3,300,000 Units
Representing Limited Partner Interests
UNDERWRITING AGREEMENT
Wells Fargo Securities,
LLC
Raymond James &
Associates, Inc.
RBC Capital Markets
Corporation
As Representatives of the several Underwriters
named in Schedule I
c/o Wells Fargo
Securities, LLC
375 Park Avenue
New York, New York 10152
Legacy Reserves
LP, a Delaware limited partnership (the “
Partnership ”), confirms its agreement with
Wells Fargo Securities, LLC (“ Wells Fargo
”), Raymond James & Associates, Inc. (“
Raymond James ”), RBC Capital Markets
Corporation (“ RBC ”) and each of the
other Underwriters named in Schedule 1 hereto
(collectively, the “ Underwriters, ”
which term shall also include any underwriter substituted as
hereinafter provided in Section 11 hereof), for whom Wells
Fargo is acting as representatives (in such capacity, the “
Representatives ”), with respect to the issue
and sale by the Partnership of a total of 3,300,000 Units (the
“ Firm Securities ”) representing limited
partner interests in the Partnership (the “
Units ”), and the purchase by the Underwriters,
acting severally and not jointly, of the respective numbers of Firm
Securities set forth in said Schedule 1 hereto,
and with respect to the grant by the Partnership to the
Underwriters, acting severally and not jointly, of the option
described in Section 3 hereof to purchase all or any part of
495,000 additional Units to cover over-allotments, if any. The Firm
Securities to be purchased by the Underwriters and all or any part
of the 495,000 Units subject to the option described in
Section 3 hereof (the “ Option Securities
”) are hereinafter called, collectively, the “
Securities .” Certain terms used in this
Agreement are defined in Section 17 hereof.
Legacy Reserves
GP, LLC, a Delaware limited liability company (the “
General Partner ”), is the Partnership’s
sole general partner. Legacy Reserves Operating GP, LLC, a Delaware
limited liability company and a wholly owned subsidiary of the
Partnership (“ Operating GP ”), is the
sole general partner of Legacy Reserves Operating LP, a Delaware
limited partnership (the “ Operating
Partnership ” and, together with the General Partner,
the Partnership and the Operating GP, the “ Legacy
Parties ” and, together with the direct and indirect
subsidiaries of the Partnership (collectively, the “
Subsidiaries ”) listed in
Schedule III , the “ Partnership
Entities ”).
1.
Representations and Warranties by the Legacy Parties . The
Legacy Parties jointly and severally represent and warrant to and
agree with each Underwriter as set forth below:
(a)
Registration Statement/Prospectus . A shelf registration
statement (Registration No. 333-150111) on Form S-3 to be used in
connection with the public offering and sale of the Securities,
including a related Basic Prospectus (as defined below),
(i) has been prepared by the Partnership pursuant to and in
conformity with the requirements of the Securities Act of 1933 (the
“ 1933 Act ”), and the rules and
regulations thereunder (the “ 1933 Act Rules and
Regulations ”) of the United States Securities and
Exchange Commission (the “ Commission ”),
(ii) has been filed with the Commission under the 1933 Act,
and (iii) is effective under the 1933 Act. The conditions for
the use of Form S-3, as set forth in the General Instructions
thereto, have been satisfied. The Partnership may have filed with
the Commission, as part of an amendment to the Registration
Statement or pursuant to Rule 424(b), one or more Preliminary
Prospectuses (as defined below) relating to the Securities, each of
which has previously been furnished to the Representatives. As used
in this Agreement:
(i) “
Basic Prospectus ” shall mean the prospectus
referred to in paragraph 1(a) above contained in the Registration
Statement at the Effective Date.
(ii) “
Disclosure Package ” shall mean, as of the
Execution Time, the most recent Preliminary Prospectus, together
with (A) any Issuer Free Writing Prospectus filed by the
Partnership on or before the Execution Time and identified on
Schedule II hereto, and (B) the pricing
information identified on Schedule II
hereto.
(iii) “
Effective Date ” shall mean any date as of
which any part of the Registration Statement became, or is deemed
to have become, effective under the 1933 Act in accordance with the
1933 Act Rules and Regulations.
(iv) “
Execution Time ” shall mean the date and time
(7:30 a.m. Central Time) that this Agreement is executed and
delivered by the parties hereto.
(v) “
Prospectus ” shall mean the prospectus
supplement relating to the Securities that was first filed pursuant
to Rule 424(b) after the Execution Time, together with the Basic
Prospectus.
