Suburban Propane Partners, L.P.
2,600,000 Common Units
Representing Limited Partner Interests
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Underwriting Agreement
December 10, 2003
Xxxxxxx, Xxxxx & Co.,
As representative 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:
Suburban Propane Partners, L.P., a Delaware limited partnership (the
"Partnership"), 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 2,600,000 common units (the "Firm Units")
representing limited partner interests in the Partnership (the "Common Units")
and, at the election of the Underwriters, up to 390,000 additional Common Units
(the "Optional Units"). The Firm Units and the Optional Units that the
Underwriters elect to purchase pursuant to Section 2 hereof are collectively
called the "Units."
Concurrently with the offering of the Units, the Partnership is offering in
a private placement $150.0 million aggregate principal amount of Senior Notes
due 2013 (the "Senior Notes"). Neither the offering of the Units nor the
concurrent private placement of the Senior Notes is contingent on the completion
of the other. The net proceeds of this offering, together with the proceeds from
the concurrent offering of the Senior Notes, will be used to fund the
acquisition (the "Acquisition") of substantially all of the assets and
operations of Agway Energy Products LLC, Agway Energy Services, Inc. and Agway
Energy Services PA, Inc. (collectively, "Agway Energy") and for general
partnership purposes.
The Partnership and Suburban Propane, L.P., a Delaware limited partnership
(the "Operating Partnership"), are collectively referred to herein as the
"Partnership Entities," and Suburban Sales & Service, Inc., a Delaware
corporation, Suburban Holdings, Inc., a Delaware corporation, Suburban @ Home,
Inc., a Delaware corporation, Suburban Franchising, Inc., a Nevada corporation,
and Gas Connection, Inc., an Oregon corporation, all of which are subsidiaries
of the Operating Partnership, are collectively referred to herein as the
"Subsidiaries."
1. The Partnership represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-109714) (the
"Initial Registration Statement") in respect of the Units 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, and, excluding exhibits thereto but including all documents
incorporated by reference in the prospectus contained therein, to you for
each of the other Underwriters, have been declared effective by the
Commission in such form; other than 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, 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 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 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;" and such
final prospectus, in the form first filed pursuant to Rule 424(b) under the
Act, is hereinafter called the "Prospectus;" and any reference herein to
any Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the Act (the "Incorporated Documents"), as of the
date of such Preliminary Prospectus or Prospectus, as the case may be; and
any reference to any amendment or supplement to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any documents
filed after the date of such 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 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 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;
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Partnership by an Underwriter
through Xxxxxxx, Xxxxx & Co. expressly for use therein;
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(c) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as
the case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Partnership by an
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein;
(d) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto, and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the
Partnership by an Underwriter through Xxxxxxx, Xxxxx & Co. expressly for
use therein;
(e) Neither of the Partnership Entities nor any of the Subsidiaries
has 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, that, individually or in the
aggregate, would have a material adverse effect on the business, prospects,
operations, financial condition or results of operations of the Partnership
Entities and the Subsidiaries taken as a whole (a "Material Adverse
Effect"), otherwise than as set forth or contemplated in the Prospectus;
and, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any change in
the partners' capital or long-term debt (other than borrowings under the
Operating Partnership's existing credit facility) of either of the
Partnership Entities or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, partners' capital or
results of operations of either of the Partnership Entities, otherwise than
as set forth or contemplated in the Prospectus;
(f) Each of the Partnership Entities and the Subsidiaries has good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned by it, in each case free and clear of
all liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such property
and do not materially interfere with the use made and proposed to be made
of such property by that Partnership Entity or Subsidiary; and all real
property and buildings held under lease by a
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Partnership Entity or Subsidiary are held under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
materially interfere with the use made and proposed to be made of such
property and buildings by the lessee;
(g) Each of the Partnership Entities is and at each Time of Delivery
(as defined in Section 4(a) hereof) will be a limited partnership duly
formed, validly existing and in good standing under the laws of the state
of Delaware, with all necessary partnership power and authority to own its
properties and conduct its business as described in the Prospectus, and has
been duly licensed or qualified to do business and is in good standing as a
foreign limited partnership in all jurisdictions in which it owns or leases
properties or conducts any business so as to require such licensing or
qualification, except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect. Complete and correct
copies of the certificates of limited partnership of the Partnership and
the Operating Partnership, and all amendments thereto, and of the
agreements of limited partnership of the Partnership, as amended and
restated (the "Partnership Agreement") and the Operating Partnership, as
amended and restated (the "Operating Partnership Agreement"), have been
