2,500,000 Common Units
Representing Limited Liability Company Interests
UBS Securities
LLC
Morgan Stanley & Co., Incorporated
as Joint Book-Running Managers
c/o UBS Securities LLC
299 Park Avenue
New York, New York 10171-0026
Copano
Energy, L.L.C., a Delaware limited liability company (the “
Company ”), proposes to issue and sell to the
underwriters named in Schedule A annexed hereto (the
“ Underwriters ”), for whom you are acting as
representatives (the “ Representatives ”), an
aggregate of 2,500,000 units (the “ Firm Units
”) representing common membership interests in the Company
(“ Common Units ”). In addition, solely for the
purpose of covering over-allotments, the Company proposes to grant
to the Underwriters the option to purchase from the Company up to
an additional 375,000 Common Units (the “ Additional
Units ”). The Firm Units and the Additional Units are
collectively referred to herein as the “ Units
.” The Units are described in the Prospectus which is
referred to below.
The
Company conducts its business through Copano Houston Central,
L.L.C., a Delaware limited liability company (“ CHC
”), Copano Pipelines Group, L.L.C., a Delaware limited
liability company (“ CPG ”), Copano/Webb-Duval
Pipeline, L.P., a Delaware limited partnership (“ CWDPL
LP ”), for which Copano/Webb-Duval Pipeline GP, L.L.C., a
Delaware limited liability company (“ CWDPL LLC
”), serves as the general partner, and Copano Energy/Rocky
Mountains and Mid-Continent, L.L.C. (“ CE/RMMC LLC
”). The Company, CHC, CPG, CWDPL LP, CWDPL LLC and CE/RMMC
LLC are collectively referred to herein as the “ Copano
Group .” The Copano Group and their respective direct and
indirect subsidiaries listed on Schedule B hereto (the
“ Subsidiaries ”) are collectively referred to
herein as the “ Copano Entities .”
The
Company has prepared and filed, in accordance with the provisions
of the Securities Act of 1933, as amended, and the rules and
regulations thereunder (collectively, the “ Act
”), with the Securities and Exchange Commission (the “
Commission ”) a registration statement on Form S-3
(File No. 333-138341) under the Act (the “
Registration Statement ”). Amendments to the
Registration Statement, if any, have been similarly prepared and
filed with the Commission in accordance with the Act. The
Registration Statement, as so amended, has become effective under
the Act.
Except
where the context otherwise requires, “ Registration
Statement ,” as used herein, means the Registration
Statement, as amended at each date and time the Registration
Statement becomes effective for purposes of Section 11 of the
Act (the “ Effective Time ”), including
(i) all documents filed as a part thereof or incorporated or
deemed to be incorporated by reference therein, (ii) any
information contained or incorporated by reference in a prospectus
filed with the Commission pursuant to Rule 424(b) under the Act, to
the extent such information is deemed, pursuant to Rule 430B
or Rule 430C under the Act, to be part of the Registration
Statement at the Effective Time, and (iii) any registration
statement filed to register the offer and sale of Units pursuant to
Rule 462(b) under the Act.
The
Company has furnished to you, for use by the Underwriters and by
dealers in connection with the offering of the Units, copies of a
preliminary prospectus supplement, and the
documents
incorporated by reference therein, relating to the Units. Except
where the context otherwise requires, “ Pre-Pricing
Prospectus ,” as used herein, means such preliminary
prospectus supplement dated November 28, 2006, relating to the
Units, in the form so furnished, including the basic prospectus
dated as of November 1, 2006, furnished to you by the Company
and attached to or used with such preliminary prospectus
supplement. Except where the context otherwise requires, “
Basic Prospectus ,” as used herein, means such basic
prospectus furnished to you by the Company and attached to or used
with the Prospectus Supplement (as defined below).
Except
where the context otherwise requires, “ Prospectus
Supplement ,” as used herein, means the final prospectus
supplement dated November 30, 2006, relating to the Units,
filed by the Company with the Commission pursuant to Rule 424(b)
under the Act on or before the second business day after the date
hereof (or such earlier time as may be required under the Act), in
the form furnished by the Company to you for use by the
Underwriters and by dealers in connection with the offering of the
Units.
Except
where the context otherwise requires, “ Prospectus
,” as used herein, means the Prospectus Supplement together
with the Basic Prospectus attached to or used with the Prospectus
Supplement.
“
Permitted Free Writing Prospectuses ,” as used herein,
means the documents listed on Schedule C attached
hereto and each “road show” (as defined in
Rule 433 under the Act), if any, related to the offering of
the Units contemplated hereby that is a “written
communication” (as defined in Rule 405 under the Act)
(each such road show, a “ Road Show ”). The
Underwriters have not offered or sold and will not offer or sell,
without the Company’s consent, any Units by means of any
“free writing prospectus” (as defined in Rule 405
under the Act) that is required to be filed with the Commission
pursuant to Rule 433 under the Act, other than a Permitted
Free Writing Prospectus.
“
Disclosure Package ,” as used herein, means the
Pre-Pricing Prospectus together with the Permitted Free Writing
Prospectuses, if any.