(vi) “
Issuer Free Writing Prospectus ” means each
“free writing prospectus” (as defined in Rule 405
of the 1933 Act 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 Securities.
(vii) “
Preliminary Prospectus ” shall mean any
preliminary prospectus supplement to the Basic Prospectus, which
describes the Securities and the offering thereof, and is used
prior to filing of the Prospectus, together with the Basic
Prospectus.
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(viii) “
Registration Statement ” shall mean the
registration statement referred to in paragraph 1(a) above,
including exhibits and financial statements and any prospectus
supplement relating to the Securities that is filed with the
Commission pursuant to Rule 424(b) and deemed part of such
registration statement pursuant to Rule 430B, as amended at
the Execution Time and, in the event any post-effective amendment
thereto or any Rule 462(b) Registration Statement becomes effective
prior to the Initial Delivery Date, shall also mean such
registration statement as so amended or such Rule 462(b)
Registration Statement, as the case may be.
(ix) “
Rule 462(b) Registration Statement ” shall
mean a registration statement and any amendments thereto filed
pursuant to Rule 462(b) relating to the offering covered by the
registration statement referred to in Section 1(a)
hereof.
Any reference
to any Preliminary Prospectus, the Disclosure Package or the Basic
Prospectus, or any amendment or supplement thereto, shall be deemed
to refer to and include any documents incorporated by reference
therein pursuant to Form S-3 under the 1933 Act as of the date of
such Preliminary Prospectus or the Basic Prospectus, as the case
may be, or in the case of the Disclosure Package, as of the
Execution Time. 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 Basic Prospectus shall be deemed to refer to and
include any document filed under the Securities Exchange Act of
1934 (the “ 1934 Act ”), after the date
of such Preliminary Prospectus or the Basic Prospectus, as the case
may be, and incorporated by reference in such Preliminary
Prospectus or the Basic Prospectus, as the case may be; and any
reference to any amendment to the Registration Statement shall be
deemed to include the most recent annual report of the Partnership
on Form 10-K filed with the Commission pursuant to Section 13(a) or
15(d) of the 1934 Act after the Effective Date that is incorporated
by reference in the Registration Statement. The Commission has not
issued any stop order suspending the effectiveness of the
Registration Statement, and no proceeding or examination for such
purpose has been instituted or, to the Partnership’s
knowledge, threatened by the Commission. The Commission has not
notified the Partnership of any objection to the use of the form of
the Registration Statement.
(b) Form of
Documents . The Registration Statement complied and will comply
in all material respects on each Effective Date and on the
applicable Delivery Date, and any amendment to the Registration
Statement filed after the date hereof will comply in all material
respects when filed, to the requirements of the 1933 Act and the
1933 Act Rules and Regulations. The most recent Preliminary
Prospectus complied, and the Prospectus will comply, in all
material respects when filed with the Commission pursuant to Rule
424(b) to the requirements of the 1933 Act and the 1933 Act Rules
and Regulations.
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(c) No Material
Misstatements or Omissions in the 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 , however
, that the Partnership makes no representations or warranties as to
the information contained in or omitted from the Registration
Statement in reliance upon and in conformity with written
information furnished to the Partnership by or on behalf of the
Underwriters specifically for inclusion in the Registration
Statement, it being understood and agreed that the only such
information furnished by the Underwriters consists of the
information described as such in Section 13 hereof.
(d) No Material
Misstatements or Omissions in the 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 in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading; provided , however , that the Partnership
makes no representations or warranties as to the information
contained in or omitted from the Prospectus in reliance upon and in
conformity with written information furnished to the Partnership by
or on behalf of the Underwriters specifically for inclusion in the
Prospectus, it being understood and agreed that the only such
information furnished by the Underwriters consists of the
information described as such in Section 13 hereof.
(e) No Material
Misstatements or Omissions in the Disclosure Package . The
Disclosure Package did not, as of the Execution Time, contain any
untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading;
provided , however , that the Partnership makes no
representations or warranties as to the information contained in or
omitted from the Disclosure Package in reliance upon and in
conformity with written information furnished to the Partnership by
or on behalf of the Underwriters specifically for inclusion in the
Disclosure Package, it being understood and agreed that the only
such information furnished by the Underwriters consists of the
information described as such in Section 13 hereof.
