EXHIBIT 1.1
EXECUTION VERSION
ENTERPRISE PRODUCTS PARTNERS L.P.
10,400,000 COMMON UNITS
REPRESENTING LIMITED PARTNER INTERESTS
UNDERWRITING AGREEMENT
May 29, 2003
Citigroup Global Markets Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, Sachs & Co.
UBS Warburg LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Wachovia Securities, Inc.
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
As Representatives of the Underwriters
named in Schedule II hereto
Dear Sirs:
Enterprise Products Partners L.P., a Delaware limited
partnership (the "Partnership"), proposes to issue and sell 10,400,000 Common
Units (the "Firm Units") set forth in Schedule I hereto, each representing a
limited partner interest in the Partnership (the "Common Units"), to the several
Underwriters named in Schedule II hereto (the "Underwriters") for whom you are
acting as representatives (the "Representatives"). In addition, the Partnership
proposes to grant to the Underwriters an option to purchase up to an additional
1,560,000 Common Units, on the terms and for the purposes set forth in Section 2
(the "Option Units"). The Firm Units and the Option Units, if purchased, are
hereinafter collectively called the "Units." The Firm Units include 702,500
Common Units to be purchased by the Affiliate Purchasers identified in Section
7(n) (the "Affiliate Units"). Capitalized terms used but not defined herein
shall have the same meanings given them in the Partnership Agreement (as defined
herein).
This is to confirm the agreement among Enterprise Products GP,
LLC, a Delaware limited liability company (the "General Partner"), the
Partnership and Enterprise Products Operating L.P., a Delaware limited
partnership (the "Operating Partnership"), (collectively, the "Enterprise
Parties") and the Underwriters concerning the purchase of the Firm Units and the
Option Units from the Partnership by the Underwriters.
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1. Representations, Warranties and Agreements of the
Enterprise Parties. Each of the Enterprise Parties represents and warrants to,
and agrees with, each Underwriter that:
(a) Definitions. The Partnership and the Operating Partnership
have filed with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 (file numbers 333-102778 and 333-102778-01),
including a prospectus, relating to the Units and the Partnership has filed
with, or transmitted for filing to, or shall promptly hereafter file with or
transmit for filing to, the Commission a prospectus supplement (the "Prospectus
Supplement") specifically relating to the Units pursuant to Rule 424 under the
Securities Act of 1933, as amended (the "Securities Act"). The registration
statement as amended at the date of the Underwriting Agreement, including
information, if any, deemed to be part of the registration statement at the time
of effectiveness pursuant to Rule 430A under the Securities Act, is hereinafter
referred to as the "Registration Statement." The term "Basic Prospectus" means
the prospectus included in the Registration Statement. The term "Prospectus"
means the Basic Prospectus together with the Prospectus Supplement. The term
"Preliminary Prospectus" means a preliminary prospectus supplement specifically
relating to the Units, together with the Basic Prospectus. As used herein, the
terms "Registration Statement," "Basic Prospectus," "Prospectus" and
"Preliminary Prospectus" shall include in each case the documents, if any,
incorporated by reference therein (the "Incorporated Documents"). The terms
"supplement," "amendment" and "amend" as used herein shall include the filing of
all documents deemed to be incorporated by reference in the Prospectus that are
filed subsequent to the date of the Underwriting Agreement by the Partnership
with the Commission pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act"). For purposes of this Agreement, "Effective Time" means the
date and time the Registration Statement became effective.
(b) Effectiveness. The Registration Statement has become
effective under the Securities Act; no stop order suspending the effectiveness
of the Registration Statement is in effect; and no proceedings for such purpose
are pending before or, to the knowledge of the Enterprise Parties, threatened by
the Commission.
(c) No Material Misstatements or Omissions. The Registration
Statement conforms, and any further amendments or supplements to the
Registration Statement will, when they become effective, conform in all material
respects to the requirements of the Securities Act and the rules and regulations
of the Commission thereunder (the "Rules and Regulations") and do not and will
not, as of the applicable effective date, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. The Prospectus and any
supplement or amendment thereto when filed with the Commission under Rule 424(b)
will conform in all material respects to the requirements of the Securities Act
and the Rules and Regulations, and do not or 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. Each forward-looking statement (within the
meaning of Section 27A of the Securities Act and Section 21E of the Exchange
Act) made by the Partnership in such documents, including (but not limited to)
any statements with respect to future available cash or future cash
distributions of the Partnership or the anticipated ratio of taxable income to
distributions, was made or will be made with a reasonable basis and in good
faith. Notwithstanding the foregoing, no representation or warranty is made as
to information
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contained in or omitted from the Registration Statement or the Prospectus in
reliance upon and in conformity with written information furnished to the
Partnership by or on behalf of any Underwriter specifically for inclusion
therein. The Incorporated Documents heretofore filed with the Commission, when
they were filed, conformed in all material respects to the requirements of the
Exchange Act and the rules and regulations of the Commission thereunder and did
not, as of the time each such document was filed, contain an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading. Any further
Incorporated Documents so filed will, when they are filed, conform in all
material respects to the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder and will not, as of the time each such
document is filed, contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading.
(d) Formation and Qualification of the Partnership. Each of
the General Partner, the Partnership, the Operating Partnership and their
respective subsidiaries listed on Schedule III hereto (collectively, the
"Partnership Entities," and the subsidiaries listed on Schedule III hereto, the
"Subsidiaries") has been duly formed and is validly existing in good standing
under the laws of their respective jurisdictions of formation with all
corporate, limited liability company or partnership power and authority
necessary to own or hold their respective properties and conduct the businesses
in which they are engaged and, in the case of the General Partner, to act as
general partner of the Partnership and the Operating Partnership, in each case
in all material respects as described in the Registration Statement and the
Prospectus. Each Partnership Entity is duly qualified to do business and is in
good standing as a foreign corporation, limited liability company or
partnership, as the case may be, in each jurisdiction in which its ownership or
lease of property or the conduct of its businesses requires such qualification,
except where the failure to so qualify would not, individually or in the
aggregate, have a material adverse effect on the condition (financial or
otherwise), results of operations, business or prospects of the Partnership
Entities taken as a whole (a "Material Adverse Effect") or subject the limited
partners of the Partnership to any material liability or disability.
(e) Ownership of General Partner. EPC Partners II, Inc. owns
65% of the issued and outstanding membership interests in the General Partner;
▇▇▇ ▇▇▇▇▇▇ LLC owns 5% of the issued and outstanding membership interests in the
General Partner; and Shell US Gas & Power LLC, a Delaware limited liability
company and an affiliate of Shell Oil Company, owns 30% of the issued and
outstanding membership interests in the General Partner; such membership
interests have been duly authorized and validly issued in accordance with the
limited liability company agreement of the General Partner; and each of EPC
Partners II, Inc. and ▇▇▇ ▇▇▇▇▇▇ LLC owns such membership interests free and
clear of all liens, encumbrances, security interests, equities, charges or
claims, in each case other than liens in favor of Enterprise Products Company's
lenders.
(f) Ownership of General Partner Interest in the Partnership.
The General Partner is the sole general partner of the Partnership with a 1.0%
general partner interest in the Partnership (including the right to receive
Incentive Distributions (as defined in the Partnership Agreement)); such general
partner interest has been duly authorized and validly issued in accordance with
the Amended and Restated Agreement of Limited Partnership of the Partnership, as
amended to date (as the same may be amended and restated at the Closing Date,
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the "Partnership Agreement"); and the General Partner owns such general partner
interest free and clear of all liens, encumbrances, security interests,
equities, charges or claims.
(g) Ownership of Operating Partnership. The General Partner is
the sole general partner of the Operating Partnership with a 1.0101% general
partner interest in the Operating Partnership; such general partner interest has
been duly authorized and validly issued in accordance with the Amended and
Restated Agreement of Limited Partnership of the Partnership, as amended to date
(as the same may be amended and restated at the Closing Date, the "Operating
Partnership Agreement"); and the General Partner owns such general partner
interest free and clear of all liens, encumbrances, security interests,
equities, charges or claims. The Partnership is the sole limited partner of the
Operating Partnership with a 98.9899% limited partner interest in the Operating
Partnership; such limited partner interest has been duly authorized and validly
issued in accordance with the Operating Partnership Agreement and is fully paid
(to the extent required under the Operating Partnership Agreement) and
non-assessable (except as such non-assessability may be affected by Section
17-607 of the Delaware Revised Uniform Limited Partnership Act (the "Delaware LP
Act") and as otherwise described in the Prospectus); and the Partnership owns
such limited partner interest free and clear of all liens, encumbrances,
security interests, equities, charges or claims.
(h) Capitalization. As of the date hereof, the issued and
outstanding limited partner interest of the Partnership consists of 167,062,202
Common Units, 10,000,000 Special Units and 21,409,868 Subordinated Units. All
outstanding Common Units, Special Units and Subordinated Units and the limited
partner interests represented thereby have been duly authorized and validly
issued in accordance with the Partnership Agreement and are fully and (to the
extent required under the Partnership Agreement) and non-assessable (except as
such non-assessability may be affected by Section 17-607 of the Delaware LP Act
and as otherwise disclosed in the Prospectus). Enterprise Products Company and
▇▇▇ ▇. ▇▇▇▇▇▇ collectively beneficially own 92,580,538 Common Units and
21,409,868 Subordinated Units, in each case free and clear of all liens,
encumbrances, security interests, equities, charges or claims, other than liens
in favor of Enterprise Products Company's lenders.
(i) Valid Issuance of Firm Units. At the First Delivery Date
or the Second Delivery Date, as the case may be, the Firm Units or the Option
Units, as the case may be, and the limited partner interests represented thereby
will be duly authorized by the Partnership and, when issued and delivered to the
Underwriters against payment therefor in accordance with the terms hereof, will
be validly issued, fully paid (to the extent required under the Partnership
Agreement) and non-assessable (except as such non-assessability may be affected
by Section 17-607 of the Delaware LP Act and as otherwise disclosed in the
Prospectus).