delivered to the Underwriters;
(h) Suburban Energy Services Group LLC, the general partner of each of
the Partnership Entities (the "General Partner"), has been, and at the
applicable Time of Delivery will be, duly formed and is validly existing as
a limited liability company in good standing under the laws of the state of
Delaware, with limited liability company power and authority to own its
properties and conduct its business as described in the Prospectus, and has
been duly qualified as a foreign limited liability company for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, except where the failure to
be so qualified or in good standing would not have a Material Adverse
Effect. Complete and correct copies of the certificate of formation and the
limited liability company agreement of the General Partner, and all
amendments thereto, have been delivered to the Underwriters;
(i) Each of the Subsidiaries has been, and at the applicable Time of
Delivery will be, duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority to own its properties and
conduct its business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns
or leases properties or conducts any business so as to require such
qualification, except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect. Complete and correct
copies of the certificate of incorporation and the bylaws of each of the
Subsidiaries have been delivered to the Underwriters;
(j) The Partnership has no direct or indirect subsidiaries (other than
the Operating Partnership and the Subsidiaries) that, taken as a whole,
would be deemed to be a significant subsidiary (as such term is defined in
Section 1-02 of Regulation S-X under the Act);
(k) The General Partner is the sole general partner of the Partnership
with a 0.70% general partner interest in the Partnership; such general
partner interest is duly authorized by the Partnership Agreement and was
validly issued to the General Partner; and, the General Partner owns such
general partner interest free and clear of all liens, encumbrances,
security interests, equities, charges or claims (except for such liens,
encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material to such ownership or as
described in the Registration Statement or the Prospectus);
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(l) The General Partner is the sole general partner of the Operating
Partnership with a 1.0101% general partner interest in the Operating
Partnership; such general partner interest is duly authorized by the
Operating Partnership Agreement, and was validly issued to the General
Partner; and the General Partner owns such general partner interest free
and clear of all liens, encumbrances, security interests, equities, charges
or claims (except for such liens, encumbrances, security interests,
equities, charges or claims as would not, individually or in the aggregate,
be material to such ownership or as described in the Registration Statement
or the Prospectus);
(m) The Partnership is the sole limited partner of the Operating
Partnership with a limited partner interest of 98.9899%; such limited
partner interest is duly authorized by the Operating Partnership Agreement,
and was validly issued to the Partnership and is fully paid and
nonassessable (except as nonassessability may be affected by the legal
issues described with respect to holders of the Common Units in the "Risk
Factors" section of the Prospectus under the captions "Unitholders may not
have limited liability in some circumstances" and "Unitholders may have
liability to repay distributions"); and the Partnership owns such limited
partner interest free and clear of all liens, encumbrances, security
interests, equities, charges or claims (except for such liens,
encumbrances, security interests, equities, charges or claims as would not,
individually or in the aggregate, be material to such ownership or as
described in the Registration Statement or the Prospectus);
(n) All of the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and are fully paid and
nonassessable; and the issued shares of capital stock of each of the
Subsidiaries are owned by the Operating Partnership, free and clear of all
liens, encumbrances, security interests, equities, charges or other claims;
all of the outstanding membership interests of the General Partner are
owned by management and other key employees of the Partnership;
(o) The Partnership has an authorized capitalization as set forth in
the Prospectus, and all of the issued and outstanding Common Units of the
Partnership have been duly and validly authorized and issued, are fully
paid and nonassessable (except as nonassessability may be affected by the
legal issues described with respect to holders of the Common Units in the
"Risk Factors" section of the Prospectus under the captions "Unitholders
may not have limited liability in some circumstances" and "Unitholders may
have liability to repay distributions") and conform to the description of
the Common Units contained in the Prospectus;
(p) The Units to be issued and sold by the Partnership to the
Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be
duly and validly issued and fully paid and nonassessable (except as
nonassessability may be affected by the legal issues described with respect
to holders of the Common Units in the "Risk Factors" section of the
Prospectus under the captions "Unitholders may not have limited liability
in some circumstances" and "Unitholders may have liability to repay
distributions") and will conform to the description of the Common Units
contained in the Prospectus;
(q) The issue and sale of the Units by the Partnership and the
compliance by the Partnership with all of the provisions of this Agreement
and compliance by the Operating Partnership with the provisions of Section
7 hereof, and the consummation of the transactions herein contemplated,
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which either of the Partnership Entities or any
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of the Subsidiaries is a party or by which either of the Partnership
Entities or any of the Subsidiaries is bound or to which any of the
property or assets of either of the Partnership Entities or any of the
Subsidiaries is subject, nor will such action result in any violation of
the provisions of the partnership agreement of either of the Partnership
Entities or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over either of the
