EXHIBIT 1.1
TEPPCO PARTNERS, L.P.
5,000,000
Common Units
representing Limited Partner Interests
UNDERWRITING AGREEMENT
August 7, 2003
UNDERWRITING AGREEMENT
August 7, 2003
UBS Securities LLC
Citigroup Global Markets Inc.
Xxxxxxx, Xxxxx & Co.
X.X. Xxxxxxx & Sons, Inc.
Wachovia Capital Markets, LLC
McDonald Investments Inc.
c/o UBS Securities LLC.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
TEPPCO Partners, L.P., a Delaware limited partnership (the
"Partnership"), proposes to issue and sell units representing limited partner
interests in the Partnership (the "Common Units") to the underwriters named in
Schedule A annexed hereto (collectively, the "Underwriters"), in an aggregate
amount of 5,000,000 common units (the "Firm Units"). In addition, solely for the
purpose of covering over-allotments, the Partnership proposes to grant to the
Underwriters the option to purchase from the Partnership up to an additional
750,000 Common Units (the "Additional Units"). The Firm Units and the Additional
Units are hereinafter collectively sometimes referred to as the "Units". The
Units are described in the Prospectus which is referred to below.
Each of (i) the Partnership, (ii) Texas Eastern Products Pipeline
Company, LLC, a Delaware limited liability company and general partner of the
Partnership (the "General Partner"), (iii) TEPPCO GP, Inc., a Delaware
corporation and general partner of each of the Operating Partnerships (as
defined below) and Jonah (as defined below) ("TEPPCO GP"), (iv) TE Products
Pipeline Company, Limited Partnership, a Delaware limited partnership ("TE
Products"), (v) TCTM, L.P., a Delaware limited partnership ("TCTM"), (vi) TEPPCO
Midstream Companies, L.P., a Delaware limited partnership ("TEPPCO Midstream"
and together with TE Products and TCTM, the "Operating Partnerships"), (vii)
Jonah Gas Gathering Company, a Wyoming general partnership ("Jonah"), (viii) Val
Verde Gas Gathering Company, L.P., a Delaware limited partnership ("Val Verde"),
and (ix) TEPPCO NGL Pipelines, L.L.C. ("TEPPCO NGL") are referred to
collectively as the "TEPPCO Entities".
The Partnership has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(the "Rules and Regulations" and together with the Securities Act of 1933, as
amended, the "Securities Act"), with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (File No. 333-100494)
including a prospectus, relating to the Units, which incorporates by reference
documents which the Partnership and TE Products have filed or will file in
accordance with the provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder (collectively, the "Exchange
Act"). Except where the context otherwise requires, the registration statement,
as amended when it became effective, including all financial statements,
exhibits and all documents filed as a part thereof or incorporated by reference
therein, and including any information contained in a prospectus subsequently
filed with the Commission pursuant to Rule 424(b) under the Securities Act and
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430(A) under the Securities Act and also including any
registration statement filed or to be filed pursuant to Rule 462(b) under the
Securities Act, is herein called the "Registration Statement". The prospectus,
including the base prospectus and prospectus supplement (the "Prospectus
Supplement"), and all documents incorporated therein by reference, in the form
filed by the Partnership with the Commission pursuant to Rule 424(b) under the
Securities Act on or before the second business day after the date hereof (or
such earlier time as may be required under the Securities Act) or, if no such
filing is required, the form of final prospectus included in the Registration
Statement at the time it became effective, is herein called the "Prospectus".
Any reference herein to the terms "amend," "amendment" or "supplement' with
respect to the Registration Statement or the Prospectus shall be deemed to refer
to and include any such document filed or to be filed under the Exchange Act
after the date of the Prospectus, and deemed to be incorporated therein by
reference.
The Partnership and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the warranties and
representations and subject to the terms and conditions herein set forth, the
Partnership agrees to issue and sell to each of the respective Underwriters, and
each of the Underwriters agrees, severally and not jointly, to purchase from the
Partnership, at a purchase price of $33.206 per unit, the aggregate number of
Firm Units set forth opposite the name of such Underwriter in Schedule A
attached hereto. The Partnership is advised by UBS Securities LLC that the
Underwriters intend initially to offer the Firm Units upon the terms set forth
in the Prospectus and Prospectus Supplement. The Underwriters may from time to
time increase or decrease the public offering price after the initial public
offering to such extent as they may determine.
In addition, the Partnership hereby grants to the several Underwriters
the option to purchase, and upon the basis of the warranties and representations
and subject to the terms and conditions herein set forth, the Underwriters shall
have the right to purchase, severally and not jointly, from the Partnership,
ratably in accordance with the number of Firm Units to be purchased by each of
them, all or a portion of the Additional Units as may be necessary to cover
over-allotments made in connection with the offering of the Firm Units, at the
same purchase price per unit to be paid by the Underwriters to the Partnership
for the Firm Units. This option may be exercised by UBS Securities LLC on behalf
of the several Underwriters in whole or in part at any time but not more than
once on or before the thirtieth (30th) calendar day following the date hereof,
by written notice to the Partnership. Such notice shall set forth the aggregate
number of Additional Units as to which the option is being exercised, and the
date and time when the Additional Units are to be delivered (such date and time
being herein referred to as the "additional time of purchase"); provided,
however, that the additional time of purchase shall not be earlier than the time
of purchase (as defined below) nor earlier than the second business day1 after
the date on which the option shall have been exercised nor later than the tenth
(10th) business day after the date on which the option shall have been
exercised. The number of Additional Units to be sold to each Underwriter shall
be the number which bears the same
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1 As used herein "business day" shall mean a day on which the New York Stock
Exchange is open for trading.
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proportion to the aggregate number of Additional Units being purchased as the
number of Firm Units set forth opposite the name of such Underwriter on Schedule
A hereto bears to the total number of Firm Units (subject, in each case, to such
adjustment as UBS Securities LLC may determine to eliminate fractional units).
2. Payment and Delivery. Payment of the purchase price for the Firm
Units shall be made to the Partnership by Federal funds wire transfer, against
delivery of the certificates for the Firm Units to the Underwriters through the
facilities of The Depository Trust Company ("DTC") for the respective accounts
of the Underwriters. Such payment and delivery shall be made by 11:00 a.m., New
York City time, on August 12, 2003 (unless another time shall be agreed to by
UBS Securities LLC. and the Partnership or unless postponed in accordance with
the provisions of Section 8 hereof). The time at which such payment and delivery
are actually made is hereinafter sometimes called the "time of purchase".
Electronic transfer of the Firm Units shall be made to the Underwriters at the
time of purchase in such names and in such denominations as they shall specify.
Payment of the purchase price for the Additional Units shall be made at
the additional time of purchase in the same manner and at the same office as the
payment for the Firm Units. Electronic transfer of the Additional Units shall be
made to the Underwriters at the time of purchase in such names and in such
denominations as they shall specify.
Deliveries of the documents described in Section 6 below with respect
to the purchase of the Units shall be made at the offices of Xxxxxx & Xxxxxx
L.L.P. by 8:30 a.m. Houston time, on the date of the closing of the purchase of
the Firm Units or the Additional Units, as the case may be.
3. Representations and Warranties of the Partnership. The Partnership
represents and warrants to each of the Underwriters that:
(a) Compliance with Registration Requirements. On the date the
Registration Statement was initially declared effective by the Commission (the
"Effective Date"), at all times subsequent to and including the time of purchase
or the additional time of purchase, as the case may be, and when any
post-effective amendment to the Registration Statement becomes effective or any
amendment or supplement to the Prospectus is filed with the Commission, the
Registration Statement and the Prospectus (as amended or as supplemented if the
Partnership or the Operating Partnerships shall have filed with the Commission
any amendment or supplement thereto), including the financial statements
included or incorporated by reference in the Prospectus or the Registration
Statement, did or, when so filed, will comply in all material respects with all
applicable provisions of the Securities Act, the Rules and Regulations, the
Exchange Act and the rules and regulations thereunder (the "Exchange Act Rules
and Regulations") and did or, when filed, will contain all statements required
to be stated therein in accordance with the Securities Act, the Rules and
Regulations, the Exchange Act and the Exchange Act Rules and Regulations. On the
Effective Date and when any post-effective amendment to the Registration
Statement (or any registration statement filed pursuant to Rule 462(b) under the
Securities Act that constitutes part of the Registration Statement) becomes
effective, no part of the Registration Statement or any such amendment did or
will contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein not misleading. At the Effective Date, the date
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the Prospectus or any amendment or supplement to the Prospectus is or was filed
with the Commission and at the time of purchase or the additional time of
purchase, as the case may be, the Prospectus did not or will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The foregoing representations and warranties in
this Section 3(a) do not apply to any statements or omissions made in reliance
on and in conformity with information relating to any Underwriter furnished in
writing to the Partnership by the Underwriters specifically for inclusion in the
Registration Statement or Prospectus or any amendment or supplement thereto. For
all purposes of this Agreement, (i) the amounts of the selling concession and
reallowance set forth in the fifth paragraph in the section captioned
"Underwriting" in the Prospectus and (ii) the eighth paragraph in the section
captioned "Underwriting" in the Prospectus regarding stabilization constitute
the only information relating to any Underwriter furnished in writing to the
Partnership by the Underwriters specifically for inclusion in the Registration
Statement or the Prospectus. The Partnership has not distributed any written
offering material in connection with the offering or sale of the Units other
than the Registration Statement and the Prospectus. No order preventing or
suspending the use of the Prospectus has been issued by the Commission.
(b) Incorporated Documents. The documents that are incorporated by
reference in the Registration Statement and the Prospectus or from which
information is so incorporated by reference, when they became effective or were
filed with the Commission, as the case may be, complied and will comply in all
material respects with the requirements of the Securities Act or the Exchange
Act, as applicable, the Rules and Regulations and the Exchange Act Rules 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 subsequent to the time of purchase or the
additional time of purchase, as the case may be, shall, when they are filed with
the Commission, conform in all material respects with the requirements of the
Securities Act and the Exchange Act, as applicable, the Rules and Regulations
and the Exchange Act Rules and Regulations and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statement therein not misleading.
(c) Capitalization. The Partnership's capital as of June 30, 2003 is as
set forth in the Prospectus Supplement in the column entitled "Actual" under the
heading "Capitalization". The adjustments to the Partnership's capital as of
June 30, 2003 as set forth under the column entitled "As Adjusted" represent the
adjusted effects on the Partnership's capital of the offer and sale of the Units
and the application of the estimated net proceeds from such offer and sale in
the manner set forth in the Prospectus Supplement under the heading "Use of
Proceeds", the related capital contribution by the General Partner and the other
transactions described therein.
