EXHIBIT 1
EXECUTION COPY
NORTHERN BORDER PARTNERS, L.P.
2,250,000
COMMON UNITS(1)
REPRESENTING LIMITED PARTNER INTERESTS
UNDERWRITING AGREEMENT
New York, New York
May 20, 2003
Citigroup Global Markets Inc.
UBS Warburg LLC
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
As Representatives of the Several Underwriters,
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Northern Border Partners, L.P., a limited partnership organized under
the laws of Delaware (the "PARTNERSHIP"), proposes to sell to the several
underwriters named in Schedule I hereto (the "UNDERWRITERS"), for whom you (the
"REPRESENTATIVES") are acting as representatives, 2,250,000 Common Units
("COMMON UNITS") of the Partnership (said units to be issued and sold by the
Partnership being hereinafter called the "UNDERWRITTEN SECURITIES"). The
Partnership also proposes to grant to the Underwriters an option to purchase up
to 337,500 additional Common Units to cover over-allotments (the "OPTION
SECURITIES"; the Option Securities, together with the Underwritten Securities,
being hereinafter called the "SECURITIES"). To the extent there are no
additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. The use of the neuter in this Agreement shall include the
feminine and masculine wherever appropriate. Any reference herein to the
Registration Statement, a Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or
before the Effective Date of the Registration Statement or the issue date of
such Preliminary Prospectus or the Prospectus, as the case may be; and any
reference herein to the terms "amend", "amendment" or "supplement" with respect
to the Registration Statement, any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include the filing of any document under the
Exchange Act after the Effective Date of the Registration Statement, or the
issue date of any Preliminary Prospectus or the Prospectus, as the case may be,
deemed to be incorporated therein by reference. Certain terms used herein are
defined in Section 18 hereof.
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1 Plus an option to purchase from the Partnership up to 337,500 additional
Securities to cover over-allotments.
1. Representations and Warranties.
(a) The Partnership and Northern Border Intermediate Limited
Partnership, a Delaware limited partnership (the "INTERMEDIATE PARTNERSHIP"),
jointly and severally represent and warrant to, and agree with, each Underwriter
as set forth below in this Section 1.
(i) The Partnership has prepared and filed with the Commission
two registration statements on Form S-3 (registration numbers
333-101469 and 333-72323) for registration under the Act of certain
securities of the Partnership, including the offering and sale of the
Securities; the Registration Statement combining prospectuses and
acting as a post-effective amendment pursuant to Rule 429 of the Act
(registration number 333-101469) has been declared effective by the
Commission, and no stop order suspending the effectiveness of the
Registration Statement has been issued by the Commission. At the time
of the filing of the Registration Statement, and on the date of this
Agreement, the Partnership met the requirements for use of Form S-3
under the Act. The Partnership may have filed one or more amendments or
supplements thereto, including a preliminary prospectus supplement
which relates to the base prospectus, each of which has previously been
furnished to you. The Partnership will next file with the Commission a
final prospectus supplement which relates to the base prospectus,
together with the base prospectus, in accordance with Rules 430A and
424(b). The Partnership has included in the Registration Statement, as
amended and supplemented at its Effective Date, all information (other
than Rule 430A Information) required by the Act to be included in the
Registration Statement. As filed, such final prospectus supplement,
together with the base prospectus, shall contain all Rule 430A
Information, together with all other such required information, and,
except to the extent the Representatives shall agree in writing to a
modification, shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the extent not
completed at the Execution Time, shall contain only such specific
additional information and other changes as the Partnership has advised
you, prior to the Execution Time, will be included or made therein.
(ii) On the Effective Date, the Registration Statement, did or
will, and when the Prospectus is first filed in accordance with Rule
424(b) and on the Closing Date (as defined herein) and on any date on
which Option Securities are purchased, if such date is not the Closing
Date (a "SETTLEMENT DATE"), the Prospectus (and any supplements
thereto) will, comply in all material respects with the applicable
requirements of the Act and the Exchange Act; on its Effective Date and
at the Execution Time, the Registration Statement did not or will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein not misleading; and on the date of filing
pursuant to Rule 424(b) and on the Closing Date and any settlement
date, the Prospectus (together with any supplement thereto) will not
include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the Partnership makes no representations or
warranties as to the information contained in or omitted from the
Registration Statement or the Prospectus (or any supplement thereto) in
reliance upon and in conformity with information furnished in writing
to the Partnership
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by or on behalf of any Underwriter through the Representatives
specifically for inclusion in the Registration Statement or the
Prospectus (or any supplement thereto).
(iii) The only significant subsidiaries (as defined in
Regulation S-X of under the Act) of the Partnership are the
Intermediate Partnership, Northern Border Pipeline Company, a Texas
general partnership ("NORTHERN BORDER PIPELINE"), Crestone Energy
Ventures, L.L.C., a Delaware limited liability company ("CRESTONE"),
Bear Paw Investments, LLC, a Delaware limited liability company ("BEAR
PAW INVESTMENTS"), and Bear Paw Energy, LLC, a Delaware limited
liability company ("BEAR PAW ENERGY"). Each of the Intermediate
Partnership, Northern Border Pipeline, Crestone, Bear Paw Investments,
Bear Paw Energy, Border Midwestern Company, a Delaware corporation
("BORDER MIDWESTERN"), Midwestern Gas Transmission Company, a Delaware
corporation ("MIDWESTERN GAS"), Border Viking Company, a Delaware
corporation ("BORDER VIKING"), and Viking Gas Transmission Company, a
Delaware corporation ("VIKING GAS"), was duly formed and is validly
existing and in good standing under the laws of its jurisdiction of
formation. Each such entity has, and at the Closing Date will have,
full power and authority to conduct the activities conducted by it, to
own or lease all the assets owned or leased by it and to conduct its
business in all material respects as described in the Registration
Statement and the Prospectus. Each such entity is, and at the Closing
Date will be, duly licensed or qualified to do business and in good
standing as a foreign entity in all jurisdictions in which the nature
of the activities conducted by it or the character of the assets owned
or leased by it makes such licensing or qualification necessary, except
for such jurisdictions in which the failure so to qualify or register
would not have a Material Adverse Effect or subject such entity or the
Partnership to any material liability or disability. All of the
outstanding equity interests of each such entity have been duly
authorized and validly issued and are owned directly or indirectly by
the Intermediate Partnership free and clear of all liens, encumbrances
and claims whatsoever (except for such liens, encumbrances, security
interests, equities, charges or claims as are not, individually or in
the aggregate, material or except as described in the Prospectus).
Crestone, directly or indirectly, owns (A) all of the membership
interests in Crestone Gathering Services, L.L.C., Crestone Wind River,
L.L.C. and Crestone Powder River, L.L.C., (B) a 49% common membership
interest in and preferred shares of Bighorn Gas Gathering, L.L.C., (C)
a 33.33% membership interest in Fort Union Gas Gathering, L.L.C., a
Delaware limited liability company ("FORT UNION"), and (D) a 35%
membership interest in Lost Creek Gathering, L.L.C., a Delaware limited
liability company ("LOST CREEK"), in each case free and clear of any
liens, claims or encumbrances (except that Crestone's member interests
in Fort Union and Lost Creek are or will be pledged to the lenders with
respect to those projects and except for such other liens,
encumbrances, security interests, equities, charges or claims as are
not, individually or in the aggregate, material or except as described
in the Prospectus). Viking Gas owns a one-third interest in Guardian
Pipeline, L.L.C., free and clear of any liens, claims or encumbrances
(except for such liens, encumbrances, security interests, equities,
charges or claims as are not, individually or in the aggregate,
material or except as described in the Prospectus). The Intermediate
Partnership owns a 70% general partner interest in Northern Border
Pipeline free and clear of any liens, claims or encumbrances (except
for such liens, encumbrances, security interests, equities, charges or
claims as are not, individually or in the aggregate, material or except
as described in the Prospectus).
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(iv) The Partnership has been duly formed and is validly
existing as a limited partnership under the Delaware Revised Uniform
Limited Partnership Act (the "DELAWARE ACT"), with all necessary
partnership power and authority to own or lease the properties it owns
or leases and to conduct the business it conducts in each case in all
material respects as described in the Registration Statement and the
Prospectus, and is duly qualified or registered as a foreign limited
partnership for the transaction of business under the laws of each
jurisdiction in which the failure so to qualify or register would have
a material adverse effect upon the Partnership or subject the
Partnership or the limited partners of the Partnership to any material
liability or disability.
(v) Northern Plains Natural Gas Company, a Delaware
corporation ("NORTHERN PLAINS") and wholly owned subsidiary of Enron
Corp., an Oregon corporation ("ENRON"), Pan Border Gas Company, a
Delaware corporation ("PAN Border") and wholly owned subsidiary of
Northern Plains, and Northwest Border Pipeline Company, a Delaware
corporation ("NORTHWEST BORDER") and wholly owned subsidiary of
TransCanada PipeLines Limited, an Alberta corporation ("TRANSCANADA")
(collectively, the "GENERAL PARTNERS"), are the only general partners
of the Partnership with general partner interests in the Partnership of
1.0% in the aggregate; such general partner interests are duly
authorized by the Agreement of Limited Partnership of the Partnership
(as it may be amended or restated at the Execution Date, the
"PARTNERSHIP AGREEMENT"), and were validly issued to the General
Partners and are fully paid (to the extent required under the
Partnership Agreement).