Partnership Entities or any of the Subsidiaries or any of their properties,
except for breaches, violations or defaults (other than those relating to
the partnership agreement of either of the Partnership Entities) that would
not, individually or in the aggregate, have a Material Adverse Effect or
impair the Partnership's ability to consummate the transactions herein
contemplated; and no consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or body
is required for the issue and sale of the Units or the consummation by the
Partnership of the transactions contemplated by this Agreement and the
Operating Partnership with the provisions in Section 7 hereof, except the
registration under the Act of the Units and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Units by the Underwriters;
(r) The financial statements and pro forma financial data, together
with related schedules and notes, included or incorporated by reference in
the Registration Statement or the Prospectus present fairly (i) the
consolidated financial condition of the Partnership and the combined
financial condition of Agway Energy, in each case, as of the respective
dates thereof and (ii) the consolidated results of operations and cash
flows of the Partnership and the combined results of operations and cash
flows of Agway Energy, in each case, for the respective periods covered
thereby; such statements and related schedules and notes have been prepared
in accordance with generally accepted accounting principles consistently
applied throughout the entire period involved, except as otherwise
disclosed in the Prospectus; and the other financial and statistical
information included or incorporated by reference in the Registration
Statement or the Prospectus are accurately presented and prepared on a
basis consistent with such financial statements and the books and records
of the Partnership. No other financial statements or schedules of the
Partnership are required by the Act, the Exchange Act or the rules and
regulations of the Commission under such acts to be included in the
Registration Statement or the Prospectus;
(s) The Partnership and the Operating Partnership (with respect to
Section 7 hereof) have all necessary partnership power and authority to
enter into this Agreement. This Agreement has been duly authorized,
executed and delivered by each of the Partnership Entities and constitutes
a valid and binding agreement of each of the Partnership Entities and is
enforceable against each of the Partnership Entities in accordance with its
terms; provided that such enforceability may be limited (i) by bankruptcy,
insolvency, fraudulent transfer, moratorium and similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (ii) as to rights to indemnification or contribution
by considerations of public policy related to federal or state securities
laws;
(t) The Partnership Agreement has been duly authorized, executed and
delivered by the General Partner and is a valid and legally binding
agreement of the General Partner, enforceable against the General Partner
in accordance with its terms; the Operating Partnership Agreement has been
duly authorized, executed and delivered by each of the General Partner and
the Partnership, and is a valid and legally binding agreement of the
General Partner and the Partnership, enforceable against each of them in
accordance with its
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terms; provided that, with respect to each such agreement, the
enforceability thereof may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law);
(u) None of the Partnership Entities, the Subsidiaries and the General
Partner is in violation of its certificate of incorporation, certificate of
formation, by-laws, partnership agreement or limited liability company
agreement, or in default in the performance or observance of any material
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 defaults that, individually or in the
aggregate, would not have a Material Adverse Effect;
(v) The statements set forth in the Prospectus under the caption
"Description of Common Units," insofar as they purport to constitute a
summary of the terms of the Common Units, under the caption "Tax
Considerations" and under the caption "Underwriting," insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate and complete in all material respects;
(w) There are no preemptive rights or other rights to subscribe for or
to purchase, nor any restrictions upon the voting or transfer of, any
common units, equity interests or shares of stock in any of the Partnership
Entities and the Subsidiaries, except as described in the Prospectus. The
offering and sale of Units as contemplated by this Agreement does not give
rise to any rights, other than those which have been waived or satisfied,
for or relating to the registration of any partnership interests or other
securities of either of the Partnership Entities. Other than as described
in the Prospectus, there are no outstanding options or warrants to purchase
any Common Units or other securities of either of the Partnership Entities.
There are no rights entitling any holder of partnership interests in the
Partnership to cause the Partnership to register any of such interests,
other than pursuant to the Partnership Agreement or as described in the
Prospectus, and such registration rights will not be triggered in
connection with the offering and sale of Units as contemplated by this
Agreement;
(x) Each of the Partnership Entities and the Subsidiaries (i) is in
compliance with any and all applicable foreign, federal, state and local
laws and regulations relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants, or
contaminants ("Environmental Laws"), (ii) has received all permits,
licenses or other approvals required of it under applicable Environmental
Laws to conduct its respective businesses and (iii) is in compliance with
all terms and conditions of any such permit, license or approval, except
where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals would not,
individually or in the aggregate, have a Material Adverse Effect;
(y) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean up, closure or properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) which would, individually or in the aggregate, have a Material
Adverse Effect;
(z) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which either of the Partnership
Entities or any of the Subsidiaries is a party or of which any property of