(j) No Preemptive Rights, Registration Rights or Options.
Except as described in the Prospectus or for rights that have been waived, there
are no preemptive rights or other rights to subscribe for or to purchase, nor
any restriction upon the voting or transfer of, any partnership or membership
interests or capital stock in the Partnership Entities, in each case pursuant to
the organizational documents or any agreement or other instrument to which any
Partnership Entity is a party or by which any of them may be bound. Neither the
filing of the Registration Statement nor the offering or sale of the Units as
contemplated by this Agreement gives rise to any rights for or relating to the
registration of any Units or other securities of the
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Partnership or any of its Subsidiaries, other than as provided in the Prospectus
and the Partnership Agreement or as have been waived. Except for options granted
pursuant to employee benefits plans, qualified unit option plans or other
employee compensation plans, there are no outstanding options or warrants to
purchase any partnership or membership interests or capital stock in any
Partnership Entity. Each of the Enterprise Parties has all requisite right,
power and authority to execute and deliver this Agreement and to perform its
respective obligations hereunder. The Partnership has all requisite power and
authority to issue, sell and deliver the Units in accordance with and upon the
terms and conditions set forth in this Agreement, the Partnership Agreement, the
Registration Statement and Prospectus. All action required to be taken by the
Enterprise Parties or any of their partners or members for the due and proper
authorization, execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby has been duly and validly taken.
(k) Ownership of Subsidiaries. All of the outstanding shares
of capital stock, partnership interests or membership interests, as the case may
be, of each Subsidiary have been duly and validly authorized and issued, and are
fully paid and non-assessable (except as such non-assessability may be affected
by Section 17-607 of the Delaware LP Act, in the case of partnership interests,
or Section 18-607 of the Delaware Limited Liability Company Act (the "Delaware
LLC Act"), in the case of membership interests, and except as otherwise
disclosed in the Prospectus), except that, for each Subsidiary of which the
Operating Partnership and/or the Partnership owns 50% or less of the outstanding
capital stock, partnership interests or membership interests, as the case may
be, such representation and warranty is limited to the ownership interest set
forth on Schedule III hereto. The Partnership and/or the Operating Partnership,
as the case may be, owns the shares of capital stock, partnership interests or
membership interests in each Subsidiary as set forth on Schedule III hereto free
and clear of any lien, charge, encumbrance (other than contractual restrictions
on transfer), security interest, restriction upon voting or any other claim of
any third party. None of the Enterprise Parties has any subsidiaries other than
as set forth on Schedule III hereto that, individually or in the aggregate,
would be deemed to be a "significant subsidiary" as such term is defined in Rule
405 of the Act.
(l) Enforceability of Agreement. This Agreement has been duly
authorized and validly executed and delivered by each of the Enterprise Parties.
(m) Partnership Agreement. The Partnership Agreement has been
duly authorized, executed and delivered by the General Partner and is a valid
and legally binding agreement of the General Partner, enforceable against the
General Partner in accordance with its terms; the Operating Partnership
Agreement has been duly authorized, executed and delivered by the General
Partner and the Partnership and is a valid and legally binding agreement of the
General Partner and the Partnership in accordance with its terms; provided that,
with respect to each such agreement, the enforceability thereof may be limited
by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally and by general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(n) No Conflicts. None of the offering, issuance and sale by
the Partnership of the Units, the execution, delivery and performance of this
Agreement by the Enterprise Parties,
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or the consummation of the transactions contemplated hereby (i) conflicts or
will conflict with or constitutes or will constitute a violation of the
agreement of limited partnership, limited liability company agreement,
certificate or articles of incorporation or bylaws or other organizational
documents of any of the Partnership Entities , (ii) conflicts or will conflict
with or constitutes or will constitute a breach or violation of, or a default
(or an event that, with notice or lapse of time or both, would constitute such a
default) under, any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which any of the Partnership Entities is a
party or by which any of them or any of their respective properties may be
bound, (iii) violates or will violate any statute, law or regulation or any
order, judgment, decree or injunction of any court, arbitrator or governmental
agency or body having jurisdiction over any of the Partnership Entities or any
of their properties or assets, or (iv) results or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of any
of the Partnership Entities, which conflicts, breaches, violations, defaults or
liens, in the case of clauses (ii), (iii) or (iv), would, individually or in the
aggregate, have a Material Adverse Effect.
(o) No Consents. No permit, consent, approval, authorization,
order, registration, filing or qualification ("consent") of or with any court,
governmental agency or body having jurisdiction over the Partnership Entities or
any of their respective properties is required in connection with the offering,
issuance and sale by the Partnership of the Units, the execution, delivery and
performance of this Agreement by the Enterprise Parties or the consummation by
the Enterprise Parties of the transactions contemplated by this Agreement,
except (i) for such consents required under the Securities Act, the Exchange Act
and state securities or Blue Sky laws in connection with the purchase and
distribution of the Units by the Underwriters and (ii) for such consents that
have been, or prior to such Delivery Date will be, obtained.
(p) No Default. None of the Partnership Entities is (i) in
violation of its certificate or agreement of limited partnership, limited
liability company agreement, certificate or articles of incorporation or bylaws
or other organizational documents, (ii) in violation of any law, statute,
ordinance, administrative or governmental rule or regulation applicable to it or
of any order, judgment, decree or injunction of any court or governmental agency
or body having jurisdiction over it or has failed to obtain any license, permit,
certificate, franchise or other governmental authorization or permit necessary
to the ownership of its property or to the conduct of its business, or (iii) in
breach, default (and no event that, with notice or lapse of time or both, would
constitute such a default has occurred or is continuing) or violation in the
performance of any obligation, agreement or condition contained in any bond,
debenture, note or any other evidence of indebtedness or in any agreement,
indenture, lease or other instrument to which it is a party or by which it or
any of its properties may be bound, which breach, default or violation, in the
case of clause (ii) or (iii), would, if continued, have a Material Adverse
Effect, or could materially impair the ability of any of the Partnership
Entities to perform their obligations under this Agreement.
(q) Independent Public Accountants. The accountants, Deloitte
& Touche LLP and Ernst & Young LLP, who have certified or shall certify the
audited financial statements included in the Registration Statement, any
Preliminary Prospectus and the Prospectus (or any amendment or supplement
thereto) are independent certified public accountants with respect to
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the Partnership and the General Partner as required by the Securities Act and
the Rules and Regulations.
(r) Financial Statements. The historical financial statements
(including the related notes and supporting schedules) contained or incorporated
by reference in the Registration Statement and the Prospectus (and any amendment
or supplement thereto) comply in all material respects with the applicable
requirements under the Securities Act and the Exchange Act (except that certain
supporting schedules are omitted) and present fairly in all material respects
the financial position, results of operations and cash flows of the entities
purported to be shown thereby on the basis stated therein at the respective
dates or for the respective periods and have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved, except to the extent disclosed therein. The financial
information contained or incorporated by reference in the Registration Statement
and the Prospectus (and any amendment or supplement thereto) under the caption
"Selected Historical and Pro Forma Financial and Operating Data" are derived
from the accounting records of the Partnership and its Subsidiaries and fairly
present the information purported to be shown thereby. The pro forma financial
information contained or incorporated by reference in the Registration Statement
and the Prospectus has been prepared on a basis consistent with the historical
financial statements contained or incorporated by reference in the Prospectus
(except for the pro forma adjustments specified therein), includes all material
adjustments to the historical financial information required by Rule 11-02 of
Regulation S-X under the Securities Act and the Exchange Act to reflect the
transactions described in the Prospectus, gives effect to assumptions made on a
reasonable basis and fairly presents the transactions described in the
Prospectus. The other historical financial and statistical information and data
included or incorporated by reference in the Prospectus are, in all material
respects, fairly presented.
(s) No Distribution of Other Offering Materials. None of the
Partnership Entities has distributed or, prior to the completion of the
distribution of the Units, will distribute, any prospectus (as defined under the
Securities Act) in connection with the offering and sale of the Units other than
the Registration Statement, any Preliminary Prospectus, the Prospectus or other
materials, if any, permitted by the Securities Act, including Rule 134 of the
Rules and Regulations.
(t) Conformity to Description of Units. The Units, when issued
and delivered against payment therefor as provided herein, will conform in all
material respects to the descriptions thereof contained in the Prospectus.
(u) Certain Transactions. Except as disclosed in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), subsequent to the respective dates as of which such information is
given in the Registration Statement and the Prospectus (or any amendment or
supplement thereto), (i) none of the Partnership Entities has incurred any
liability or obligation, indirect, direct or contingent, or entered into any
transactions, not in the ordinary course of business, that, individually or in
the aggregate, is material to the Partnership Entities, taken as a whole, or
(ii) there has not been any material change in the capitalization or material
increase in the long-term debt of the Partnership Entities or any dividend or
distribution of any kind declared, paid or made by the Partnership on any class
of its partnership interests.
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(v) No Omitted Descriptions. There are no legal or
governmental proceedings pending or, to the knowledge of the Enterprise Parties,
threatened or contemplated, against any of the Partnership Entities, or to which
any of the Partnership Entities is a party, or to which any of their respective
properties or assets is subject, that are required to be described in the
Registration Statement or the Prospectus but are not described as required, and
there are no agreements, contracts, indentures, leases or other instruments that
are required to be described in the Registration Statement or the Prospectus or
to be filed as an exhibit to the Registration Statement that are not described
or filed as required by the Securities Act or the Rules and Regulations.
(w) Title to Properties. Each Partnership Entity has (i) good
and indefeasible title to all its interests in its properties that are material
to the operations of the Partnership Entities, taken as a whole, and (ii) good
and marketable title in fee simple to, or valid rights to lease or otherwise
use, all items of other real and personal property which are material to the
business of the Partnership Entities, in each case free and clear of all liens,
encumbrances, claims and defects and imperfections of title except such as (1)
do not materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property by the
Partnership Entities, (2) could not reasonably be expected to have a Material
Adverse Effect or (3) are described, and subject to the limitations contained,
in the Prospectus.
