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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): September 29, 1999
EOTT ENERGY PARTNERS, L.P.
(Exact name of registrant as specified in its charter)
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DELAWARE 1-12872 76-04245200
(State of Incorporation or Organization) (Commission File Number) (I.R.S. Employer
Identification Number)
1330 Post Oak Boulevard,
SUITE 2700
Houston, Texas 77056
(Address of principal executive offices) (Zip Code)
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Registrant's telephone number, including area code: (713) 993-5200
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ITEM 7. Financial Statements and Exhibits
(c) The following exhibits are filed herewith:
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Exhibit Description of Exhibit
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1.1 Underwriting Agreement, dated September 23, 1999, by and among EOTT
Energy Partners, L.P., EOTT Energy Finance Corp., EOTT Energy Corp.,
EOTT Energy Operating Limited Partnership, EOTT Energy Pipeline
Limited Partnership, EOTT Energy Canada Limited Partnership and the
underwriters named therein.
3.1 Amendment No. 6 dated as of September 16, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Partners,
L.P.
3.2 Amendment No. 1 dated as of September 1, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Operating
Limited Partnership.
3.3 Amendment No. 1 dated as of September 1, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Pipeline
Limited Partnership.
3.4 Amendment No. 1 dated as of September 1, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Canada
Limited Partnership.
12.1 Computation of Ratio of Earnings to Fixed Charges
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: September 29, 1999
EOTT ENERGY PARTNERS, L.P.
(A Delaware Limited Partnership)
By: EOTT ENERGY CORP. as
General Partner
By: /s/ Lori L. Maddox
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Name: Lori L. Maddox
Title: Controller
(Principal Accounting
Officer)
3
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EXHIBIT INDEX
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Exhibit Description of Exhibit
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1.1 Underwriting Agreement, dated September 23, 1999, by and among EOTT
Energy Partners, L.P., EOTT Energy Finance Corp., EOTT Energy Corp.,
EOTT Energy Operating Limited Partnership, EOTT Energy Pipeline
Limited Partnership, EOTT Energy Canada Limited Partnership and the
underwriters named therein.
3.1 Amendment No. 6 dated as of September 16, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Partners,
L.P.
3.2 Amendment No. 1 dated as of September 1, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Operating
Limited Partnership.
3.3 Amendment No. 1 dated as of September 1, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Pipeline
Limited Partnership.
3.4 Amendment No. 1 dated as of September 1, 1999, to the Amended and
Restated Agreement of Limited Partnership of EOTT Energy Canada
Limited Partnership.
12.1 Computation of Ratio of Earnings to Fixed Charges
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EXHIBIT 1.1
3,500,000 Common Units
Representing Limited Partner Interests
EOTT Energy Partners, L.P.
UNDERWRITING AGREEMENT
September 23, 1999
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER INCORPORATED
ING BARINGS LLC
c/o PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Ladies and Gentlemen:
EOTT Energy Partners, L.P., a Delaware limited partnership (the
"Partnership"), proposes to sell common units representing limited partner
interests in the Partnership (the "Common Units") to PaineWebber Incorporated,
Lehman Brothers Inc., Dain Rauscher Wessels, a division of Dain Rauscher
Incorporated and ING Barings LLC (the "Underwriters") in an aggregate amount of
3,500,000 Common Units (the "Firm Units"). The Partnership has also agreed to
grant to the Underwriters an option (the "Option") to purchase up to additional
525,000 Common Units representing limited partner interests (the "Option Units")
on the terms and for the purposes set forth in Section 1(b). The Firm Units and
the Option Units are hereinafter referred to as the "Units."
The public offering price per Common Unit for the Units and the
purchase price per Common Unit for the Units to be paid by the Underwriters
shall be agreed upon by the Partnership and the Underwriters, and such agreement
shall be set forth in a separate written instrument substantially in the form of
Exhibit A hereto (the "Price Determination Agreement"). The Price Determination
Agreement may take the form of an exchange of any standard form of written
telecommunication among the Partnership and the Underwriters and shall specify
such applicable information as is indicated in Exhibit A hereto. The offering of
the Units will be governed by this Agreement, as supplemented by the Price
Determination Agreement. From and after the date of the execution and delivery
of the Price Determination Agreement, this Agreement shall be deemed to
incorporate, and, unless the context otherwise indicates, all references
contained herein to "this Agreement" and to the phrase "herein" shall be deemed
to
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include the Price Determination Agreement.
Each of (i) the Partnership, (ii) EOTT Energy Corp., a Delaware
corporation (both in its capacity as general partner of the Partnership and the
Operating Partnerships and in its individual capacity, the "General Partner"),
(iii) EOTT Energy Finance Corp. ("Finance Sub"), (iv) EOTT Energy Operating
Limited Partnership, a Delaware limited partnership ("Energy OLP"), (v) EOTT
Energy Pipeline Limited Partnership, a Delaware limited partnership ("Pipeline
OLP") and (vi) EOTT Energy Canada Limited Partnership, a Delaware limited
partnership ("Canada OLP" and, together with Energy OLP and Pipeline OLP, the
"Operating Partnerships") confirms as follows its agreements with the
Underwriters. All of such entities shall be referred to collectively as the
"EOTT Entities."
1. Agreement to Sell and Purchase.
(a) On the basis of the representations, warranties and
agreements of the EOTT Entities herein contained and subject to all the terms
and conditions of this Agreement, the Partnership agrees to sell to each
Underwriter, and each Underwriter, severally and not jointly, agrees to purchase
from the Partnership, at the purchase price per Common Unit for the Units to be
agreed upon by the Underwriters and the Partnership in accordance with Section
1(c) hereof and set forth in the Price Determination Agreement, the number of
Firm Units set forth opposite the name of such Underwriter in Schedule I, plus
such additional number of Firm Units which such Underwriter may become obligated
to purchase pursuant to Section 8 hereof. Schedule I may be attached to the
Price Determination Agreement.
(b) Subject to all the terms and conditions of this Agreement,
the Partnership grants the Option to the several Underwriters to purchase,
severally and not jointly, up to 525,000 Option Units from the Partnership at
the same price per Common Unit as the Underwriters shall pay for the Firm Units.
The Option may be exercised only to cover over-allotments in the sale of the
Firm Units by the Underwriters and may be exercised in whole or in part at any
time (but not more than once) on or before the 30th day after the date of the
Price Determination Agreement, upon written or telegraphic notice (the "Option
Units Notice") by the Underwriters to the Partnership no later than 12:00 noon,
New York City time, at least two and no more than five business days before the
date specified for closing in the Option Units Notice (the "Option Closing
Date") setting forth the aggregate number of Option Units to be purchased and
the time and date for such purchase. On the Option Closing Date, the Partnership
will issue and sell to the Underwriters the number of Option Units set forth in
the Option Units Notice, and each Underwriter will purchase the percentage of
the Option Units as is equal to the percentage of Firm Units that such
Underwriter is purchasing, as adjusted by the Underwriters in such manner as
they deem advisable to avoid fractional Common Units.
(c) The public offering price per Common Unit for the Firm
Units and the purchase price per Common Unit for the Firm Units to be paid by
the several Underwriters shall be agreed upon and set forth in the Price
Determination Agreement.
2. Delivery and Payment. The Firm Units to be purchased by each
Underwriter
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hereunder, in book entry form, and in such authorized denominations and
registered in such names as PaineWebber Incorporated may request, will be
represented by one or more definitive global certificates which will be
deposited by or on behalf of the Partnership with the Depository Trust Company
("DTC")or its designated custodian. Delivery to the Underwriters of the Firm
Units shall be made by or on behalf of the Partnership by causing DTC to credit
the Firm Units to the account or accounts designated by PaineWebber Incorporated
at DTC, against payment of the purchase price by wire transfer of Federal Funds
or similar same day funds to an account designated in writing by the Partnership
to PaineWebber Incorporated at least one business day prior to the Closing Date
(as hereinafter defined). Such payment shall be made at 10:00 a.m., New York
City time, on the third business day (or fourth business day, if the Price
Determination Agreement is executed after 4:30 p.m.) after the date on which the
first bona fide offering of the Units to the public is made by the Underwriters
or at such time on such other date, not later than ten business days after such
date, as may be agreed upon by the Partnership and the Underwriters (such date
is hereinafter referred to as the "Closing Date").