Any
reference herein to the Registration Statement, the Basic
Prospectus, the Pre-Pricing Prospectus, the Prospectus Supplement,
the Prospectus or any Permitted Free Writing Prospectus shall be
deemed to refer to and include the documents, if any, incorporated
by reference, or deemed to be incorporated by reference, therein
(the “ Incorporated Documents ”), including,
unless the context otherwise requires, the documents, if any, filed
as exhibits to such Incorporated Documents. Any reference herein to
the terms “ amend ,” “ amendment
” or “ supplement ” with respect to the
Registration Statement, the Basic Prospectus, the Pre-Pricing
Prospectus, the Prospectus Supplement, the Prospectus or any
Permitted Free Writing Prospectus shall be deemed to refer to and
include the filing of any document (excluding any such documents
“furnished” to the Commission) under the Securities
Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the “ Exchange Act ”)
on or after the initial effective date of the Registration
Statement, or the date of the Basic Prospectus, the Pre-Pricing
Prospectus, the Prospectus Supplement, the Prospectus or such
Permitted Free Writing Prospectus, as the case may be, and deemed
to be incorporated therein by reference.
As
used in this Agreement, “ business day ” shall
mean a day on which the New York Stock Exchange (the “
NYSE ”) is open for business. The terms
“herein,” “hereof,” “hereto,”
“hereinafter” and similar terms, as used in this
Agreement, shall in each case refer to this Agreement as a whole
and not to any particular section, paragraph, sentence or other
subdivision of this Agreement.
2
The
Company and the Underwriters agree as follows:
1. Sale
and Purchase . Upon the basis of the representations and
warranties and subject to the terms and conditions herein set
forth, the Company agrees to issue and sell to the respective
Underwriters and each of the Underwriters, severally and not
jointly, agrees to purchase from the Company the number of Firm
Units set forth opposite the name of each such Underwriter on
Schedule A attached hereto, subject to adjustment in
accordance with Section 8 hereof, in each case at a purchase
price of $56.60 per Unit. The Company is advised by you that the
Underwriters intend (i) to make a public offering of their
respective portions of the Firm Units and (ii) initially to
offer the Firm Units upon the terms set forth in the Prospectus, as
hereinafter defined. You may from time to time increase or decrease
the public offering price after the public offering to such extent
as you may determine.
In
addition, the Company hereby grants to the several Underwriters the
option (the “ Over-Allotment Option ”) to
purchase, and upon the basis of the representations and warranties
and subject to the terms and conditions herein set forth, the
Underwriters shall have the right to purchase, severally and not
jointly, from the Company, 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
Company for the Firm Units. The Over-Allotment Option may be
exercised by the Representatives on behalf of the several
Underwriters at any time and from time to time on or before the
thirtieth day following the date hereof, by written notice to the
Company. Such notice shall set forth the aggregate number of
Additional Units as to which the Over-Allotment Option is being
exercised and the date and time when the Additional Units are to be
delivered (any such date and time being herein referred to as an
“ additional time of purchase ”);
provided , however , that no additional time of
purchase shall be earlier than “the time of purchase”
(as defined below) nor earlier than the second business day after
the date on which the Over-Allotment Option shall have been
exercised nor later than the tenth business day after the date on
which the Over-Allotment Option shall have been exercised. The
number of Additional Units to be sold to each Underwriter shall be
the number that bears the same 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 the
Representatives may determine to eliminate fractional units),
subject to adjustment in accordance with Section 8
hereof.
2.
Payment and Delivery . Payment of the purchase price for the
Firm Units shall be made to the Company by Federal Funds wire
transfer against delivery of certificates for the Firm Units to you
through the facilities of The Depository Trust Company (“
DTC ”) for the respective accounts of the
Underwriters. Such payment and delivery shall be made at or prior
to 11:00 A.M., Houston time, on December 6, 2006 (unless
another time shall be agreed to by you and the Company or unless
postponed in accordance with the provisions of Section 8
hereof). The time at which such payment and delivery are to be made
is hereinafter sometimes called “ the time of purchase
.” Electronic transfer of the Firm Units shall be made to you
at the time of purchase in such names and in such denominations as
you shall specify to the Company.
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 you at the additional time of
purchase in such names and in such denominations as you shall
specify.
Deliveries
of the documents described in Section 6 hereof with respect to
the purchase of the Units shall be made at the offices of Vinson
& Elkins L.L.P., 2500 First City Tower, 1001 Fannin, Houston,
Texas 77002-6760, at or prior to 10:00 A.M., Houston time, on
the date of the closing of the
3
purchase of the
Firm Units or the Additional Units, as the case may be.
3.