(d) Formation and Good Standing of the Partnership, the Operating
Partnerships and the Subsidiary Partnerships. Each of the Partnership, the
Operating Partnerships and TEPPCO Crude Pipeline, L.P., TEPPCO Seaway L.P.,
TEPPCO Crude Oil, L.P. and Lubrication Services, L.P. (collectively, each of
TEPPCO Crude Pipeline, L.P., TEPPCO Seaway L.P., TEPPCO Crude Oil, L.P. and
Lubrication Services, L.P., the "TCTM Subsidiary Partnerships") and Chaparral
Pipeline Company, L.P., Quanah Pipeline Company,
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L.P., Xxxx Pipeline Company, L.P., Panola Pipeline Company, L.P., Val Verde and
Xxxxxx Pipeline Company, L.P. (collectively, each of Chaparral Pipeline Company,
L.P., Quanah Pipeline Company, L.P., Xxxx Pipeline Company, L.P., Panola
Pipeline Company, L.P., Val Verde and Xxxxxx Pipeline Company, L.P., the
"Midstream Subsidiary Partnerships" and together with the TCTM Subsidiary
Partnerships, the "Subsidiary Partnerships") has been duly formed and is, and at
the time of purchase or the additional time of purchase, as the case may be,
will be, validly existing as a limited partnership in good standing under the
Delaware Revised Uniform Limited Partnership Act, as amended (the "Delaware LP
Act"). Each of the Partnership, the Operating Partnerships and the Subsidiary
Partnerships has, and at the time of purchase or the additional time of
purchase, as the case may be, will have, full power and authority to conduct all
the activities conducted by it, to own, lease and operate its properties and to
conduct its business in all material respects as described in the Registration
Statement and the Prospectus and to enter into and perform its obligations under
this Agreement. Each of the Partnership, the Operating Partnerships and the
Subsidiary Partnerships is, and at the time of purchase or the additional time
of purchase, as the case may be, will be, duly qualified or registered and in
good standing as a foreign limited partnership to transact business in each
other jurisdiction in which such qualification or registration is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to register (i) would not,
individually or in the aggregate, result in a material adverse effect on the
business, properties, financial condition, results of operations or prospects of
the TEPPCO Entities and their subsidiaries taken as a whole or invalidate this
Agreement (a "Material Adverse Effect"), or (ii) would not subject the limited
partners of such partnership to any material liability or disability. The
Partnership is the sole limited partner of each of the Operating Partnerships,
in each case owning a limited partner interest of 99.999%. These limited partner
interests of the Operating Partnerships have been duly authorized by the
respective agreements of limited partnership of the Operating Partnerships (the
"Operating Partnership Agreements"), have been validly issued in accordance with
the respective Operating Partnership Agreements, are fully paid and
non-assessable, except to the extent such non-assessability may be affected by
Section 17-607 of the Delaware LP Act, and are the only outstanding limited
partner interests of each of the Operating Partnerships. TCTM is the sole
limited partner of TEPPCO Crude Oil, L.P. and TEPPCO Crude Pipeline, L.P., in
each case with a limited partner interest of 99.99%. TEPPCO Crude Oil, L.P. is
the sole limited partner of Lubrication Services, L.P.; and TEPPCO Crude
Pipeline, L.P. is the sole limited partner of TEPPCO Seaway, L.P., in each case
with a limited partner interest of 99.99%, respectively. TEPPCO Midstream is the
sole limited partner of each of the Midstream Subsidiary Partnerships, in each
case with a limited partner interest of 99.999%. The limited partner interests
of the Subsidiary Partnerships have been duly authorized by the respective
agreements of limited partnership of the Subsidiary Partnerships (the
"Subsidiary Partnership Agreements"), have been validly issued in accordance
with the respective Subsidiary Partnership Agreements, are fully paid and
non-assessable, except to the extent such non-assessability may be affected by
Section 17-607 of the Delaware LP Act, and are the only outstanding limited
partner interests of each of the Subsidiary Partnerships. The Partnership owns
such limited partner interests in the Operating Partnerships; TCTM owns such
limited partner interests in TEPPCO Crude Oil, L.P. and TEPPCO Crude Pipeline,
L.P.; TEPPCO Crude Oil, L.P. owns such limited partner interests in Lubrication
Services, L.P.; TEPPCO Crude Pipeline, L.P. owns such limited partner interests
in TEPPCO Seaway, L.P.; and TEPPCO Midstream owns such limited partner interests
in the Midstream Subsidiary Partnerships, either directly or indirectly, and
free and clear of all liens, encumbrances, security
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interests, equities, charges or claims, except for such liens, encumbrances,
security interests, equities, charges or claims as are not, individually or in
the aggregate, material or except as described in the Prospectus. TEPPCO Seaway,
L.P. owns a 50% general partner interest in Seaway Crude Pipeline Company. Such
general partner interest has been duly authorized and validly issued and is
owned of record free and clear of all liens, encumbrances, security interests,
equities, charges or claims, except for such liens, encumbrances, security
interests, equities, charges or claims as are not, individually or in the
aggregate, material. TEPPCO Midstream also owns a 99.999% general partner
interest in Jonah. Such general partner interest has been duly authorized and
validly issued and is owned of record free and clear of all liens, encumbrances,
security interests, equities, charges or claims, except for such liens,
encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material or except as described in the
Prospectus. TEPPCO Midstream is the sole member of each of TEPPCO NGL and TEPPCO
Colorado, L.L.C. ("TEPPCO Colorado"), and TCTM is the sole member of TEPPCO
Crude GP, LLC. These member interests have been duly authorized and validly
issued and are owned of record free and clear of all liens, encumbrances,
security interests, equities, charges or claims, except for such liens,
encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material. Complete and correct copies, as of
the date hereof, of (i) the agreement of limited partnership of the Partnership
(the "Partnership Agreement"), (ii) the Operating Partnership Agreements, (iii)
the Subsidiary Partnership Agreements, (iv) the agreement of limited partnership
of TEPPCO Seaway, L.P. and (v) the limited liability company agreements of each
of TEPPCO NGL, TEPPCO Colorado and TEPPCO Crude GP, LLC have been delivered to
counsel to the Underwriters, and no changes therein will be made subsequent to
the date hereof and prior to the time of purchase or the additional time of
purchase, as the case may be.
(e) Formation and Good Standing of the General Partner. The General
Partner has been duly organized and is, and at the time of purchase or the
additional time of purchase, as the case may be, will be, validly existing as a
limited liability company in good standing under the Delaware Limited Liability
Company Act ("Delaware LLC Act") and has full power and authority to conduct all
the activities conducted by it, to own, lease and operate its properties and to
conduct its business and to act as general partner of the Partnership, in each
case in all material respects, as described in the Registration Statement and
the Prospectus and to enter into and perform its obligations under this
Agreement; and the General Partner is, and at the time of purchase or the
additional time of purchase, as the case may be, will be, duly qualified or
registered and in good standing as a foreign limited liability company to
transact business in each other jurisdiction in which such qualification or
registration is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to register (i) would not result in a Material Adverse Effect, (ii) would not
subject its members to any material liability or disability or (iii) would not
subject any limited partner of the Partnership to any liability by reason of
such failure. The General Partner is the sole general partner of the Partnership
with a general partner interest in the Partnership of 2%. Such general partner
interest has been duly authorized by the Partnership Agreement, has been validly
issued in accordance with the Partnership Agreement, and is owned of record by
the General Partner, free and clear of all liens, encumbrances, security
interests, equities, charges or claims, except for such liens, encumbrances,
security interests, equities, charges or claims as are not, individually or in
the aggregate, material or except as described in the Prospectus. Complete and
correct copies of the certificate of formation and the limited liability company
agreement of the General Partner and all amendments thereto have been delivered
to the Underwriters, and no
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changes therein will be made subsequent to the date hereof and prior to the time
of purchase or the additional time of purchase, as the case may be.
(f) Formation and Good Standing of TEPPCO GP. TEPPCO GP has been duly
incorporated and is, and at the time of purchase or the additional time of
purchase, as the case may be, will be, validly existing as a corporation in good
standing under the Delaware General Corporation Law ("DGCL") and has full
corporate power and authority to conduct all the activities conducted by it, to
own, lease and operate its properties and to conduct its business and to act as
general partner of the Operating Partnerships, in each case in all material
respects, as described in the Registration Statement and the Prospectus and to
enter into and perform its obligations under this Agreement; and TEPPCO GP is,
and at the time of purchase or the additional time of purchase, as the case may
be, will be, duly qualified or registered and in good standing as a foreign
corporation to transact business in each other jurisdiction in which such
qualification or registration is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so to
qualify or to register (i) would not result in a Material Adverse Effect, (ii)
would not subject its securityholders to any material liability or disability,
or (iii) would not subject the Partnership, as the sole limited partner of each
of the Operating Partnerships to any liability by reason of such failure. All of
the capital stock of TEPPCO GP is owned of record by the Partnership, free and
clear of all liens, encumbrances, security interests, equities, charges, or
claims, except as set forth in the Prospectus or as are not, individually or in
the aggregate, material. TEPPCO GP is the sole general partner of each of the
Operating Partnerships and, with respect to Jonah, the sole managing general
partner, in each case with a general partner interest of 0.001%. These general
partner interests have been duly authorized by the respective Operating
Partnership Agreements (or, in the case of Jonah, by its agreement of general
partnership), have been validly issued in accordance with the respective
Operating Partnership Agreements (or, in the case of Jonah, by its agreement of
general partnership), and are owned of record by TEPPCO GP, free and clear of
all liens, encumbrances, security interests, equities, charges or claims, except
for such liens, encumbrances, security interests, equities, charges or claims as
are not, individually or in the aggregate, material or except as described in
the Prospectus. Complete and correct copies of the certificate of incorporation
and the bylaws of TEPPCO GP and all amendments thereto have been delivered to
counsel to the Underwriters, and no changes therein will be made subsequent to
the date hereof and prior to the time of purchase or the additional time of
purchase, as the case may be.
(g) Formation and Good Standing of TEPPCO NGL. TEPPCO NGL has been duly
organized and is, and at the time of purchase or the additional time of
purchase, as the case may be, will be, validly existing as a limited liability
company in good standing under the Delaware LLC Act and has full limited
liability company power and authority to conduct all the activities conducted by
it, to own, lease and operate its properties and to conduct its business and to
act as general partner of each of the Midstream Subsidiary Partnerships, in each
case in all material respects, as described in the Registration Statement and
the Prospectus; and TEPPCO NGL is, and at the time of purchase or the additional
time of purchase, as the case may be, will be, duly qualified or registered and
in good standing as a foreign limited liability company to transact business in
each other jurisdiction in which such qualification or registration is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to register (i) would not
result in a Material Adverse Effect or (ii) would not subject its members to any
material liability or disability. TEPPCO NGL is the sole general partner of each
of the Midstream Subsidiary Partnerships, in each case with a
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general partner interest of 0.001%. These general partner interests have been
duly authorized by the respective Subsidiary Partnership Agreements, have been
validly issued in accordance with the respective Subsidiary Partnership
Agreements, and are owned of record by TEPPCO NGL, free and clear of all liens,
encumbrances, security interests, equities, charges or claims, except for such
liens, encumbrances, security interests, equities, charges or claims as are not,
individually or in the aggregate, material or except as described in the
Prospectus. Complete and correct copies of the certificate of formation and the
limited liability company agreement of TEPPCO NGL and all amendments thereto
have been delivered to the Underwriters, and no changes therein will be made
subsequent to the date hereof and prior to the time of purchase or the
additional time of purchase, as the case may be.
(h) Formation and Good Standing of TEPPCO Crude GP, LLC. TEPPCO Crude
GP, LLC has been duly organized and is, and at the time of purchase or the
additional time of purchase, as the case may be, will be, validly existing as a
limited liability company in good standing under the Delaware LLC Act and has
full limited liability company power and authority to conduct all the activities
conducted by it, to own, lease and operate its properties and to conduct its
business and to act as general partner of each of the TCTM Subsidiary
Partnerships, in each case in all material respects, as described in the
Registration Statement and the Prospectus; and TEPPCO Crude GP, LLC is, and at
the time of purchase or the additional time of purchase, as the case may be,
will be, duly qualified or registered and in good standing as a foreign limited
liability company to transact business in each other jurisdiction in which such
qualification or registration is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so to
qualify or to register (i) would not result in a Material Adverse Effect or (ii)
would not subject its members to any material liability or disability. TEPPCO
Crude GP, LLC is the sole general partner of the TCTM Subsidiary Partnerships,
in each case with a general partner interest of 0.01%. These general partner
interests have been duly authorized by the respective Subsidiary Partnership
Agreements, have been validly issued in accordance with the respective
Subsidiary Partnership Agreements, and are owned of record by TEPPCO Crude GP,
LLC, free and clear of all liens, encumbrances, security interests, equities,
charges or claims, except for such liens, encumbrances, security interests,
equities, charges or claims as are not, individually or in the aggregate,
material or except as described in the Prospectus. Complete and correct copies
of the certificate of formation and the limited liability company agreement of
TEPPCO Crude GP, LLC and all amendments thereto have been delivered to the
Underwriters, and no changes therein will be made subsequent to the date hereof
and prior to the time of purchase or the additional time of purchase, as the
case may be.
(i) Formation and Good Standing of TEPPCO Colorado. TEPPCO Colorado has
been duly organized and is, and at the time of purchase or the additional time
of purchase, as the case may be, will be, validly existing as a limited
liability company in good standing under the Delaware LLC Act and has full
limited liability company power and authority to conduct all the activities
conducted by it, to own, lease and operate its properties and to conduct its
business, in each case in all material respects; and TEPPCO Colorado is, and at
the time of purchase or the additional time of purchase, as the case may be,
will be, duly qualified or registered and in good standing as a foreign limited
liability company to transact business in each other jurisdiction in which such
qualification or registration is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so to
qualify or to register
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(i) would not result in a Material Adverse Effect or (ii) would not subject its
members to any material liability or disability.
(j) Formation and Good Standing of Jonah. Jonah has been duly formed
and is, and at the time of purchase or the additional time of purchase, as the
case may be, will be, validly existing as a general partnership in good standing
under the Wyoming Uniform Partnership Act, as amended (the "Wyoming Act"). Jonah
has, and at the time of purchase or the additional time of purchase, as the case
may be, will have, full partnership power and authority to conduct all the
activities conducted by it, to own, lease and operate its properties and to
conduct its business in all material respects as described in the Registration
Statement and the Prospectus. Jonah is not, and at the time of purchase or the
additional time of purchase, as the case may be, will not be, required to
register or qualify as a foreign general partnership to transact business in any
other jurisdiction in which such qualification or registration is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to register (i) would not
result in a Material Adverse Effect or (ii) would not subject the partners of
such partnership to any material liability or disability.
