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Exhibit 1.1
EXECUTION
COPY
4,450,000 Common
Units
NUSTAR ENERGY
L.P.
Representing Limited
Partner Interests
UNDERWRITING
AGREEMENT
March 27, 2008
GOLDMAN, SACHS & CO.
WACHOVIA CAPITAL MARKETS, LLC
As Representatives of the
several
Underwriters named in Schedule I
attached hereto,
c/o Goldman, Sachs &
Co.
85 Broad Street
New York, New York 10004
Ladies and Gentlemen:
NuStar Energy L.P., a
Delaware limited partnership (the “ Partnership
”), proposes to issue and sell an aggregate of 4,450,000
common units (the “ Firm Units ”), each
representing limited partner interests in the Partnership (the
“ Common Units ”). In addition, the Partnership
proposes to grant to the underwriters (the “
Underwriters ”) named in Schedule I attached to this
agreement (this “ Agreement ”) an option to
purchase up to an aggregate of 667,500 additional Common Units on
the terms and for the purposes set forth in Section 2 (the
“ Option Units ”). The Firm Units and the Option
Units, if purchased, are hereinafter collectively called the
“ Offered Units .”
This is to confirm the
agreement among the Partnership, Riverwalk Logistics, L.P., a
Delaware limited partnership and the general partner of the
Partnership (the “ General Partner ”), NuStar
GP, LLC, a Delaware limited liability company and the general
partner of the General Partner (“ NuStar GP ”),
NuStar Logistics, L.P., a Delaware limited partnership (“
NuStar Logistics ”), NuStar GP, Inc., a Delaware
corporation and the general partner of NuStar Logistics (“
GP, Inc. ”), Kaneb Pipe Line Operating Partnership,
L.P., a Delaware limited partnership (“ KPOP ”),
and Kaneb Pipe Line Company, LLC, a Delaware limited liability
company and the general partner of KPOP (“ Kaneb GP
”), and the Underwriters concerning the purchase of the
Offered Units from the Partnership by the Underwriters. The
Partnership, the General Partner, NuStar GP, NuStar Logistics, GP,
Inc., KPOP and Kaneb GP are collectively referred to herein as the
“ Partnership Parties .”
A. It is understood and
agreed to by all parties hereto that NuStar GP Holdings, LLC, a
Delaware limited liability company (“ NuStar Holdings
”), owns as of the Initial Delivery Date (as defined in
Section 3 hereof):
(i) a 2% general partner
interest in the Partnership, held indirectly through a 100%
indirect ownership interest in the General Partner;
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(ii) 10,213,894 Common Units
held indirectly through a 100% ownership interest in Riverwalk
Holdings, LLC, a Delaware limited liability company (“
Riverwalk Holdings ”);
(iii) 6,416 Common Units held
indirectly through a 100% ownership interest in NuStar GP;
and
(iv) all of the incentive
distribution rights in the Partnership (the “Incentive
Distribution Rights”), held indirectly through a 100%
ownership interest in the General Partner;
each as more particularly described in
the Preliminary Prospectus and the Prospectus (as such terms are
hereinafter defined).
B. It is further understood
and agreed to by all parties hereto that as of the date hereof the
Partnership owns:
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(i) |
a 99.99% limited partner interest in NuStar
Logistics; |
(ii) a 0.01% general partner
interest in NuStar Logistics, indirectly held through its 100%
ownership interest in GP, Inc.;
(iii) a 99% limited partner
interest in Kaneb Pipe Line Partners, L.P., a Delaware limited
partnership (“ KPP ”);
(iv) a 1% general partner
interest in KPP, indirectly held through a 100% indirect ownership
interest in Kaneb GP;
(v) a 100% membership
interest in Kaneb GP and the general partner of KPP and KPOP, as
hereinafter defined, held indirectly through a 100% membership
interest in Kaneb Services, LLC, a Delaware limited liability
company and sole member of Kaneb GP (“ Kaneb Services
”);
(vi) a 100% ownership
interest in KPOP (together with KPP, Kaneb GP and Kaneb Services,
the “ Kaneb OLP Entities ”), held indirectly
through KPP and Kaneb GP; and
(vii) a 100% ownership
interest in each of the subsidiaries listed on Schedule II hereto,
except as otherwise indicated on Schedule II (collectively, the
“ Operating Subsidiaries ” and each individually
an “ Operating Subsidiary ”), held, directly or
indirectly, through either of NuStar Logistics or KPOP.
NuStar GP, Riverwalk
Holdings, the Partnership, the General Partner, NuStar Logistics,
GP, Inc. and the Kaneb OLP Entities are collectively referred to
herein as the “ Partnership Entities
.”
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C. Prior to the execution
hereof:
(i) CITGO Asphalt Refining
Company, a New Jersey general partnership, and NuStar Asphalt
Refining, LLC, a Delaware limited liability company and wholly
owned subsidiary of the Partnership (“ NuStar Asphalt
”), entered into a Sale and Purchase Agreement dated
November 5, 2007 (the “ CARCO Purchase Agreement
”);
(ii) NuStar Logistics, the
Partnership and KPOP entered into a 5-Year Revolving Credit
Agreement dated as of December 10, 2007 with JPMorgan Chase
Bank, N.A., as Administrative Agent, Suntrust Bank, as Syndication
Agent, Barclays Bank PLC and Mizuho Corporate Bank Ltd., as
Co-Documentation Agents, and the Lenders party thereto;
and
(iii) NuStar Logistics and
the Partnership entered into a Term Loan Credit Agreement dated as
of February 1, 2008 with JPMorgan Chase Bank, N.A., as
Administrative Agent, Suntrust Bank, as Syndication Agent, Barclays
Bank PLC and Wachovia Bank, National Association, as
Co-Documentation Agents, and the Lenders party thereto.
The “ Organizational
Documents ” shall mean the NuStar GP LLC Agreement, the
Riverwalk Holdings LLC Agreement, the GP Partnership Agreement, the
Partnership Agreement, the NuStar Logistics Partnership Agreement,
the Kaneb Services LLC Agreement, the Kaneb GP LLC Agreement, the
KPP Partnership Agreement and the KPOP Partnership Agreement (as
such terms are defined in Section 1 hereof).
The Partnership Parties wish
to confirm as follows their agreement with you in connection with
the purchase of the Offered Units from the Partnership by the
Underwriters.