(vi) The General Partners are the sole general partners of the
Intermediate Partnership with general partner interests in the
Intermediate Partnership of 1.0101% in the aggregate subject to the
provisions of the Agreement of Limited Partnership of the Intermediate
Partnership (the "INTERMEDIATE PARTNERSHIP AGREEMENT"); such general
partner interests are duly authorized by the Intermediate Partnership
Agreement and were validly issued to the General Partners and are fully
paid (to the extent required under the Intermediate Partnership
Agreement) (the Intermediate Partnership Agreement and the Partnership
Agreement are herein collectively referred to as the "PARTNERSHIP
AGREEMENTS"). Complete and correct copies of the certificate of limited
partnership for each of the Partnership and the Intermediate
Partnership and of the Partnership Agreements, and all amendments
thereto have been delivered to the Underwriters, and no changes therein
will be made subsequent to the date hereof and prior to the Closing
Date.
(vii) The limited partners of the Partnership hold limited
partner interests in the Partnership aggregating 99.0%, such limited
partner interests being represented by 43,809,714 Common Units,
excluding Securities sold or which may be sold by the Partnership
hereunder; such limited partner interests are the only limited partner
interests of the Partnership that are issued and outstanding; the
limited partner interests represented thereby are authorized by the
Partnership Agreement, were validly issued and are fully paid (to the
extent required under the Partnership Agreement) and non-assessable
(except as described in the Partnership Agreement and except as set
forth in Section 17-607 of the Delaware Act).
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(viii) The Partnership is the sole limited partner of the
Intermediate Partnership, with a limited partner interest of 98.9899%
(subject to the provisions of the Intermediate Partnership Agreement);
such limited partner interest is authorized by the Intermediate
Partnership Agreement, was validly issued in accordance with the
Intermediate Partnership Agreement and is fully paid (to the extent
required under the Intermediate Partnership Agreement) and
non-assessable (except as described in the Intermediate Partnership
Agreement and except as set forth in Section 17-607 of the Delaware
Act); the Partnership owns, directly or indirectly, such limited
partner interest in the Intermediate Partnership free and clear of all
liens, encumbrances, security interests, equities, charges or claims
(except for such liens, encumbrances, security interests, equities,
charges or claims as are not, individually or in the aggregate,
material or except as described in the Registration Statement or
Prospectus).
(ix) Except as described in the Prospectus or contained in the
Partnership Agreements and except for (A) rights granted pursuant to
that certain Exchange Agreement dated May 31, 1997 among the
Intermediate Partnership, the Partnership and the stockholders of
▇▇▇▇▇▇▇▇ Technologies, Inc. and (B) rights granted pursuant to that
certain Exchange Agreement dated December 29, 1997 between the
Partnership and Central Pacific Resources Partnership, there are no
preemptive rights or other rights to subscribe for or to purchase, nor
any restriction upon the voting or transfer of (except in the case of
restrictions on transfer for securities issued by the Partnership in
reliance on Section 4(2) of the Act), any limited partner interests in
the Partnership or the Intermediate Partnership pursuant to either of
the Partnership Agreements or other governing documents or any
agreement or other instrument to which the Partnership or the
Intermediate Partnership is a party or by which either of them may be
bound. The Common Units conform in all material respects to the
description of the Common Units contained in the Prospectus. Except as
described above, there are no outstanding options or warrants to
purchase any Common Units.
(x) None of the Partnership or its subsidiaries has sustained
since the date of the latest audited financial statements incorporated
by reference in the Registration Statement any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus or such losses or
interferences that would not have a Material Adverse Effect; and, since
the date as of which information is given in the Prospectus, there has
not been any material adverse change in the capitalization or long-term
debt of the Partnership and its subsidiaries taken as a whole or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, or results of operations of the
Partnership and its subsidiaries taken as a whole, otherwise than as
set forth or contemplated in the Prospectus.
(xi) The Partnership and its Subsidiaries have good and
indefeasible title to all real and personal property necessary to own
and operate their businesses in all material respects as described in
the Prospectus, free and clear of all liens, claims, encumbrances and
defects except (A) as described in the Prospectus and (B) such as do
5
not materially interfere with the ownership, operation or benefits of
ownership of such businesses or materially increase the cost of
operation or ownership of such businesses, provided that, (1) with
respect to the gas transmission and gathering pipelines of Northern
Border Pipeline, Crestone, Bear Paw Energy, Midwestern Gas and Viking
Gas, and right-of-way interests related thereto (the "PIPELINE
PROPERTIES") the foregoing shall only constitute a representation that,
except as described in the Prospectus, (y) Northern Border Pipeline,
Crestone, Bear Paw Energy, Midwestern Gas and Viking Gas have
sufficient title to enable them to use such Pipeline Properties in
their businesses as they have been used in the past and as are proposed
to be used in the future as described in the Prospectus and (z) any
lack of title has not had and will not have any material adverse effect
on the ability of Northern Border Pipeline, Crestone, Bear Paw Energy,
Midwestern Gas and Viking Gas to use such Pipeline Properties as they
have been used in the past and are proposed to be used in the future as
described in the Prospectus and will not materially increase the cost
of such use, and (2) with respect to any real property, buildings and
equipment held under lease by Northern Border Pipeline, Crestone, Bear
Paw Energy, Midwestern Gas or Viking Gas, such real property, buildings
and equipment are held by Northern Border Pipeline, Crestone, Bear Paw
Energy, Midwestern Gas or Viking Gas under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such real
property, buildings and equipment by such person.
(xii) None of the Partnership or its subsidiaries is in, nor
will the sale of the Securities by the Partnership and the compliance
by the Partnership and the Intermediate Partnership with all of the
provisions of this Agreement and the consummation of the transactions
contemplated herein and in the Prospectus to be consummated at the
Closing Date result in (A) a breach or violation of any of the terms or
provisions of, or a default under (or an event that with notice or
lapse of time or both would constitute such a default), any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Partnership or any of its subsidiaries is a
party or by which any of them is bound or to which any of the property
or assets of any of them is subject, (B) any violation of the
provisions of the agreement of limited partnership, charter or other
governing documents of the Partnership or any of its subsidiaries
(except for the failure to mail the reports identified in Section
8.3(a) and (b) of the Partnership Agreement), or (C) any statute or any
order, rule, ordinance, regulation or decree of any court or
governmental agency or body having jurisdiction over the Partnership or
any of its subsidiaries or any of their properties, except in the case
of (A) and (C) above for any breach, violation or default that would
not, individually or in the aggregate, have a Material Adverse Effect
or a material adverse effect upon the holders of Common Units; and no
consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is required
for the sale of the Securities or the consummation by the Partnership
of the transactions contemplated herein and in the Prospectus to be
consummated at the Closing Date, except for (A) such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters, and
(B) such consents, approvals, authorizations, orders, registrations or
qualifications (1) as have been obtained or will be obtained prior to
the Closing Date or (2) that, if not obtained, would not, individually
or
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in the aggregate, have a Material Adverse Effect or a material adverse
effect upon the holders of Common Units. The offering and sale of the
Securities as contemplated by this Agreement does not give rise to any
rights, other than those which have been waived or satisfied, for or
relating to the registration of any Common Units or other securities of
the Partnership or which would require the inclusion of any Common
Units or other securities of the Partnership in such offering and sale
of the Securities pursuant to "tag along" or other such rights. None of
the Partnership nor any of its subsidiaries has failed to obtain any
license, permit, certificate, franchise or other governmental
authorization or permit necessary to the ownership of its property or
the conduct of its business, except for those the failure of which to
obtain will not have a Material Adverse Effect or a material adverse
effect upon the holders of Common Units.
(xiii) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Partnership or
any of its subsidiaries is a party or of which any of their respective
properties is the subject which, if determined adversely to such
person, could reasonably be expected to individually or in the
aggregate have (A) a material adverse effect on the performance of this
Agreement or the consummation of any of the transactions contemplated
hereby or (B) a Material Adverse Effect; and, to the best of the
Partnership's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(xiv) KPMG LLP, who have certified certain financial
statements of Northern Border Pipeline, are independent public
accountants with respect to Northern Border Pipeline, the Intermediate
Partnership and the Partnership as required by the Act.
(xv) (A) This Agreement has been duly authorized, executed and
delivered by each of the Partnership and the Intermediate Partnership
and constitutes the valid and binding agreement of each such person
(subject to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and
general equitable principles), (B) the Partnership Agreement has been
duly authorized, executed and delivered by the General Partners and is
a valid and legally binding agreement of the General Partners,
enforceable against the General Partners in accordance with its terms,
and (C) the Intermediate Partnership Agreement has been duly
authorized, executed and delivered by the parties thereto and is a
valid and legally binding agreement of such parties, enforceable
against the General Partners in accordance with its terms, except as
the enforceability of the Partnership Agreements may be affected by (1)
the matters described in the Prospectus and (2) bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and general equitable principles.
(xvi) Each of the Partnership and its subsidiaries carries, or
is covered by, insurance in such amounts and covering such risks as is
customarily obtained by businesses similarly situated, taking into
account self-insurance except where a failure to carry or be covered by
such insurance would not have a Material Adverse Effect.