Representations and Warranties of the Company . The Company
represents and warrants to and agrees with each of the Underwriters
that:
(a) the
Registration Statement has heretofore become effective under the
Act; no stop order of the Commission preventing or suspending the
use of the Basic Prospectus, the Pre-Pricing Prospectus, the
Prospectus Supplement, the Prospectus or any Permitted Free Writing
Prospectus, or the effectiveness of the Registration Statement, has
been issued, and no proceedings for such purpose have been
instituted or, to the knowledge of the Company, are contemplated by
the Commission;
(b) the
Registration Statement complied when it became effective, complies
as of the date hereof and, as amended or supplemented, at the time
of purchase, each additional time of purchase, if any, and at all
times during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with
Rule 172 under the Act or any similar rule) in connection with
any sale of Units, will comply, in all material respects, with the
requirements of the Act; the conditions to the use of Form S-3 in
connection with the offering and sale of the Units as contemplated
hereby have been satisfied; the Registration Statement constitutes
an “automatic shelf registration statement” (as defined
in Rule 405 under the Act), and, as of the determination date
applicable to the Registration Statement (and any amendment
thereof) and the offering contemplated hereby, the Company is a
“well-known seasoned issuer” as defined in
Rule 405 under the Act; the Company has not received any
notice from the Commission pursuant to Rule 401(g)(2) under
the Act objecting to the use of the “automatic shelf
registration statement” form; the Registration Statement
meets, and the offering and sale of the Units as contemplated
hereby complies with, the requirements of Rule 415 under the
Act (including, without limitation, Rule 415(a)(5)); the
Registration Statement did not, as of the Effective Time or as of
the date and time of execution of this Agreement, 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; the Pre-Pricing Prospectus complied, at the
time it was filed with the Commission, and complies as of the date
hereof, in all material respects with the requirements of the Act;
at no time during the period that begins on the earlier of the date
of the Pre-Pricing Prospectus and the date the Pre-Pricing
Prospectus was filed with the Commission and ends at the time of
purchase did or will the Pre-Pricing Prospectus, as then amended or
supplemented, include an untrue statement of a material fact or
omit 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, and at no time during such period
did or will the Pre-Pricing Prospectus, as then amended or
supplemented, together with any combination of one or more of the
Permitted Free Writing Prospectuses, if any, include an untrue
statement of a material fact or omit 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; the
Basic Prospectus complied or will comply, at the time it was or
will be filed with the Commission, complies as of the date hereof
(if filed with the Commission on or prior to the date hereof) and,
at the time of purchase, each additional time of purchase, if any,
and at all times during which a prospectus is required by the Act
to be delivered (whether physically or through compliance with
Rule 172 under the Act or any similar rule) in connection with
any sale of Units, will comply, in all material respects, with the
requirements of the Act; at no time during the period that begins
on the earlier of the date of the Basic Prospectus and the date the
Basic Prospectus was filed with the Commission and ends at the time
of purchase did or will the Basic Prospectus, as then amended or
supplemented, include an untrue statement of a material fact or
omit 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, and at no time during
4
such period did
or will the Basic Prospectus, as then amended or supplemented,
together with any combination of one or more of the Permitted Free
Writing Prospectuses, if any, include an untrue statement of a
material fact or omit 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; each of the Prospectus
Supplement and the Prospectus will comply, as of the date that it
is filed with the Commission, the date of the Prospectus
Supplement, the time of purchase, each additional time of purchase,
if any, and at all times during which a prospectus is required by
the Act to be delivered (whether physically or through compliance
with Rule 172 under the Act or any similar rule) in connection
with any sale of Units, in all material respects, with the
requirements of the Act (in the case of the Prospectus, including,
without limitation, Section 10(a) of the Act); at no time during
the period that begins on the earlier of the date of the Prospectus
Supplement and the date the Prospectus Supplement is filed with the
Commission and ends at the later of the time of purchase, the
latest additional time of purchase, if any, and the end of the
period during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with
Rule 172 under the Act or any similar rule) in connection with
any sale of Units did or will the Prospectus Supplement or the
Prospectus, as then amended or supplemented, include an untrue
statement of a material fact or omit 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; at no
time during the period that begins on the date of such Permitted
Free Writing Prospectus and ends at the time of purchase did or
will any Permitted Free Writing Prospectus include an untrue
statement of a material fact or omit 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;
provided , however , that the Company makes no
representation or warranty with respect to any statement contained
in the Registration Statement, the Pre-Pricing Prospectus, the
Prospectus or any Permitted Free Writing Prospectus in reliance
upon and in conformity with information concerning an Underwriter
and furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in the Registration
Statement, the Pre-Pricing Prospectus, the Prospectus or such
Permitted Free Writing Prospectus; each Incorporated Document, at
the time such document was filed with the Commission or at the time
such document became effective, as applicable, complied, in all
material respects, with the requirements of the Exchange Act and
did not include an untrue statement of a material fact or omit 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;
(c) prior to the
execution of this Agreement, the Company has not, directly or
indirectly, offered or sold any Units by means of any
“prospectus” (within the meaning of the Act) or used
any “prospectus” (within the meaning of the Act) in
connection with the offer or sale of the Units, in each case other
than the Pre-Pricing Prospectus and any Permitted Free Writing
Prospectus; the Company has not, directly or indirectly, prepared,
used or referred to any Permitted Free Writing Prospectus except in
compliance with Rule 163 or with Rules 164 and 433 under
the Act; assuming that such Permitted Free Writing Prospectus is so
sent or given after the Registration Statement was filed with the
Commission (and after such Permitted Free Writing Prospectus was,