1. Representations,
Warranties and Agreements of the Partnership Parties. Each of
the Partnership Parties represents, warrants and agrees
that:
(a) Registration;
Definitions; No Stop Order . A registration statement
(Registration No. 333-143095) on Form S-3 relating to the
Offered Units has (i) been prepared by the Partnership in
conformity with the requirements of the Securities Act of 1933, as
amended (the “ Securities Act ”), and the rules
and regulations (the “ Rules and Regulations
”) of the Securities and Exchange Commission
(the “ Commission ”) promulgated
thereunder; (ii) been filed with the Commission under the
Securities Act; and (iii) become effective under the
Securities Act. Copies of such registration statement and any
amendment thereto have been delivered or otherwise made available
by the Partnership to you as the representatives of the
Underwriters (the “ Representatives ”). As used
in this Agreement:
(i) “ Applicable
Time ” means 7:00 a.m. (New York City time) on
March 28, 2008;
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(ii) “ Effective
Date ” means any date as of which any part of such
registration statement relating to the Offered Units became, or is
deemed to have become, effective under the Securities Act in
accordance with the Rules and Regulations;
(iii) “ Issuer Free
Writing Prospectus ” means each “free writing
prospectus” (as defined in Rule 405 of the Rules and
Regulations) prepared by or on behalf of the Partnership or used or
referred to by the Partnership in connection with the offering of
the Offered Units;
(iv) “ Preliminary
Prospectus ” means any preliminary prospectus relating to
the Offered Units included in such registration statement or filed
with the Commission pursuant to Rule 424(b) of the Rules and
Regulations, including any preliminary prospectus supplement
thereto relating to the Offered Units;
(v) “ Pricing
Disclosure Package ” means, as of the Applicable Time,
the most recent Preliminary Prospectus, together with each Issuer
Free Writing Prospectus set forth on Schedule IV hereto and the
information set forth on Schedule V hereto;
(vi) “
Prospectus ” means the final prospectus relating to
the Offered Units, including any prospectus supplement thereto
relating to the Offered Units, as filed with the Commission
pursuant to Rule 424(b) of the Rules and Regulations;
and
(vii) “ Registration
Statement ” means, collectively, the various parts of
such registration statement, each as amended as of the Effective
Date for such part, including any Preliminary Prospectus or the
Prospectus and all exhibits to such registration
statement.
Any reference to any
Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include any documents incorporated by reference therein
pursuant to Form S-3 under the Securities Act as of the date of
such Preliminary Prospectus or the Prospectus, as the case may be.
Any reference to the “ most recent Preliminary
Prospectus ” shall be deemed to refer to the latest
Preliminary Prospectus included in the Registration Statement or
filed pursuant to Rule 424(b) on or prior to the date hereof. Any
reference to any amendment or supplement to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and
include any document filed under the Securities Exchange Act of
1934, as amended (the “ Exchange Act ”), after
the date of such Preliminary Prospectus or the Prospectus, as the
case may be, and incorporated by reference in such Preliminary
Prospectus or the Prospectus, as the case may be; and any reference
to any amendment to the Registration Statement shall be deemed to
include, for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Offered Units, any
reports of the Partnership filed with the Commission pursuant to
Sections 13(a), 13(c) or 15(d) of the Exchange Act after the
Effective Date that is incorporated by reference in the
Registration Statement. The Commission has not issued any order
preventing or suspending the use of any Preliminary Prospectus or
the Prospectus or suspending the effectiveness of the Registration
Statement, and no proceeding or examination for such purpose has
been instituted or threatened by the Commission. The Commission has
not notified the Partnership of any objection to the use of the
form of the Registration Statement.
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(b) Partnership Status as
“Well-Known Seasoned Issuer.” The Partnership has
been since the time of initial filing of the Registration Statement
and continues to be a “well-known seasoned issuer” (as
defined in Rule 405) eligible to use Form S-3 for the offering of
the Offered Units, including not having been an “ineligible
issuer” (as defined in Rule 405) at any such time or date.
The Registration Statement is an “automatic shelf
registration statement” (as defined in Rule 405) and was
filed not earlier than the date that is three years prior to the
applicable Delivery Date (as defined in Section 3
hereof).
(c) Registration Statement
and Prospectus Conform to the Requirements of the Securities
Act . The Registration Statement conformed when filed and, on
the Effective Date and on the applicable Delivery Date, will
conform in all material respects, and any amendment to the
Registration Statement filed after the date hereof will conform in
all material respects when filed, to the requirements of the
Securities Act and the Rules and Regulations. The Preliminary
Prospectus conformed when filed, and the Prospectus will conform,
in all material respects when filed with the Commission pursuant to
Rule 424(b) and on the applicable Delivery Date, to the
requirements of the Securities Act and the Rules and Regulations.
The documents incorporated by reference in any Preliminary
Prospectus or the Prospectus conformed, and any further documents
so incorporated will conform, when filed with the Commission, in
all material respects to the requirements of the Exchange Act or
the Securities Act, as applicable, and the rules and regulations of
the Commission thereunder.
(d) No Material
Misstatements or Omissions in Registration Statement . The
Registration Statement did not, as of each Effective Date, contain
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; provided that no
representation or warranty is made as to information contained in
or omitted from the Registration Statement in reliance upon and in
conformity with written information furnished to the Partnership
through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein, which information is specified
in Section 7(e).
(e) No Material
Misstatements or Omissions in Prospectus . The Prospectus will
not, as of its date and on the applicable Delivery Date, contain an
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;
provided that no representation or warranty is made as to
information contained in or omitted from the Prospectus in reliance
upon and in conformity with written information furnished to the
Partnership through the Representatives by or on behalf of any
Underwriter specifically for inclusion therein, which information
is specified in Section 7(e).
(f) No Material
Misstatements or Omissions in Documents Incorporated by
Reference. The documents incorporated by reference in any
Preliminary Prospectus or the Prospectus did not, and any further
documents filed and incorporated by reference therein will not,
when filed with the Commission, contain an 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.
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(g) No Material
Misstatements or Omissions in Pricing Disclosure Package . The
Pricing Disclosure Package did not, as of the Applicable Time,
contain an 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; provided that no representation or warranty is
made as to information contained in or omitted from the Pricing
Disclosure Package in reliance upon and in conformity with written
information furnished to the Partnership through the
Representatives by or on behalf of any Underwriter specifically for
inclusion therein, which information is specified in
Section 7(e).
(h) No Material
Misstatements or Omissions in Issuer Free Writing Prospectuses
. Each Issuer Free Writing Prospectus (including, without
limitation, any road show that constitutes a free writing
prospectus under Rule 433), when considered together with the
Pricing Disclosure Package as of the Applicable Time, (i) did
not contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading and (ii) did not conflict
with the information then contained in the Registration
Statement.
