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EXHIBIT 1.1
DRAFT: March 4, 2001
XXXXXX XXXXXX MANAGEMENT, LLC
8,500,000 SHARES
REPRESENTING LIMITED LIABILITY COMPANY INTERESTS
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UNDERWRITING AGREEMENT
Xxxxxxx, Sachs & Co.,
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
Xxxx Xxxxxxxx Incorporated
First Union Securities, Inc.
As representative(s) of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
Xxxxxx Xxxxxx Management, LLC, 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 8,500,000 shares (the "Firm Shares") and, at the
election of the Underwriters, up to 1,275,000 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, Xxxxxx Xxxxxx Energy Partners, L.P., a Delaware
Partnership (the "Partnership"), the Operating Partnerships listed on Schedule
II (the "Operating Partnerships"), Kinder Xxxxxx X.X., Inc., a Delaware
corporation (the "General Partner"), in its individual capacity and in its
capacity as the general partner of the Partnership and each of the Operating
Partnerships, and each of the subsidiary partnerships, limited liability
companies and corporations listed on Schedule II are collectively referred to
herein as the "Xxxxxx Xxxxxx Entities."
Xxxxxx Xxxxxx, Inc., a Kansas corporation ("KMI"), Xxxxxx Xxxxxx
(Delaware), Inc., a Delaware corporation, and those subsidiaries listed on
Schedule III are herein referred to as the "KMI Entities."
1. Each of the Company, the Partnership, the General Partner and, with
respect to information regarding itself and other KMI Entities in the
Registration Statement or provided below,
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Xxxxxx Xxxxxx, Inc. ("KMI") represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement (File No. 333-55866; File No. 333-55868)
(the "Initial Registration Statement"), in respect of, in each case as described
in the Initial Registration Statement, (a) the Shares, on Form S-1 and the
i-units , the obligation of KMI to purchase the Shares, the exchange right
offered by KMI to exchange common units of the Partnership ("Common Units") of
the Partnership for Shares and the Common Units to be issued in such exchange,
on Form S-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 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"; such final
prospectus, in the form first filed pursuant to Rule 424(b) under the Act, are
hereinafter called the "Prospectus"; 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, as of the date of such Preliminary Prospectus or Prospectus, as
the case may be; 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 Company 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
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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 Company by an Underwriter through
Xxxxxxx, Sachs & Co. expressly for use therein;(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 Company by
an Underwriter through Xxxxxxx, Xxxxx & 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 Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein;
(e) None of the Xxxxxx Xxxxxx Entities or the KMI Entities has
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material 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, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any material
change in the capitalization or long-term debt of the Xxxxxx Xxxxxx Entities or
the KMI Entities or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders', interestholders' or unitholders'
equity or results of operations of the Xxxxxx Xxxxxx Entities, taken as a whole,
or the KMI Entities, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(f) Each of the Xxxxxx Xxxxxx Entities and the KMI Entities (in the
case of Xxxxxx Xxxxxx CO2 Company and RCG, to the Company's knowledge) has good
and marketable title (or indefeasible title in the State of Texas) in fee simple
to all real property and good and marketable title to all personal property
owned by them, in each case free and clear of all liens, encumbrances and
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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 the Xxxxxx Xxxxxx
Entities and KMI Entities; and any real property and buildings held under lease
by a Xxxxxx Xxxxxx Entity or KMI Entity (in the case of Xxxxxx Xxxxxx CO2
Company and RCG, to the Company's knowledge) is 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 Xxxxxx Xxxxxx Entities and KMI Entities;
(g) The Company has been duly formed and is validly existing as a
limited liability company in good standing under the laws of Delaware, with
power and authority to own or lease 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 licensed or qualified would not, individually or in the
aggregate, have a material adverse effect on the financial condition, results of
operations or business of the Xxxxxx Xxxxxx Entities, taken as a whole, or the
KMI Entities, taken as a whole, or subject the Partnership or its partners to
any material liability or disability (a "Material Adverse Effect"). 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 contemplated herein. The General Partner is the Company's sole
member, and owns all issued and outstanding equity securities of the Company
other than the Shares to be issued as contemplated herein are owned by the
General Partner. Complete and correct copies of the Certificate of Formation and
the Limited Liability Company Agreement of the Company have been delivered to
the Underwriters;
(h) Each of the Company, the Partnership and KMI has an authorized
capitalization as set forth in the Prospectus, and all of the issued equity
securities of the Company and the Partnership have been duly and validly
authorized and issued and are fully paid and (except as required to the contrary
by the Delaware Limited Liability Company Act (the "Delaware LLC Act") or the
Delaware Revised Uniform Limited Partnership Act (the "Delaware LP Act" )
non-assessable and substantially conform to the descriptions thereof in the
Prospectus;
(i) The Partnership has been duly formed and is validly existing as a
limited partnership in good standing under the laws of Delaware, with 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 partnership 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 licensed or
qualified would not have a Material Adverse Effect). Complete and correct copies
of the Certificate of Limited Partnership of the Partnership, and all amendments
thereto, and of the Agreement of Limited Partnership of the Partnership, as
amended and restated (the "Partnership Agreement"), have been delivered to the
Underwriters;
(j) KMI has been duly incorporated and is validly existing as a
corporation in good standing under the laws of Kansas, with 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
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owns or leases properties or conducts any business so as to require such
qualification (except where the failure to be so licensed or qualified would not
have a Material Adverse Effect). KMI owns, directly or indirectly, 11,312,000
Common Units and 2,656,700 class B units of the Partnership ("Class B Units")
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). KMI wholly owns Xxxxxx Xxxxxx (Delaware),
Inc., which wholly owns the General Partner. Such Common Units, Class B Units
and shares of stock in Xxxxxx Xxxxxx (Delaware), Inc. and the General Partner
have been duly and validly authorized and issued and are fully paid and (except
(i) as required to the contrary by the Delaware LP Act), non-assessable.
