm Shares is herein called the "First Time of Delivery",
such time and date for delivery of the Optional Shares, if not the First Time
of Delivery, is herein called the "Second Time of Delivery", and each such
time and date for delivery is herein called a "Time of Delivery".
(b) The Shares and documents to be delivered at each Time of
Delivery by or on behalf of the parties hereto pursuant to Section 7 hereof,
including the cross receipt for the Shares, will be delivered at the offices
of Xxxxxx & Xxxxxx L.L.P., 0000 Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000 (the
"Closing Location"). A meeting will be held at the Closing Location at 2:00
p.m., Houston time, on the business day next preceding such Time of Delivery,
at which meeting the final drafts of the documents to be delivered pursuant
to the preceding sentence will be available for review by the parties hereto.
5. Each of the Company, the General Partner, the Partnership and,
except in the case of (d), (f) and (g), Enbridge, agrees with each of the
Underwriters:
(a) 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 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 to the Registration Statement or Prospectus prior to the last Time of
Delivery which shall be disapproved by you promptly after reasonable notice
thereof; to advise you, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has been
filed and to furnish you with copies thereof; to file promptly all reports and
any definitive proxy or
12
information statements required to be filed with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date
of the Prospectus and for so long as the delivery of a prospectus is required
in connection with the transactions contemplated by the Prospectus; to advise
you, promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use
of any Preliminary Prospectus or prospectus, of the suspension of the
qualification of the Shares, i-units or Partnership's Class A Units for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any stop order
or of any order preventing or suspending the use of any Preliminary
Prospectus or prospectus or suspending any such qualification, promptly to
use commercially reasonable efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with
such laws so as to permit the continuance of sales and dealings therein in
such jurisdictions for as long as may be necessary to complete the
distribution of the Shares, provided that in connection therewith the Company
shall not be required to qualify as a foreign corporation or to file a
general consent to service of process in any jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the business day next
succeeding the date of this Agreement and from time to time, to furnish the
Underwriters with written and electronic copies of the Prospectus in New York
City in such quantities as you may reasonably request, and, if the delivery
of a prospectus is required at any time prior to the expiration of nine
months after the time of issue of the Prospectus in connection with the
offering or sale of the Shares and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Act or the Exchange Act, to notify you and upon your
request to file such document and to prepare and furnish without charge to
each Underwriter and to any dealer in securities as many written and
electronic copies as you may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case any Underwriter
is required to deliver a prospectus in connection with sales of any of the
Shares at any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter, to
prepare and deliver to such Underwriter as many written and electronic copies
as you may request of an amended or supplemented Prospectus complying with
Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the Act and the rules
and regulations thereunder (including, at the option of the Company, Rule
158);
13
(e) During the period beginning from the date hereof and continuing to
and including the date (i) 60 days after the date of the Prospectus with
respect to Class A Units or any securities substantially similar thereto or
(ii) 180 days after the date of the Prospectus with respect to Shares,
i-units or any securities substantially similar thereto (but not including
Class A Units), not to, directly or indirectly, offer, sell, contract to
sell, pledge, grant any option to purchase, make any short sale or otherwise
dispose of, except as provided hereunder and in the Prospectus, any
securities of the Company or the Partnership that are, or are substantially
similar to, Shares, i-units or Class A Units, or any options or warrants to
purchase any such securities including but not limited to any securities that
are convertible into or exchangeable for, or that represent the right to
receive, Shares, i-units or Class A Units or any such substantially similar
securities whether now owned (beneficially or otherwise, including holding as
a custodian) or hereinafter acquired (other than (A) the regular quarterly
splits of i-units by the Partnership to be received by the Company and the
corresponding issuance of Shares by the Company to the holders of the
Company's shares, (B) in connection with the acquisition of assets (other
than cash), businesses or the capital stock or other ownership interests of
businesses by any of Enbridge, the Partnership or any subsidiary of Enbridge
owning Common Units on the date hereof, or any operating subsidiary of the
Partnership owning Common Units on the date hereof, if the recipient(s) of
such securities agree(s) not to offer, sell, contract to sell, or otherwise
dispose of during such lock-up period any such securities received in
connection with such acquisition(s) and (C) pursuant to employee unit option
plans existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement)
without your prior written consent, it being expressly agreed that the
foregoing restriction shall preclude the Partnership, the General Partner,
Enbridge and the Company from engaging, directly or indirectly, in any
hedging or other transaction which is designed to or reasonably expected to
lead to or result in a sale or disposition of Shares, i-units or Class A
Units, or even if such Shares, i-units or Class A Units would be disposed of
by someone other than the Partnership, the General Partner, Enbridge or the
Company, including, without limitation, any short sale or any purchase, sale
or grant of any right (including, without limitation, any put or call option)
with respect to any of the Shares, i-units or Class A Units or with respect
to any security that includes, relates to, or derives any significant part of
its value from such Shares, i-units or Class A Units;
(f) To furnish to the Shareholders as soon as practicable after the
end of each fiscal year an annual report (including a balance sheet and
statements of income, shareholders' equity and cash flows of the Company and
its consolidated subsidiaries certified by independent public accountants)
and, as soon as practicable after the end of each of the first three quarters
of each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to the
Shareholders consolidated summary financial information of the Company and
its subsidiaries for such quarter in reasonable detail;
(g) During a period of five years from the effective date of the
Registration Statement, to furnish to you, or otherwise make publicly
available, copies of all reports or other communications (financial or other)
furnished to Shareholders, and to deliver to you such additional information
concerning the business and financial condition of the Company as you may
from time to time reasonably request;
(h) To use the net proceeds received by them from the sale of the
Shares pursuant to this Agreement in the manner specified in the Prospectus
under the caption "Use of Proceeds;"
14
(i) To use its best efforts to list, subject to notice of issuance, the
Shares of New York Stock Exchange (the "Exchange").