(f) Ineligible
Issuer . (i) At the time of the initial filing of the
Registration Statement and (ii) as of the Execution Time (with
such date being used as the determination date for purposes of this
clause (ii)), the Partnership was not and is not an Ineligible
Issuer (as defined in Rule 405), without taking account of any
determination by the Commission pursuant to Rule 405 that it
is not necessary that the Partnership be considered an Ineligible
Issuer.
(g) Issuer Free
Writing Prospectus . Each Issuer Free Writing Prospectus
(including, without limitation, any road show that is a free
writing prospectus under Rule 433), when considered together
with the Disclosure Package as of the Execution Time, did not
contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading. The foregoing sentence does not apply to statements in
or omissions from any Issuer Free Writing Prospectus based upon and
in
4
conformity with
written information furnished to the Partnership by or on behalf of
the Underwriters specifically for inclusion in the Registration
Statement, the Disclosure Package, any Issuer Free Writing
Prospectus or the Prospectus (or any supplement thereto), it being
understood and agreed that the only such information furnished by
the Underwriters consists of the information described as such in
Section 13 hereof. Each Issuer Free Writing Prospectus
(including, without limitation, any road show that is a free
writing prospectus under Rule 433) does not include any
information that conflicts in any material respect with the
information contained in the Disclosure Package, including any
document incorporated by reference therein that has not been
superseded or modified.
(h) Other
Sales . The Partnership has not sold or issued any Units during
the six-month period preceding the date of the Initial Delivery
Date, other than pursuant to acquisitions, employee benefit plans,
qualified options plans or other employee compensation plans or
pursuant to outstanding options, rights or warrants described in
the Disclosure Package and the Prospectus.
(i) Independent
Accountants . The accountants who audited the audited financial
statements and supporting schedules included in the Registration
Statement and the Preliminary Prospectus are an independent public
accounting firm within the meaning of the 1933 Act and the 1933 Act
Rules and Regulations and the Public Company Accounting Oversight
Board (United States).
(j) Reserve
Engineer . LaRoche Petroleum Consultants Ltd. (the “
Reserve Engineer ”), whose report dated
December 31, 2008 (the “ Reserve Report
”) is referenced in the Registration Statement, Disclosure
Package and Prospectus and who has delivered the letter referred to
in Section 6(f) hereof, was as of the date of such report, and is,
as of the date hereof, an independent reserve engineer with respect
to the Partnership. No information has come to the attention of the
Partnership or, to the Partnership’s knowledge, to the
Reserve Engineer, that could reasonably be expected to cause the
Reserve Engineer to withdraw its Reserve Report.
(k) Information
Underlying Reserve Report . The information underlying the
estimates of the Partnership’s proved reserves that was
supplied to the Reserve Engineer for the purposes of preparing the
Reserve Report and estimates of the proved reserves of the
Partnership disclosed in the Registration Statement, Disclosure
Package and the Prospectus, including, production, costs of
operation, and, to the Partnership Entities’ knowledge,
future operations and sales of production, was true and correct in
all material respects on the dates such information was provided,
and such information was supplied and was prepared in accordance
with customary industry practices; and the estimates of such
reserves and standardized measure thereof as described in the
Registration Statement, Disclosure Package and the Prospectus and
future net cash flow reflected in the Reserve Report referenced
therein have been prepared in a manner that complies with the
applicable requirements of the 1933 Act Rules and Regulations.
Other than normal production of the reserves, product price
fluctuations, and fluctuations of demand for such products, and
except as disclosed in the Registration Statement, Disclosure
Package and the Prospectus, no Legacy Party is aware of any facts
or circumstances that would result in a materially adverse change
in the reserves in the aggregate, or the aggregate
5
present value
of the future net cash flows therefrom as described in the
Registration Statement, Disclosure Package and the Prospectus and
as reflected in the Reserve Report.