if required pursuant to Rule 433(d) under the Act, filed with the
Commission), the sending or giving, by any Underwriter, of any
Permitted Free Writing Prospectus will satisfy the provisions of
Rule 164 or Rule 433 (without reliance on subsections (b),
(c) and (d) of Rule 164); the conditions set forth
in one or more of subclauses (i) through (iv), inclusive, of
Rule 433(b)(1) under the Act are satisfied, and the Registration
Statement relating to the offering of the Units contemplated
hereby, as initially filed with the Commission, includes a
prospectus that, other than by reason of Rule 433 or
Rule 431 under the Act or as otherwise permitted under the
Act, satisfies the requirements of Section 10 of the Act;
neither the Company nor the Underwriters are disqualified, by
reason of subsection (f) or (g) of Rule 164 under
the Act, from
5
using, in
connection with the offer and sale of the Units, “free
writing prospectuses” (as defined in Rule 405 under the
Act) pursuant to Rules 164 and 433 under the Act; the Company
is not an “ineligible issuer” (as defined in
Rule 405 under the Act) as of the eligibility determination
date for purposes of Rules 164 and 433 under the Act with
respect to the offering of the Units contemplated by the
Registration Statement; the parties hereto agree and understand
that the content of any Road Show is solely the property of the
Company; no Permitted Free Writing Prospectus includes any
information that conflicts with the information contained in the
Registration Statement, including any document incorporated therein
by reference and any prospectus supplement deemed to be a part
thereof that has not been superseded or modified (the foregoing
clause does not apply to statements in or omissions from the
Disclosure Package made in reliance upon and in conformity with
information concerning an Underwriter and furnished in writing by
or on behalf of such Underwriter through you to the Company
expressly for use in a Permitted Free Writing
Prospectus);
(d) each of the
Copano Entities (except for Webb/Duval Gatherers, a Texas general
partnership (“ Webb/Duval ”), with respect to
good standing) has been duly formed and is validly existing in good
standing under the laws of its jurisdiction of formation, and is
duly registered or qualified to do business and is in good standing
as a foreign corporation, limited liability company, limited
partnership or general partnership, as the case may be, in each
jurisdiction in which its ownership or lease of property or the
conduct of its businesses requires such registration or
qualification, except where the failure so to register or qualify
would not, individually or in the aggregate, either (i) have a
material adverse effect on the business, properties, financial
condition, results of operations or prospects of the Copano
Entities taken as a whole, (ii) prevent or materially
interfere with the Company’s ability to consummate the
transactions contemplated hereby or (iii) result in the
delisting of the Common Units from the Nasdaq Stock Market LLC (the
“ NASDAQ ”) (the occurrence of any such effect
or any such prevention or interference or any such result described
in the foregoing clauses (i), (ii) and (iii) being herein
referred to as a “ Material Adverse Effect ”);
each of the Copano Entities has all corporate, limited liability
company, limited partnership or general partnership, as the case
may be, power and authority necessary to own or lease its
properties currently owned or leased or to be owned or leased at
the time of purchase and at each additional time of purchase, if
any, and to conduct its business as currently conducted or to be
conducted at the time of purchase and at each additional time of
purchase, if any, in each case in all material respects as
described in the Registration Statement, the Pre-Pricing
Prospectus, the Prospectus and the Permitted Free Writing
Prospectuses, if any;
(e) CWDPL LLC has
all necessary limited liability company power and authority to act
as general partner of CWDLP LP. Copano Processing GP, L.L.C., a
Delaware limited liability company, has all necessary limited
liability company power and authority to act as general partner of
Copano Processing, L.P., a Texas limited partnership. Copano NGL
Services GP, L.L.C., a Delaware limited liability company, has all
necessary limited liability company power and authority to act as
general partner of Copano NGL Services, L.P., a Texas limited
partnership Copano Field Services GP, L.L.C., a Delaware limited
liability company, has all necessary limited liability company
power and authority to act as general partner of each of Copano
Field Services/Agua Dulce, L.P., Copano Field Services/Copano Bay,
L.P., Copano Field Services/Karnes, L.P., Copano Field
Services/Live Oak, L.P., Copano Field Services/South Texas, L.P.
and Copano Field Services/Upper Gulf Coast, L.P., each of the
foregoing a Texas limited partnership. Copano Pipelines GP, L.L.C.,
a Delaware limited liability company, has all necessary limited
liability company power and authority to act as general partner of
each of Copano Pipelines/Hebbronville, L.P., Copano Pipelines/South
Texas, L.P. and Copano Pipelines/Upper Gulf Coast, L.P., each of
the foregoing a Texas limited partnership. Copano Pipelines (Texas)
GP, L.L.C., a Delaware limited liability company, has all necessary
limited
6
liability
company power and authority to act as general partner of Copano
Pipelines/Texas Gulf Coast, L.P., a Texas limited partnership.
Copano Field Services/Central Gulf Coast GP, L.L.C., a Delaware
limited liability company, has all necessary limited liability
company power and authority to act as general partner of Copano
Field Services/Central Gulf Coast, L.P., a Texas limited
partnership. Copano Energy Services GP, L.L.C., a Delaware limited
liability company, has all necessary limited liability company
power and authority to act as general partner of Copano Energy
Services/Upper Gulf Coast, L.P., a Texas limited partnership.
Copano Energy Services (Texas) GP, L.L.C., a Delaware limited
liability company, has all necessary limited liability company
power and authority to act as general partner of Copano Energy
Services/Texas Gulf Coast, L.P., a Texas limited partnership. CPNO
Services GP, L.L.C., a Delaware limited liability company, has all
necessary limited liability company power and authority to act as
general partner of Copano Risk Management, L.P. and CPNO Services,
L.P., each of the foregoing a Texas limited partnership;
(f) the Company
directly or indirectly owns 100% of the issued and outstanding
capital stock, membership interests or partnership interests, as
the case may be, of the other Copano Entities (excluding Webb/Duval
and Southern Dome, LLC, a Delaware limited liability company
(“ Southern Dome ”), as to which the Company
owns a 62.5% partnership interest and a majority limited liability
company interest, respectively) free and clear of all liens,
encumbrances, security interests, equities, charges and other
claims except for liens created pursuant to the Credit Agreement
dated as of August 1, 2005 among the Company, as the Borrower,
Bank of America, N.A., as Administrative Agent and L/C Issuer,
Comerica Bank and U.S. Bank National Association, as Co-Syndication