(i) Issuer Free Writing
Prospectuses Conform to the Requirements of the Securities Act
. Each Issuer Free Writing Prospectus conformed or will conform in
all material respects to the requirements of the Securities Act and
the Rules and Regulations on the date of first use, and the
Partnership has complied with all prospectus delivery requirements
and any filing and record keeping requirements applicable to such
Issuer Free Writing Prospectus pursuant to the Rules and
Regulations. The Partnership has not made any offer relating to the
Offered Units that would constitute an Issuer Free Writing
Prospectus without the prior consent of the Representatives. The
Partnership has retained in accordance with the Rules and
Regulations all Issuer Free Writing Prospectuses that were not
required to be filed pursuant to the Rules and Regulations. The
Partnership has taken all actions necessary so that any “road
show” (as defined in Rule 433 of the Rules and Regulations)
in connection with the offering of the Offered Units will not be
required to be filed pursuant to the Rules and
Regulations.
(j) Formation and
Qualification . Each of the Partnership Entities has been duly
organized and is validly existing and in good standing as a limited
partnership, limited liability company or corporation, as
applicable, under the laws of its jurisdiction of organization and
is duly qualified to do business and in good standing as a foreign
limited partnership, foreign limited liability company or foreign
corporation, as applicable, in each jurisdiction in which its
ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so
qualified or in good standing would not, and except where the
failure of the Partnership Entities to be so duly organized would
not, (i) in the aggregate, reasonably be expected to have a
material adverse effect on the condition (financial or otherwise),
results of operations, unitholders’ or stockholders’
equity, properties, business or prospects of the Partnership and
its subsidiaries (as defined in Rule 405) taken as a whole (a
“ Material Adverse Effect ”); or
(ii) subject the partners of the Partnership to any material
liability or disability; and each of the Partnership Entities has
all power and authority necessary to own or hold its properties and
to conduct the businesses in which it is engaged in all material
respects as described in the Pricing Disclosure Package.
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(k) Ownership of Riverwalk
Holdings by NuStar Holdings. NuStar Holdings is the sole member
of Riverwalk Holdings and owns 100% of the issued and outstanding
membership interests in Riverwalk Holdings; such membership
interests have been duly authorized and validly issued in
accordance with the limited liability company agreement of
Riverwalk Holdings (the “ Riverwalk Holdings LLC
Agreement ”), and are fully paid (to the extent required
under the Riverwalk Holdings LLC Agreement) and nonassessable
(except as such nonassessability may be affected by matters
described in Section 18-607 of the Delaware Limited Liability
Company Act (the “ Delaware LLC Act ”)); and
NuStar Holdings owns such membership interests free and clear of
all liens, encumbrances, security interests, charges or
claims.
(l) Ownership of NuStar GP
by NuStar Holdings. NuStar Holdings is the sole member of
NuStar GP and owns 100% of the issued and outstanding membership
interests in NuStar GP; such membership interests have been duly
authorized and validly issued in accordance with the limited
liability company agreement of NuStar GP (the “ NuStar GP
LLC Agreement ”), and are fully paid (to the extent
required under the NuStar GP LLC Agreement) and nonassessable
(except as such nonassessability may be affected by matters
described in Section 18-607 of the Delaware LLC Act); and
NuStar Holdings owns such membership interests free and clear of
all liens, encumbrances, security interests, charges or
claims.
(m) Ownership of the
General Partner Interest in the General Partner . NuStar GP is
the sole general partner of the General Partner with a 0.1% general
partner interest in the General Partner; such general partner
interest has been duly authorized and validly issued in accordance
with the limited partnership agreement of the General Partner (the
“ GP Partnership Agreement ”); and NuStar GP
owns such general partner interest free and clear of all liens,
encumbrances, security interests, charges or claims.
(n) Ownership of the
Limited Partner Interests in the General Partner . Riverwalk
Holdings is the sole limited partner of the General Partner with a
99.9% limited partner interest in the General Partner; such limited
partner interest has been duly authorized and validly issued in
accordance with the GP Partnership Agreement and is fully paid (to
the extent required under the GP Partnership Agreement) and
nonassessable (except as such nonassessability may be affected by
matters described in Section 17-607 of the Delaware LP Revised
Uniform Limited Partnership Act (the “ Delaware LP Act
”)); and Riverwalk Holdings owns such limited partner
interest free and clear of all liens, encumbrances, security
interests, charges or claims.
(o) Ownership of the
General Partner Interest and Incentive Distribution Rights in the
Partnership . The General Partner is the sole general partner
of the Partnership with a 2% general partner interest and 100% of
the Incentive Distribution Rights in the Partnership; such general
partner interest and Incentive Distribution Rights have been duly
authorized and validly issued in accordance with the limited
partnership agreement of the Partnership (the “
Partnership Agreement ”) and, in the case of
the
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Incentive Distribution
Rights, are fully paid (to the extent required under the
Partnership Agreement) and nonassessable (except as such
nonassessability may be affected by matters described in
Section 17-607 of the Delaware LP Act); and the General
Partner owns such general partner interest and Incentive
Distribution Rights, in each case, free and clear of all liens,
encumbrances, security interests, charges or claims.
(p) Ownership of the
Partnership’s Common Units by NuStar Holdings. Riverwalk
Holdings and NuStar GP, direct wholly owned subsidiaries of NuStar
Holdings, own 10,213,894 and 6,416 Common Units, respectively, in
the Partnership; such limited partner interests have been duly
authorized and validly issued in accordance with
the Partnership Agreement and are fully paid (to the extent
required under the Partnership Agreement) and nonassessable (except
as such nonassessability may be affected by matters described in
Section 17-607 of the Delaware LP Act); and Riverwalk Holdings
and NuStar GP own such limited partner interests free and clear of
all liens, encumbrances, security interests, charges or
claims.
(q) Ownership of GP, Inc.
by the Partnership . The Partnership owns 100% of the issued
and outstanding capital stock of GP, Inc.; such shares of capital
stock have been duly authorized and validly issued in accordance
with the certificate of incorporation and bylaws of GP, Inc., as
amended to date, and are fully paid and nonassessable; and the
Partnership owns such shares of capital stock free and clear of all
liens, encumbrances, security interests, charges or
claims.
(r) Ownership of the
General Partner Interest in NuStar Logistics . GP, Inc. is the
sole general partner of NuStar Logistics with a 0.01% general
partner interest in NuStar Logistics; such general partner interest
has been duly authorized and validly issued in accordance with the
limited partnership agreement of NuStar Logistics (the “
NuStar Logistics Partnership Agreement ”); and GP,
Inc. owns such general partner interest free and clear of all
liens, encumbrances, security interests, charges or
claims.
(s) Ownership of the
Limited Partner Interest in NuStar Logistics. The Partnership
is the sole limited partner of NuStar Logistics with a 99.99%
limited partner interest in NuStar Logistics; such limited partner
interest has been duly authorized and validly issued in accordance
with the NuStar Logistics Partnership Agreement and is fully paid
(to the extent required under the NuStar Logistics Partnership
Agreement) and nonassessable (except as such nonassessability may
be affected by matters described in Section 17-607 of the
Delaware LP Act); and the Partnership owns such limited partner
interest free and clear of all liens, encumbrances, security
interests, charges or claims.