Complete and correct copies of the Certificate of Incorporation of KMI and
Xxxxxx Xxxxxx (Delaware), Inc., and all amendments thereto, and of the By-Laws
of KMI and Xxxxxx Xxxxxx (Delaware), Inc., as amended, have been delivered to
the Underwriters;
(k) The General Partner has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Delaware, with
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 licensed or
qualified would not have a Material Adverse Effect). The General Partner owns
all equity securities of the Company and such equity securities have been duly
and validly authorized and issued and are fully paid and (except (i) as required
to the contrary by the Delaware LLC Act), non-assessable. Except as described in
the Prospectus, the General Partner has 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;
(l) The General Partner is the sole general partner of the Partnership
and each of the Operating Partnerships; such general partner interests are duly
authorized by the Partnership Agreement and the Agreements of Limited
Partnership of the respective Operating Partnerships, as the case may be, and
were validly issued to the General Partner; and the General Partner owns each
such general partner interest free and clear of all liens, encumbrances,
security interests, equities or charges (except for such liens, encumbrances,
security interests, equities or charges as are not, individually or in the
aggregate, material to such ownership or as described in the Prospectus);
(m) The only meaningful and active subsidiaries (as such term is
defined in the rules and regulations of the Commission under the Act and the
Exchange Act) of the Partnership or other entities in which the Partnership, the
General Partner, any of the Operating Partnerships or SFPP, L.P. has an equity
ownership interest of 50% or more and that own assets or conduct business are
those listed on Schedule II hereto (the "Partnership Subsidiaries"). The only
meaningful and active subsidiaries (as such term is defined in the rules and
regulations of the Commission under the Act) of KMI or other entities in which
KMI has an equity ownership interest of 50% or more and that own assets or
conduct business are those listed on Schedule III hereto (the "KMI
Subsidiaries"). All of the outstanding shares of capital stock, limited partner
interests, general partner interests or limited liability company interests of
each of the Partnership Subsidiaries and KMI Subsidiaries have been duly and
validly authorized and issued and are fully paid and (except (i) as required to
the contrary by the Delaware LLC Act and the Delaware LP Act and (ii) with
respect to any general
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partner interests) non-assessable, and are owned by the Partnership or KMI, as
applicable, directly or indirectly through one or more wholly-owned
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)
(n) Each of the Partnership Subsidiaries and the KMI Subsidiaries has
been duly formed or incorporated and is validly existing as a corporation,
limited partnership, general partnership or limited liability company, as the
case may be, in good standing under the laws of the jurisdiction in which it is
chartered or organized, with full entity power and authority to own or lease, as
the case may be, and to operate its properties and conduct its business as
described in the Prospectus, and is duly qualified to do business as a
corporation, limited partnership, general partnership or limited liability
company, as the case may be, and is in good standing under the laws of each
jurisdiction which requires such qualification, other than any jurisdiction
where the failure to be so qualified would not, individually or in the
aggregate, have a Material Adverse Effect;
(o) The Shares and i-units have been duly and validly authorized and,
when issued and delivered against payment therefor as provided herein (or in the
case of the i-units in the Prospectus), will be duly and validly issued and
fully paid and (except as non-assessability may be affected by the Delaware LLC
Act) non-assessable and will substantially conform to the descriptions thereof
contained in the Prospectus;
(p) The issue and sale of the Shares by the Company, the execution of,
and the compliance by the Company, the General Partner, the Partnership and KMI
(as applicable) with all of the applicable provisions of, this Agreement, the
Purchase Agreement, the Exchange Agreement, the Partnership Registration Rights
Agreement, the KMI Registration Rights Agreement, the Tax Indemnity Agreement,
the Management Agreement, the Amended and Restated Agreement of Limited
Partnership of the Partnership, the Amended and Restated Agreements of Limited
Partnership of the Operating Partnerships and the Company's Limited Liability
Company Agreement, (all as described in the Prospectus) and the consummation of
the transactions contemplated herein, therein and in the Prospectus 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 any of the
Xxxxxx Xxxxxx Entities or KMI Entities is a party or by which any of the Xxxxxx
Xxxxxx Entities or KMI Entities is bound or to which any of the property or
assets of any of the Xxxxxx Xxxxxx Entities or KMI Entities is subject, except
where any such foregoing occurrence in this paragraph will not prevent the
consummation of the transactions contemplated herein or in the Prospectus and
would not have a Material Adverse Effect; nor will such action result in any
violation of the provisions of any of the formation or incorporation, as
applicable, or governing documents of any of the Xxxxxx Xxxxxx Entities or KMI
Entities or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over any of the Xxxxxx Xxxxxx
Entities or KMI Entities or any of the properties of such entities; 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 Shares or the consummation of the transactions contemplated by this
Agreement or the Prospectus, except 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 securities or
Blue Sky laws in connection with the purchase and distribution of the Shares by
the Underwriters;
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(q) None of the Xxxxxx Xxxxxx Entities or KMI Entities (in the case of
Xxxxxx Xxxxxx CO2 Company, L.P., to the Company's knowledge) is (a) in violation
of its formation or incorporation, as applicable, or 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 have a Material Adverse Effect;
(r) The statements set forth in the Prospectus under the captions
"Description of the Shares," "Description of the i-units" "Description of the
Common Units" and "Xxxxxx Xxxxxx Energy Partners, L.P.'s Distribution Policy,"
insofar as they purport to constitute a summary of the terms of the Shares,
i-units and Common Units, and under the captions "Limited Liability Company
Agreement," "Federal Income Tax Considerations Relating to Our Shares and the
Xxxxxx Xxxxxx Energy Partners Common Units" and" "Underwriting," insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair in all material respects;
(s) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which any of the Xxxxxx Xxxxxx Entities or
KMI Entities is a party or of which any property of the Xxxxxx Xxxxxx Entities
or KMI Entities is the subject which, if determined adversely to such Xxxxxx
Xxxxxx Entity or KMI Entity, would individually or in the aggregate have a
Material Adverse Effect; and, to the Company's and KMI's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(t) Each of the Company, the Partnership, the General Partner, Xxxxxx
Xxxxxx (Delaware), Inc. and KMI is, and after giving effect to the offering and
sale of the Shares and other related transactions contemplated in the
Prospectus, will be, exempt from regulation as (i) a "holding company" or a
"subsidiary company" of a "holding company" thereof within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or (ii) an "investment
company," a person "controlled by" an "investment company" or an "affiliated
person" of or "promoter" or "principal underwriter" for an "investment company,"
as such terms are defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(u) PricewaterhouseCoopers LLP, Xxxxxx Xxxxxxxx LLP and Ernst & Young
LLP, who have certified certain financial statements of the Xxxxxx Xxxxxx
Entities and the KMI Entities, are each independent public accountants as
required by the Act and the rules and regulations of the Commission thereunder.