To the extent the Option is exercised, delivery of the Option Units
against payment by the Underwriters (in the manner specified above) will take
place at the offices specified above for the Closing Date at the time and date
(which may be the Closing Date) specified in the Option Units Notice.
The cost of original issue tax stamps, if any, in connection with the
issuance and delivery of the Units by the Partnership to the respective
Underwriters shall be borne by the Partnership. The Partnership will pay and
save each Underwriter and any subsequent holder of the Units harmless from any
and all liabilities with respect to or resulting from any failure or delay in
paying Federal and state stamp and other transfer taxes, if any, which may be
payable or determined to be payable in connection with the original issuance or
sale to such Underwriter of the Firm Units and Option Units.
3. Representations and Warranties of the EOTT Entities. Each of the
EOTT Entities represents, warrants and covenants to each Underwriter that:
(a) The Partnership meets the requirements for use of Form S-3
and a registration statement (Registration No. 333-82269) on Form S-3 relating
to the Units (and such amendments to such registration statement as may have
been required to the date of this Agreement) has been prepared by the
Partnership in accordance with the requirements of the Securities Act of 1933,
as amended (the "Act"), and the rules and regulations (collectively referred to
as the "Rules and Regulations") of the Securities and Exchange Commission (the
"Commission")thereunder, and has been filed with the Commission. Such
registration statement has been declared effective by the Commission. Copies of
such registration statement and amendments and of each related prospectus have
been delivered to the Underwriters. The term "Registration Statement" means the
registration statement, including all financial statements, exhibits and
documents incorporated by reference therein, as from time to time amended or
supplemented pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), Rule 415 and Rule 434 of the Rules and Regulations, or
otherwise, any registration statement filed under Rule 462 of the Rules and
Regulations as such registration statement may
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be amended from time to time and all information contained in the final
prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations. The term "Prospectus" means the prospectus constituting a part of
the Registration Statement and any amendments or supplements to such prospectus,
including without limitation the prospectus supplement filed with the Commission
in connection with the proposed sale of Units contemplated by this Agreement
(the "Prospectus Supplement"), through the date of such Prospectus Supplement.
Any reference herein to the Registration Statement or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Exchange Act, on or
before the date hereof or are so filed hereafter. Any reference herein to the
terms "amend," "amendment" or "supplement" with respect to the Registration
Statement or the Prospectus shall be deemed to refer to and include any such
document filed or to be filed under the Exchange Act after the date of the
Prospectus, and deemed to be incorporated therein by reference.
(b) On the date the Registration Statement was declared
effective by the Commission (the "Effective Date"), at all times subsequent to
and including the Closing Date and, if later, the Option Closing Date and when
any post-effective amendment to the Registration Statement becomes effective or
any amendment or supplement to the Prospectus is filed with the Commission, the
Registration Statement and the Prospectus (as amended or as supplemented if the
Partnership shall have filed with the Commission any amendment or supplement
thereto), including the financial statements included or incorporated by
reference in the Prospectus or the Registration Statement, did or will comply
with all applicable provisions of the Act, the Exchange Act, the rules and
regulations thereunder (the "Exchange Act Rules and Regulations") and the Rules
and Regulations and will contain all statements required to be stated therein in
accordance with the Act, the Exchange Act, the Exchange Act Rules and
Regulations and the Rules and Regulations. On the Effective Date and when any
post-effective amendment to the Registration Statement becomes effective, no
part of the Registration Statement or any such amendment did or will contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein not
misleading. At the Effective Date, the date the Prospectus or any amendment or
supplement to the Prospectus is filed with the Commission and at the Closing
Date and, if later, the Option Closing Date, the Prospectus did not or will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The foregoing representations and
warranties in this Section 3(b) do not apply to any statements or omissions made
in reliance on and in conformity with information relating to any Underwriter
furnished in writing to the Partnership by the Underwriters specifically for
inclusion in the Registration Statement or Prospectus or any amendment or
supplement thereto. For all purposes of this Agreement (i) the amounts of the
selling concession and reallowance set forth in the Prospectus (ii) the
paragraph regarding stabilization in the section captioned "Underwriting"in the
Prospectus, and (iii) the number of Common Units to be purchased by each
Underwriter set forth in the section captioned "Underwriting" in the Prospectus
constitute the only information relating to any Underwriter furnished in writing
to the Partnership by the Underwriters specifically for inclusion in the
Registration Statement or the Prospectus. The Partnership has not distributed
any offering material in connection with the offering or sale of the Units other
than the Registration Statement
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and the Prospectus. No order preventing or suspending the use of the Prospectus
has been issued by the Commission.
(c) The documents which are incorporated by reference in the
Registration Statement and the Prospectus or from which information is so
incorporated by reference, when they became effective or were filed with the
Commission, as the case may be, complied in all material respects with the
requirements of the Act or the Exchange Act, as applicable, the Exchange Act
Rules and Regulations and the Rules and Regulations and none of such documents
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 statement therein
not misleading; and any further documents so filed and incorporated by reference
subsequent to the Closing Date shall, when they are filed with the Commission,
conform in all material respects with the requirements of the Act and the
Exchange Act, as applicable, the Exchange Act Rules and Regulations and the
Rules and Regulations and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statement therein not misleading.
(d) The only subsidiaries (as defined in the Rules and
Regulations) of the Partnership are the Operating Partnerships and the Finance
Sub. Each of the Partnership and the Operating Partnerships was duly formed and
is validly existing and in good standing under the Delaware Revised Uniform
Limited Partnership Act (the "Delaware Act"). Each of the Partnership and the
Operating Partnerships has, and at the Closing Date will have, full power and
authority to conduct the activities conducted by it, to own or lease all the
assets owned or leased by it and to conduct its business in all material
respects as described in the Registration Statement and the Prospectus. Each of
the Partnership and the Operating Partnerships is, and at the Closing Date will
be, duly licensed or qualified to do business and in good standing as a foreign
limited partnership in all jurisdictions in which the failure so to qualify or
register would have a material adverse effect upon it or subject it to any
material liability or disability. All of the outstanding shares of capital stock
of the Finance Sub have been duly authorized and validly issued and are fully
paid and nonassessable and are owned by the Partnership free and clear of all
liens and encumbrances and claims whatsoever. The Partnership is the sole
limited partner of Energy OLP, and Energy OLP is the sole limited partner of
Pipeline OLP and Canada OLP, in each case with a limited partner interest of
99.0%. Such limited partner interests have been duly authorized by the
respective Amended and Restated Agreements of Limited Partnership of the
Operating Partnerships (the "Operating Partnership Agreements"), have been
validly issued in accordance with the respective Operating Partnership
Agreements and are fully paid and non-assessable, except to the extent such
non-assessability may be affected by Section 17-607 of the Delaware Revised
Uniform Limited Partnership Act, as amended. The Partnership owns such limited
partner interests free and clear of all liens, encumbrances, security interests,
equities, charges or claims, except for such liens, encumbrances, security
interests, equities, charges or claims as are not, individually or in the
aggregate, material or except as described in the Prospectus. Except for such
limited partner interests and the stock of the Finance Sub, the Partnership does
not own, and at the Closing Date will not own, directly or indirectly, any
shares of stock or any other equity or long-term debt securities of any
corporation or have an equity interest in any firm, partnership, joint venture,
association or other entity. Complete and correct
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copies of the Amended and Restated Agreement of Limited Partnership of the
Partnership (the "Partnership Agreement") and each of the Operating Partnership
Agreements have been delivered to the Underwriters, and no changes therein will
be made subsequent to the date hereof and prior to the Closing Date.