either of the Partnership Entities or any of the Subsidiaries is
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the subject which, if determined adversely to either of the Partnership
Entities or any of the Subsidiaries, would, individually or in the
aggregate, have a Material Adverse Effect; and, to the knowledge of the
Partnership's management, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(aa) Neither of the Partnership Entities is, nor, after giving effect
to the offering and sale of the Units, will be, (i) an "investment
company," as such term is defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act"), or (ii) subject to regulation as a
"holding company" or a "subsidiary company" of a holding company or
"affiliate" thereof, under the Public Utility Holding Company Act of 1935,
as amended (the "PUHCA");
(bb) Each of the Partnership Entities and the Subsidiaries has such
permits, consents, licenses, franchises, certificates and authorizations of
governmental or regulatory authorities ("permits") as are necessary to own
its properties and to conduct its business in the manner described in the
Prospectus, subject to such qualifications as may be set forth in the
Prospectus and except for such permits the failure of which to have
obtained would not have, individually or in the aggregate, a Material
Adverse Effect; each of the Partnership Entities and the Subsidiaries has
fulfilled and performed all its material obligations with respect to such
permits and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any
impairment of the rights of the holder of any such permit, except for such
revocations, terminations and impairments that would not have a Material
Adverse Effect; and, except as described in the Prospectus, none of such
permits contains any restriction that is materially burdensome to the
Partnership Entities and the Subsidiaries considered as a whole;
(cc) Neither of the Partnership Entities nor any of their respective
affiliates does business with the government of Cuba or with any person or
affiliate located in Cuba within the meaning of Section 517.075, Florida
Statutes;
(dd) The Partnership Entities maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences;
(ee) The Partnership has established and maintains disclosure controls
and procedures (as such term is defined in Rule 13a-15 under the Exchange
Act), which (i) are designed to ensure that material information relating
to the Partnership, including its consolidated subsidiaries, is made known
to its principal executive officer and its principal financial officer by
others within those entities, particularly during the periods in which the
periodic reports required under the Exchange Act are being prepared; (ii)
have been evaluated for effectiveness as of the date of the filing of the
Partnership's most recent annual or quarterly report filed with the
Commission; and (iii) are effective in all material respects to perform the
functions for which they were established;
(ff) Based on the evaluation of its disclosure controls and
procedures, the Partnership is not aware of (i) any significant deficiency
in the design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the Partnership's ability
to record, process, summarize and report financial data or any material
weaknesses in internal
8
controls; or (ii) any fraud, whether or not material, that involves
management or other employees who have a significant role in the
Partnership's internal control over financial reporting;
(gg) Since the date of the most recent evaluation of such disclosure
controls and procedures, there have been no significant changes in internal
control over financial reporting or in other factors that could
significantly affect internal control over financial reporting, including
any corrective actions with regard to significant deficiencies and material
weaknesses;
(hh) For each taxable year of the Partnership, less than 10% of the
gross income of the Partnership has been derived from sources other than
(i) the exploration, development, production, processing, refining,
transportation or marketing of any mineral or natural resource, including
oil, gas or products thereof, or (ii) other items of qualifying income
within the meaning of Section 7704(d) of the Internal Revenue Code of 1986,
as amended; and
(ii) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Partnership Entities and Agway Energy, are independent
public accountants as required by the Act and the rules and regulations of
the Commission thereunder.
2. Subject to the terms and conditions herein set forth, (a) the
Partnership agrees to issue and sell to each of the Underwriters, and each of
the Underwriters agrees, severally and not jointly, to purchase from the
Partnership, at a purchase price per Unit of $29.59, the number of Firm Units
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 Units as provided below, the Partnership agrees to issue and
sell to each of the Underwriters, and each of the Underwriters agrees, severally
and not jointly, to purchase from the Partnership, at the purchase price per
share set forth in clause (a) of this Section 2, that portion of the number of
Optional Units as to which such election shall have been exercised (to be
adjusted by you so as to eliminate fractional units) determined by multiplying
such number of Optional Units by a fraction, the numerator of which is the
maximum number of Optional Units 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 Units that all of the
Underwriters are entitled to purchase hereunder.
The Partnership hereby grants to the Underwriters the right to purchase at
their election up to 390,000 Optional Units, at the purchase price per share set
forth in the paragraph above, for the sole purpose of covering sales of Units in
excess of the number of Firm Units. Any such election to purchase Optional Units
may be exercised only by written notice from you to the Partnership, given
within a period of 30 calendar days after the date of this Agreement, setting
forth the aggregate number of Optional Units to be purchased and the date on
which such Optional Units are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as defined in Section 4(a)
hereof) or, unless you and the Partnership otherwise agree in writing, no
earlier than two or later than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Units, the
several Underwriters propose to offer the Firm Units for sale upon the terms and
conditions set forth in the Prospectus.