(t) Ownership of Kaneb
Services by the Partnership . The Partnership is the sole
member of Kaneb Services and owns 100% of the issued and
outstanding membership interests in Kaneb Services; such membership
interests have been duly authorized and validly issued in
accordance with the limited liability company agreement of Kaneb
Services (the “ Kaneb Services LLC Agreement ”),
and are fully paid (to the extent required under the Kaneb Services
LLC Agreement) and nonassessable (except as such nonassessability
may be affected by matters described in Section 18-607 of the
Delaware LLC Act); and the Partnership owns such membership
interests free and clear of all liens, encumbrances, security
interests, charges or claims.
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(u) Ownership of Kaneb
GP . Kaneb Services, a wholly owned subsidiary of the
Partnership, is the sole member of Kaneb GP and owns 100% of the
issued and outstanding membership interests in Kaneb GP; such
membership interests have been duly authorized and validly issued
in accordance with the limited liability company agreement of Kaneb
GP (the “ Kaneb GP LLC Agreement ”), and are
fully paid (to the extent required under the Kaneb GP LLC
Agreement) and nonassessable (except as such nonassessability may
be affected by matters described in Section 18-607 of the
Delaware LLC Act); and Kaneb Services owns such membership
interests free and clear of all liens, encumbrances, security
interests, charges or claims.
(v) Ownership of the
General Partner Interest in KPP . Kaneb GP is the sole general
partner of KPP with a 1% general partner interest in KPP; such
general partner interest has been duly authorized and validly
issued in accordance with the limited partnership agreement of KPP
(the “ KPP Partnership Agreement ”); and Kaneb
GP owns such general partner interest free and clear of all liens,
encumbrances, security interests, charges or claims.
(w) Ownership of the
Limited Partner Interest in KPP . The Partnership is the sole
limited partner of KPP with a 99% limited partner interest in KPP;
such limited partner interest has been duly authorized and validly
issued in accordance with the KPP Partnership Agreement and is
fully paid (to the extent required under the KPP Partnership
Agreement) and nonassessable (except as such nonassessability may
be affected by matters described in Section 17-607 of the
Delaware LP Act); and the Partnership owns such limited partner
interest free and clear of all liens, encumbrances, security
interests, charges or claims.
(x) Ownership of the
General Partner Interest in KPOP . Kaneb GP is the sole general
partner of KPOP with a 1% general partner interest in KPOP; such
general partner interest has been duly authorized and validly
issued in accordance with the limited partnership agreement of KPOP
(the “ KPOP Partnership Agreement ”); and Kaneb
GP owns such general partner interest free and clear of all liens,
encumbrances, security interests, charges or claims.
(y) Ownership of the
Limited Partner Interest in KPOP . KPP is the sole limited
partner of KPOP with a 99% limited partner interest in KPOP; such
limited partner interest has been duly authorized and validly
issued in accordance with the KPOP Partnership Agreement and is
fully paid (to the extent required under the KPOP Partnership
Agreement) and nonassessable (except as such nonassessability may
be affected by matters described in Section 17-607 of the
Delaware LP Act); and KPP owns such limited partner interest free
and clear of all liens, encumbrances, security interests, charges
or claims.
(z) Ownership of the
Operating Subsidiaries . Except as set forth on
Schedule II hereto, each of NuStar Logistics and KPOP, as
applicable, owns 100% of the
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outstanding capital stock,
membership interests or partnership interests, as the case may be,
in each of the Operating Subsidiaries; such stock, membership
interests or partnership interests have been duly authorized and
validly issued in accordance with the applicable certificate of
incorporation and bylaws, certificate of formation and limited
liability company agreement or certificate of limited partnership
and partnership agreement of each Operating Subsidiary, as the case
may be (collectively, the “ Operating Subsidiaries
Operative Documents ” and, as to each individual
Operating Subsidiary, the “ Operating Subsidiary Operative
Document ”), except where the failure of such stock,
membership interests or partnership interests to be so duly
authorized and validly issued would not, individually or in the
aggregate, have a Material Adverse Effect, and, except in the case
of the general partner interests, are fully paid (to the extent
required under the applicable Operating Subsidiary Operative
Document) and nonassessable (except as such nonassessability may be
affected by matters described in Section 18-607 of the
Delaware LLC Act or Section 17-607 of the Delaware LP Act, as
the case may be); and each of NuStar Logistics and KPOP, as
applicable, own all such stock, membership interests or partnership
interests, as the case may be, free and clear of all liens,
encumbrances, security interests, charges or claims (collectively,
“ Liens ”).
(aa) No Other
Subsidiaries . The Partnership does not own or control,
directly or indirectly, any corporation, association or other
entity other than the subsidiaries listed on Schedule II hereto.
None of the subsidiaries of the Partnership (other than NuStar
Logistics, KPOP, NuStar Asphalt, Support Terminals Operating
Partnership, L.P., a Delaware limited partnership (“
STOP ”) and Shore Terminals LLC, a Delaware limited
liability company (“ Shore Terminals ”)) is a
“ significant subsidiary ” (as defined in Rule
405).
(bb) Capitalization.
At the Initial Delivery Date, the issued and outstanding Common
Units of the Partnership will consist of 53,859,749 Common Units,
except for any issuances of Common Units since December 31,
2007 under the NuStar GP, LLC Second Amended and Restated 2000
Long-Term Incentive Plan.
(cc) Valid Issuance of
Firm Units. At each Delivery Date, the Firm Units or the Option
Units, as the case may be, and the limited partner interests
represented thereby will be duly authorized by the Partnership and,
when issued and delivered to the Underwriters against payment
therefor in accordance with the terms hereof, will be validly
issued, fully paid (to the extent required under the Partnership
Agreement) and nonassessable (except as such nonassessability may
be affected by matters described in Section 17-607 of the
Delaware LP Act and as otherwise disclosed in the
Prospectus).
(dd) No Preemptive Rights,
Registration Rights or Options . Except as identified in the
most recent Preliminary Prospectus and the Prospectus, there are no
(i) preemptive rights or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of, any
equity securities of the Partnership Parties; or
(ii) outstanding options or warrants to purchase any
securities of the Partnership Parties. Neither the filing of the
Registration Statement nor the offering or sale of the Offered
Units as contemplated by this Agreement gives rise to any rights
for or relating to the registration of any Common Units or other
securities of the Partnership Parties.
