EXHIBIT 1.1
MARKWEST ENERGY PARTNERS, L.P.
2,100,000 COMMON UNITS
REPRESENTING LIMITED PARTNER INTERESTS
UNDERWRITING AGREEMENT
May 20, 2002
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
MCDONALD INVESTMENTS INC.
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The undersigned, MarkWest Energy Partners, L.P., a Delaware limited
partnership (the "PARTNERSHIP"), MarkWest Energy Operating Company, L.L.C., a
Delaware limited liability company (the "OPERATING COMPANY"), MarkWest Energy
GP, L.L.C., a Delaware limited liability company (the "GENERAL PARTNER"),
MarkWest Hydrocarbon, Inc., a Delaware corporation ("MARKWEST"), MarkWest
Michigan, Inc., a Colorado corporation and a wholly owned subsidiary of MarkWest
("MW MICHIGAN"), West Shore Processing Company, L.L.C., a Michigan limited
liability company ("WEST SHORE LLC"), Basin Pipeline, L.L.C., a Michigan limited
liability company ("BASIN LLC"), and MarkWest Energy Appalachia, L.L.C., a
Delaware limited liability company ("MARKWEST APPALACHIA LLC"), hereby address
you as the "Underwriters" and hereby confirm their agreement with the several
Underwriters named below. The Partnership, the Operating Company, West Shore
LLC, Basin LLC and MarkWest Appalachia LLC are collectively referred to herein
as the "PARTNERSHIP ENTITIES." West Shore LLC, Basin LLC and MarkWest Appalachia
LLC are collectively referred to herein as the "OPERATING SUBS." The
Partnership, the Operating Company, the General Partner, MarkWest, MW Michigan
and the Operating Subs are collectively referred to herein as the "MARKWEST
PARTIES."
It is understood and agreed by all parties that the Partnership was formed
to acquire and own most of the natural gas gathering and processing and natural
gas liquid transportation, fractionation and storage assets of MarkWest. The
partnership agreement of the Partnership was adopted by the General Partner, in
its capacity as the General Partner and MarkWest as the organizational limited
partner of the Partnership (the "ORGANIZATIONAL LIMITED PARTNER"), on January
25, 2002 (as the same has been and may be amended or restated at or prior to the
Closing Date (as hereinafter defined), the "PARTNERSHIP AGREEMENT"). The
Partnership will operate its business through the Operating Company. The
Operating Company will operate its business through itself and the Operating
Subs. The General Partner serves as the general partner of the Partnership.
On or prior to the date hereof, the Operating Company and Bank of America,
N.A., as administrative agent, and the other lenders named therein entered into
a bank credit agreement (the "BANK CREDIT AGREEMENT") providing for a $38.6
million revolving facility (of which $10 million will be available for working
capital purposes and $28.6 million will be available to fund acquisitions and
capital expenditures) and a $21.4 million term facility. In addition, on the
Closing Date, MarkWest will amend its $120 million credit agreement to, among
other things, reduce the commitment to $60 million (the "PARENT CREDIT
AGREEMENT").
The Bank Credit Agreement is guaranteed by the Operating Subs. In addition,
the Partnership has pledged its membership interest in the Operating Company,
the Operating Company has pledged its membership interests in the Operating Subs
and the Partnership has mortgaged its assets and the assets of the Operating
Company and the Operating Subs.
It is further understood and agreed by all parties that as of the date
hereof:
(i) each of the General Partner and MarkWest Appalachia LLC is a
wholly owned direct subsidiary of MarkWest;
(ii) the General Partner is the sole general partner of the
Partnership, and MarkWest is the sole limited partner of the Partnership;
(iii) the Operating Company is a wholly owned direct subsidiary of
the Partnership; and
(iv) West Shore LLC is a wholly owned direct subsidiary of MW
Michigan, and West Shore LLC owns 98% and MW Michigan owns 2% of Basin LLC.
On or prior to the Closing Date, the Partnership, the General Partner, the
Operating Company, MarkWest, the Operating Subs and MW Michigan will enter into
a Contribution, Conveyance, Assignment and Assumption Agreement (the
"CONTRIBUTION AGREEMENT") pursuant to which the following transactions will
occur:
(a) MarkWest will contribute its assets in Appalachia that will be
owned by the Partnership to MarkWest Appalachia LLC as a capital
contribution and in exchange for the assumption of related liabilities,
including trade payables $1.8 million;
(b) MarkWest will contribute its interest in MarkWest Appalachia
LLC to the General Partner as a capital contribution;
(c) the General Partner will contribute its interest in MarkWest
Appalachia LLC to the Partnership in exchange for (1) the continuation of
its 2% general partner interest, (2) the issuance of incentive distribution
rights, as defined in the Partnership Agreement (the "INCENTIVE
DISTRIBUTION RIGHTS"), (3) 1.777 million subordinated units representing
subordinated limited partner interests in the Partnership ("SUBORDINATED
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UNITS"), (4) the right to be reimbursed for $16.1 million in capital
expenditures, and (5) the right to receive $25.8 million;
(d) MW Michigan will contribute its interest in Basin LLC and West
Shore LLC to the Partnership in exchange for (1) 1.223 million Subordinated
Units, (2) the right to be reimbursed for $0.4 million in capital
expenditures, and (3) the assumption by the Partnership of $15.1 million of
debt of MW Michigan;
(e) the public offering of the Firm Units contemplated hereby will
be consummated;
(f) the Partnership will (1) pay transaction expenses (estimated at
$3.2 million excluding the Underwriters' discount) in connection with the
public offering of the Firm Units, (2) retire the $15.1 million of debt
assumed by the Partnership, (3) reimburse the General Partner for $15.6
million of capital expenditures, and (4) contribute $4.3 million to Basin
LLC as a capital contribution, which in turn will retire its debt;
(g) the Partnership will contribute its interests in MarkWest
Appalachia LLC, Basin LLC and West Shore LLC to the Operating Company as a
capital contribution and pays $1.8 million over to MarkWest for its use in
retiring for the benefit of MarkWest Appalachia LLC the trade payables
assumed by it in clause (a) above;
(h) West Shore LLC contributes its interest in Basin LLC to the
Operating Company;
(i) the Operating Company will borrow $26.7 million under the Bank
Credit Agreement and distribute the funds to the Partnership which in turn
will distribute (1) $26.3 million to the General Partner of which $0.5
million is in reimbursement of $0.5 million of capital expenditures, and
(2) $0.4 million to MW Michigan in reimbursement of capital expenditures;
(j) the General Partner will distribute its Subordinated Units and
the cash it received from the prior steps to MarkWest;
(k) MarkWest will sell 24,864 Subordinated Units to certain
officers of the General Partner, as well as officers and key employees of
MarkWest who provide services on behalf of the Partnership (collectively,
the "MANAGEMENT GROUP"), for an aggregate of $407,770;
(l) MarkWest will sell 8.6% of its interest in the General Partner
to the Management Group for an aggregate of $183,497; and
(m) if the option described in Section 3 hereof is exercised, the
net proceeds from such exercise will be used to retire a portion of the
debt incurred in clause (i) above
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such that the amount of proceeds attributable to that debt are in
reimbursement of certain capital expenditures of MarkWest.
The transactions described above in clauses (a)-(m) are referred to herein
collectively as the "TRANSACTIONS." In connection with the Transactions, the
parties to the Transactions have entered or will enter into various bills of
sale, assignments, conveyances, contribution agreements and related documents
(collectively, the "CONVEYANCES"). The Conveyances and the Contribution
Agreement are collectively referred to herein as the "CONTRIBUTION DOCUMENTS."
1. DESCRIPTION OF COMMON UNITS. The Partnership proposes to issue and
sell to the Underwriters 2,100,000 Common Units (the "FIRM UNITS"). Solely for
the purpose of covering over-allotments in the sale of the Firm Units, the
Partnership further proposes to grant to the Underwriters the right to purchase
up to an additional 315,000 Common Units (the "OPTION UNITS"), as provided in
Section 3 of this Agreement. The Firm Units and the Option Units are herein
sometimes referred to as the "UNITS" and are more fully described in the
Prospectus hereinafter defined.
2. PURCHASE, SALE AND DELIVERY OF FIRM UNITS. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Partnership agrees to sell to the
Underwriters, and each such Underwriter agrees, severally and not jointly, (a)
to purchase from the Partnership, at a purchase price of $19.065 per unit, the
number of Firm Units set forth opposite the name of such Underwriter in Schedule
I hereto and (b) to purchase from the Partnership any additional number of
Option Units which such Underwriter may become obligated to purchase pursuant to
Section 3 hereof.
Delivery of the Firm Units will be in book-entry form through the
facilities of The Depository Trust Company, New York, New York ("DTC"). Delivery
of the documents required by Section 6 hereof with respect to the Units shall be
made at or prior to 11:00 a.m. on May 24, 2002 at ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, 2300
First City Tower, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ or at such other place
as may be agreed upon between you and the Partnership (the "PLACE OF CLOSING"),
or at such other time and date not later than five full business days thereafter
as you and the Partnership may agree, such time and date of payment and delivery
being herein called the "CLOSING DATE."
The Partnership will cause its transfer agent to deposit as original issue
the Firm Units pursuant to the Full Fast Delivery Program of the DTC.
It is understood that an Underwriter, individually, may (but shall not be
obligated to) make payment on behalf of the other Underwriters whose funds shall
not have been received prior to the Closing Date for Units to be purchased by
such Underwriter. Any such payment by an Underwriter shall not relieve the other
Underwriters of any of their obligations hereunder.
It is understood that the Underwriters propose to offer the Units to the
public upon the terms and conditions set forth in the Registration Statement
hereinafter defined.
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3. PURCHASE, SALE AND DELIVERY OF THE OPTION UNITS. The Partnership
hereby grants an option to the Underwriters to purchase from the Partnership up
to 315,000 Option Units, on the same terms and conditions as the Firm Units;
provided, however, that such option may be exercised only for the purpose of
covering any over-allotments that may be made by the Underwriters in the sale of
the Firm Units. No Option Units shall be sold or delivered unless the Firm Units
previously have been, or simultaneously are, sold and delivered.
The option is exercisable by you at any time, and from time to time, before
the expiration of 30 days from the date of the Prospectus (or, if such 30th day
shall be a Saturday or Sunday or a holiday, on the next day thereunder when the
American Stock Exchange is open for trading), for the purchase of all or part of
the Option Units covered thereby, by notice given by you to the Partnership in
the manner provided in Section 12 hereof, setting forth the number of Option
Units as to which the Underwriters are exercising the option, and the date of
delivery of said Option Units, which date shall not be more than five business
days after such notice unless otherwise agreed to by the parties. You may
terminate the option at any time, as to any unexercised portion thereof, by
giving written notice to the Partnership to such effect.
You shall make such allocation of the Option Units among the Underwriters
as may be required to eliminate purchases of fractional Units.
Delivery of the Option Units will be in book-entry form through the
facilities of DTC. Delivery of the documents required by Section 6 hereof with
respect to the Units shall be made at the Place of Closing at or prior to 11:00
a.m. on the date designated in the notice given by you as provided above, or at
such other time and date as you and the Partnership may agree (which may be the
same as the Closing Date), such time and date of payment and delivery being
herein called the "OPTION CLOSING DATE." On the Option Closing Date, the
Partnership shall provide the Underwriters such representations, warranties,
agreements, opinions, letters, certificates and covenants with respect to the
Option Units as are required to be delivered on the Closing Date with respect to
the Firm Units.
The Partnership will cause its transfer agent to deposit as original issue
the Option Units pursuant to the Full Fast Delivery Program of the DTC.
4. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE MARKWEST PARTIES.
The MarkWest Parties jointly and severally represent and warrant to and agree
with each Underwriter that:
(a) DEFINITIONS. A registration statement (Registration No.
333-81780) on Form S-1 with respect to the Units, including a preliminary
prospectus, and such amendments to such registration statement as may have
been required to the date of this Agreement, has been prepared by the
Partnership pursuant to and in conformity with the requirements of the
Securities Act of 1933, as amended (the "1933 ACT"), and the rules and
regulations thereunder (the "1933 ACT RULES AND REGULATIONS") of the
Securities and Exchange Commission (the "SEC") and has been filed and
declared effective by the SEC under the 1933 Act. Copies of such
registration statement, including any amendments
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thereto, each related preliminary prospectus contained therein, and the
exhibits, financial statements and schedules thereto have heretofore been
delivered by the Partnership to you. A final prospectus containing
information permitted to be omitted at the time of effectiveness by Rule
430A of the 1933 Act Rules and Regulations will be filed promptly by the
Partnership with the SEC in accordance with Rule 424(b) of the 1933 Act
Rules and Regulations. The term "REGISTRATION STATEMENT" as used herein
means the registration statement as amended at the time it became effective
under the 1933 Act (the "EFFECTIVE DATE"), including financial statements
and all exhibits and, if applicable, the information deemed to be included
by Rule 430A of the 1933 Act Rules and Regulations. If it is contemplated,
at the time this Agreement is executed, that a post-effective amendment to
such registration statement will be filed and must be declared effective
before the offering of Units may commence, the term "REGISTRATION
STATEMENT" as used herein means the registration statement as amended by
said post-effective amendment. If an abbreviated registration statement is
prepared and filed with the SEC in accordance with Rule 462(b) or Rule
462(d) under the 1933 Act (an "ABBREVIATED REGISTRATION STATEMENT"), the
term "REGISTRATION STATEMENT" as used in this Agreement includes the
Abbreviated Registration Statement. The term "PROSPECTUS" as used herein
means the prospectus as first filed with the SEC pursuant to Rule 424(b) of
the 1933 Act Rules and Regulations. The term "PRELIMINARY PROSPECTUS" as
used herein shall mean the preliminary prospectus, dated May 8, 2002,
relating to the Units as such preliminary prospectus shall have been
amended from time to time prior to the date of the Prospectus. For purposes
of this Agreement, the words "amend," "amendment," "amended," "supplement"
or "supplemented" with respect to the Registration Statement or the
Prospectus shall mean amendments or supplements to the Registration
Statement or the Prospectus, as the case may be.