(x) Right-of-Way. Each of the Partnership Entities has such
consents, easements, rights-of-way or licenses from any person ("rights-of-way")
as are necessary to conduct its business in the manner described in the
Prospectus, subject to such qualifications as may be set forth in the Prospectus
and except for such rights-of-way the failure of which to have obtained would
not have, individually or in the aggregate, a Material Adverse Effect; each of
the Partnership Entities has fulfilled and performed all its material
obligations with respect to such rights-of-way and no event has occurred which
allows, or after notice or lapse of time would allow, revocation or termination
thereof or would result in any impairment of the rights of the holder of any
such rights-of-way, except for such revocations, terminations and impairments
that will not have a Material Adverse Effect, subject in each case to such
qualification as may be set forth in the Prospectus; and, except as described in
the Prospectus, none of such rights-of-way contains any restriction that is
materially burdensome to the Partnership Entities, taken as a whole.
(y) Permits. Each of the Partnership Entities has such
material permits, consents, licenses, franchises, certificates and
authorizations of governmental or regulatory authorities ("permits") as are
necessary to own or lease its properties and to conduct its business in the
manner described in the Prospectus, subject to such qualifications as may be set
forth in the Prospectus and except for such permits that, if not obtained, would
not have, individually or in the aggregate, a Material Adverse Effect; each of
the Partnership Entities has fulfilled and performed all its material
obligations with respect to such permits in the manner described, and subject to
the limitations contained in the Prospectus, and no event has occurred that
would prevent the permits from being renewed or reissued or that allows, or
after notice or lapse of time would allow, revocation or termination thereof or
results or would result in any impairment of the rights of the holder of any
such permit, except for such non-renewals, non-issues, revocations, terminations
and impairments that would not, individually or in the aggregate, have a
Material Adverse Effect. None of the Partnership Entities has received
notification of any
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revocation or modification of any such permit or has any reason to believe that
any such permit will not be renewed in the ordinary course.
(z) Books and Records. Each of the Partnership and the
Operating Partnership (i) makes and keeps books, records and accounts that, in
reasonable detail, accurately and fairly reflect the transactions and
dispositions of assets and (ii) maintains systems of internal accounting
controls sufficient to provide reasonable assurances that (A) transactions are
executed in accordance with management's general or specific authorization; (B)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (C) access to assets is permitted only in
accordance with management's general or specific authorization; and (D) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(aa) Related Party Transactions. No relationship, direct or
indirect, exists between or among the Partnership Entities on the one hand, and
the directors, officers, partners, customers or suppliers of the General Partner
and its affiliates (other than the Partnership Entities) on the other hand,
which is required to be described in the Prospectus which is not so described.
(bb) Environmental Compliance. There has been no storage,
generation, transportation, handling, treatment, disposal or discharge of any
kind of toxic or other wastes or other hazardous substances by any of the
Partnership Entities (or, to the knowledge of the Enterprise Parties, any other
entity (including any predecessor) for whose acts or omissions any of the
Partnership Entities is or could reasonably be expected to be liable) at, upon
or from any of the property now or previously owned or leased by any of the
Partnership Entities or upon any other property, in violation of any statute or
any ordinance, rule, regulation, order, judgment, decree or permit or which
would, under any statute or any ordinance, rule (including rule of common law),
regulation, order, judgment, decree or permit, give rise to any liability,
except for any violation or liability that could not reasonably be expected to
have, individually or in the aggregate with all such violations and liabilities,
a Material Adverse Effect; and there has been no disposal, discharge, emission
or other release of any kind onto such property or into the environment
surrounding such property of any toxic or other wastes or other hazardous
substances with respect to which any of the Enterprise Parties has knowledge,
except for any such disposal, discharge, emission or other release of any kind
which could not reasonably be expected to have, individually or in the aggregate
with all such discharges and other releases, a Material Adverse Effect.
(cc) Insurance. The Partnership Entities maintain insurance
covering their properties, operations, personnel and businesses against such
losses and risks as are reasonably adequate to protect them and their businesses
in a manner consistent with other businesses similarly situated. Except as
disclosed in the Prospectus, none of the Partnership Entities has received
notice from any insurer or agent of such insurer that substantial capital
improvements or other expenditures will have to be made in order to continue
such insurance; all such insurance is outstanding and duly in force on the date
hereof and will be outstanding and duly in force on each Delivery Date.
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(dd) Litigation. There are no legal or governmental
proceedings pending to which any Partnership Entity is a party or of which any
property or assets of any Partnership Entity is the subject that, individually
or in the aggregate, if determined adversely to such Partnership Entity, could
reasonably be expected to have a Material Adverse Effect; and to the knowledge
of the Enterprise Parties, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(ee) No Labor Dispute. Except as disclosed in the Prospectus,
no labor dispute with the employees of the Partnership Entities that are engaged
in the business of the Partnership exists or, to the knowledge of the Enterprise
Parties, is imminent or threatened that is reasonably likely to result in a
Material Adverse Effect.
(ff) Intellectual Property. Each Partnership Entity owns or
possesses adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service ▇▇▇▇
registrations, copyrights, licenses and know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) necessary for the conduct of their respective businesses;
and the conduct of their respective businesses will not conflict in any material
respect with, and no Partnership Entity has received any notice of any claim of
conflict with, any such rights of others.
(gg) Investment Company/Public Utility Holding Company. None
of the Partnership Entities is now, or after sale of the Units to be sold by the
Partnership hereunder and application of the net proceeds from such sale as
described in the Prospectus under the caption "Use of Proceeds" will be, (i) an
"investment company" or a company "controlled by" an "investment company" within
the meaning of the Investment Company Act of 1940, as amended (the "Investment
Company Act"), or (ii) a "holding company" or a "subsidiary company" or
"affiliate" of a "holding company" under the Public Utility Holding Company Act
of 1935, as amended.
(hh) NYSE Listing. The Units have been approved for listing on
the New York Stock Exchange, subject only to official notice of issuance.
(ii) Absence of Certain Actions. No action has been taken and
no statute, rule, regulation or order has been enacted, adopted or issued by any
governmental agency or body which prevents the issuance or sale of the Units in
any jurisdiction; no injunction, restraining order or order of any nature by any
federal or state court of competent jurisdiction has been issued with respect to
any Partnership Entity which would prevent or suspend the issuance or sale of
the Units or the use of the Preliminary Prospectus or the Prospectus in any
jurisdiction; no action, suit or proceeding is pending against or, to the
knowledge of the Enterprise Parties, threatened against or affecting any
Partnership Entity before any court or arbitrator or any governmental agency,
body or official, domestic or foreign, which could reasonably be expected to
interfere with or adversely affect the issuance of the Units or in any manner
draw into question the validity or enforceability of this Agreement or any
action taken or to be taken pursuant hereto; and the Partnership has complied
with any and all requests by any securities authority in any jurisdiction for
additional information to be included in the Preliminary Prospectus and the
Prospectus.
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(jj) Other Sales. The Partnership has not sold or issued any
Common Units during the six-month period preceding the date of the Prospectus
other than Common Units issued pursuant to the Underwriting Agreement dated
January 9, 2003 by and among the General Partner, the Partnership, the Operating
Partnership and the underwriters party thereto, employee benefit plans,
qualified options plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants described in the Prospectus.
(kk) Form S-3. The conditions for the use of Form S-3, as set
forth in the General Instructions thereto, have been satisfied.
2. Purchase of the Units.
(a) Subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth, the Partnership agrees to
sell to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Partnership, at a purchase price of $21.40 per
Unit (other than the Affiliate Units, which shall be purchased at a price of
$22.35 per Affiliate Unit), the amount of the Firm Units set forth opposite such
Underwriter's name in Schedule II 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 1,560,000 Option Units at the same purchase price per Unit as the
Underwriters shall pay for the Firm Units (other than the Affiliate Units, which
shall be purchased at a price of $22.35 per Affiliate Unit). Said option may be
exercised only to cover over-allotments in the sale of the Firm Units 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 facsimile
notice by the representative to the Partnership setting forth the number of
units underlying the Option Units as to which the several Underwriters are
exercising the option and the settlement date. The number of units underlying
the Option Units to be purchased by each Underwriter shall be the same
percentage of the total number of units of the Option Units to be purchased by
the several Underwriters as such Underwriter is purchasing of the Firm Units,
subject to such adjustments as you in your absolute discretion shall make to
eliminate any fractional units.
(c) The Partnership shall not be obligated to deliver any of
the Units to be delivered on any Delivery Date, as the case may be, except upon
payment for all the Units to be purchased on such Delivery Date as provided
herein.
3. Offering of Units by the Underwriters. It is understood
that the several Underwriters propose to offer the Units for sale to the public
as set forth in the Prospectus.
4. Delivery of and Payment for the Units. Delivery of and
payment for the Firm Units (including any Option Units provided for in Section
2(b) hereof that have been exercised on or before the third business day prior
to the Closing Date) shall be made on the date and at the time specified in
Schedule I hereto or at such time on such later date not more than three
business days after the foregoing date as the Representatives shall designate,
which date and time may be postponed by agreement among the Representatives and
the Partnership or
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as provided in Section 9 hereof (such date and time of delivery and payment for
the Firm Units being herein called the "Closing Date"). Delivery of the Firm
Units 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 purchase price thereof to or upon the order of the
Partnership by wire transfer payable in same-day funds to an account specified
by the Partnership. Delivery of the Firm Units shall be made through the
facilities of The Depository Trust Company unless the Representatives shall
otherwise instruct. Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligation of each Underwriter hereunder.