Agents, Bank of Scotland and Fortis Capital Corp., as
Co-Documentation Agents, and the other lenders party thereto and
Banc of America Securities LLC, as Sole Lead Arranger and Sole Book
Manager, as amended by First Amendment to Credit Agreement, dated
as of January 26, 2006, and Second Amendment to Credit
Agreement, dated as of September 20, 2006, or the Loan
Agreement dated as of September 29, 2006 among the Company, as
the Borrower, Banc of America Bridge LLC, as Administrative Agent
and the other lenders party thereto and Banc of America Securities
LLC, as Sole Lead Arranger and Sole Book Manager (collectively, the
“ Credit Agreements ”); such capital stock,
limited liability company interests or partnership interests, as
the case may be, have been duly authorized and validly issued and
are fully paid (to the extent required under such
Subsidiary’s applicable constituent documents) and
non-assessable (except as such nonassessability may be affected by:
(A) Section 18-607 of the Delaware Limited Liability
Company Act (the “ Delaware LLC Act ”), in the
case of a Delaware limited liability company,
(B) Section 17-607 of the Delaware Revised Uniform
Limited Partnership Act (the “ Delaware LP Act
”), in the case of a Delaware limited partnership, or
(C) Sections 3.03, 5.02 and 6.07 of the Texas Revised Uniform
Limited Partnership Act (the “ Texas LP Act ”),
in the case of a Texas limited partnership;
(g) other than its
ownership interests in the other Copano Entities, the Company does
not own and at the time of purchase and at each additional time of
purchase, if any, will not own, directly or indirectly, any equity
or long-term debt securities of any corporation, partnership,
limited liability company, joint venture, association or other
entity that, individually or in the aggregate, would be deemed to
be a “significant subsidiary” as such term is defined
in Rule 405 of the Securities Act;
(h) at the time of
purchase and at each additional time of purchase, if any, the Firm
Units or the Option Units, as the case may be, and the limited
liability company interests represented thereby, will be duly
authorized in accordance with the Second Amended and Restated
Limited Liability Company Agreement of the Company (the “
Limited Liability Company Agreement ”) and, when
issued and delivered against payment therefor in
accordance
7
with this
Agreement, will be validly issued, fully paid (to the extent
required under the Limited Liability Company Agreement) and
non-assessable (except as such nonassessability may be affected by
Section 18-607 of the Delaware LLC Act);
(i) except as
described in the Registration Statement, the Pre-Pricing Prospectus
and the Prospectus or in the organizational documents of the Copano
Entities, there are no preemptive rights or other rights to
subscribe for or to purchase, nor any restriction upon the voting
or transfer of, any equity securities in any of the Copano
Entities, except for rights granted to the partners of Webb/Duval
Gatherers and the members of Southern Dome pursuant to their
respective constituent documents; neither the filing of the
Registration Statement nor the offering or sale of the Units as
contemplated by this Agreement gives rise to any rights for or
relating to the registration of any Units or other securities of
any of the Copano Entities other than as have been waived or deemed
waived. Except as described in the Registration Statement, the
Pre-Pricing Prospectus and the Prospectus and except for options
granted pursuant to the Company’s employee benefit or other
compensation plans since the date of the Company’s most
recently filed proxy statement pursuant to Section 14(a) of the
Exchange Act, there are no outstanding options or warrants to
purchase any membership or partnership interests in or capital
stock of any of the Copano Entities;
(j) as of the date
of the Pre-Pricing Prospectus and the Prospectus, the Company has
14,874,457 Common Units and 3,519,126 subordinated units
representing subordinated membership interests (“
Subordinated Units ”) issued and outstanding; as of
the date of this Agreement and as of the date of the time of
purchase and any additional time of purchase, as the case may be,
the Company has or will have, as the case may be, on the historical
and as adjusted basis indicated in the Pre-Pricing Prospectus and
the Prospectus, a capitalization as set forth therein under the
heading “Capitalization,” subject, in each case, to
(i) the issuance of Common Units upon the exercise of options
disclosed as outstanding in the Registration Statement, the
Pre-Pricing Prospectus and the Prospectus and (ii) the
issuance of Common Units pursuant to the Company’s long-term
incentive plan on or after November 16, 2006;
(k) the Company
has all requisite limited liability company power and authority to
issue, sell and deliver the Units, in accordance with and upon the
terms and conditions set forth in this Agreement, the Limited
Liability Company Agreement, the Registration Statement, the
Pre-Pricing Prospectus and the Prospectus; at the time of purchase
and at each additional time of purchase, if any, all limited
liability company action required to be taken by the Company or any
of its unitholders for the authorization, issuance, sale and
delivery of the Units and the consummation of the transactions
contemplated by this Agreement shall have been validly
taken;
(l) this Agreement
has been duly authorized and validly executed and delivered by the
Company and constitutes the valid and legally binding agreement of
the Company, enforceable against the Company in accordance with its
terms; provided , however , that the enforceability
hereof may be limited by (i) bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws
relating to or affecting creditors’ rights generally and by
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law)
and (ii) public policy, applicable law relating to fiduciary
duties and indemnification and an implied covenant of good faith
and fair dealing;
(m) the Limited
Liability Company Agreement has been duly authorized, executed and
delivered by affiliates of the Company’s management and,
assuming due authorization, execution and delivery by the other
parties thereto, is a valid and legally binding agreement of each
of the parties thereto, enforceable against each of them in
accordance with its terms;
8
provided , however , that the enforceability
hereof may be limited by (i) bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws relating to
or affecting creditors’ rights generally and by general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and
(ii) public policy, applicable law relating to fiduciary
duties and indemnification and an implied covenant of good faith
and fair dealing;
(n) the
certificate of incorporation, certificate of formation, bylaws,
limited liability company agreement, limited partnership agreement
or other organizational documents, as applicable, of the Copano
Entities (excluding the Company) (collectively, the “
Subsidiary Operating Agreements ” and, together with
the Limited Liability Company Agreement, the “ Operating
Agreements ”) have been duly authorized, executed and
delivered by the Copano Entities parties thereto, as applicable,