(b) NO MATERIAL MISSTATEMENTS OR OMISSIONS. Neither the SEC nor any
state or other jurisdiction or other regulatory body has issued, and
neither is, to the knowledge of the MarkWest Parties, threatening to issue,
any stop order under the 1933 Act or other order suspending the
effectiveness of the Registration Statement (as amended or supplemented) or
preventing or suspending the use of the Preliminary Prospectus or the
Prospectus or suspending the qualification or registration of the Units for
offering or sale in any jurisdiction nor instituted or, to the knowledge of
the MarkWest Parties, threatened to institute proceedings for any such
purpose. The Registration Statement, in the form in which it became
effective and also in such form as it may be when any post-effective
amendment thereto becomes effective, and the Prospectus comply or will
comply, as the case may be, in all material respects with the requirements
of the 1933 Act and the 1933 Act Rules and Regulations. Neither the
Registration Statement nor any amendment thereto, as of the applicable
effective date, contains or will contain, as the case may be, any untrue
statement of a material fact or omits or will omit to state any material
fact required to be stated therein or necessary to make the statements
therein, not misleading, and neither the Preliminary Prospectus, the
Prospectus nor any supplement thereto contains or will contain, as the case
may be, any untrue statement of a material fact or omits or will omit to
state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided,
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however, that the Partnership makes no representation or warranty as to
information contained in or omitted from the Registration Statement, the
Preliminary Prospectus or the Prospectus, or any such amendment or
supplement, in reliance upon, and in conformity with, written information
furnished to the Partnership relating to the Underwriters by or on behalf
of the Underwriters expressly for use in the preparation thereof (as
provided in Section 13 hereof). Each of the statements made by the
Partnership in such documents within the coverage of Rule 175(b) of the
1933 Act Rules and Regulations, 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.
(c) FORMATION AND DUE QUALIFICATION OF THE PARTNERSHIP. The
Partnership has been duly formed and is validly existing in good standing
as a limited partnership under the Delaware Revised Uniform Limited
Partnership Act ("DELAWARE LP ACT") with full partnership power and
authority to own or lease its properties to be owned or leased at the
Closing Date, to assume the liabilities being assumed by it pursuant to the
Contribution Documents and to conduct its business to be conducted at the
Closing Date in all material respects as described in the Registration
Statement and the Prospectus. The Partnership is, or at the Closing Date
will be, duly registered or qualified as a foreign limited partnership for
the transaction of business under the laws of each jurisdiction in which
the character of the business conducted by it or the nature or location of
the properties owned or leased by it makes such registration or
qualification necessary, except where the failure so to register or qualify
would not (i) have a material adverse effect on the business, prospects,
financial condition or results of operations of the Partnership Entities,
taken as a whole ("MATERIAL ADVERSE EFFECT"), or (ii) subject the limited
partners of the Partnership to any material liability or disability.
(d) FORMATION AND DUE QUALIFICATION OF THE GENERAL PARTNER, THE
OPERATING COMPANY AND THE OPERATING SUBS. Each of the General Partner, the
Operating Company and MarkWest Appalachia LLC has been duly formed and is
validly existing in good standing as a limited liability company under the
Delaware Limited Liability Company Act (the "DELAWARE LLC ACT") and each of
West Shore LLC and Basin LLC has been duly formed and is validly existing
and in good standing as a limited liability company under the Michigan
Limited Liability Company Act ("MICHIGAN LLC ACT"), in each case with full
limited liability company power and authority to own or lease its
properties to be owned or leased at the Closing Date, to assume the
liabilities being assumed by it pursuant to the Contribution Documents and
to conduct its business to be conducted at the Closing Date, in each case
in all material respects as described in the Registration Statement and the
Prospectus. The General Partner has all necessary limited liability company
power and authority to act as general partner of the Partnership. Each of
the General Partner, the Operating Company and the Operating Subs is duly
registered or qualified as a foreign limited liability company for the
transaction of business under the laws of each jurisdiction in which the
character of the business conducted by it or the nature or location of the
properties owned or leased by it makes such registration or
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qualification necessary, except where the failure so to register or qualify
would not (i) have a Material Adverse Effect or (ii) subject the limited
partners of the Partnership to any material liability or disability.
(e) FORMATION AND DUE QUALIFICATION OF MARKWEST. MarkWest has been
duly incorporated and is validly existing in good standing under the
Delaware General Corporation Law ("DGCL") with full corporate power and
authority to own or lease its properties to be owned or leased at the
Closing Date and to conduct its business to be conducted at the Closing
Date, in all material respects as described in the Registration Statement
and the Prospectus. MarkWest is duly registered or qualified as a foreign
corporation for the transaction of business under the laws of each
jurisdiction in which the character of the business conducted by it or the
nature or location of the properties owned or leased by it makes such
registration or qualification necessary, except where the failure so to
register or qualify would not (i) have a Material Adverse Effect or (ii)
subject the limited partners of the Partnership to any material liability
or disability.
(f) FORMATION, DUE QUALIFICATION AND OWNERSHIP OF MW MICHIGAN. MW
Michigan has been duly incorporated and is validly existing in good
standing under the Colorado Business Corporation Act ("CBCA") with full
corporate power and authority to own or lease its properties to be owned or
leased at the Closing Date and to conduct its business to be conducted at
the Closing Date in all material respects. MW Michigan is duly registered
or qualified as a foreign corporation for the transaction of business under
the laws of each jurisdiction in which the character of the business
conducted by it or the nature or location of the properties owned or leased
by it makes such registration or qualification necessary, except where the
failure so to register or qualify would not (i) have a Material Adverse
Effect or (ii) subject the limited partners of the Partnership to any
material liability or disability. All of the outstanding capital stock of
MW Michigan has been duly authorized and validly issued, is fully paid and
nonassessable and is owned by MarkWest free and clear of all liens,
encumbrances, security interests, equities, charges or claims, other than
the liens on such securities which exist under the Parent Credit Agreement;
there are no outstanding options to purchase, or rights or warrants to
subscribe for, or securities or obligations convertible into, or contracts
or commitments to issue or sell, any capital stock or other securities of
MW Michigan.
(g) OWNERSHIP OF THE GENERAL PARTNER INTEREST IN THE PARTNERSHIP.
At the Closing Date and the Option Closing Date, after giving effect to the
Transactions, the General Partner will be the sole general partner of the
Partnership with a 2% general partner interest; such general partner
interest will be duly authorized and validly issued in accordance with the
Partnership Agreement; and the General Partner will own such general
partner interest free and clear of all liens, encumbrances, security
interests, equities, charges or claims.
(h) OWNERSHIP OF THE SUBORDINATED UNITS AND THE INCENTIVE
DISTRIBUTION RIGHTS. At the Closing Date and the Option Closing Date, after
giving effect to the Transactions, (i) MarkWest will own 1,752,136
Subordinated Units, (ii) MW Michigan
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will own 1,223,000 Subordinated Units, (iii) the Management Group will
collectively own 24,864 Subordinated Units as described in the Prospectus
and (iv) the General Partner will own all of the Incentive Distribution
Rights; all of such Subordinated Units and Incentive Distribution Rights
and the limited partner interests represented thereby will be duly
authorized and validly issued in accordance with the Partnership Agreement,
and will be fully paid (to the extent required under the Partnership
Agreement) and nonassessable (except as such nonassessability may be
affected by matters described in the Prospectus under the caption "The
Partnership Agreement--Limited Liability"); and MarkWest, MW Michigan and
the Management Group will own their respective Subordinated Units and the
General Partner will own the Incentive Distribution Rights free and clear
of all liens, encumbrances (except with respect to the Incentive
Distribution Rights, restrictions on transferability as described in the
Prospectus), security interests, equities, charges or claims except for
such pledges as may be entered into by the Management Group.
(i) VALID ISSUANCE OF THE UNITS. At the Closing Date or the Option
Closing 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 Agreement and, when issued and
delivered to the Underwriters against payment therefor in accordance with
the terms hereof, will be validly issued, fully paid (to the extent
required under the Partnership Agreement) and nonassessable (except as such
nonassessability may be affected by matters described in the Prospectus
under the caption "The Partnership Agreement--Limited Liability"); and
other than the Subordinated Units and the Incentive Distribution Rights,
the Units will be the only limited partner interests of the Partnership
issued and outstanding at the Closing Date or the Option Closing Date.
(j) OWNERSHIP OF THE MEMBERSHIP INTERESTS IN THE OPERATING COMPANY.
At the Closing Date and the Option Closing Date, after giving effect to the
Transactions, the Partnership will own 100% of the issued and outstanding
membership interests in the Operating Company; such membership interests
will be duly authorized and validly issued in accordance with the limited
liability company agreement of the Operating Company (as the same may be
amended or restated at or prior to the Closing Date, the "OPERATING COMPANY
LLC AGREEMENT") and will be fully paid (to the extent required under the
Operating Company LLC Agreement) and nonassessable (except as such
nonassessability may be affected by Section 18-607 of the Delaware LLC
Act); and, except as may arise under the Bank Credit Agreement the
Partnership will own its membership interests free and clear of all liens,
encumbrances, security interests, equities, charges or claims, except as
may arise under the Bank Credit Agreement.
(k) OWNERSHIP OF THE OPERATING SUBS. At the Closing Date and the
Option Closing Date, after giving effect to the Transactions, the Operating
Company will own 100% of the issued and outstanding membership interests in
each of the Operating Subs; such membership interests will be duly
authorized and validly issued in accordance with the limited liability
company agreements of the Operating Subs (as the same may be amended or
restated at or prior to the Closing Date, the "OPERATING SUBS LLC
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AGREEMENTS") and will be fully paid (to the extent required under the
Operating Subs LLC Agreements) and nonassessable (except as such
nonassessability may be affected by Section 18-607 of the Delaware LLC
Act); and the Operating Company will own such membership interests free and
clear of all liens, encumbrances, security interests, equities, charges or
claims, except as may arise under the Bank Credit Agreement.
(l) OWNERSHIP OF THE GENERAL PARTNER. At the Closing Date and the
Option Closing Date, after giving effect to the Transactions, MarkWest will
own 91.4% of the issued and outstanding membership interests in the General
Partner and the Management Group will own collectively 8.6% of the issued
and outstanding membership interests in the General Partner as described in
the Prospectus; such membership interests will be duly authorized and
validly issued in accordance with the General Partner's limited liability
company agreement (as the same may be amended or restated at or prior to
the Closing Date, the "GENERAL PARTNER LLC AGREEMENT") and will be fully
paid (to the extent required under the General Partner LLC Agreement) and
nonassessable (except as such nonassessability may be affected by Section
18-607 of the Delaware LLC Act); and MarkWest and the Management Group will
own such membership interests free and clear of all liens, encumbrances,
security interests, equities, charges or claims, except for such pledges as
may be entered into by the Management Group.
(m) NO OTHER SUBSIDIARIES. Other than the Partnership's ownership
of its membership interest in the Operating Company and the Operating
Company's ownership of its membership interest in the Operating Subs,
neither the Partnership nor the Operating Company own, and at the Closing
Date and the Option Closing Date, neither will own, directly or indirectly,
any equity or long-term debt securities of any corporation, partnership,
limited liability company, joint venture, association or other entity.
Other than its ownership of its partnership interests in the Partnership,
the General Partner does not own, and at the Closing Date and the Option
Closing Date will not own, directly or indirectly, any equity or long-term
debt securities of any corporation, partnership, limited liability company,
joint venture, association or other entity.
(n) NO PREEMPTIVE RIGHTS, REGISTRATION RIGHTS OR OPTIONS. Except as
described in the Prospectus, 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 member interests of the Partnership
Entities, in each case pursuant to the partnership agreement or limited
liability company agreement of such entity or any other agreement or
instrument to which any of such entities is a party or by which any one 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 Partnership. Except as described in the Prospectus, there
are no outstanding options or warrants to purchase any partnership or
member interests in any Partnership Entity.
(o) AUTHORITY AND AUTHORIZATION. The Partnership has all requisite
power and authority to issue, sell and deliver (i) the Units, in accordance
with and upon the terms
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and conditions set forth in this Agreement, the Partnership Agreement and
the Registration Statement and the Prospectus and (ii) the Subordinated
Units and Incentive Distribution Rights, in accordance with and upon the
terms and conditions set forth in the Partnership Agreement and the
Contribution Documents. At the Closing Date and the Option Closing Date,
all corporate, partnership and limited liability company action, as the
case may be, required to be taken by the MarkWest Parties or any of their
stockholders, members or partners for the authorization, issuance, sale and
delivery of the Units, the Subordinated Units and Incentive Distribution
Rights, the execution and delivery of the Operative Agreements (as defined
in Section 4(q)) and the consummation of the transactions (including the
Transactions) contemplated by this Agreement and the Operative Agreements,
shall have been validly taken.
(p) ENFORCEABILITY OF THE UNDERWRITING AGREEMENT. This Agreement
has been duly executed and delivered by each of the MarkWest Parties, and
constitutes the valid and legally binding agreement of each of the MarkWest
Parties, enforceable against each of the MarkWest Parties in accordance
with its terms, provided that the enforceability thereof may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally and by
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); provided, further, that
the indemnity and contribution provisions hereunder may be limited by
federal or state securities laws.