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(ee) Authority and
Authorization . At each Delivery Date, all corporate,
partnership and limited liability company action, as the case may
be, required to be taken by any of the Partnership Entities or any
of their respective unitholders, stockholders, members or partners
for the authorization, sale and delivery of the Offered Units, the
execution and delivery of the Organizational Documents and the
consummation of the transactions contemplated by this Agreement,
shall have been validly taken.
(ff) Authorization,
Execution and Delivery of this Agreement . This Agreement has
been duly authorized and validly executed and delivered by each of
the Partnership Parties.
(gg) Authorization,
Execution, Delivery and Enforceability of Certain Agreements .
At or before the Initial Delivery Date, the Organizational
Documents will have been duly authorized, executed and delivered by
the Partnership Entities party thereto and, assuming the due
authorization, valid execution and delivery by the other parties
thereto, each will be a valid and legally binding agreement of the
Partnership Entities party thereto, enforceable against such
parties in accordance with its terms; provided that , with
respect to each agreement described in this Section 1(gg), the
enforceability thereof may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws
relating to or affecting creditors’ rights generally and by
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
provided further ; that the indemnity, contribution and
exoneration provisions contained in any of such agreements may be
limited by applicable laws and public policy.
(hh) No Conflicts .
None of the offering and sale by the Partnership of the Offered
Units, the execution, delivery and performance of this Agreement by
the Partnership Parties and the Organizational Documents by the
Partnership Entities that are parties thereto or the consummation
of any other transactions contemplated by this Agreement or the
Organizational Documents (i) conflicts with or will conflict
with, or constitutes or will constitute a violation of, the
certificate of limited partnership or agreement of limited
partnership, certificate of formation or limited liability company
agreement, the charter or bylaws, or any other organizational
documents of any of the Partnership Entities, (ii) conflicts
with or will conflict with, or constitutes or will constitute a
breach or violation of, or a default (or an event that, with notice
or lapse of time or both, would constitute such a default) under,
any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which any of the Partnership
Entities is a party or by which any of them are bound or to which
any of their respective properties is subject, (iii) violates
or will violate any statute, law, rule or regulation, or any
judgment, order or decrees of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over any of the Partnership Entities
or any of their properties or assets, or (iv) will result in
the creation or imposition of any Lien upon any property or assets
of any of the Partnership Entities, except, in the case of clauses
(ii), (iii) and (iv), for such conflicts, breaches,
violations, defaults, Liens, charges or encumbrances as would not,
individually or in the aggregate, have a Material Adverse Effect,
or could materially impair the ability of any of the Partnership
Entities to perform their respective obligations under this
Agreement.
11
(ii) No Consents . No
permit, consent, approval, authorization, order, registration,
filing or qualification of or with any court, governmental agency
or body is required in connection with the execution and delivery
of this Agreement by the Partnership Parties, except for
(i) such permits, consents, approvals and similar
authorizations required under the Securities Act, the Securities
Exchange Act of 1934, as amended (the “ Exchange Act
”) and state securities or “Blue Sky” laws,
(ii) such consents that have been, or prior to the Delivery
Date will be, obtained, (iii) such consents that, if not
obtained, would not have a Material Adverse Effect and (iv) as
disclosed in the most recent Preliminary Prospectus and the
Prospectus.
(jj) No Defaults .
None of the Partnership Entities is in (i) violation of its
agreement of limited partnership, limited liability company
agreement, certificate of incorporation or bylaws or other
organizational documents, or of any law, statute, ordinance,
administrative or governmental rule or regulation applicable to it
or of any decree of any court or governmental agency or body having
jurisdiction over it or (ii) breach or default (or an event
which, with notice or lapse of time or both, would constitute such
an event) in the performance of any term, covenant or condition
contained in any bond, debenture, note or any other evidence of
indebtedness or in any agreement, indenture, lease or other
instrument to which it is a party or by which it or any of its
properties is subject which breach, default or violation would, if
continued, have a Material Adverse Effect or could materially
impair the ability of any of the Partnership Entities to perform
their respective obligations under this Agreement.
(kk) Conformity of Common
Units to Description in the most recent Preliminary Prospectus and
Prospectus . The Common Units conform in all material respects
to the description thereof contained in the most recent Preliminary
Prospectus and Prospectus.
(ll) No Integration .
None of the Partnership Parties has sold or issued any securities
that would be integrated with the offering of the Offered Units
contemplated by this Agreement pursuant to the Securities Act, the
Rules and Regulations or the interpretations thereof by the
Commission.
(mm) No Material Adverse
Change . None of the Partnership Entities has sustained, since
the date of the latest audited financial statements included in the
most recent Preliminary Prospectus and the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, and since
such date, there has not been any change in the capitalization or
long-term debt of any of the Partnership Entities or any adverse
change, or any development involving a prospective adverse change,
in or affecting the condition or otherwise, results of operations,
unitholders’ or stockholders’ equity, properties,
management, business or prospects of any of the Partnership
Entities taken as a whole, in each case except as would not, in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
12
Since the date of the latest
audited financial statements included in the most recent
Preliminary Prospectus and the Prospectus, none of the Partnership
Entities has incurred any liability or obligation, direct, indirect
or contingent, or entered into any transactions not in the ordinary
course of business, that, individually or in the aggregate, is
material to any of the Partnership Entities, taken as a whole,
otherwise than as set forth or contemplated in the most recent
Preliminary Prospectus and the Prospectus.
(nn) Conduct of
Business . Since the date as of which information is given in
the most recent Preliminary Prospectus and the Prospectus, none of
the Partnership Entities have (i) incurred any liability or
obligation, direct or contingent, other than liabilities and
obligations that were incurred in the ordinary course of business,
(ii) entered into any material transaction not in the ordinary
course of business or (iii) declared, paid or made any
dividend or distribution on any class of security, except in the
ordinary course consistent with past practice.
(oo) Financial
Statements . The historical financial statements (including the
related notes) included in the most recent Preliminary Prospectus
and the Prospectus (and any amendment or supplement thereto) comply
as to form in all material respects with the requirements of
Regulation S-X under the Securities Act and present fairly the
financial condition, results of operations and cash flows of the
entities purported to be shown thereby at the dates and for the
periods indicated and have been prepared in conformity with
accounting principles generally accepted in the United States
applied on a consistent basis throughout the periods involved. The
summary historical and financial data included or incorporated by
reference in the most recent Preliminary Prospectus and the
Prospectus (and any amendment or supplement thereto) under the
captions “Summary – NuStar Energy Summary Consolidated
Historical Financial and Operating Data,” “Ratio of
Earnings to Fixed Charges,” “Capitalization,”
“Selected Financial Data” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” are accurately presented in all material respects
and prepared on a basis consistent with the audited and unaudited
historical consolidated financial statements from which such data
has been derived.