(l) Financial
Statements . The financial statements of the Partnership
included or incorporated by reference in the Registration
Statement, the Disclosure Package and the Prospectus, together with
the related schedules (if any) and notes, present fairly in all
material respects the financial position of the Partnership and its
consolidated subsidiaries at the dates indicated and the results of
operations, changes in unitholders’ equity and cash flows of
the Partnership and its consolidated subsidiaries for the periods
specified; the financial statements of any other entities or
businesses included or incorporated by reference in the
Registration Statement, the Disclosure Package or the Prospectus,
together with the related schedules (if any) and notes, present
fairly in all material respects the financial position of each such
entity or business, as the case may be, and its consolidated
subsidiaries (if any) at the dates indicated and the results of
operations, changes in stockholders’ (or other owners’)
equity and cash flows of such entity or business, as the case may
be, and its consolidated subsidiaries, if any, for the periods
specified; and all such financial statements have been prepared in
conformity with GAAP applied on a consistent basis throughout the
periods involved and comply with all applicable accounting
requirements under the 1933 Act and the 1933 Act Rules and
Regulations. The supporting schedules, if any, included or
incorporated by reference in the Registration Statement present
fairly, in all material respects in accordance with GAAP, the
information required to be stated therein. The information in the
Disclosure Package and in the Prospectus under the caption
“Summary” presents fairly in all material respects the
information shown therein and has been compiled on a basis
consistent with that of the audited financial statements of the
Partnership included or incorporated by reference in the
Registration Statement, the Disclosure Package and the Prospectus.
All information contained in the Registration Statement, the
Disclosure Package and the Prospectus regarding “non-GAAP
financial measures” (as defined in Regulation G of the
Commission) complies with Regulation G and Item 10 of
Regulation S-K of the Commission, to the extent applicable.
There are no financial statements (historical or pro forma) that
are required to be included or incorporated by reference in the
Registration Statement, the Disclosure Package or the Prospectus
that are not so included or incorporated, as applicable, as
required.
(m) No Material
Adverse Change in Business . Since the respective dates as of
which information is given in the Registration Statement, the
Disclosure Package and the Prospectus (in each case exclusive of
any amendments or supplements thereto subsequent to the date of
this Agreement), except as otherwise stated therein, (A) there
has been no material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business
prospects of the Partnership and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of
business (a “ Material Adverse Effect ”),
(B) there have been no transactions entered into by the
Partnership or any of its subsidiaries which are material with
respect to the Partnership and its subsidiaries considered as one
enterprise, and (C) except for regular quarterly distributions
on the Units in amounts per Unit that are consistent with past
practice, there has been no dividend or distribution of any kind
declared, paid or made by the Partnership on the Units.
6
(n) Good
Standing of the Partnership Entities . Each Partnership Entity
has been duly organized or formed and is validly existing as a
limited partnership, limited liability company, corporation or
other business entity, in good standing under the laws of the state
of its incorporation or formation and has power and authority to
own, lease and operate its properties and to conduct its business
as described in the Registration Statement, the Disclosure Package
and the Prospectus and to enter into and perform its obligations
under this Agreement; and the Partnership is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of
business, except to the extent that the failure to be so qualified
or be in good standing would not, individually or in the aggregate
result in a Material Adverse Effect.
(i) Moriah
Properties, Ltd., DAB Resources, Ltd., Brothers Production
Properties, Ltd., Brothers Production Company, Inc., Brothers
Operating Company, Inc., J&W McGraw Properties, Ltd., MBN
Properties LP and H2K Holdings, Ltd. own 100% of the issued and
outstanding membership interests in the General Partner; such
membership interests have been duly authorized and validly issued
in accordance with the GP LLC Agreement, and are fully paid and
non-assessable (except as such non-assessability may be limited by
Sections 18-607 and 18-804 of the Delaware LLC Act); and such
persons and entities own such membership interests free and clear
of all Liens.
(ii) The General
Partner is the sole general partner of the Partnership with an
approximate 0.06% general partner interest in the Partnership; such
general partner interest has been duly authorized and validly
issued in accordance with the Amended and Restated Limited
Partnership Agreement of the Partnership (the “
Partnership Agreement ”) and is fully paid; and
the General Partner owns such general partner interest free and
clear of all Liens; the General Partner owns no assets, and has no
business, other than with respect to its general partner interest
in the Partnership.
(iii) At the
Initial Delivery Date, after giving effect to the offering
contemplated hereby (assuming the option to purchase Option
Securities is not exercised), the issued and outstanding limited
partner interests of the Partnership will consist of 34,390,474
Units. All of the issued and outstanding Units, and the limited
partner interests represented thereby, 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 non-assessable (except as such non-assessability may
be affected by Sections 17-607 and 17-804 of the Delaware LP
Act).
(iv) The
Securities to be issued and sold by the Partnership hereunder, and
the limited partner interests represented thereby, will be duly
authorized in accordance with the Partnership Agreement and, when
issued and delivered to the purchaser thereof against payment
therefor in accordance with the terms of this
7
Agreement, will
be validly issued, fully paid (to the extent required under the
Partnership Agreement) and non-assessable (except as such
non-assessability may be affected by Sections 17-303, 17-607
and 17-804 of the Delaware LP Act).