(j) To file with the Commission such information on Form 10-Q or Form
10-K as may be required by Rule 463 under the Act;
(k) If the Company, the Partnership or Enbridge elects to rely upon
Rule 462(b), the Company, the Partnership and Enbridge shall file a Rule
462(b) Registration Statement with the Commission in compliance with Rule
462(b), and the Company, the Partnership and Enbridge shall at the time of
filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment of
such fee pursuant to Rule 111(b) under the Act;
(l) Upon request of any Underwriter, to furnish, or cause to be
furnished, to such Underwriter an electronic version of the Company's
trademarks, servicemarks and corporate logo for use on the website, if any,
operated by such Underwriter for the purpose of facilitating the on-line
offering of the Shares (the "License"); PROVIDED, HOWEVER, that the License
shall be used solely for the purpose described above, is granted without any
fee and may not be assigned or transferred;
(m) The Partnership shall duly authorize and issue i-units to the
Partnership as contemplated in the Prospectus under "Use of Proceeds;"
(n) To authorize, execute and deliver by the Time of Delivery each of
the Tax Indemnification Agreement, the Delegation of Control Agreement, the
Third Amended and Restated Agreement of Limited Partnership of the
Partnership and the Company's Limited Liability Company Agreement (including
the Purchase Provisions), (all as described in the Prospectus); and
(o) To authorize, execute and deliver the amended and restated
agreements of limited partnership or limited liability company agreements, as
the case may be, of each of the Operating Subsidiaries promptly after the
Time of Delivery.
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the preparation,
printing or reproduction, and filing with the Commission of the Registration
Statement (including financial statements and exhibits thereto), any Preliminary
Prospectus, the Prospectus, each amendment or supplement to any of them and this
Agreement; (ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the Registration Statement, the Preliminary Prospectus, the Prospectus, the
Incorporated Documents, and all amendments or supplements to any of them, as may
be reasonably requested for use in connection with the offering and sale of the
Shares; (iii) the preparation, printing, authentication, issuance and delivery
of the Shares and the i-units; (iv) the printing (or reproduction) and delivery
of this Agreement, any Agreement among Underwriters, any preliminary or
supplemental Blue Sky Memoranda and all other agreements or documents printed
(or reproduced) and delivered in connection with the offering of the Shares; (v)
the listing of the Offered Units on the New York Stock Exchange; (vi) the
registration or qualification of the Shares or i-units for offer and sale under
the securities or Blue Sky laws of the several states as provided in Section
5(g) hereof, if required (including the reasonable fees, expenses and
disbursements of counsel for the Underwriters relating to the preparation,
printing or reproduction, and delivery of any preliminary or supplemental Blue
Sky Memoranda and such registration and qualification); (vii) the filing fees
and the fees and expenses of counsel for the Underwriters in connection with any
filings required to be made with the National Association of Securities Dealers,
15
Inc.; (viii) the transportation and lodging expenses incurred by or on behalf
of representatives of the Companies in connection with any presentations to
prospective purchasers of the Shares; (ix) the fees and expenses of the
accountants for the Enbridge Entities and Enbridge; (x) the fees and expenses
of counsel (including local and special counsel) for the Enbridge Entities
and Enbridge; and (xi) any fees payable to DTC in connection with the Shares
being book-entry only securities.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion,
to the condition that all representations and warranties and other statements
of the Company, the Partnership, the General Partner and Enbridge herein are,
at and as of such Time of Delivery, true and correct, the condition that each
of the Company, the Partnership, the General Partner and Enbridge shall have
performed all of their respective obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance with Section
5(a) hereof; if the Company, the Partnership or Enbridge has elected to rely
upon Rule 462(b), the Rule 462(b) Registration Statement shall have become
effective by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the Commission; and
all requests for additional information on the part of the Commission shall
have been complied with to your reasonable satisfaction;
(b) Xxxxxxx & Xxxxx Mayor, Day & Xxxxxxxx L.L.P., counsel for the
Underwriters, shall have furnished to you such written opinion, dated such
Time of Delivery, with respect to the matters covered in paragraphs (i)
(insofar as it relates to the due formation and good standing of the Company
and the Partnership in Delaware and the Company's and the Partnership's power
and authority to conduct its business as described in the Registration
Statement and the Prospectus, [(v)], and [(xv)] of the opinion attached
hereto as Annex I, as described in Annex I, as well as such other related
matters as you may reasonably request, and such counsel shall have received
such papers and information as they may reasonably request to enable them to
pass upon such matters;
(c) Xxxxxx & Xxxxxx L.L.P., counsel for the Company, the Partnership,
[the General Partner] and Enbridge shall have furnished to you their written
opinion, dated such Time of Delivery, in form and substance satisfactory to
you, to the effect set forth in Annex I hereto;
(d) Each of (i) Berkowitz, Lefkovits, Xxxx & Xxxxxxx, Birmingham,