(xvii) Neither the Partnership nor any of its subsidiaries is
a holding company or public utility company, as such terms are defined
in PUHCA; and the
7
petition for review filed with the Commission by Enron Corp. on
February 27, 2003 and described under "Risk Factors" in the preliminary
prospectus filed by the Partnership with the Commission on May 19, 2003
stays the effect of the initial decision of the administrative law
judge described therein, with the result that none of the Partnership
or its subsidiaries is a subsidiary or affiliate of a holding company,
as such terms are defined in PUHCA, other than of an exempt holding
company as that term is used in Section 3(a) of PUHCA.
(xviii) None of the Partnership or its subsidiaries is, or at
the Closing Date, will be an "investment company" as that term is
defined in the Investment Company Act of 1940, as amended (the
"INVESTMENT COMPANY ACT"), and the rules and regulations thereunder.
(xix) Except as described in the Prospectus, the Partnership
and its subsidiaries possess, and are operating in compliance in all
material respects with, all certificates, authorities or permits issued
by the appropriate local, state, federal or foreign regulatory agencies
or bodies necessary to conduct the business currently (or, as described
or contemplated in the Prospectus, to be) operated by them, except for
such certificates, authorizations or permits which, if not obtained,
would not reasonably be expected to have, individually or in the
aggregate, a material adverse effect upon the ability of the
Partnership and its subsidiaries taken as a whole to conduct their
businesses in all material respects as currently conducted and as
contemplated by the Prospectus to be conducted; and, except as
described in the Prospectus, none of the Partnership or its
subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such certificate, authorization or
permit which, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would reasonably be expected
to have a material adverse effect upon the ability of the Partnership
and its subsidiaries taken as a whole to conduct their businesses in
all material respects as currently conducted and as contemplated by the
Prospectus to be conducted.
(xx) Neither the Partnership nor the Intermediate Partnership
has taken, directly or indirectly, any action designed to cause or
result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price
of the Common Units to facilitate the sale or resale of the Common
Units in violation of any law, rule or regulation.
(xxi) The financial statements of the Partnership (including
the related notes and supporting schedules) filed as part of the
Registration Statement or included in the Prospectus present fairly in
all material respects the consolidated financial condition, results of
operations and cash flows of the Partnership and its subsidiaries at
the dates and for the periods indicated, and have been prepared in
conformity with generally accepted accounting principles (except as
otherwise described therein) applied on a consistent basis throughout
the periods involved.
(xxii) The Partnership maintains a system of internal
accounting control sufficient to provide reasonable assurance that (A)
transactions of the Partnership and its subsidiaries are executed in
accordance with management's general or specific
8
authorization; (B) transactions are recorded as necessary to permit
preparation of consolidated financial statements of the Partnership and
its subsidiaries in conformity with generally accepted accounting
principles and to maintain accountability for assets of the Partnership
and its subsidiaries; (C) access to assets of the Partnership and its
subsidiaries is permitted only in accordance with management's general
or specific authorization; and (D) the recorded accountability for
assets of the Partnership and its subsidiaries is compared with
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(xxiii) The Partnership and its subsidiaries (A) are in
compliance with any and all applicable foreign, federal, state and
local laws and regulations relating to the protection of human health
and safety, the environment or imposing liability or standards of
conduct concerning any Hazardous Material (as hereinafter defined)
("ENVIRONMENTAL LAWS"), (B) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (C) are in compliance with all
terms and conditions of any such permit, license or approval, except
where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would
not, individually or in the aggregate, result in a Material Adverse
Effect. The term "HAZARDOUS MATERIAL" means (A) any "hazardous
substance" as defined by the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, (B) any "hazardous
waste" as defined by the Resource Conservation and Recovery Act, as
amended, (C) any petroleum or petroleum product, (D) any
polychlorinated biphenyl and (E) any pollutant or contaminant or
hazardous, dangerous, or toxic chemical, material, waste or substance
regulated under or within the meaning of any other Environmental Law.
(xxiv) In the ordinary course of their businesses, the
Partnership and its subsidiaries conduct a periodic review of the
effect of Environmental Laws on the business, operations and properties
of the Partnership and its subsidiaries, in the course of which they
identify and evaluate associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental Laws
or any permit, license or approval, any related constraints on
operating activities and any potential liabilities to third parties).
Except as set forth in the Registration Statement and the Prospectus
there are no costs and liabilities associated with or arising in
connection with Environmental Laws as currently in effect (including,
without limitation, costs of compliance therewith) which would,
individually or in the aggregate have a Material Adverse Effect.
(xxv) Neither the Partnership nor the Intermediate Partnership
is aware of any non-compliance with any federal, state and local
employment and labor laws by either of them or by Northern Plains or
NBP Services Corporation, a Delaware corporation, including, but not
limited to, laws relating to non-discrimination in hiring, promotion
and pay of employees; neither the Partnership nor the Intermediate
Partnership is aware of any labor dispute involving the employees of
Northern Plains or NBP Services Corporation or, to the knowledge of the
Partnership or the Intermediate Partnership, is imminent or threatened;
and neither the Partnership nor the Intermediate
9
Partnership is aware of any existing, imminent or threatened labor
disturbance by the employees of any of its principal subsidiaries,
suppliers, manufacturers or contractors that could result in a Material
Adverse Effect.
(xxvi) The outstanding Common Units are listed for trading on
the New York Stock Exchange, and the Securities to be sold by the
Partnership pursuant to this Agreement have been approved for listing
on the New York Stock Exchange upon official notice of issuance.
(xxvii) For purposes of Section 414(b) or (c) of the Internal
Revenue Code of 1986, as amended (the "CODE"), and Section 4001 of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
none of the Partnership, the Intermediate Partnership, Northern Border
Pipeline or any other entity controlled by any of them is controlled by
or under common control with Enron or any of its subsidiaries.
Any certificate signed by any officer of the Partnership or
Intermediate Partnership and addressed and delivered to the Representatives at
the Closing shall be deemed a representation and warranty by the Partnership and
Intermediate Partnership, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale.
(a) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Partnership hereby agrees
to sell to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Partnership, at a purchase price of $ 38.779 per
Common Unit, the amount of the Underwritten Securities set forth opposite such
Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Partnership hereby grants
an option to the several Underwriters to purchase, severally and not jointly, up
to 337,500 Option Securities at the same purchase price per share as the
Underwriters shall pay for the Underwritten Securities. Said option may be
exercised only to cover over-allotments in the sale of the Underwritten
Securities by the Underwriters. Said option may be exercised in whole or in part
at any time on or before the 30th day after the date of the Prospectus upon
written or telegraphic notice by the Representatives to the Partnership setting
forth the number of units of the Option Securities as to which the several
Underwriters are exercising the option and the settlement date. The number of
Option Securities to be purchased by each Underwriter shall be the same
percentage of the total number of units of the Option Securities to be purchased
by the several Underwriters as such Underwriter is purchasing of the
Underwritten Securities, subject to such adjustments as you in your absolute
discretion shall make to eliminate any fractional units.
3. Delivery and Payment. Delivery of and payment for the Underwritten
Securities and the Option Securities (if the option provided for in Section 2(b)
hereof shall have been exercised on or before the third Business Day prior to
the Closing Date) shall be made at 10:00 AM, New York City time, on May 23,
2003, or at such time on such later date not more than three Business Days after
the foregoing date as the Representatives shall designate, which
10
date and time may be postponed by agreement among the Representatives and the
Partnership or as provided in Section 9 hereof (such date and time of delivery
and payment for the Securities being herein called the "CLOSING DATE"). Delivery
of the Securities shall be made to the Representatives for the respective
accounts of the several Underwriters against payment by the several Underwriters
through the Representatives of the respective aggregate purchase prices of the
Securities being sold by the Partnership to or upon the order of the Partnership
by wire transfer payable in same-day funds to the accounts specified by the
Partnership. Delivery of the Underwritten Securities and the Option Securities
shall be made through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised
after the third Business Day prior to the Closing Date, the Partnership will
deliver the Option Securities (at the expense of the Partnership) to the
Representatives, at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ the date
specified by the Representatives (which shall be within three Business Days
after exercise of said option) for the respective accounts of the several
Underwriters, against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Partnership by wire transfer payable in same-day funds to the account(s)
specified by the Partnership. If settlement for the Option Securities occurs
after the Closing Date, the Partnership will deliver to the Representatives on
the settlement date for the Option Securities, and the obligation of the
Underwriters to purchase the Option Securities shall be conditioned upon receipt
of, supplemental opinions, certificates and letters confirming as of such date
the opinions, certificates and letters delivered on the Closing Date pursuant to
Section 6 hereof.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Prospectus.
5. Agreements.
(a) The Partnership and the Intermediate Partnership agree
with the several Underwriters that:
(i) Prior to the termination of the offering of the
Securities, the Partnership will not file any amendment to the
Registration Statement, any supplement to the Prospectus or any Rule
462(b) Registration Statement unless the Partnership has furnished you
a copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, if the Registration Statement has
become or becomes effective pursuant to Rule 430A, or filing of the
Prospectus is otherwise required under Rule 424(b), the Partnership
will cause the Prospectus, properly completed, and any supplement
thereto to be filed in a form approved by the Representatives with the
Commission pursuant to the applicable paragraph of Rule 424(b) within
the time period prescribed and will provide evidence satisfactory to
the Representatives of such timely filing. The Partnership will
promptly advise the Representatives (A) when the Registration
Statement, if not effective at the Execution Time, shall have become
effective, (B) when the Prospectus, and any supplement thereto, shall
have been filed (if required) with the Commission pursuant to Rule
424(b) or when any Rule 462(b) Registration Statement shall have been
filed with
11
the Commission, (C) when, prior to termination of the offering of the
Securities, any amendment of the Registration Statement shall have been
filed or become effective, (D) of any request by the Commission or its
staff for any amendment of the Registration Statement, or any Rule
462(b) Registration Statement, or for any supplement to the Prospectus
or for any additional information, (E) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceeding for that purpose and (F) of the receipt by the Partnership
of any notification with respect to the suspension of the qualification
of the Securities for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose. The Partnership and the
Intermediate Partnership will use their best efforts to prevent the
issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(ii) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then supplemented would include
any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or if it shall
be necessary to amend the Registration Statement or supplement the
Prospectus to comply with the Act or the Exchange Act, the Partnership
promptly will (A) notify the Representatives of such event, (B) prepare
and file with the Commission, subject to the second sentence of
paragraph (a)(i) of this Section 5, an amendment or supplement which
will correct such statement or omission or effect such compliance and
(C) supply any supplemented Prospectus to you in such quantities as you
may reasonably request.