(v) The financial statements and schedules included or incorporated by
reference in the Registration Statement or the Prospectus present fairly the
consolidated financial condition of the Partnership, KMI, the General Partner,
Xxxxxx Xxxxxx Interstate Gas Transmission LLC, Trailblazer Pipeline Company, RCG
and the GATX Terminals Companies, as of the respective dates thereof and the
consolidated results of operations and cash flows of such entities for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the entire period
involved, except as otherwise disclosed in the Prospectus. 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. The statements
included in the Registration Statement with respect to the Accountants pursuant
to Rule 509 of Regulation S-K of the Rules and Regulations
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are true and correct in all material respects. Any statements made in the
Prospectus or documents incorporated by reference that are covered by Rule
175(b) under the Act were made or will be made with a reasonable basis and in
good faith;
(w) Any summary and selected financial and statistical data included or
incorporated by reference in the Registration Statement or Prospectus present
fairly the information shown therein and, to the extent based upon or derived
from the financial statements, have been compiled on a basis consistent with the
financial statements presented therein except as otherwise stated therein or the
notes thereto. 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, have been prepared on a basis consistent with the historical consolidated
financial statements of the Partnership and KMI (as applicable) and give effect
to the assumptions used in the preparation thereof on a reasonable basis and in
good faith; and the historical financial statements upon which the pro forma
financial statements included in the Registration Statement and the Prospectus
are based present fairly the consolidated results of operations of the
applicable entities for the period covered thereby, all in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the entire period involved .
(x) Each of the Company, the Partnership, the General Partner and KMI
has all of the necessary limited liability company, partnership and corporate
power and authority to enter into this Agreement and consummate the transactions
contemplated hereby. This Agreement has been duly authorized, executed and
delivered by the Company, the Partnership, the General Partner and KMI. The
Partnership has all necessary partnership power and authority to enter into this
Agreement and any Pricing Agreement. This Agreement constitutes a valid and
binding agreement of the Company, the Partnership, the General Partner and KMI
and is enforceable against the Company, the Partnership, the General Partner and
KMI in accordance with the terms hereof, 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;
(y) Each of the Company, the General Partner, the Partnership, and KMI
(as applicable) has all of the necessary limited liability company, partnership
and corporate power and authority to enter into, as applicable, the Purchase
Agreement, the Exchange Agreement, the Partnership Registration Rights
Agreement, the KMI Registration Rights Agreement, the Tax Indemnity Agreement,
the Management Agreement, the Amended and Restated Agreement of Limited
Partnership of the Partnership, the Amended and Restated Agreements of Limited
Partnership of the Operating Partnerships and the Company's Limited Liability
Company Agreement, (all as described in the Prospectus), and consummate the
transactions contemplated thereby. Such Agreements have been duly authorized,
executed and delivered by the Company, the Partnership and KMI (as applicable)
and conform to the descriptions thereof in the Prospectus. Each of such
agreements constitutes a valid and legally binding agreement of the parties
thereto, enforceable against the 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.
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(z) There are no preemptive rights or other rights to subscribe for or
to purchase, nor any restrictions upon the voting or transfer of, any
partnership or membership interests (including the Shares) or shares of stock of
any of the Xxxxxx Xxxxxx Entities pursuant to any partnership or limited
liability company agreement, any articles or certificates of incorporation or
other governing documents or any agreement or other instrument to which any of
the Xxxxxx Xxxxxx Entities is a party or by which any of such entities may be
bound (other than (a) the General Partner's preemptive right contained in the
Partnership Agreement, (b) in the partnership agreements of PPLC, Trailblazer
Pipeline and RCG, and (c) as set forth in or incorporated by reference into the
Prospectus). Neither the offering and sale of Shares, as contemplated by this
Agreement, nor the other related transactions described in the Prospectus, gives
rise to any rights, other than those which have been waived or satisfied, for or
relating to the registration of any securities of the Partnership, the Company
or the General Partner (except as provided in the Partnership Registration
Rights Agreement and the KMI Registration Rights Agreement or as otherwise
described in the Prospectus). There are no other rights entitling any holder of
securities of the Partnership, the Company or the General Partner to register
any of such securities ([other than pursuant to the Registration Rights
Agreement, dated February 1, 2000, among the Partnership and the former
shareholders of Milwaukee Bulk Terminals, Inc.]) Except for certain grants made
under the Partnership's Executive Compensation Plan and the Partnership Common
Unit Option Plan, there are no outstanding options or warrants to purchase any
Shares, Common Units or other securities of any of the Xxxxxx Xxxxxx Entities.
(aa) Each of the Xxxxxx Xxxxxx Entities and KMI Entities maintains
insurance (issued by insurers of recognized financial responsibility) of the
types and in the amounts generally deemed adequate for their respective
businesses and, to the knowledge of the Partnership, consistent with insurance
coverage maintained by similar companies in similar businesses, including, but
not limited to, insurance covering real and personal property owned or leased by
it against theft, damage, destruction, acts of vandalism and all other risks
customarily insured against, all of which insurance is in full force and effect.
(bb) Except as disclosed in the Prospectus, none of the Xxxxxx Xxxxxx
Entities or KMI Entities has violated any federal or state law or regulation
relating to the protection of human health or the environment except for any
violations and remedial actions as would not have a Material Adverse Effect;
(cc) Prior to the date hereof, none of the Xxxxxx Xxxxxx Entities or
KMI Entities has taken any action that is designed to or that has constituted or
that might have been expected to cause or result in stabilization or
manipulation of the price of any security of the Partnership or the Company in
connection with the offering of the Shares;
(dd) None of the Xxxxxx Xxxxxx Entities or KMI Entities is involved in
any labor dispute and, to the knowledge of the Company, no such dispute has been
threatened, except for such disputes as would not have a Material Adverse
Effect;
(ee) None of the Xxxxxx Xxxxxx Entities or KMI Entities is in violation
or default of any statute, law, rule, regulation, judgment, order or decree of
any court, regulatory body, administrative agency, governmental body, arbitrator
or other authority having jurisdiction over such Xxxxxx Xxxxxx Entity or KMI
Entity or any of its properties, as applicable, except where such violation or
default would not, individually or in the aggregate, have a Material Adverse
Effect; and
(ff) [GATX agreement/transaction status
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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 $................, 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 1,275,000 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 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 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) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and 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 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 Shares, 9:30 a.m., New York City time, on ............., 2001 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, 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".