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 Units (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) (the "Option Unit Closing Date", and the Closing
Date, each a "Delivery Date") 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 an account specified
by the Partnership. If settlement for the Option Units occurs after the Closing
Date, the Partnership will deliver to the Representatives on the settlement date
for the Option Units, and the obligation of the Underwriters to purchase the
Option Units 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 7 hereof.
5. Further Agreements of the Enterprise Parties. Each of the
Enterprise Parties covenants and agrees with each Underwriter:
(a) Preparation of Prospectus and Registration Statement. (i)
To prepare the Prospectus in a form approved by the Underwriters and to file
such Prospectus pursuant to Rule 424(b) under the Securities Act not later than
Commission's close of business on the second business day following the
execution and delivery of this Agreement or, if applicable, such earlier time as
may be required by Rule 430A(a)(3) under the Securities Act; (ii) to make no
further amendment or any supplement to the Registration Statement or to the
Prospectus except as permitted herein; (iii) to advise the Underwriters,
promptly after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any supplement to
the Prospectus or any amended Prospectus has been filed and to furnish the
Underwriters with copies thereof; (iv) to advise the Underwriters promptly after
it receives notice thereof of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any Preliminary Prospectus
or the Prospectus, of the suspension of the qualification of the Units for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose or of any request by the Commission for the
amending or supplementing of the Registration Statement or the Prospectus or for
additional information; and (v) in the event of the issuance of any stop order
or of any order preventing or suspending the use of any Preliminary Prospectus
or the Prospectus or suspending any such qualification, to use promptly its best
efforts to obtain its withdrawal.
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(b) Signed Copies of Registration Statements. To furnish
promptly to each of the Underwriters and to counsel for the Underwriters a
signed copy of the Registration Statement as originally filed with the
Commission, and each amendment thereto filed with the Commission, including all
consents and exhibits filed therewith.
(c) Exchange Act Reports. To file promptly all reports and any
definitive proxy or information statements required to be filed by the
Partnership with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act ("Exchange Act Reports") subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Units.
(d) Copies of Documents to Underwriters. To deliver promptly
to the Underwriters such number of the following documents as the Underwriters
shall reasonably request: (i) conformed copies of the Registration Statement as
originally filed with the Commission and each amendment thereto (in each case
excluding exhibits) and (ii) each Preliminary Prospectus, the Prospectus and any
amended or supplemented Prospectus; and, if the delivery of a prospectus is
required at any time after the Effective Time in connection with the offering or
sale of the Units or any other securities relating thereto and if at such time
any events shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it shall be
necessary to amend or supplement the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus in order to comply
with the Securities Act or the Exchange Act or with a request from the
Commission, to notify the Underwriters immediately thereof and to promptly
prepare and, subject to Section 5(e) hereof, file with the Commission an amended
Prospectus or supplement to the Prospectus which will correct such statement or
omission or effect such compliance.
(e) Filing of Amendment or Supplement. To file promptly with
the Commission any amendment to the Registration Statement or the Prospectus or
any supplement to the Prospectus that may, in the judgment of the Partnership or
the Underwriters, be required by the Securities Act or the Exchange Act or
requested by the Commission. Prior to filing with the Commission any amendment
to the Registration Statement or supplement to the Prospectus, any document
incorporated by reference in the Prospectus or any Prospectus pursuant to Rule
424 of the Rules and Regulations, to furnish a copy thereof to the Underwriters
and counsel for the Underwriters and not to file any such document to which the
Underwriters shall reasonably object after having been given reasonable notice
of the proposed filing thereof unless the Partnership is required by law to make
such filing.
(f) Reports to Security Holders. As soon as practicable after
the Closing Date, to make generally available to the Partnership's security
holders an earnings statement of the Partnership and its Subsidiaries (which
need not be audited) complying with Section 11(a) of the Securities Act and the
Rules and Regulations (including, at the option of the Partnership, Rule 158).
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(g) Copies of Reports. For a period of two years following the
Effective Time, to furnish to the Underwriters copies of all materials furnished
by the Partnership to its security holders and all reports and financial
statements furnished by the Partnership to the principal national securities
exchange upon which the Units may be listed pursuant to requirements of or
agreements with such exchange or to the Commission pursuant to the Exchange Act
or any rule or regulation of the Commission thereunder.
(h) Blue Sky Laws. Promptly to take from time to time such
actions as the Underwriters may reasonably request to qualify the Units for
offering and sale under the securities or Blue Sky laws of such jurisdictions as
the Underwriters may designate and to continue such qualifications in effect for
so long as required for the resale of the Units; and to arrange for the
determination of the eligibility for investment of the Units under the laws of
such jurisdictions as the Underwriters may reasonably request; provided that no
Partnership Entity shall be obligated to qualify as a foreign corporation in any
jurisdiction in which it is not so qualified or to file a general consent to
service of process in any jurisdiction.
(i) Lock-up Period; Lock-up Letters. For a period of 90 days
from the date of the Prospectus, not to, directly or indirectly, (i) offer for
sale, sell, pledge or otherwise dispose of (or enter into any transaction or
device that is designed to, or could be expected to, result in the disposition
by any person at any time in the future of) any Common Units or securities
convertible into, or exchangeable for Common Units, or sell or grant options,
rights or warrants with respect to any Common Units or securities convertible
into or exchangeable for Common Units (other than the grant of options pursuant
to option plans existing on the date hereof), or (ii) enter into any swap or
other derivatives transaction that transfers to another, in whole or in part,
any of the economic benefits or risks of ownership of such Common Units, whether
any such transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Units or other securities, in cash or otherwise, in each case
without the prior written consent of the Representatives on behalf of the
Underwriters; provided, however, that the foregoing restrictions do not apply
to: (A) the sale of Common Units by the Partnership to the Underwriters in
connection with the public offering contemplated hereby or (B) Common Units,
phantom units, restricted units and options to be issued by the Partnership to
employees and directors of Enterprise Products Company and its affiliates under
the Enterprise Products 1998 Long-Term Incentive Plan and the Enterprise
Products GP, LLC 1999 Long-Term Incentive Plan. Enterprise Products Company,
Enterprise Products Delaware Holdings L.P., ▇▇▇▇▇▇ Family 2000 Trust, ▇▇▇▇▇▇
Family 1998 Trust, EPOLP 1999 Trust and each executive officer and director of
the General Partner shall furnish to the Underwriters, prior to the Delivery
Date, a letter or letters, substantially in the form of Exhibit C hereto,
pursuant to which each such person shall agree not to, directly or indirectly,
(1) offer for sale, sell, pledge or otherwise dispose of (or enter into any
transaction or device that is designed to, or could be expected to, result in
the disposition by any person at any time in the future of) any Common Units or
securities convertible into or exchangeable for Common Units or (2) enter into
any swap or other derivatives transaction that transfers to another, in whole or
in part, any of the economic benefits or risks of ownership of such Common
Units, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Units or other securities, in cash or
otherwise, in each case for a period of 90 days from the date of the Prospectus,
without the prior written consent of the Representatives on behalf of the
Underwriters.
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(j) Application of Proceeds. To apply the net proceeds from
the sale of the Units as set forth in the Prospectus.
(k) Investment Company. To take such steps as shall be
necessary to ensure that no Partnership Entity shall become an "investment
company" as defined in the Investment Company Act.
6. Expenses. The Partnership agrees to pay (a) the costs
incident to the authorization, issuance, sale and delivery of the Units and any
taxes payable in that connection; (b) the costs incident to the preparation,
printing and filing under the Securities Act of the Registration Statement and
any amendments and exhibits thereto; (c) the costs of printing and distributing
the Registration Statement as originally filed and each amendment thereto and
any post-effective amendments thereof (including, in each case, exhibits), each
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus, all as provided in this Agreement; (d) the costs of producing and
distributing this Agreement, any underwriting and selling group documents and
any other related documents in connection with the offering, purchase, sale and
delivery of the Units; (e) the filing fees incident to securing the review, if
applicable, by the National Association of Securities Dealers, Inc. of the terms
of sale of the Units; (f) any applicable listing or other similar fees; (g) the
fees and expenses of preparing, printing and distributing a Blue Sky Memorandum
(including related fees and expenses of counsel to the Underwriters); (h) the
cost of printing certificates representing the Units; (i) the costs and charges
of any transfer agent or registrar; (j) the costs and expenses of the
Partnership relating to investor presentations on any "road show" undertaken in
connection with the marketing of the offering of the Units, including, without
limitation, expenses associated with the production of road show slides and
graphics, fees and expenses of any consultants engaged in connection with the
road show presentations with the prior approval of the Partnership, travel and
lodging expenses of the representatives and officers of the Partnership and any
such consultants; and (k) all other costs and expenses incident to the
performance of the obligations of the Partnership under this Agreement; provided
that, except as provided in this Section 6 and in Section 11 hereof, the
Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel, any transfer taxes on the Units which they may sell
and the expenses of advertising any offering of the Units made by the
Underwriters.
7. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on each Delivery Date, of the representations and warranties of the
Enterprise Parties contained herein, to the accuracy of the statements of the
Enterprise Parties and the officers of the General Partner made in any
certificates delivered pursuant hereto, to the performance by each of the
Enterprise Parties of its obligations hereunder and to each of the following
additional terms and conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 5(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus or
otherwise shall have been complied with to the reasonable satisfaction of the
Underwriters.
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(b) None of the Underwriters shall have discovered and
disclosed to the Partnership on or prior to such Delivery Date that the
Prospectus or any amendment or supplement thereto contains an untrue statement
of a fact which, in the opinion of counsel for the Underwriters, is material or
omits to state any fact which, in the opinion of such counsel, is material and
is required to be stated therein or is necessary to make the statements therein
not misleading.
(c) All corporate, partnership and limited liability company
proceedings and other legal matters incident to the authorization, form and
validity of this Agreement, the Registration Statement and the Prospectus, and
all other legal matters relating to this Agreement and the transactions
contemplated hereby shall be reasonably satisfactory in all material respects to
counsel for the Underwriters, and the Partnership shall have furnished to such
counsel all documents and information that they or their counsel may reasonably
request to enable them to pass upon such matters.