(q) ENFORCEABILITY OF OTHER AGREEMENTS. At or before the Closing
Date:
(i) The Partnership Agreement will have been duly
authorized, executed and delivered by the General Partner and the
Organizational Limited Partner and will be a valid and legally binding
agreement of the General Partner and the Organizational Limited Partner,
enforceable against the General Partner and the Organizational Limited
Partner in accordance with its terms;
(ii) The Operating Company LLC Agreement will have been duly
authorized, executed and delivered by the Partnership and will be a valid
and legally binding agreement of the Partnership, enforceable against it in
accordance with its terms;
(iii) The General Partner LLC Agreement will have been duly
authorized, executed and delivered by MarkWest and will be a valid and
legally binding agreement of MarkWest, enforceable against it in accordance
with its terms;
(iv) Each of the Operating Subs LLC Agreements will have been
duly authorized, executed and delivered by the applicable Operating Sub and
will be a valid and legally binding agreement of the applicable Operating
Sub, enforceable against it in accordance with its terms;
(v) Each of the Contribution Documents will have been duly
authorized, executed and delivered by the parties thereto and will be valid
and legally
11
binding agreements of the parties thereto enforceable against such parties
in accordance with their respective terms;
(vi) The Bank Credit Agreement will have been duly
authorized, executed and delivered by the Operating Company and will be a
valid and legally binding agreement of the Operating Company enforceable
against it in accordance with its terms;
(vii) The omnibus agreement (the "OMNIBUS AGREEMENT") will be
duly authorized, executed and delivered by each of the Partnership, the
General Partner, the Operating Company and MarkWest, and will be a valid
and legally binding agreement of each of them, enforceable against each of
them in accordance with its terms;
(viii) Each of the gas processing agreement (the "GAS
PROCESSING AGREEMENT"), the pipeline liquids transportation agreement (the
"PIPELINE LIQUIDS TRANSPORTATION AGREEMENT"), the fractionation, storage
and loading agreement (the "FRACTIONATION, STORAGE AND LOADING AGREEMENT")
and the natural gas liquids purchase agreement (the "NATURAL GAS LIQUIDS
PURCHASE AGREEMENT") to be entered into as of the Closing Date by MarkWest
and MarkWest Appalachia LLC will be duly authorized, executed and delivered
by each of MarkWest and MarkWest Appalachia LLC, and will be a valid and
legally binding agreement of each of them, enforceable against each of them
in accordance with its respective terms;
provided that, with respect to each agreement described in this Section
4(q), 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). The Partnership Agreement, the Operating
Company LLC Agreement, the General Partner LLC Agreement, the Operating
Subs LLC Agreements, the Contribution Documents, the Bank Credit Agreement,
the Omnibus Agreement, the Gas Processing Agreement, the Pipeline Liquids
Transportation Agreement, the Fractionation, Storage and Loading Agreement
and the Natural Gas Liquids Purchase Agreement are herein collectively
referred to as the "OPERATIVE AGREEMENTS." The Gas Processing Agreement,
the Pipeline Liquids Transportation Agreement, the Fractionation, Storage
and Loading Agreement, the Natural Gas Liquids Purchase Agreement and the
Omnibus Agreement are herein collectively referred to as the "COLORADO
OPERATING AGREEMENTS."
(r) NO CONFLICTS. None of the offering, issuance and sale by the
Partnership of the Units, the execution, delivery and performance of this
Agreement or the Operative Agreements by the MarkWest Parties which are
parties hereto or thereto, or the consummation of the transactions
contemplated hereby and thereby (including the Transactions) (i)
conflicted, conflicts or will conflict with or constituted, 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
MarkWest Parties, (ii) conflicted, conflicts or will
12
conflict with or constituted, constitutes or will constitute a breach or
violation of, or a default (or an event which, 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 MarkWest Parties is a party or by which any of them or any
of their respective properties may be bound, (iii) violated, violates or
will violate any statute, law or regulation or any order, judgment, decree
or injunction of any court or governmental agency or body directed to any
of the MarkWest Parties or any of their properties in a proceeding to which
any of them or their property is a party or (iv) resulted, results or will
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of any of the MarkWest Parties, which
conflicts, breaches, violations or defaults, in the case of clauses (ii),
(iii) or (iv), would, individually or in the aggregate, have a Material
Adverse Effect.
(s) 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 MarkWest
Parties or any of their respective properties is required for the offering,
issuance and sale by the Partnership of the Units, the execution, delivery
and performance of this Agreement and the Operative Agreements by the
MarkWest Parties party thereto, or the consummation by the MarkWest Parties
of the transactions contemplated by this Agreement or the Operative
Agreements (including the Transactions), except (i) as described in the
Prospectus, (ii) for such consents required under the 1933 Act, the
Securities Exchange Act of 1934, as amended (the "1934 ACT") and state
securities or "Blue Sky" laws, (iii) for such consents which have been, or
prior to the Closing Date will be, obtained, and (iv) for such consents
which, if not obtained, would not, individually or in the aggregate, have a
Material Adverse Effect.
(t) NO DEFAULT. None of the MarkWest Parties 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 (iii) in breach,
default (or an event which, with notice or lapse of time or both, would
constitute such a default) 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 MarkWest Parties to
perform their obligations under this Agreement or the Operative Agreements.
To the knowledge of the MarkWest Parties, no third party to any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which any of the MarkWest Parties is a party or by which any of them is
bound or to which any of their properties is subject, is in default under
any such agreement, which breach, default or violation would, if continued,
have a Material Adverse Effect.
13
(u) CONFORMITY OF SECURITIES TO DESCRIPTIONS IN THE PROSPECTUS. The
Units, when issued and delivered against payment therefor as provided
herein, and the Subordinated Units and the Incentive Distribution Rights,
when issued and delivered in accordance with the terms of the Partnership
Agreement, will conform in all material respects to the descriptions
thereof contained in the Prospectus.
(v) INDEPENDENT PUBLIC ACCOUNTANTS. The accountants,
PricewaterhouseCoopers LLC, who have certified or shall certify the audited
financial statements included in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), are independent public
accountants with respect to the Partnership and the General Partner as
required by the 1933 Act and the 1933 Act Rules and Regulations.
(w) FINANCIAL STATEMENTS. At March 31, 2002, the Partnership would
have had, on the consolidated pro forma basis indicated in the Prospectus
(and any amendment or supplement thereto), a capitalization as set forth
therein. The historical financial statements (including the related notes
and supporting schedules) included in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) 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 to which they
apply and have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved,
except to the extent disclosed therein. The summary historical and pro
forma information set forth in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) under the caption
"Summary Historical and Pro Forma Financial and Operating Data" and the
selected historical and pro forma information set forth under the caption
"Selected Historical and Pro Forma Financial and Operating Data" is
accurately presented in all material respects and prepared on a basis
consistent with the audited and unaudited historical consolidated financial
statements and pro forma financial statements, as applicable, from which it
has been derived. The pro forma financial statements of the Partnership
included in the Registration Statement and the Prospectus (and any
amendment or supplement thereto) have been prepared in all material
respects in accordance with the applicable accounting requirements of
Article 11 of Regulation S-X of the Commission; the assumptions used in the
preparation of such pro forma financial statements are, in the opinion of
the management of the General Partner, reasonable; and the pro forma
adjustments reflected in such pro forma financial statements have been
properly applied to the historical amounts in compilation of such pro forma
financial statements.
(x) NO MATERIAL ADVERSE CHANGE. None of the MarkWest Parties has
sustained since the date of the latest audited financial statements
included in the Registration Statement and the Prospectus any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, investigation, order
14
or decree, otherwise than as set forth or contemplated in the Registration
Statement and the Prospectus. 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 MarkWest Parties has incurred any
liability or obligation, indirect, direct or contingent, or entered into
any transactions, not in the ordinary course of business, that, singly or
in the aggregate, is material to the Partnership Entities, (ii) there has
not been any material change in the capitalization, or material increase in
the short-term debt or long-term debt, of the MarkWest Parties and (iii)
there has not been any material adverse change, or any development
involving or which may reasonably be expected to involve, singly or in the
aggregate, a prospective material adverse change in or affecting the
general affairs, business, prospects, properties, management, condition
(financial or other), partners' capital, stockholders' equity, net worth or
results of operations of the Partnership Entities.
(y) LEGAL PROCEEDINGS OR CONTRACTS TO BE DESCRIBED OR FILED. There
are no legal or governmental proceedings pending or, to the knowledge of
the MarkWest Parties, threatened, against any of the MarkWest Parties, or
to which any of the MarkWest Parties is a party, or to which any of their
respective properties 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 exhibits to the Registration Statement
that are not described or filed as required by the 1933 Act.
(z) TITLE TO PROPERTIES. Upon consummation of the Transactions on
the Closing Date, the Operating Company and the Operating Subs will have
good and indefeasible title to all real property and good title to all
personal property described in the Prospectus to be owned by the Operating
Company and the Operating Subs, free and clear of (i) liens and security
interests, except liens or security interests securing indebtedness
incurred, assumed or agreed to by the Partnership, the Operating Company or
any of the Operating Subs and specifically listed in any of the Conveyances
or (ii) other claims and encumbrances (other than liens or security
interests), except such as are described, and subject to the limitations
contained, in the Registration Statement or Prospectus and do not
materially interfere with the use of such properties taken as a whole as
they have been used in the past and are proposed to be used in the future
as described in the Registration Statement and Prospectus.
(aa) RIGHTS-OF-WAY. Upon consummation of the Transactions on the
Closing Date, each of the Partnership Entities will have, such consents,
easements, rights-of-way, permits or licenses from each person
(collectively, "rights-of-way") as are necessary to conduct its business in
the manner described, and subject to the limitations contained, in the
Prospectus, except for (i) qualifications, reservations and encumbrances
that would not have a Material Adverse Effect and (ii) such rights-of-way
that, if not obtained, would not have, individually or in the aggregate, a
Material Adverse Effect; other than as set
15
forth, and subject to the limitations contained, in the Prospectus, each of
the Partnership Entities has, or upon consummation of the Transactions at
the Closing Date will have, fulfilled and performed all its material
obligations with respect to such rights-of-way and no event has occurred
that 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 would not have a Material Adverse Effect; 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.
(bb) SUFFICIENCY OF CONTRIBUTION DOCUMENTS. The Contribution
Documents will be legally sufficient to transfer or convey to the Operating
Company and the Operating Subs all properties not already held by them that
are, individually or in the aggregate, required to enable the Operating
Company and the Operating Subs to conduct their operations (in all material
respects as contemplated by the Registration Statement and the Prospectus),
subject to the conditions, reservations and limitations contained in the
Contribution Documents and those set forth in the Registration Statement
and the Prospectus. The Operating Company and the Operating Subs, upon
execution and delivery of the Contribution Documents, succeeded or will
succeed in all material respects to the business, assets, properties,
liabilities and operations reflected by the pro forma financial statements
of the Partnership, except as disclosed in the Prospectus and the
Contribution Documents.
(cc) PERMITS. Each of the Partnership Entities has, or at the
Closing Date will have, such permits, consents, licenses, franchises,
certificates and authorizations of governmental or regulatory authorities
("permits") as are necessary to own its properties and to conduct its
business in the manner described in the Prospectus, subject to such
qualifications as may be set forth in the Registration Statement and the
Prospectus and except for such permits that, if not obtained, would not,
individually or in the aggregate, have a Material Adverse Effect; each of
the Partnership Entities has, or at the Closing Date will have, fulfilled
and performed all its material obligations with respect to such permits
which are due to have been fulfilled and performed by such date and no
event has occurred which allows, or after notice or lapse of time would
allow, revocation or termination thereof or results in any impairment of
the rights of the holder of any such permit, except for such revocations,
terminations and impairments that would not, individually or in the
aggregate, have a Material Adverse Effect; and, except as described in the
Registration Statement and the Prospectus, none of such permits contains
any restriction that is materially burdensome to the Partnership Entities
taken as a whole.
(dd) BOOKS AND RECORDS. The Partnership (i) makes and keeps books,
records and accounts, which, 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
16
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.
(ee) TAX RETURNS. Each of the MarkWest Parties has filed (or has
obtained extensions with respect to) all material federal, state and
foreign income and franchise tax returns required to be filed through the
date hereof, which returns are complete and correct in all material
respects, and has timely paid all taxes shown to be due pursuant to such
returns, other than those (i) which are being contested in good faith and
for which adequate reserves have been established in accordance with
generally accepted accounting principles or (ii) which, if not paid, would
not have a Material Adverse Effect.
(ff) INVESTMENT COMPANY/PUBLIC UTILITY HOLDING COMPANY. None of the
MarkWest Parties is now, and 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," none of
the MarkWest Parties will be, (i) an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, or (ii) a
"public utility company," "holding company" or a "subsidiary company" of a
"holding company", under the Public Utility Holding Company Act of 1935, as
amended.
(gg) NO ENVIRONMENTAL PROBLEMS. Except as described in the
Prospectus, the MarkWest Parties (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating
to the protection of human health and safety and the environment or
imposing liability or standards of conduct concerning any Hazardous
Material (as hereinafter defined) ("ENVIRONMENTAL LAWS"), (ii) have
received all permits required of them under applicable Environmental Laws
to conduct their respective businesses, (iii) are in compliance with all
terms and conditions of any such permit and (iv) do not have any liability
in connection with the release into the environment of any Hazardous
Materials, except where such noncompliance with Environmental Laws, failure
to receive required permits, or failure to comply with the terms and
conditions of such permits or liability in connection with such releases
would not, individually or in the aggregate, have a Material Adverse
Effect. The term "Hazardous Material" means (A) any "hazardous substance"
as defined in the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, (B) any "hazardous waste" as defined in
the Resource Conservation and Recovery Act, as amended, (C) any petroleum
or petroleum product, (D) any polychlorinated biphenyl and (E) any
pollutant or contaminant or hazardous, dangerous or toxic chemical,
material, waste or substance regulated under or within the meaning of any
other Environmental Law.
(hh) NO LABOR DISPUTE. No material labor dispute with the employees
of the MarkWest Parties exists or, to the knowledge of the MarkWest
Parties, is imminent.
17
(ii) INSURANCE. The MarkWest Parties maintain insurance covering the
properties, operations, personnel and businesses of the Partnership
Entities against such losses and risks as are reasonably adequate to
protect them and their businesses in a manner consistent with other
businesses similarly situated. None of the MarkWest Parties 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, and all such insurance is outstanding and duly in
force on the date hereof and will be outstanding and duly in force on the
Closing Date.
(jj) LITIGATION. Except as described in the Prospectus or, with
respect to MarkWest, its filings with the SEC pursuant to the 1934 Act,
there is (i) no action, suit or proceeding before or by any court,
arbitrator or governmental agency, body or official, domestic or foreign,
now pending or, to the knowledge of the MarkWest Parties, threatened, to
which any of the MarkWest Parties is or may be a party or to which the
business or property of any of the MarkWest Parties is or may be subject,
(ii) no statute, rule, regulation or order that has been enacted, adopted
or issued by any governmental agency or proposed by any governmental agency
and (iii) no injunction, restraining order or order of any nature issued by
a federal or state court or foreign court of competent jurisdiction to
which any of the MarkWest Parties is or may be subject, that, in the case
of clauses (i), (ii) and (iii) above, is reasonably likely to (A)
individually or in the aggregate have a Material Adverse Effect, (B)
prevent or result in the suspension of the offering and issuance of the
Units, or (C) in any manner draw into question the validity of this
Agreement or any Operative Agreement.