and are valid and legally binding agreements of the respective
parties thereto, enforceable against the respective parties thereto
in accordance with their terms;
(o) none of the
offering, issuance and sale by the Company of the Units, the
execution, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby or thereby
(i) conflicts or will conflict with or constitutes or will
constitute a violation of any of the Operating Agreements,
(ii) conflicts or will conflict with or constitutes or will
constitute a breach or violation of, or a default under (or an
event which, with notice or lapse of time or both, would constitute
such a default), any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which any of
the Copano Entities is a party or by which any of them or any of
their respective properties may be bound, (iii) violates or
will violate any statute, law or regulation or any order, judgment,
decree or injunction of any court or governmental agency or body
having jurisdiction over any of the Copano Entities or any of their
respective properties in a proceeding to which any of them or their
property is or was a party, or (iv) results or will result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of any of the Copano Entities (other than liens
created pursuant to the Credit Agreements), which conflicts,
breaches, violations, defaults or liens, in the case of clauses
(ii), (iii) or (iv), would have, individually or in the
aggregate, a Material Adverse Effect;
(p) except for
(i) such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities or “Blue Sky” laws in
connection with the purchase and distribution of the Units by the
Underwriters, (ii) such consents that have been, or prior the
time of purchase will be, obtained and (iii) such consents
that, if not obtained, would not, individually or in the aggregate,
have a Material Adverse Effect, no consent, approval, authorization
or order of, or filing or registration with, any court or
governmental agency or body having jurisdiction over any of the
Copano Entities or any of their respective properties is required
in connection with the offering, issuance and sale by the Company
of the Units, the execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the
transactions contemplated by this Agreement;
(q) none of the
Copano Entities (i) is in violation of its applicable
Operating Agreement, (ii) is in default (and no event has
occurred which, with notice or lapse of time or both, would
constitute such a default) in the due performance or observance of
any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which it is a party or by which it is bound or to
which any of its properties or assets is subject or (iii) is
in violation of any law, statute, ordinance, administrative or
governmental rule or regulation applicable to it or of any order,
judgment, decree or injunction of any court or governmental agency
or body having jurisdiction over it, which default or
9
violation in
the case of clause (ii) or (iii), would, if continued, have a
Material Adverse Effect, or could materially impair the ability of
the Company to perform its obligations under this Agreement; to the
knowledge of the Company without independent investigation, no
third party to any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which any of the
Copano Entities is a party or by which any of them is bound or to
which any of their properties is subject, is in default under any
such agreement, which default would, if continued, have a Material
Adverse Effect;
(r) the Units,
when issued and delivered in accordance with the terms of the
Limited Liability Company Agreement against payment therefor as
provided herein, will conform in all material respects to the
descriptions thereof contained or incorporated by reference in the
Registration Statement, the Pre-Pricing Prospectus, the Prospectus
and any Permitted Free Writing Prospectus;
(s) subsequent to
the respective dates as of which information is given in the
Registration Statement, the Pre-Pricing Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, in
each case excluding any amendments or supplements to the foregoing
made after the execution of this Agreement, 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 the
Copano Entities taken as a whole, (ii) any transaction which
is material to the Copano Entities taken as a whole, (iii) any
obligation or liability, direct or contingent (including any
off-balance sheet obligations), incurred by any of the Copano
Entities, which is material to the Copano Entities taken as a
whole, (iv) any change in the capital stock or outstanding
indebtedness of any of the Copano Entities or (v) any dividend
or distribution of any kind declared, paid or made on the capital
stock of any of the Copano Entities;
(t) the historical
consolidated financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement
or included or incorporated by reference in the Pre-Pricing
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
(and any amendment or supplement thereto) present fairly in all
material respects the financial condition and results of operations
of the entities purported to be shown thereby on the basis stated
therein, at the dates and for the periods indicated, and have been
prepared in conformity with U.S. generally accepted accounting
principles applied on a consistent basis throughout the periods
involved; the summary historical and pro forma consolidated
financial and operating information set forth or incorporated by
reference in the Registration Statement, the Pre-Pricing
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
(and any amendment or supplement thereto) is presented fairly in
all material respects and prepared on a basis consistent with the
audited and unaudited historical consolidated financial statements
and pro forma financial statements, as applicable, from which it
has been derived; the unaudited pro forma financial statements of
the Company included or incorporated by reference in the
Registration Statement, the Pre-Pricing Prospectus, the Prospectus
or any Permitted Free Writing Prospectus (and any amendment or
supplement thereto) have been prepared in all material respects in
accordance with the applicable requirements of Article 11 of
Regulation S-X of the Act; the assumptions used in the preparation
of such unaudited pro forma financial statements are, in the
opinion of the management of the Company, reasonable; the pro forma
adjustments reflected in such unaudited pro forma financial
statements have been properly applied to the historical amounts in
compilation of such unaudited pro forma financial statements; the
other financial and statistical data contained or incorporated by
reference in the Registration Statement, the Pre-Pricing
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
are accurately and fairly presented and prepared on a basis
consistent with the financial statements and books and
10
records of the
Company; there are no financial statements (historical or pro
forma) that are required to be included or incorporated by
reference in the Registration Statement, the Pre-Pricing Prospectus
or the Prospectus that are not included or incorporated by
reference as required; the Copano Entities do not have any material
liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not described in the Registration
Statement (excluding the exhibits thereto), the Pre-Pricing
Prospectus and the Prospectus; and all disclosures contained or
incorporated by reference in the Registration Statement, the
Pre-Pricing Prospectus, the Prospectus or any Permitted Free
Writing Prospectus regarding “non-GAAP financial
measures” (as such term is defined by the rules and
regulations of the Commission) comply with Regulation G of the
Exchange Act and Item 10 of Regulation S-K under the Act,
to the extent applicable;
(u) each of
Deloitte & Touche LLP, which expressed its opinion with respect
to certain financial statements of the Company included or
incorporated by reference in the Registration Statement, the
Pre-Pricing Prospectus and Prospectus (or any amendment or
supplement thereto), and Grant Thornton LLP, which expressed its
opinion with respect to certain financial statements of ScissorTail
Energy, LLC, a Delaware limited liability company (“
ScissorTail ”), included or incorporated by reference
in the Registration Statement, the Pre-Pricing Prospectus and
Prospectus (or any amendment or supplement thereto), is, or was at
the time of such opinion with respect to the financial statements,
an independent registered public accounting firm within the meaning
of Regulation S-X under the Securities Act and the Exchange
Act and the rules of the Public Company Accounting Oversight
Board;
(v) each of the
Copano Entities has good and marketable title to all real property
and good title to all personal property described in the
Registration Statement, the Pre-Pricing Prospectus, the Prospectus
or any Permitted Free Writing Prospectus and any document
incorporated by reference therein as owned by such Copano Entity,
free and clear of all (i) liens and security interests except liens
or security interests arising under or securing indebtedness
incurred under the Credit Agreements or (ii) other claims and
other encumbrances (other than liens or security interests) except,
in each case, (1) as described, and subject to the limitations
contained, in the Registration Statement, the Pre-Pricing
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
and any document incorporated by reference therein, (2) such
as do not materially affect the value of such property taken as a
whole or (3) such as do not materially interfere with the use
of such properties taken as a whole as they have been used in the
past and are proposed to be used in the future as described in the
Registration Statement, the Pre-Pricing Prospectus, the Prospectus
or any Permitted Free Writing Prospectus; provided ,
however , that, with respect to any real property and
buildings held under lease by any of the Copano Entities, such real
property and buildings are held under valid and subsisting and
enforceable leases with such exceptions as do not materially
interfere with the use of the properties of the Copano Entities
taken as a whole as they have been used in the past as described in
the Registration Statement, the Pre-Pricing Prospectus, the
Prospectus and any Permitted Free Writing Prospectus and are
proposed to be used in the future as described in the Registration
Statement, the Pre-Pricing Prospectus, the Prospectus and any
Permitted Free Writing Prospectus;
(w) the Copano
Entities maintain insurance covering their properties, operations,
personnel and businesses against such losses and risks and in such
amounts as is reasonably adequate for the conduct of their
respective businesses and the value of their respective properties
and as is customary for companies engaged in similar businesses in
similar industries; none of the Copano Entities has received notice
from any insurer or agent of such insurer that substantial capital
improvements (relating to the Company and its subsidiaries on a
consolidated basis) or other substantial expenditures will have to
be made in order to continue such insurance, and all such insurance
is outstanding and duly in force on the date hereof and will be
outstanding and
11
duly in force
at the time of purchase and at each additional time of purchase, if
any;
(x) there are no
actions, suits, claims, investigations or proceedings pending or,
to the knowledge of the Company, threatened or contemplated to
which the Company or any of the Copano Entities is or would be a
party or of which any of its properties is or would be subject at
law or in equity, before or by any federal, state, local or foreign
governmental or regulatory commission, board, body, authority or
agency, or before or by any self-regulatory organization or other
non-governmental regulatory authority (including, without
limitation, the NASDAQ) that are required to be described in the
Registration Statement, the Pre-Pricing Prospectus, the Prospectus
or any Permitted Free Writing Prospectus but are not described as
required or that, if resolved adversely to any of the Copano
Entities, would, individually or in the aggregate, have a Material
Adverse Effect;
(y) there are no
agreements, contracts, indentures, leases or other instruments that
are required to be described in the Registration Statement, the
Pre-Pricing Prospectus, the Prospectus or any Permitted Free
Writing Prospectus or to be filed as exhibits to the Registration
Statement by the Act that have not been described or filed as
required;
(z) no labor
dispute with the employees of any of the Copano Entities exists or,
to the knowledge of the Company, is imminent or threatened that is
reasonably likely to have a Material Adverse Effect;
(aa) no
relationship, direct or indirect, exists between or among any of
the Copano Entities, on the one hand, and the directors, officers,
members, partners, unitholders, customers or suppliers of any of
the Copano Entities, on the other hand, that is required to be
described in the Registration Statement, the Pre-Pricing
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
that is not so described; there are no outstanding loans, advances
(except normal advances for business expenses in the ordinary
course of business) or guarantees of indebtedness by any of the
Copano Entities to or for the benefit of any of the officers or
directors of any of the Copano Entities or their respective family
members, except as disclosed in the Registration Statement, the
Pre-Pricing Prospectus, the Prospectus or any Permitted Free
Writing Prospectus; none of the Copano Entities has, in violation
of the Sarbanes-Oxley Act of 2002, directly or indirectly, extended
or maintained credit, arranged for the extension of credit, or
renewed an extension of credit, in the form of a personal loan to
or for any director or executive officer of any of the Copano
Entities;
(bb) the Company
and its officers and directors are in compliance in all material
respects with all applicable provisions of the Sarbanes-Oxley Act
of 2002 and the applicable rules and regulations
thereunder;
(cc) each of the
Copano Entities has filed (or has obtained extensions with respect
to) all material federal, state and local income and franchise tax
returns required to be filed through the date of this Agreement,
which returns are correct and complete in all material respects,
and has timely paid all taxes due thereon, other than those