Alabama, (ii) Xxxxx & Xxxxx, Prairie Village, Kansas, (iii) Xxxxx & Xxxxxxxx,
L.L.P., New Orleans, Louisiana, (iv) Brunini, Grantham, Grower & Xxxxx,
Jackson, Mississippi and (v) Xxxxx, Books, Xxxxx, Xxxxxxxx & Xxxxxx, each of
which is acting as special local counsel to the Enbridge Entities, shall have
furnished to you, its written opinion, dated such Time of Delivery, in form
and substance satisfactory to you, to the effect set forth in Annex II hereto;
(e) XxXxxxxx Xxxxxxxx LLP, Canadian counsel to the Enbridge Entities,
shall have furnished to you, its written opinion or opinions, dated as of the
Time of Delivery, in form and substance satisfactory to you, to the effect
set forth in Annex III hereto;
(f) On the date of the Prospectus, at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of
16
Delivery, PricewaterhouseCoopers LLP shall have furnished to you a letter or
letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to you, to the effect set forth in Annex IV and V,
respectively, hereto;
(g) None of the Enbridge Entities or Enbridge shall have sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus, and (ii) since the respective dates as of which information is
given in the Prospectus there shall not have been any change in the partners'
capital or capital stock, as applicable, or long-term debt of any of the
Enbridge Entities or Enbridge or any change, or any development involving a
prospective change, in or affecting the general affairs, management,
financial position, stockholders', unitholders' or interestholders' equity or
results of operations of any of the Enbridge Entities or Enbridge, otherwise
than as set forth or contemplated in the Prospectus, the effect of which, in
any such case described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(h) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded any of the Enbridge Entities' or Enbridge's debt
securities or preferred stock by any "nationally recognized statistical
rating organization", as that term is defined by the Commission for purposes
of Rule 436(g)(2) under the Act, and (ii) no such organization shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of any of the Enbridge Entities' or
Enbridge's debt securities or preferred stock;
(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 on the New York Stock Exchange; (ii) a suspension or
material limitation in trading in the Company's, the Partnership's or
Enbridge's securities on the NYSE; (iii) a general moratorium on commercial
banking activities declared by either federal or New York State authorities
or a material disruption in commercial banking or securities settlement or
clearance services in the United States; (iv) the outbreak or escalation of
hostilities involving the United States or the declaration by the United
States of a national emergency or war or (v) the occurrence of any other
calamity or crisis or any change in financial, political or economic
conditions in the United States or elsewhere, if the effect of any such event
specified in clause (iv) or (v) in the judgment of the Representatives makes
it impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the terms
and in the manner contemplated in the Prospectus;
(j) The Shares to be sold at such Time of Delivery shall have been duly
listed, subject to notice of issuance, on the Exchange;
(k) The Company has obtained and delivered to the Underwriters executed
copies of an agreement from (i) each executive officer, director or 5% equity
holder of the Company and the Partnership, other than the General Partner and
Enbridge, substantially to the effect set forth in Subsection 5(e) hereof in
form and substance satisfactory to you, and (ii) each person required by Rule
2110(d) of the NASD Conduct Rules in form and substance as is required by
such Rule, such executive officers, directors, equity holders and other
persons being listed on Schedule IV hereto;
17
(l) The Company, the Partnership and Enbridge shall have complied with
the provisions of Section 5(c) hereof with respect to the furnishing of
prospectuses on the Business Day next succeeding the date of this Agreement;
(m) The Company, the General Partner the Partnership and Enbridge shall
have furnished or caused to be furnished to you at such Time of Delivery
certificates of officers of the Company, the Partnership, the General Partner
and Enbridge satisfactory to you as to (i) the accuracy of the
representations and warranties of the Company, the Partnership, the General
Partner and Enbridge herein that are qualified by materiality, and as to the
accuracy in all material respects of the representations and warranties of
the Company, the Partnership, the General Partner and Enbridge herein that
are not so qualified, at and as of such Time of Delivery, (ii) as to the
performance in all material respects by each of the Company, the Partnership,
the General Partner and Enbridge of all of their respective obligations
hereunder to be performed at or prior to such Time of Delivery, (iii) as to
the matters set forth in subsections (a) and (g) of this Section and (iv) as
to such other matters as you may reasonably request;
(n) The following documents shall have been duly authorized, executed
and delivered and be in full force and effect: the Tax Indemnification
Agreement, the Delegation of Control Agreement, the Third Amended and
Restated Agreement of Limited Partnership of the Partnership and the
Company's Amended and Restated Limited Liability Company Agreement (including
the Purchase Provisions) (all as described in the Prospectus);
(o) The successful delegation of the General Partner's control and
management of the business and affairs of the shall have occurred; and
(p) The Partnership shall have duly and validly authorized and issued,
and the Company shall have purchased and shall own, the i-units, as
contemplated by the Prospectus.