(iii) As soon as practicable, the Partnership will make
generally available to its security holders and to the Representatives
an earnings statement or statements of the Partnership and its
subsidiaries which will satisfy the provisions of Section 11(a) of the
Act and Rule 158 under the Act.
(iv) The Partnership will furnish to the Representatives and
counsel for the Underwriters, without charge, one signed copy of the
Registration Statement (including exhibits thereto) and to each other
Underwriter a copy of the Registration Statement (without exhibits
thereto) and, so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Act, as many copies of each Preliminary
Prospectus and the Prospectus and any supplement thereto as the
Representatives may reasonably request. The Partnership will pay the
expenses of printing or other production of all documents relating to
the offering.
(v) The Partnership will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate, will maintain such
qualifications in effect so long as required for the distribution of
the Securities and will pay any fee of the National Association of
Securities Dealers, Inc., in connection with its review of the
offering; provided that in no event shall the Partnership be obligated
to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to service of
process
12
in suits, other than those arising out of the offering or sale of the
Securities, in any jurisdiction where it is not now so subject.
(vi) The Partnership will not, without the prior written
consent of Citigroup Global Markets Inc., offer, sell, contract to
sell, pledge, or otherwise dispose of, (or enter into any transaction
which is designed to, or might reasonably be expected to, result in the
disposition (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the Partnership or
any affiliate of the Partnership or any person in privity with the
Partnership or any affiliate of the Partnership) directly or
indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish
or increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Exchange
Act, any other Common Units or any securities convertible into, or
exercisable, or exchangeable for, Common Units; or publicly announce an
intention to effect any such transaction, for a period of ninety (90)
days after the date of this Agreement, provided, however, that the
Partnership may issue and sell Common Units pursuant to any employee
unit option plan, unit ownership plan or dividend reinvestment plan of
the Partnership in effect at the Execution Time and the Partnership may
issue Common Units issuable upon the conversion of securities or the
exercise of warrants outstanding at the Execution Time.
(vii) The Partnership will comply with all applicable
securities and other applicable laws, rules and regulations, including,
without limitation, the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, and will use its
best efforts to cause the members of its Partnership Policy Committee
and Audit Committee and its officers, in their capacities as such, to
comply with such laws, rules and regulations, including, without
limitation, the provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
(viii) The Partnership will not take, directly or indirectly,
any action designed to or that would constitute or that might
reasonably be expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security
of the Partnership to facilitate the sale or resale of the Securities.
6. Conditions to the Obligations of the Underwriters. The obligations
of the Underwriters to purchase the Underwritten Securities and the Option
Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Partnership and the
Intermediate Partnership contained herein as of the Execution Time, the Closing
Date and any settlement date pursuant to Section 3 hereof, to the accuracy of
the statements of the Partnership and the Intermediate Partnership made in any
certificates pursuant to the provisions hereof, to the performance by the
Partnership of its obligations hereunder and to the following additional
conditions:
(a) If filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424(b), the Prospectus, and any such supplement, will
be filed in the manner and within the time period required by Rule 424(b); and
no stop order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for that purpose shall have been instituted
or threatened.
13
(b) The Partnership shall have requested and caused ▇▇▇▇▇▇▇ &
▇▇▇▇▇ L.L.P., counsel for the Partnership, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to the
Representatives, and in form and substance satisfactory to you and your counsel,
to the effect that:
(i) Each of the Partnership and the Intermediate Partnership
has been duly formed and is validly existing as a limited partnership
under the Delaware Act, with full partnership power and authority under
the Delaware Act and the Partnership Agreement and the Intermediate
Partnership Agreement, respectively, necessary to own, lease and
operate its properties and conduct its business as described in the
Prospectus;
(ii) The General Partners are the sole general partners of
each of the Partnership and the Intermediate Partnership with a
combined general partner interest in the Partnership of 1.0% and a
combined general partner interest in the Intermediate Partnership of
1.0101% (subject to the provisions of the Partnership Agreement and the
Intermediate Partnership Agreement, respectively); such general partner
interests are duly authorized by the Partnership Agreement and the
Intermediate Partnership Agreement, respectively, are validly issued
and fully paid (to the extent required by the Partnership Agreement and
Intermediate Partnership Agreement) and are owned of record by the
General Partners free and clear of all liens, encumbrances, security
interests, equities, charges or claims of record (except as provided in
the Partnership Agreement, the Intermediate Partnership Agreement or
the Northern Border Pipeline Partnership Agreement or pursuant to the
Delaware Act, as amended) (A) in respect of which a financing statement
under the Uniform Commercial Code of the State of Delaware naming a
General Partner as debtor is on file in the offices of the Secretary of
State of the State of Delaware or (B) otherwise known to us;
(iii) The Partnership is the sole limited partner of the
Intermediate Partnership, with a limited partner interest in the
Intermediate Partnership of 98.9899% (subject to the provisions of the
Intermediate Partnership Agreement); such limited partner interest is
duly authorized by the Intermediate Partnership Agreement and is
validly issued, fully paid and non-assessable, except as provided in
Sections 17-303(a) and 17-607 of the Delaware Act; and the Partnership
owns such limited partner interest in the Intermediate Partnership free
and clear of all liens, encumbrances, security interests, equities,
charges or claims of record (except as provided in the Intermediate
Partnership Agreement or pursuant to the Delaware Revised Uniform
Limited Partnership Act, as amended) (A) in respect of which a
financing statement under the Uniform Commercial Code of the State of
Delaware naming the Partnership as debtor is on file in the offices of
the Secretary of State of the State of Delaware or (B) otherwise known
to us;
(iv) Immediately prior to the closing under this Agreement,
the limited partners of the Partnership held limited partner interests
in the Partnership aggregating 99.0% (subject to the provisions of the
Partnership Agreement); such limited partner interests are represented
by 43,809,714 Common Units; such limited partner interests and the
Securities sold by the Partnership at the closing will be the only
limited partner interests of the Partnership that are issued and
outstanding immediately following the closing under this Agreement; the
Securities sold by the Partnership at the closing are
14
authorized by the Partnership Agreement and are validly issued, fully
paid and non-assessable, except as provided in Sections 17-303(a) and
17-607 of the Delaware Act;
(v) Insofar as such descriptions relate to legal matters or
descriptions of provisions of the governing instruments, the Common
Units conform in all material respects to the descriptions thereof
contained in the Prospectus;
(vi) Except as described in the Prospectus and contained in
the Partnership Agreements and except for (A) rights granted pursuant
to that certain Exchange Agreement dated May 31, 1997 among the
Intermediate Partnership, the Partnership and the stockholders of
▇▇▇▇▇▇▇▇ Technologies, Inc. and (B) rights granted pursuant to that
certain Exchange Agreement dated December 29, 1997 between the
Partnership and Central Pacific Resources Partnership, there are no
preemptive or other rights to subscribe for or to purchase any limited
partner interests of the Partnership or the Intermediate Partnership
pursuant to the Partnership Agreements or, to our knowledge, pursuant
to any other agreement or instrument to which the Partnership or the
Intermediate Partnership is a party; and except as described in the
Prospectus and except for restrictions on transfer of securities issued
by the Partnership in reliance on Section 4(2) of the Act, there are no
restrictions upon the voting or transfer of any limited partner
interests of the Partnership or the Intermediate Partnership pursuant
to the Partnership Agreements or, to our knowledge, pursuant to any
other agreement or instrument to which the Partnership or the
Intermediate Partnership is a party;
(vii) Registration Statement (registration number 333-101469)
combining prospectuses and acting as a post-effective amendment no. 1
to Registration Statement (registration number 333-72323) was declared
effective under the Act on December 18, 2002; the Prospectus was filed
with the Commission pursuant to subparagraph (2) of Rule 424(b) on May
21, 2003; and no stop order suspending the effectiveness of the
Registration Statement has been issued and, to our knowledge, no
proceeding for that purpose is pending or threatened by the Commission;
(viii) The Registration Statement and the Prospectus and any
further amendments or supplements thereto made by the Partnership prior