(p) Operating
GP Ownership . The Partnership owns 100% of the membership
interests in the Operating GP; such membership interests have been
duly authorized and validly issued in accordance with the Operating
GP Agreement, and are fully paid and non-assessable (except as such
non-assessability may be affected by Sections 18-607 and
18-804 of the Delaware LLC Act); and the Partnership owns such
membership interests free and clear of all Liens, except for the
pledge of such membership interests under the Credit Agreement,
dated March 27, 2009, by and between the Partnership and BNP
Paribas (the “ Credit Agreement
”).
(q) Operating
Partnership Ownership . (A) The Operating GP is the sole
general partner of the Operating Partnership with a 0.1% general
partner interest in the Operating Partnership; such general partner
interest has been duly authorized and validly issued in accordance
with the Agreement of Limited Partnership of the Operating
Partnership (the “ Operating Partnership
Agreement ”), and is fully paid; and the Operating GP
owns such general partner interest free and clear of all Liens,
except for the pledge of such general partner interest under the
Credit Agreement; and (B) the Partnership is the sole limited
partner of the Operating Partnership with a 99.9% limited partner
interest in the Operating Partnership; such limited partner
interest has been duly authorized and validly issued in accordance
with the Operating Partnership Agreement and is fully paid (to the
extent required under the Operating Partnership Agreement) and
non-assessable (except as such non-assessability may be affected by
Sections 17-303, 17-607 and 17-804 of the Delaware LP Act and
as otherwise described in the Prospectus); and the Partnership owns
such limited partner interest free and clear of all Liens, except
for the pledge of such limited partner interest under the Credit
Agreement.
(r) No Other
Subsidiaries . Other than ownership interests in the
Subsidiaries, the Partnership does not own, and at the Initial
Delivery Date and the Option Security Delivery Date, will not own,
directly or indirectly, an equity or long-term debt securities of
any corporation, partnership, limited liability company, joint
venture, association or other entity. Other than its ownership
interest in the Partnership and its indirect ownership interests in
the Subsidiaries, the General Partner does not own, and at the
Initial Delivery Date and the Option Security Delivery Date 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.
(s) Authority
and Authorization. The Partnership has all requisite power and
authority to issue, sell and deliver the Securities in accordance
with and upon the terms and conditions set forth in this Agreement,
the Partnership Agreement, the Registration Statement, the
Disclosure Package and the Prospectus. At each Delivery Date, all
corporate, partnership and limited liability company action, as the
case may be, required to be taken by the Partnership Entities or
any of their stockholders, partners or members for the
authorization, issuance, sale and delivery of the Securities shall
have been validly taken.
8
(t)
Authorization of Agreement . This Agreement has been duly
authorized, executed and delivered by the Legacy
Parties.
(u)
Enforceability of Organizational Agreements. Each of the
Organizational Agreements has been duly authorized and validly
executed and delivered by the parties thereto and is a valid and
legally binding agreement of such party, enforceable against such
party in accordance with its terms; provided that 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);
and provided , further , that the indemnity,
contribution and exoneration provisions contained in any of such
agreements may be limited by applicable laws and public
policy.
(v) Description
of Securities . The Securities, when issued and delivered in
accordance with the terms of this Agreement, will conform in all
material respects to the description thereof contained in the
Registration Statement, the Disclosure Package and the
Prospectus.
(w) Absence of
Defaults and Conflicts . None of the Partnership Entities is in
violation of its Organizational Documents or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any Partnership Document, except (solely in
the case of Partnership Documents other than Subject Instruments)
for such defaults that would not result in a Material Adverse
Effect. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein and in
the Registration Statement, the Disclosure Package and the
Prospectus (including the issuance and sale of the Securities and
the use of the proceeds from the sale of the Securities as
described in the Prospectus under the caption “Use of
Proceeds”) and compliance by the Legacy Parties with their
obligations under this Agreement do not and will not, whether with
or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment
Event under, or result in the creation or imposition of any Lien
upon any property or assets of the Partnership or any of its
subsidiaries pursuant to any Partnership Documents, except (solely
in the case of Partnership Documents other than Subject
Instruments) for such conflicts, breaches, defaults or Liens that
would not result in a Material Adverse Effect, nor will such action
result in any violation of the provisions of the Organizational
Documents of the Partnership or any of its subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Partnership or
any of its subsidiaries or any of their respective assets,
properties or operations, except for such violations of any
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Partnership or
any of its subsidiaries or any of their respective assets,
properties or operations that would not, individually or in the
aggregate, result in a Material Adverse Effect.