8. (a) (i) Each of the Company, the Partnership and the General Partner
will, jointly and severally, indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Final Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, other than
any Enbridge Inc. Information or Enbridge Inc. Part II Information, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred and (ii) Enbridge will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Enbridge Inc. Information in the Final
Preliminary Prospectus, the Prospectus or the Registration Statement or in the
Enbridge Inc. Part II Information in the Registration Statement, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any
18
such action or claim as such expenses are incurred; PROVIDED, HOWEVER, that
the Company, the Partnership, the General Partner and Enbridge shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Final
Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Xxxxxxx,
Xxxxx & Co. expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company, the
Partnership, the General Partner and Enbridge against any losses, claims,
damages or liabilities to which the Company, the Partnership, the General
Partner and/or Enbridge may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the Final Preliminary Prospectus,
the Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, in each case to the extent,
but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Final Preliminary
Prospectus, the Registration Statement or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein; and will reimburse the Company, the
Partnership, the General Partner and/or Enbridge for any legal or other
expenses reasonably incurred by any of them in connection with investigating
or defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against a person who
is required to indemnify such indemnified party pursuant to subsection (a) or
(b) above (an "indemnifying party"), notify such indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to any indemnified party. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with
the consent of the indemnified party, be counsel to the indemnifying party),
and, after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof
other than reasonable costs of investigation. No indemnifying party shall,
without the written consent of the indemnified party, effect the settlement
or compromise of, or consent to the entry of any judgment with respect to,
any pending or threatened action or claim in respect of which indemnification
or contribution may be sought hereunder (whether or not the indemnified party
is an actual or potential party to such action or claim) unless such
settlement, compromise or judgment (i) includes an unconditional release of
the indemnified party from all liability arising out of such action or claim
and
19
(ii) does not include a statement as to or an admission of fault, culpability
or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company, the Partnership, the
General Partner and Enbridge on the one hand and the Underwriters on the
other from the offering of the Shares. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law or
if the indemnified party failed to give the notice required under subsection
(c) above, then each indemnifying party shall contribute to such amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company, the Partnership, the General Partner and Enbridge on the one hand
and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company, the
Partnership, the General Partner and Enbridge on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (after deducting underwriting discounts
and commissions, but before deducting expenses) received by the Company, the
Partnership, the General Partner and Enbridge bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus. The relative fault
shall be determined by reference to, among other things, (i) whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company, the Partnership, the General Partner or Enbridge on the one hand
or the Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission, and (ii) whether an indemnified party failed to give the notice
required under subsection (c) above. The Company, the Partnership, the
General Partner and Enbridge and the Underwriters agree that it would not be
just and equitable if contributions pursuant to this subsection (d) were
determined by PRO RATA allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), (i) no Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Shares underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission and (ii) Enbridge
shall not be required to contribute any amount unless it is or could have
been an indemnifying party pursuant to subsection (a). 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 Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
20
(e) The obligations of the Company, the Partnership, the General
Partner and Enbridge under this Section 8 shall be in addition to any
liability which the Company, the Partnership, the General Partner and
Enbridge may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this
Section 8 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company, the Partnership, the
General Partner and Enbridge (including any person who, with his or her
consent, is named in the Registration Statement as about to become a director
of the Company, the Partnership, the General Partner or Enbridge) and to each
person, if any, who controls the Company, the Partnership, the General
Partner or Enbridge within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery,
you may in your discretion arrange for you or another party or other parties
to purchase such Shares on the terms contained herein. If within thirty-six
hours after such default by any Underwriter you do not arrange for the
purchase of such Shares, then the Company shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties reasonably satisfactory to you to purchase such Shares on such terms.
In the event that, within the respective prescribed periods, you notify the
Company that you have so arranged for the purchase of such Shares, or the
Company notifies you that it has so arranged for the purchase of such Shares,
you or the Company shall have the right to postpone such Time of Delivery for
a period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus, or
in any other documents or arrangements, and the Company agrees to file
promptly any amendments to the Registration Statement or the Prospectus which
in your opinion may thereby be made necessary. The term "Underwriter" as used
in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to this
Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of
all the Shares to be purchased at such Time of Delivery, then the Company
shall have the right to require each non-defaulting Underwriter to purchase
the number of shares which such Underwriter agreed to purchase hereunder at
such Time of Delivery and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Shares
which such Underwriter agreed to purchase hereunder) of the Shares 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
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Shares of a defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to the Second Time of
Delivery, the obligations of the Underwriters to purchase and of the Company
to sell the Optional Shares) shall thereupon terminate, without liability on
the part of any non-defaulting
21
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 and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Partnership, the General Partner and
Enbridge and the several Underwriters, as set forth in this Agreement or made
by or on behalf of them, respectively, pursuant to this Agreement, shall
remain in full force and effect, regardless of any investigation (or any
statement as to the results thereof) made by or on behalf of any Underwriter
or any controlling person of any Underwriter, or the Company, the
Partnership, the General Partner or Enbridge, or any officer or director or
controlling person of the Company, the Partnership, the General Partner or
Enbridge, and shall survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except
as provided in Sections 6 and 8 hereof; but, if for any other reason, any
Shares 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 Shares not so delivered, but the
Company shall then be under no further liability to any Underwriter except as
provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made
or given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to you as the representatives in care of Xxxxxxx,
Sachs & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Registration Department; and if to the Company shall be delivered or sent by
mail to the address of the Company set forth in the Registration Statement,
Attention: Xxxxx Xxxxxxx, with a copy to Xxxxxx & Xxxxxx L.L.P., 0000 Xxxxxx,
Xxxxx 0000, Xxxxxxx, Xxxxx 00000-0000, Attention: Xxxxxxx X. Xxxxxxxx XX;
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
hereof shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire,
or telex constituting such Questionnaire, which address will be supplied to
the Company by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, the Partnership, the General
Partner and Enbridge and, to the extent provided in Sections 8 and 10 hereof,
the officers and directors of the Company, the Partnership, the General
Partner and Enbridge and each person who controls the Company, the
Partnership, the General Partner or Enbridge 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 Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
22
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. Each of the parties hereto irrevocably (i) agrees that any legal
suit, action or proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby may be instituted in any New York court,
(ii) waives, to the fullest extent it may effectively do so, any objection
which it may now or hereafter have to the laying of venue of any such
proceeding and (iii) submits to the exclusive jurisdiction of such courts in
any such suit, action or proceeding. Enbridge has appointed [ ], New York,
New York, as its authorized agent (the "Authorized Agent") upon whom process
may be served in any such action arising out of or based on this Agreement or
the transactions contemplated hereby which may be instituted in any New York
Court by any Underwriter or by any person who controls any Underwriter,
expressly consents to the jurisdiction of any such court in respect of any
such action, and waives any other requirements of or objections to personal
jurisdiction with respect thereto. Such appointment shall be irrevocable.
Enbridge represents and warrants that the Authorized Agent has agreed to act
as such agent for service at process and agrees to take any and all action,
including the filing of any and all documents and instruments, that may be
necessary to continue such appointment in full force and effect as aforesaid.
Service of process upon the Authorized Agent and written notice of such
service to Enbridge shall be deemed, in every respect, effective service of
process upon Enbridge.