(k) Partnership Interests. As of the date of this Agreement, the
limited partners of the Partnership hold limited partner interests in the
Partnership aggregating a 98% interest in the Partnership, such limited partner
interests being represented by 57,751,447 Common Units, including 2,500,000
Common Units held by an affiliate of Duke Energy Corporation. The Common Units
are the only limited partner interests of the Partnership that are issued and
outstanding; all of the issued and outstanding Common Units of the Partnership
have been (1) duly authorized and validly issued under the Partnership Agreement
and are fully paid and non-assessable, except as such nonassessability may be
affected by Section 17-607 of the Delaware LP Act, and (2) issued in compliance
with all applicable federal and state laws and were not issued in violation of
any preemptive right, resale right, right of first refusal or similar right.
(l) Capitalization of the General Partner. All of the membership
interests of the General Partner are registered on its books in the name of Duke
Energy Field Services, L.P., a Delaware limited partnership ("DEFS"), free and
clear of all liens, encumbrances, security interests, equities, charges or
claims, except as set forth in the Prospectus or as are not, individually or in
the aggregate, material.
(m) Absence of Defaults and Conflicts. None of the TEPPCO Entities nor
any of their subsidiaries is in breach of, or in default under (nor has any
event occurred which with notice, lapse of time, or both would result in any
breach of, or constitute a default under), the respective partnership agreement
or certificate of limited partnership or limited liability company agreement or
articles or certificate of incorporation or formation, or any other
organizational document, as the case may be, or in the performance or observance
of any obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or any lease, contract or other agreement or instrument to which
any of the TEPPCO Entities or any of their subsidiaries is a party or by which
any of them or any of their properties is bound, and the execution, delivery and
performance of this Agreement and the issuance of the Units and consummation of
the transactions contemplated hereby and thereby will not conflict with, or
result in any breach of or constitute a default under (or constitute any event
which with notice, lapse of time, or both would
-9-
result in any breach of, or constitute a default under), any provisions of the
respective partnership agreement or certificate of limited partnership or
limited liability company agreement or articles or certificate of incorporation
or formation, or any other organizational document, as the case may be, of any
of the TEPPCO Entities or any of their subsidiaries or under any provision of
any license, indenture, mortgage, deed of trust, bank loan or credit agreement
or other evidence of indebtedness, or any lease, contract or other agreement or
instrument to which any of the TEPPCO Entities or any of their subsidiaries is a
party or by which any of them or their respective properties may be bound or
affected, or under any federal, state, local or foreign law, regulation or rule
or any decree, judgment or order applicable to any of the TEPPCO Entities or any
of their subsidiaries.
(n) Authorization of Underwriting Agreement. This Agreement has been
duly authorized, executed and delivered by the Partnership and is a legal, valid
and binding agreement of the Partnership enforceable in accordance with its
terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally and general principles of equity.
(o) Accuracy of Disclosure. The Common Units conform in all material
respects to the descriptions thereof contained in the Registration Statement,
Prospectus and Prospectus Supplement. All legal or governmental proceedings,
affiliate transactions, contracts, leases or documents of a character required
to be described in the Registration Statement, the Prospectus, the Prospectus
Supplement or the documents incorporated by reference therein or to be filed as
an exhibit thereto have been so described or filed as required. There are no
contracts or documents which are required to be described in the Registration
Statement, the Prospectus, the Prospectus Supplement or the documents
incorporated by reference therein or to be filed as exhibits thereto which have
not been so described and filed as required.
(p) Authorization of Units. The Units to be issued and sold by the
Partnership have been duly and validly authorized and, when issued and delivered
against payment therefor as provided herein, will be duly and validly issued and
fully paid and non-assessable, except as such nonassessability may be affected
by Section 17-607 of the Delaware LP Act and will not be subject to any
preemptive or similar right or voting or transfer restriction.
(q) Absence of Further Requirements. No approval, authorization,
consent or order of or filing with any national, state or local governmental or
regulatory commission, board, body, authority or agency is required in
connection with the issuance and sale of the Units or the consummation of the
transactions as contemplated hereby other than registration of the Units under
the Securities Act, which has been or will be completed, and any necessary
qualification under the Securities or blue sky laws of the various jurisdictions
in which the Units are being offered by the Underwriters or under the rules and
regulations of the National Association of Securities Dealers, Inc. ("NASD").
(r) Absence of Restrictions on Units. Except as set forth in the
Registration Statement and the Prospectus and except for any such rights which
have been effectively complied with or waived, (i) no person has the right,
contractual or otherwise, to cause the Partnership to issue or sell to it any
units representing limited partner interests in the Partnership, (ii) no person
has any preemptive rights, resale rights, rights of first refusal or other
rights to purchase any units representing limited partner interests in the
Partnership, and (iii) no person
-10-
has the right to act as an underwriter, or as a financial advisor to the
Partnership, in connection with the offer and sale of the Units, in the case of
each of the foregoing clauses (i), (ii) and (iii), whether as a result of the
filing or effectiveness of the Registration Statement or the sale of the Units
as contemplated thereby or otherwise; no person has the right, contractual or
otherwise, to cause the Partnership to register under the Securities Act any
units representing limited partner interests in the Partnership, or to include
any units representing limited partner interests in the Partnership in the
Registration Statement or the offering contemplated thereby whether as a result
of the filing or effectiveness of the Registration Statement or the sale of the
Units as contemplated thereby or otherwise, except for such rights as have been
complied with or waived.
(s) Independent Accountants. KPMG, LLP ("KPMG") whose reports on the
consolidated financial statements of the Partnership and its subsidiaries are
filed with the Commission as part of, or incorporated by reference into, the
Registration Statement and Prospectus, are independent public accountants as
required by the Securities Act and Exchange Act. PricewaterhouseCoopers, LLP
("PWC") whose reports on the combined financial statements of the Burlington
Resources Gathering Inc., Val Verde Gathering and Processing System are filed
with the Commission as part of the Partnership's Current Report on Form 8-K
filed with the Commission on July 2, 2002, as amended by Form 8-K/A filed with
the Commission on August 12, 2002 and Form 8-K/A filed with the Commission on
October 8, 2002 incorporated by reference into the Registration Statement and
Prospectus, are independent public accountants as required by the Securities Act
and Exchange Act. The statements included in, or incorporated by reference by,
the Registration Statement with respect to the accountants pursuant to Rule 509
of Regulation S-K of the Rules and Regulations are true and correct in all
material respects.
(t) Possession of Licenses and Permits. Each of the TEPPCO Entities and
their subsidiaries has all necessary licenses, authorizations, consents and
approvals and has made all necessary filings required under any federal, state,
local or foreign law, regulation or rule, and has obtained all necessary
authorizations, consents and approvals from other persons, in order to conduct
its respective business; none of the TEPPCO Entities or their subsidiaries is in
violation of, or in default under, any such license, authorization, consent or
approval or any federal, state, local or foreign law, regulation or rule or any
decree, order or judgment applicable to any of the TEPPCO Entities or their
subsidiaries, the effect of which, individually or in the aggregate, could have
a Material Adverse Effect.
(u) Absence of Proceedings. Except as disclosed in the Prospectus,
there are no actions, suits, claims, investigations or proceedings pending or
threatened to which any of the TEPPCO Entities or their subsidiaries or any of
their respective officers is a party or of which any of their respective
properties is subject, at law or in equity, or before or by any federal, state,
local or foreign governmental or regulatory commission, board, body, authority
or agency which could result in a judgment, decree or order having a Material
Adverse Effect or prevent consummation of the transactions contemplated hereby.
(v) Financial Statements. The financial statements included or
incorporated by reference in the Registration Statement and the Prospectus,
together with the related schedules and notes, present fairly the consolidated
financial position of the Partnership and its subsidiaries at the dates
indicated and the consolidated results of operations, cash flows and changes in
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financial position of the Partnership and its subsidiaries for the periods
specified; such financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a consistent basis
during the periods involved. The other financial and statistical date set forth
in the Registration Statement and Prospectus are accurately presented and
prepared on a basis consistent with the financial statements and books and
records of the Partnership. The supporting schedules, if any, included in the
Registration Statement present fairly in accordance with GAAP the information
required to be stated therein. No other financial statements or schedules of the
Partnership are required by the Securities Act, the Rules and Regulations, the
Exchange Act or the Exchange Act Rules and Regulations to be included in the
Registration Statement or the Prospectus. None of the TEPPCO Entities or their
subsidiaries have any material liabilities or obligations, direct or contingent
(including any off-balance sheet obligations), not disclosed in the Registration
Statement, the Prospectus or the documents incorporated by reference therein.
(w) No Material Adverse Change in Business. Subsequent to the
respective dates as of which information is given in the Registration Statement
and the Prospectus there has not been (i) any material adverse change, or any
development involving a prospective material adverse change, in the business,
properties, management, financial condition or results of operations of any of
the TEPPCO Entities and their subsidiaries taken as a whole, (ii) any
transaction which is material to any of the TEPPCO Entities and their
subsidiaries taken as a whole, (iii) any obligation, direct or contingent
(including any off-balance sheet obligations), which is material to the TEPPCO
Entities or their subsidiaries taken as a whole, incurred by any of the TEPPCO
Entities or their subsidiaries, (iv) any material change in the capital stock,
equity interests or outstanding indebtedness of any of the TEPPCO Entities or
their subsidiaries, (v) any dividend or distribution of any kind declared, paid
or made by the Partnership, or (vi) any event that has invalidated or could
invalidate the Agreement.
(x) Lock-Up Agreements. The Partnership has obtained for the benefit of
the Underwriters the agreement, in the form set forth as Exhibit A-1 hereto, of
each of the General Partner's directors and officers as set forth on Schedule C,
and the agreement, in the form set forth as Exhibit A-2 hereto, of Duke Energy
Corporation, on behalf of itself and its subsidiaries that own Common Units
(collectively, the agreements set forth in Exhibits A-1 and A-2, the "Lock-Up
Agreements"); the Partnership will not release or purport to release any person
from any Lock-Up Agreement without the prior written consent of UBS Securities
LLC.
(y) Investment Company Act. None of the TEPPCO Entities or their
subsidiaries is, and upon the issuance and sale of the Units as herein
contemplated and the application of the net proceeds therefrom as described in
the Prospectus will not be, 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.
(z) Public Utility Holding Company Act. None of the TEPPCO Entities or
their subsidiaries is a "holding company" as such term is defined in the Public
Utility Holding Company Act of 1935, as amended; neither the TEPPCO Entities nor
the issue and sale of the Units by the Partnership is subject to regulation
under PUHCA; and none of the TEPPCO Entities is a "public utility" as such term
is defined in the Federal Power Act, as amended.
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(aa) Tax Returns and Payments. Each of the TEPPCO Entities has filed
all federal, state and foreign income and franchise tax returns required by law
to be filed by them and have paid all taxes, assessments and other governmental
charges, including any interest, additions to tax or penalties applicable
thereto, levied upon them or any of their properties, assets, income or
franchises which are due and payable, other than (i) those which are not past
due or are presently being contested in good faith by appropriate proceedings
diligently conducted for which such reserves or other appropriate provisions, if
any, as shall be required by generally accepted accounting principles have been
made and (ii) with respect to state and local taxes, such as will not result in
a Material Adverse Effect. There are no tax returns of any of the TEPPCO
Entities that are currently being audited by state, local or federal taxing
authorities or agencies (and with respect to which any of the TEPPCO Entities
has received notice), where the findings of such audit, if adversely determined,
would result in a Material Adverse Effect.
(bb) Insurance. Each of the TEPPCO Entities and their subsidiaries
maintains insurance with respect to its properties and business of the types and
in amounts generally deemed adequate for its business and consistent with
insurance coverage maintained by similar companies and businesses, all of which
insurance is in full force and effect.
(cc) No Business Interruptions. None of the TEPPCO Entities nor any of
their subsidiaries has sustained since the date of the last financial statements
included in the Prospectus any material loss or interference with their
respective 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.
(dd) Absence of Notice. None of the TEPPCO Entities nor any of their
subsidiaries have sent or received any communication regarding termination of,
or intent not to renew, any of the contracts or agreements referred to or
described in, or filed as an exhibit to, the Registration Statement or any
document incorporated by reference therein, and no such termination or
non-renewal has been threatened by the Partnership or, to the knowledge of the
Partnership after due inquiry, any other party to any such contract or
agreement, which termination or non-renewal would have a Material Adverse
Effect.