4. (a) The Units to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Xxxxx & Co. may request upon at least forty-eight hours' prior
notice to the Partnership shall be delivered by or on behalf of the Partnership
to Xxxxxxx, Sachs & Co. through the facilities of the Depository Trust Company
("DTC"), for the account of such Underwriter, against payment by or on behalf
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of such Underwriter of the purchase price therefor by wire transfer of Federal
(same-day) funds to the account specified by the Partnership to Xxxxxxx, Xxxxx &
Co. at least forty-eight hours in advance. The Partnership will cause the
certificates representing the Units 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 office of DTC or its designated custodian
(the "Designated Office"). The time and date of such delivery and payment shall
be, with respect to the Firm Units, 9:30 a.m., New York City time, on December
16, 2003 or such other time and date as Xxxxxxx, Sachs & Co. and the Partnership
may agree upon in writing, and, with respect to the Optional Units, 9:30 a.m.,
New York time, on the date specified by Xxxxxxx, Xxxxx & Co. in the written
notice given by Xxxxxxx, Sachs & Co. of the Underwriters' election to purchase
such Optional Units, or such other time and date as Xxxxxxx, Xxxxx & Co. and the
Partnership may agree upon in writing. Such time and date for delivery of the
Firm Units is herein called the "First Time of Delivery," such time and date for
delivery of the Optional Units, 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 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 Units and any additional documents requested by the
Underwriters pursuant to Section 7(k) hereof, will be delivered at the
offices of Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx,
Xxx Xxxx 00000 (the "Closing Location"), and the Units will be delivered at
the Designated Office, all at such Time of Delivery. A meeting will be held
at the Closing Location at 4:00 p.m., New York City time, on the New York
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. For the
purposes of this Section 4(b), "New York Business Day" shall mean each
Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in New York are generally authorized or obligated by
law or executive order to close.
5. The Partnership 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 information statements required to be filed by the
Partnership 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
offering or sale of the Units; 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 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
10
preventing or suspending the use of any Preliminary Prospectus or
Prospectus or suspending any such qualification, promptly to use its best
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 Units 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 Units, provided that in connection therewith the
Partnership 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 New York 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 Units 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 Units 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 the Partnership's 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 Partnership and its
consolidated 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 Partnership, Rule 158);
(e) During the period beginning from the date hereof and continuing to
and including the date 90 days after the date of the Prospectus, not to
offer, sell, contract to sell or otherwise dispose of, except as provided
hereunder, any securities of the Partnership that are substantially similar
to the Units, including but not limited to any securities that are
convertible into or exchangeable for, or that represent the right to
receive, Common Units or any such substantially similar securities (other
than pursuant to employee benefit plans, unit option plans or restricted
unit plans existing on, or upon the conversion or exchange of convertible
or exchangeable securities outstanding as of, the date of this Agreement),
without Xxxxxxx, Sachs & Co.'s prior written consent, it being expressly
agreed that the foregoing restriction shall preclude the Partnership from
engaging in any hedging or other transaction which is designed to or
reasonably expected to lead to or result in a sale or disposition of the
Common Units even if such Common Units would be disposed of by someone
other than the
11
Partnership, 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 Common Units or with respect to any
security that includes, relates to, or derives any significant part of its
value from such Common Units;
(f) To furnish to the Partnership's unitholders as soon as practicable
after the end of each fiscal year an annual report (including a balance
sheet and statements of income, partners' capital and cash flows of the
Partnership 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 its unitholders consolidated summary financial
information of the Partnership and its subsidiaries for such quarter in
reasonable detail;
(g) During a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to unitholders, and to
deliver to you (i) as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any
national securities exchange on which any class of securities of the
Partnership is listed; and (ii) such additional information concerning the
business and financial condition of the Partnership as you may from time to
time reasonably request (such financial statements to be on a consolidated
basis to the extent the accounts of the Partnership and its subsidiaries
are consolidated in reports furnished to its unitholders generally or to
the Commission);
(h) To use the net proceeds received by it from the sale of the Units
pursuant to this Agreement in the manner specified in the Prospectus under
the caption "Use of Proceeds;"
(i) To use its best efforts to list, subject to notice of issuance,
the Units on The New York Stock Exchange (the "Exchange"); and
(j) If the Partnership elects to rely upon Rule 462(b), the
Partnership shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 p.m., Washington, D.C.
time, on the date of this Agreement, and the Partnership 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.