to the Closing Date (other than the financial statements and related
schedules or other financial or statistical data and the projected data
included therein, as to which we express no opinion) comply as to form
in all material respects with the requirements of the Act;
(ix) To our knowledge, there are no contracts or other
documents that are required to be summarized or described in the
Prospectus or filed as exhibits to the Registration Statement by the
Act that have not been summarized, described or incorporated by
reference in the Prospectus or filed as exhibits to the Registration
Statement;
(x) The statements contained in the Base Prospectus under the
captions "Tax Considerations," and in the Prospectus under the caption
"Prospectus Supplement Summary - Tax Considerations" insofar as they
describe federal statutes, rules and regulations, constitute a fair
summary thereof that is accurate in all material
15
respects; subject to the qualifications and assumptions stated therein,
our opinion dated November 26, 2002 filed as Exhibit 8.1 to the
Registration Statement is confirmed, and you may rely upon such opinion
as if it were dated the date hereof and addressed to you;
(xi) This Agreement has been duly authorized, executed and
delivered by each of the Partnership and the Intermediate Partnership;
assuming due authorization, execution and delivery by, and the
validity, legally binding effect and enforceability with respect to,
the other parties thereto, the General Partnership Agreement governing
Northern Border Pipeline, as amended and in effect on the date hereof,
and each of the Partnership Agreements constitute valid and legally
binding agreements of each of the Partnership, the Intermediate
Partnership and the General Partners (in each case, to the extent a
party thereto) and are enforceable against each such party in
accordance with their respective terms, subject to the qualifications
that (A) the enforceability of each such agreement may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and other similar laws of general applicability relating to or
affecting the rights of creditors generally, (B) the enforceability of
each such agreement may be limited by public policy, applicable law
relating to fiduciary duties and the judicial imposition of an implied
covenant of good faith and fair dealing, (C) the enforceability of
equitable rights and remedies provided for in each such agreement is
subject to equitable defenses and judicial discretion, and (D) the
enforceability of certain other provisions of each such agreement may
be limited by applicable laws and court decisions, none of which should
materially and adversely interfere with the practical realization of
the material benefits intended to be provided by such agreements;
(xii) The compliance by each of the Partnership and the
Intermediate Partnership with all of the provisions of this Agreement
will not, with the passage of time or upon stated contingency or
otherwise, (A) conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under, any of
the agreements filed or incorporated by reference as exhibits to the
Partnership's Annual Report on Form 10-K for the year ended December
31, 2002 (the "2002 10-K") or any report filed by the Partnership with
the Commission subsequent to the filing of the 2002 10-K, or (B) result
in any breach or violation of the provisions of the certificate of
limited partnership of the Partnership or the Intermediate Partnership
or of any statute or any rule or regulation of any governmental agency
or body having jurisdiction over either of such entities or its
properties, excluding in each case any breaches or violations which,
individually or in the aggregate, would not have a Material Adverse
Effect or a material adverse effect on the holders of the Common Units;
(xiii) Except as described in the Prospectus, or as provided
in the Partnership Agreements and the Acquisition Agreement, dated
March 14, 2001, among the Partnership, the Intermediate Partnership,
Bear Paw Investments, Bear Paw Energy and the other parties named
therein, to our knowledge there are no contracts, agreements or
understandings between the Partnership, the Intermediate Partnership or
the General Partners and any person granting such person the right to
require the Partnership to file a registration statement under the Act
with respect to any securities of the Partnership owned or to be owned
by such person or to require the Partnership to include such securities
in the securities registered pursuant to the Registration Statement or
in any
16
securities being registered pursuant to any other registration
statement filed by the Partnership under the Act; and none of such
rights described in this paragraph would require any such securities to
be included in the offering and sale of the Securities;
(xiv) Neither the Partnership nor the Intermediate Partnership
is an "investment company" as that term is defined in the Investment
Company Act and the rules and regulations thereunder and each General
Partner is either (A) not an "investment company" as that term is
defined in the Investment Company Act and the rules and regulations
thereunder or (B) exempt from the Investment Company Act;
(xv) Neither the Partnership nor any of its subsidiaries is a
holding company or public utility company, as such terms are defined in
PUHCA; and, in the absence of additional relevant subsequent action by
the Commission, the petition for review filed with the Commission by
Enron Corp. on February 27, 2003 and described under "Risk Factors" in
the Prospectus stays the effect of the initial decision of the
administrative law judge described therein until such time as the
Commission acts on the petition, with the result that as of the Closing
Date none of the Partnership or any of its subsidiaries is a subsidiary
or affiliate of a holding company, as such terms are defined in PUHCA,
other than of an exempt holding company as that term is used in Section
3(a) of PUHCA (provided, such counsel may state that this opinion is
based on such counsel's lack of knowledge of any relevant action by the
Commission subsequent to the filing of the petition, other than the
response filed by the Division of Investment Management on March 25,
2003);
(xvi) No consent, approval, authorization, order, registration
or qualification of or with any federal governmental agency or body or
any governmental agency or body of the State of Texas is required for
the sale of the Common Units or the consummation by any of the
Partnership, the Intermediate Partnership, the General Partners of the
transactions contemplated by this Agreement and the Prospectus, except
such consents, approvals, authorizations, orders, registrations or
qualifications (A) as have been obtained, (B) as may be required under
state securities or Blue Sky laws, or (C) which, if not obtained, would
not, individually or in the aggregate, have a material adverse effect
upon the ability of the Partnership and the Intermediate Partnership to
conduct their business as described in the Prospectus; and
(xvii) Northern Border Pipeline is validly existing as a
general partnership under the laws of the State of Texas, with full
partnership power and authority to own, lease and operate its
properties and conduct its business in all material respects as
described in the Prospectus.
In addition, such counsel shall state that in the course of
preparation by the Partnership of the Registration Statement, the Preliminary
Prospectus and the Prospectus, such counsel participated in conferences with
officers and other representatives of the Partnership and certain of its
subsidiaries, representatives of the independent public accountants of the
Partnership and, in the case of the Preliminary Prospectus and the Prospectus,
your representatives, at which the contents of the Registration Statement, the
Preliminary Prospectus and Prospectus and related matters were discussed. Such
counsel shall also state that although
17
they have not conducted any independent investigation with regard to the
information set forth in the Registration Statement or the Prospectus (except
with respect to the foregoing opinions) and are not (except as aforesaid)
passing upon and do not assume any responsibility for the accuracy, completeness
or fairness of the statements contained therein, on the basis of the foregoing,
no facts have come to such counsel's attention that cause such counsel to
believe that the Registration Statement or any amendment thereto on its
Effective Date, or as supplemented or amended at the Closing Date, contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or that, as of its date or the Closing Date, the Prospectus or any further
amendment or supplement thereto contained an untrue statement of a material fact
or omitted a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. In making such statement, such counsel may state that they
do not express any comment with respect to the financial statements and related
schedules and other financial data included or incorporated by reference in the
Registration Statement or in the Prospectus or any further amendment or
supplement thereto (including, without limitation, statements relating to
projected cash distributions to the limited partners of the Partnership) or any
statement contained therein or omitted therefrom in reliance upon and in
conformity with written information furnished to the Partnership by any
Underwriter through you expressly for use therein.
In rendering such opinion, such counsel may rely (a) as to
matters involving the application of the Delaware Act, the Delaware Limited
Liability Company Act, the Delaware General Corporation Law and the laws of the
States of New York and Texas, to the extent they deem proper and specified in
such opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the Underwriters
and (b) as to matters of fact, to the extent they deem proper, on certificates
of responsible officers of the Partnership and public officials. References to
the Prospectus in this paragraph (b) include any supplements thereto at the
Closing Date.
(c) The Partnership shall have requested and caused ▇▇▇▇▇ ▇.