17. In respect of any judgment or order given or made for any amount
due hereunder that is expressed and paid in a currency (the "judgment
currency") other than United States dollars, the Company, the Partnership,
the General Partner and, if Enbridge is or could have been an indemnifying
party under Section 8(a) in respect of such judgment or order, Enbridge, as
the case may be, will indemnify each Underwriter against any loss incurred by
such Underwriter as a result of any variation as between (i) the rate of
exchange at which the United States dollar amount is converted into the
judgment currency for the purpose of such judgment or order and (ii) the rate
of exchange at which an Underwriter is able to purchase United States dollars
with the amount of the judgment currency actually received by such
Underwriter. The foregoing indemnity shall constitute a separate and
independent obligation of the Company, the Partnership, the General Partner
and Enbridge and shall continue in full force and effect notwithstanding any
such judgment or order as aforesaid. The term "rate of exchange" shall
include any premiums and costs of exchange payable in connection with the
purchase of or conversion into United States dollars.
18. 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.
19. The Company is authorized, subject to applicable law, to disclose
any and all aspects of this potential transaction that are necessary to
support any U.S. federal income tax benefits expected to be claimed with
respect to such transaction, and all materials of any kind (including tax
opinions and other tax analyses) related to those benefits, without the
Underwriters imposing any limitation of any kind.
[rest of page intentionally left blank]
23
If the foregoing is in accordance with your understanding, please sign
and return to us, one for the Company and each of the Representatives plus
one for each counsel, counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement between each of the Underwriters
and the Company, the Partnership, the General Partner and Enbridge. 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,
Enbridge Energy Management, L.L.C.
By:
-----------------------
Name:
Title:
Enbridge Energy Partners, L.P.
By: Enbridge Energy Company, Inc.,
its General Partner
By:
-----------------------
Name:
Title:
Enbridge Energy Company, Inc.
By:
-----------------------
Name:
Title:
Enbridge Inc.
By:
-----------------------
Name:
Title:
24
Accepted as of the date hereof:
XXXXXXX, SACHS & CO.
[INSERT NAMES OF OTHER REPRESENTATIVES]
BY:
------------------------------------
On behalf of each of the Underwriters
25
SCHEDULE I
TOTAL NUMBER OF TOTAL NUMBER OF NUMBER OF OPTIONAL
FIRM SHARES TO BE FIRM SHARES TO BE SHARES TO BE PURCHASED
PURCHASED AND SOLD PURCHASED AND SOLD IF MAXIMUM
UNDERWRITER TO THE PUBLIC TO ENBRIDGE OPTION EXERCISED
----------- ------------- ----------- ----------------
Xxxxxxx, Xxxxx & Co.............................
Total
26
SCHEDULE IIA
CURRENT OPERATING SUBSIDIARIES
ENTITY JURISDICTION OF
------ ORGANIZATION
------------
Enbridge Energy, Limited Partnership Delaware
Enbridge Pipelines (North Dakota) L.L.C. North Dakota
Enbridge Pipelines (Lakehead) L.L.C. Delaware
[To be formed in July]
Enbridge Pipelines (East Texas) L.L.C. Delaware
Enbridge Pipelines (East Texas) L.P. Delaware
Enbridge Processing (East Texas) L.P. Delaware
Enbridge Marketing (East Texas) L.P. Delaware
SCHEDULE IIB
POST-CLOSING OPERATING SUBSIDIARIES
ENTITY JURISDICTION OF
------ ORGANIZATION
------------
Enbridge Energy, Limited Partnership Delaware
Enbridge Pipelines (North Dakota) L.L.C. North Dakota
Enbridge Pipelines (Lakehead) L.L.C. Delaware
[To be formed in July]
Enbridge Pipelines (East Texas) L.L.C. Delaware
Enbridge Pipelines (East Texas) L.P. Delaware
Enbridge Processing (East Texas) L.P. Delaware
Enbridge Marketing (East Texas) L.P. Delaware
Enbridge Midcoast Holdings, L.L.C. Delaware
Enbridge Holdings (Texas Systems) L.L.C. Delaware
Enbridge Pipelines (Louisiana Intrastate) L.L.C. Delaware
Enbridge Pipelines (SIGCO Intrastate) L.L.C. Delaware
Mid Louisiana Gas Transmission, L.L.C. Delaware
Enbridge Processing (Mississippi) L.L.C. Delaware
Xxxxxx Petroleum, L.P. Delaware
Enbridge Midcoast Energy, L.P. Texas
Pan Grande Pipeline, L.L.C. Texas
[Texana Pipeline Company N/A]
Enbridge Pipelines (Texas Intrastate) L.P. Texas
Enbridge Offshore Pipelines (Seacrest) L.P. Texas
Enbridge Offshore Pipelines (UTOS) L.L.C. Delaware
28
ENTITY JURISDICTION OF
------ ORGANIZATION
------------
Enbridge Pipelines (Louisiana Liquids) L.L.C. Delaware
Enbridge Pipelines (Texas Gathering) L.P. Delaware
Midcoast Kansas Pipeline, L.L.C. Delaware
Midcoast Kansas General Partner, L.L.C. Delaware
Margasco Partnership Oklahoma
Mid-Kansas Partnership Kansas
Riverside Pipeline Company, L.P. Kansas
Nugget Drilling Corporation Minnesota
Midcoast Holdings No. One, L.L.C. Delaware
Enbridge Pipelines (Alabama Intrastate) L.L.C. Alabama
Enbridge Pipelines (AlaTenn) L.L.C. Alabama
Enbridge Pipelines (Tennessee River) L.L.C. Alabama
Enbridge Pipelines (Midla) L.L.C. Delaware