(e) The limited partners of the Partnership hold limited
partner interests in the Partnership aggregating 99%, such limited partner
interests being represented by 14,976,011 Common Units and 9,000,000 units
representing subordinated limited partner interests ("Subordinated Units")(the
Common Units and the Subordinated Units are collectively referred to as the
"Limited Partner Units"); the Limited Partner Units are the only limited partner
interests of the Partnership that are issued and outstanding; the Limited
Partner Units have been, and the Common Units to be issued and sold by the
Partnership will be, duly authorized and validly issued under the Partnership
Agreement, fully paid and nonassessable, except as such nonassessability may be
affected by Section 17-607 of the Delaware Revised Uniform Limited Partnership
Act, as amended, and will not be subject to any preemptive or similar right or
voting or transfer restriction. The description of the Common Units in the
Registration Statement and the Prospectus is, and at the Closing Date will be,
complete and accurate in all material respects. Except as set forth in the
Prospectus, the Partnership does not have outstanding, and at the Closing Date
will not have outstanding, any options to purchase, or any rights or warrants to
subscribe for, or any securities or obligations convertible into, or any
contracts or commitments to issue or sell, any limited partner interests or
shares of stock in the Partnership, the Operating Partnerships, or the Finance
Sub pursuant to the Partnership Agreement, the Operating Partnership Agreements,
any certificate of incorporation or other governing documents or any agreement
or other instrument to which any of the EOTT entities is a party or by which any
of them may be bound.
(f) Each of the General Partner and the Finance Sub is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. Each of the General Partner and the Finance Sub has,
and at the Closing Date will have, full power and authority to conduct all the
activities conducted by it, to own or lease all the assets owned or leased by it
and to conduct its business in all material respects as described in the
Registration Statement and the Prospectus. Each of the General Partner and the
Finance Sub is, and at the Closing Date will be, duly licensed or qualified to
do business and in good standing as a foreign corporation in all jurisdictions
in which the failure so to qualify or register would have a material adverse
effect upon it or subject it to any material liability or disability. The
General Partner is the sole general partner of the Partnership and the Operating
Partnerships, in each case with a general partner interest of 1%. Such general
partner interests have been duly authorized by the Partnership Agreement and the
respective Operating Partnership Agreements, have been validly issued in
accordance with the Partnership Agreement and the respective Operating
Partnership Agreements, and are owned of record by the General Partner, free and
clear of all liens, encumbrances, security interests, equities, charges or
claims, except for such liens, encumbrances, security interests, equities,
charges or claims as are not, individually or in the aggregate, material or
except as described in the Prospectus. Complete and correct copies of the
certificate of incorporation and the by-laws of the General Partner and the
Finance Sub and all amendments thereto have been delivered to the Underwriters,
and no changes therein will be
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made subsequent to the date hereof and prior to the Closing Date.
(g) The financial statements and schedules included or
incorporated by reference in the Registration Statement or the Prospectus
present fairly the consolidated financial condition of the Partnership as of the
respective dates thereof and the consolidated results of operations and cash
flows of the Partnership for the respective periods covered thereby, all in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the entire period involved, except as otherwise disclosed
therein or in the Prospectus. No other financial statements or schedules are
required by the Act, the Exchange Act or the Rules and Regulations to be
included in the Registration Statement or the Prospectus. Arthur Andersen L.L.P.
(the "Accountants"), who have reported on such financial statements and
schedules, are independent accountants with respect to the EOTT Entities, as
required by the Act and the Rules and Regulations. The statements included in
the Registration Statement with respect to the Accountants pursuant to Rule 509
of Regulation S-K of the Rules and Regulations are true and correct in all
material respects.
(h) The Partnership maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(i) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus and prior to the
Closing Date, except as set forth in or contemplated by the Registration
Statement and the Prospectus, (i) there has not been and will not have been any
change in the capitalization of the EOTT Entities, or in the business,
properties, business prospects, condition (financial or otherwise) or results of
operations of the EOTT Entities, arising for any reason whatsoever, (ii) none of
the EOTT Entities has incurred nor will it incur any material liabilities or
obligations, direct or contingent, nor has it entered into nor will it enter
into any material transactions other than pursuant to this Agreement and the
transactions referred to herein, other than the issuance of $235.0 million of
senior notes due 2009 and (iii) none of the EOTT Entities has sustained any
material loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus.
(j) None of the EOTT Entities is, nor at the Closing Date will
be, an "investment company"or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company" as that term is defined in
the Investment Company Act of 1940, as amended (the "Investment Company Act"),
and the rules and regulations thereunder.
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(k) None of the EOTT Entities is, nor at the Closing Date will
be, a "public utility company,"a "holding company"or an "affiliate" of a holding
company or a public utility company within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
(l) Except as set forth in the Registration Statement and the
Prospectus, there are no actions, suits or proceedings pending or threatened
against or affecting any of the EOTT Entities or any of their respective
officers in their capacity as such, before or by any Federal or state court,
commission, regulatory body, administrative agency or other governmental body,
domestic or foreign, wherein an unfavorable ruling, decision or finding might
materially and adversely affect any of the EOTT Entities or its business,
properties, business prospects, condition (financial or otherwise) or results of
operations.
(m) Each of the EOTT Entities has, and at the Closing Date
will have, (i) all governmental licenses, permits, consents, orders, approvals
and other authorizations necessary to carry on its business as contemplated in
the Prospectus except for such certificates, permits or authorizations which, if
not obtained, would not reasonably be expected to have, individually or in the
aggregate, a material adverse effect upon the ability of the EOTT Entities to
conduct their businesses in all material respects as currently conducted and as
contemplated in the Prospectus to be conducted; and, except as described in the
Prospectus, none of the EOTT Entities has received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization or permit which, individually or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would be expected to have a
material adverse effect upon the ability of any of the EOTT Entities to conduct
their businesses in all material respects as currently conducted and as
contemplated by the Prospectus to be conducted, (ii) complied in all material
respects with all laws, regulations and orders applicable to it or its business
and (iii) performed in all material respects all its obligations required to be
performed by it, and is not, and at the Closing Date will not be, in default,
under any indenture, mortgage, deed of trust, voting trust agreement, loan
agreement, bond, debenture, note agreement, lease, contract or other agreement
or instrument (collectively, a "contract or other agreement") to which it is a
party or by which its property is bound or affected which default, individually
or in the aggregate, could have a material adverse effect on the holders of the
Common Units or the consolidated financial position or results of operations or
prospects of any of the EOTT Entities. To the best knowledge of each of the EOTT
Entities, no other party under any contract or other agreement to which it is a
party is in default in any respect thereunder. None of the EOTT Entities is, nor
at the Closing Date will any of them be, in violation of any provision of its
limited partnership agreement, certificate of incorporation or by-laws.
(n) No consent, approval, authorization or order of, or any
filing or declaration with, any court or governmental agency or body is required
in connection with the authorization, issuance, transfer, sale or delivery of
the Units by the Partnership, in connection with the execution, delivery and
performance of this Agreement by any of the EOTT Entities or in connection with
the taking by any of the EOTT Entities of any action contemplated hereby, except
such as have been obtained under the Act or the Rules and Regulations and such
as may be required under state securities or Blue Sky laws.
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(o) Each of the EOTT Entities has full corporate and
partnership power and authority to enter into this Agreement. This Agreement has
been duly authorized, executed and delivered by each of the EOTT Entities and
constitutes a valid and binding agreement of each of the EOTT Entities and is
enforceable against each of the EOTT Entities in accordance with the terms
hereof. The performance of this Agreement, the consummation of the transactions
contemplated hereby and the application of the net proceeds from the offering
and sale of the Units in the manner set forth in the Prospectus under "Use of
Proceeds"will not result in the creation or imposition of any lien, charge or
encumbrance upon any of the assets of any of the EOTT Entities pursuant to the
terms or provisions of, result in a breach or violation of any of the terms or
provisions of, constitute a default under, give any other party a right to
terminate any of its obligations under or result in the acceleration of any
obligation under, the limited partnership agreement or certificate of
incorporation or by-laws of any of the EOTT Entities, any indenture, mortgage,
deed of trust, loan agreement, contract or other agreement or instrument to
which any of the EOTT Entities is a party or by which any of the EOTT Entities
or any of its properties is bound or affected, or violate or conflict with any
judgment, ruling, decree, order, statute, rule or regulation of any court or
other governmental agency or body applicable to the business or properties of
any of the EOTT Entities.