6. The Partnership covenants and agrees with the several Underwriters that
the Partnership will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Partnership's counsel and accountants in
connection with the registration of the Units under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, closing documents (including
any compilations thereof) and any other documents in connection with the
offering, purchase, sale and delivery of the Units; (iii) all expenses in
connection with the qualification of the Units for offering and sale under state
securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification; (iv) all fees and expenses in connection with listing the Units
on the Exchange; (v) the filing fees incident to, and the fees and disbursements
of counsel for the Underwriters in connection with, securing any required review
by the National Association of Securities Dealers, Inc. of the terms of the sale
of the Units; (vi) the cost of preparing certificates representing Common Units,
if any; (vii) the cost and
12
charges of any transfer agent or registrar; and (viii) all other costs and
expenses incident to the performance of the Partnership's obligations hereunder
which are not otherwise specifically provided for in this Section. It is
understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, stock transfer taxes on resale of any of
the Units by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters hereunder, as to the Units 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 Partnership herein are, at and as of such Time of Delivery, true and
correct, the condition that the Partnership shall have performed all of its
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 Partnership 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) Xxxxxx & Xxxxxxx LLP, counsel for the Underwriters, shall have
furnished to you their written opinion, dated such Time of Delivery, with
respect to the matters covered in paragraphs (i), (ii), (iv), (vii)
(insofar as paragraph (vii) relates to the "Description of Common Units")
and (xiii) of subsection (c) below 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 & Xxxxxxx LLP, counsel for the Partnership, shall
have furnished to you their written opinion, dated such Time of Delivery,
in form and substance satisfactory to you, to the effect that:
(i) Each of the Partnership Entities is validly existing as a
limited partnership in good standing under the laws of the State of
Delaware, with power and authority to own its properties and conduct
its business as described in the Prospectus;
(ii) This Agreement has been duly authorized, executed and
delivered by each of the Partnership and the Operating Partnership;
(iii) The issue and sale of the Units being delivered at such
Time of Delivery by the Partnership, the compliance by the Partnership
with all of the provisions of this Agreement and the compliance by the
Operating Partnership with the provisions of Section 8 hereof and the
consummation of the transactions herein contemplated do not conflict
with or violate any of the terms or provisions of, or constitute a
breach or default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such counsel to
which either of the Partnership Entities is a party or is bound and
that is material to that Partnership Entity, nor will such action
result in any violation of the provisions of the partnership agreement
of either of the Partnership Entities or any Delaware partnership or
federal statute or any order, rule or regulation (other than foreign
and state securities or Blue Sky
13
Laws, as to which such counsel expresses no opinion), or any judgment,
writ, injunction, decree, order or ruling of any court or governmental
agency or body having jurisdiction over either of the Partnership
Entities of which such counsel is aware;
(iv) No consent, approval, authorization, order, registration or
qualification of or with any Delaware or federal governmental agency
or body is required for the issue and sale of the Units or the
consummation by the Partnership of the transactions contemplated by
this Agreement and the Operating Partnership with respect to Section 8
hereof, except the registration under the Act of the Units and such
consents, approvals, authorizations, registrations or qualifications
as may be required under state securities or Blue Sky laws or the
by-laws or rules of NASD Regulation, Inc. in connection with the
purchase and distribution of the Units by the Underwriters (it being
understood that the opinion may be limited to those consents,
approvals, authorizations, orders, registrations or qualifications
that, in such counsel's experience, are normally applicable to
transactions of the type contemplated by this Agreement);
(v) The statements set forth in the Prospectus under the caption
"Description of Common Units," insofar as they purport to constitute a
summary of the terms of the Common Units, or under the caption "Tax
Considerations," insofar as they purport to describe the provisions of
the United States federal income tax laws and documents referred to
therein, are accurate and complete in all material respects;
(vi) Neither of the Partnership Entities is (i) an "investment
company," as such term is defined in the Investment Company Act, or
(ii) subject to regulation as a "holding company" or a "subsidiary
company" of a holding company or an "affiliate" thereof, under PUHCA;
(vii) The Units to be issued and sold to the Underwriters by the
Partnership hereunder have been duly and validly authorized by the
Partnership and, when issued and delivered to the Underwriters against
payment therefor in accordance with the terms hereof, will be validly
issued, fully paid and nonassessable (except as nonassessability may
be affected by the legal issues described with respect to holders of
the Common Units in the "Risk Factors" section of the Prospectus under
the captions "Unitholders may not have limited liability in certain
circumstances" and "Unitholders may have liability to repay
distributions"), and free of any statutory preemptive or similar
rights that entitle or will entitle any person to acquire any
partnership interest in the Partnership;
(viii)The Registration Statement has been declared effective
under the Act by the Commission and to the knowledge of such counsel
after due inquiry, no order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose has been instituted or overtly threatened. Any required filing
of the Prospectus relating to the sale of the Units pursuant to Rule
424(b) under the Act has been made in the manner and within the time
period required by such rule;
(ix) The Incorporated Documents (other than the financial
statements and related schedules therein, as to which such counsel
need express no opinion), when they were filed with the Commission
complied as to form in all material respects with the requirements of
the Exchange Act; and
14
(x) The Registration Statement and the Prospectus, as amended
and/or supplemented prior to such Time of Delivery (other than the
financial statements and related schedules therein, as to which such
counsel need express no opinion) comply as to form in all material
respects with the requirements of the Act and the rules and
regulations thereunder.