9
(x) Absence of
Consents . No permit, consent, approval, authorization, order,
registration, filing or qualification (“
Consent ”) of or with any court, governmental
agency or body having jurisdiction over any of the Partnership
Entities or any of their respective properties is required in
connection with the offering, issuance and sale by the Partnership
of the Securities, the execution, delivery and performance of this
Agreement by the Legacy Parties, or the consummation by the Legacy
Parties of the transactions contemplated hereby, except for such
Consents as may be required under the 1933 Act, the 1933 Act Rules
and Regulations, the 1934 Act and the rules and regulations
thereunder (the “ 1934 Act Rules and
Regulations ”) and state securities or “Blue
Sky” laws and applicable rules and regulations under such
laws.
(y) Absence of
Labor Dispute . No labor dispute with the employees of any
Partnership Entity exists or, to the knowledge of the Partnership,
is threatened or imminent, and the Partnership is not aware of any
existing or imminent labor disturbance by the employees of any of
the principal suppliers, manufacturers, customers or contractors of
any Partnership Entity which, in any such case, would reasonably be
expected to result in a Material Adverse Effect.
(z) Absence of
Proceedings . There is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency
or body, domestic or foreign, now pending, or, to the knowledge of
the Partnership, threatened, against or affecting any Partnership
Entity which is required to be disclosed in the Registration
Statement (other than as disclosed therein), or which would
reasonably be expected to result in a Material Adverse Effect, or
which would reasonably be expected to materially and adversely
affect the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by
the Partnership of its obligations under this Agreement; the
aggregate of all pending legal or governmental proceedings to which
any Partnership Entity is a party or of which any of their
respective property or assets is the subject which are not
described in the Registration Statement, including ordinary routine
litigation incidental to the business, could not reasonably be
expected to result in a Material Adverse Effect.
(aa) Accuracy
of Descriptions and Exhibits . The information in the
Registration Statement and in the Preliminary Prospectus under the
captions “Description of Our Units,” “Material
Provisions of Our Partnership Agreement,” “Conflicts of
Interest and Fiduciary Duties” and “Material Tax
Considerations,” in each case to the extent that it
constitutes matters of law, summaries of legal matters, summaries
of provisions of the Partnership’s Organizational Documents
or any other instruments or agreements, summaries of legal
proceedings, or legal conclusions, is correct in all material
respects; all descriptions in the Registration Statement and the
Preliminary Prospectus of any Partnership Documents are accurate in
all material respects; and there are no franchises, contracts,
indentures, mortgages, deeds of trust, loan or credit agreements,
bonds, notes, debentures, evidences of indebtedness, leases or
other instruments or agreements required to be described or
referred to in the Registration Statement, or the Preliminary
Prospectus or to be filed as exhibits to the Registration Statement
which have not been so described and filed as required.
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(bb) Possession
of Intellectual Property . The Partnership and its subsidiaries
own or possess or have the right to use on reasonable terms all
patents, patent rights, patent applications, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names,
service names and other intellectual property (collectively,
“ Intellectual Property ”) necessary to
carry on their respective businesses as described in the Prospectus
except where the failure to own, possess or have the right to use
would not, individually or in the aggregate, result in a Material
Adverse Effect; and neither the Partnership nor any of its
subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with
respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid
or inadequate to protect the interest of the Partnership or any of
its subsidiaries therein, and which infringement or conflict (if
the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, individually or in the aggregate, would
result in a Material Adverse Effect.
(cc) Absence of
Further Requirements . (A) No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency, domestic or foreign, (B) no authorization, approval,
vote or other consent of any member, unitholder or creditor of any
Partnership Entity, (C) no waiver or consent under any Subject
Instrument, and (D) no authorization, approval, vote or other
consent of any other person or entity, is necessary or required for
the performance by the Partnership of its obligations under this
Agreement, for the offering, issuance, sale or delivery of the
Securities hereunder, or for the consummation of any of the other
transactions contemplated by this Agreement, in each case on the
terms contemplated by the Registration Statement and the
Preliminary Prospectus, except such as have been already obtained
under the 1933 Act or the 1933 Act Rules and Regulations or such as
may be required under state securities laws.