(p) Each of the Partnership, the Operating Partnerships and
the General Partner has good and indefeasible title to all real and personal
property owned by it, free and clear of all liens, claims, encumbrances and
defects except (1) as described in the Prospectus and (2) such as do not
materially interfere with the use of such properties as they have been used in
the past and are proposed to be used in the future as described in the
Prospectus, provided that (a) with respect to the crude oil transmission
pipelines and right-of-way interests thereto (the "Pipeline Properties"), the
foregoing shall only constitute a representation that, except as described in
the Prospectus, (i) Pipeline OLP will have sufficient title to enable it to use
such Pipeline Properties as they have been used in the past and are proposed to
be used in the future as described in the Prospectus, and (ii) any lack of title
has not had and will not have any material adverse effect on the ability of
Pipeline OLP to use such Pipeline Properties as they have been used in the past
and are proposed to be used in the future as described in the Prospectus and
will not materially increase the cost of such use, and (b) with respect to any
real property, buildings and equipment held under lease by the Partnership, the
Operating Partnerships, or the General Partner, such real property, buildings
and equipment are held by such person under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere with the
use made and proposed to be made of such real property, buildings and equipment
by such person;
(q) There is no document or contract of a character required
to be described in the Registration Statement or the Prospectus or to be filed
as an exhibit to the Registration Statement which is not described or filed as
required.
(r) None of the EOTT Entities, nor any of their directors,
officers or controlling persons has taken, directly or indirectly, any action
intended, or which might reasonably be expected, to cause or result, under the
Act or otherwise, in, or which has constituted, stabilization or manipulation of
the price of any security of the Partnership to facilitate the sale or resale of
the Units.
<PAGE> 10
(s) No holder of securities of the Partnership has rights to
the registration of any securities of the Partnership because of the filing of
the Registration Statement that have not been waived.
(t) The Common Units (including the Units to be sold pursuant
to this Agreement) are duly authorized for listing, subject to official notice
of issuance, on the New York Stock Exchange.
(u) Each of the EOTT Entities is in compliance with all
federal, state and local employment and labor laws, including, but not limited
to, laws relating to non-discrimination in hiring, promotion and pay of
employees; no labor dispute with the employees of any of the EOTT Entities
exists or, to the knowledge of any of the EOTT Entities, is imminent or
threatened; and each of the EOTT Entities is not aware of any existing, imminent
or threatened labor disturbance by the employees of any of its principal
suppliers, manufacturers or contractors that could result in a material adverse
effect on the condition (financial or otherwise) or on the earnings, business,
properties, business prospects or operations of the EOTT Entities, taken as a
whole.
(v) Each of the EOTT Entities owns, or is licensed or
otherwise has the full exclusive right to use, the material patents, patent
rights, licenses, inventions, copyrights, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, services marks and trade names
(collectively, "patent and proprietary rights") presently employed by it or
which are necessary in connection with the conduct of the business now operated
by it, and none of the EOTT Entities has received any written notice or
otherwise has actual knowledge of any infringement of or conflict with asserted
rights of others or any other claims with respect to any patent or proprietary
rights, or of any basis for rendering any patent and proprietary rights invalid
or inadequate to protect the interest of any of the EOTT Entities.
(w) The Partnership has complied, and until the completion of
the distribution of the Units will comply, with all of the provisions of
(including, without limitation, filing all forms required by) Section 517.075 of
the Florida Securities and Investor Protection Act and Regulation 3E-900.001
issued thereunder with respect to the offering and sale of the Units.
(x) Each of the EOTT Entities (i) is in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
imposing liability or standards of conduct concerning any Hazardous Material (as
hereinafter defined) ("Environmental Laws"), (ii) has received all permits,
licenses or other approvals required of it under Environmental Laws to conduct
its business and (iii) is in compliance with all terms and conditions of any
such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals would not, individually or in the aggregate result in a
material adverse effect on the condition (financial or otherwise) or on the
earnings, business, properties, business prospects or operations of the EOTT
Entities, taken as a whole. The term
<PAGE> 11
"Hazardous Material" means (A) any "hazardous substance" as defined by the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended, (B) any "hazardous waste" as defined by the Resource Conservation
and Recovery Act, as amended, (C) any petroleum or petroleum product, (D) any
polychlorinated biphenyl and (E) any pollutant or contaminant or hazardous,
dangerous, or toxic chemical, material, waste or substance regulated under or
within the meaning of any other Environmental Law.
(y) In the ordinary course of its business, the Partnership
conducts a periodic review of the effect of Environmental Laws on the business,
operations and properties of each of the EOTT Entities, in the course of which
it identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties (collectively, "Environmental Liabilities")).
Except as set forth in the Registration Statement and the Prospectus, there are
no Environmental Liabilities which would, singly or in the aggregate, have a
material adverse effect on the condition (financial or otherwise) or on the
earnings, business, properties, business prospects or operations of the EOTT
Entities, taken as a whole.
(z) Each of the EOTT Entities maintains insurance with respect
to its properties and business of the types and in amounts generally deemed
adequate for its business and consistent with insurance coverage maintained by
similar companies and businesses, all of which insurance is in full force and
effect.
(aa) Each of the EOTT Entities has filed all material federal,
state and foreign income and franchise tax returns and has paid all taxes shown
as due thereon, other than taxes which are being contested in good faith and for
which adequate reserves have been established in accordance with generally
accepted accounting principles ("GAAP"); and none of the EOTT Entities has any
knowledge of any tax deficiency which has been or might be asserted or
threatened against any of the EOTT Entities. There are no tax returns of any of
the EOTT Entities that are currently being audited by state, local or federal
taxing authorities or agencies (and with respect to which any of the EOTT
Entities has received notice), where the findings of such audit, if adversely
determined, would result in a material adverse effect on the condition
(financial or otherwise) or on the earnings, business, properties, business
prospects or operations of the EOTT Entities, taken as a whole.
(bb) With respect to each employee benefit plan, program and
arrangement (including, without limitation, any "employee benefit plan"as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) maintained or contributed to by any of the EOTT Entities,
or with respect to which any of the EOTT Entities could incur any liability
under ERISA (collectively, the "Benefit Plans"), no event has occurred and, to
the best knowledge of each of the EOTT Entities, there exists no condition or
set of circumstances, in connection with which any of the EOTT Entities could be
subject to any liability under the terms of such Benefit Plan, applicable law
(including, without limitation, ERISA and the Internal Revenue Code of 1986, as
amended) or any applicable agreement that
<PAGE> 12
could materially adversely affect the business, properties, business prospects,
condition (financial or otherwise) or results of operations of the EOTT
Entities, taken as a whole.
(cc) Each of the EOTT Entities has reviewed its operations
and those of any third parties with which the EOTT Entities have a material
relationship to evaluate the extent to which the business or operations of the
EOTT Entities will be affected by the Year 2000 Problem. As a result of such
review, the EOTT Entities have no reason to believe, and do not believe, that
(other than as described in the Prospectus) the Year 2000 Problem will have a
material adverse effect on the general affairs, management, the current or
future consolidated financial position, partners' capital or results of
operations of the EOTT Entities or result in any material loss or interference
with any of the EOTT Entities' business or operations. The "Year 2000 Problem"as
used herein means any significant risk that computer hardware or software used
in the receipt, transmission, processing, manipulation, storage, retrieval,
retransmission or other utilization of data or in the operation of mechanical or
electrical systems of any kind will not, in the case of dates or time periods
occurring after December 31, 1999, function at least as effectively as in the
case of dates or time periods occurring prior to January 1, 2000.