(kk) PRIVATE PLACEMENT. Each of the (i) sale and issuance of the
Subordinated Units to MarkWest and MW Michigan and the Incentive
Distribution Rights to the General Partner pursuant to the Partnership
Agreement and (ii) the sale of the Subordinated Units to the Management
Group by MarkWest are exempt from the registration requirements of the 1933
Act and the securities laws of any state having jurisdiction with respect
thereto.
(ll) NO DISTRIBUTION OF OTHER OFFERING MATERIALS. None of the
MarkWest Parties have distributed and, prior to the later to occur of (i)
the Closing Date and (ii) completion of the distribution of the Units, will
not distribute, any prospectus (as defined under the ▇▇▇▇ ▇▇▇) in
connection with the offering and sale of the Units other than the
Registration Statement, the Preliminary Prospectus, the Prospectus or other
materials, if any, permitted by the 1933 Act, including Rule 134 of the
1933 Act Rules and Regulations.
(mm) LISTING. The Units have been approved for listing on the
American Stock Exchange, subject only to official notice of issuance.
(nn) DIRECTED UNIT SALES. None of the Directed Units (as defined in
Section 5(o) below) distributed in connection with the Directed Unit
Program (as defined in Section 5(o) below) will be offered or sold outside
of the United States.
18
Any certificate signed by any officer of any MarkWest Party and
delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by such MarkWest Party to each Underwriter as
to the matters covered thereby.
5. ADDITIONAL COVENANTS. The MarkWest Parties covenant and agree with the
several Underwriters that:
(a) The Partnership will timely transmit copies of the Prospectus, and any
amendments or supplements thereto, to the SEC for filing pursuant to Rule 424(b)
of the 1933 Act Rules and Regulations.
(b) The Partnership will deliver to each of the Underwriters, and to
counsel for the Underwriters (i) a signed copy of the Registration Statement as
originally filed, including copies of exhibits thereto, of any amendments and
supplements to the Registration Statement and (ii) a signed copy of each consent
and certificate included in, or filed as an exhibit to, the Registration
Statement as so amended or supplemented; the Partnership will deliver to the
Underwriters as soon as practicable after the date of this Agreement as many
copies of the Prospectus as the Underwriters may reasonably request for the
purposes contemplated by the 1933 Act; if there is a post-effective amendment to
the Registration Statement that is not effective under the 1933 Act, the
Partnership will use its best efforts to cause the post-effective amendment to
the Registration Statement to become effective as promptly as possible, and it
will notify you, promptly after it shall receive notice thereof, of the time
when the post-effective amendment to the Registration Statement has become
effective; the Partnership will promptly advise the Underwriters of any request
of the SEC for amendment of the Registration Statement or for supplement to the
Prospectus or for any additional information, and of the issuance by the SEC or
any state or other jurisdiction or other regulatory body of any stop order under
the 1933 Act or other order suspending the effectiveness of the Registration
Statement (as amended or supplemented) or preventing or suspending the use of
the Preliminary Prospectus or the Prospectus or suspending the qualification or
registration of the Units for offering or sale in any jurisdiction, and of the
institution or threat of any proceedings therefor, of which the Partnership
shall have received notice or otherwise have knowledge prior to the completion
of the distribution of the Units; and the Partnership will use its best efforts
to prevent the issuance of any such stop order or other order and, if issued, to
secure the prompt removal thereof.
(c) The Partnership will not file any amendment or supplement to the
Registration Statement, the Prospectus (or any other prospectus relating to the
Units filed pursuant to Rule 424(b) of the 1933 Act Rules and Regulations that
differs from the Prospectus as filed pursuant to such Rule 424(b)), of which the
Underwriters shall not previously have been advised or to which the Underwriters
shall have reasonably objected in writing after being so advised unless the
Partnership shall have determined based upon the advice of counsel that such
amendment or supplement is required by law; and the Partnership will promptly
notify you after it shall have received notice thereof of the time when any
amendment to the Registration Statement becomes effective or when any supplement
to the Prospectus has been filed.
19
(d) During the period when a prospectus relating to any of the Units is
required to be delivered under the 1933 Act by any Underwriter or dealer, the
Partnership will comply, at its own expense, with all requirements imposed by
the 1933 Act and the 1933 Act Rules and Regulations, so far as necessary to
permit the continuance of sales of or dealing in the Units during such period in
accordance with the provisions hereof and as contemplated by the Prospectus.
(e) If, during the period when a prospectus relating to any of the Units
is required to be delivered under the 1933 Act by any Underwriter or dealer, (i)
any event relating to or affecting the Partnership or of which the Partnership
shall be advised in writing by the Underwriters shall occur as a result of
which, in the opinion of the Partnership or the counsel for the Underwriters,
the Prospectus as then amended or supplemented would 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 or (ii) it shall be necessary to amend or
supplement the Registration Statement or the Prospectus to comply with the 1933
Act, the 1933 Act Rules and Regulations, the 1934 Act or the 1934 Act Rules and
Regulations, the Partnership will forthwith at its expense prepare and file with
the SEC, and furnish to the Underwriters a reasonable number of copies of, such
amendment or supplement or other filing that will correct such statement or
omission or effect such compliance.
(f) During the period when a prospectus relating to any of the Units is
required to be delivered under the 1933 Act by any Underwriter or dealer, the
Partnership will furnish such proper information as may be lawfully required and
otherwise cooperate with you in qualifying the Units for offer and sale under
the securities or blue sky laws of such jurisdictions as the Underwriters may
reasonably designate and will file and make such statements or reports as are or
may be reasonably necessary; PROVIDED, HOWEVER, that the Partnership shall not
be required to qualify as a foreign corporation or to qualify as a dealer in
securities or to file a general consent to service of process under the laws of
any jurisdiction.
(g) In accordance with Section 11(a) of the 1933 Act and Rule 158 of the
1933 Act Rules and Regulations, the Partnership will make generally available to
its security holders, an earning statement (which need not be audited) in
reasonable detail covering the 12-month period beginning not later than the
first day of the month next succeeding the month in which occurred the effective
date (within the meaning of Rule 158) of the Registration Statement as soon as
practicable after the end of such period.
(h) The Partnership will furnish or make available to its security holders
annual reports containing financial statements audited by independent public
accountants and quarterly reports containing financial statements and financial
information which may be unaudited. The Partnership will, for a period of two
years from the Closing Date, furnish or make available to the Underwriters a
copy of each annual report, quarterly report, current report and all other
documents, reports and information furnished by the Partnership to holders of
Units or filed with any securities exchange or market pursuant to the
requirements of such exchange or market or with the SEC pursuant to the 1933 Act
or the 1934 Act. The Partnership will deliver or make available to the
Underwriters similar reports with respect to any significant subsidiaries, as
that
20
term is defined in the 1933 Act Rules and Regulations, which are not
consolidated in the Partnership's financial statements. Any report, document or
other information required to be furnished or made available under this
paragraph (h) shall be furnished as soon as practicable after such report,
document or information becomes publicly available.
(i) The Partnership, MW Michigan and the General Partner will not, during
the 180 days after the date of this prospectus, without the prior written
consent of ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., directly or indirectly, offer for sale,
contract to sell, sell, distribute, grant any option, right or warrant to
purchase, pledge, hypothecate or otherwise dispose of any Common Units, any
securities convertible into, or exercisable or exchangeable for, Common Units
(other than the Subordinated Units) or any other rights to acquire such Common
Units, other than (1) pursuant to employee benefit plans as in existence as of
the date of the Prospectus or (2) in connection with accretive acquisitions of
assets or businesses pursuant to Section 5.7(b) or 5.7(c) of the Partnership
Agreement in which such Common Units are issued as consideration; PROVIDED,
HOWEVER, that with respect to clause (2) above, any recipient of Common Units
will furnish to ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. a letter substantially similar to that
required by Section 5(m) below with respect to the period between the date of
any such issuance and the date 180 days after the date of the Prospectus.
(j) The Partnership will apply the proceeds from the sale of the Units as
set forth in the description under "Use of Proceeds" in the Prospectus.
(k) The Partnership will promptly provide you with copies of all
correspondence to and from, and all documents issued to and by, the SEC in
connection with the registration of the Units under the 1933 Act.
(l) The Partnership will use its best efforts to obtain approval for, and
maintain the listing of the Units on, the American Stock Exchange.
(m) The Partnership will cause its directors and officers to furnish to
you, on or prior to the date of this Agreement, a letter or letters, in form and
substance satisfactory to counsel for the Underwriters, pursuant to which each
such person shall agree not to directly or indirectly, offer for sale, contract
to sell, sell, distribute, grant any option, right or warrant to purchase,
pledge, hypothecate or otherwise dispose of any Common Units, or any securities
convertible into, or exercisable or exchangeable for, Common Units (other than
Subordinated Units) or any other rights to acquire such Common Units, during the
180 days after the date of the Prospectus, without the prior written consent of
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
(n) If the Partnership elects to rely on Rule 462(b) under the 1933 Act,
the Partnership shall both file an Abbreviated Registration Statement with the
SEC in compliance with Rule 462(b) and pay the applicable fees in accordance
with Rule 111 of the 1933 Act by the earlier of (i) 10:00 p.m., New York time,
on the date of this Agreement, and (ii) the time that confirmations are given or
sent, as specified by Rule 462(b)(2).
21
(o) It is understood that up to 100,000 of the Firm Units (the "DIRECTED
UNITS") will initially be reserved by the Underwriters for offer and sale to
officers, directors, employees and persons having business relations with the
MarkWest Parties ("DIRECTED UNIT PARTICIPANTS") upon the terms and conditions
set forth in the prospectus and in accordance with the rules and regulations of
the National Association of Securities Dealers, Inc. (the "DIRECTED UNIT
PROGRAM"). Under no circumstances will ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. or any
Underwriter be liable to the MarkWest Parties or to any Directed Unit
Participant for any action taken or omitted to be taken in good faith in
connection with such Directed Unit Program. To the extent that any Directed
Units are not affirmatively reconfirmed for purchase by any Directed Unit
Participant on or immediately after the date of this Agreement, such Directed
Units may be offered to the public as part of the public offering contemplated
hereby.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of
the Underwriters to purchase and pay for the Units, as provided herein, shall be
subject to the accuracy, as of the date hereof and as of the Closing Date (and,
if applicable, the Option Closing Date), of the representations and warranties
of the MarkWest Parties contained herein, to the performance by the MarkWest
Parties of their covenants and obligations hereunder, and to the following
additional conditions:
(a) The Registration Statement and all post-effective amendments thereto
shall have become effective not later than 5:30 p.m., New York time, on the date
hereof, or, with your consent, at a later date and time, not later than 1:00
p.m., New York time, on the first business day following the date hereof, or at
such later date and time as may be approved by the Underwriters; if the
Partnership has elected to rely on Rule 462(b) under the 1933 Act, the
Abbreviated Registration Statement shall have become effective not later than
the earlier of (x) 10:00 p.m. New York time, on the date hereof, or (y) at such
later date and time as may be approved by the Underwriters. All filings required
by Rule 424 and Rule 430A of the 1933 Act Rules and Regulations shall have been
made. No stop order suspending the effectiveness of the Registration Statement
shall have been issued and no proceeding for that purpose shall have been
initiated or, to the knowledge of the Partnership or any Underwriter, threatened
or contemplated by the SEC, and any request of the SEC for additional
information (to be included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to the reasonable satisfaction of the
Underwriters.
(b) No Underwriter shall have advised the Partnership on or prior to the
Closing Date (and, if applicable, the Option Closing Date), that the
Registration Statement or Prospectus or any amendment or supplement thereto
contains an untrue statement of fact which, in the opinion of counsel to the
Underwriters, is material, or omits to state a 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, in light of the circumstances under which they
were made, not misleading.
(c) On the Closing Date (and, if applicable, the Option Closing Date), you
shall have received the opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P. counsel for the
Partnership, addressed to you and dated the Closing Date (and, if applicable,
the Option Closing Date), to the effect that:
22
(i) The Partnership has been duly formed and is validly existing
in good standing as a limited partnership under the Delaware LP Act with
all necessary partnership power and authority to own or lease its
properties owned or leased at the Closing Date (and, if applicable, the
Option Closing Date), to assume the liabilities being assumed by it
pursuant to the Contribution Documents and to conduct its business in all
material respects as described in the Registration Statement and the
Prospectus. The Partnership is duly registered or qualified as a foreign
limited partnership for the transaction of business under the laws of the
jurisdictions set forth on EXHIBIT A to this Agreement.
(ii) Each of the General Partner, the Operating Company and
MarkWest Appalachia LLC has been duly formed and is validly existing in
good standing as a limited liability company under the Delaware LLC Act
with all necessary limited liability company power and authority to own or
lease its properties owned or leased at the Closing Date (and, if
applicable, the Option Closing Date), to assume the liabilities being
assumed by it pursuant to the Contribution Documents and to conduct its
business in all material respects as described in the Registration
Statement and the Prospectus. The General Partner has all necessary limited
liability company power and authority to act as general partner of the
Partnership. Each of the General Partner, the Operating Company and
MarkWest Appalachia LLC is duly registered or qualified as a foreign
limited liability company for the transaction or business under the laws of
the jurisdictions set forth on EXHIBIT A to this Agreement.
(iii) MarkWest has been duly incorporated and is validly existing in
good standing as a corporation under the DGCL with all necessary corporate
power and authority to own or lease its properties owned or leased at the
Closing Date (and, if applicable, the Option Closing Date) and to conduct
its business in all material respects as described in the Registration
Statement and the Prospectus.
(iv) The General Partner is the sole general partner of the
Partnership. The General Partner owns a 2% general partner interest in the
Partnership; such general partner interest has been duly authorized and
validly issued in accordance with the Partnership Agreement; and the
General Partner owns its general partner interest free and clear of all
liens, encumbrances, security interests, charges or claims (i) 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 (ii) otherwise
known to such counsel, without independent investigation, other than those
created by or arising under the Delaware LP Act.