H&W Pipeline, L.L.C. Alabama
Enbridge Marketing (U.S.) L.P. Texas
Enbridge Pipelines (Alabama Gathering) L.L.C. Alabama
Enbridge Pipelines (Bamagas Intrastate) L.L.C. Delaware
[Enbridge Pipelines (KPC)] Kansas
Enbridge Pipelines (NE Texas) L.L.C. Delaware
Enbridge Pipelines (NE Texas Liquids) L.L.C. Delaware
Enbridge Gathering (Texarkana) L.L.C. Delaware
29
SCHEDULE IIC
GENERAL PARTNER SUBSIDIARIES
ENTITY JURISDICTION OF
------ ORGANIZATION
------------
Enbridge Midcoast Holdings, L.L.C. [______]
Enbridge Holdings (Texas Systems) L.L.C. Delaware
Enbridge Pipelines (Louisiana Intrastate) L.L.C. Delaware
Enbridge Pipelines (Louisiana Intrastate) Inc. Delaware
Enbridge Pipelines (SIGCO Intrastate) L.L.C. Delaware
[Southern Industrial Gas Corporation N/A]
Mid Louisiana Gas Transmission, L.L.C. Delaware
Enbridge Processing (Mississippi) L.L.C. Delaware
Enbridge Processing (Mississippi) Inc. Delaware
Xxxxxx Petroleum, L.P. Delaware
Xxxxxx Petroleum, Inc. Delaware
Enbridge Midcoast Energy, Inc. Texas
Enbridge Pipelines (Texas Intrastate) Inc. Texas
Pan Grande Pipeline, L.L.C. Texas
[Texana Pipeline Company N/A]
Enbridge Offshore Pipelines (Seacrest) Inc. Texas
Enbridge Offshore Pipelines (UTOS) [L.L.C.] Delaware
Enbridge Pipelines (Louisiana Liquids) Inc. Delaware
Enbridge Pipelines (Texas Gathering) Inc. Delaware
Midcoast Kansas Pipeline, Inc. Delaware
Midcoast Kansas General Partner, Inc. Delaware
30
ENTITY JURISDICTION OF
------ ORGANIZATION
------------
Margasco Partnership Oklahoma
Mid-Kansas Partnership Kansas
Riverside Pipeline Company, L.P. Kansas
Nugget Drilling Corporation Minnesota
Midcoast Holdings No. One, Inc. Delaware
Enbridge Pipelines (Alabama Intrastate) Inc. Alabama
Enbridge Pipelines (AlaTenn) Inc. Alabama
Enbridge Pipelines (Tennessee Intrastate) Inc. Alabama
Enbridge Pipelines (Midla) Inc. Delaware
H&W Pipeline Corporation Alabama
Enbridge Marketing (U.S.) Inc. Texas
Enbridge Pipelines (Alabama Gathering) Inc. Alabama
Enbridge Pipelines (Bamagas Intrastate) Inc. Delaware
[Enbridge Pipelines (KPC)] Kansas
Enbridge Pipelines (NE Texas) L.L.C. Delaware
Enbridge Pipelines (NE Texas Liquids) L.L.C. Delaware
Enbridge Gathering (Texarkana) L.L.C. Delaware
31
SCHEDULE III
FOREIGN QUALIFICATIONS
[TO COME]
32
SCHEDULE IV
PERSONS EXECUTING LOCK-UP LETTERS
[TO COME]
33
ANNEX I
OPINION OF XXXXXX & XXXXXX L.L.P.
[TO COME]
34
ANNEX II
FORM OF LOCAL COUNSEL OPINION
CERTAIN DEFINITIONS
In this form of opinion, the following terms have the following meanings
unless the context otherwise requires:
"CONVERSIONS" will be defined as those listed on a schedule to the opinion,
being the conversions in the steps memo that affect the Operating
Subsidiaries and/or the OSGPs.
"ENBRIDGE ENTITIES" will be defined to mean the Company, the Partnership, the
General Partner, all OSGPs and all Operating Subsidiaries.
"MERGERS" will be defined as those listed on a schedule to the opinion, being
the mergers in the steps memo that affect the Operating Subsidiaries and/or
the OSGPs.
"OPERATING SUBSIDIARIES" means the Partnership's operating subsidiaries who
conduct business in the State, which will be listed on a schedule to the
opinion.
"OSGP" means the general partner(s), if any, of the Operating Subsidiaries,
which will be listed on a schedule to the opinion.
"STATE" means the state as to which counsel is opining.
"TRANSACTIONS" means all the Mergers and Conversions that affect the
Operating Subsidiaries and/or the OSGPs.
FORM OF OPINION
We have acted as special counsel in the State of ____________ to Enbridge
Energy Partners, L.P., a Delaware limited partnership (the "PARTNERSHIP"),
Enbridge Energy Company, Inc., a Delaware corporation (the "GENERAL
PARTNER"), and Enbridge Energy Management, L.L.C., a Delaware limited
liability company (the "COMPANY"), in connection with the transactions
contemplated by that certain
Underwriting Agreement dated [date], by and
among the Company, the Partnership, the General Partner, Enbridge Inc., a
Canadian corporation ("ENBRIDGE"), and the underwriters named therein (the
"
UNDERWRITING AGREEMENT"). This opinion is being delivered to you pursuant to
the request of our client pursuant to SECTION [7(d)] of the
Underwriting
Agreement. All capitalized terms used in this opinion and not otherwise
defined herein shall have the meanings set forth in the
Underwriting
Agreement.
In connection with this opinion letter, we have examined copies of the
following documents (the "TRANSACTION DOCUMENTS"):
(a) the Amended and Restated Limited Liability Company Agreement
of Management dated [date];
(b) [list organizational documents of Operating Subsidiaries and
OSGPs];
(c) the
Underwriting Agreement;
35
(d) the Registration Statement (File Nos. 333-89552, 333-89588 and
333-89618) in the form in which it became effective and Prospectus
dated [___________], 2002;
(e) [List relevant Plans/Articles/Certificates of Merger/Conversion]
(the "REORGANIZATION AGREEMENTS");
(f) [the form of Affidavit of Identity attached hereto as Exhibit
[__] (the "Affidavit");] and
(g) [list other documents reviewed].