(d) ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P. shall have furnished to the
Underwriters their written opinion, as counsel for the General Partner,
addressed to the Underwriters and dated such Delivery Date, in form and
substance satisfactory to the Underwriters, substantially to the effect set
forth in Exhibit A to this Agreement.
(e) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., shall have furnished to the
Underwriters his written opinion, as Chief Legal Officer of the Partnership,
addressed to the Underwriters and dated such Delivery Date, in form and
substance reasonably satisfactory to the Underwriters, substantially to the
effect set forth in Exhibit B hereto.
(f) The Underwriters shall have received from ▇▇▇▇▇ ▇▇▇▇▇
L.L.P., counsel for the Underwriters, such opinion or opinions, dated such
Delivery Date, with respect to such matters as the Underwriters may reasonably
require, and the Partnership shall have furnished to such counsel such documents
and information as they may reasonably request for the purpose of enabling them
to pass upon such matters.
(g) At the time of execution of this Agreement, the
Underwriters shall have received from each of Deloitte & Touche LLP and Ernst &
Young LLP a letter or letters, in form and substance satisfactory to the
Underwriters, addressed to the Underwriters and dated the date hereof (i)
confirming that they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, and (ii) stating, as of the date hereof (or, with respect to
matters involving changes or developments since the respective dates as of which
specified financial information is given in the Prospectus, as of a date not
more than five days prior to the date hereof), the conclusions and findings of
such firm with respect to the financial information and other matters ordinarily
covered by accountants' "comfort letters" to underwriters in connection with
registered public offerings.
(h) With respect to the letter of Deloitte & Touche LLP
referred to in the preceding paragraph and delivered to the Underwriters
concurrently with the execution of this Agreement (the "initial letter"), the
Partnership shall have furnished to the Underwriters a letter (the "bring-down
letter") of Deloitte & Touche LLP, addressed to the Underwriters and dated
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such Delivery Date (i) confirming that they are independent public accountants
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the
bring-down letter (or, with respect to matters involving changes or developments
since the respective dates as of which specified financial information is given
in the Prospectus, as of a date not more than five days prior to the date of the
bring-down letter), the conclusions and findings of such firm with respect to
the financial information and other matters covered by the initial letters and
(iii) confirming in all material respects the conclusions and findings set forth
in its initial letter.
(i) The Partnership shall have furnished to the Underwriters a
certificate, dated such Delivery Date, of the chief executive officer and the
chief financial officer of its general partner stating that (A) such officers
have carefully examined the Registration Statement and the Prospectus, (B) in
their opinion, the Registration Statement, including the documents incorporated
therein by reference, as of the Effective Time, did not include any untrue
statement of a material fact and did not omit to state a material fact required
to be stated therein or necessary in order to make the statements therein not
misleading, and the Prospectus, including the Incorporated Documents, as of the
date of the Prospectus and as of such Delivery Date, did not and does not
include any untrue statement of a material fact and did not and does not omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, and (C)
as of such Delivery Date, the representations and warranties of the Enterprise
Parties in this Agreement are true and correct, the Enterprise Parties have
complied with all their agreements contained herein and satisfied all conditions
on their part to be performed or satisfied hereunder on or prior to such
Delivery Date, 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 best of such officer's knowledge, are contemplated by the
Commission, and since the date of the most recent financial statements included
or incorporated by reference in the Prospectus, there has been no material
adverse effect on the condition (financial or otherwise), results of operations,
business or prospects of the Partnership Entities 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.
(j) If any event shall have occurred on or prior to such
Delivery Date that requires the Partnership under Section 5(e) to prepare an
amendment or supplement to the Prospectus, such amendment or supplement shall
have been prepared, the Underwriters shall have been given a reasonable
opportunity to comment thereon as provided in Section 5(e) hereof, and copies
thereof shall have been delivered to the Underwriters reasonably in advance of
such Delivery Date.
(k) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency or body which would, as of such Delivery Date, prevent the
issuance or sale of the Units; and no injunction, restraining order or order of
any other nature by any federal or state court of competent jurisdiction shall
have been issued as of such Delivery Date which would prevent the issuance or
sale of the Units.
(l) Subsequent to the execution and delivery of this Agreement
or, if earlier, the dates as of which information is given in the Registration
Statement (exclusive of any
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amendment thereof) and the Prospectus, there shall not have been (i) any change
or decrease specified in the letter or letters referred to in paragraph (g) of
this Section 6 or (ii) any change, or any development involving a prospective
change, in each case which could reasonably be expected to result in a Material
Adverse Effect, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Registration
Statement (exclusive of any amendment thereof) or Prospectus (exclusive of any
supplement thereto) the effect of which 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 Units as
contemplated by the Registration Statement (exclusive of any amendment thereof)
and the Prospectus (exclusive of any supplement thereto).
(m) The New York Stock Exchange shall have approved the Units
for listing, subject only to official notice of issuance.
(n) The Underwriters shall have received from each of the
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 2003 Family Trust, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ 2003 Family Trust,
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ 2003 Family Trust, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 2003 Family Trust, O.S.
Andras, ▇.▇. ▇▇▇▇▇▇, ▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (each, an "Affiliate
Purchaser") a letter agreement in the form of Exhibit D hereto; provided,
however, that notwithstanding anything to the contrary in this Agreement, for
each Affiliate Purchaser that does not purchase its allocated number of
Affiliate Units, the number of Firm Units that the Underwriters shall be
obligated to purchase from the Partnership shall be reduced by such shortfall
amount and all references to the Firm Units in this Agreement shall refer to
such lesser number of Common Units.
All such opinions, certificates, letters and documents
mentioned above or elsewhere in this Agreement shall be deemed to be in
compliance with the provisions hereof only if they are in form and substance
reasonably satisfactory to the Underwriters and to counsel for the Underwriters.
8. Indemnification and Contribution.
(a) Each of the Enterprise Parties, jointly and severally,
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 Securities 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 Securities 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: (i) the
Registration Statement for the registration of the Units or in any amendment
thereof, 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; (ii) the Preliminary Prospectus, the
Prospectus or in any amendment thereof or supplement thereto, or arise out of or
are based upon the omission or the alleged omission to state therein a material
fact necessary in order to make the statements, in the light in which they were
made, 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,
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damage, liability or action; provided, however, that the Enterprise Parties 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 Enterprise Parties
by or on behalf of any Underwriter through the Representatives specifically for
inclusion therein; provided, further, that with respect to any untrue statement
or omission or alleged untrue statement or omission made in any Preliminary
Prospectus, the indemnity agreement contained in this Section 8(a) shall not
inure to the benefit of any Underwriter (or director, officer, employee, agent
or controlling person thereof) from whom the person asserting any such loss,
claim, damage or liability purchased the Units concerned, to the extent that any
such loss, claim, damage or liability of such Underwriter (or director, officer,
employee, agent or controlling person thereof) occurs under the circumstance
where it shall have been determined by a court of competent jurisdiction by
final and nonappealable judgment that (w) the Partnership had previously
furnished copies of the Prospectus to the Underwriters, (x) delivery of the
Prospectus was required by the Securities Act to be made to such person, (y) the
untrue statement or omission or alleged untrue statement or omission contained
in any Preliminary Prospectus was corrected in the Prospectus and (z) there was
not sent or given to such person, at or prior to the written confirmation of the
sale of such Units to such person, a copy of the Prospectus. This indemnity
agreement will be in addition to any liability which the Enterprise Parties may
otherwise have.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless each Enterprise Party, the directors of the General
Partner, the respective officers of the General Partner who sign the
Registration Statement, and each person who controls the Enterprise Parties
within the meaning of either the Securities Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Partnership to each Underwriter, but
only 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 Enterprise Parties
acknowledge that the statements set forth in the last paragraph of the cover
page regarding delivery of the Units and, under the heading "Underwriting", (i)
the list of Underwriters and their respective participation in the sale of the
Common Units, (ii) the sentences related to concessions and reallowances, (iii)
the paragraphs 10, 11 and 12 under the heading "Underwriting" related to
stabilization, syndicate covering transactions and penalty bids and (iv) the
paragraph related to the delivery of a Prospectus in electronic format 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 any claim or 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 claim or 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
substantive rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than
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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 reasonable fees,
costs 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 reasonably 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, 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 reasonably 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 out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in 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, the "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 on the one hand and by the
Underwriters on the other from the offering of the Units; provided, however,
that in no case shall (i) any Underwriter (except as may be provided in any
agreement among underwriters relating to the offering of the Units) be
responsible for any amount in excess of the amount by which the total price at
which the Units underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Partnership
and the Underwriters severally shall contribute in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Partnership on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such Losses 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 it, 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
-20-
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 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 Securities 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 the Securities 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, and each person who controls
the Partnership within the meaning of either the Securities Act or the Exchange
Act, each officer of the General Partner who shall have signed the Registration
Statement and each director of the General Partner 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 Units 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 Firm Units set
forth opposite their names in Schedule II hereto bears to the aggregate amount
of Firm Units set forth opposite the names of all the remaining Underwriters)
the Units which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Units which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Units set forth in Schedule
II hereto, the remaining Underwriters shall have the right to purchase all, but
shall not be under any obligation to purchase any, of the Units, and if such
nondefaulting Underwriters do not purchase all the Units, this Agreement will
terminate without liability to any nondefaulting Underwriter or any Enterprise
Party. 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 any
Enterprise Party 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 Firm Units, if at
any time prior to such time (i) 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, the settlement of such trading generally shall have been materially
disrupted or limited or minimum prices shall have been established on The New
York Stock Exchange, (ii) a
-21-
banking moratorium shall have been declared either by Federal or New York State
authorities or (iii) 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 Firm Units as contemplated by
the Prospectus (exclusive of any supplement thereto).