In addition, such counsel will provide you a letter of negative assurance,
dated such Time of Delivery, in form and substance satisfactory to you, to the
effect that such counsel has participated in conferences with officers and other
representatives of the Partnership, representatives of the independent public
accountants for the Partnership, representatives of the Underwriters and
representatives of counsel for the Underwriters, at which conferences the
contents of the Registration Statement and the Prospectus and related matters
were discussed, and, although such counsel has not independently verified and
are not passing upon and assume no responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement and the
Prospectus (except to the extent specified in subsection (v) of this section
7(c)), no facts have come to their attention that lead them to believe that the
Registration Statement, on the effective date thereof, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading or that the Prospectus, on the date thereof or on the date of such
letter, contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact required to be stated therein or necessary to
make the statements contained therein, in light of the circumstances under which
they were made, not misleading (it being understood that such counsel express no
view with respect to the financial statements and related notes, the financial
statement schedules and the other financial and accounting data included or
incorporated by reference in the Registration Statement or Prospectus);
(d) Xxxxxx X. Xxxxx, General Counsel of the Company, shall have
furnished to you her written opinion, dated such Time of Delivery, in form
and substance satisfactory to you, to the effect that:
(i) The Partnership has an authorized capitalization as set forth
in the Prospectus, and all of the issued and outstanding Common Units
of the Partnership have been duly and validly authorized and issued
and are fully paid and nonassessable (except as nonassessability may
be affected by the legal issues described with respect to holders of
the Common Units in the "Risk Factors" section of the Prospectus under
the captions "Unitholders may not have limited liability in some
circumstances" and "Unitholders may have liability to repay
distributions"); and the Units conform in all material respects to the
description of the Common Units contained in the Prospectus;
(ii) There is no legal or governmental proceeding pending, or, to
such counsel's knowledge, threatened, against either of the
Partnership Entities or its property that is required to be described
in the Prospectus and that has not been so described;
(iii) The Partnership Agreement has been duly authorized,
executed and delivered by the General Partner and is a valid and
legally binding agreement of the General Partner, enforceable against
the General Partner in accordance with its terms; the Operating
Partnership Agreement has been duly authorized, executed and delivered
by each of the General Partner and the Partnership and is a valid and
legally binding agreement of the General Partner and the Partnership,
enforceable
15
against each in accordance with its terms, provided that the
enforceability of each such agreement is subject to the qualifications
that (A) the enforceability of such document may be limited by
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights generally,
(B) the enforceability of such document may be limited by public
policy, applicable law relating to fiduciary duties and the judicial
imposition of an implied covenant of good faith and fair dealing, (C)
the enforceability of equitable rights and remedies provided for in
such document is subject to equitable defenses and judicial
discretion, and the enforceability of such document may be limited by
general equitable principles (regardless of whether enforcement is
sought in a proceeding at law or in equity) and (D) the enforceability
of the indemnity and contribution provisions of such document may be
limited by federal and state securities laws;
(e) 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 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 I hereto (the
executed copy of the letter delivered prior to the execution of this
Agreement is attached as Annex I(a) hereto);
(f) (i) Neither of the Partnership Entities 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 Common
Units, partners' capital or long-term debt of either of the Partnership
Entities or any change, or any development involving a prospective change,
in or affecting the general affairs, management, financial position,
partners' capital or results of operations of either of the Partnership
Entities, otherwise than as set forth or contemplated in the Prospectus,
the effect of which, in any such case described in clause (i) or (ii), is
in the judgment of Xxxxxxx, Xxxxx & Co. so material and adverse as to make
it impracticable or inadvisable to proceed with the public offering or the
delivery of the Units being delivered at such Time of Delivery on the terms
and in the manner contemplated in the Prospectus;
(g) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded the Partnership's debt securities by any "nationally
recognized statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its rating of any of the
Partnership's debt securities (other than as part of a downgrading or
public announcement of surveillance or review, with possible negative
implications, of the industry sector in which the Partnership conducts
business by any such nationally recognized statistical rating
organization);
(h) 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 Exchange; (ii) a suspension or material
limitation in trading in the Partnership's securities on the Exchange;
(iii) a general moratorium on commercial banking activities declared by
either Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the
United States; (iv) the outbreak or escalation of hostilities involving
16
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 Xxxxxxx, Sachs & Co. makes it impracticable
or inadvisable to proceed with the public offering or the delivery of the
Units being delivered at such Time of Delivery on the terms and in the
manner contemplated in the Prospectus;
(i) The Units to be sold at such Time of Delivery shall have been duly
listed, subject to notice of issuance, on the Exchange;
(j) The Partnership has obtained and delivered to the Underwriters
executed copies of an agreement from each of the officers of the
Partnership and members of the Board of Supervisors of the Partnership,
substantially to the effect set forth in Subsection 5(e) hereof in form and
substance satisfactory to you; provided, however, that such agreement shall
provide that the Partnership's officers may collectively sell or dispose of
up to an aggregate of 35,000 Common Units solely for the purposes set forth
in such agreement;
(k) The Partnership shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement; and
(l) The Partnership shall have furnished or caused to be furnished to
you at such Time of Delivery certificates of officers of the General
Partner or the Partnership satisfactory to you as to the accuracy of the
representations and warranties of the Partnership herein at and as of such
Time of Delivery, as to the performance by the Partnership Entities of all
of their obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (f) of this
Section and as to such other matters as you may reasonably request.