(pp) Statistical and
Market-Related Data . The financial, statistical and
market-related data included or incorporated by reference under the
captions “Summary – Recent Developments,”
“Risk Factors,” “Management’s Discussion
and Analysis of Financial Condition and Results of
Operations” and “Business, Risk Factors and
Properties” in the most recent Preliminary Prospectus and the
Prospectus and the consolidated financial statements of the
Partnership and its subsidiaries included in the most recent
Preliminary Prospectus and the Prospectus are based on or derived
from sources that the Partnership believes to be reliable and
accurate in all material respects and the Partnership has obtained
the written consent to the use of such data from such sources to
the extent required.
(qq) Independent
Registered Public Accounting Firm . KPMG LLP, who has certified
certain financial statements of the Partnership and its
consolidated subsidiaries, whose reports appear in the most recent
Preliminary Prospectus and the Prospectus and who has delivered the
initial letter referred to in Section 6(g) hereof, is an
independent
13
registered public accounting
firm as required by the Securities Act and the Rules and
Regulations was an independent registered public accounting firm as
required by the Securities Act and the Rules and Regulations during
the periods covered by the financial statements on which they
reported contained in the most recent Preliminary Prospectus and
the Prospectus.
(rr) Title to
Properties . At each Delivery Date, each of the Partnership
Parties will have good and indefeasible title to all real property
and good and marketable title to all personal property described in
the most recent Preliminary Prospectus and the Prospectus as being
owned by them, in each case free and clear of all liens,
encumbrances and defects, except (i) such as are described in
the most recent Preliminary Prospectus and the Prospectus and
(ii) 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 most
recent Preliminary Prospectus and the Prospectus; all real property
and buildings held under lease or license by the Partnership
Entities are held by them under valid and subsisting and
enforceable leases or licenses with such exceptions 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 to be used in the
future as described in the most recent Preliminary Prospectus and
the Prospectus. For purposes of this Agreement, the phrase
“good and indefeasible title” to all real property
shall mean, with respect to any real property interest, and subject
to the terms, conditions, and provisions contained in the realty
deeds and leases creating such real property interest, that the
ownership, rights, possession and title in the jurisdiction and
locale where the real property interest is located, is in each case
legally sufficient in all material respects to conduct the business
and operations of the Partnership Entities as described or
incorporated by reference in the Preliminary Prospectus and the
Prospectus under the caption “Business, Risk Factors and
Properties,” as such business and operations relate to the
location of such real property interest, and is free and clear of
all liens, claims, security interests or other encumbrances
excepting (in each case) permitted encumbrances, such title
defects, and imperfections, limitations, correlative rights, or
appurtenant rights or obligations contained in, arising from or
created by the instrument under which any of the Partnership
Entities hold title to such real property interest or contained in
its chain of title thereto, which do not materially and adversely
effect current or intended use or operation of the subject real
property interest or which are capable of being routinely
addressed, cured, avoided or assumed in the ordinary course of
business and land management of the Partnership
Entities.
(ss) Rights-of Way .
At each Delivery Date, each of the Partnership Entities will have
such consents, easements, rights-of-way or licenses from any person
(“ rights-of-way ”) as are necessary to conduct
their business in the manner described in the most recent
Preliminary Prospectus and the Prospectus, subject to such
qualifications as may be set forth in the most recent Preliminary
Prospectus and the Prospectus and except for such rights-of-way
which, if not obtained, would not have, individually or in the
aggregate, a Material Adverse Effect; each of the Partnership
Entities has fulfilled and performed all its material obligations
with respect to such rights-of-way and no event has occurred which
allows, or after notice or lapse of time would allow, revocation or
termination thereof or would result in any impairment of the rights
of the holder of any
14
such rights-of-way, except
for such revocations, terminations and impairments that would not
have a Material Adverse Effect; and, except as described in the
most recent Preliminary Prospectus and the Prospectus, none of such
rights-of-way contains any restriction that is materially
burdensome to the Partnership Entities considered as a
whole.
(tt) Insurance . The
Partnership Entities maintain insurance covering their properties,
operations, personnel and businesses against such losses and risks
as are reasonably adequate to protect them and their businesses in
a manner consistent with other businesses similarly situated. None
of the Partnership Entities has received notice from any insurer or
agent of such insurer that material capital improvements or other
material expenditures will have to be made in order to continue
such insurance as of the Initial Delivery Date, and all such
insurance is outstanding and duly in force on the date hereof and
will be outstanding and duly in force on each Delivery
Date.
(uu) Investment
Company . None of the Partnership Entities is, and as of the
applicable Delivery Date and, after giving effect to the offer and
sale of the Offered Units and the application of the proceeds
therefrom as described under “Use of Proceeds” in the
most recent Preliminary Prospectus and the Prospectus, none of them
immediately after the applicable Delivery Date will be, an
“investment company” or a company “controlled
by” an “investment company” within the meaning of
such term under the Investment Company Act of 1940, as amended (the
“ Investment Company Act ”), and the rules and
regulations of the Commission thereunder.
(vv) Litigation .
Except as described in the most recent Preliminary Prospectus and
the Prospectus, there are no legal or governmental proceedings
pending to which any of the Partnership Entities is a party or of
which any property or assets of any of the Partnership Entities are
subject that could, in the aggregate, reasonably be expected to
have a Material Adverse Effect or could, in the aggregate,
reasonably be expected to have a material adverse effect on the
performance of this Agreement or the consummation of the
transactions contemplated hereby, and, to the Partnership’s
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or others.
(ww) Legal Proceedings or
Contracts to be Described or Filed . There are no legal or
governmental proceedings or contracts or other documents of a
character required to be described in the Registration Statement,
the most recent Preliminary Prospectus or the Prospectus or, in the
case of documents, to be filed as exhibits to the Registration
Statement, that are not described and filed as required. None of
the Partnership Entities has knowledge that any other party to any
such contract, agreement or arrangement has any intention not to
render full performance as contemplated by the terms thereof; and
that statements made or incorporated by reference in the most
recent Preliminary Prospectus and the Prospectus under the captions
“Risk Factors,” “Management’s Discussion
and Analysis of Financial Condition and Results of
Operations,” “Business, Risk Factors and
Properties” and “Legal Proceedings” insofar as
they purport to constitute summaries of the terms of statutes,
rules or regulations, legal or governmental proceedings or
contracts and other documents, constitute accurate summaries of the
terms of such statutes, rules and regulations, legal and
governmental proceedings and contracts and other documents in all
material respects.
15
(xx) Certain Relationships
and Related Transactions . Except as described in the most
recent Preliminary Prospectus and the Prospectus, no relationship,
direct or indirect, exists between or among the Partnership
Entities, on the one hand, and the directors, officers,
equityholders, customers or suppliers of the any of the Partnership
Entities, on the other hand, that is required to be described in
the most recent Preliminary Prospectus or the Prospectus which is
not so described.