(v) MarkWest owns 1,752,136 Subordinated Units, MW Michigan owns
1,223,000 Subordinated Units, the Management Groups owns 24,864
Subordinated Units as described in the Prospectus and the General Partner
owns all of the Incentive Distribution Rights; all of such Subordinated
Units and the limited partner interests represented thereby and the
Incentive Distribution Rights have been duly authorized and
23
validly issued in accordance with the Partnership Agreement, and are fully
paid (to the extent required under the Partnership Agreement) and
nonassessable (except as such nonassessability may be affected by matters
described in the Prospectus under the caption "The Partnership
Agreement--Limited Liability"); and each of MarkWest, MW Michigan and the
Management Group will own its respective Subordinated Units and the General
Partner will own the Incentive Distribution Rights, in each case, free and
clear of all liens, encumbrances (except restrictions on transferability as
described in the Prospectus or liens or encumbrances granted by members of
the Management Group), security interests, charges or claims (i) in respect
of which a financing statement under the Uniform Commercial Code of the
State of Delaware naming MarkWest, MW Michigan, any member of the
Management Group or the General Partner as debtor is on file in the office
of the Secretary of State of the State of Delaware, (ii) arising under the
Bank Credit Agreement or the Parent Credit Agreement or (iii) otherwise
known to such counsel, without independent investigation, other than those
created by or arising under the Delaware LP Act.
(vi) The Units to be issued and sold to the Underwriters by the
Partnership pursuant to this Agreement 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 hereof, will be validly issued, fully paid (to
the extent required under the Partnership Agreement) and nonassessable
(except as such nonassessability may be affected by matters described in
the Prospectus under the caption "The Partnership Agreement--Limited
Liability"); and other than the Subordinated Units and the Incentive
Distribution Rights, the Units will be the only limited partner interests
of the Partnership issued and outstanding at the Closing Date.
(vii) MarkWest owns of record 91.4% of the issued and outstanding
membership interests of the General Partner and the Management Group owns
of record 8.6% of the issued and outstanding membership interests of the
General Partner as described in the Prospectus. Such membership interests
have been duly authorized and validly issued and are fully paid and
nonassessable (except as such nonassessability may be affected by Section
18-607 of the Delaware LLC Act); and MarkWest and the Management Group own
such membership interests free and clear of all liens, encumbrances (except
liens or encumbrances granted by members of the Management Group), security
interests, charges or claims (i) in respect of which a financing statement
under the Uniform Commercial Code of the State of Delaware naming MarkWest
or any member of the Management Group as debtor is on file in the office of
the Secretary of State of the State of Delaware, (ii) arising under the
Bank Credit Agreement or the Parent Credit Agreement or (iii) otherwise
known to such counsel, without independent investigation, other than those
created by or arising under the Delaware LLC Act.
(viii) The Partnership owns a 100% membership interest in the
Operating Company; such membership interest has been duly authorized and
validly issued in accordance with the Operating Company LLC Agreement and
is fully paid (to the extent
24
required under the Operating Company LLC Agreement) and nonassessable
(except as such nonassessability may be affected by Section 18-607 of the
Delaware LLC Act); and the Partnership will own such membership interest
free and clear of all liens, encumbrances, security interests, charges or
claims (i) 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 (ii) otherwise known to such counsel, without independent investigation,
other than those created by or arising under the Delaware LLC Act.
(ix) The Operating Company owns of record 100% of the issued and
outstanding membership interests in each of the Operating Subs; the
membership interests of MarkWest Appalachia LLC have been duly authorized
and validly issued in accordance with its limited liability company
agreement and are fully paid (to the extent required under the its limited
liability company agreements) and nonassessable (except as such
nonassessability may be affected by Section 18-607 of the Delaware LLC
Act); and the Operating Company owns such membership interests free and
clear of all liens, encumbrances, security interests, charges or claims (i)
in respect of which a financing statement under the Uniform Commercial Code
of the State of Delaware naming the Operating Company as debtor is on file
in the office of the Secretary of State of the State of Delaware or (ii)
otherwise known to such counsel, without independent investigation, other
than those created by or arising under the Delaware LLC Act.
(x) Except as described in the Prospectus, there are no preemptive
rights or other rights to subscribe for or to purchase, nor any restriction
upon the voting or transfer of, (i) any limited partner interests of the
Partnership or (ii) any membership interests of the General Partner, the
Operating Company or MarkWest Appalachia LLC pursuant to the Partnership
Agreement, the General Partner LLC Agreement, the Operating Company LLC
Agreement or the limited liability company agreement of MarkWest Appalachia
LLC, respectively, or, to the knowledge of such counsel, any other
agreement or instrument listed as an exhibit to the Registration Statement
to which such entities are a party or by which any of them may be bound. To
the knowledge of such counsel and except as described in the Partnership
Agreement, 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, other than as have been waived. To such
counsel's knowledge, except as described in the Prospectus, there are no
outstanding options or warrants to purchase any partnership or any
membership interests in the Partnership, the Operating Company or MarkWest
Appalachia LLC.
(xi) Each of the Operative Agreements (other than the Bank Credit
Agreement) to which any of the MarkWest Parties other than MW Michigan,
Basin LLC and West Shore LLC (the "MARKWEST DELAWARE PARTIES") is a party
has been duly authorized and validly executed and delivered by such entity
that is a party thereto. Assuming due authorization, execution and delivery
by each entity to such agreement other than the MarkWest Delaware Parties,
each of the Operative Agreements (other than any Operative
25
Agreements governed by law other than Texas, New York or Delaware law and
other than the Bank Credit Agreement, as to which such counsel need not
express any opinion) constitutes a valid and legally binding agreement of
the MarkWest Parties that are parties thereto, enforceable against such
entity in accordance with its respective terms, subject to (i) applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally and by
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and (ii) public policy,
applicable law relating to the fiduciary duties and indemnification and
contribution and an implied covenant of good faith and fair dealing.
(xii) The Partnership has all requisite power and authority to
issue, sell and deliver (i) the Units, in accordance with and upon the
terms and conditions set forth in this Agreement, the Partnership
Agreement, the Registration Statement and the Prospectus and (ii) the
Subordinated Units and Incentive Distribution Rights, in accordance with
and upon the terms and conditions set forth in the Partnership Agreement
and the Contribution Documents.
(xiii) This Agreement has been duly authorized and validly executed
and delivered by each of the MarkWest Delaware Parties.
(xiv) None of the offering, issuance and sale by the Partnership of
the Units, the execution, delivery and performance of this Agreement or the
Operative Agreements (other than any Operative Agreements governed by law
other than Texas, New York or Delaware law and other than the Bank Credit
Agreement, as to which such counsel need not express any opinion) by the
MarkWest Parties that are parties thereto, or the consummation of the
transactions contemplated hereby or thereby (including the Transactions)
(i) constitutes or will constitute a violation of the agreement of limited
partnership, limited liability company agreement, certificate or articles
of incorporation or bylaws of any of the MarkWest Delaware Parties, (ii)
constitutes or will constitute a violation of, or a default (or an event
that, with notice or lapse of time or both, would constitute such default)
under, any Operative Agreement (other than any Operative Agreement governed
by law other than Texas, New York or Delaware law and other than the Bank
Credit Agreement), (iii) violates or will violate the Delaware LP Act, the
Delaware LLC Act, the DGCL, Texas law, New York law or federal law 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 MarkWest Delaware
Parties, 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 business, financial
condition or results of operations of the Partnership Entities taken as a
whole.
(xv) No permit, consent, approval, authorization, order,
registration, filing or qualification ("consent") under the Delaware LP
Act, the Delaware LLC Act, the DGCL, Texas law or federal law is required
for the offering, issuance and sale by the Partnership of the Units, the
execution, delivery and performance of this Agreement or the Operative
Agreements (other than any Operative Agreement governed by law other than
Texas,
26
New York or Delaware law and other than the Bank Credit Agreement) by the
MarkWest Parties that are party thereto or the consummation by the MarkWest
Parties of the transactions contemplated by this Agreement, except (i) for
such consents required under the 1933 Act, the 1934 Act or under state
securities or "Blue Sky" laws, as to which such counsel need not express
any opinion, (ii) for such consents which have been obtained or made, (iii)
for such consents which (A) are of a routine or administrative nature, (B)
are not customarily obtained or made prior to the consummation of
transactions such as those contemplated by this Agreement and the Operative
Agreements and (C) are expected in the reasonable judgment of the General
Partner to be obtained or made in the ordinary course of business
subsequent to the consummation of the Transactions, (iv) for such consents
which, if not obtained or made, would not, individually or in the
aggregate, have a Material Adverse Effect or (v) as disclosed in the
Prospectus.
(xvi) The statements in the Registration Statement and Prospectus
under the captions "Cash Distribution Policy," "Certain Relationships and
Related Transactions," "Conflicts of Interest and Fiduciary
Responsibilities," "Description of the Common Units" and "The Partnership
Agreement" accurately describe in all material respects the portions of the
documents addressed thereby and, insofar as they purport to constitute
summaries of law or legal conclusions, are accurate in all material
respects; the description of the statutes and regulations set forth in the
Registration Statement and Prospectus under the caption
"Business--Environmental Matters" accurately describe in all material
respects the portions of the statutes and regulations addressed thereby;
and the Common Units, the Subordinated Units and the Incentive Distribution
Rights conform in all material respects to the descriptions thereof
contained in the Registration Statement and the Prospectus under the
captions "Prospectus Summary--The Offering," "Cash Distribution Policy,"
"Description of the Common Units" and "The Partnership Agreement."
(xvii) The opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P. that is filed as Exhibit
8.1 to the Registration Statement is confirmed and the Underwriters may
rely upon such opinion as if it were addressed to them.
(xviii) The Registration Statement was declared effective under the
1933 Act on May 20, 2002; 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.
(xix) The Registration Statement and the Prospectus (except for the
financial statements and the notes and the schedules thereto, and the other
financial, statistical and accounting data 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 1933 Act and the rules and regulations promulgated thereunder.
27
(xx) To the knowledge of such counsel, (i) there are no legal or
governmental proceedings pending or threatened against any of the MarkWest
Parties or to which any of the MarkWest Parties is a party or to which any
of their respective properties is subject that are required to be described
in the Prospectus but are not so described as required and (ii) 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 exhibits to the Registration Statement that are not
described or filed as required by the 1933 Act.
(xxi) None of the MarkWest Delaware Parties is an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended.
(xxii) None of the Partnership, the General Partner or the Operating
Company is, or solely as a result of the Transactions will be, a "public
utility company" or a "holding company" within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(xxiii) Each of (i) the offer, sale and issuance of the Subordinated
Units to MarkWest and MW Michigan and the Incentive Distribution Rights to
the General Partner pursuant to the Partnership Agreement and (ii) the sale
of the Subordinated Units and the LLC interests in the General Partner to
the Management Group by MarkWest are exempt from the registration
requirements of the 1933 Act.
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the MarkWest Parties, the
independent public accountants of the Partnership, and the Underwriters, 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), based on the foregoing, no information has come to such
counsel's attention that causes such counsel to believe that the Registration
Statement (other than (i) the financial statements included therein, including
the notes and schedules thereto and the auditors' reports thereon, and (ii) the
other financial, statistical and reserve data included 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 therein,
including the notes and schedules thereto and the auditors' reports thereon, and
(ii) the other financial, statistical and reserve data included therein, as to
which such counsel need not comment), as of its issue date and the Closing Date
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
28
In rendering such opinion, such counsel may (A) rely in respect of matters
of fact upon representations of the MarkWest Parties set forth in this Agreement
and upon certificates of officers and employees of the MarkWest Parties 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, Texas law and the
contract law of the State of New York, (D) state that they express no opinion
with respect to the title of any of the MarkWest Parties to any of their
respective real or personal property purported to be transferred by the
Contribution Documents nor with respect to the accuracy or descriptions of real
or personal property, and (E) state that they express 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 other MarkWest Parties may be subject.
(d) On the Closing Date (and, if applicable, the Option Closing Date), you
shall have received the opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, counsel for the
Partnership, addressed to you and dated the Closing Date (and, if applicable,
the Option Closing Date), to the effect that:
(i) MW Michigan has been duly incorporated and is validly existing
in good standing as a corporation under the CBCA with all necessary
corporate power and authority to own or lease its properties and to conduct
its business in all material respects as described in the Registration
Statement and the Prospectus.
(ii) MarkWest owns of record 100% of the issued and outstanding
capital stock of MW Michigan.
(iii) This Agreement has been duly executed and delivered by MW
Michigan.
(iv) Each of the Operative Agreements to which MW Michigan is a
party has been duly authorized and validly executed and delivered by MW
Michigan. Each of the Operative Agreements of which MW Michigan is a party
constitutes a valid and legally binding agreement of MW Michigan,
enforceable against MW Michigan in accordance with its respective terms,
subject to (i) applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws relating to or affecting
creditors' rights generally and by general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
at law) and (ii) public policy, applicable law relating to the fiduciary
duties and indemnification and an implied covenant of good faith and fair
dealing.
(v) Each of the Colorado Operative Agreements constitutes a valid
and legally binding agreement of the MarkWest Parties that are parties
thereto, enforceable against such entity in accordance with its respective
terms, subject to (i) applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws relating to or
affecting creditors' rights generally and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (ii)
29
public policy, applicable law relating to the fiduciary duties and
indemnification and an implied covenant of good faith and fair dealing.
(vi) None of the execution, delivery and performance of this
Agreement or the Operative Agreements to which MW Michigan is a party by MW
Michigan, or the consummation of the transactions contemplated hereby or
thereby (including the Transactions) (i) constitutes or will constitute a
violation of the certificate or articles of incorporation or bylaws of MW
Michigan, (ii) constitutes or will constitute a breach or violation of, or
a default (or an event which, with notice or lapse of time or both, would
constitute such default) under, any Operative Agreement, (iii) violates or
will violate Colorado or federal law or (iv) results or will result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of MW Michigan, which 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 condition (financial or
other), business or results of operations of the Partnership Entities.