(dd) (i) The Partnership Agreement is a valid and legally
binding agreement of the General Partner, enforceable against the General
Partner in accordance with its terms and (ii) each of the Operating Partnership
Agreements is a valid and legally binding agreement of such parties, enforceable
against the General Partner and the Partnership in accordance with its terms,
except as the enforceability of such agreements may be affected by bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and general equitable principles.
(ee) Pursuant to Rule 2710(b)(7)(C)(i) of the Conduct Rules
of the National Association of Securities Dealers, Inc., as of the date hereof
and as of the Closing Date, the Partnership meets, and will meet, the standards
for use of Form S-3 as in effect prior to October 21, 1992.
4. Agreements of the EOTT Entities. The EOTT Entities agree with the
several Underwriters as follows:
(a) The Partnership will not, either prior to the Closing Date
or thereafter, during such period as the Prospectus is required by law to be
delivered in connection with sales of the Units by an Underwriter or any dealer,
file any amendment or supplement to the Registration Statement or the
Prospectus, unless a copy thereof shall first have been submitted to the
Underwriters within a reasonable period of time prior to the filing thereof and
the Underwriters shall not have objected thereto in good faith.
(b) The Partnership will notify the Underwriters promptly, and
will confirm such advice in writing, (1) when any post-effective amendment to
the Registration Statement becomes effective, (2) of any request by the
Commission for amendments or supplements to the Registration Statement or the
Prospectus or for additional information, (3) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or
the initiation of any proceedings for that purpose or the threat thereof, (4) of
the happening of any event during the period mentioned in the second sentence of
Section 4(e) that in the judgment of the Partnership makes any statement made in
the Registration Statement or the
<PAGE> 13
Prospectus untrue or that requires the making of any changes in the Registration
Statement or the Prospectus in order to make the statements therein, in light of
the circumstances under which they were made, not misleading and (5) of receipt
by the Partnership or any representative or attorney of the Partnership of any
other communication from the Commission relating to the Partnership , the
Registration Statement or the Prospectus. If at any time the Commission shall
issue any order suspending the effectiveness of the Registration Statement, the
Partnership will make every reasonable effort to obtain the withdrawal of such
order at the earliest possible moment.
(c) The Partnership will furnish to the Underwriters, without
charge, two signed copies of the Registration Statement and of any
post-effective amendment thereto, including financial statements and schedules,
and all exhibits thereto (including any document filed under the Exchange Act
and deemed to be incorporated by reference into the Prospectus).
(d) The Partnership will comply with all the provisions of any
undertakings contained in the Registration Statement.
(e) The Partnership will deliver to each of the Underwriters,
without charge, as many copies of the Prospectus or any amendment or supplement
thereto as the Underwriters may reasonably request. The Partnership consents to
the use of the Prospectus or any amendment or supplement thereto by the several
Underwriters and by all dealers to whom the Units may be sold, both in
connection with the offering or sale of the Units and for any period of time
thereafter during which the Prospectus is required by law to be delivered in
connection therewith. If during such period of time any event shall occur which
in the judgment of the Partnership or counsel to the Underwriters should be set
forth in the Prospectus in order to make any statement therein, in the light of
the circumstances under which it was made, not misleading, or if it is necessary
to supplement or amend the Prospectus to comply with law, the Partnership will
forthwith prepare and duly file with the Commission an appropriate supplement or
amendment thereto, and will deliver to each Underwriter, without charge, such
number of copies thereof as the Underwriters may reasonably request. The
Partnership shall not file any document under the Exchange Act before the
completion of the distribution of the Common Units by the Underwriters (which
includes the distribution of any Common Units pursuant to the Option, if
exercised), of the Units by the Underwriters if such document would be deemed to
be incorporated by reference into the Prospectus unless the filing of such
document is approved by the Underwriters after reasonable notice thereof.
(f) Prior to any public offering of the Units by the
Underwriters, the Partnership will cooperate with the Underwriters and counsel
to the Underwriters in connection with the registration or qualification of the
Units for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Underwriters may request; provided, that in no event shall
the Partnership be obligated to qualify to do business in any jurisdiction where
it is not now so qualified or to take any action which would subject it to
general service of process in any jurisdiction where it is not now so subject.
<PAGE> 14
(g) During the period of three years commencing on the Closing
Date, the Partnership will, upon request, furnish to the Underwriters a copy of
such financial statements and other periodic and special reports as the
Partnership may from time to time distribute generally to the holders of any
class of its limited partnership interests, and will furnish to the Underwriters
who so request a copy of each annual or other report it shall be required to
file with the Commission.
(h) The Partnership will make generally available to holders
of its securities as soon as may be practicable but in no event later than the
last day of the fifteenth full calendar month following the calendar quarter in
which the Effective Date falls, an earnings statement (which need not be audited
but shall be in reasonable detail) for a period of twelve months ended
commencing after the Effective Date, and satisfying the provisions of Section
11(a) of the Act (including Rule 158 of the Rules and Regulations).
(i) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Partnership will
pay, or reimburse if paid by the Underwriters, all costs and expenses incident
to the performance of the obligations of the EOTT Entities under this Agreement,
including but not limited to costs and expenses of or relating to (1) the
preparation, printing and filing of the Registration Statement and exhibits
thereto and the Prospectus and any amendment or supplement thereto, (2) the
preparation and delivery of certificates representing the Units, (3) the word
processing, printing and reproduction of this Agreement, the Agreement Among
Underwriters, and any Dealer Agreements and the Underwriters' Questionnaire, (4)
furnishing (including costs of shipping, mailing and courier) such copies of the
Registration Statement, the Prospectus and all amendments and supplements
thereto, as may be requested for use in connection with the offering and sale of
the Units by the Underwriters or by dealers to whom Units may be sold, (5) the
listing of the Units on the New York Stock Exchange, (6) any filings required to
be made by the Underwriters with the NASD, if any, and the fees, disbursements
and other charges of counsel for the Underwriters in connection therewith, (7)
the registration or qualification of the Units for offer and sale under the
securities or Blue Sky laws of such jurisdictions designated pursuant to Section
4(f), if any are so required, including the fees, disbursements and other
charges of counsel to the Underwriters in connection therewith, and the
preparation and printing of preliminary, supplemental and final Blue Sky
memoranda, (8) counsel to the EOTT Entities, (9) the transfer agent for the
Units and (10) the Accountants.
(j) If (1) this Agreement shall be terminated by the
Partnership pursuant to any of the provisions hereof, (2) for any reason the
Partnership shall be unable to perform its obligations hereunder, (3) any other
condition of the Underwriters' obligations hereunder required to be fulfilled by
any of the EOTT Entities is not fulfilled or (4) this Agreement shall be
terminated pursuant to Section 7(i), the Partnership will reimburse the several
Underwriters for all out-of-pocket expenses (including the fees, disbursements
and other charges of counsel to the Underwriters) reasonably incurred by them in
connection herewith; provided, however, that if this Agreement shall be
terminated pursuant to Section 8 by reason of the default of one or more
Underwriters, the Partnership shall not be obligated to reimburse any defaulting
Underwriter on account of these expenses.
<PAGE> 15
(k) The Partnership will not at any time, directly or
indirectly, take any action intended, or which might reasonably be expected, to
cause or result in, or which will constitute, stabilization of the price of the
Common Units to facilitate the sale or resale of any of the Units .
(l) The Partnership will apply the net proceeds from the
offering and sale of the Units to be sold by the Partnership in the manner set
forth in the Prospectus Supplement under "Use of Proceeds."
(m) During the period of 90 days commencing at the Closing
Date, each of the EOTT Entities will not, without the prior written consent of
PaineWebber Incorporated, (i) directly or indirectly, sell, offer to sell, grant
any option for the sale of, or otherwise dispose of, any Common Units,
Subordinated Units or securities convertible into Common Units or Subordinated
Units other than to the Underwriters pursuant to this Agreement and other than
pursuant to employee option plans or (ii) enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Common Units or Subordinated Units, whether any
such transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Units, Subordinated Units or such other securities, in cash
or otherwise.