(yy) No Labor Dispute
. No labor disturbance by the employees of any of the Partnership
Entities exists or, to the knowledge of the Partnership, is
imminent that could reasonably be expected to have a Material
Adverse Effect.
(zz) ERISA . As of the
Initial Delivery Date, (i) each “employee benefit
plan” (within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended
(“ ERISA ”)) for which any of the Partnership
Entities or any member of the “Controlled Group”
(defined as any organization which is a member of a controlled
group of corporations within the meaning of Section 414 of the
Internal Revenue Code of 1986, as amended (the “ Code
”)) of any of the Partnership Entities would have any
liability (each a “ Plan ”) has been maintained
in all material respects in compliance with its terms and with the
material requirements of all applicable statutes, rules and
regulations including ERISA and the Code; (ii) with respect to
each Plan subject to Title IV of ERISA (a) no
“reportable event” (within the meaning of
Section 4043(c) of ERISA and for which the 30-day reporting
requirement has not been waived) has occurred or is reasonably
expected to occur, (b) no “accumulated funding
deficiency” (within the meaning of Section 302 of ERISA
or Section 412 of the Code), whether or not waived, has
occurred or is reasonably expected to occur, (c) the fair
market value of the assets under each Plan exceeds the present
value of all benefits accrued under such Plan (determined on an
ongoing basis based on those assumptions used to fund such Plan)
and (d) none of the Partnership Entities or any member of the
Controlled Group of any of the Partnership Entities has incurred,
or reasonably expects to incur, any liability under Title IV of
ERISA (other than contributions to the Plan or premiums to the PBGC
in the ordinary course and without default) in respect of a Plan
(including a “multiemployer plan,” within the meaning
of Section 4001(c)(3) of ERISA), in each case that could
reasonably be expected to have a Material Adverse Effect; and
(iii) each Plan that is intended to be qualified under
Section 401(a) of the Code has been determined by the Internal
Revenue Service to be so qualified and nothing has occurred,
whether by action or by failure to act, which would cause the loss
of such qualification.
(aaa) Tax Returns .
Each of the Partnership Entities has filed all federal, state,
local and foreign income and franchise tax returns required to be
filed through the date hereof, subject to permitted extensions, and
have paid all taxes due thereon, and no tax deficiency has been
determined adversely to any of the Partnership Entities, nor do any
of the Partnership Entities have any knowledge of any tax
deficiencies that could, in the aggregate, reasonably be expected
to have a Material Adverse Effect.
16
(bbb) Books and Records;
Accounting Controls . Each of the Partnership Entities
(i) makes and keeps books, records and accounts, which, in
reasonable detail, accurately and fairly reflect transactions and
dispositions of assets and (ii) maintains and has maintained
effective internal control over financial reporting as defined in
Rule 13a-15 under the Exchange Act and a system of internal
accounting controls sufficient to provide reasonable assurance that
(A) transactions are executed in accordance with
management’s general or specific authorization;
(B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with accounting
principles generally accepted in the United States and to maintain
accountability for its assets; (C) access to assets is
permitted only in accordance with management’s general or
specific authorization; and (D) the recorded accountability
for assets is compared with existing assets at reasonable intervals
and appropriate action is taken with respect to any
differences.
(ccc) Disclosure Controls
and Procedures . (i) The Partnership has established and
maintains disclosure controls and procedures (as such term is
defined in Rule 13a-15 under the Exchange Act), (ii) such
disclosure controls and procedures are designed to ensure that the
information required to be disclosed by the Partnership in the
reports it files or will file or submit under the Exchange Act, as
applicable, is accumulated and communicated to management of the
Partnership including its respective principal executive officers
and principal financial officers, as appropriate, to allow such
officers to make timely decisions regarding required disclosure and
(iii) such disclosure controls and procedures are effective in
all material respects to perform the functions for which they were
established.
(ddd) No Changes in
Internal Controls . Since the date of the most recent balance
sheet of the Partnership and its consolidated subsidiaries reviewed
or audited by KPMG LLP and the audit committee of the board of
directors of NuStar GP, (i) the Partnership has not been
advised of (A) any significant deficiencies in the design or
operation of internal controls that could adversely affect the
ability of any such entities to record, process, summarize and
report financial data, or any material weaknesses in internal
controls or (B) any fraud, whether or not material, that
involves management or other employees who have a significant role
in the internal controls of any such entity, and (ii) since
that date, 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.
(eee) Sarbanes-Oxley Act
of 2002 . There is and has been no failure on the part of any
of NuStar GP’s directors or officers, in their capacities as
such, to comply in all material respects with the provisions of the
Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith (the “ Sarbanes-Oxley
Act ”).
(fff) Critical Accounting
Policies . The section entitled “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations—Critical Accounting Policies” in the most
recent Preliminary Prospectus and the Prospectus accurately and
fully describes (A) the accounting policies that the
Partnership believes are the most important in the portrayal of the
financial condition and results of operations
17
of the Partnership, and that
require management’s most difficult, subjective or complex
judgments (“ Critical Accounting Policies ”);
(B) the judgments and uncertainties affecting the application
of Critical Accounting Policies; and (C) the likelihood that
materially different amounts would be reported under different
conditions or using different assumptions and an explanation
thereof.
(ggg) Permits . Each
of the Partnership Entities has such permits, consents, licenses,
franchises, certificates and authorizations of governmental or
regulatory authorities (“ Permits ”) as are
necessary to own its properties and to conduct its businesses in
the manner described in the most recent Preliminary Prospectus and
the Prospectus, subject to such qualifications as may be set forth
in the most recent Preliminary Prospectus and the Prospectus and
except for such permits which, if not obtained, would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; each of the Partnership Entities has
fulfilled and performed all its material obligations with respect
to the Permits which are due to have been fulfilled and performed
by such date, and no event has occurred that allows, or after
notice or lapse of time would allow, revocation or termination
thereof or results in any other impairment of the rights of the
holder of any such Permits, except for any of the foregoing that
would not reasonably be expected to have a Material Adverse Effect;
and, except as described in the most recent Preliminary Prospectus
and the Prospectus, none of the Permits contain any restriction
that is materially burdensome to the Partnership Entities
considered as a whole.
(hhh) Environmental
Compliance . Each of the Partnership Entities (i) is 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) has received
all permits required of such entity under applicable Environmental
Laws to conduct its businesses, (iii) are in compliance with
all terms and conditions of any such permits and (iv) does 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 in connection with such releases 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 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.