(ee) Internal Accounting Controls. The TEPPCO Entities and their
subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(ff) Validity of Data. Any statistical and market-related data included
in the Prospectus are based on or derived from sources that the Partnership
believes to be reliable and accurate, and the Partnership has obtained the
written consent to the use of such data from such sources to the extent the
General Partner believes is required.
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(gg) Stabilization. None of the TEPPCO Entities, nor any of their
directors, officers or controlling persons has taken, directly or indirectly,
any action intended, or which might reasonably be expected, to cause or result,
under the Securities Act or otherwise, in or which has constituted,
stabilization or manipulation of the price of any security of the Partnership to
facilitate the sale or resale of the Units.
(hh) Violations. None of the TEPPCO Entities nor any of their
subsidiaries, nor to the Partnership's knowledge after due inquiry, any employee
or agent of the TEPPCO Entities, has made any payment of funds of the TEPPCO
Entities or received or retained any funds in violation of any law, rule or
regulation, which payment, receipt or retention of funds is of a character
required to be disclosed in the Registration Statement or Prospectus.
(ii) Possession of Intellectual Property. Each of the TEPPCO Entities
and their subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks,
trade names or other intellectual property (collectively, "Intellectual
Property") necessary to carry on the business now operated by them, and none of
the TEPPCO Entities nor any of their subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights of
others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or inadequate
to protect the interest of any of the TEPPCO Entities or their subsidiaries, and
which infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect.
(jj) Absence of Labor Dispute. No labor dispute with the employees of
any of the TEPPCO Entities or any of their subsidiaries exists or, to the
knowledge of any of the TEPPCO Entities, is imminent or threatened, and none of
the TEPPCO Entities has any actual knowledge of an existing, imminent or
threatened labor disturbance by the employees of any of its, or any of its
affiliates', principal suppliers, manufacturers, customers or contractors,
which, in either case, could reasonably be expected to result in a Material
Adverse Effect. Each of the TEPPCO Entities and their subsidiaries is in
compliance with all federal, state and local employment labor laws, including,
but not limited to, laws relating to non-discrimination in hiring, promotion and
pay of employees, except for any noncompliance that could not reasonably be
expected to result in a Material Adverse Effect.
(kk) Benefit Plans. With respect to each employee benefit plan, program
and arrangement (including, without limitation, any "employee benefit plan" as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) maintained or contributed to by any of the TEPPCO Entities
or their subsidiaries, or with respect to which any of the TEPPCO Entities could
incur any liability under ERISA (collectively, the "Benefit Plans"), no event
has occurred and, to the best knowledge of each of the TEPPCO Entities or their
subsidiaries, there exists no condition or set of circumstances, in connection
with which any of the TEPPCO Entities or their subsidiaries could be subject to
any liability under the terms of such Benefit Plans, applicable law (including,
without limitation, ERISA and the Internal Revenue Code of 1986, as amended) or
any applicable agreement that could have a Material Adverse Effect.
-14-
(ll) Environmental Laws. Each of the TEPPCO Entities and their
subsidiaries (i) is in compliance with any and all applicable foreign, federal,
state and local laws and regulations relating to the protection of human health
and safety, the environment or imposing liability or standards of conduct
concerning any Hazardous Material (as hereinafter defined) ("Environmental
Laws"), (ii) has received all permits, licenses or other approvals required of
it under Environmental Laws to conduct its business and (iii) is in compliance
with all terms and conditions of any such permit, license or approval, except
where such noncompliance with Environmental Laws, failure to receive required
permits, licenses or other approvals or failure to comply with the terms and
conditions of such permits, licenses or approvals would not, individually or in
the aggregate, result in a Material Adverse Effect. The term "Hazardous
Material" means (A) any "hazardous substance" as defined by the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended, (B)
any "hazardous waste" as defined by the Resource Conservation and Recovery Act,
as amended, (C) any petroleum or petroleum product, (D) any polychlorinated
biphenyl and (E) any pollutant or contaminant or hazardous, dangerous, or toxic
chemical, material, waste or substance regulated under or within the meaning of
any other Environmental Law.
In the ordinary course of its business, the Partnership conducts a
periodic review of the effect of Environmental Laws on the business, operations
and properties of the TEPPCO Entities and their subsidiaries, in the course of
which it identifies and evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any permit,
license or approval, any related constraints on operating activities and any
potential liabilities to third parties). Except as set forth in the Registration
Statement and the Prospectus, there are no costs and liabilities associated with
or arising in connection with Environmental Laws as currently in effect
(including without limitation, costs of compliance therewith) which would,
singly or in the aggregate, have a Material Adverse Effect.
(mm) Title to Property. Each of the TEPPCO Entities and their
subsidiaries have satisfactory and marketable title to all properties and assets
owned by such entities, in each case free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any kind
except such as (i) are described in the Prospectus or (ii) do not, singly or in
the aggregate, materially affect the value of such property and do not interfere
with the use made and proposed to be made of such property by such entities; and
all of the leases and subleases material to the business of such entities, and
under which such entities hold properties described in the Prospectus, are in
full force and effect, and none of such entities has any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of such
entities under any of the leases or subleases mentioned above, or affecting or
questioning the rights of such entities to the continued possession of the
leased or subleased premises under any such lease or sublease.
(nn) Partnership Agreements. The Partnership Agreement is a valid and
legally binding agreement of the General Partner, enforceable against the
General Partner in accordance with its terms, and each of the Operating
Partnership Agreements and Subsidiary Partnership Agreements is a valid and
legally binding agreement of the parties thereto, enforceable against the
parties thereto in accordance with its terms, except as the enforceability of
such agreements may be affected by bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors' rights
and general equitable principles.
-15-
(oo) Disclosure. Neither this Agreement, the Registration Statement,
nor any other document, certificate or instrument delivered to the Underwriters
by or on behalf of the Partnership in connection with the transactions
contemplated by this Agreement, contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements
contained therein not misleading. There is no fact known to the Partnership or
the General Partner which would result in a Material Adverse Effect or in the
future may (so far as the Partnership can now foresee) result in a Material
Adverse Effect which has not been set forth or referred to in this Agreement or
the Registration Statement.
(pp) Significant Subsidiaries. The subsidiaries listed on Schedule B
attached hereto are the only significant subsidiaries of ---------- the
Partnership as defined by Rule 1-02 of Regulation S-X.
(qq) Registration Rights. No holder of securities of the Partnership
has rights to the registration of any securities of the Partnership because of
the filing of the Registration Statement that have not been waived.
(rr) Officers' Certificates. Any certificate signed on behalf of the
Partnership or the General Partner by any President or Vice President of the
General Partner and delivered to the Underwriters or to counsel for the
Underwriters shall be deemed a representation and warranty by each of the TEPPCO
Entities to each Underwriter as to the matters covered thereby.
(ss) NASD Affiliations. To the Partnership's knowledge after due
inquiry, there are no affiliations or associations between any member of the
National Association of Securities Dealers, Inc. and any of the Partnership or
General Partner's officers, directors or securityholders, except as set forth in
the Registration Statement and the Prospectus.
(tt) Internal Controls and Disclosure Controls. The Partnership has
established and maintains disclosure controls and procedures (as such term is
defined in Rule 13a-14 and 15d-14 under the Exchange Act); such disclosure
controls and procedures are designed to ensure that material information
relating to the Partnership, including its consolidated subsidiaries, is made
known to the General Partner's Chief Executive Officer and its Chief Financial
Officer by others within those entities, and such disclosure controls and
procedures are effective to perform the functions for which they were
established; the Partnership's auditors and the Audit Committee of the Board of
Directors have been advised of: (i) any significant deficiencies in the design
or operation of internal controls which could adversely affect the Partnership's
ability to record, process, summarize, and report financial data; and (ii) any
fraud, whether or not material, that involves management or other employees who
have a role in the Partnership's internal controls; any material weaknesses in
internal controls have been identified for the Partnership's auditors; and since
the date of the most recent evaluation of such disclosure controls and
procedures, there have been no significant changes in internal controls or in
other factors that could significantly affect internal controls, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
(uu) Personal Loans. The Partnership has provided you true, correct,
and complete copies of all documentation pertaining to any extension of credit
in the form of a personal loan made, directly or indirectly, by the Partnership
to any director or executive officer of the General Partner, or to any family
member or affiliate of any director or executive officer
-16-
of the General Partner; and since July 30, 2002, the Partnership has not,
directly or indirectly, including through any subsidiary: (i) extended credit,
arranged to extend credit, or renewed any extension of credit, in the form of a
personal loan, to or for any director or executive officer of the General
Partner, or to or for any family member or affiliate of any director or
executive officer of the General Partner; or (ii) made any material
modification, including any renewal thereof, to any term of any personal loan to
any director or executive officer of the Partnership, or any family member or
affiliate of any director or executive officer, which loan was outstanding on
July 30, 2002;.
In addition, any certificate signed by any officer of the TEPPCO
Entities and delivered to the Underwriters or counsel for the Underwriters in
connection with the offering of the Units shall be deemed to be a representation
and warranty by the TEPPCO Entities, as to matters covered thereby, to each
Underwriter.
4. Certain Covenants of the Partnership. The Partnership hereby agrees:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Units for offering and sale under the securities or
blue sky laws of such states as the Underwriters may designate and to maintain
such qualifications in effect as long as required for the distribution of the
Units, provided that none of the TEPPCO Entities shall be required to qualify as
a foreign corporation or to consent to the service of process under the laws of
any such state (except service of process with respect to the offering and sale
of the Units); and to promptly advise the Underwriters of the receipt by the
TEPPCO Entities of any notification with respect to the suspension of the
qualification of the Units for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.
(b) to make available to the Underwriters in New York City, without
charge, as many copies of the Prospectus (or of the Prospectus as amended or
supplemented if the Partnership shall have made any amendments or supplements
thereto after the Effective Date of the Registration Statement) as the
Underwriters may reasonably request for the purposes contemplated by the
Securities Act; in case any Underwriter is required to deliver a prospectus
within the nine-month period referred to in Section 10(a)(3) of the Securities
Act in connection with the sale of the Units, the Partnership will prepare
promptly upon request such amendment or amendments to the Registration Statement
and such prospectuses as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the Securities Act.
(c) to advise the Underwriters promptly and (if requested by you) to
confirm such advice in writing (i) when any post-effective amendment to the
Registration Statement becomes effective and (ii) if Rule 430A under the
Securities Act is used, when the Prospectus is filed with the Commission
pursuant to Rule 424(b) under the Securities Act (which the Partnership agrees
to file in a timely manner under such Rules).
(d) to advise the Underwriters promptly, confirming such advice in
writing, of any request by the Commission for amendments or supplements to the
Registration Statement or Prospectus or for additional information with respect
thereto, or of notice of institution of proceedings for or the entry of a stop
order suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of the
Registration Statement, to make every reasonable effort to obtain the lifting or
removal of such
-17-
order as soon as possible; to advise the Underwriters promptly of any proposal
to amend or supplement the Registration Statement or Prospectus including by
filing any documents that would be incorporated therein by reference, to furnish
the Underwriters with a draft of such proposed amendment for review and comment
a reasonable amount of time prior to any proposed filing and to file no such
amendment or supplement to which the Underwriters shall object in writing.
(e) to file promptly all reports and any definitive proxy or
information statement required to be filed by the Partnership or TE Products
with the Commission in order to comply with the Exchange Act subsequent to the
date of the Prospectus and for so long as the delivery of a prospectus is
required in connection with the offering or sale of the Units, and to promptly
notify the Underwriters of such filing.
(f) if necessary or appropriate, to file a registration statement
pursuant to Rule 462(b) under the Securities Act.
(g) to furnish or otherwise make available to the Underwriters and,
upon request, to each of the other Underwriters for a period of three years from
the date of this Agreement the following documents, provided such documents are
not otherwise publicly available via XXXXX: (i) copies of any reports or other
communications which the Partnership shall send to the holders of any class of
its limited partnership interests or debt securities or shall from time to time
publish or publicly disseminate, (ii) copies of all annual, quarterly and
current reports filed with the Commission on Forms 10-K, 10-Q and 8-K, or such
other similar form as may be designated by the Commission, (iii) copies of
documents or reports filed with any national securities exchange on which any
class of securities of the Partnership is listed, and (iv) such other
information as the Underwriters may reasonably request regarding the TEPPCO
Entities or their subsidiaries, in each case as soon as such communications,
documents or information become available.