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(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 Shares and any additional documents requested by the
Underwriters pursuant to Section 7(k) hereof, will be delivered at the offices
of Xxxxxx & Xxxxxx, 000 Xxxxx Xxxxxx, 00xx xxxxx, Xxx Xxxx, XX 00000 (the
"Closing Location"), and the Shares will be delivered at the Designated Office,
all at such Time of Delivery. A meeting will be held at the Closing Location at
3:00p.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, "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. Each of the Company, the General Partner, the Partnership and KMI
(except in the case of (d), (f), (g), (h) and (m) 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 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 Common 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 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 Shares, i-units and Common 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 Shares, i-units and Common Units, 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 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
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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 the Company's Shareholders 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 (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);
(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 Common 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 Common Units), not
to, directly or indirectly, offer, sell, contract to sell or otherwise dispose
of, except as provided hereunder, any securities of the Company or the
Partnership that are, or are substantially similar to, Shares, i-units or Common
Units, 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
Common Units or any such substantially similar securities (other than (A) the
sale of i-units by Xxxxxx Xxxxxx Energy Partners to the Company and subsequent
quarterly distributions of i-units and Shares as contemplated by the Prospectus,
(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 Xxxxxx
Xxxxxx, Inc., Xxxxxx Xxxxxx Energy Partners, L.P., or any subsidiary of Xxxxxx
Xxxxxx, Inc. owning Common Units or Class B Units on the date hereof, or any
operating subsidiary of Xxxxxx Xxxxxx Energy Partners, L.P. owning Common Units
or Class B 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, KMI 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 Common Units, or even if such Shares, i-units or Common Units would
be disposed of by someone
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other than the Partnership, the General Partner, KMI 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 Common 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 Common 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, [interest]holders' 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 copies of all reports or other
communications (financial or other) furnished to Shareholders, 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 Company is listed; and (ii)
such additional information concerning the business and financial condition of
the Company 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
Company and its subsidiaries are consolidated in reports furnished to its
Shareholders generally or to the Commission);
(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" (Including the Purchase by the Company of
i-units with the proceeds of the sale of Shares, and the use by the Partnership
of such proceeds to pay down its outstanding indebtedness);
(i) To use its best efforts to [list, subject to notice of issuance,
the Shares on the ................. Stock Exchange (the "Exchange")] [list for
quotation the Shares on the National Association of Securities Dealers Automated
Quotations National Market System ("NASDAQ")];
(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; and
(k) If the Company, the Partnership or KMI elects to rely upon Rule
462(b), the Company, the Partnership and KMI 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
Company, the Partnership and KMI 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.
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(m) To maintain the effectiveness of a registration statement for a
continuous offering of Common Units to be delivered by the Partnership upon the
exchange of Shares (subject to the terms of the Partnership Registration Rights
Agreement).
(n) [To maintain the effectiveness of a registration statement for
the Shares to be received by KMI in the exchange listed in (m) immediately above
(subject to the terms of the KMI Registration Rights Agreement).]
(o) KMI shall establish and maintain at all times a reserve of
Common Units in an amount that is enough to effect the exchange of at least 20%
of all Shares outstanding (not including any owned by KMI).
(p) The Partnership shall duly authorize and issue i-units to the
Partnership as contemplated in the Prospectus under "Use of Proceeds."
(q) To effect and maintain the delegation of the control and
management of the business and affairs of the Partnership from the General
Partner to the Company and all other related covenants listed in the Prospectus;
and
(r) To authorize, execute and deliver each of the Purchase
Agreement, the Exchange Agreement, the Partnership Registration Rights
Agreement, the KMI Registration Rights Agreement, the Tax Indemnity Agreement,
the Management Agreement, the Amended and Restated Agreement of Limited
Partnership of the Partnership, the Amended and Restated Agreements of Limited
Partnership of the Operating Partnerships and the Company's Limited Liability
Company Agreement, (all as described in the Prospectus).