8. (a) Each of the Partnership Entities, jointly and severally, 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 any
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, 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; provided, however, that neither
of the Partnership Entities shall 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 any 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 Partnership by any Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless each of the
Partnership Entities against any losses, claims, damages or liabilities to which
either of the Partnership Entities 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 any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the
17
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 any
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 Partnership by such Underwriter through Xxxxxxx,
Sachs & Co. expressly for use therein; and will reimburse each of the
Partnership Entities for any legal or other expenses reasonably incurred by
either 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 the indemnifying
party under such subsection, notify the 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
otherwise than under such subsection. 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 (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 Partnership Entities on the one hand and the Underwriters on the other
from the offering of the Units. 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 Partnership Entities
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 Partnership
Entities 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 (before
deducting expenses) received by the Partnership Entities 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, whether the
untrue or alleged untrue statement of a material fact or
18
the omission or alleged omission to state a material fact relates to information
supplied by the Partnership Entities 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. The Partnership
Entities 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),
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Units underwritten by it and
distributed to the public 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. 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 under
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Partnership Entities under this Section 8 shall
be in addition to any liability which the Partnership Entities 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 the General Partner, to each officer and
member of the Board of Supervisors of the Partnership and to each person, if
any, who controls either of the Partnership Entities within the meaning of the
Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Units 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 Units 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 Units,
then the Partnership shall be entitled to a further period of thirty-six hours
within which to procure another party or other parties satisfactory to you to
purchase such Units on such terms. In the event that, within the respective
prescribed periods, you notify the Partnership that you have so arranged for the
purchase of such Units, or the Partnership notifies you that it has so arranged
for the purchase of such Units, you or the Partnership 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 Partnership 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 Units.
(b) If, after giving effect to any arrangements for the purchase of the
Units of a defaulting Underwriter or Underwriters by you and the Partnership as
provided in subsection (a) above, the aggregate number of such Units which
remains unpurchased does not exceed one-eleventh of the aggregate number of all
the Units to be purchased at such Time of Delivery, then the Partnership shall
have the right to require each non-defaulting Underwriter to purchase the number
of units which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each
19
non-defaulting Underwriter to purchase its pro rata share (based on the number
of Units which such Underwriter agreed to purchase hereunder) of the Units 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
Units of a defaulting Underwriter or Underwriters by you and the Partnership as
provided in subsection (a) above, the aggregate number of such Units which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Units to be purchased at such Time of Delivery, or if the Partnership shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Units 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 Partnership to sell the Optional
Units) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Partnership, except for the expenses to be
borne by the Partnership 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 Partnership Entities 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
either Partnership Entity, or any officer, member of the Board of Supervisors or
controlling person of either Partnership Entity, and shall survive delivery of
and payment for the Units.
11. If this Agreement shall be terminated pursuant to Section 9 hereof, the
Partnership 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 Units are
not delivered by or on behalf of the Partnership as provided herein, the
Partnership 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 Units not so delivered, but the Partnership
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.
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 representative at 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Registration Department; and if to the
Partnership shall be delivered or sent by mail to the address of the Partnership
set forth in the Registration Statement, Attention: Secretary; 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
Partnership 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 Partnership Entities and, to the extent provided in
Sections 8 and 10 hereof, the officers and members of the Board of Supervisors
of either Partnership Entity and each person who controls either Partnership
Entity or any Underwriter, and their respective heirs, executors,
20
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
Units 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.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
16. 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.
17. The Partnership 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.
21
If the foregoing is in accordance with your understanding, please sign and
return to us six 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
Partnership. 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
Partnership for examination upon request, but without warranty on your part as
to the authority of the signers thereof.
Very truly yours,
Suburban Propane Partners, L.P.
By: /s/ Xxxxxxx X. Xxxx, Xx.
---------------------------------------------
Name: Xxxxxxx X. Xxxx, Xx.
Title: Senior Vice President,
Corporate Development
Suburban Propane, L.P.
By: /s/ Xxxxxxx X. Xxxx, Xx.
---------------------------------------------
Name: Xxxxxxx X. Xxxx, Xx.
Title: Senior Vice President,
Corporate Development
22
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Wachovia Capital Markets, LLC
Xxxxxxx Xxxxx & Associates, Inc.
By: /s/ Xxxxxxx, Sachs & Co.
-------------------------------------------
(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Underwriters
23
SCHEDULE I
Number of Optional
Units to be
Total Number of Purchased if
Firm Units Maximum Option
Underwriter to be Purchased Exercised
----------- ---------------- ------------------
Xxxxxxx, Sachs & Co............................................... 1,040,000 156,000
Wachovia Securities, LLC.......................................... 1,040,000 156,000
Xxxxxxx Xxxxx & Associates, Inc................................... 520,000 78,000
Total........................................... --------------------- --------------------
2,600,000 390,000
===================== ====================
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