(iii) No Restrictions on
Distributions . None of the Operating Subsidiaries is currently
prohibited, directly or indirectly, from paying any dividends or
other distributions, as applicable, to the Partnership, from
repaying to the Partnership any loans or advances to such Operating
Subsidiary from the Partnership or from transferring any of such
Operating Subsidiary’s property or assets to the Partnership
or any other
18
Operating Subsidiary of the
Partnership, except as described in or contemplated by (A) the
most recent Preliminary Prospectus and the Prospectus, (B) the
organizational documents of the Operating Subsidiaries or
(C) the periodic and current reports filed by the Partnership
with the Commission pursuant to the Exchange Act.
(jjj) No Distribution of
Other Offering Materials . None of the Partnership Entities has
distributed and, prior to the later to occur of any Delivery Date
and completion of the distribution of the Offered Units, will
distribute any offering material in connection with the offering
and sale of the Offered Units other than any Preliminary
Prospectus, the Prospectus and any Issuer Free Writing Prospectus
to which the Representatives have consented in accordance with
Section 1(i) or 4(a)(vi) or as set forth on Schedule IV
hereto.
(kkk) Market
Stabilization . The Partnership has not taken and will not
take, directly or indirectly, any action designed to or that has
constituted or that could reasonably be expected to cause or result
in the stabilization or manipulation of the price of any security
of the Partnership to facilitate the sale or resale of the Offered
Units.
Any certificate signed by any
officer on behalf of the Partnership and delivered to the
Representatives or counsel for the Underwriters in connection with
the offering of the Offered Units shall be deemed a representation
and warranty by the Partnership, as to matters covered thereby, to
each Underwriter.
2. Purchase of the Offered
Units by the Underwriters . On the basis of the representations
and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Partnership agrees to sell the
Firm Units to the several Underwriters, and each of the
Underwriters, severally and not jointly, agrees to purchase the
number of Firm Units set forth opposite that Underwriter’s
name in Schedule I hereto. The respective purchase obligations of
the Underwriters with respect to the Firm Units shall be rounded
among the Underwriters to avoid fractional units, as the
Representatives may determine.
In addition, the Partnership
grants to the Underwriters an option to purchase up to 667,500
Option Units. Such option is exercisable in the event that the
Underwriters sell more Offered Units than the number of Firm Units
in the offering and as set forth in Section 3 hereof. Each
Underwriter agrees, severally and not jointly, to purchase the
number of Option Units (subject to such adjustments to eliminate
fractional Offered Units as the Representatives may determine) that
bears the same proportion to the total number of Option Units to be
sold on such Delivery Date as the number of Firm Units set forth in
Schedule I hereto opposite the name of such Underwriter bears to
the total number of Firm Units.
The price of both the Firm
Units and any Option Units purchased by the Underwriters shall be
$46.80 per unit.
The Partnership shall not be
obligated to deliver any of the Firm Units or the Option Units to
be delivered on the applicable Delivery Date, except upon payment
for all such Offered Units to be purchased on such Delivery Date as
provided herein.
19
3. Delivery of and Payment
for the Offered Units . Delivery of and payment for the Firm
Units shall be made at 10:00 A.M., New York City time, on the
fourth full business day following the date of this Agreement or at
such other date or place as shall be determined by agreement
between the Representatives and the Partnership. This date and time
are sometimes referred to as the “ Initial Delivery
Date .” Delivery of the Firm Units shall be made to the
Representatives for the account of each Underwriter against payment
by the several Underwriters through the Representatives and of the
respective aggregate purchase prices of the Firm Units being sold
by the Partnership to or upon the order of the Partnership of the
purchase price by wire transfer in immediately available funds to
the accounts specified by the Partnership. Time shall be of the
essence, and delivery at the time and place specified pursuant to
this Agreement is a further condition of the obligation of each
Underwriter hereunder. The Partnership shall deliver the Firm Units
through the facilities of the Depository Trust Company unless the
Representatives shall otherwise instruct.
The option granted in
Section 2 will expire at 5:00 p.m., New York City time on the
30th day after the date of this Agreement and may be exercised in
whole or from time to time in part by written notice being given to
the Partnership by the Representatives; provided that if
such date falls on a day that is not a business day, the option
granted in Section 2 will expire on the next succeeding
business day. Such notice shall set forth the aggregate number of
Option Units as to which the option is being exercised, the names
in which the Option Units are to be registered, the denominations
in which the Option Units are to be issued and the date and time,
as determined by the Representatives, when the Option Units are to
be delivered; provided, however , that this date and time
shall not be earlier than the Initial Delivery Date nor earlier
than the third business day after the date on which the option
shall have been exercised nor later than the fifth business day
after the date on which the option shall have been exercised. Each
date and time the Option Units are delivered is sometimes referred
to as an “ Option Unit Delivery Date ,” and the
Initial Delivery Date and any Option Unit Delivery Date are
sometimes each referred to as a “ Delivery Date
.”
Delivery of the Option Units
by the Partnership and payment for the Option Units by the several
Underwriters through the Representatives shall be made at 10:00
A.M., New York City time, on the date specified in the
corresponding notice described in the preceding paragraph or at
such other date or place as shall be determined by agreement
between the Representatives and the Partnership. On the Option Unit
Delivery Date, the Partnership shall deliver or cause to be
delivered the Option Units to the Representatives for the account
of each Underwriter against payment by the several Underwriters
through the Representatives and of the respective aggregate
purchase prices of the Option Units being sold by the Partnership
to or upon the order of the Partnership of the purchase price by
wire transfer in immediately available funds to the account
specified by the Partnership. Time shall be of the essence, and
delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligation of each Underwriter
hereunder. The Partnership shall deliver the Option Units through
the facilities of Depository Trust Company unless the
Representatives shall otherwise instruct.
20
4. Further Agreements of
the Partnership Parties.
(a) Each of the Partnership
Parties agrees:
(i) Preparation of
Prospectus and Registration Statement . To prepare the
Prospectus in a form approved by the Representatives and to file
such Prospectus pursuant to Rule 424(b) under the Securities Act
not later than the Commission’s close of business on the
second business day following the execution and delivery of this
Agreement; to make no further amendment or any supplement to the
Registration Statement or the Prospectus prior to the last Delivery
Date except as provided herein; to advise the Representatives,
promptly after it receives notice thereof, of the time when any
amendment or supplement to the Registration Statement or the
Prospectus has been filed and to furnish or make available to the
Representatives copies thereof; to file promptly all reports and
any definitive proxy or information statements required to be filed
by each of the Partnership Parties with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the
offering or sale of the Offered Units; to advise the
Representatives, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order
preventing or suspending the use of the Prospectus or any Issuer
Free Writing Prospectus, of the suspension of the qualification of
the Offered Units for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding or examination for any
such purpose, of any notice from the Commission objecting to the
use of the form of the Registration Statement or any post-effective
amendment thereto or of any request by the Commission for the
amending or supplementing of t
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