We also have examined originals, or copies certified or otherwise identified,
of certain records of the Enbridge Entities and Enbridge as furnished to us
by representatives of those entities, certificates of public officials and of
representatives of the Enbridge Entities and Enbridge and statues and other
instruments and documents as a basis for the opinions hereinafter expressed.
[List counsel's customary assumptions - subject to review and comment]
Based on the foregoing and subject to the assumptions, qualifications and
limitations provided herein, we are of the opinion that:
(1) Each of [the OSGPs] [any Operating Subsidiary that is a limited
liability company] is duly [qualified] [registered] as a [foreign] limited
liability company for the transaction of business under the laws of the
State.
(2) Each of the Operating Subsidiaries is duly [qualified]
[registered] as a [foreign] limited partnership for the transaction of
business under the laws of the State.
(3) Each of [the OSGPs and] the Operating Subsidiaries has all
requisite power and authority as a limited liability company [or limited
partnership, as the case may be,] under the laws of the State to own or
lease its properties and to conduct its business in the State in each case
in all material respects to the same extent as described or otherwise
disclosed in the Prospectus with respect to the Partnership, and, upon the
consummation of the Transactions, and solely by virtue of the
Transactions, the [[member(s) of the OSGPs and the] [member(s)][limited
partner(s)] of the Operating Subsidiaries will not be liable under the
laws of the State for the liabilities of such entities, except in each
case to the same extent as under the laws of the State of Delaware.
(4) Assuming that each of the Transactions were legally sufficient
under each of the applicable laws (other than the laws of the State as to
which we make no such assumption, except as expressly set forth herein)
governing such Transactions to vest in each of the surviving entities the
assets of the applicable parties to such Transactions, then [(i)] the
[Transactions] [Mergers] [Conversions] are legally sufficient, under the
laws of the State, to so vest, directly or indirectly, in the respective
surviving entities the assets and liabilities of the respective entities
before each of such [Transactions] [Mergers] [Conversions] located in the
State [and (ii) the Conversions, together with the filing of a properly
completed Affidavit of Identity in the office of the County Clerk of each
county in which property of an Operating Subsidiary is located for all
assets located in the State, are legally sufficient, under the laws of the
State, to so vest, directly or indirectly, in the respective surviving
entities the assets and liabilities of the respective entities before each
of the Conversions].
(5) No permit, consent, approval, authorization, order, registration,
filing or qualification (collectively, "Consents") of or with any court,
governmental agency or body of the State
36
having jurisdiction over the Enbridge Entities or Enbridge or any of
their respective properties, is required for (A) the issuance and sale
of the Shares by Management or the Units by the Partnership or (B) the
execution and delivery by [the OSGPs and] the Operating Subsidiaries,
and the performance by such entities of their obligations under, the
Transaction Documents to which they are a party, except (a) for such
Consents required under state securities or "Blue Sky" laws, as to
which the undersigned does not express any opinion, (b) for such
Consents which have been obtained or made, (c) for such Consents which
are (i) of a routine or administrative nature, (ii) not customarily
obtained or made prior to the consummation of transactions such as
those contemplated under the Transaction Documents and (iii) expected
in the reasonable judgment of management of the applicable Enbridge
Entity to be obtained or made in the ordinary course of business
subsequent to the consummation of the Transactions, (d) for such
Consents which, if not obtained or made, would not, individually or in
the aggregate, have a material adverse effect upon the operations
conducted or to be conducted as described in the Prospectus in the
State by the Enbridge Entities, taken as a whole, (e) as disclosed in
the Prospectus with respect to the Partnership or (f) as otherwise
required by the Transaction Documents.
(6) The execution and delivery by [the OSGPs and] the Operating
Subsidiaries, and the performance by such entities of their obligations
under, the Transaction Documents to which they are a party has not
violated and will not violate any statute of the State or any rule,
regulation or, to our knowledge, any order of any agency of the State
having jurisdiction over any of the OSGPs and Operating Subsidiaries or
any of their respective properties, except for any such violations which,
individually or in the aggregate, would not have a material adverse effect
on the holders of Units or the operations conducted in the State by the
OSGPs and the Operating Subsidiaries, taken as a whole.
(7) [The Affidavit of Identity is in a form legally sufficient for
recordation in the appropriate public offices of the State, to the extent
such recordation is required to constitute notice to third parties that
title to the properties covered thereby is in the applicable Operating
Subsidiary following the consummation of the Transactions, and, upon
proper recordation thereof in the State, will constitute notice to all
third parties under the recordation statutes of the State concerning
record title to the assets covered thereby. Recordation in the office of
the [County Clerk] of each county in which property of an Operating
Subsidiary is located, is the appropriate public office in the State for
the recordation of deeds, assignments and other evidences of title
evidencing interests in real property located in such county.]
The opinions expressed herein are effective and based upon laws and matters
existing only as of the date hereof. We disclaim any undertaking to update,
review or modify any opinion herein in the future or in light of future
information, circumstances or changes in law that may effect the opinions
herein.
We express no opinion with respect to (i) title to any of the real or personal
property, (ii) the accuracy of descriptions or references to real or personal
property, (iii) [permits to own or operate any real or personal property,] or
(iv) with respect to state or local taxes or tax statutes including, without
limitation, those to which any of the limited partners of the Partnership may be
subject.
[List counsel's other customary qualifications - subject to review and
comment]
The Enbridge Entities, Enbridge, [list other Enbridge counsel, if any] and
Xxxxxx & Xxxxxx L.L.P. are hereby authorized to rely upon this opinion letter in
connection with the Transactions as if such opinion letter were addressed and
delivered to each of them on the date hereof. Subject to the
37
foregoing, this opinion letter may be relied upon only by you and your
counsel in connection with the Transactions and no other use or distribution
of this opinion letter may be made without our prior written consent.