(dd) Possession
of Licenses and Permits . The Partnership Entities possess such
permits, licenses, approvals, consents and other authorizations
(collectively, “ Governmental Licenses ”)
issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by them, except where the failure to possess such permits,
licenses, approvals, consents and other authorizations would not,
individually or in the aggregate, have a Material Adverse Effect;
the Partnership Entities are in compliance with the terms and
conditions of all such Governmental Licenses, except where the
failure so to comply would not, individually or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses
are valid and in full force and effect, except when the invalidity
of such Governmental Licenses or the failure of such Governmental
Licenses to be in full force and effect would not, individually or
in the aggregate, have a Material Adverse Effect; and none of the
Partnership Entities has received any notice of proceedings
relating to the revocation or modification of any such Governmental
Licenses which, individually or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
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(ee) Title to
Real Property . Each of the Partnership Entities has
(A) legal, valid and defensible title to the interests in Oil
and Gas Properties supporting the estimates of its net proved
reserves contained in the Registration Statement and the
Preliminary Prospectus, (B) good and marketable title in fee
simple to all real property other than Oil and Gas Properties
covered by clause (A), and (C) good and marketable title to
all personal property owned by them, in each case free and clear of
all Liens except such as are described in the Registration
Statement and the Preliminary Prospectus or such as do not
materially affect the value of the property of the Partnership
Entities, taken as a whole, and do not materially interfere with
the use made of such property by any of the Partnership Entities;
all real property and buildings held under lease by any of the
Partnership Entities are held by them under valid, subsisting and
enforceable leases, with such exceptions as do not materially
affect the value of such property and do not materially interfere
with the use made of such property by any of the Partnership
Entities. The Working Interests derived from the Oil and Gas
Properties evidence in all material respects the right of the
Partnership Entities to explore, develop and produce hydrocarbons
from such Hydrocarbon Interests, and the acquisition and
procurement of such oil and gas leases, options to lease, drilling
rights and concessions or other property interests was generally
consistent with standard industry practices in the areas in which
the Partnership Entities operate for acquiring or procuring oil and
gas leases and interests therein to explore, develop or produce
hydrocarbons.
(ff) Certain
Relationships and Related Transactions. No relationship, direct
or indirect, exists between or among any Partnership Entity, on the
one hand, and the directors, managers, officers, members, partners,
stockholders, customers or suppliers of any Partnership Entity, on
the other hand, that is required to be described in the
Registration Statement and Preliminary Prospectus and is not so
described.
(gg) Investment
Company Act . No Partnership Entity is, and upon the issuance
by the Partnership and sale of the Securities as herein
contemplated and the application of the net proceeds therefrom as
described in the Preliminary Prospectus, no Partnership Entity will
be, an “investment company” or an entity
“controlled” by an “investment company” as
such terms are defined in the Investment Company Act of 1940, as
amended (the “ 1940 Act ”).
(hh)
Environmental Laws . Except as described in the Registration
Statement and the Preliminary Prospectus and except as would not,
individually or in the aggregate, result in a Material Adverse
Effect, (A) no Partnership Entity is in violation of any
federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment
(including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the
release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, “
Hazardous Materials ”) or to the manufacture,
processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively, “
Environmental Laws ”), (B) the
12
Partnership
Entities have all permits, authorizations and approvals required
under any applicable Environmental Laws and are each in compliance
with their requirements, (C) there are no pending or
threatened administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any
Environmental Law against any Partnership Entity and (D) there
are no events or circumstances that might reasonably be expected to
form the basis of an order for clean-up or remediation, or an
action, suit or proceeding by any private party or governmental
body or agency, against or affecting any Partnership Entity
relating to Hazardous Materials or any Environmental
Laws.
(ii) Absence of
Registration Rights . Except as disclosed in the Registration
Statement and the Preliminary Prospectus, there are no persons with
registration rights or other similar rights to have any securities
(debt or equity) (A) registered pursuant to the Registration
Statement or included in the offering contemplated by this
Agreement or (B) otherwise registered by the Partnership under the
1933 Act. There are no persons with tag along rights or other
similar rights (other than any such rights which have been complied
with or waived) to have any securities (debt or equity) included in
the offering contemplated by this Agreement or sold in connection
with the sale of Securities by the Partnership pursuant to this
Agreement
(jj) Parties to
Lock-up Agreements . Each of the parties listed on
Exhibit A hereto has executed and delivered to the
Representatives a lock-up agreement in the form of
Exhibit B hereto. Exhibit A hereto contains
a true, complete and correct list of all directors and officers of
the Legacy Parties.