(vii) None of the execution, delivery and performance of the
Colorado Operative Agreements by the MarkWest Parties that are parties
thereto, or the consummation of the transactions contemplated hereby or
thereby (including the Transactions) (i) constitutes or will constitute a
violation of the agreement of limited partnership, limited liability
company agreement, certificate or articles of incorporation, bylaws or
other organizational documents of any of the MarkWest Parties, (ii)
constitutes or will constitute a breach or violation of, or a default (or
an event which, with notice or lapse of time or both, would constitute such
default) under, any Operative Agreement, (iii) violates or will violate,
Colorado or federal law 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 MarkWest Parties, which 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 condition
(financial or other), business or results of operations of the Partnership
Entities.
(viii) The execution, delivery and performance of the Bank Credit
Agreement by the MarkWest Parties that are parties thereto, and the
consummation of the transactions contemplated thereby, will not constitute
a violation of, or a default (or an event that, with notice or lapse of
time or both, would constitute such default) under, any Operative
Agreement, which conflicts, breaches, violations, defaults or liens would,
individually or in the aggregate, have a material adverse effect on the
business, financial condition or results of operations of the Partnership
Entities taken as a whole.
(ix) No permit, consent, approval, authorization, order,
registration, filing or qualification ("consent") of or with any Colorado
court, governmental agency or body having jurisdiction over MW Michigan is
required for the offering, issuance and sale by the Partnership of the
Units, the execution, delivery and performance of this Agreement or the
Operative Agreements to which MW Michigan is a party by MW Michigan or the
consummation by MW Michigan of the transactions contemplated by this
Agreement,
30
except (i) for such consents required under the 1933 Act, the 1934 Act and
state securities or "Blue Sky" laws, as to which such counsel need not
express any opinion, (ii) for such consents which have been obtained or
made, (iii) for such consents which (A) are of a routine or administrative
nature, (B) are not customarily obtained or made prior to the consummation
of transactions such as those contemplated by this Agreement and the
Operative Agreements and (C) are expected in the reasonable judgment of the
General Partner to be obtained or made in the ordinary course of business
subsequent to the consummation of the Transactions, (iv) for such consents
which, if not obtained or made, would not, individually or in the
aggregate, have a Material Adverse Effect or (v) as disclosed in the
Prospectus.
(x) No permit, consent, approval, authorization, order,
registration, filing or qualification ("consent") of or with any Colorado
court, governmental agency or body having jurisdiction over any of the
MarkWest Parties is required for the execution, delivery and performance of
the Colorado Operative Agreements by the MarkWest Parties that are party
thereto, except (i) for such consents which have been obtained or made,
(ii) for such consents which (A) are of a routine or administrative nature,
(B) are not customarily obtained or made prior to the consummation of
transactions such as those contemplated by this Agreement and the Operative
Agreements and (C) are expected in the reasonable judgment of the General
Partner to be obtained or made in the ordinary course of business
subsequent to the consummation of the Transactions, (iii) for such consents
which, if not obtained or made, would not, individually or in the
aggregate, have a Material Adverse Effect or (iv) as disclosed in the
Prospectus.
(xi) To the knowledge of such counsel, (i) there are no legal or
governmental proceedings pending or threatened against any of the MarkWest
Parties or to which any of the MarkWest Parties is a party or to which any
of their respective properties is subject that are required to be described
in the Prospectus but are not so described as required and (ii) 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 exhibits to the Registration Statement that are not
described or filed as required by the 1933 Act.
In rendering such opinion, such counsel may (A) rely in respect of matters
of fact upon representations of the MarkWest Parties set forth in this Agreement
and upon certificates of officers and employees of the MarkWest Parties 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 the opinion is limited to federal
and Colorado law, (D) state that they express no opinion with respect to the
title of any of the MarkWest Parties to any of their respective real or personal
property purported to be transferred by the Contribution Documents nor with
respect to the accuracy or descriptions of real or personal property, and (E)
state that they express 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
other MarkWest Parties may be subject.
31
(e) On the Closing Date, you shall have received the opinion of each of
Loomis, Ewert, Parsley, ▇▇▇▇▇ and Gotting, opining as to the law of Michigan and
McBrayer, McGinnis, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, opining as to the respective laws of West
Virginia and Kentucky, addressed to you and dated the Closing Date (and, if
applicable, the Option Closing Date), to the effect that:
(i) Each of West Shore LLC and Basin LLC has been duly formed and
is validly existing in good standing as a limited liability company under
the Michigan LLC Act with all necessary limited liability company power and
authority to own or lease its properties owned or leased at the Closing
Date (and, if applicable, the Option Closing Date), to assume the
liabilities being assumed by it pursuant to the Contribution Documents and
to conduct its business in all material respects as described in the
Registration Statement and the Prospectus. [Michigan counsel only.]
(ii) Each of [insert applicable MarkWest Parties] is duly qualified
or registered as a foreign limited liability company for the transaction of
business under the laws of [insert applicable state].
(iii) The Operating Company owns of record 100% of the issued and
outstanding membership interests in each of West Shore LLC and Basin LLC;
the membership interests of each of West Shore LLC and Basin LLC have been
duly authorized and validly issued in accordance with its respective
limited liability company agreement and are fully paid (to the extent
required under such limited liability company agreements) and
nonassessable; and the Operating Company owns such membership interests
free and clear of all liens, encumbrances, security interests, charges or
claims (i) in respect of which a financing statement under the Uniform
Commercial Code of the State of Michigan naming the Operating Company as
debtor is on file in the office of the Secretary of State of the State of
Michigan or (ii) otherwise known to such counsel, without independent
investigation, other than those created by or arising under the Michigan
LLC Act. [Michigan counsel only.]
(iv) Except as described in the Prospectus, there are no preemptive
rights or other rights to subscribe for or to purchase, nor any restriction
upon the voting or transfer of, (i) any membership interests of West Shore
LLC or Basin LLC pursuant to the limited liability company agreements of
West Shore and Basin, respectively, or, to the knowledge of such counsel,
any other agreement or instrument listed as an exhibit to the Registration
Statement to which such entities are a party or by which any of them may be
bound. To the knowledge of such counsel, except as described in the
Prospectus, there are no outstanding options or warrants to purchase any
membership interests in West Shore or Basin. [Michigan counsel only.]
(v) Each of [insert applicable MarkWest Parties] has all requisite
power and authority as a limited liability company or limited partnership,
as the case may be, under the laws of the State of [insert applicable
state] to own or lease its properties and to conduct its business in the
State of [insert applicable state] in each case in all material respects to
the same extent as described or otherwise disclosed in the Prospectus with
32
respect to the Partnership; and upon the consummation of the Transactions
(assuming that the Partnership will not be liable under the laws of the
State of Delaware for the liabilities of the Operating Company or the
Operating Subs and assuming that the holders of Units will not be liable
under the laws of the State of Delaware for the liabilities of the
Partnership, the Operating Company or the Operating Subs), the Partnership
will not be liable under the laws of the State of [insert applicable state]
for the liabilities of the Operating Company or the Operating Subs, and the
holders of Units will not be liable under the laws of the State of [insert
applicable state] for the liabilities of the Partnership, except to the
same extent as under the laws of the State of Delaware.
(vi) Each of the Operative Agreements to which West Shore LLC and
Basin LLC is a party has been duly authorized and validly executed and
delivered by such party that is a party thereto. [Michigan counsel only.]
(vii) This Agreement has been duly authorized and validly executed
and delivered by each of West Shore LLC and Basin LLC. [Michigan counsel
only.]
(viii) None of the offering, issuance and sale by the Partnership of
the Units, the execution, delivery and performance of this Agreement or the
Operative Agreements by the MarkWest Parties that are parties thereto, or
the consummation of the transactions contemplated hereby or thereby
(including the Transactions) (i) constitutes or will constitute a violation
of the limited liability company agreement of West Shore LLC or Basin LLC,
(ii) violates or will violate Michigan law or (iii) results or will result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of West Shore LLC or Basin LLC, which conflicts,
breaches, violations, defaults or liens, in the case of clauses (ii) or
(iii) would, individually or in the aggregate, have a material adverse
effect on the business, financial condition or results of operations of the
Partnership Entities taken as a whole. [Michigan counsel only.]
(ix) No permit, consent, approval, authorization, order,
registration, filing or qualification ("consent") of or with any court,
governmental agency or body of the State of [insert applicable state],
having jurisdiction over the MarkWest Parties or any of their respective
properties, is required for (i) the issuance and sale of the Units by the
Partnership, (ii) the execution and delivery by each of the MarkWest
Parties, and the performance by such entities of their obligations under,
the Operative Agreements to which they are a party, or (iii) the conveyance
of the properties located in the State of [insert applicable state]
purported to be conveyed to the respective parties pursuant to the
Contribution Documents, except (A) for such consents required under the
Securities Act, the Exchange Act and state securities or "Blue Sky" laws,
as to which such counsel need express no opinion, (B) for such consents
which have been obtained or made, (C) for such consents which are (1) of a
routine or administrative nature, (2) not customarily obtained or made
prior to the consummation of transactions such as those contemplated under
the Operative Agreements, and (3) expected in the reasonable judgment of
the General Partner to be obtained or made in the ordinary course of
business subsequent to the consummation of the Transactions, (D) for such
consents which, if not obtained or made, would not, individually or in the
aggregate, have a material adverse effect upon the
33
operations conducted or to be conducted as described in the Prospectus in
the State of [insert applicable state] by the Partnership Entities, taken
as a whole or (E) as disclosed in the Prospectus with respect to the
Partnership.
(x) The execution, delivery and performance of the Conveyances
relating to the transfer of property in the State of [insert applicable
state] has not violated and will not violate any statute of the State of
[insert applicable state] or any rule, regulation or, to such counsel's
knowledge, any order of any agency of the State of [insert applicable
state] having jurisdiction over any of the MarkWest Parties or any of their
respective properties, except for any such violations which, individually
or in the aggregate, would not have a material adverse effect on the
holders of Units or the operations conducted in the State of [insert
applicable state] by the Partnership Entities, taken as a whole.
(xi) Each of the Conveyances is in a form legally sufficient as
between the parties thereto to convey to the transferee thereunder all of
the right, title and interest of the transferor stated therein in and to
the properties located in the State of [insert applicable state], as
described in the Conveyances, subject to the conditions, reservations and
limitations contained in the Conveyances, except motor vehicles or other
property requiring conveyance of certificated title as to which the
Conveyances are legally sufficient to compel delivery of such certificated
title.
(xii) Each of the deeds and real property assignments (including,
without limitation, the form of the exhibits and schedules thereto) is in a
form legally sufficient for recordation in the appropriate public offices
of the State of [insert applicable state], to the extent such recordation
is required to constitute notice to third parties that title to the
properties covered thereby is in the applicable Partnership Entity, and,
upon proper recordation of any such deeds and real property assignments in
the State of [insert applicable state], will constitute notice to all third
parties under the recordation statutes of the State of [insert applicable
state] concerning record title to the assets covered thereby; recordation
in the office of the County Clerk of each county in which each of the
applicable Partnership Entity owns property is the appropriate public
office in the State of [insert applicable state] for the recordation of
deeds, assignments and other evidences of title evidencing interests in
real property located in such county.
(xiii) To the knowledge of such counsel after due inquiry, each of
the MarkWest Parties has such permits, consents, licenses, franchises,
certificates and authorizations of governmental or regulatory authorities
("permits") of the State of [insert applicable state] as are necessary to
own its properties and to conduct its business in the state of [insert
applicable state] in the manner described in the Prospectus, subject to
such qualifications as may be set forth in the Prospectus and except for
such permits which, if not obtained, would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and, to
the knowledge of such counsel after due inquiry, none of the MarkWest
Parties has received any notice of proceedings relating to the revocation
or modification of any such permits which, individually or in the
aggregate, if the subject of
34
an unfavorable decision, ruling or finding, would reasonably be expected to
have a Material Adverse Effect.
In rendering such opinions, such counsel shall state that it (1) relied in
respect of matters of fact upon certificates of officers and employees of the
MarkWest Parties and upon information obtained from public officials including,
without limitation, certificates of foreign qualification for each of the
MarkWest Parties provided by the Secretary of State of [insert applicable state]
dated as of a recent date, with respect to the opinion in paragraphs (i) and
(ii) above, and (2) assumed that all documents submitted to such counsel as
originals are authentic, and all copies submitted to such counsel conform to the
originals thereof, and that the signatures on all documents examined by such
counsel are genuine.
The opinions expressed by such counsel may be limited to the laws of the
State of [insert applicable state], excepting therefrom municipal and local
ordinances and regulations. Such counsel need not express an opinion with
respect to (i) title to any of the real or personal property, (ii) the accuracy
of descriptions or references to real or personal property, (iii) permits to own
or operate any real or personal property, or (iv) with respect to state or local
taxes or tax statutes including, without limitation, those to which any of the
limited partners of the MarkWest Parties may be subject.
In rendering such opinion, such counsel shall state that each of the
MarkWest Parties, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P., ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇
L.L.P. are hereby authorized to rely upon such opinion letter in connection with
the Transactions as if such opinion letter were addressed and delivered to each
of them.
(f) On the Closing Date (and, if applicable, the Option Closing Date), you
shall have received the opinion of ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel for the
Partnership, addressed to you and dated the Closing Date (and, if applicable,
the Option Closing Date), to the effect that:
(i) The Bank Credit Agreement has been duly authorized and validly
executed and delivered by each of the MarkWest Parties that is a party
thereto.
(ii) The execution, delivery and performance of the Bank Credit
Agreement by the MarkWest Parties that are parties thereto, and the
consummation of the transactions contemplated thereby will not (i)
constitute a violation of the agreement of limited partnership, limited
liability company agreement, certificate or articles of incorporation or
bylaws of any of the MarkWest Parties, (ii) violate the Delaware LP Act,
the Delaware LLC Act, Colorado law or federal law or (iii) result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of any of the MarkWest Parties (other than for the benefit of the
lenders under the Bank Credit Agreement), which conflicts, breaches,
violations, defaults or liens, in the case of clauses (ii) or (iii) would,
individually or in the aggregate, have a material adverse effect on the
business, financial condition or results of operations of the Partnership
Entities taken as a whole.