ANNEX III
OPINION OF XXXXXXXX XXXXXXXX LLP
[TO COME]
38
ANNEX IV
[FORM OF COMFORT LETTER FOR THE COMPANY]
Pursuant to Section 7(d) of the
Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included in the Prospectus or the Registration Statement comply as to form
in all material respects with the applicable accounting requirements of
the Act and the related published rules and regulations thereunder; and,
if applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited consolidated interim financial statements, selected
financial data, pro forma financial information, financial forecasts
and/or condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports thereon, copies of which have been separately
furnished to the representatives of the Underwriters (the
"Representatives;
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus as
indicated in their reports thereon copies of which have been separately
furnished to the Representatives and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility
for financial and accounting matters regarding whether the unaudited
condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Act and the related published
rules and regulations, nothing came to their attention that cause them to
believe that the unaudited condensed consolidated financial statements do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus agrees
with the corresponding amounts (after restatements where applicable) in
the audited consolidated financial statements for such five fiscal years
which were included or incorporated by reference in the Company's Annual
Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and
on the basis of limited procedures specified in such letter nothing came
to their attention as a result of the foregoing procedures that caused
them to believe that this information does not conform in all material
respects with the disclosure requirements of Items 301, 302, 402 and
503(d), respectively, of Regulation S-K;
39
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of
the minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included in the Prospectus, inquiries
of officials of the Company and its subsidiaries responsible for financial
and accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) (i) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of
the Act and the related published rules and regulations, or (ii)
any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus for them to be in conformity with generally accepted
accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any
such unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included
in the Prospectus;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived any unaudited
condensed financial statements referred to in clause (A) and any
unaudited income statement data and balance sheet items included
in the Prospectus and referred to in clause (B) were not
determined on a basis substantially consistent with the basis for
the audited consolidated financial statements included in the
Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to form in
all material respects with the applicable accounting requirements
of the Act and the published rules and regulations thereunder or
the pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock
upon exercise of options and stock appreciation rights, upon
earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on the
date of the latest financial statements included in the
Prospectus) or any increase in the consolidated long-term debt of
the Company and its subsidiaries, or any decreases in consolidated
net current assets or stockholders' equity or other items
specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with
amounts shown in the latest balance sheet included in
40
the Prospectus, except in each case for changes, increases or
decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included in the Prospectus to the specified date
referred to in clause (E) there were any decreases in consolidated
net revenues or operating profit or the total or per share amounts
of consolidated net income or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable
period of the preceding year and with any other period of
corresponding length specified by the Representatives, except in
each case for decreases or increases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; and
(vii) In addition to the examination referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of
minute books, inquiries and other procedures referred to in paragraphs
(iii) and (vi) above, they have carried out certain specified procedures,
not constituting an examination in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and
financial information specified by the Representatives, which are derived
from the general accounting records of the Company and its subsidiaries,
which appear in the Prospectus, or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representatives,
and have compared certain of such amounts, percentages and financial
information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
41
ANNEX V
[FORM OF COMFORT LETTER
FOR THE PARTNERSHIP, ENBRIDGE AND ENBRIDGE MIDCOAST]
Pursuant to Section 7(d) of the
Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if
applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the consolidated interim financial statements, selected financial data,
pro forma financial information, financial forecasts and/or condensed
financial statements derived from audited financial statements of the
Company for the periods specified in such letter, as indicated in their
reports thereon, copies of which have been separately furnished to the
representatives of the Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus
and/or included in the Company's quarterly report on Form 10-Q
incorporated by reference into the Prospectus as indicated in their
reports thereon copies of which have been separately furnished to the
Representatives; and on the basis of specified procedures including
inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i)
below comply as to form in the related in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and the
related published rules and regulations, nothing came to their attention
that caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects
with the applicable accounting requirements of the Act and the Exchange
Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for such five fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and
on the basis of limited procedures specified in such letter nothing came
to their attention as a result of the foregoing procedures
that caused them to believe that this information does not conform in all
material respects with the disclosure requirements of Items 301, 302, 402
and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of
the minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or
incorporated by reference in the Company's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus do not
comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the related
published rules and regulations, or (ii) any material
modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus
or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any
such unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included
or incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited
condensed financial statements referred to in clause (A) and any
unaudited income statement data and balance sheet items included
in the Prospectus and referred to in clause (B) were not
determined on a basis substantially consistent with the basis for
the audited financial statements included or incorporated by
reference in the Company's Annual Report on Form 10-K for the most
recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus
do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the published
rules and regulations thereunder or the pro forma adjustments have
not been properly applied to the historical amounts in the
compilation of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock
upon exercise of options and stock appreciation rights, upon
earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on the
date of the latest balance sheet included or incorporated by
reference in the Prospectus) or any increase in the consolidated
long-term debt of the Company and its subsidiaries, or any
decreases in consolidated net current assets or stockholders'
equity or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each
case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus
to the specified date referred to in clause (E) there were any
decreases in consolidated net revenues or operating profit or the
total or per share amounts of consolidated net income or other
items specified by the Representatives, or any increases in any
items specified by the Representatives, in each case as compared
with the comparable period of the preceding year and with any
other period of corresponding length specified by the
Representatives, except in each case for increases or decreases
which the Prospectus discloses have occurred or may occur or which
are described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an examination in
accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference) or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the
Prospectus specified by the Representatives, and have compared certain of
such amounts, percentages and financial information with the accounting
records of the Company and its subsidiaries and have found them to be in
agreement.