(n) The Partnership shall have caused each of the executive
officers and directors of the General Partner and each beneficial owner of more
than 5% of the outstanding Common Units or Subordinated Units, including Enron
Corp. but excluding Koch, to enter into agreements with the Underwriters in the
form set forth in Exhibit B to the effect that they will not, for a period of 90
days after the commencement of the public offering of the Units, without the
prior written consent of PaineWebber Incorporated, sell, contract to sell or
otherwise dispose of any Common Units, Subordinated Units or rights to acquire
such Units (other than pursuant to employee option plans or in connection with
other employee incentive compensation arrangements).
(o) The Partnership will exercise fully all, and will not
waive any, of its rights under Section 10.12 of the Purchase and Sale Agreement
dated September 21, 1998 by and among the Partnership, EOTT Energy Operating
Limited Partnership, Koch Oil Company and Koch Pipeline Company (together,
"Koch"), regarding deferral of the filing of a requested registration of Common
Units or the inclusion of any Common Units held by Koch in a registration
statement until the earlier of either of the following: (i) 180 days after the
Closing Date and (ii) March 1, 2000.
5. Conditions of the Obligations of the Underwriters. In addition to
the execution and delivery of the Price Determination Agreement, the obligations
of each Underwriter hereunder are subject to the following conditions:
(a) Notification that all filings required by Rule 424 of the
Rules and Regulations shall have been made.
(b) (i) No stop order suspending the effectiveness of the
Registration
<PAGE> 16
Statement shall have been issued and no proceedings for that purpose shall be
pending or threatened by the Commission, (ii) no order suspending the
effectiveness of the Registration Statement or the qualification or registration
of the Units under the securities or Blue Sky laws of any jurisdiction shall be
in effect and no proceeding for such purpose shall be pending before or
threatened or contemplated by the Commission or the authorities of any such
jurisdiction, (iii) any request for additional information on the part of the
staff of the Commission or any such authorities shall have been complied with to
the satisfaction of the staff of the Commission or such authorities and (iv)
after the date hereof no amendment or supplement to the Registration Statement
or the Prospectus shall have been filed unless a copy thereof was first
submitted to the Underwriters and the Underwriters did not object thereto in
good faith, and the Underwriters shall have received certificates, dated the
Closing Date and the Option Closing Date signed by the Chief Executive Officer
or the Chairman of the Board of Directors of the General Partner and the Chief
Financial Officer of the General Partner (who may, as to proceedings threatened,
rely upon the best of their information and belief), to the effect of clauses
(i), (ii) and (iii).
(c) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) there shall not have
been, and no development shall have occurred which could reasonably be expected
to result in, a material adverse change in the general affairs, business,
business prospects, properties, management, condition (financial or otherwise),
partners' capital or results of operations of the EOTT Entities, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, in each case other than as set forth in or contemplated by the
Registration Statement and the Prospectus and (ii) none of the EOTT Entities
shall have sustained any loss or interference with its business or properties
from fire, explosion, flood or other casualty, whether or not covered by
insurance, or from any labor dispute or any court or legislative or other
governmental action, order or decree, which is not set forth in the Registration
Statement and the Prospectus, if in the judgment of the Underwriters any such
development described in clause (i) or (ii) makes it impracticable or
inadvisable to consummate the sale and delivery of the Units by the Underwriters
at the public offering price.
(d) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there shall have been no
litigation or other proceeding instituted against any of the EOTT Entities or
any of their respective officers or directors in their capacities as such,
before or by any Federal, state or local court, commission, regulatory body,
administrative agency or other governmental body, domestic or foreign, in which
litigation or proceeding an unfavorable ruling, decision or finding could
materially and adversely affect the business, properties, business prospects,
condition (financial or otherwise) or results of operations of the EOTT
Entities, taken as a whole.
(e) Each of the representations and warranties of the EOTT
Entities contained herein shall be true and correct in all material respects at
the Closing Date, and with respect to the Option Units, at the Option Closing
Date as if made at the Option Closing Date, and all covenants and agreements
herein contained to be performed on the part of the EOTT Entities and all
conditions herein contained to be fulfilled or complied with by the EOTT
Entities at or prior to the Closing Date, and with respect to the Option Units,
at the Option Closing Date, shall have
<PAGE> 17
been duly performed, fulfilled or complied with; provided, however, that if any
such representation or warranty is already qualified by materiality, for
purposes of determining whether this condition has been satisfied, such
representation or warranty as so qualified must be true and correct in all
respects.
(f) The Underwriters shall have received an opinion, dated the
Closing Date, and with respect to the Option Units, at the Option Closing Date,
and satisfactory in form and substance to counsel for the Underwriters, from
Vinson & Elkins L.L.P., counsel to the EOTT Entities, to the effect set forth in
Exhibit C.
(g) The Underwriters shall have received an opinion, dated the
Closing Date, and with respect to the Option Units, at the Option Closing Date,
and satisfactory in form and substance to counsel for the Underwriters, from
Stephen W. Duffy, Esq., General Counsel of the General Partner, to the effect
set forth in Exhibit D.
(h) The Underwriters shall have received an opinion, dated the
Closing Date, and with respect to the Option Units, at the Option Closing Date,
from Andrews & Kurth L.L.P. , counsel to the Underwriters which opinion shall be
satisfactory in all respects to the Underwriters.
(i) On the date of this Agreement, Arthur Andersen LLP shall
have furnished to the Underwriters a letter, dated the date of its delivery,
addressed to the Underwriters and in form and substance satisfactory to the
Underwriters, confirming that they are independent accountants with respect to
the EOTT Entities as required by the Act and the Rules and Regulations, and with
respect to the financial and other statistical and numerical information
contained in the Registration Statement or incorporated by reference therein. At
the Closing Date and, with respect to the Option Units, at the Option Closing
Date, Arthur Andersen LLP shall have furnished to the Underwriters a letter,
dated the date of its delivery, which shall confirm, on the basis of a review in
accordance with the procedures set forth in the letter from Arthur Andersen LLP,
that nothing has come to their attention during the period from the date of the
letter referred to in the prior sentence to a date (specified in the letter) not
more than five days prior to the Closing Date and the Option Closing Date which
would require any change in their letter dated the date hereof, if it were
required to be dated and delivered at the Closing Date and the Option Closing
Date. Arthur Andersen LLP shall have furnished to the Underwriters a review
report with respect to the interim financial statements for the six-month period
ended June 30, 1999.
(j) At the Closing Date and, with respect to the Option Units,
at the Option Closing Date, there shall be furnished to the Underwriters an
accurate certificate, dated the date of its delivery, signed by each of the
Chief Executive Officer and the Chief Financial Officer of the General Partner,
in form and substance satisfactory to the Underwriters, to the effect that:
(i) Each signer of such certificate has carefully
examined the Registration Statement, the Prospectus (including any
documents filed under the Exchange Act and deemed to be incorporated by
reference into the Prospectus) and (A) as
<PAGE> 18
of the date of such certificate, such documents are true and correct in
all material respects and do not omit to state a material fact required
to be stated therein or necessary in order to make the statements
therein not untrue or misleading and (B) since the Effective Date, no
event has occurred as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein not
untrue or misleading in any material respect and there has been no
document required to be filed under the Exchange Act and the Exchange
Act Rules and Regulations that upon such filing would be deemed to be
incorporated by reference into the Prospectus that has not been so
filed;
(ii) Each of the representations and warranties of
the EOTT Entities contained in this Agreement were, when originally
made, and are, at the time such certificate is delivered, true and
correct in all material respects;
(iii) Each of the covenants required herein to be
performed by the EOTT Entities on or prior to the delivery of such
certificate has been duly, timely and fully performed and each
condition herein required to be complied with by the EOTT Entities on
or prior to the date of such certificate has been duly, timely and
fully complied with; and
(iv) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
(A) there has not been, and no development has occurred which could
reasonably be expected to result in, a material adverse change in the
general affairs, business, business prospects, properties, management,
condition (financial or otherwise) or results of operations of the EOTT
Entities, taken as a whole, whether or not arising from transactions in
the ordinary course of business, in each case other than as set forth
in or contemplated by the Registration Statement and the Prospectus and
(B) none of the EOTT Entities has sustained any material loss or
interference with its business or properties from fire, explosion,
flood or other casualty, whether or not covered by insurance, or from
any labor dispute or any court or legislative or other governmental
action, order or decree, which is not set forth in the Registration
Statement and the Prospectus;
and such other matters as the Underwriters may reasonably request.