(iii) No permit, consent, approval, authorization, order,
registration, filing or qualification ("consent") of or with any federal or
Delaware court, governmental agency
35
or body having jurisdiction over any of the MarkWest Parties is required
for the execution, delivery and performance of the Bank Credit Agreement by
the MarkWest Parties that are party thereto, except (i) for such consents
required under the 1933 Act, the 1934 Act and state securities or "Blue
Sky" laws, as to which such counsel need not express any opinion, (ii) for
such consents which have been obtained or made, (iii) for the perfection,
preservation or continuation of the security interests and liens granted by
the collateral documents provided for in the Bank Credit Agreement made
prior to or after the execution and delivery of the Bank Credit Agreement,
(iv) for such consents which (A) are of a routine or administrative nature,
(B) are not customarily obtained or made prior to the consummation of
transactions such as those contemplated by the Bank Credit Agreement and
(C) are expected in the reasonable judgment of the General Partner to be
obtained or made in the ordinary course of business subsequent to the
execution and delivery of the Bank Credit Agreement or (v) for such
consents which, if not obtained or made, would not, individually or in the
aggregate, have a Material Adverse Effect.
(g) You shall have received on the Closing Date (and, if applicable, the
Option Closing Date), from ▇▇▇▇▇ ▇▇▇▇▇ L.L.P., counsel to the Underwriters, such
opinion or opinions, dated the Closing Date (and, if applicable, the Option
Closing Date) with respect to such matters as you may reasonably require; and
the Partnership shall have furnished to such counsel such documents as they
reasonably request for the purposes of enabling them to review or pass on the
matters referred to in this Section 6 and in order to evidence the accuracy,
completeness and satisfaction of the representations, warranties and conditions
herein contained.
(h) You shall have received at or prior to the Closing Date from ▇▇▇▇▇
▇▇▇▇▇ L.L.P. a memorandum or memoranda, in form and substance satisfactory to
you, with respect to the qualification for offering and sale by the Underwriters
of the Units under state securities or Blue Sky laws of such jurisdictions as
the Underwriters may have designated to the Partnership.
(i) On the date of this Agreement and on the Closing Date (and, if
applicable, the Option Closing Date), you shall have received from
PricewaterhouseCoopers LLC, a letter or letters, dated the date of this
Agreement and the Closing Date (and, if applicable, the Option Closing Date),
respectively, in form and substance satisfactory to you, confirming that they
are independent public accountants with respect to the Partnership and the
General Partner within the meaning of the 1933 Act and 1933 Act Rules and
Regulations, and stating to the effect set forth in Schedule II hereto.
(j) Except as set forth in the Registration Statement and the Prospectus,
(i) none of the Partnership Entities shall have sustained since the date of the
latest audited financial statements included in the Registration Statement and
in the Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree; and (ii)
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), none of the MarkWest Parties shall have incurred any liability or
obligation, direct or contingent, or entered into any transactions, and there
shall not have been any change in the capital stock or short-term or long-
36
term debt of the Partnership Entities or any change, or any development
involving or which might reasonably be expected to involve a prospective change
in the condition (financial or other), net worth, business, affairs, management,
prospects, results of operations or cash flow of the Partnership or its
subsidiaries, the effect of which, in any such case described in clause (i) or
(ii), is in your judgment so material or adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the Units
being delivered on such Closing Date (and, if applicable, the Option Closing
Date) on the terms and in the manner contemplated in the Prospectus.
(k) There shall not have occurred any of the following: (i) a suspension
or material limitation in trading in securities generally on the American Stock
Exchange or the establishing on such exchanges or market by the SEC or by such
exchanges or markets of minimum or maximum prices which are not in force and
effect on the date hereof; (ii) a suspension or material limitation in trading
in the Partnership's securities on the American Stock Exchange or the
establishing on such market by the SEC or by such market of minimum or maximum
prices which are not in force and effect on the date hereof; (iii) a general
moratorium on commercial banking activities declared by either federal or any
Missouri authorities; (iv) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war, which in your judgment makes it impracticable or inadvisable
to proceed with the public offering or the delivery of the Units in the manner
contemplated in the Prospectus; or (v) any calamity or crisis, change in
national, international or world affairs, act of God, change in the
international or domestic markets, or change in the existing financial,
political or economic conditions in the United States or elsewhere, the effect
of which on the financial markets of the United States is such as to make it in
your judgment impracticable or inadvisable to proceed with the public offering
or the delivery of the Units in the manner contemplated in the Prospectus.
(l) You shall have received (x) a certificate, dated the Closing Date
(and, if applicable, the Option Closing Date) and signed by chief executive
officer and the chief financial officer of the General Partner, in their
capacities as such, and (y) a certificate, dated the Closing Date (and, if
applicable, the Option Closing Date) and signed by the chief executive officer
and the chief financial officer of MarkWest, in their capacities as such,
stating that:
(i) the condition set forth in Section 6(a) has been fully
satisfied;
(ii) they have examined the Registration Statement and the
Prospectus as amended or supplemented and nothing has come to their
attention that would lead them to believe that either the Registration
Statement or the Prospectus, or any amendment or supplement thereto as of
their respective effective, issue or filing dates, contained, and the
Prospectus as amended or supplemented and at such Closing Date, contains
any untrue statement of a material fact, or omits to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
37
(iii) since the Effective Date, there has occurred no event
required to be set forth in an amendment or supplement to the Registration
Statement or the Prospectus which has not been so set forth;
(iv) all representations and warranties made herein by the MarkWest
Parties are true and correct at such Closing Date, with the same effect as
if made on and as of such Closing Date, and all agreements herein to be
performed or complied with by the MarkWest Parties on or prior to such
Closing Date have been duly performed and complied with by the MarkWest
Parties;
(v) each of the MarkWest Parties has performed all obligations
required to be performed by it pursuant to this Agreement;
(vi) no stop order has been issued;
(vii) the Units have been approved for listing on the American Stock
Exchange; and
(viii) covering such other matters as you may reasonably request.
(m) The MarkWest Parties shall not have failed, refused, or been unable,
at or prior to the Closing Date (and, if applicable, the Option Closing Date) to
have performed any agreement on their part to be performed or any of the
conditions herein contained and required to be performed or satisfied by them at
or prior to such Closing Date.
(n) The Partnership shall have furnished to you at the Closing Date (and,
if applicable, the Option Closing Date) such further information, opinions,
certificates, letters and documents as you may have reasonably requested.
(o) The American Stock Exchange shall have approved the units for listing,
subject only to official notice of issuance.
(p) You shall have received duly and validly executed letter agreements
referred to in Section 5(m) hereof.
All such opinions, certificates, letters and documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and to ▇▇▇▇▇ ▇▇▇▇▇ L.L.P., counsel for the several
Underwriters. The Partnership will furnish you with such signed and conformed
copies of such opinions, certificates, letters and documents as you may request.
If any of the conditions specified above in this Section 6 shall not have
been satisfied at or prior to the Closing Date (and, if applicable, the Option
Closing Date) or waived by you in writing, this Agreement may be terminated by
you on notice to the Partnership.
38
7. INDEMNIFICATION AND CONTRIBUTION. (a) The MarkWest Parties, jointly
and severally, will indemnify and hold harmless each Underwriter from and
against any losses, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the 1933 Act or otherwise, insofar as such
losses, damages or liabilities (or actions or claims in respect thereof) arise
out of or are based upon (i) an untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement or any amendment or
supplement thereto or 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 or (ii) any untrue statement or alleged untrue statement
of a material fact contained in the Preliminary Prospectus or the Prospectus or
in any amendment or supplement thereto, or arise out of or are based upon any
omission or alleged omission to state therein a material fact necessary to make
the statements therein, in the light of the circumstances in which they were
made, not misleading, and will reimburse each Underwriter for any legal or other
expenses incurred by such Underwriter in connection with investigating,
preparing, pursuing or defending against or appearing as a third party witness
in connection with any such loss, damage, liability or action or claim,
including, without limitation, any investigation or proceeding by any
governmental agency or body, commenced or threatened, including the reasonable
fees and expenses of counsel to the indemnified party, as such expenses are
incurred (including such losses, damages, liabilities or expenses to the extent
of the aggregate amount paid in settlement of any such action or claim, provided
that (subject to Section 7(c) hereof) any such settlement is effected with the
written consent of the Partnership); PROVIDED, HOWEVER, that the MarkWest
Parties shall not be liable in any such case to the extent, but only to the
extent, that any such loss, damage or liability arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission
made in the Preliminary Prospectus, the Registration Statement, the Prospectus
or any other prospectus relating to the Units, or any such amendment or
supplement, in reliance upon and in conformity with written information relating
to the Underwriters furnished to the Partnership by you or by any Underwriter
through you, expressly for use in the preparation thereof (as provided in
Section 13 hereof); PROVIDED, FURTHER that with respect to any Preliminary
Prospectus, the foregoing indemnity in this Section 7(a) shall not inure to the
benefit of any Underwriter from whom the person asserting any loss, claim,
damage, liability, action or expense purchased Units, or any of its directors,
officers or employees or any person controlling such Underwriter, if copies of
the Prospectus were timely delivered to the Underwriter and a copy of the
Prospectus (as then amended or supplemented if the Partnership shall have
furnished any amendments or supplements thereto) was not sent or given by or on
behalf of such Underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the Units to
such person, and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage, liability, action or
expense.
In connection with the offer and sale of the Directed Units, the MarkWest
Parties, jointly and severally, agree, promptly upon a request in writing, to
indemnify and hold harmless ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. and the other Underwriters
from and against any loss, claim, damage, expense, liability or action which (i)
arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in any material prepared by or with the
approval of the MarkWest Parties for distribution to Directed Unit Participants
in connection
39
with the Directed Unit Program or any 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) arises out of the failure of any
Directed Unit Participant to pay for and accept delivery of Directed Units that
the Directed Unit Participant agreed to purchase or (iii) is otherwise related
to the Directed Unit Program, other than losses, claims, damages or liabilities
(or expenses relating thereto) that have resulted directly from the materials
prepared by ▇.▇. ▇▇▇▇▇▇▇ in connection with the Directed Unit Program or the bad
faith or gross negligence or willful misconduct of ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. or
the other Underwriters.
(b) Each Underwriter, severally and not jointly, will indemnify and hold
harmless the MarkWest Parties from and against any losses, damages or
liabilities to which the MarkWest Parties may become subject, under the 1933 Act
or otherwise, insofar as such losses, damages or liabilities (or actions or
claims in respect thereof) arise out of or are based upon (i) an untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment or supplement thereto, or arise out of
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, or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Prospectus or the Prospectus or in
any amendment or supplement thereto, or arise out of or are based upon any
omission or alleged omission to state therein a material fact necessary to make
the statements therein, in light of the circumstances in which they were made,
not misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission was
made in the Preliminary Prospectus, the Registration Statement, the Prospectus
or any such amendment or supplement, in reliance upon and in conformity with
written information relating to the Underwriters furnished to the Partnership by
you or by any Underwriter through you, expressly for use in the preparation
thereof (as provided in Section 13 hereof), and will reimburse the MarkWest
Parties for any legal or other expenses incurred by the MarkWest Parties in
connection with investigating or defending any such action or claim as such
expenses are incurred (including such losses, damages, liabilities or expenses
to the extent of the aggregate amount paid in settlement of any such action or
claim, provided that (subject to Section 7(c) hereof) any such settlement is
effected with the written consent of the Underwriters).
(c) Promptly after receipt by an indemnified party under Section 7(a) or
7(b) hereof of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against an indemnifying party
under Section 7(a) or 7(b) hereof, notify each such indemnifying party in
writing of the commencement thereof, but the failure so to notify such
indemnifying party shall not relieve such indemnifying party from any liability
except to the extent that it has been prejudiced in any material respect by such
failure or from any liability that it may have to any such indemnified party
otherwise than under Section 7(a) or 7(b) hereof. In case any such action shall
be brought against any such indemnified party and it shall notify each
indemnifying party of the commencement thereof, each such indemnifying party
shall be entitled to participate therein and, to the extent that it shall wish,
jointly with any other indemnifying party under Section 7(a) or 7(b) hereof
similarly notified, to assume the defense thereof, with counsel satisfactory to
such indemnified party (who shall not, except with the consent of such
indemnified party, be counsel to such indemnifying party), and, after notice
from such
40
indemnifying party to such indemnified party of its election so to assume the
defense thereof, such indemnifying party shall not be liable to such indemnified
party under Section 7(a) or 7(b) hereof for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. The indemnified party shall have the right to employ its own
counsel in any such action, but the fees and expenses of such counsel shall be
at the expense of such indemnified party unless (i) the employment of counsel by
such indemnified party at the expense of the indemnifying party has been
authorized by the indemnifying party, (ii) the indemnified party shall have been
advised by such counsel that there may be a conflict of interest between the
indemnifying party and the indemnified party in the conduct of the defense, or
certain aspects of the defense, of such action (in which case the indemnifying
party shall not have the right to direct the defense of such action with respect
to those matters or aspects of the defense on which a conflict exists or may
exist on behalf of the indemnified party) or (iii) the indemnifying party shall
not in fact have employed counsel reasonably satisfactory to such indemnified
party to assume the defense of such action, in any of which events such fees and
expenses to the extent applicable shall be borne, and shall be paid as incurred,
by the indemnifying party. If at any time such indemnified party shall have
requested such indemnifying party under Section 7(a) or 7(b) hereof to reimburse
such indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 7(a) or 7(b) hereof effected without its written consent if (i) such
settlement is entered into more than 60 days after receipt by such indemnifying
party of such request for reimbursement, (ii) such indemnifying party shall have
received notice of the terms of such settlement at least 45 days prior to such
settlement being entered into and (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request for
reimbursement prior to the date of such settlement. No such indemnifying party
shall, without the written consent of such indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not such
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (A) includes an unconditional
release of such indemnified party from all liability arising out of such action
or claim and (B) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any such indemnified party.
In no event shall such indemnifying parties be liable for the fees and expenses
of more than one counsel, including any local counsel, for all such indemnified
parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances.