(kk) NASDAQ
Global Select Market . The Securities being sold hereunder by
the Partnership have been approved for listing, subject only to
official notice of issuance, on the NASDAQ Global Select Market
(the “ NASDAQ ”).
(ll) FINRA and
NASD Conduct Rule Matters . To the knowledge of the
Partnership Entities, all of the information provided to the
Underwriters or to counsel for the Underwriters by the Partnership
and its officers and directors in connection with letters, filings
or other supplemental information provided to FINRA pursuant to
FINRA Rule 5110 or NASD Conduct Rule 2720 is true,
complete and correct.
(mm) Tax
Returns . The Partnership Entities have filed all foreign,
federal, state and local tax returns that are required to be filed
or have requested extensions thereof, except where the failure so
to file would not, individually or in the aggregate, have a
Material Adverse Effect, and have paid all taxes required to be
paid by them and any other assessment, fine or penalty levied
against any of them, to the extent that any of the foregoing is due
and payable, except for any such tax, assessment, fine or penalty
that is currently being contested in good faith by appropriate
actions and except for such taxes, assessments, fines or penalties
the nonpayment of which would not, individually or in the
aggregate, have a Material Adverse Effect.
(nn)
Insurance . The Partnership Entities are insured by insurers
of recognized financial responsibility against such losses and
risks and in such amounts as, in
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management’s judgment, are prudent and
customary in the businesses in which they are engaged; all policies
of insurance and any fidelity or surety bonds insuring any
Partnership Entity or their respective businesses, assets,
employees, officers and directors are in full force and effect; the
Partnership Entities are in compliance with the terms of such
policies and instruments in all material respects; there are no
claims by any Partnership Entity under any such policy or
instrument as to which any insurance company is denying liability
or defending under a reservation of rights clause; no Partnership
Entity has been refused any insurance coverage sought or applied
for; and no Partnership Entity has any reason to believe that it
will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a
cost that would not result in a Material Adverse Effect.
(oo) Accounting
Controls . The Partnership Entities (A) make and keep
books, records and accounts, which, in reasonable detail,
accurately and fairly reflect transactions and dispositions of
assets and; (B) maintain and have 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
(i) transactions are executed in accordance with management’s
general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements
in conformity with GAAP and to maintain accountability for their
assets; (iii) access to assets is permitted only in accordance
with management’s general or specific authorization; and
(iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(pp) Compliance
with the Sarbanes-Oxley Act . There is and has been no failure
on the part of the Partnership or any of the Partnership’s
directors or officers, in their capacities as such, to comply in
all material respects with any provision of the Sarbanes-Oxley Act
with which any of them is required to comply, including
Section 402 related to loans.
(qq) Absence of
Manipulation . No Partnership Entity has taken nor will any
Partnership Entity take, directly or indirectly, any action
designed to or that would constitute or that might reasonably be
expected to cause or result in the stabilization or manipulation of
the price of any security to facilitate the sale or resale of the
Securities.
(rr) No Right
of First Refusal . No Partnership Entity nor any other person
has any preemptive right, right of first refusal or other similar
right to purchase or otherwise acquire any of the Securities to be
sold by the Partnership to the Underwriters pursuant to this
Agreement.
(ss)
Statistical, Demographic or Market-Related Data . Any
statistical, demographic, market-related, customer-related or
production-related data included in the Registration Statement or
the Preliminary Prospectus is based on or derived from sources that
the Partnership believes to be reliable and accurate and all such
data included in the
14
Registration
Statement or the Preliminary Prospectus accurately reflects the
materials upon which it is based or from which it was
derived.
(tt) Lending
Relationship . Except as disclosed in the Registration
Statement, the Disclosure Package and the Prospectus, no
Partnership Entity has any lending relationship or other commercial
banking relationship with any bank or similar institution
affiliated with any of the Underwriters, and no Partnership Entity
intends to use any of the proceeds from the sale of the Securities
to repay any debt owed to any Underwriter or any affiliate of any
Underwriter.
(uu) No
Prohibition on Dividends by Subsidiaries . No subsidiary of the
Partnership is prohibited, directly or indirectly, from paying any
dividends or making any other distributions on such
subsidiary’s capital stock, from repaying any d
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