Place, Esq., General Counsel of Northern Plains, to have furnished to the
Representatives her opinion with respect to the Common Units, dated the Closing
Date and addressed to the Representatives and in a form and substance
satisfactory to you and your counsel, to the effect that:
(i) Other than as set forth in the Prospectus, to
her knowledge there are no legal or governmental proceedings pending to
which the Partnership or any of the Subsidiaries is a party or of which
any property of any of them is the subject which, if determined
adversely to such person, would individually or in the aggregate have a
Material Adverse Effect; and, to her knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(ii) To her knowledge there are no jurisdictions in
which the Partnership or the Intermediate Partnership owns or leases
property or conducts business so as to require qualification or
registration to conduct business as a foreign limited partnership,
except where the failure to so qualify or register would not (A) have a
material adverse effect upon the Partnership, the Intermediate
Partnership or the General
18
Partners or (B) subject the limited partners of the Partnership to any
material liability or disability;
(iii) Except as described in the Prospectus, to her
knowledge each of the Partnership and its Subsidiaries possesses, and
is operating in compliance in all material respects with, all
certificates, authorities or permits issued by the appropriate local,
state or federal regulatory agencies or bodies necessary to conduct its
businesses as they are currently conducted as described in the
Prospectus, except for such certificates, authorizations or permits
which, if not obtained, would not reasonably be expected to have,
individually or in the aggregate, a material adverse effect upon the
ability of the Partnership and each of its Subsidiaries to conduct its
businesses in all material respects as currently conducted as described
in the Prospectus; to her knowledge, the Partnership and each of its
Subsidiaries possesses all certificates, authorities or permits issued
by the appropriate local, state or federal regulatory agencies or
bodies necessary to conduct its businesses as proposed to be conducted
as described in the Prospectus, except for (A) certificates,
authorizations or permits that, if not obtained, would not reasonably
be expected to have, individually or in the aggregate, a Material
Adverse Effect; and (B) certificates, authorizations or permits that
are reasonably expected to be obtained in the ordinary course of
business; and, except as described in the Prospectus, none of the
Partnership or any of its Subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
certificate, authorization or permit which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would be expected to have a Material Adverse Effect; all
government regulations, authorizations and procedures which affect the
Partnership or any of its Subsidiaries and the operation of their
respective businesses and that are required to be described in the
Prospectus are as described therein;
(iv) The Partnership and each of its Subsidiaries
(A) is in compliance with any and all applicable Environmental Laws,
(B) has received all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct its businesses and
(C) is in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with Environmental
Laws, failure to receive required permits, licenses or other approvals
or failure to comply with the terms and conditions of such permits,
licenses or approvals would not, individually or in the aggregate,
result in a Material Adverse Effect; provided, such counsel may qualify
such opinions to her knowledge with respect to Subsidiaries other than
the Intermediate Partnership, Northern Border Pipeline, Crestone,
Border Midwestern and Border Viking;
(v) None of the Partnership or any of its
Subsidiaries is: (A) in violation of its charter, bylaws, agreement of
limited or general partnership or other governing document (except for
the failure to mail the reports identified in Section 8.3(a) and (b) of
the Partnership Agreement), (B) in default in any material respect, and
no event has occurred which, with notice or lapse of time or both,
would constitute such a default, in the due performance or observance
of any term, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which it is a party or by which it is bound or to which
any of its properties or assets is subject, or (C) other than as set
forth in the Prospectus, in
19
violation in any material respect of any law, ordinance, government
rule, regulation or court decree to which it or its properties or
assets may be subject, except for such violations and defaults that
would not, individually or in the aggregate, result in an Material
Adverse Effect; provided, such counsel may qualify the opinion in this
clause (iv) to her knowledge with respect to any Subsidiary other than
the Intermediate Partnership, Northern Border Pipeline, Crestone,
Border Midwestern and Border Viking;
(vi) Since the date as of which information is given
in the Prospectus through the Closing Date, and except as may otherwise
be disclosed in the Prospectus, neither the Partnership nor the
Intermediate Partnership has (A) issued or granted any partner
interests, (B) incurred any material liability or obligation, direct or
contingent, other than liabilities and obligations that were incurred
in the ordinary course of business, (C) entered into any material
transaction not in the ordinary course of business, or (D) distributed
any of the cash or other assets of the Partnership to any partner;
(vii) The Partnership and its Subsidiaries have good
and indefeasible title to all real and personal property necessary to
own and operate their businesses in all material respects as described
in the Prospectus, free and clear of all liens, encumbrances, security
interests, charges, claims and defects except (A) as described in the
Prospectus and (B) such as do not materially interfere with the
ownership, operation or benefits of ownership of such businesses or
materially increase the cost of operation or ownership of such
businesses, provided that, (1) with respect to the Pipeline Properties,
the foregoing shall only constitute a statement that, to her knowledge,
except as described in the Prospectus (y) Northern Border Pipeline,
Crestone, Bear Paw Energy, Midwestern Gas and Viking Gas have
sufficient title to enable them to use such Pipeline Properties in
their businesses as they have been used in the past and are proposed to
be used in the future as described in the Prospectus and (z) any lack
of title has not had and will not (based on facts known at this time)
have a Material Adverse Effect, and (2) with respect to any real
property, buildings and equipment held under lease by Northern Border
Pipeline, Crestone, Bear Paw Energy, Midwestern Gas or Viking Gas, such
real property, buildings and equipment are held by Northern Border
Pipeline, and to her knowledge, by Crestone, Bear Paw Energy,
Midwestern Gas and Viking Gas under valid, subsisting and enforceable
leases with such exceptions as will not (based on facts known at this
time) have a Material Adverse Effect; and
(viii) Each of Northern Border Pipeline, Border
Viking, Crestone, Border Midwestern, Midwestern Gas, Bear Paw
Investments, Bear Paw Energy, and Viking Gas was duly formed (to her
knowledge in the case of the latter four entities) and is validly
existing and in good standing under the laws of its jurisdiction of
formation and has full corporate, partnership or limited liability
company power and authority, as the case may be, to conduct the
activities conducted by it, to own or lease all the assets owned or
leased by it and to conduct its businesses as described in the
Prospectus; to her knowledge each of Northern Border Pipeline,
Crestone, Bear Paw Energy, Midwestern Gas and Viking Gas is duly
licensed or qualified to do business and in good standing as a foreign
entity in all jurisdictions in which the nature of the activities
conducted by it or the character of the assets owned or leased by it
makes such licensing or qualification necessary, except for such
jurisdictions in which the failure so to qualify or register
20
would not have a material adverse effect upon it or subject it or the
Partnership or the Intermediate Partnership to any material liability
or disability; all of the outstanding interests of Northern Border
Pipeline have been duly authorized and validly issued and are fully
paid and non-assessable (except as provided in the partnership
agreement of Northern Border Pipeline); the Intermediate Partnership
owns a 70% general partner interest in Northern Border Pipeline, and
such interest is free and clear of any liens, encumbrances, security
interests, charges or claims (except for such liens, encumbrances,
security interests, charges or claims as are not, individually or in
the aggregate, material or except as described in the Prospectus); all
of the outstanding shares of Crestone have been duly authorized and
validly issued and are fully paid and non-assessable and are owned by
the Intermediate Partnership free and clear of all liens, encumbrances,
security interests, charges or claims (except for such liens,
encumbrances, security interests, charges or claims as are not,
individually or in the aggregate, material or except as described in
the Prospectus); all of the outstanding interests of Bear Paw
Investments have been duly authorized and validly issued and are fully
paid and non-assessable and are owned by the Intermediate Partnership
free and clear of any liens, encumbrances, security interests, charges
or claims (except for such liens, encumbrances, security interests,
charges or claims as are not, individually or in the aggregate,
material or except as described in the Prospectus); all of the
outstanding interests of Bear Paw Energy have been duly authorized and
validly issued and are fully paid and non-assessable and are owned by
Bear Paw Investments free and clear of any liens, encumbrances,
security interests, charges or claims (except for such liens,
encumbrances, security interests, charges or claims as are not,
individually or in the aggregate, material or except as described in
the Prospectus); all of the outstanding shares of capital stock of
Border Midwestern have been duly authorized and validly issued and are
fully paid and non-assessable and are owned by the Intermediate
Partnership free and clear of any liens, encumbrances, security
interests, charges or claims (except for such liens, encumbrances,
security interests, charges or claims as are not, individually or in
the aggregate, material or except as described in the Prospectus); all
of the outstanding shares of capital stock of Midwestern Gas have been
duly authorized and validly issued and are fully paid and
non-assessable and are owned by Border Midwestern free and clear of any
liens, encumbrances, security interests, charges or claims (except for
such liens, encumbrances, security interests, charges or claims as are
not, individually or in the aggregate, material or except as described
in the Prospectus); all of the outstanding shares of Border Viking have
been duly authorized and validly issued and are fully paid and
non-assessable and are owned by the Intermediate Partnership free and
clear of all liens, encumbrances, security interests, charges or claims
(except for such liens, encumbrances, security interests, charges or
claims as are not, individually or in the aggregate, material or except
as described in the Prospectus); all of the outstanding shares of
capital stock of Viking Gas have been duly authorized and validly
issued and are fully paid and non-assessable and are owned by Border
Viking free and clear of any liens, encumbrances, security interests,
charges or claims (except for such liens, encumbrances, security
interests, charges or claims as are not, individually or in the
aggregate, material or except as described in the Prospectus); provided
such counsel may qualify to her knowledge the opinions (A) as to due
authorization, valid issuance, full payment and non-assessability with
respect to Bear Paw Investments, Bear Paw Energy, Midwestern Gas and
Viking
21
Gas and (B) as to liens, encumbrances, security interests, charges or
claims enforceable under the UCC with respect to Bear Paw Investments,
Bear Paw Energy, Midwestern Gas and Viking Gas.
In addition, such counsel shall state that in the course of
preparation by the Partnership of the Registration Statement, the Preliminary
Prospectus and the Prospectus, such counsel participated in conferences with
officers and other representatives of the Partnership and certain of its
subsidiaries, representatives of the independent public accountants of the
Partnership and, in the case of the Preliminary Prospectus and the Prospectus,
your representatives, at which the contents of the Registration Statement, the
Preliminary Prospectus and Prospectus and related matters were discussed. Such
counsel shall also state that although she has not conducted any independent
investigation with regard to the information set forth in the Registration
Statement or the Prospectus (except with respect to the foregoing opinions) and
is not (except as aforesaid) passing upon and does not assume any responsibility
for the accuracy, completeness or fairness of the statements contained therein,
on the basis of the foregoing and during the course of her representation of
Northern Plains, no facts have come to such counsel's attention that cause such
counsel to believe that the Registration Statement or any amendment thereto on
its Effective Date, or as amended or supplemented at the Closing Date, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or that, as of its date or the Closing Date, the Prospectus or any
further amendment or supplement thereto contained an untrue statement of a
material fact or omitted a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. In making such statement, such counsel may
state that she does not express any comment with respect to the financial
statements and related schedules and other financial data included or
incorporated by reference in the Registration Statement or in the Prospectus or
any further amendment or supplement thereto (including, without limitation,
statements relating to projected cash distributions to the limited partners of
the Partnership) or any statement contained therein or omitted therefrom in
reliance upon and in conformity with written information furnished to the
Partnership by any Underwriter through you expressly for use therein.