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration described in Section 1(a) 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, the Blue Sky Memorandum,
closing documents (including any compilations thereof) and any other documents
in connection with the offering, purchase, sale and delivery of the Shares,
i-units , or Common Units; (iii) all expenses in connection with the
qualification of the Shares, i-units , or Common Units for offering and sale
under state securities laws as provided in Section 5(b) hereof, but not
including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky and legal
investment memoranda (iv) all fees and expenses in connection with listing the
Shares on the [....... STOCK Exchange][NASDAQ]; the filing fees incident to
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of the sale of the Shares; (v) the cost of preparing
certificates representing the Shares, i-units or Common Units; (vi) the cost and
charges of any transfer agent or registrar; and (vii) all other costs and
expenses incident to the performance of its 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
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counsel, stock transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
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 KMI 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 KMI 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 Company, the Partnership or KMI 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 & Xxxxxx 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, as amended or
supplemented), (vii), (xi) (insofar as it relates to the statements set forth in
the Prospectus under the caption "Underwriting" and (xvi) (insofar as it relates
to the Registration Statement and the Prospectus) of subsection (c) below and a
letter substantially similar to the letter required to be delivered by Xxxxxxxxx
& Xxxxxxxxx, L.L.P. pursuant to 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) Xxxxxxxxx & Xxxxxxxxx, L.L.P., counsel for the Company, the
Partnership, the General Partner and KMI, 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 Company, the Partnership, the General Partner,
Xxxxxx Xxxxxx (Delaware), Inc., KMI and those subsidiaries listed on Schedule IV
(collectively, the "Subsidiaries") has been duly formed or incorporated, as the
case may be, and is validly existing and in good standing under the laws of its
jurisdiction of formation or incorporation, as applicable, and each such entity
has the partnership, limited liability company or corporate power and authority
to conduct its business as described in the Prospectus, as amended or
supplemented;
(ii) At such Time of Delivery after giving effect to the
issuance of the Firm Shares, to the knowledge of such counsel after due inquiry,
the capitalization of the Company will consist of [ ] Shares ([ ] Shares if all
of the Optional Shares are issued) and [ ] membership interests owned by the
General Partner and the capitalization of the Partnership will consist of [ ]
Common Units, [ ] of which are owned by KMI, [ ] Class B units [ ] of which are
owned by KMI, and [ ] i-units, owned by the Company; to the knowledge of
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such counsel, after due inquiry, such securities will be the only equity
securities that are issued and outstanding of such entities at such Time of
Delivery; all of such securities have been duly and validly authorized and
issued and are fully paid and nonassessable (except as such non-assessability
may be affected by certain provisions of the Delaware LLC Act and Delaware LP
Act), and the Shares, the i-units and the Common Units conform in all material
respects to the descriptions thereof contained or incorporated by reference in
the Prospectus, as amended or supplemented;
(iii) To the knowledge of such counsel after due inquiry, each
of the entities listed in (i) is duly qualified to do business and is in good
standing as a foreign corporation, foreign limited partnership or foreign
limited liability company, as applicable, in all jurisdictions in which the
nature of the activities conducted by it or the character of the assets owned or
leased by it makes such licensing or qualification necessary, except in the case
where the failure to be so qualified would not reasonably be expected to have a
Material Adverse Effect;
(iv) All of the outstanding shares, limited liability company
interests, limited partner interests and general partner interests of each of
the General Partner, Xxxxxx Xxxxxx (Delaware), Inc. and the Subsidiaries have
been duly and validly authorized and issued and (either at the Time of Delivery
will be, or) are fully paid and (except (i) as required to the contrary by the
Delaware LP Act or Delaware LLC Act and (ii) with respect to any general partner
interests) nonassessable, and, except as otherwise set forth in the Prospectus
are owned by the Partnership or KMI, directly or indirectly through one or more
wholly-owned 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 none
of such outstanding shares of stock, limited liability company interests or
partnership interests were issued in violation of any preemptive or similar
rights of any holder of any security or other interest of such entities;
(v) The General Partner is the sole general partner of the
Partnership and each of the Operating Partnerships; such general partner
interests are duly authorized by the Partnership Agreement and the Agreements of
Limited Partnership of the respective Operating Partnerships, as the case may
be, and were validly issued to the General Partner; and the General Partner owns
each such general partner interest free and clear of all liens, encumbrances,
security interests, equities or charges (except for such liens, encumbrances,
security interests, equities or charges as are not, individually or in the
aggregate, material to such ownership or as described in the Prospectus or as
described in the Registration Statement or the Prospectus, as amended or
supplemented and except as provided in the Operating Partnership Agreements);
(vi) To such counsel's knowledge after due inquiry and other
than as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which any of the Company, the Partnership, the General
Partner, Xxxxxx Xxxxxx (Delaware), Inc., KMI or the Subsidiaries is a party or
of which any property of such entities is the subject which, if determined
adversely to such entities, would individually or in the aggregate, reasonably
be expected to have a material adverse effect on the current or future
consolidated financial position; stockholders; interestholders' or unitholders'
equity or results of operations of the Xxxxxx Xxxxxx Entities or KMI Entities,
except such counsel need not express an opinion with
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respect to Xxxxxx Xxxxxx CO2 Company, L.P., and, to such counsel's knowledge
after due inquiry, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(vii) This Agreement has been duly authorized, executed and
delivered by the Company, the Partnership the General Partner and KMI;
(viii) Each of the Purchase Agreement, the Exchange Agreement,
the Partnership Registration Rights Agreement, the KMI Registration Rights
Agreement, the Tax Indemnity Agreement, the Management Agreement, the Amended
and Restated Agreement of Limited Partnership of the Partnership, the Amended
and Restated Agreements of Limited Partnership of the Operating Partnerships and
the Company's Limited Liability Company Agreement, (all as described in the
Prospectus) has been duly authorized, executed and delivered by the Company, the
Partnership, the General Partner and KMI (as applicable). Each of such
agreements constitutes a valid and legally binding agreement of the parties
thereto, enforceable against the 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. Each of the Company, the Partnership, the General Partner, and
KMI has all necessary entity power and authority to consummate the transactions
contemplated thereby and hereby;
(ix) The issue and sale of the Shares by the Company, the issue
and sale of the i-units by the Partnership to the Company, the execution of, and