(k) On or prior to the Closing Date, the Underwriters shall
have received the executed agreements referred to in Section 4(n).
(l) The Units shall be qualified for sale in such states as
the Underwriters may reasonably request, each such qualification shall be in
effect and not subject to any stop order or other proceeding on the Closing Date
and the Option Closing Date.
(m) Prior to the Closing Date, the Units shall have been duly
authorized for listing by the New York Stock Exchange upon official notice of
issuance.
(n) The EOTT Entities shall have furnished to the Underwriters
such
<PAGE> 19
certificates, in addition to those specifically mentioned herein, as the
Underwriters may have reasonably requested as to the accuracy and completeness
at the Closing Date and the Option Closing Date of any statement in the
Registration Statement or the Prospectus or any documents filed under the
Exchange Act and deemed to be incorporated by reference into the Prospectus, as
to the accuracy at the Closing Date and the Option Closing Date of the
representations and warranties of the EOTT Entities herein, as to the
performance by the EOTT Entities of its obligations hereunder, or as to the
fulfillment of the conditions concurrent and precedent to the obligations
hereunder of the Underwriters.
6. Indemnification. (a) The EOTT Entities will, jointly and severally,
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person, if any, who controls each
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act from and against any and all losses, claims, liabilities, expenses
and damages (including, but not limited to, any and all investigative, legal and
other expenses reasonably incurred in connection with, and any and all amounts
paid in settlement of, any action, suit or proceeding between any of the
indemnified parties and any indemnifying parties or between any indemnified
party and any third party, or otherwise, or any claim asserted), as and when
incurred, to which any Underwriter, or any such person, may become subject under
the Act, the Exchange Act or other Federal or state statutory law or regulation,
at common law or otherwise, insofar as such losses, claims, liabilities,
expenses or damages arise out of or are based on (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus or any amendment or supplement to the Registration
Statement or the Prospectus or in any documents filed under the Exchange Act and
deemed to be incorporated by reference into the Prospectus, or in any
application or other document executed by or on behalf of any of the EOTT
Entities or based on written information furnished by or on behalf of any of the
EOTT Entities filed in any jurisdiction in order to qualify the Units under the
Securities Laws thereof or filed with the Commission, (ii) the omission or
alleged omission to state in such document a material fact required to be stated
in it or necessary to make the statements in it not misleading or (iii) any act
or failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Units or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, liability, expense or damage arising out of or based upon matters
covered by clause (i) or (ii) above (provided that the EOTT Entities shall not
be liable under this clause (iii) to the extent it is finally judicially
determined by a court of competent jurisdiction that such loss, claim,
liability, expense or damage resulted directly from any such acts or failures to
act undertaken or omitted to be taken by such Underwriter through its gross
negligence or willful misconduct); provided that the EOTT Entities will not be
liable to the extent that such loss, claim, liability, expense or damage (A)
arises from the sale of the Units in the public offering to any person by an
Underwriter and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
relating to any Underwriter furnished in writing to the Partnership by any
Underwriter expressly for inclusion in the Registration Statement or the
Prospectus, which information consists solely of the information specified in
Section 3(b) or (B) results solely from an untrue statement of a material fact
contained in, or the omission of a material fact from, such preliminary
prospectus, which untrue statement or omission was completely corrected in the
<PAGE> 20
Prospectus (as then amended or supplemented) if the Partnership shall sustain
the burden of proving that the Underwriters sold Units to the person alleging
such loss, claim, liability, expense or damage without sending or giving, at or
prior to the written confirmation of such sale, a copy of the Prospectus (as
then amended or supplemented) if the Partnership had previously furnished copies
thereof to the Underwriters within a reasonable amount of time prior to such
sale or such confirmation, and the Underwriters failed to deliver the corrected
Prospectus, if required by law to have so delivered it and if delivered would
have been a complete defense against the person asserting such loss, claim,
liability, expense or damage. This indemnity agreement will be in addition to
any liability that the EOTT Entities might otherwise have.
(b) Each Underwriter, severally and not jointly, will
indemnify and hold harmless the EOTT Entities, each person, if any, who controls
the EOTT Entities within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, each director of the EOTT Entities and each officer of the
EOTT Entities who signed the Registration Statement to the same extent as the
foregoing indemnity from the EOTT Entities to each Underwriter, but only insofar
as losses, claims, liabilities, expenses, or damages arise out of or are based
on any untrue statement or omission or alleged untrue statement or omission of a
material fact made in reliance on and in conformity with information relating to
such Underwriter furnished in writing to the Partnership by such Underwriter
expressly for use in the Registration Statement or the Prospectus. This
indemnity will be in addition to any liability that each Underwriter might
otherwise have; provided, however, that in no case shall any Underwriter be
liable or responsible for any amount in excess of the underwriting discounts and
commissions received by such Underwriter.
(c) Any party that proposes to assert the right to be
indemnified under this Section 6 will, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim is to
be made against an indemnifying party or parties under this Section 6, notify
each such indemnifying party of the commencement of such action, enclosing a
copy of all papers served, but the omission so to notify such indemnifying party
will not relieve it from any liability that it may have to any indemnified party
under the foregoing provisions of this Section 6 unless, and only to the extent
that, such omission results in the forfeiture of substantive rights or defenses
by the indemnifying party. If any such action is brought against any indemnified
party and it notifies the indemnifying party of its commencement, the
indemnifying party will be entitled to participate in and, to the extent that it
elects by delivering written notice to the indemnified party promptly after
receiving notice of the commencement of the action from the indemnified party,
jointly with any other indemnifying party similarly notified, to assume the
defense of the action, with counsel satisfactory to the indemnified party, and
after notice from the indemnifying party to the indemnified party of its
election to assume the defense, the indemnifying party will not be liable to the
indemnified party for any legal or other expenses except as provided below and
except for the reasonable costs of investigation subsequently incurred by the
indemnified party in connection with the defense. The indemnified party will
have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel will be at the expense of such
indemnified party unless (1) the employment of counsel by the indemnified party
has been authorized in writing by the indemnifying party, (2) the indemnified
party has reasonably concluded (based on advice of
<PAGE> 21
counsel) that there may be legal defenses available to it or other indemnified
parties that are different from or in addition to those available to the
indemnifying party, (3) a conflict or potential conflict exists (based on advice
of counsel to the indemnified party) between the indemnified party and the
indemnifying party (in which case the indemnifying party will not have the right
to direct the defense of such action on behalf of the indemnified party) or (4)
the indemnifying party has not in fact employed counsel to assume the defense of
such action within a reasonable time after receiving notice of the commencement
of the action, in each of which cases the reasonable fees, disbursements and
other charges of counsel will be at the expense of the indemnifying party or
parties. It is understood that the indemnifying party or parties shall not, in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the reasonable fees, disbursements and other charges of more than
one separate firm (in addition to local counsel) admitted to practice in such
jurisdiction at any one time for all such indemnified party or parties. All such
fees, disbursements and other charges will be reimbursed by the indemnifying
party promptly as they are incurred. An indemnifying party will not be liable
for any settlement of any action or claim effected without its written consent
(which consent will not be unreasonably withheld). No indemnifying party shall,
without the prior written consent of each indemnified party, settle or
compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding relating to the matters contemplated by this Section
6 (whether or not any indemnified party is a party thereto), unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising or that may arise out of such
claim, action or proceeding.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 6 is applicable in accordance with its terms but for
any reason is held to be unavailable from the EOTT Entities or the Underwriters,
the EOTT Entities and the Underwriters will contribute to the total losses,
claims, liabilities, expenses and damages (including any investigative, legal
and other expenses reasonably incurred in connection with, and any amount paid
in settlement of, any action, suit or proceeding or any claim asserted, but
after deducting any contribution received by the EOTT Entities from persons
other than the Underwriters, such as persons who control the EOTT Entities
within the meaning of the Act, officers of the EOTT Entities who signed the
Registration Statement and directors of the EOTT Entities, who also may be
liable for contribution) to which the EOTT Entities and any one or more of the
Underwriters may be subject in such proportion as shall be appropriate to
reflect the relative benefits received by the EOTT Entities on the one hand and
the Underwriters on the other. The relative benefits received by the EOTT
Entities on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Partnership bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus Supplement. If, but only
if, the allocation provided by the foregoing sentence is not permitted by
applicable law, the allocation of contribution shall be made in such proportion
as is appropriate to reflect not only the relative benefits referred to in the
foregoing sentence but also the relative fault of the EOTT Entities, on the one
hand, and the Underwriters, on the other, with respect to the statements or
omissions which resulted in such loss, claim, liability, expense or damage, or
action in respect thereof, as well as any other relevant equitable
considerations with respect to such offering. Such relative
<PAGE> 22
fault shall be determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the EOTT Entities or the Underwriters,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such statement or omission. The EOTT
Entities and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 6(d) were to be 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 into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, liability, expense or
damage, or action in respect thereof, referred to above in this Section 6(d)
shall be deemed to include, for purpose of this Section 6(d), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6(d), no Underwriter shall be required to contribute
any amount in excess of the underwriting discounts and commissions received by
it and no person found guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) will be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this Section 6(d) are
several in proportion to their respective underwriting obligations and not
joint. For purposes of this Section 6(d), any person who controls a party to
this Agreement within the meaning of the Act will have the same rights to
contribution as that party, and each officer of the EOTT Entities who signed the
Registration Statement will have the same rights to contribution as the EOTT
Entities, subject in each case to the provisions hereof. Any party entitled to
contribution, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim for contribution may be made
under this Section 6(d), will notify any such party or parties from whom
contribution may be sought, but the omission so to notify will not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have under this Section 6(d). Except for a settlement entered
into pursuant to the last sentence of Section 6(c) hereof, no party will be
liable for contribution with respect to any action or claim settled without its
written consent (which consent will not be unreasonably withheld).