In rendering such opinion, such counsel may rely (a) as to
matters involving the application of laws of any jurisdiction other than the
State of Nebraska, to the extent she deems proper and specified in such opinion,
upon the opinion of other counsel of good standing whom she believes to be
reliable and who are satisfactory to counsel for the Underwriters and (b) as to
matters of fact, to the extent she deems proper, on certificates of responsible
officers of the Partnership and public officials.
(d) The Representatives shall have received from ▇▇▇▇▇▇ &
▇▇▇▇▇▇ L.L.P., counsel for the Underwriters, such opinion or opinions, dated the
Closing Date and addressed to the Representative, with respect to the issuance
and sale of the Securities, the Registration Statement, the Prospectus (together
with any supplement thereto) and other related matters as the Representatives
may reasonably require, and the Partnership shall have furnished to such counsel
such documents as they reasonably request for the purpose of enabling them to
pass upon such matters.
22
(e) The Partnership shall have furnished to the
Representatives a certificate of the Partnership, signed by the Chief Executive
Officer and the Chief Financial and Accounting Officer of the Partnership, dated
the Closing Date, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus, any supplements
to the Prospectus and this Agreement and that:
(i) the representations and warranties of the
Partnership and the Intermediate Partnership in this Agreement are true
and correct on and as of the Closing Date with the same effect as if
made on the Closing Date and the Partnership has complied with all the
agreements and satisfied all the conditions on its part to be performed
or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Partnership's knowledge,
threatened;
(iii) since the date of the most recent financial
statements included or incorporated by reference in the Prospectus
(exclusive of any supplement thereto), there has been no Material
Adverse Effect, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in
the Prospectus (exclusive of any supplement thereto); and
(iv) to the Partnership's knowledge, the Commission
has not taken any action on the petition for review filed with the
Commission by Enron Corp. on February 27, 2003 and described under
"Risk Factors" in the Prospectus (or describing such action in
reasonable detail if any has been taken).
(f) The Partnership shall have requested and caused KPMG LLP
to have furnished to the Representatives, at the Execution Time and at the
Closing Date, letters, dated respectively as of the Execution Time and as of the
Closing Date, in form and substance satisfactory to the Representatives,
confirming that they are independent accountants within the meaning of the Act
and the Exchange Act and that they have performed a review of the unaudited
interim financial information of the Partnership for the three-month period
ended March 31, 2003 and as of March 31, 2003 in accordance with Statement on
Auditing Standards No. 71, and stating in effect that:
(i) in their opinion the audited financial
statements and financial statement schedules included or incorporated
by reference in the Registration Statement and the Prospectus and
reported on by them comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act;
(ii) on the basis of a reading of the latest
unaudited financial statements made available by the Partnership and
its subsidiaries; their limited review, in accordance with standards
established under Statement on Auditing Standards No. 71, of the
unaudited interim financial information for the three-month period
ended March 31, 2003, and as of March 31, 2003, incorporated by
reference in the Registration Statement and the Prospectus; carrying
out certain specified procedures (but not an examination in
23
accordance with generally accepted auditing standards) which would not
necessarily reveal matters of significance with respect to the comments
set forth in such letter; a reading of the minutes of the meetings of
the Partnership Policy Committee and Audit Committee of the
Partnership; and inquiries of certain officials of the Partnership who
have responsibility for financial and accounting matters of the
Partnership and its subsidiaries as to transactions and events
subsequent to December 31, 2002, nothing came to their attention which
caused them to believe that:
(A) any unaudited financial statements included or
incorporated by reference in the Registration Statement and
the Prospectus do not comply as to form in all material
respects with applicable accounting requirements of the Act
with respect to financial statements included or incorporated
by reference in the Partnership's Quarterly Report on Form
10-Q for the quarter ended March 31, 2003 under the Exchange
Act; and said unaudited financial statements are not in
conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the
audited financial statements included or incorporated by
reference in the Registration Statement and the Prospectus;
(B) with respect to the period subsequent to March
31, 2003, there were any changes, at a specified date not more
than five days prior to the date of the letter, in the
long-term debt including current maturities of the Partnership
or decreases in the partners' capital as compared with the
amounts shown on the March 31, 2003 consolidated balance sheet
included or incorporated by reference in the Registration
Statement and the Prospectus, or for the period from April 1,
2003 to such specified date there were any decreases, as
compared with the corresponding period in the preceding
quarter in operating revenue or net income to partners, except
in all instances for changes or decreases set forth in such
letter, in which case the letter shall be accompanied by an
explanation by the Partnership as to the significance thereof
unless said explanation is not deemed necessary by the
Representatives; and
(C) the information included or incorporated by
reference in the Registration Statement and Prospectus in
response to Regulation S-K, Item 301 (Selected Financial
Data), Item 302 (Supplementary Financial Information), Item
402 (Executive Compensation) and Item 503(d) (Ratio of
Earnings to Fixed Charges) is not in conformity with the
applicable disclosure requirements of Regulation S-K.
(iii) they have performed certain other specified procedures
as a result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Partnership and its subsidiaries) set
forth in the Registration Statement and the Prospectus and in Exhibit
12 to the Registration Statement, including the information set forth
under the captions "Selected Historical Consolidated Financial Data" in
the Prospectus, the information included or incorporated by reference
in Items 1, 6, 7 and 11 of the Partnership's 2002 10-K, incorporated by
reference in the Registration Statement and the Prospectus, and the
information included
24
in the "Management's Discussion and Analysis of Financial Condition and
Results of Operations" included or incorporated by reference in the
Partnership's Quarterly Report on Form 10-Q for the quarter ended March
31, 2003, incorporated by reference in the Registration Statement and
the Prospectus, agrees with the accounting records of the Partnership
and its subsidiaries, excluding any questions of legal interpretation.
References to the Prospectus in this paragraph (f) include any
supplement thereto at the date of the letter.
(g) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto),
there shall not have been (A) any change or decrease specified in the letter or
letters referred to in paragraph (f) of this Section 6 or (B) any change, or any
development involving a prospective change, in or affecting the condition
(financial or otherwise), earnings, business, properties, business prospects or
operations of the Partnership and its subsidiaries, taken as a whole, whether or
not arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement thereto)
the effect of which, in any case referred to in clause (A) or (B) above, is, in
the sole judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto).
(h) Prior to the Closing Date, the Partnership shall have
furnished to the Representatives such further information, certificates and
documents as the Representatives may reasonably request, including evidence of
qualification to do business and good standing of the Partnership and the
Intermediate Partnership in the states in which they are qualified to do
business.
(i) Subsequent to the Execution Time, there shall not have
been any decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act) or any notice given of any intended or potential
decrease in any such rating or of a possible change in any such rating that does
not indicate the direction of the possible change.
(j) The Underwritten Securities issued by the Partnership
shall have been listed and admitted and authorized for trading on the New York
Stock Exchange, and satisfactory evidence of such actions shall have been
provided to the Representatives.
(k) At the Execution Time, the Partnership shall have
furnished to the Representatives a letter substantially in the form of Exhibit A
hereto addressed to the Representatives from Northern Plains, Pan Border,
Sundance Assets, L.P. and each officer of the Partnership and member of the
Partnership Policy Committee who owns Common Units and each of the former owners
of Bear Paw Investments listed on Schedule II hereto.
25
(l) On or prior to the Closing Date, the Partnership shall
have furnished to the Representatives waivers by each of the General Partners of
their pre-emptive rights pursuant to Section 4.3 of the Partnership Agreement.
(m) On or prior to the Closing Date, the Commission shall not
have taken any action on the petition for review filed with the Commission by
Enron Corp. on February 27, 2003 and described under "Risk Factors" in the
preliminary prospectus filed by the Partnership with the Commission on May 19,
2003 that causes the Partnership or any of its subsidiaries to be a subsidiary
or affiliate of a holding company (other than of an exempt holding company as
that term is used in Section 3(a) of PUHCA) or otherwise is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto).
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as provided in this Agreement or waived by the
Representatives in writing, or if any of the opinions and certificates mentioned
above or elsewhere in this Agreement shall not be reasonably satisfactory in
form and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Partnership in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall
be delivered at the office of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P., counsel for the
Underwriters, at The Terrace 7, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, on the Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Partnership to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Underwriters, the Partnership will reimburse the
Underwriters severally through Citigroup Global Markets Inc. on demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Securities.