the compliance by the Company, the General Partner, the Partnership and KMI with
all of the applicable provisions of, this Agreement, the Purchase Agreement, the
Exchange Agreement, the Partnership Registration Rights Agreement, the KMI
Registration Rights Agreement, the Tax Indemnity Agreement, the Management
Agreement, the Amended and Restated Agreement of Limited Partnership of the
Partnership, the Amended and Restated Agreements of Limited Partnership of the
Operating Partnerships and the Company's Limited Liability Company Agreement,
(all as described in the Prospectus), and the consummation of the transactions
contemplated herein and in the Prospectus (including the Section entitled "Use
of Proceeds") will not (A) 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 filed
or incorporated by reference as an exhibit to the Partnership's 2000 Form 10-K
or KMI's 2000 Form 10-K; (B) result in any violation of the provisions of any of
the formation or incorporation, as applicable, or governing documents of any of
the Company, the Partnership, the General Partner, Xxxxxx Xxxxxx (Delaware),
Inc., KMI or the Subsidiaries, except such counsel need not express an opinion
with respect to Xxxxxx Xxxxxx CO2 Company, L.P., or (C) breach or otherwise
violate an existing obligation of any of the Company, the Partnership, the
General Partner, Xxxxxx Xxxxxx (Delaware), Inc., KMI or the Subsidiaries, except
such counsel need not express an opinion with respect to Xxxxxx Xxxxxx CO2
Company, L.P., under any existing court or administrative order, judgment or
decree of which such counsel has knowledge after due inquiry or (D) violate any
applicable provisions of the federal laws of the United States (including the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 0000 (xxx "XXX Xxx"), the laws
of the State of Texas, the Delaware General Corporation Law (the "DGCL"), the
Delaware LLC Act or the Delaware LP Act;
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(x) No consent, approval, authorization, order, registration,
filing or qualification of or with any federal, Delaware or Texas court or
governmental agency or body is required under federal (including the HSR Act) or
Texas law, the DGCL, the Delaware LLC Act or the Delaware LP Act for the issue
and sale of the Shares being delivered at such Time of Delivery, the issue and
sale of the i-units by the Partnership to the Company or the consummation by the
Company, the Partnership or KMI of the transactions contemplated by this
Agreement, the Purchase Agreement, the Exchange Agreement, the Partnership
Registration Rights Agreement, the KMI Registration Rights Agreement, the Tax
Indemnity Agreement, the Management Agreement, the Amended and Restated
Agreement of Limited Partnership of the Partnership, the Amended and Restated
Agreements of Limited Partnership of the Operating Partnerships and the
Company's Limited Liability Company Agreement, (all as described in the
Prospectus), except (a) such as have been obtained under the Act, (b) such
consents, approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws or by the By-laws and rules of
the NASD in connection with the purchase and distribution of the Shares by the
Underwriters and (c) such as the failure to obtain or make would not be
reasonable expected, individually or in the aggregate, to have a material
adverse effect on the current or future consolidated position, stockholders',
unitholders' or interestholders' equity or results of operations of the Xxxxxx
Xxxxxx Entities or KMI Entities;
(xi) The Registration Statement was 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 is pending, threatened
or contemplated. Any required filing of the Prospectus relating to the sale of
the Shares pursuant to Rule 424(b) under the Act has been made in the manner and
within the time period required by such rule;
(xii) The statements set forth in the Prospectus under the
captions "Description of the Shares," "Description of the i-units," "Description
of the Common Units" and "Xxxxxx Xxxxxx Energy Partners, L.P.'s Distribution
Policy," insofar as they purport to constitute a summary of the terms of the
Shares, i-units and Common Units, and under the captions "Limited Liability
Company Agreement," "Federal Income Tax Considerations Relating to Our Shares
and the Xxxxxx Xxxxxx Energy Partners Common Units" and "Underwriting," insofar
as they purport to describe the provisions of federal law, Texas law, the DGCL,
the Delaware LLC Act or the Delaware LP Act and documents referred to therein,
are accurate, complete and fair in all material respects;
(xiii) Each of the Company, the Partnership, KMI, Xxxxxx Xxxxxx
(Delaware), Inc. and the General Partner is exempt from regulation as a (a)
"holding company" or a "subsidiary company" of a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended;
(xiv) The Shares have been approved for listing [, subject to
notice of issuance, on the Exchange] [for quotation on NASDAQ];
(xv) To the knowledge of such counsel after due inquiry, except
as disclosed in the Registration Statement or the Prospectus, as amended or
supplemented, no person or entity has the right to require the registration
under the Act of Shares, i-units or Common Units
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or other securities of the Company or the Partnership by reason of the filing or
effectiveness of the Registration Statement, which has not been waived;
(xvi) None of the Shares, i-units or Common Units registered by
the Registration Statement will be subject to any preemptive or similar right
under (i) the Delaware LLC Act, the Delaware LP Act or the DGCL, (ii) the
Partnership Agreement (except for the General Partner's preemptive right
contained in Section 4.5 of the Partnership Agreement, which has been waived
with respect to the transactions contemplated by the Prospectus) or (iii) any
instrument, document, contract or agreement filed as an exhibit to or
incorporated by reference in the Registration Statement. Except as (i) described
in the Registration Statement or the Prospectus, (ii) the Partnership's
Executive Compensation Plan, and (iii) the Partnership's Common Unit Option
Plan, to the knowledge of such counsel after due inquiry, there is no commitment
or arrangement to issue, and there are no outstanding options, warrants or other
rights calling for the issuance of, any Shares, i-units or Common Units or any
partnership or membership interest or share of capital stock of any of the
Xxxxxx Xxxxxx Entities or KMI Entities to any person or any security or other
instrument that by its terms is convertible into, exercisable for and
exchangeable into Shares, i-units or Common Units. To the knowledge of such
counsel after due inquiry, there are no rights entitling any holder of Shares,
i-units, or Common Units to cause the Company or the Partnership to register any
of such interests (other than pursuant to (x) this Agreement, (y) the
Registration Rights Agreement, dated February 1, 2000, among the Partnership and
the former shareholders of Milwaukee Bulk Terminals, Inc. and (z) the
Partnership Registration Rights Agreement and the KMI Registration Rights
Agreement.).
(xvii) Upon delivery of the certificates evidencing the Shares
against payment therefor as provided in this Agreement, the Underwriters will
acquire the Shares free of all adverse claims (as such term is defined in
Section 8-302 of the Uniform Commercial Code as in effect in the State of
Delaware (the "UCC"), assuming (i) the Underwriters are acting in good faith,
(ii) the Underwriters have no notice of any adverse claim (as such term is used
in Section 8-302 of the UCC) and (iii) the certificates evidencing the Shares
are registered in the names of the Underwriters or endorsed to the Underwriters
or nominees of the Underwriters;
(xviii) The Registration Statement and the Prospectus (including
any documents incorporated by reference in the Prospectus, when such documents
became effective or were filed with the Commission), as amended or supplemented,
appear on their face to comply as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder (other than the financial statements
and related schedules and other financial data contained therein, as to which
such counsel need express no opinion).