(i) that are being contested in good faith and for which
adequate reserves have been established in accordance with
generally accepted accounting principles or (ii) that, if not
paid, would not have a Material Adverse Effect;
(dd) each of the
Copano Entities (i) makes and keeps books and records which,
in reasonable detail, accurately and fairly reflect the
transactions and dispositions of assets and (ii) maintains
internal accounting controls sufficient to provide reasonable
assurance that (A) transactions are executed in accordance
with management’s general or specific authorization,
(B)
12
transactions
are recorded as necessary to permit preparation of its financial
statements in conformity with generally accepted accounting
principles and to maintain accountability for its assets,
(C) access to its assets is permitted only in accordance with
management’s general or specific authorization and
(D) the reported accountability for its assets is compared
with existing assets at reasonable intervals and appropriate action
is taken with respect to any differences;
(ee) the Company
has established and maintains disclosure controls and procedures
(as such term is defined in Rule 13a-15 under the Exchange
Act), which (i) are designed to ensure that material
information relating to the Company, including its consolidated
subsidiaries, is made known to the Company’s principal
executive officer and its principal financial officer by others
within those entities, particularly during the periods in which the
periodic reports required under the Exchange Act are being
prepared; (ii) have been evaluated for effectiveness as of the
end of the period covered by the Company’s most recent
quarterly report filed with the Commission; and (iii) are
effective in all material respects to perform the functions for
which they were established;
(ff) based on the
evaluation of its internal controls and procedures as of the end of
the period covered by the Company’s most recent quarterly
report filed with the Commission, the Company is not aware of
(i) any significant deficiency in the design or operation of
internal controls that could adversely affect the Company’s
ability to record, process, summarize and report financial data or
any material weaknesses in internal controls; or (ii) any fraud,
whether or not material, that involves management or other
employees who have a significant role in the Company’s
internal controls;
(gg) since the end
of the period covered by the Company’s most recent quarterly
report filed with the Commission, 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, except for improvements and new procedures implemented
as part of the Company’s review of its internal
controls;
(hh) each of the
Copano Entities owns or possesses all inventions, patent
applications, patents, trademarks (both registered and
unregistered), tradenames, service names, copyrights, trade secrets
and other proprietary information described in the Registration
Statement, the Pre-Pricing Prospectus, the Prospectus or any
Permitted Free Writing Prospectus as being owned or licensed by it
or which is necessary for the conduct of, or material to, its
businesses (collectively, the “ Intellectual Property
”), and the Company is unaware of any claim to the contrary
or any challenge by any other person to the rights of the Copano
Entities with respect to the Intellectual Property; none of the
Copano Entities has infringed or is infringing the intellectual
property of a third party, and none of the Copano Entities has
received notice of a claim by a third party to the
contrary;
(ii) the Copano
Entities (i) are in compliance with any and all applicable
federal, state and local laws and regulations relating to the
protection of human health and safety and the environment or
imposing liability or standards of conduct concerning any Hazardous
Materials (as defined below) (“ Environmental Laws
”), (ii) have received all permits required of them
under applicable Environmental Laws to conduct their respective
businesses, (iii) are in compliance with all terms and
conditions of any such permits and (iv) do not have any
liability in connection with the release into the environment of
any Hazardous Material, except where such noncompliance with
Environmental Laws, failure to receive required permits, failure to
comply with the terms and conditions of such permits or liability
would not, individually or in the aggregate, have a Material
Adverse Effect; the term “ Hazardous Material ”
means (A) any “hazardous substance” as defined in
the Comprehensive Environmental Response, Compensation
13
and Liability
Act of 1980, as amended, (B) any “hazardous waste”
as defined in 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;
(jj) each of the
Copano Entities has, and at the time of purchase and at each
additional time of purchase, if any, will have, such permits,
consents, licenses, franchises, certificates and authorizations of
governmental or regulatory authorities (“ permits
”) as are necessary to own its properties and to conduct its
business in the manner described in the Registration Statement, the
Pre-Pricing Prospectus, the Prospectus and any Permitted Free
Writing Prospectus, subject to such qualifications as may be set
forth therein and except for such permits which, if not obtained,
would not, individually or in the aggregate, have a Material
Adverse Effect; except as set forth in the Registration Statement,
the Pre-Pricing Prospectus, the Prospectus and any Permitted Free
Writing Prospectus, each of the Copano Entities has, or at the time
of purchase and at each additional time of purchase, if any, will
have, fulfilled and performed all its material obligations with
respect to such permits which are or will be due to have been
fulfilled and performed by such date and no event has occurred that
would prevent the permits from being renewed or reissued or which
allows, or after notice or lapse of time would allow, revocation or
termination thereof or results in any impairment of the rights of
the holder of any such permit, except for such non-renewals,
non-issues, revocations, terminations and impairments that would
not, individually or in the aggregate, have a Material Adverse
Effect; and, except as described in the Registration Statement, the
Pre-Pricing Prospectus, the Prospectus and any Permitted Free
Writing Prospectus, none of such permits contains, or at the
applicable time of purchase will contain, any restriction that is
materially burdensome to the Copano Entities considered as a
whole;
(kk) the Copano
Entities have not distributed and, prior to the later to occur of
(i) the time of purchase and (ii) completion of the
distribution of the Units, will not distribute, any prospectus (as
defined under the Act) in connection with the offering and sale of
the Units other than the Registration Statement, the Pre-Pricing
Prospectus, the Prospectus and any Permitted Free Writing
Prospectus, in each case as contemplated by this
Agreement;
(ll) the Company
has filed a supplemental listing application with the Nasdaq Stock
Market LLC covering the Units;
(mm) none of the
Copano Entities is now, and after the sale of the Uni
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