8. Indemnification and Contribution.
(a) The Partnership agrees to indemnify and hold harmless each
Underwriter, the directors, officers, employees and agents of each Underwriter
and each person who controls any Underwriter within the meaning of either the
Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement as originally filed or in any amendment thereof, or
in any Preliminary Prospectus or the Prospectus, or in any amendment thereof or
26
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
Partnership will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Partnership by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability which the Partnership may otherwise have.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Partnership, each member of the Partnership
Policy Committee, each officer of the Partnership who signed the Registration
Statement, and each person who controls the Partnership within the meaning of
either the Act or the Exchange Act, to the same extent as the foregoing
indemnity to each Underwriter, but only insofar as losses, claims, damages,
liabilities or actions arise out of or are based upon any untrue statement or
omission or alleged untrue statement or omission made in reliance on and in
conformity with reference to written information relating to such Underwriter
furnished to the Partnership by or on behalf of such Underwriter through the
Representatives specifically for inclusion in the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Partnership acknowledges
that the statements set forth in the last paragraph of the cover page regarding
delivery of the Securities and, under the heading "Underwriting," (i) the list
of the underwriters and their respective participation in the sale of the
Securities, (ii) the sentences related to concessions and reallowances and (iii)
the paragraph(s) related to stabilization, syndicate covering transactions and
penalty bids in any Preliminary Prospectus and the Prospectus constitute the
only information furnished in writing by or on behalf of the several
Underwriters for inclusion in any Preliminary Prospectus or the Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees,
27
costs and expenses of such separate counsel if (i) the use of counsel chosen by
the indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential defendants in,
or targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party will
not, without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any pending
or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising or that may arise out of
such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Partnership and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "LOSSES") to which the
Partnership and one or more of the Underwriters may be subject in such
proportion as is appropriate to reflect the relative benefits received by the
Partnership and by the Underwriters from the offering of the Securities;
provided, however, that in no case shall any Underwriter (except as may be
provided in any agreement among underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting discount
or commission applicable to the Securities purchased by such Underwriter
hereunder. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Partnership and the Underwriters shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Partnership and of the
Underwriters in connection with the statements or omissions which resulted in
such Losses as well as any other relevant equitable considerations. Benefits
received by the Partnership shall be deemed to be equal to the total net
proceeds from the offering (before deducting expenses) received by each of them,
and benefits received by the Underwriters shall be deemed to be equal to the
total underwriting discounts and commissions, in each case as set forth on the
cover page of the Prospectus. Relative fault shall be determined by reference
to, among other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information provided by the Partnership, on the one hand, or the
Underwriters, on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Partnership and the Underwriters severally
agree that it would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person who controls an
Underwriter within the meaning of either
28
the Act or the Exchange Act and each director, officer, employee and agent of an
Underwriter shall have the same rights to contribution as such Underwriter, each
person who controls the Partnership within the meaning of either the Act or the
Exchange Act, each officer of the Partnership who signed the Registration
Statement and each member of the Partnership Policy Committee shall have the
same rights to contribution as the Partnership, subject in each case to the
applicable terms and conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule I hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Partnership. In the event of a default by any Underwriter as set forth in
this Section 9, the Closing Date shall be postponed for such period, not
exceeding five Business Days, as the Representatives shall determine in order
that the required changes in the Registration Statement and the Prospectus or in
any other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any, to
the Partnership and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Partnership
prior to delivery of and payment for the Securities, if at any time prior to
such time (a) trading in the Partnership's Common Units shall have been
suspended by the Commission or the New York Stock Exchange or trading in
securities generally on the New York Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on such Exchange, (b) a
banking moratorium shall have been declared either by federal or New York State
authorities, or (c) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national emergency or war, or
other calamity or crisis the effect of which on financial markets is such as to
make it, in the sole judgment of the Representatives, impractical or inadvisable
to proceed with the offering or delivery of the Securities as contemplated by
the Prospectus (exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Partnership or the Intermediate Partnership or their respective officers, and of
the Underwriters set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf of
any Underwriter or the Partnership or the Intermediate Partnership or any of the
officers, directors, employees, agents or controlling persons referred to in
Section 8
29
hereof, and will survive delivery of and payment for the Securities. The
provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Citigroup Global Markets Inc. General Counsel (fax
no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to the General Counsel, Citigroup Global
Markets Inc., at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention:
General Counsel; or, if sent to the Partnership, will be mailed, delivered or
telefaxed to ▇▇▇▇▇ ▇. Place at (▇▇▇) ▇▇▇-▇▇▇▇ and confirmed to her at (402)
398-7886.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
14. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York. hereunder.
15. Submission to Jurisdiction. The Partnership and the Intermediate
Partnership consent to the non-exclusive jurisdiction of the courts of the State
of New York located in the City and County of New York or in the United States
District Court for the Southern District of New York for the adjudication of any
Claim by the Underwriters and to personal service with respect to the
adjudication of such Claim.
16. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
17. Headings. The section headings used herein are for convenience only
and shall not affect the construction hereof.
18. Definitions. The terms which follow, when used in this Agreement,
shall have the meanings indicated.
"ACT" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"BUSINESS DAY" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in New York
City.
"COMMISSION" shall mean the Securities and Exchange
Commission.
"EFFECTIVE DATE" shall mean, with respect to the Registration
Statement, each date and time that the Registration Statement, any
post-effective amendment or amendments thereto and any Rule 462(b)
Registration Statement became or becomes effective.
30
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"EXECUTION TIME" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
the condition (financial or otherwise), the earnings, business,
properties, prospects or operations of the Partnership and its
subsidiaries, taken as a whole.
"PRELIMINARY PROSPECTUS" shall mean any preliminary prospectus
supplement together with any applicable base prospectus referred to in
paragraph 1(a)(i) above and any preliminary prospectus included in the
Registration Statement at the Effective Date that omits Rule 430A
Information.
"PROSPECTUS" shall mean the prospectus supplement together
with any applicable base prospectus relating to the Securities that is
first filed pursuant to Rule 424(b) after the Execution Time or, if no
filing pursuant to Rule 424(b) is required, shall mean the form of
final prospectus relating to the Securities included in or acting
pursuant to Rule 429 under the Act as a combined prospectus in the
Registration Statement at the Effective Date.
"PUHCA" shall mean the Public Utility Holding Company Act of
1935.
"REGISTRATION STATEMENT" shall mean each of the two
registration statements referred to in paragraph 1(a)(i) above,
including exhibits and financial statements, as amended at the
Execution Time (or, if not effective at the Execution Time, in the form
in which it shall become effective) and, in the event any
post-effective amendment thereto or any Rule 462(b) Registration
Statement becomes effective prior to the Closing Date, shall also mean
such registration statement as so amended or such Rule 462(b)
Registration Statement, as the case may be. Such term shall include any
Rule 430A Information deemed to be included therein at the Effective
Date as provided by Rule 430A.
"RULE 424", "RULE 430A" and "RULE 462" refer to such rules
under the Act.
"RULE 430A INFORMATION" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"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.
"SUBSIDIARY" shall mean the Intermediate Partnership, Northern
Border Pipeline, Crestone, Bear Paw Investments, Bear Paw Energy,
Border Midwestern, Midwestern Gas, Border Viking and Viking Gas.
[Signature Pages Follow]
31
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Partnership, the Intermediate Partnership and the several Underwriters.
Very truly yours,
NORTHERN BORDER PARTNERS, L.P.
By: /s/ ▇▇▇▇▇▇▇ ▇.▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Executive Officer
NORTHERN BORDER INTERMEDIATE LIMITED PARTNERSHIP
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Executive Officer
SIGNATURE PAGE TO
UNDERWRITING AGREEMENT
The foregoing Agreement is hereby confirmed and
accepted as of the date first above written.
Citigroup Global Markets Inc.
UBS Warburg LLC
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
BY: CITIGROUP GLOBAL MARKETS INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
For themselves and the other several Underwriters
named in Schedule I to the foregoing Agreement.
SIGNATURE PAGE TO
UNDERWRITING AGREEMENT
SCHEDULE I
NUMBER OF UNDERWRITTEN
UNDERWRITERS SECURITIES TO BE PURCHASED
------------ --------------------------
Citigroup Global Markets Inc................................... 776,250
UBS Warburg LLC............................................... 776,250
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc...................................... 427,500
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc......................................... 270,000
---------
Total 2,250,000
=========
Schedule I-1
SCHEDULE II
1. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
2. ▇▇▇▇▇▇ ▇▇▇▇▇
3. ▇▇▇▇▇ ▇▇▇▇▇
4. Thom. Edelman Irrevocable Trust fbo Eliz. Edelman
5. Thom. Edelman Irrevicable Trust fbo ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
6. Bear Cub Investments, LLC
Schedule II-1
EXHIBIT A
(LETTERHEAD OF OFFICER, DIRECTOR OR
MAJOR STOCKHOLDER OF CORPORATION)
Northern Border Partners, L.P.
Public Offering of Common Units
May __, 2003
Citigroup Global Markets Inc.
UBS Warburg LLC
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
As Representatives of the Several Underwriters,
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "
UNDERWRITING AGREEMENT"), between Northern Border
Partners, L.P., a Delaware limited partnership (the "PARTNERSHIP"), Northern
Border Intermediate Limited Partnership and each of you as representatives of a
group of Underwriters named therein, relating to an underwritten public offering
of Common Units (the "COMMON UNITS"), of the Partnership.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned will not, without the prior written
consent of Citigroup Capital Markets, Inc., offer, sell, contract to sell,
pledge or otherwise dispose of, (or enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash settlement or
otherwise) by the undersigned or any affiliate of the undersigned or any person
in privity with the undersigned or any affiliate of the undersigned), directly
or indirectly, including the filing (or participation in the filing) of a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
Common Units of the Partnership or any securities convertible into, or
exercisable or exchangeable for such Common Units, or publicly announce an
intention to effect any such transaction, for a period of thirty [30] or ninety
[90] days after the date of the
Underwriting Agreement, other than Common Units
disposed of as bona fide gifts approved by Citigroup Global Markets Inc.
Exhibit A-1
If for any reason the
Underwriting Agreement shall be terminated prior
to the Closing Date (as defined in the
Underwriting Agreement), the agreement
set forth above shall likewise be terminated.
Yours very truly,
(SIGNATURE OF OFFICER, DIRECTOR OR MAJOR
STOCKHOLDER)
(NAME AND ADDRESS OF OFFICER, DIRECTOR OR MAJOR
STOCKHOLDER)
Exhibit A-2