Such counsel shall also deliver a letter to the effect that they have
participated in conferences with officers and other representatives of the
Company, the Partnership, and KMI, representatives of such entities'
accountants, representatives of the Underwriters and counsel for the
Underwriters, at which conferences the contents of the Registration Statement
and Prospectus and related matters were discussed and, based upon such
participation and review, and relying as to materiality in part upon the factual
statements of the officers and other representatives of the Company, the
Partnership, KMI and others, no facts have come to such counsel's attention that
have caused them to believe that, as of its effective date, the
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Registration Statement or any further amendment thereto made by the Company, the
Partnership or KMI prior to such Time of Delivery (other than the financial
statements and related schedules and other financial data contained therein, as
to which such counsel need not comment) contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; or that, as of its
date, the Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Company, the Partnership or KMI prior to such
Time of Delivery (other than the financial statements and related schedules and
other financial data contained therein, as to which such counsel need not
comment) contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; or that, as of such
Time of Delivery, either the Registration Statement or the Prospectus as amended
or supplemented or any further amendment or supplement thereto made by the
Partnership, the Company or KMI prior to such Time of Delivery (other than the
financial statements and related schedules and other financial data contained
therein, as to which such counsel need express no opinion) contains an untrue
statement of a material fact or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; and such counsel have no reason to believe that the
documents incorporated by reference in the Prospectus, as amended or
supplemented or any further amendment or supplement thereto made by the
Partnership, the Company or KMI prior to such Time of Delivery (other than the
financial statements and related schedules and other financial data contained
therein and the exhibits thereto, as to which such counsel need express no
opinion) or any subsequent documents incorporated by reference in the
Prospectus, when such documents became effective or were so filed, as the case
may be, contained, in the case of a registration statement which became
effective under the Act, an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or, in the case of other documents which were
filed under the Exchange Act with the Commission (other than the financial
statements and related schedules and other financial data contained therein and
the exhibits thereto, as to which such counsel need express no opinion), an
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so filed, not
misleading; and they do not know of any contracts or other documents of a
character required to be filed as an exhibit to the Registration Statement or
required to be incorporated by reference into the Prospectus as amended or
supplemented or required to be described in the Registration Statement or the
Prospectus as amended or supplemented which are not filed or incorporated by
reference or described as required.
Such letter may state that, because the primary purpose of such
counsel's engagement was not to establish or confirm factual matters or
financial matters and because of the wholly or partially non-legal character of
many of the statements contained in the Registration Statement and the
Prospectus, such counsel is not passing upon and does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus (except to the extent
expressly set forth in paragraph (xi) of this Section 7(c)), and they have not
independently verified the accuracy, completeness or fairness of such statements
(except as aforesaid); and that,
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without limiting the foregoing, they assume no responsibility for, have not
independently verified and have not been asked to comment on the accuracy,
completeness or fairness of the financial statements and related schedules
included in the Registration Statement and the Prospectus, and they have not
examined the financial or other records from which such financial statements and
related schedules and other financial data contained therein were derived.
In rendering such opinion such counsel may state that they express no
opinion as to the laws of any jurisdiction other than federal law, Texas law,
[the Colorado Limited Liability Company Act], [the Kansas General Corporation
Law], the DGCL, the Delaware LLC Act and the Delaware LP Act.
(d) 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, Xxxxxx Xxxxxxxx LLP and Ernst & Young 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;
(e) Shearman & Sterling, special counsel for the Company, the
Partnership and the General Partner, shall have furnished to you their written
opinion, dated such Time of Delivery, in form and substance satisfactory to you,
to the effect that each of the Company, the Partnership, and the General Partner
is exempt from registration as an "investment company" or an entity "controlled
by" an "investment company," as such terms are defined in the Investment Company
Act of 1940, as amended.
(f) (i) None of the Xxxxxx Xxxxxx Entities or the KMI 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 partners' capital or
capital stock, as applicable, or long-term debt of the any of the Xxxxxx Xxxxxx
Entities or the KMI Entities 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 Xxxxxx Xxxxxx Entities or the KMI 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 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;
(g) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Xxxxxx Xxxxxx Entities' or KMI Entities'
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 Xxxxxx Xxxxxx Entities' or KMI Entities'
debt securities or preferred stock;
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(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 New York Stock Exchange [or on NASDAQ]; (ii) a suspension or
material limitation in trading in the Company's securities on [ ] or the
Partnership's or KMI's securities on the NYSE; (iii) a general moratorium on
commercial banking activities declared by either Federal or New York or Texas
State authorities; or (iv) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war, if the effect of any such event specified in this clause (iv)
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;
(i) The Shares to be sold at such Time of Delivery shall have been
duly listed [, subject to notice of issuance, on the Exchange] [for quotation on
NASDAQ];
(j) The Company has obtained and delivered to the Underwriters
executed copies of an agreement from [Xxx X. Xxxx], each executive officer,
director or 5% equity holder of the Company and the Partnership, other than the
General Partner and KMI, substantially to the effect set forth in Subsection
5(e) hereof in form and substance satisfactory to you;
(k) The Company, the Partnership and KMI 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 Company, the General Partner the Partnership and KMI 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 KMI satisfactory to you as to the accuracy of the representations and
warranties of the Company the Partnership, the General Partner and KMI herein at
and as of such Time of Delivery, as to the performance by each of the Company
the Partnership, the General Partner and KMI of all of its 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.
(m) The following documents shall have been duly authorized,
executed and delivered and be in full force and effect: the Purchase Agreement,
the Exchange Agreement, the Partnership Registration Rights Agreement, the KMI
Registration Rights Agreement, the Tax Indemnity Agreement, the Management
Agreement, the Amended and Restated Agreement of Limited Partnership of the
Partnership, the Amended and Restated Agreements of Limited Partnership of the
Operating Partnerships and the Company's Limited Liability Company Agreement,
(all as described in the Prospectus).
(n) The successful delegation of the General Partner's control and
management of the business and affairs of the Partnership shall have occurred.
(o) [Consummation of the GATX transaction; CUPC order].
8. (a) Each of the Company, the Partnership and, with respect to
information regarding itself, KMI, 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
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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 the
Company, the Partnership and KMI 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 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 Company by any Underwriter
through Xxxxxxx, Xxxxx & Co. expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company,
the Partnership and KMI against any losses, claims, damages or liabilities to
which the Company the Partnership and KMI 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, 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 Company by such
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein; and will
reimburse the Company for any legal or other expenses reasonably incurred by the
Company 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
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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 Company, the Partnership and KMI 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 and KMI 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 and KMI 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 Company 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 the omission or alleged omission to state a material fact
relates to information supplied by the Company, the Partnership or KMI 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 Company, the Partnership, KMI 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 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. 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.