(h) to advise the Underwriters promptly of the happening of any event
known to the Partnership or its subsidiaries within the time during which a
prospectus relating to the Units is required to be delivered under the
Securities Act which could require the making of any change in the Prospectus
then being used so that the Prospectus would not include an untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading, and, during such time, subject to 4(d) hereof, to prepare and
furnish, at the Partnership's expense, to the Underwriters promptly such
amendments or supplements to such Prospectus as may be necessary to reflect any
such change and to furnish to the Underwriters a copy of such proposed amendment
or supplement before filing any such amendment or supplement with the
Commission.
(i) to make generally available to holders of its securities as soon as
may be practicable but in no event later than the last day of the fifteenth full
calendar month following the calendar quarter in which the Effective Date falls,
and to deliver to the Underwriters, an earnings statement of the Partnership
(which will satisfy the provisions of Section 11(a) of the Securities Act,
including Rule 158 of the Rules and Regulations) for a period of twelve months
beginning after the Effective Date of the Registration Statement (as defined in
Rule 158(c) of the
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Securities Act) as soon as is reasonably practicable after the termination of
such twelve-month period.
(j) to furnish to the Underwriters, upon request and without charge,
two copies of the Registration Statement, as initially filed with the
Commission, and of all amendments thereto (including all financial statements,
schedules and exhibits thereto and documents incorporated by reference therein),
which are certified by an officer of the General Partner to be true and correct,
and sufficient conformed copies of the foregoing (other than exhibits) for
distribution to each of the other Underwriters.
(k) to furnish to the Underwriters as early as practicable prior to the
time of purchase, but no later than two business days prior thereto, a copy of
the latest available unaudited interim consolidated financial statements, if
any, of the TEPPCO Entities and their subsidiaries which have been read by the
independent certified public accountants, as stated in their letter to be
furnished pursuant to Section 6(b) hereof.
(l) to apply the net proceeds from the sale of the Units in the manner
set forth under the caption "Use of Proceeds" in the ----------------
Prospectus.
(m) to pay all costs, expenses, fees and taxes (other than any transfer
taxes and fees and disbursements of counsel for the Underwriters except as set
forth under Section 5 hereof and (iii), (iv) and (vi) below) in connection with
(i) the preparation and filing of the Registration Statement, the Prospectus,
and any amendments or supplements thereto, and the printing and furnishing of
copies of each thereof to the Underwriters and to dealers (including costs of
mailing and shipment), (ii) the registration, issuance and delivery of the
Units, (iii) the producing, word processing and/or printing of this Agreement,
an Agreement Among Underwriters, any dealer agreements, any Powers of Attorney
and any closing documents (including compilations thereof), and the reproduction
and/or printing and furnishing of copies of each thereof to the Underwriters and
(except closing documents) to dealers (including costs of mailing and shipment),
(iv) the qualification of the Units for offering and sale under state laws and
the determination of their eligibility for investment under state law as
aforesaid (including the legal fees and filing fees and other disbursements of
counsel for the Underwriters) and the printing and furnishing of copies of any
blue sky surveys or legal investment surveys to the Underwriters and to dealers,
(v) any listing of the Units on any securities exchange and any registration
thereof under the Exchange Act, (vi) any fees payable to investment rating
agencies with respect to the Units, (vii) any filing for review of the public
offering of the Units by the NASD, (viii) the performance of the Partnership's
other obligations hereunder and (ix) the costs and expenses of the TEPPCO
Entities relating to investor presentations on any "road show" undertaken in
connection with the marketing of the offering of the Units, including, without
limitation, expenses associated with the production of road show slides and
graphics, fees and expenses of any consultants engaged in connection with the
road show presentations with the prior approval of the Partnership, travel and
lodging expenses of the representatives and officers of the TEPPCO Entities and
any such consultants, and the cost of any aircraft chartered in connection with
the road show.
(n) to furnish to the Underwriters, before filing with the Commission
subsequent to the Effective Date of the Registration Statement and during the
period referred to
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in paragraph (e) above, a copy of any document proposed to be filed pursuant to
Section 13, 14 or 15(d) of the Exchange Act.
(o) to comply with all the provisions of any undertakings contained in
the Registration Statement.
(p) not to sell, offer or agree to sell, contract to sell, hypothecate,
pledge, grant any option to sell or otherwise dispose of, directly or indirectly
(or enter into any transaction which is designed to, or might reasonably be
expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise)), Common
Units or securities convertible into or exchangeable or exercisable for Common
Units or warrants or other rights to purchase Common Units or any other
securities of the Partnership that are substantially similar to Units, or file
or cause to be declared effective a registration statement under the Securities
Act relating to the offer and sale of any Common Units or securities convertible
into or exercisable or exchangeable for Common Units or other rights to purchase
Units or any other securities of the Partnership that are substantially similar
to Common Units or establish or increase a put equivalent position or liquidate
or decrease a call equivalent position within the meaning of Section 16 of the
Exchange Act, or publicly announce an intention to effect any such transaction
for a period of ninety (90) days after the date hereof (the "Lock-Up Period"),
without the prior written consent of UBS Securities LLC, except for (i) the
registration of the Common Units and the sales to the Underwriters pursuant to
this Agreement, (ii) issuances of Units upon the exercise of options or warrants
disclosed as outstanding in the Registration Statement and the Prospectus, and
(iii) the issuance of employee options not exercisable during the Lock-Up Period
pursuant to option plans described in the Registration Statement and the
Prospectus.
(q) not, at any time, directly or indirectly, take any action intended,
or which might reasonably be expected, to cause or result in, which will
constitute, stabilization of the price of the Common Units to facilitate the
sale or resale of any of the Units.
(r) to timely file any financial statements required by Rule 3-05(b)(2)
of Regulation S-X.
5. Reimbursement of Underwriters' Expenses. If the Units are not
delivered for any reason other than the termination of this Agreement pursuant
to the first two paragraphs of Section 8 hereof or the default by one or more of
the Underwriters in its or their respective obligations hereunder, the
Partnership shall, in addition to paying the amounts described in Section 4(m)
hereof, reimburse the Underwriters for all of their out-of-pocket expenses
reasonably incurred, including the fees and disbursements of their counsel;
provided, however, that if this Agreement is terminated pursuant to Section 8 by
reason of the default of one or more Underwriters, the Partnership shall not be
obligated to reimburse any defaulting Underwriter on account of these expenses.
6. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters hereunder are subject to the accuracy of the representations
and warranties on the part of the TEPPCO Entities on the date hereof and at the
time of purchase (and the several obligations of the Underwriters at the
additional time of purchase are subject to the accuracy of the representations
and warranties on the part of the TEPPCO Entities on the date hereof and at
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the time of purchase (unless previously waived) and at the additional time of
purchase, as the case may be, to the accuracy of the statements of the
Partnership made in any certificates pursuant to the provisions hereof, to the
performance by the Partnership of its obligations hereunder and to the following
additional conditions precedent:
(a) The Partnership shall furnish to the Underwriters at the time of
purchase and at the additional time of purchase, as the case may be (i) opinions
of Fulbright & Xxxxxxxx L.L.P., counsel for the Partnership, addressed to the
Underwriters and dated the time of purchase, as set forth in Exhibit B and (ii)
opinions of Xxxxx X. Xxxx, general counsel of the Partnership, addressed to the
Underwriters and dated the time of purchase, as set forth in Exhibit C, with
reproduced copies of each for the other Underwriters and each in a form
satisfactory to Xxxxxx & Xxxxxx L.L.P., counsel for the Underwriters.
(b) The Underwriters shall have received from each of KPMG and PWC a
"comfort letter" and "bring-down comfort letter" dated the date of this
Agreement and the time of purchase or the additional time of purchase, as the
case may be, and addressed to the Underwriters (with reproduced copies for each
of the other Underwriters) in the forms heretofore approved by UBS Securities
LLC.
(c) The Underwriters shall have received at the at the time of purchase
and at the additional time of purchase, as the case may be, the opinions of
Xxxxxx & Xxxxxx L.L.P., counsel for the Underwriters, with respect to the
issuance and sale of the Units, the Registration Statement, the Prospectus and
other related matters as the Underwriters may reasonably require.
(d) No amendment or supplement to the Registration Statement or
Prospectus, including documents deemed to be incorporated by reference therein,
shall be filed prior to the time of purchase or additional time of purchase to
which the Underwriters object in writing.
(e) Notification that all filings required by Rule 424 of the Rules and
Regulations shall have been made.
(f) Prior to the time of purchase and at the additional time of
purchase, as the case may be, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under the
Securities Act or proceedings initiated under Section 8(d) or 8(e) of the
Securities Act; (ii) the Registration Statement and all amendments thereto, or
modifications thereof, if any, shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and (iii) the
Prospectus and all amendments or supplements thereto, or modifications thereof,
if any, shall not contain an untrue statement of material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they are made,
not misleading.
(g) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, (i) no material
adverse change or any development involving a prospective material adverse
change in the business, properties, management, financial condition or results
of operations of the TEPPCO Entities and their subsidiaries taken as a whole
shall occur or become known, (ii) no event shall occur or become known that
could invalidate the Agreement, and (iii) no transaction which is material to
any of
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the TEPPCO Entities or their subsidiaries shall have been entered into by any of
the TEPPCO Entities, except transactions contemplated in this Agreement or in
the ordinary course of business.
(h) The Partnership will, at the time of purchase or additional time of
purchase, as the case may be, deliver to the Underwriters a certificate of two
of the General Partner's executive officers to the effect that the
representations and warranties of the TEPPCO Entities and their subsidiaries set
forth in this Agreement are true and correct as of such date, that the TEPPCO
Entities or their subsidiaries shall perform such of their obligations under
this Agreement as are to be performed at or before the time of purchase, the
conditions set forth in paragraphs (f) and (g) of this Section 6 have been met
and such other matters as the Underwriters may reasonably request.
(i) UBS Securities LLC shall have received signed Lock-Up Agreements
referred to in Section 3(x).
(j) The Partnership shall have furnished to the Underwriters such other
documents and certificates as to the accuracy and completeness of any statement
in the Registration Statement and the Prospectus as of the time of purchase and
the additional time of purchase, as the case may be, as the Underwriters may
reasonably request.
(k) The Units shall have been approved for listing on the New York
Stock Exchange subject only to notice of issuance at or prior to the time of
purchase or the additional time of purchase, as the case may be.
(l) Between the time of execution of this Agreement and the time of
purchase or additional time of purchase, as the case may be, there shall not
have occurred any downgrading, nor shall any notice or announcement have been
given or made of (i) any intended or potential downgrading or (ii) any review or
possible change that does not indicate an improvement, in the rating accorded
any securities of, or securities guaranteed by, the Partnership or any of its
subsidiaries by any "nationally recognized statistical rating organization," as
that term is defined in Rule 436(g)(2) under the Securities Act.
(m) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there shall have been no litigation
or other proceeding instituted against any of the TEPPCO Entities or their
subsidiaries or any of their respective officers or directors in their
capacities as such, before or by any Federal, state or local court, commission,
regulatory body, administrative agency or other governmental body, domestic or
foreign, in which litigation or proceeding an unfavorable ruling, decision or
finding would have a Material Adverse Effect.
(n) Each of the representations and warranties of the Partnership
contained herein shall be true and correct in all material respects at the time
of purchase or the additional time of purchase, as the case may be, as if made
at the time of purchase or the additional time of purchase, as the case may be,
and all covenants and agreements herein contained to be performed on the part of
the Partnership and all conditions herein contained to be fulfilled or complied
with by the Partnership at or prior to the time of purchase or additional time
of purchase, as the case may be, shall have been duly performed, fulfilled or
complied with; provided, however, that if
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any such representation or warranty is already qualified by materiality, for
purposes of determining whether this condition has been satisfied, such
representation or warranty as so qualified must be true and correct in all
respects.
(o) The Units shall be qualified for sale in such states as the
Underwriters may reasonably request, each such qualification shall be in effect
and not subject to any stop order or other proceeding at the time of purchase or
additional time of purchase, as the case may be.
7. Effective Date of Agreement; Termination. This Agreement shall
become effective when the parties hereto have executed and delivered this
Agreement.