11. Reimbursement of Underwriters' Expenses. If the sale of
the Units provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 7 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 any Enterprise Party 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 the Representatives on demand for all reasonable
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 Units. If this Agreement is terminated pursuant to Section 9
hereof by reason of the default of one or more of the Underwriters, the
Partnership shall not be obligated to reimburse any defaulting Underwriter on
account of those expenses.
12. Notices. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail
or telecopy transmission to (i) the Citigroup Global Markets Inc. General
Counsel (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to the General Counsel,
Citigroup Global Markets Inc., at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇▇▇, Attention: General Counsel; and (ii) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated,
at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇.
(b) if to the Enterprise Parties, shall be delivered or sent
by mail or telecopy transmission to Enterprise Products Partners L.P., ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Chief Legal
Officer (telecopier no.: 713-880-6570);
(c) provided, however, that any notice to an Underwriter
pursuant to Section 8(c) shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its acceptance
telex to the Underwriters, which address will be supplied to any other party
hereto by the Underwriters upon request. Any such statements, requests, notices
or agreements shall take effect at the time of receipt thereof. The Enterprise
Parties shall be entitled to act and rely upon any request, consent, notice or
agreement given or made on behalf of the Underwriters by Citigroup Global
Markets Inc. on behalf of the Underwriters.
13. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Underwriters, the
Enterprise Parties and their respective successors. This Agreement and the terms
and provisions hereof are for the sole benefit of only those persons, except as
provided in Section 8 with respect to affiliates, officers, directors,
employees, representatives, agents and controlling persons of the Partnership,
the Operating Partnership and the Underwriters. Nothing in this Agreement is
intended or shall be construed to
-22-
give any person, other than the persons referred to in this Section 13, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
14. Survival. The respective indemnities, representations,
warranties and agreements of the Enterprise Parties and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement or any certificate delivered pursuant hereto, shall
survive the delivery of and payment for the Units and shall remain in full force
and effect, regardless of any termination or cancellation of this Agreement or
any investigation made by or on behalf of any of them or any person controlling
any of them.
15. Definition of the Terms "Business Day" and "Subsidiary".
For purposes of this Agreement, (a) "business day" means 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,
and (b) "affiliate" and "subsidiary" have their respective meanings set forth in
Rule 405 of the Rules and Regulations.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Amendments. No amendment or waiver of any provision of
this Agreement, nor any consent or approval to any departure therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
parties hereto.
19. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
-23-
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 Enterprise Parties and the several Underwriters.
Very truly yours,
ENTERPRISE PRODUCTS GP, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Legal Officer
ENTERPRISE PRODUCTS PARTNERS L.P.
By: Enterprise Products GP, LLC, its
general partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Legal Officer
ENTERPRISE PRODUCTS OPERATING L.P.
By: Enterprise Products GP, LLC, its
general partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Executive Vice President
and Chief Legal Officer
-24-
The foregoing Agreement is hereby confirmed and accepted as of the date
specified in Schedule I hereto.
Citigroup Global Markets Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, Sachs & Co.
UBS Warburg LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Wachovia Securities, Inc.
By: CITIGROUP GLOBAL MARKETS INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Director
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Managing Director
For themselves and the other several Underwriters, if any, named in Schedule II
to the foregoing Agreement.
-25-
SCHEDULE I
Underwriting Agreement dated May 29, 2003
Registration Statement No. 333-102778 and ▇▇▇-▇▇▇▇▇▇-▇▇
Representatives: Citigroup Global Markets Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
Title, Purchase Price and Description of Common Units:
Title: Common Units representing Limited Partnership Interests
Number of Firm Units to be sold by the Partnership: 10,400,000
Price to Public per Unit (include accrued dividends, if any): $22.35
Price to Public -- total: $232,440,000
Underwriting Discount per Unit: $0.95
Underwriting Discount -- total: $9,212,625
Proceeds to Partnership per Unit: $21.40
Proceeds to Partnership -- total: $223,227,375
Other provisions: None
Trade Date: May 30, 2003
Closing Date, Time and Location: June 4, 2003 at 9:00 a.m., CST at ▇▇▇▇▇▇ &
▇▇▇▇▇▇ L.L.P., First City Tower, ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇.
Type of Offering: Non-Delayed
Date referred to in Section 5(i) after which the Partnership may offer or sell
securities issued or guaranteed by the Partnership without the consent of the
Representatives: August 28, 2003
Modification of items to be covered by the letters from Ernst & Young LLP and
Deloitte & Touche LLP and delivered and executed pursuant to Section 7(g): None
SCHEDULE II
ENTERPRISE PRODUCTS PARTNERS L.P.
Number of Firm
Underwriters Units to be Purchased
------------ ---------------------
Citigroup Global Markets Inc. 2,444,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated 2,444,000
UBS Warburg LLC 1,768,000
▇▇▇▇▇▇▇, Sachs & Co. 1,040,000
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc. 1,040,000
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc. 624,000
Wachovia Securities, Inc. 624,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. 416,000
--------------------
TOTAL: 10,400,000
SCHEDULE III
SUBSIDIARIES OF THE PARTNERSHIP AND/OR THE OPERATING PARTNERSHIP
SUBSIDIARY OWNERSHIP INTEREST PERCENTAGE (IN %)
---------- ------------------------------------
Enterprise Products Operating L.P. 98.9899
Sorrento Pipeline Company, LLC 100.00
Enterprise ▇▇▇-▇▇▇ Propylene Pipeline L.P. 100.00
Enterprise ▇▇▇-▇▇▇ NGL Pipeline L.P. 100.00
Sailfish Pipeline Company, LLC 100.00
Starfish Pipeline Company, L.L.C. 50.00
Neptune Pipeline Company, LLC 25.67
Enterprise Gas Processing, LLC 100.00
Enterprise Products Texas Operating L.P. 100.00
E-Cypress, LLC 100.00
E-Oaktree, LLC 98.00
Seminole Pipeline Company 78.40
Mapletree, LLC 98.00
Mid-America Pipeline Company, LLC 98.00
Acadian Gas, LLC 100.00
EXHIBIT A
FORM OF OPINION OF ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.
1. Each of the General Partner, the Partnership and the
Operating Partnership has been duly formed and is validly existing in good
standing as a limited liability company or limited partnership under the laws of
the State of Delaware with all necessary limited liability company or limited
partnership power and authority to own or lease its properties and conduct its
businesses and, in the case of the General Partner, to act as the general
partner of the Partnership and the Operating Partnership, in each case in all
material respects as described in the Registration Statement and the Prospectus.
Each of the General Partner, the Partnership and the Operating Partnership is
duly registered or qualified as a foreign limited liability company or foreign
limited partnership for the transaction of business under the laws of the
jurisdictions set forth under its name on Annex 1 attached hereto.
2. The General Partner is the sole general partner of the
Partnership with a 1.0% general partner interest in the Partnership (including
the right to receive Incentive Distributions, as defined in the Partnership
Agreement); such general partner interest has been duly authorized and validly
issued in accordance with the Partnership Agreement; and the General Partner
owns such general partner interest free and clear of all liens, encumbrances,
security interests, charges or claims (A) in respect of which a financing
statement under the Uniform Commercial Code of the State of Delaware naming the
General Partner as debtor is on file in the office of the Secretary of State of
the State of Delaware or (B) otherwise known to such counsel, without
independent investigation, other than those created by or arising under the
Delaware LP Act.
3. To the knowledge of such counsel: EPC Partners II, Inc.
owns 65% of the issued and outstanding membership interests of the General
Partner; ▇▇▇ ▇▇▇▇▇▇ LLC owns 5% of the issued and outstanding membership
interests of the General Partner; and Shell US Gas & Power LLC, a Delaware
limited liability company and an affiliate of Shell Oil Company, owns 30% of the
issued and outstanding membership interests of the General Partner; such
membership interests have been duly authorized and validly issued in accordance
with the GP LLC Agreement; and each of EPC Partners II, Inc. and ▇▇▇ ▇▇▇▇▇▇ LLC
owns such membership interests free and clear of all liens, encumbrances,
security interests, charges or claims (A) in respect of which a financing
statement under the Uniform Commercial Code of the State of Delaware naming EPC
Partners II, Inc. or ▇▇▇ ▇▇▇▇▇▇ LLC as debtor is on file in the office of the
Secretary of State of the State of Delaware or (B) otherwise known to such
counsel, without independent investigation, other than those created by or
arising under the Delaware LLC Act and those in favor of Enterprise Products
Company's and ▇▇▇ ▇▇▇▇▇▇ LLC's lenders.
4. The General Partner is the sole general partner of the
Operating Partnership with a 1.0101% general partner interest in the Operating
Partnership; such general partner interest has been duly authorized and validly
issued in accordance with the Operating Partnership Agreement; and the General
Partner owns such general partner
A-1
interest free and clear of all liens, encumbrances, security interests, charges
or claims (A) in respect of which a financing statement under the Uniform
Commercial Code of the State of Delaware naming the General Partner as debtor is
on file in the office of the Secretary of State of the State of Delaware or (B)
otherwise known to such counsel, without independent investigation, other than
those created by or arising under the Delaware LP Act. The Partnership is the
sole limited partner of the Operating Partnership with a 98.9899% limited
partner interest in the Operating Partnership; such limited partner interest has
been duly authorized and validly issued in accordance with the Operating
Partnership Agreement and is fully paid (to the extent required under the
Operating Partnership Agreement) and non-assessable (except as such
non-assessability may be affected by Section 17-607 of the Delaware LP Act); and
the Partnership owns such limited partner interest free and clear of all liens,
encumbrances, security interests, charges or claims (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 office of the Secretary of
State of the State of Delaware or (B) otherwise known to such counsel, without
independent investigation, other than those created by or arising under the
Delaware LP Act.