(e) The obligations of the Company, the Partnership and KMI under
this Section 8 shall be in addition to any liability which the Company, the
Partnership or KMI may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any
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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 and KMI (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 and KMI) and to each person, if any, who controls the Company, the
Partnership or KMI 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(5),
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
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 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.
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10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Partnership, the General Partner and
KMI 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 KMI or any officer or director or controlling person of the Company the
Partnership, the General Partner or KMI, 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 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 Xxx Xxxx, 00xx Xxxxx, 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:
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 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 KMI and, to the extent provided in Sections 8 and 10 hereof, the officers
and directors of the Company, the Partnership, the General Partner and KMI and
each person who controls the Company, the Partnership, the General Partner and
KMI 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.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
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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 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, without the Underwriters imposing any limitation of any kind.
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.
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.
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Very truly yours,
Xxxxxx Xxxxxx Management, LLC
By: Kinder Xxxxxx XX, Inc., its Manager and
sole Member
By:
----------------------------------------
Name:
Title:
Xxxxxx Xxxxxx Energy Partners, LP
By: Kinder Xxxxxx XX, Inc., its General
Partner
By:
----------------------------------------
Name:
Title:
Kinder Xxxxxx XX, Inc.
By:
----------------------------------------
Name:
Title:
Xxxxxx Xxxxxx, Inc.
By:
----------------------------------------
Name:
Title:
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Accepted as of the date hereof:
[XXXXXXX, XXXXX & CO.
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXX BROTHERS INC.
XXXX XXXXXXXX INCORPORATED
FIRST UNION SECURITIES, INC.
BY:
--------------------------------
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Underwriters
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SCHEDULE I
[NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
[FIRM(5)] SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- ---------------- -------------------
Xxxxxxx, Xxxxx & Co. ............................
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
Xxxx Xxxxxxxx Incorporated
First Union Securities, Inc. ....................
[NAMES OF OTHER UNDERWRITERS]....................
---------------- -------------------
Total........................ (5)]
================ ===================
30
31
SCHEDULE II
Partnership Subsidiaries
[Xxxxxx Xxxxxx Operating L.P. "A," a Delaware limited partnership ("OLP-A"),
Xxxxxx Xxxxxx Operating L.P. "B," a Delaware limited partnership ("OLP-B"),
Xxxxxx Xxxxxx Operating L.P. "C," a Delaware limited partnership ("OLP-C"),
Xxxxxx Xxxxxx Operating L.P. "D," a Delaware limited partnership ("OLP-D" and,
together with OLP-A, OLP-B and OLP-C, the "Operating Partnerships"),
SFPP, L.P., a Delaware limited partnership ("SFPP"),
Xxxxxx Xxxxxx Bulk Terminals, Inc., a Louisiana corporation ("XXXX"),
Xxxxxx Xxxxxx CO2 Company, L.P., a Texas limited partnership ("KMCO2"),
CO2 Liquidating, LLC, a Delaware limited liability company,
Plantation Pipe Line Company, a Delaware and Virginia corporation ("PPLC"),
Xxxxxx Xxxxxx Interstate Gas Transmission LLC, a Colorado single-member limited
liability company ("KMIG"),
Xxxxxx Xxxxxx Trailblazer LLC, a Delaware single-member limited liability
company,
CGT Trailblazer, L.L.C., a Delaware single-member limited liability company,
Trailblazer Pipeline Company, an Illinois general partnership,
Red Cedar Gathering Company, a Colorado general partnership ("RCG"),
Dakota Bulk Terminal, Inc., a Wisconsin corporation,
Heartland Pipeline Company, a Texas [corporation][general partnership],
[River Consulting, Inc., a Louisiana corporation],
Milwaukee Bulk Terminals, Inc., a Wisconsin corporation,
[Western Plant Services, Inc., a California corporation,]
Delta Terminal Services, Inc., a Delaware corporation
Queen City Terminals, Inc., a Delaware corporation
Xxxxxx Xxxxxx Canada Company, a Nova Scotia unlimited liability company
Xxxxxx Xxxxxx Transmix Company L.L.C., a [ ]
Xxxxxx Xxxxxx Texas Pipeline, L.P., a Delaware limited partnership
[Xxxxxx Xxxxxx Texas Pipeline, Inc], a [ ],
[Coyote Gas Treating LLC], a [ ],
[Shell CO2 Company], a[ ],
[GATX-related entity]
others?]
F-1
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SCHEDULE III
KMI Subsidiaries
F-2
33
SCHEDULE IV
Subsidiaries (for legal opinion)
[Xxxxxx Xxxxxx Operating L.P. "A," a Delaware limited partnership ("OLP-A"),
Xxxxxx Xxxxxx Operating L.P. "B," a Delaware limited partnership ("OLP-B"),
Xxxxxx Xxxxxx Operating L.P. "C," a Delaware limited partnership ("OLP-C"),
Xxxxxx Xxxxxx Operating L.P. "D," a Delaware limited partnership ("OLP-D" and,
together with OLP-A, OLP-B and OLP-C, the "Operating Partnerships"),
SFPP, L.P., a Delaware limited partnership ("SFPP"),
Xxxxxx Xxxxxx Bulk Terminals, Inc., a Louisiana corporation ("XXXX"),
Xxxxxx Xxxxxx CO2 Company, L.P., a Texas limited partnership ("KMCO2"),
Xxxxxx Xxxxxx Interstate Gas Transmission LLC, a Colorado single-member limited
liability company ("KMIG")
Xxxxxx Xxxxxx Transmix Company L.L.C., a [ ]
Xxxxxx Xxxxxx Texas Pipeline, L.P., a Delaware limited partnership
Heartland Pipeline Company, a Texas [corporation][general partnership],
Delta Terminal Services, Inc., a Delaware corporation
Queen City Terminals, Inc., a Delaware corporation
GATX
KMI subs...]
F-3
34
ANNEX I
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") [AND ARE ATTACHED HERETO];
(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][ARE ATTACHED HERETO]; 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;
F-4
35
(v) 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
F-5
36
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
(vi) 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.
F-6