The obligations of the several Underwriters hereunder shall be subject
to termination in the absolute discretion of UBS Securities LLC or any group of
Underwriters (which may include UBS Securities LLC) which has agreed to purchase
in the aggregate at least 50% of the Units if, (x) since the time of execution
of this Agreement or the earlier respective dates as of which information is
given in the Registration Statement and Prospectus, there has been any material
adverse change or any development involving a prospective material adverse
change in the business, properties, management, financial condition or results
of operations of the TEPPCO Entities or their subsidiaries taken as a whole,
which would, in your judgment or in the judgment of such group of Underwriters,
make it impracticable or inadvisable to market the Units on the terms and in the
manner contemplated in the Registration Statement and the Prospectus, or (y)
since the time of execution of this Agreement there shall have occurred: (i) a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange, the American Stock Exchange or the NASDAQ; (ii) a
suspension or material limitation in trading in the Partnership's securities on
the New York Stock Exchange; (iii) a general moratorium on commercial banking
activities declared by either federal or New York State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (iv) an outbreak or escalation of hostilities or
acts of terrorism involving the United States or a declaration by the United
States of a national emergency or war; or (v) any other calamity or crisis or
any change in financial, political or economic conditions in the United States
or elsewhere, if the effect of any such event specified in clause (iv) or (v) in
UBS Securities LLC's judgment or in the judgment of such group of Underwriters
makes it impracticable or inadvisable to proceed with the public offering or the
delivery of the Units on the terms and in the manner contemplated in the
Registration Statement and the Prospectus, or (z) since the time of execution of
this Agreement, there shall have occurred any downgrading, or any notice or
announcement shall have been given or made of (i) any intended or potential
downgrading or (ii) any watch, review or possible change that does not indicate
an affirmation or improvement in the rating accorded any securities of or
guaranteed by the Partnership or any of its subsidiaries by any "nationally
recognized statistical rating organization," as that term is defined in Rule
436(g)(2) under the Act.
If UBS Securities LLC or any group of Underwriters elects to terminate
this Agreement as provided in this Section 7, the Partnership and each other
Underwriter shall be notified promptly by letter or telegram.
If the sale to the Underwriters of the Units, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement or if such sale is not carried out because any of the Partnership
shall be unable to comply with any of the terms
-23-
of this Agreement, the Partnership shall not be under any obligation or
liability under this Agreement (except to the extent provided in Sections 4(m),
5 and 9 hereof), and the Underwriters shall be under no obligation or liability
to the Partnership under this Agreement (except to the extent provided in
Section 9 hereof) or to one another hereunder.
8. Increase in Underwriters' Commitments. Subject to Sections 6 and 7,
if any Underwriter shall default in its obligation to take up and pay for the
Units to be purchased by it hereunder (otherwise than for a reason sufficient to
justify the termination of this Agreement under the provisions of Section 7
hereof) and if the number of Units which all Underwriters so defaulting shall
have agreed but failed to take up and pay for does not exceed 10% of the total
number of Units, the non-defaulting Underwriters shall take up and pay for (in
addition to the aggregate number of Units they are obligated to purchase
pursuant to Section 1 hereof) the number aggregate of Units agreed to be
purchased by all such defaulting Underwriters, as hereinafter provided. Such
Units shall be taken up and paid for by such non-defaulting Underwriter or
Underwriters in such amount or amounts as UBS Securities LLC may designate with
the consent of each Underwriter so designated, or in the event no such
designation is made, such Units shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the aggregate number of
Units set opposite the names of such non-defaulting Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Partnership agrees with the non-defaulting Underwriters that it
will not sell any Units hereunder unless all of the Units are purchased by the
Underwriters (or by substituted Underwriters selected by UBS Securities LLC with
the approval of the Partnership or selected by the Partnership with the approval
of UBS Securities LLC.).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Partnership for a defaulting Underwriter or Underwriters
in accordance with the foregoing provision, the Partnership or UBS Securities
LLC shall have the right to postpone the time of purchase for a period not
exceeding five business days in order that any necessary changes in the
Registration Statement and Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 8 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
If the aggregate number of Units which the defaulting Underwriter or
Underwriters agreed to purchase exceeds 10% of the total of Units which all
Underwriters agreed to purchase hereunder, and if neither the non-defaulting
Underwriters nor the Partnership shall make arrangements within the five
business day period stated above for the purchase of all the Units which the
defaulting Underwriter or Underwriters agreed to purchase hereunder, this
Agreement shall be terminated without further act or deed and without any
liability on the part of the Partnership to any non-defaulting Underwriter and
without any liability on the part of any non-defaulting Underwriter to the
Partnership. Nothing in this paragraph, and no action taken hereunder, shall
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
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9. Indemnity and Contribution.
(a) The Partnership agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors, officers, employees, agents and any person
who controls any Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, and the successors and assigns of all the
foregoing persons from and against any loss, damage, expense, liability or claim
(including, but not limited to, the reasonable cost of investigation, legal
representation and other expenses incurred in connection with, and any and all
amounts paid in settlement of, any action, suit or proceeding between any of the
indemnified parties and any indemnifying parties or between any indemnified
party and any third party, or otherwise, or any claim asserted) which, jointly
or severally, any such Underwriter or person may incur under the Securities Act,
the Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Partnership), in a Prospectus (the term
"Prospectus" for the purpose of this Section 9 being deemed to include any
preliminary prospectus filed as part of the Registration Statement, the
Prospectus (as previously defined) and the Prospectus as amended or supplemented
by the Partnership), or arises out of or is based upon any omission or alleged
omission to state a material fact required to be stated in either such
Registration Statement or such Prospectus or necessary to make the statements
made therein not misleading, except insofar as any such loss, damage, expense,
liability or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in and in conformity with
information concerning such Underwriter furnished in writing by or on behalf of
such Underwriter through you to the Partnership expressly for use in such
Registration Statement or such Prospectus or arises out of or is based upon any
omission or alleged omission to state a material fact in connection with such
information required to be stated in such Registration Statement or such
Prospectus or necessary to make such information not misleading, (ii) any untrue
statement or alleged untrue statement made by the Partnership in Section 3
hereof or the failure by the Partnership to perform when and as required any
agreement or covenant contained herein, or (iii) any untrue statement or alleged
untrue statement of any material fact contained in any audio or visual materials
provided by the Partnership or based upon written information furnished by or
with the consent of the Partnership including, without limitation, slides,
videos, films or tape recordings used in connection with the marketing of the
Units; provided, however, that the indemnity agreement contained in this
subsection (a) with respect to any preliminary Prospectus or amended preliminary
Prospectus shall not inure to the benefit of any Underwriter (or to the benefit
of any person controlling such Underwriter) from whom the person asserting any
such loss, damage, expense, liability or claim purchased the Units which is the
subject thereof if the Prospectus corrected any such alleged untrue statement or
omission and if such Underwriter failed to send or give a copy of the Prospectus
to such person at or prior to the written confirmation of the sale of such
Shares to such person, unless the failure is the result of noncompliance by the
Partnership with paragraph (b) of Section 4 hereof. This indemnity agreement
will be in addition to any liability that the Partnership might otherwise have.
If any action, suit or proceeding (together, a "Proceeding") is brought
against an Underwriter or any such person in respect of which indemnity may be
sought against the Partnership pursuant to the foregoing paragraph, such
Underwriter or such person shall promptly notify the General Partner in writing
of the institution of such Proceeding and the Partnership
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shall assume the defense of such Proceeding, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees and
expenses, provided, however, that the omission to so notify the General Partner
(or any omission of notice under Section 9(c)) shall not relieve the Partnership
from any liability which the Partnership may have to any Underwriter or any such
person or otherwise. Such Underwriter or controlling person shall have the right
to employ its or their own counsel in any such case, but the fees and expenses
of such counsel shall be at the expense of such Underwriter or such controlling
person unless the employment of such counsel shall have been authorized in
writing by the General Partner in connection with the defense of such Proceeding
or the Partnership shall not have, within a reasonable period of time in light
of the circumstances, employed counsel to have charge of the defense of such
Proceeding or such indemnified party or parties shall have reasonably concluded
(based on advice of counsel) that there may be defenses available to it or them
which are different from, additional to or in competition with those available
to the Partnership (in which case the Partnership shall not have the right to
direct the defense of such Proceeding on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by the
Partnership and paid as incurred (it being understood, however, that the
Partnership shall not be liable for the expenses of more than one separate
counsel (in addition to any local counsel) in any one Proceeding or series of
related Proceedings in the same jurisdiction representing the indemnified
parties who are parties to such Proceeding). The Partnership shall not be liable
for any settlement of any such claim or Proceeding effected without its written
consent but if settled with the written consent of the General Partner, the
Partnership agrees to indemnify and hold harmless any Underwriter and any such
person from and against any loss or liability by reason of such settlement.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second sentence of this
paragraph, then the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written consent if (i) such
settlement is entered into more than sixty (60) business days after receipt by
such indemnifying party of the aforesaid request, (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement and (iii) such indemnified party shall have
given the indemnifying party at least thirty (30) days' prior notice of its
intention to settle. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened Proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such Proceeding and does not include an admission of fault, culpability or a
failure to act, by or on behalf of such indemnified party.
(b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Partnership, each director and officer and any person who controls
the Partnership within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, and the successors and assigns of all the
foregoing persons from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, jointly or severally,
the Partnership or any such person may incur under the Securities Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in conformity
with information furnished in writing by or on behalf of such Underwriter
through UBS Securities LLC to the Partnership expressly for use with reference
to such
-26-
Underwriter in the Registration Statement (or in the Registration Statement as
amended by any post-effective amendment thereof by the Partnership) or in a
Prospectus (which comprises only such information referred to in the second
paragraph of Section 3(a) of this Agreement), or arises out of or is based upon
any omission or alleged omission to state a material fact in connection with
such information required to be stated in such Registration Statement or such
Prospectus or necessary to make such information not misleading. This indemnity
will be in addition to any liability that each Underwriter might otherwise have;
provided, however, that in no case shall any Underwriter be liable or
responsible for any amount in excess of the underwriting discounts and
commissions received by such Underwriter.
If any Proceeding is brought against the Partnership or any such person
in respect of which indemnity may be sought against any Underwriter pursuant to
the foregoing paragraph, the Partnership or such person shall promptly notify
such Underwriter in writing of the institution of such Proceeding and such
Underwriter shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses; provided, however, that the omission to so
notify such Underwriter (or any omission of notice under Section 9(c)) shall not
relieve such Underwriter, from any liability which such Underwriter may have to
the Partnership or any such person or otherwise. The Partnership or such person
shall have the right to employ its own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of the Partnership or such
person unless the employment of such counsel shall have been authorized in
writing by such Underwriter in connection with the defense of such Proceeding or
such Underwriter shall not have, within a reasonable period of time in light of
the circumstances, employed counsel to have charge of the defense of such
Proceeding or such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different from or
additional to or in conflict with those available to such Underwriter (in which
case such Underwriter shall not have the right to direct the defense of such
Proceeding on behalf of the indemnified party or parties, but such Underwriter
may employ counsel and participate in the defense thereof but the fees and
expenses of such counsel shall be at the expense of such Underwriter), in any of
which events such fees and expenses shall be borne by such Underwriter and paid
as incurred (it being understood, however, that such Underwriter shall not be
liable for the expenses of more than one separate counsel in addition to any
local counsel in any one Proceeding or series of related Proceedings in the same
jurisdiction representing the indemnified parties who are parties to such
Proceeding). Anything in this paragraph to the contrary notwithstanding, no
Underwriter shall be liable for any settlement of any such Proceeding effected
without the written consent of such Underwriter but if settled with the written
consent of such Underwriter, such Underwriter agrees to indemnify and hold
harmless the Partnership and any such person from and against any loss or
liability by reason of such settlement. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second sentence of this paragraph, then the indemnifying
party agrees that it shall be liable for any settlement of any Proceeding
effected without its written consent if (i) such settlement is entered into more
than sixty (60) business days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least thirty (30) days' prior notice of its intention to settle. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened
-27-
Proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
Proceeding.
(c) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 9 in respect of any losses, damages, expenses, liabilities or claims
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Partnership on the one hand and the
Underwriters on the other hand from the offering of the Units or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Partnership
on the one hand and of the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, damages, expenses,
liabilities or claims, as well as any other relevant equitable considerations.
The relative benefits received by the Partnership on the one hand and the
Underwriters on the other shall be deemed to be in the same respective
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Partnership and the underwriting discounts and commissions received by the
Underwriters. The relative fault of the Partnership on the one hand and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue statement or alleged untrue statement of a material
fact or omission or alleged omission relates to information supplied by the
Partnership or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the losses,
claims, damages and liabilities referred to in this subsection shall be deemed
to include any legal or other fees or expenses reasonably incurred by such party
in connection with investigating, preparing to defend or defending any
Proceeding.
(d) The Partnership and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 9 were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Units underwritten by such Underwriter and distributed to the
public were offered to the public exceeds the amount of any damage which such
Underwriter has otherwise been required to pay by reason of such untrue
statement or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The Underwriter's obligations
to contribute pursuant to this Section 9 are several in proportion to their
respective underwriting commitments and not joint.