5. The Partnership Agreement has been duly authorized,
executed and delivered by the General Partner and is a valid and legally binding
agreement of the General Partner, enforceable against the General Partner in
accordance with its terms; the Operating Partnership Agreement has been duly
authorized, executed and delivered by the General Partner and the Partnership
and is a valid and legally binding agreement of the General Partner and the
Partnership in accordance with its terms; provided that, with respect to each
such agreement, the enforceability thereof may be limited by (A) bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws
relating to or affecting creditors' rights generally and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and (B) public policy, applicable law relating
to fiduciary duties and indemnification and an implied covenant of good faith
and fair dealing.
6. As of the date hereof, the issued and outstanding limited
partner interest of the Partnership consists of 167,062,202 Common Units,
10,000,000 Special Units and 21,409,868 Subordinated Units. All outstanding
Common Units, Special Units and Subordinated Units and the limited partner
interests represented thereby have been duly authorized and validly issued in
accordance with the Partnership Agreement and are fully paid (to the extent
required under the Partnership Agreement) and non-assessable (except as such
non-assessability may be affected by Section 17-607 of the Delaware LP Act and
as described in the Prospectus). Enterprise Products Company and ▇▇▇ ▇. ▇▇▇▇▇▇
collectively beneficially own 92,580,538 and 21,409,868 Subordinated Units, in
each case free and clear of all liens, encumbrances, security interests, charges
or claims (A) in respect of which a financing statement under the Uniform
Commercial Code of the State of Texas naming Enterprise Products Company as
debtor is on file in the office of the Secretary of State of the State of Texas
or (B) otherwise known to such counsel, without independent investigation, other
than those created by or arising under the Delaware LP Act and those in favor of
Enterprise Products Company's lenders.
A-2
7. The Firm Units and the limited partner interests
represented thereby have been duly authorized by the Partnership Agreement and,
when issued and delivered to the Underwriters against payment therefor in
accordance with the terms of this Agreement, will be validly issued, fully paid
(to the extent required under the Partnership Agreement) and non-assessable
(except as such non-assessability may be affected by Section 17-607 of the
Delaware LP Act and as described in the Prospectus).
8. Except as described in the Prospectus and for rights that
have been waived, there are no preemptive rights or other rights to subscribe
for or to purchase, nor any restriction upon the voting or transfer of, any
partnership or membership interests or capital stock in the Enterprise Parties,
in each case pursuant to the organizational documents of such entity. To such
counsel's knowledge, neither the filing of the Registration Statement nor the
offering or sale of the Firm Units as contemplated by this Agreement gives rise
to any rights for or relating to the registration of any Firm Units or other
securities of the Partnership or any of its subsidiaries, other than as provided
in the Prospectus and the Partnership Agreement or as have been waived. The
Partnership has all requisite power and authority to issue, sell and deliver the
Firm Units in accordance with and upon the terms and conditions set forth in
this Agreement, the Partnership Agreement, the Registration Statement and
Prospectus.
9. This Agreement has been duly authorized and validly
executed and delivered by each of the Enterprise Parties.
10. None of the offering, issuance and sale by the Partnership
of the Firm Units, the execution, delivery and performance of this Agreement by
the Enterprise Parties, or the consummation of the transactions contemplated
hereby (i) conflicts or will conflict with or constitutes or will constitute a
violation of the agreement of limited partnership, limited liability company
agreement or other organizational documents of any of the Enterprise Parties or
(ii) results or will result in any violation of the Delaware LP Act, the
Delaware LLC Act, the Delaware General Corporation Law (the "DGCL"), the laws of
the State of Texas or federal law, which violations, in the case of clause (ii),
would, individually or in the aggregate, have a material adverse effect on the
financial condition, business or results of operations of the Partnership
Entities, taken as a whole or could materially impair the ability of any of the
Enterprise Parties to perform its obligations under this Agreement; provided,
however, that for purposes of this paragraph 10, such counsel need not express
an opinion with respect to Federal or state securities laws or other antifraud
laws.
11. No permit, consent, approval, authorization, order,
registration, filing or qualification ("consent") of or with any federal,
Delaware or Texas court, governmental agency or body having jurisdiction over
the Partnership Entities or any of their respective properties is required in
connection with the offering, issuance and sale by the Partnership of the Units,
the execution, delivery and performance of this Agreement by the Partnership or
the consummation of the transactions contemplated by this Agreement, except for
such consents required under state securities or "Blue Sky" laws, as to which
such counsel need not express an opinion.
A-3
12. The statements in the Registration Statement under the
caption "Description of Our Common Units," insofar as they constitute a
description of agreements or refer to statements of law or legal conclusions,
are accurate and complete in all material respects, and the Units, the Common
Units, the Subordinated Units and the Special Units conform in all material
respects to the descriptions thereof contained in the Registration Statement.
13. The opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P. that is filed as
Exhibit 5.1 to the Registration Statement is confirmed and the Underwriters may
rely upon such opinion as if it were addressed to them.
14. The Registration Statement was declared effective under
the Act on April 21, 2003; to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or threatened by the
Commission; and any required filing of the Prospectus pursuant to Rule 424(b)
has been made in the manner and within the time period required by such Rule.
15. The Registration Statement and the Prospectus (except for
the financial statements and the notes and the schedules thereto and the other
financial and statistical information included in the Registration Statement or
the Prospectus, as to which such counsel need not express any opinion) comply as
to form in all material respects with the requirements of the Act and the rules
and regulations promulgated thereunder.
16. None of the Partnership Entities is (i) an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended, or (ii) a "public utility holding company" or "holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
In addition, such counsel shall state that they have
participated in conferences with officers and other representatives of the
Partnership Entities and the independent public accountants of the Partnership
and your representatives, at which the contents of the Registration Statement
and the Prospectus and related matters were discussed, and although such counsel
has not independently verified, is not passing on, and is not assuming any
responsibility for the accuracy, completeness or fairness of the statements
contained in, the Registration Statement and the Prospectus (except to the
extent specified in the foregoing opinion), no facts have come to such counsel's
attention that lead such counsel to believe that the Registration Statement
(other than (i) the financial statements included or incorporated by reference
therein, including the notes and schedules thereto and the auditors' reports
thereon, and (ii) the other financial and statistical information included or
incorporated by reference therein, as to which such counsel need not comment),
as of its effective date contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus (other than
(i) the financial statements included or incorporated by reference therein,
including the notes and schedules thereto and the auditors' reports thereon, and
(ii) the other financial and
A-4
statistical information included or incorporated by reference therein, as to
which such counsel need not comment), as of its issue date and the Closing Date
contained an untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
In rendering such opinion, such counsel may (A) rely in
respect of matters of fact upon certificates of officers and employees of the
Partnership Entities and upon information obtained from public officials, (B)
assume that all documents submitted to them as originals are authentic, that all
copies submitted to them conform to the originals thereof, and that the
signatures on all documents examined by them are genuine, (C) state that their
opinion is limited to federal laws, the Delaware LP Act, the Delaware LLC Act,
the DGCL and the laws of the States of New York and Texas, (D) with respect to
the opinion expressed in paragraph 1 above as to the due qualification or
registration as a foreign limited partnership or limited liability company, as
the case may be, of the General Partner, the Partnership and the Operating
Partnership, state that such opinions are based upon certificates of foreign
qualification or registration provided by the Secretary of State of the States
listed on Annex 1 (each of which shall be dated as of a date not more than
fourteen days prior to the Closing Date and shall be provided to you) and (E)
state that they express no opinion with respect to (i) any permits to own or
operate any real or personal property or (ii) state or local taxes or tax
statutes to which any of the limited partners of the Partnership or any of the
Partnership Entities may be subject.
A-5
EXHIBIT B
FORM OF OPINION OF ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
1. Each of the Partnership Entities (other than the Enterprise
Parties) has been duly formed and is validly existing and in good standing under
the laws of its respective jurisdiction of formation with all necessary
corporate, limited liability company or limited partnership power and authority
to own or lease its properties and conduct its business, in each case in all
material respects as described in the Registration Statement and the Prospectus.
Each of the Partnership Entities (other than the Enterprise Parties) is duly
registered or qualified as a foreign corporation, foreign limited partnership or
foreign limited liability company for the transaction of business under the laws
of each jurisdiction in which its ownership or lease of property or the conduct
of its businesses requires such qualification, except where the failure to so
qualify would not, individually or in the aggregate, have a Material Adverse
Effect.
2. All of the outstanding shares of capital stock, partnership
interest or membership interest, as the case may be, of each Subsidiary have
been duly and validly authorized and issued, are fully paid and non-assessable,
except that, for each Subsidiary of which the Operating Partnership and/or the
Partnership own 50% or less of the outstanding capital stock, partnership
interest or membership interest, as the case may be, this opinion is limited to
the ownership interest set forth on Schedule III of the Underwriting Agreement.
The Operating Partnership and/or the Partnership, as the case may be, owns the
shares of capital stock, partnership interests or membership interests in each
Subsidiary as set forth on Schedule III hereto free and clear of any lien,
charge, encumbrance (other than contractual restrictions on transfer), security
interest, restriction upon voting or any other claim of any third party.
3. Except as described in the Prospectus and for rights that
have been waived, there are no preemptive rights or other rights to subscribe
for or to purchase, nor any restriction upon the voting or transfer of, any
partnership or membership interests or capital stock (a) in the Subsidiaries
pursuant to the organizational documents of any such entity or (b) in the
Partnership Entities pursuant to any agreement or other instrument known to such
counsel to which any Partnership Entity is a party or by which any of them may
be bound (other than the organizational documents of such entity). To such
counsel's knowledge, neither the filing of the Registration Statement nor the
offering or sale of the Units as contemplated by this Agreement gives rise to
any rights for or relating to the registration of any Units or other securities
of the Partnership or any of its subsidiaries, other than as provided in the
Prospectus and the Partnership Agreement or as have been waived. To such
counsel's knowledge, except for options granted pursuant to employee benefits
plans, qualified unit option plans or other employee compensations plants, there
are no outstanding options or warrants to purchase any partnership or membership
interests or capital stock in any Partnership Entity. The Partnership has all
requisite power and authority to issue, sell and deliver the Units in accordance
with and upon the terms and conditions set forth in this Agreement, the
Partnership Agreement, the Registration Statement and Prospectus.