(d) If the indemnification provided for in this Section 7 is unavailable
to or insufficient to indemnify or hold harmless an indemnified party under
Section 7(a) or 7(b) hereof in respect of any losses, damages or liabilities (or
actions or claims in respect thereof) referred to therein, then each
indemnifying party under Section 7(a) or 7(b) hereof shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
damages or liabilities (or actions or claims in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the
MarkWest Parties, on the one hand, and the Underwriters, on the other hand, from
the offering of the Units. If, however, the allocation provided by the
41
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under Section 7(c) hereof
and such indemnifying party was prejudiced in a material respect by such
failure, then each such indemnifying party shall contribute to such amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault, as
applicable, of the MarkWest Parties, on the one hand, and the Underwriters, on
the other hand, in connection with the statements or omissions that resulted in
such losses, damages or liabilities (or actions or claims in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by, as applicable, the MarkWest Parties, on the one hand, and the
Underwriters, on the other hand, shall be deemed to be in the same proportion as
the total net proceeds from such offering (before deducting expenses) received
by the Partnership bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault, as applicable, of the MarkWest
Parties, on the one hand, and the Underwriters, on the other hand, shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the MarkWest Parties, on the
one hand, or the Underwriters, on the other hand, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The MarkWest Parties and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by PRO RATA allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to above in this Section
7(d). The amount paid or payable by such an indemnified party as a result of the
losses, damages or liabilities (or actions or claims in respect thereof)
referred to above in this Section 7(d) shall be deemed to include any legal or
other expenses incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7(d), no Underwriter shall be required to contribute
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 that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation. The
obligations of the Underwriters in this Section 7(d) to contribute are several
in proportion to their respective underwriting obligations with respect to the
Units and not joint.
(e) The obligations of the MarkWest Parties under this Section 7 shall be
in addition to any liability that the MarkWest Parties may otherwise have and
shall extend, upon the same terms and conditions, to each officer, director,
employee, agent or other representative and to each person, if any, who controls
any Underwriter within the meaning of the 1933 Act; and the obligations of the
Underwriters under this Section 7 shall be in addition to any liability that the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each officer and director of the Partnership and the General
Partner who signed the Registration Statement and to each person, if any, who
controls the MarkWest Parties within the meaning of the 1933 Act.
42
8. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. The respective
representations, warranties, agreements and statements of the MarkWest Parties
and the Underwriters, as set forth in this Agreement or made by or on behalf of
them, respectively, pursuant to this Agreement, shall remain operative and in
full force and effect regardless of any investigation (or any statement as to
the results thereof) made by or on behalf of any Underwriter or any controlling
person of any Underwriter, the MarkWest Parties or any of its officers,
directors or any controlling persons and shall survive delivery of and payment
for the Units hereunder.
9. SUBSTITUTION OF UNDERWRITERS. (a) If any Underwriter shall default in
its obligation to purchase the Units which it has agreed to purchase hereunder,
you may in your discretion arrange for you or another party or other parties to
purchase such Units on the terms contained herein. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Units, then the Partnership shall be entitled to a further period of
thirty-six hours within which to procure another party or parties reasonably
satisfactory to you to purchase such Units on such terms. In the event that,
within the respective prescribed periods, you notify the Partnership that you
have so arranged for the purchase of such Units, or the Partnership notifies you
that it has so arranged for the purchase of such Units, you or the Partnership
shall have the right to postpone the Closing Date for a period of not more than
seven days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Partnership agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "UNDERWRITER" as used in this Agreement shall include
any persons substituted under this Section 9 with like effect as if such person
had originally been a party to this Agreement with respect to such Units.
(b) If, after giving effect to any arrangements for the purchase of the
Units of a defaulting Underwriter or Underwriters made by you and the
Partnership as provided in subsection (a) above, the aggregate number of Units
which remains unpurchased does not exceed one-eleventh of the total Units to be
sold on the Closing Date, then the Partnership shall have the right to require
each non-defaulting Underwriter to purchase the Units which such Underwriter
agreed to purchase hereunder and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Units which
such Underwriter agreed to purchase hereunder) of the Units of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Units of a defaulting Underwriter or Underwriters made by you and the
Partnership as provided in subsection (a) above, the number of Units which
remains unpurchased exceeds one-eleventh of the total Units to be sold on the
Closing Date, or if the Partnership shall not exercise the right described in
subsection (b) above to require the non-defaulting Underwriters to purchase
Units of the defaulting Underwriter or Underwriters, then this Agreement (or,
with respect to the Option Closing Date, the obligations of the Underwriters to
purchase and of the Partnership to sell the Option Units) shall thereupon
terminate, without liability on the part of any non-defaulting
43
Underwriter or the Partnership except for the expenses to be borne by the
Partnership and the Underwriters as provided in Section 11 hereof and the
indemnity and contribution agreements in Section 7 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. TERMINATION. (a) This Agreement may be terminated by you at any time
at or prior to the Closing Date by notice to the Partnership if any condition
specified in Section 6 hereof shall not have been satisfied on or prior to the
Closing Date. Any such termination shall be without liability of any party to
any other party except as provided in Sections 7 and 11 hereof.
(b) This Agreement also may be terminated by you, by notice to the
Partnership, as to any obligation of the Underwriters to purchase the Option
Units, if any condition specified in Section 6 hereof shall not have been
satisfied at or prior to the Option Closing Date or as provided in Section 9 of
this Agreement.
If you terminate this Agreement as provided in Sections 10(a) or 10(b), you
shall notify the Partnership by telephone or telegram, confirmed by letter.
11. COSTS AND EXPENSES. The Partnership will bear and pay the costs and
expenses incident to the registration of the Units and public offering thereof,
including, without limitation, (a) all expenses (including stock transfer taxes)
incurred in connection with the delivery to the several Underwriters of the
Units, the filing fees of the SEC, the fees and expenses of the Partnership's
counsel and accountants and the fees and expenses of counsel for the
Partnership, (b) the preparation, printing, filing, delivery and shipping of the
Registration Statement, each Preliminary Prospectus, the Prospectus and any
amendments or supplements thereto (except as otherwise expressly provided in
Section 5(d) hereof) and the printing, delivery and shipping of this Agreement
and other underwriting documents, including the Agreement Among Underwriters,
the Selected Dealer Agreement, Underwriters' Questionnaires and Powers of
Attorney and Blue Sky Memoranda, and any instruments or documents related to any
of the foregoing, (c) the furnishing of copies of such documents (except as
otherwise expressly provided in Section 5(d) hereof) to the Underwriters, (d)
the registration or qualification of the Units for offering and sale under the
securities laws of the various states and other jurisdictions, including the
fees and disbursements of counsel to the Underwriters relating to such
registration or qualification and in connection with preparing any Blue Sky
Memoranda or related analysis, (e) the filing fees of the NASD (if any) and fees
and disbursements of counsel to the Underwriters relating to any review of the
offering by the NASD, (f) all printing and engraving costs related to
preparation of the certificates for the Units, including transfer agent and
registrar fees, (g) all fees and expenses relating to the authorization of the
Units for trading on the American Stock Exchange; (h) all travel expenses,
including air fare and accommodation expenses, of representatives of the
Partnership in connection with the offering of the Units, and (i) all of the
other costs and expenses incident to the performance by the Partnership of the
registration and offering of the Units; provided, that (except as otherwise
provided in this Section 11) the Underwriters will bear and pay all of their own
costs and expenses, including the fees and expenses of the Underwriters'
counsel, the Underwriters' transportation expenses and any
44
advertising costs and expenses incurred by the Underwriters incident to the
public offering of the Units.
If this Agreement is terminated by you in accordance with the provisions of
Section 10(a) (other than pursuant to Section 9 or 6(k)), the Partnership shall
reimburse the Underwriters for all of their reasonable out-of-pocket expenses,
including the reasonable fees and disbursements of counsel to the Underwriters.
12. NOTICES. All notices or communications hereunder, except as herein
otherwise specifically provided, shall be in writing and if sent to the
Underwriters shall be mailed, delivered, sent by facsimile transmission, or
telegraphed and confirmed c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Managing Director,
Corporate Finance, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to ▇▇▇▇ ▇▇▇▇▇,
Attention: General Counsel, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, or if sent to the
Partnership shall be mailed, delivered, sent by facsimile transmission, or
telegraphed and confirmed to the Partnership at MarkWest Energy Partners, L.P.,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, facsimile number
(▇▇▇) ▇▇▇-▇▇▇▇. Notice to any Underwriter pursuant to Section 7 shall be mailed,
delivered, sent by facsimile transmission, or telegraphed and confirmed to such
Underwriter's address as it appears in the Underwriters' Questionnaire furnished
in connection with the offering of the Units or as otherwise furnished to the
Partnership.
13. INFORMATION FURNISHED BY UNDERWRITERS. The statements set forth in the
third, eleventh, twelfth, thirteenth, fourteenth, fifteenth, sixteenth,
eighteenth and nineteenth paragraphs and the third sentence of the seventh
paragraph under the caption "Underwriting" in the Prospectus constitute the only
information furnished by or on behalf of the Underwriters through you as such
information is referred to in Section 4(a)(ii) and Section 7 hereof.
14. PARTIES. This Agreement shall inure to the benefit of and be binding
upon the Underwriters, the MarkWest Parties and, to the extent provided in
Sections 7 and 8, the officers and directors of the General Partner and each
person who controls the Partnership or any Underwriter and their respective
heirs, executors, administrators, successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, corporation or other entity any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision herein contained;
this Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of the parties hereto and their
respective successors and assigns and said controlling persons and said officers
and directors, and for the benefit of no other person, corporation or other
entity. No purchaser of any of the Units from any Underwriter shall be construed
a successor or assign by reason merely of such purchase.
In all dealings hereunder, you shall act on behalf of each of the several
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of the Underwriters, made or
given by you jointly or by ▇.▇. ▇▇▇▇▇▇▇ &
45
Sons, Inc. on behalf of you as the Underwriters, as if the same shall have been
made or given in writing by the Underwriters.
15. COUNTERPARTS. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such counterparts shall together constitute one and the
same instrument.
16. PRONOUNS. Whenever a pronoun of any gender or number is used herein,
it shall, where appropriate, be deemed to include any other gender and number.
17. TIME OF ESSENCE. Time shall be of the essence of this Agreement.
18. APPLICABLE LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Missouri, without giving effect to the
choice of law or conflict of laws principles thereof.
46
If the foregoing is in accordance with your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among the MarkWest Parties and the
Underwriters.
MARKWEST HYDROCARBON, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
MARKWEST ENERGY OPERATING COMPANY, L.L.C.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
MARKWEST ENERGY GP, L.L.C.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
WEST SHORE PROCESSING COMPANY, L.L.C.
By: MarkWest Michigan, Inc., its Manager
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
MARKWEST ENERGY PARTNERS, L.P.
By: MarkWest Energy GP, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
BASIN PIPELINE, L.L.C.
By: MarkWest Michigan, Inc., its Manager
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
MARKWEST ENERGY APPALACHIA, L.L.C.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
MARKWEST MICHIGAN, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President and
Chief Financial Officer
Signature Page to Underwriting Agreement
Accepted in St. Louis,
Missouri as of the date
first above written, on
behalf of ourselves and each
of the several Underwriters
named in Schedule I hereto.
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
MCDONALD INVESTMENTS INC.
By: ▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Title: DIRECTOR - INVESTMENT BANKING
Signature Page to Underwriting Agreement
SCHEDULE I
Name Number of Units
---- ---------------
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. 840,000
RBC ▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. 840,000
McDonald Investments Inc. 420,000
---------
Total 2,100,000
=========
Schedule I
SCHEDULE II
Pursuant to Section 6(i) of the
Underwriting Agreement,
PricewaterhouseCoopers LLC shall furnish letters to the Underwriters to the
effect that:
(i) They are independent certified public accountants with respect
to the General Partners and the Partnership within the meaning of the 1933 Act
and the applicable Rules and Regulations thereunder.
(ii) In their opinion, the financial statements audited by them and
included in the Prospectus or the Registration Statement comply as to form in
all material respects with the applicable accounting requirements of the 1933
Act and the applicable Rules and Regulations with respect to registration
statements on Form S-1.
(iii) On the basis of limited procedures, not constituting an audit
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information referred to
below, performing the procedures specified by the AICPA for a review of interim
financial information as discussed in SAS No. 71, Interim Financial Information,
on the latest available interim financial statements of the Partnership
Entities, inspection of the minute books of the Partnership Entities since the
date of the latest audited financial statements included in the Prospectus,
inquiries of officials of the Partnership Entities responsible for financial and
accounting matters and such other inquiries and procedures as may be specified
in such letter, nothing came to their attention that caused them to believe
that:
(A) any material modifications should be made to the
unaudited statements of consolidated income, statements of
consolidated financial position and statements of consolidated cash
flows included in the Prospectus for them to be in conformity with
generally accepted accounting principles, or the unaudited statements
of consolidated income, statements of consolidated financial position
and statements of consolidated cash flows included in the Prospectus
do not comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the related published
Rules and Regulations thereunder.
(B) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
1933 Act and the published rules and regulations thereunder or the pro
forma adjustments have not been properly applied to the historical
amounts in the compilation of those statements.
(C) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock or any
increase in the consolidated long-term debt of the Partnership
Entities, or any decreases in consolidated working capital, net
current assets or net assets, or any changes in any other items
specified by the Underwriters, in each case as compared with amounts
shown in the latest balance sheet included in the Prospectus, except
in each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter.
(D) for the period from the date of the latest financial
statements included in the Prospectus to the specified date referred
to in Clause (C) there were any decreases in consolidated net revenues
or operating profit or the total or per share amounts of consolidated
net income or any changes in any other items specified by the
Underwriters, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding length
specified by the Underwriters, except in each case for changes,
decreases or increases which the Prospectus discloses have occurred or
may occur or which are described in such letter.
(iv) In addition to the audit referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraph (iii) above, they
have carried out certain specified procedures, not constituting an audit in
accordance with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the Underwriters,
which are derived from the general accounting records of the Partnership
Entities for the periods covered by their reports and any interim or other
periods since the latest period covered by their reports, which appear in the
Prospectus, or in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Underwriters, and have compared certain of such
amounts, percentages and financial information with the accounting records of
the Partnership Entities and have found them to be in agreement.
Schedule II-2