The indemnity and contribution agreements contained in this Section 9
and the covenants, warranties and representations of the Partnership contained
in this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, its partners, directors,
officers, employees, agents or any person (including each
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partner, officer or director of such person) who controls any Underwriter within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act, or by or on behalf of the Partnership, the directors and officers of the
General Partner or any person who controls any of the Partnership within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
and shall survive any termination of this Agreement or the issuance and delivery
of the Units. The Partnership and each Underwriter agree promptly to notify each
other of the commencement of any Proceeding against it and, in the case of the
Partnership, against any of the General Partner's officers or directors, in
connection with the issuance and sale of the Units, or in connection with the
Registration Statement or Prospectus.
10. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent in
care of UBS Securities LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 00000-0000,
Attention: Syndicate Department and, if to the Partnership, shall be sufficient
in all respects if delivered or sent to the Partnership at the offices of the
General Partner at 0000 Xxxxx Xxxxxxx, X.X. Xxx 0000, Xxxxxxx, Xxxxx 00000-0000,
Attention: Xxxxx X. Xxxx.
11. Governing Law; Construction. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
12. Submission to Jurisdiction. Except as set forth below, no Claim may
be commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Partnership
consents to the jurisdiction of such courts and personal service with respect
thereto. The Partnership hereby consents to personal jurisdiction, service and
venue in any court in which any Claim arising out of or in any way relating to
this Agreement is brought by any third party against UBS Securities LLC or any
indemnified party. Each of UBS Securities LLC and the Partnership (on its behalf
and, to the extent permitted by applicable law, on behalf of its holders and
affiliates) waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. The Partnership agrees that a final
judgment in any such action, proceeding or counterclaim brought in any such
court shall be conclusive and binding upon the Partnership and may be enforced
in any other courts in the jurisdiction of which the Partnership is or may be
subject, by suit upon such judgment.
13. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters and the Partnership and, to the
extent provided in Section 9 hereof, the controlling persons, directors and
officers referred to in such section, and their respective successors, assigns,
heirs, personal representatives and executors and administrators. No other
person, partnership, association or corporation (including a purchaser, as such
purchaser, from any of the Underwriters) shall acquire or have any right under
or by virtue of this Agreement. The term "successors and assigns" as used in
this Agreement shall not include a purchaser, as such purchaser, of Units from
the Underwriters.
-29-
14. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
15. Successors and Assigns. This Agreement shall be binding upon the
Underwriters and the Partnership and its successors and assigns and any
successor or assign of any substantial portion of the Partnership's and any of
the Underwriters' respective businesses and/or assets.
If the foregoing correctly sets forth the understanding among the
Partnership and the Underwriters, please so indicate in the space provided below
for the purpose, whereupon this letter and your acceptance shall constitute a
binding agreement among the Partnership and the Underwriters, severally.
[Signatures to follow]
-30-
Very truly yours,
TEPPCO PARTNERS, L.P.
By: TEXAS EASTERN PRODUCTS
PIPELINE COMPANY, LLC,
its General Partner
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------
Xxxxxxx X. Xxxxxxx
Senior Vice President and
Chief Financial Officer
Accepted and agreed to as of the date first
above written, on behalf of itself and the
Underwriters named in Schedule A
UBS SECURITIES LLC
By: /s/ XXXXXXX XXXXXXXX
----------------------------------------
Name: Xxxxxxx Xxxxxxxx
-------------------------------------
Title: Executive Director
-------------------------------------
By: /s/ XXXXX XXXXX
----------------------------------------
Name: Xxxxx Xxxxx
----------------------------------------
Title: Director
----------------------------------------
Unerwriting Agreement Signature Page
SCHEDULE A
UNDERWRITERS NUMBER OF FIRM UNITS
------------ --------------------
UBS Securites LLC........................................ 1,460,000
Citigroup Global Markets Inc. ........................... 1,250,000
Xxxxxxx, Xxxxx & Co...................................... 835,000
X.X. Xxxxxxx & Sons, Inc................................. 625,000
Wachovia Capital Markets, LLC............................ 540,000
McDonald Investments Inc................................. 290,000
==============
Total............................................... 5,000,000
Schedule A
SCHEDULE B
SIGNIFICANT SUBSIDIARIES
TE Products Pipeline Company, Limited Partnership
TEPPCO Midstream Companies, L.P.
TCTM, L.P.
Jonah Gas Gathering Company
Val Verde Gas Gathering Company, L.P.
TEPPCO Crude Pipeline, L. P.
TEPPCO Seaway, L.P.
TEPPCO Crude Oil, L.P.
Chaparral Pipeline Company, L.P.
Schedule B
SCHEDULE C
PERSONS SUBJECT TO LOCK UP AGREEMENTS
Xxxxxxx X. Xxxxxxx
Xxxx X. Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxx Xxxxxxx
J. Xxxxxxx Xxxxxxxx
Xxxxxxx Xxxx
Xxxx X. XxxXxxxxx
Xxxx X. Xxxxxxxxxxx
Xxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxx X. Xxxx
Xxxxx X. Xxxx
Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxx X. Xxxx
Xxxxxxx X. Xxxxxxxxx
Xxxx X. Xxxxxxxx
X. X. Xxxxxx
Xxxx Energy Corporation
Schedule C
Exhibit B
FORM OF OPINIONS OF ISSUER'S COUNSEL
1. Each of the Partnership, the Operating Partnerships, TEPPCO Crude
Pipeline, L.P., TEPPCO Seaway, L.P., TEPPCO Crude Oil, L.P., Val Verde
and Chaparral Pipeline Company, L.P. has been duly formed and is
validly existing as a limited partnership in good standing under the
Delaware LP Act, with limited partnership, power and authority to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus and, with
respect to the Partnership, to perform its obligations pursuant to the
Underwriting Agreement and to issue, sell and deliver the Units as
contemplated by the Underwriting Agreement.
2. The General Partner has been duly formed and is validly existing as a
limited liability company in good standing under the Delaware LLC Act,
with limited liability company power and authority to own, lease and
operate its properties, to conduct its business and to act as the
general partner of the Partnership, in each case, as described in the
Registration Statement and Prospectus.
3. All of the member interests of the General Partner are duly authorized,
validly issued and nonassessable (except as provided in the Delaware
LLC Act) and are owned of record and, to such counsel's knowledge,
beneficially, by Duke Energy Field Services, L.P. ("DEFS"), free and
clear of (A) any security interest that is perfected solely by the
filing of a financing statement under the UCC in the Office of the
Secretary of State of the State of Delaware and that names DEFS as
debtor or (B) to such counsel's knowledge, any other security interest,
lien, encumbrance, right to purchase or adverse claim.
4. TEPPCO GP has been duly incorporated and is validly existing as a
corporation in good standing under the DGCL, with corporate power and
authority to own, lease and operate its properties, to conduct its
business and to act as the general partner of each of the Operating
Partnerships, in each case as described in the Registration Statement
and the Prospectus.
5. Each of the General Partner, the Partnership, TE Products, TEPPCO
Midstream, TCTM, Chaparral Pipeline Company, L.P., Val Verde, TEPPCO
Crude Oil, L.P., TEPPCO Crude Pipeline, L.P. and TEPPCO Seaway, L.P.
have been duly qualified to do business as a foreign limited
partnership, limited liability company, or corporation, as the case may
be, and is in good standing in the state of Texas.
6. The General Partner is the sole general partner of the Partnership with
a general partner interest in the Partnership of 1.999999%; such
general partner interest is duly authorized by the Partnership
Agreement and is validly issued. The General Partner owns of record
and, to such counsel's knowledge, beneficially owns, such general
partner interest, free and clear of (A) any security interest that is
perfected
Exhibit B-1
solely by the filing of a financing statement under the Uniform
Commercial Code ("UCC") in the Office of the Secretary of State of the
State of Delaware and that names the General Partner as debtor or (B)
to such counsel's knowledge, any other security interest, lien,
encumbrance, right to purchase or adverse claim.
7. TEPPCO GP is the sole general partner of each of the Operating
Partnerships with a general partner interest in each of the Operating
Partnerships of 0.001%; such general partner interests are duly
authorized by the Operating Partnership Agreements, as the case may be,
and are validly issued. TEPPCO GP owns of record and, to such counsel's
knowledge, beneficially owns, such general partner interests, free and
clear of (A) any security interest that is perfected solely by the
filing of a financing statement under the UCC in the Office of the
Secretary of State of the State of Delaware and that names TEPPCO GP as
debtor or (B) to such counsel's knowledge, any other security interest,
lien, encumbrance, right to purchase or adverse claim.
8. The Partnership is the sole limited partner of each of the Operating
Partnerships with a limited partner interest in each of the Operating
Partnerships of 99.999%; such limited partner interests are duly
authorized by the Operating Partnership Agreements and are validly
issued and non-assessable (except as provided in the Delaware LP Act).
The Partnership owns of record and, to such counsel's knowledge,
beneficially owns, such limited partner interests in the Operating
Partnerships, free and clear of (A) any security interest that is
perfected solely by the filing of a financing statement under the UCC
in the Office of the Secretary of State of the State of Delaware and
that names the Partnership as debtor or (B) to such counsel's
knowledge, any other security interest, lien, encumbrance, right to
purchase or adverse claim.
9. All of the capital stock of TEPPCO GP is duly authorized, validly
issued and nonassessable and is owned of record and, to such counsel's
knowledge, beneficially, by the Partnership, free and clear of (A) any
security interest that is perfected solely by the filing of a financing
statement under the UCC in the Office of the Secretary of State of the
State of Delaware and that names the Partnership as debtor or (B) to
such counsel's knowledge, any other security interest, lien,
encumbrance, right to purchase or adverse claim.
10. TEPPCO NGL is the sole general partner of Val Verde with a general
partner interest in Val Verde of 0.001%; such general partner interest
is duly authorized by the agreement of limited partnership of Val
Verde, (the "Val Verde Partnership Agreement") and is validly issued.
TEPPCO NGL owns of record and, to such counsel's knowledge,
beneficially owns, such general partner interests, free and clear of
(A) any security interest that is perfected solely by the filing of a
financing statement under the UCC in the Office of the Secretary of
State of the State of Delaware and that names TEPPCO NGL as debtor or
(B) to such counsel's knowledge, any other security interest, lien,
encumbrance, right to purchase or adverse claim.
Exhibit B-2
11. TEPPCO Midstream is the sole limited partner of Val Verde with a
limited partner interest of 99.999%; such limited partner interest is
duly authorized by the Val Verde Partnership Agreement and is validly
issued and non-assessable (except as provided in the Delaware LP Act).
TEPPCO Midstream owns of record and, to such counsel's knowledge,
beneficially owns, such limited partner interests in Val Verde, free
and clear of (A) any security interest that is perfected solely by the
filing of a financing statement under the UCC in the Office of the
Secretary of State of the State of Delaware and that names TEPPCO
Midstream as debtor or (B) to such counsel's knowledge, any other
security interest, lien, encumbrance, right to purchase or adverse
claim.
12. All of the general partner interests of each of the TCTM Subsidiary
Partnerships are duly authorized, validly issued and owned of record
and, to such counsel's knowledge, beneficially, by TEPPCO Crude GP,
LLC, free and clear of (A) any security interest that is perfected
solely by the filing of a financing statement under the UCC in the
Office of the Secretary of State of the State of Delaware and that
names TEPPCO Crude GP, LLC as debtor or (B) to such counsel's
knowledge, any other security interest, lien, encumbrance, right to
purchase or adverse claim.
13. All of the limited partner interests of each of the TCTM Subsidiary
Partnerships are duly authorized, validly issued and nonassessable
(except as provided in the Delaware LP Act), and are owned of record
and, to such counsel's knowledge, beneficially, by TCTM (or, with
respect to Lubrication Services, L.P., by TEPPCO Crude Oil, L.P. and
with respect to TEPPCO Seaway, L.P., by TEPPCO Crude Pipeline, L.P.),
free and clear of (A) any security interest that is perfected solely by
the filing of a financing statement under the UCC in the Office of the
Secretary of State of the State of Delaware and that names such
respective limited partner as debtor or (B) to such counsel's
knowledge, any other security interest, lien, encumbrance, right to
purchase or adverse claim.
14. All of the general partner interests of each of the Midstream
Subsidiary Partnerships are duly authorized, validly issued and owned
of record and, to such counsel's knowledge, beneficially, by TEPPCO
NGL, free and clear of (A) any security interest that is perfected
solely by the filing of a financing statement under the UCC in the
Office of the Secretary of State of the State of Delaware and that
names TEPPCO NGL as debtor or (B) to such counsel's knowledge, any
other security interest, lien, encumbrance, right to purchase or
adverse claim.