4. None of the offering, issuance and sale by the Partnership
of the Units, the execution, delivery and performance of this Agreement by the
Enterprise Parties, or the consummation of the transactions contemplated hereby
(i) conflicts or will conflict with or
B-1
constitutes or will constitute a violation of the agreement of limited
partnership, limited liability company agreement, certificate or articles of
incorporation or bylaws or other organizational documents of any of the
Partnership Entities (other than the Enterprise Parties), (ii) conflicts or will
conflict with or constitutes or will constitute a breach or violation of, or a
default (or an event that, with notice or lapse of time or both, would
constitute such a default) under, any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument known to such counsel to which
any of the Partnership Entities is a party or by which any of them or any of
their respective properties may be bound, (iii) will result, to the knowledge of
such counsel, in any violation of any judgment, order, decree, rule or
regulation of any court or arbitrator or governmental agency having jurisdiction
over the Partnership Entities or any of their assets or properties, or (iv)
results or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of any of the Partnership Entities,
which conflicts, breaches, violations, defaults or liens, in the case of clauses
(ii), (iii) or (iv), would, individually or in the aggregate, have a material
adverse effect on the financial condition, business or results of operations of
the Partnership Entities, taken as a whole or could materially impair the
ability of any of the Enterprise Parties to perform its obligations under this
Agreement.
5. To the knowledge of such counsel, (a) there is no legal or
governmental proceeding pending or threatened to which any of the Partnership
Entities is a party or to which any of their respective properties is subject
that is required to be disclosed in the Prospectus and is not so disclosed and
(b) there are no agreements, contracts or other documents to which any of the
Partnership Entities is a party that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
In addition, such counsel shall state that he has participated
in conferences with officers and other representatives of the Partnership
Entities and the independent public accountants of the Partnership and your
representatives, at which the contents of the Registration Statement and the
Prospectus and related matters were discussed, and although such counsel has not
independently verified, is not passing on, and is not assuming any
responsibility for the accuracy, completeness or fairness of the statements
contained in, the Registration Statement and the Prospectus (except to the
extent specified in the foregoing opinion), no facts have come to such counsel's
attention that lead such counsel to believe that the Registration Statement
(other than (i) the financial statements included or incorporated by reference
therein, including the notes and schedules thereto and the auditors' reports
thereon, and (ii) the other financial and statistical information included or
incorporated by reference therein, as to which such counsel need not comment),
as of its effective date contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus (other than
(i) the financial statements included or incorporated by reference therein,
including the notes and schedules thereto and the auditors' reports thereon, and
(ii) the other financial and statistical information included or incorporated by
reference therein, as to which such counsel need not comment), as of its issue
date and the Closing Date contained an untrue statement of a material fact or
omitted to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
B-2
In rendering such opinion, such counsel may (A) rely on
certificates of officers and employees of the Partnership Entities and upon
information obtained from public officials, (B) assume that all documents
submitted to him as originals are authentic, that all copies submitted to him
conform to the originals thereof, and that the signatures on all documents
examined by him are genuine, (C) state that his opinion is limited to federal
laws, the Delaware LP Act, the Delaware LLC Act, the DGCL and the laws of the
State of Texas, (D) state that he expresses no opinion with respect to any
permits to own or operate any real or personal property, (E) state that he
expresses no opinion with respect to the title of any of the Partnership
Entities to any of their respective real or personal property or with respect to
the accuracy or descriptions of real or personal property and (F) state that he
expresses no opinion with respect to state or local taxes or tax statutes to
which any of the limited partners of the Partnership or any of the Partnership
Entities may be subject.
B-3
EXHIBIT C
FORM OF LOCK-UP LETTER AGREEMENT
May 29, 2003
Citigroup Global Markets Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, Sachs & Co.
UBS Warburg LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Wachovia Securities, Inc.
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned understands that you, as underwriters (the "Underwriters"),
propose to enter into an Underwriting Agreement (the "Underwriting Agreement")
with the Enterprise Parties providing for the purchase by you and such other
Underwriters of common units, each representing a limited partner interest (the
"Common Units") in the Partnership, and that the Underwriters propose to reoffer
the Common Units to the public (the "Offering"). Capitalized terms used but not
defined herein have the meanings given to them in the Underwriting Agreement.
In consideration of the execution of the Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of Citigroup
Global Markets Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, on behalf of the
Underwriters, the undersigned will not, directly or indirectly, (1) offer for
sale, sell, pledge or otherwise dispose of (or enter into any transaction or
device that is designed to, or could be expected to, result in the disposition
by any person at any time in the future of) any Common Units (including, without
limitation, Common Units that may be deemed to be beneficially owned by the
undersigned in accordance with the rules and regulations of the Securities and
Exchange Commission and Common Units that may be issued upon exercise of any
option or warrant) or securities convertible into or exchangeable for Common
Units owned by the undersigned on the date of execution of this Lock-up Letter
Agreement or on the date of the completion of the Offering, or (2) enter into
any swap or other derivatives transaction that transfers to another, in whole or
in part, any of the economic benefits or risks of ownership of such Common
Units, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Units or other securities, in cash or
otherwise, for a period of 90 days from the date of the Prospectus.
C-1
In furtherance of the foregoing, the Partnership and its Transfer Agent are
hereby authorized to decline to make any transfer of securities if such transfer
would constitute a violation or breach of this Lock-Up Letter Agreement.
It is understood that, if the Partnership notifies you that it does not intend
to proceed with the Offering, if the Underwriting Agreement does not become
effective, or if the Underwriting Agreement (other than the provisions thereof
that survive termination) shall terminate or be terminated prior to payment for
and delivery of the Common Units, the undersigned will be released from
[his/her] obligations under this Lock-Up Letter Agreement.
The undersigned understands that the Partnership and the Underwriters will
proceed with the Offering in reliance on this Lock-Up Letter Agreement.
Whether or not the Offering actually occurs depends on a number of factors,
including market conditions. Any Offering will only be made pursuant to an
Underwriting Agreement, the terms of which are subject to negotiation between
the Partnership and the Underwriters.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to enter into this Lock-Up Letter Agreement and that, upon
request, the undersigned will execute any additional documents necessary in
connection with the enforcement hereof. Any obligations of the undersigned shall
be binding upon the [heirs and personal representatives] (FOR INDIVIDUALS)
[successors and assigns] (FOR NONNATURAL PERSONS) of the undersigned.
Yours very truly,
C-2
EXHIBIT D
FORM OF LETTER AGREEMENT FOR AFFILIATE PURCHASE
May 29, 2003
Citigroup Global Markets Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
Citigroup Global Markets Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, Sachs & Co.
UBS Warburg LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Wachovia Securities, Inc.
c/o Citigroup Global Markets Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement") among Enterprise Products
GP, LLC, Enterprise Products Partners L.P. (the "Partnership") and Enterprise
Products Operating L.P., relating to an underwritten public offering (the
"Offering") of 10,400,000 common units representing limited partner interests
(the "Common Units"), of the Partnership. Capitalized terms used herein have the
meanings given them in the Underwriting Agreement.
Simultaneously with the closing of the public Offering, the
Underwriters agree, severally, to sell to [_______] and [_______] hereby agrees
to purchase from the Underwriters, at a price of $[__] per Unit (which is the
purchase price per Affiliate Unit paid by the Underwriters to the Partnership in
the public Offering), [________] Common Units (the "Affiliate Units").
In consideration of the execution of the Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of Citigroup
Global Markets Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, on behalf of the
Underwriters, the undersigned will not, directly or indirectly, (1) offer for
sale, sell, pledge or otherwise dispose of (or enter into any transaction or
device that is designed to, or could be expected to, result in the disposition
by any person at any time in the future of) any Affiliate Units (including,
without limitation, Affiliate Units that may be deemed to be beneficially owned
by the undersigned in accordance with the rules and regulations of the
Securities and Exchange Commission and Common Units that may be issued upon
exercise of any option or warrant) or securities convertible into or
exchangeable for Affiliate Units owned by the undersigned on the date of
execution of this letter agreement or on the date of the
D-1
completion of the Offering, or (2) enter into any swap or other derivatives
transaction that transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of such Affiliate Units, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of
Affiliate Units or other securities, in cash or otherwise, for a period of 90
days from the date of the Prospectus.
In furtherance of the foregoing, the Partnership and its Transfer Agent
are hereby authorized to decline to make any transfer of securities if such
transfer would constitute a violation or breach of this letter agreement.
It is understood that, if the Partnership notifies you that it does not
intend to proceed with the Offering, if the Underwriting Agreement does not
become effective, or if the Underwriting Agreement (other than the provisions
thereof that survive termination) shall terminate or be terminated prior to
payment for and delivery of the Affiliate Units, the undersigned will be
released from its obligations under this letter agreement.
The undersigned understands that the Partnership and the Underwriters
will proceed with the Offering in reliance on this letter agreement.
Whether or not the Offering actually occurs depends on a number of
factors, including market conditions. Any Offering will only be made pursuant to
an Underwriting Agreement, the terms of which are subject to negotiation between
the Partnership and the Underwriters.
[______] represents and warrants that it is purchasing the Affiliate
Units for investment purposes only and has no present intention to resell the
Affiliate Units. The undersigned further represents that it is not an
"affiliate" (as defined in Conduct Rule 2720 of the NASD Manual) of an NASD
member (as defined in Article 1 of the Bylaws of the NASD) or an "associated
person" (as defined in Article 1 of the Bylaws of the NASD) of an NASD member.
Yours very truly,
--------------------------------
By:
Name:
Title:
D-2