15. All of the limited partner interests of each of the Midstream
Subsidiary Partnerships are duly authorized, validly issued and
nonassessable (except as provided in the Delaware LP Act), and are
owned of record and, to such counsel's knowledge, beneficially, by
TEPPCO Midstream, free and clear of (A) any security interest that is
perfected solely by the filing of a financing statement under the UCC
in the Office of the Secretary of State of the State of Delaware and
that names TEPPCO Midstream as debtor or (B) to such counsel's
knowledge, any other security interest, lien, encumbrance, right to
purchase or adverse claim.
Exhibit B-3
16. All of the member interests of TEPPCO Colorado, LLC are duly
authorized, validly issued and nonassessable (except as provided in the
Delaware LLC Act) and are owned of record and, to such counsel's
knowledge, beneficially, by TEPPCO Midstream, free and clear of (A) any
security interest that is perfected solely by the filing of a financing
statement under the UCC in the Office of the Secretary of State of the
State of Delaware and that names TEPPCO Midstream as debtor or (B) to
such counsel's knowledge, any other security interest, lien,
encumbrance, right to purchase or adverse claim.
17. All of the member interests of TEPPCO NGL are duly authorized, validly
issued and nonassessable (except as provided in the Delaware LLC Act)
and are owned of record and, to such counsel's knowledge, beneficially,
by TEPPCO Midstream, free and clear of (A) any security interest that
is perfected solely by the filing of a financing statement under the
UCC in the Office of the Secretary of State of the State of Delaware
and that names TEPPCO Midstream as debtor or (B) to such counsel's
knowledge, any other security interest, lien, encumbrance, right to
purchase or adverse claim.
18. All of the member interests of TEPPCO Crude GP, LLC are duly
authorized, validly issued and nonassessable (except as provided in the
Delaware LLC Act) and are owned of record and, to such counsel's
knowledge, beneficially, by TCTM, free and clear of (A) any security
interest that is perfected solely by the filing of a financing
statement under the UCC in the Office of the Secretary of State of the
State of Delaware and that names TCTM as debtor or (B) to such
counsel's knowledge, any other security interest, lien, encumbrance,
right to purchase or adverse claim.
19. The Underwriting Agreement has been duly authorized, executed and
delivered by the Partnership.
20. The Units have been duly authorized by the board of directors of the
General Partner and the Partnership Agreement on behalf of the
Partnership and, when issued and delivered to the Underwriters against
payment therefor in accordance with the terms of the Underwriting
Agreement, will be validly issued, fully paid and nonassessable (except
as provided in the Delaware LP Act), and free of any preemptive or, to
the knowledge of such counsel, similar rights that entitle or will
entitle any person to acquire any partnership interest in the
Partnership upon the issuance thereof by the Partnership.
21. To such counsel's knowledge, the Partnership's authorized and
outstanding Common Units are as set forth in the Prospectus; and,
except as set forth in the Prospectus, to such counsel's knowledge, no
options, warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or
exchange any securities for, partnership interests or ownership
interests in the Partnership are outstanding, other than options,
warrants or other rights to purchase, agreements or other obligations
to issue, or rights to convert any obligations into or exchange any
securities for, partnership interests or
Exhibit B-4
ownership interests in the Partnership included or described in the
Partnership Agreement or any employee or non-employee director option
plans, employment agreements and other employment arrangements to which
the Partnership, the General Partner or their affiliates are party with
respect to the Partnership.
22. The Common Units conform in all material respects as to legal matters
to the description thereof set forth under the captions "Cash
Distributions" and "Tax Considerations" in the Prospectus.
23. The form of certificates for the Units conforms in all material
respects to the requirements of the Partnership Agreement.
24. The Registration Statement and all post-effective amendments, if any,
have become effective under the Securities Act and, to such counsel's
knowledge, no stop order proceedings with respect thereto are pending
or threatened under the Securities Act; and any required filing of the
Prospectus and any supplement thereto pursuant to Rule 424 under the
Securities Act has been made in the manner and within the time period
required by such Rule 424.
25. Each of the Partnership Agreement, the Operating Partnership Agreements
and the Val Verde Partnership Agreement has been duly authorized,
executed and delivered by the parties thereto and is a valid and
legally binding agreement of the parties thereto, enforceable against
the parties thereto in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, fraudulent
transfer, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and general principles of equity
and to the extent that rights to indemnity and contribution under the
Partnership Agreement, the Operating Partnership Agreements and the Val
Verde Partnership Agreement may be limited by federal or state
securities laws or the public policy underlying such laws.
26. Neither the offer, sale or delivery of the Units by the Partnership,
the execution, delivery or performance of the Underwriting Agreement,
nor performance by the Partnership of its obligations under the
Underwriting Agreement constitutes or will constitute a breach of, or a
default under, any license, agreement, indenture, mortgage, deed of
trust, bank loan, credit agreement or other evidence of indebtedness,
any lease, contract or other agreement or instrument to which any of
the TEPPCO Entities or any of their subsidiaries is a party or by that
any of them or any of their respective properties is bound or affected,
in each case which has been filed with or incorporated by reference in
the Registration Statement, or will result in the creation or
imposition of any lien, charge or encumbrance under the terms thereof
upon any property or assets of any of the TEPPCO Entities, nor will any
such action result in any violation of (a) the partnership agreement,
member agreement or other organization documents of any of the TEPPCO
Entities or any of their subsidiaries, as the case may be, (b) any
statutory law, regulation, rule or ruling (assuming compliance with all
applicable state securities and blue sky laws), (c) any judgment,
injunction, order or decree of any court, governmental
Exhibit B-5
agency or arbitrator that is known to such counsel as applicable to any
of the TEPPCO Entities, any of their subsidiaries or any of their
respective properties, or (d) any provision of any license, indenture,
mortgage, deed of trust, bank loan, credit agreement or other evidence
of indebtedness, or any lease, contract or other agreement or
instrument to which any of the TEPPCO Entities or any of their
subsidiaries is a party or by which any of them or their respective
properties may be bound or affected, which in each case is either (i)
filed or incorporated by reference as exhibits to the Partnership's
most recently filed Annual Report on Form 10-K or Current Report on
Form 8-K of the Partnership filed with the Commission after December
31, 2002 or (ii) is identified in a certificate (a copy of which has
been furnished to the Underwriters or the Underwriters' counsel) from
an authorized officer of the General Partner as material to the
business, operations or properties of the Partnership and its
subsidiaries, taken as a whole.
27. To such counsel's knowledge, except for Duke Energy Corporation and
certain of its affiliates, each of whom has waived its rights, no
holder of any interest in or security of the Partnership or any other
person has any right to require registration of Units or any other
partnership interest or other security of the Partnership because of
the filing of the Registration Statement or consummation of the
transactions contemplated by the Underwriting Agreement.
28. No approval, authorization, consent, waiver, notice or order of or
filing with, or other action by, any court or governmental authority is
required to be obtained or made by the Partnership or General Partner
by any material statutory law or regulation applicable to it as a
condition to the execution and delivery by the Partnership of the
Underwriting Agreement, the performance by the Partnership of its
obligations under the Underwriting Agreement or the issuance or sale of
the Units by the Partnership as contemplated by the Underwriting
Agreement, the Prospectus and any supplement thereto, other than
registration of the Units under the Securities Act (except we express
no opinion as to any necessary qualification under the state securities
or blue sky laws of the various jurisdictions in which the Units are
being offered by the Underwriters).
29. The Registration Statement, and the Prospectus and any supplements or
amendments thereto (except as to the financial statements and the notes
thereto and schedules and other financial data contained or
incorporated by reference therein, as to which such counsel need
express no opinion) comply as to form in all material respects with the
requirements of the Securities Act.
30. The documents incorporated by reference in the Registration Statement
and Prospectus when they were filed (or, if an amendment with respect
to any such document was filed, when such amendment was filed) with the
Commission, appear on their face to have been appropriately responsive
in all material respects with the requirements of the Exchange Act
(except as to the financial statements and the notes thereto and
schedules and other financial data contained or incorporated by
reference therein, as to which such counsel need express no opinion).
Exhibit B-6
31. Neither the TEPPCO Entities nor any of their subsidiaries is, or will
be upon consummation of the transactions contemplated by the
Underwriting Agreement, an "investment company," or a "promoter" or
"principal underwriter" for, a "registered investment company," as such
terms are defined in the Investment Company Act of 1940, as amended, or
a "public utility company" or a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company," as such
terms are defined in the Public Utility Holding Company Act of 1935, as
amended; none of the Partnership and the TEPPCO Entities is subject to
regulation under the Public Utility Holding Company Act of 1935, as
amended.
32. (32) To such counsel's knowledge, there are no affiliate transactions,
off-balance sheet transactions, contracts, licenses, agreements, leases
or documents of a character that are required to be filed as exhibits
to the Registration Statement or to be summarized or described in the
Registration Statement or Prospectus (or any amendment or supplement
thereto) that have not been so filed, summarized or described.
33. The Units are duly authorized for listing, subject only to official
notice of issuance, on the New York Stock Exchange.
Such counsel shall state that although it has not undertaken, except as
otherwise indicated in such counsel's opinion, to determine independently, and
is not passing upon and does not assume any responsibility for, the accuracy,
completeness or fairness of any of the statements in the Registration Statement
(except as and to the extent stated in paragraphs 22 and 29 above) or any
documents incorporated therein, such counsel has participated in the preparation
of the Registration Statement and the Prospectus, including review and
discussion of the contents thereof (including review and discussion of the
contents of all documents incorporated by reference therein) with officers and
representatives of the General Partner, representatives of the independent
public accountants of the Partnership and representatives of and counsel for the
Underwriters, and based upon this participation, no information has come to such
counsel's attention that has caused such counsel to believe that the
Registration Statement (including the documents incorporated by reference
therein at the time the Registration Statement became effective and as of the
signing of this Underwriting Agreement), or the Prospectus, as of its date and
as of the applicable time of purchase, 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 any amendment
or supplement to the Prospectus, as of its respective date, and as of the
applicable time of purchase, as the case may be, contained any untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading (such counsel need not express any opinion with
respect to the financial statements and the notes thereto and the schedules and
other financial data included in the Registration Statement or the Prospectus or
any documents incorporated by reference therein).
Exhibit X-0
XXXXXXX X
XXXX XX XXXXXXXX XX XXXXX X. XXXX, GENERAL COUNSEL TO THE GENERAL PARTNER
1. Jonah has been duly formed and is validly existing in good standing as
a general partnership under the Wyoming Uniform Partnership Act. All of
the general partner interests of Jonah are duly authorized and are
beneficially owned by TEPPCO GP and TEPPCO Midstream free and clear of
any security interest, lien, encumbrance, right to purchase or other
claim, except as disclosed in the Prospectus or as provided in the
agreement of partnership of Jonah or pursuant to the Wyoming Uniform
Partnership Act (A) in respect of which a financing statement under the
Uniform Commercial Code ("UCC") has been filed in the State of Wyoming
naming TEPPCO GP or TEPPCO Midstream as --- debtor is on file in the
offices of the Secretary of State of the State of Wyoming or (B)
otherwise known to such counsel.
2. To such counsel's knowledge, there are no actions, suits, claims,
investigations or proceedings pending or threatened or contemplated to
which any of the TEPPCO Entities or any of their subsidiaries is
subject or of which any of their respective properties is subject at
law or in equity or before or, by any Federal, state, local or foreign
governmental or regulatory commission, board, body, authority or agency
which are required to be described in the Registration Statement or the
Prospectus (or any amendment or supplement thereto) but are not so
described.
3. To such counsel's knowledge, none of the TEPPCO Entities nor any of
their subsidiaries is in violation of its partnership agreement, member
agreement or other organizational documents, or is in breach of, or in
default under (nor has any event occurred which with notice, lapse of
time, or both would result in any breach of, or constitute a default
under), any license, indenture, mortgage, deed of trust, bank loan or
credit agreement or other evidence of indebtedness, or any lease,
contract or other agreement or instrument to which any of the TEPPCO
Entities or any of their subsidiaries is a party or by which any of
them or their respective properties may be bound or affected or under
any Federal, state, local or foreign law, regulation or rule or any
decree, judgment or order applicable to any of the TEPPCO Entities or
any of their subsidiaries, except where such violation, breach or
default would not, individually or in the aggregate, have a Material
Adverse Effect.
Exhibit C-1