(e) The indemnity and contribution agreements contained in
this Section 6 and the representations and warranties of the EOTT Entities
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any investigation made by or on behalf of the Underwriters,
(ii) acceptance of the Units and payment therefore or (iii) any termination of
this Agreement.
7. Termination. The obligations of the several Underwriters under this
Agreement may be terminated at any time on or prior to the Closing Date(or, with
respect to the Option Units, on or prior to the Option Closing Date), by notice
to the Partnership from the Underwriters, without liability on the part of any
Underwriter to the EOTT Entities, if, prior to delivery and payment for the Firm
Units (or the Option Units, as the case may be), the Underwriters shall decline
to purchase the Units for any reason permitted under this Agreement or, in the
sole judgment of the Underwriters, (i) there has been, since the respective
dates as of which information is given in the Registration Statement, any
material adverse change in any of the EOTT Entities' properties, business
prospects, condition (financial or otherwise) or results of
<PAGE> 23
operations, (ii) trading in any of the equity securities of the Partnership
shall have been suspended by the Commission, the NASD or by the New York Stock
Exchange, (iii) trading in securities generally on the New York Stock Exchange
or the Nasdaq Stock Market shall have been suspended or limited or minimum or
maximum prices shall have been generally established on such exchange or over
the counter market, or additional material governmental restrictions, not in
force on the date of this Agreement, shall have been imposed upon trading in
securities generally by such exchange or by order of the Commission or the NASD
or any court or other governmental authority, (iv) a general banking moratorium
shall have been declared by either Federal or New York State authorities or (v)
any material adverse change in the financial or securities markets in the United
States or in political, financial or economic conditions in the United States or
any outbreak or material escalation of hostilities or declaration by the United
States of a national emergency or war or other calamity or crisis shall have
occurred the effect of any of which is such as to make it, in the sole judgment
of the Underwriters, impracticable or inadvisable to market the Units on the
terms and in the manner contemplated by the Prospectus.
8. Substitution of Underwriters. If any one or more of the Underwriters
shall fail or refuse to purchase any of the Firm Units which it or they have
agreed to purchase hereunder, and the aggregate number of Firm Units which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate number of Firm Units, the other
Underwriters shall be obligated, severally, to purchase the Firm Units which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase, in the proportions which the number of Firm Units which they have
respectively agreed to purchase pursuant to Section 1 bears to the aggregate
number of Firm Units which all such non-defaulting Underwriters have so agreed
to purchase, or in such other proportions as such non-defaulting Underwriters
may specify; provided that in no event shall the maximum number of Firm Units
which any Underwriter has become obligated to purchase pursuant to Section 1 be
increased pursuant to this Section 8 by more than one-ninth of the number of
Firm Units agreed to be purchased by such Underwriter without the prior written
consent of such Underwriter. If any Underwriter or Underwriters shall fail or
refuse to purchase any Firm Units and the aggregate number of Firm Units which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase exceeds one-tenth of the aggregate number of the Firm Units and
arrangements satisfactory to the non-defaulting Underwriters and the Partnership
for the purchase of such Firm Units are not made within 48 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Partnership for the purchase or sale of any
Units under this Agreement. In any such case either the Underwriters or the
Partnership shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken pursuant to this Section 8 shall
not relieve any defaulting Underwriter from liability in respect of any default
of such Underwriter under this Agreement.
9. Miscellaneous. Notice given pursuant to any of the provisions of
this Agreement shall be in writing and, unless otherwise specified, shall be
mailed or delivered (a) if to the EOTT Entities, at the office of 1330 Post Oak
Boulevard, Suite 2700, Houston, Texas 77002, Attention: Steve Duffy or (b) if to
the Underwriters, at the offices of PaineWebber Incorporated,
<PAGE> 24
1285 Avenue of the Americas, New York, New York 10019, Attention: Corporate
Finance Department. Any such notice shall be effective only upon receipt. Any
notice under Section 7 or 8 hereof may be made by telex or telephone, but if so
made shall be subsequently confirmed in writing.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the EOTT Entities and of the controlling persons,
directors and officers referred to in Section 6, and their respective successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" as used in this
Agreement shall not include a purchaser, as such purchaser, of Units from any of
the several Underwriters.
All representations, warranties and agreements of the EOTT Entities
contained herein or in certificates or other instruments delivered pursuant
hereto, shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Underwriter or any of its controlling
persons and shall survive delivery of and payment for the Units hereunder.
Any action required or permitted to be taken by the Underwriters under
this Agreement may be taken by them jointly or by PaineWebber Incorporated.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS
PRINCIPLES OF SUCH STATE.
This Agreement may be signed in two or more counterparts with the same
effect as if the signatures thereto and hereto were upon the same instrument.
In case any provision in this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
The EOTT Entities and the Underwriters each hereby irrevocably waive
any right they may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or the transactions contemplated hereby.
This Agreement may not be amended or otherwise modified or any
provision hereof waived except by an instrument in writing signed by the EOTT
Entities and the Underwriters.
Please confirm that the foregoing correctly sets forth the agreement
among the EOTT Entities and the several Underwriters.
Very truly yours,
EOTT ENERGY PARTNERS, L.P.
<PAGE> 25
By: EOTT ENERGY CORP., its General Partner
By: /s/ Michael Burke
------------------------------
Name: Michael Burke
Title: President
EOTT ENERGY FINANCE CORP.
By: /s/ Michael Burke
------------------------------
Name: Michael Burke
Title: President
EOTT ENERGY CORP.
By: /s/ Michael Burke
------------------------------
Name: Michael Burke
Title: President
EOTT ENERGY OPERATING LIMITED
PARTNERSHIP
By: EOTT ENERGY CORP., its General Partner
By: /s/ Michael Burke
------------------------------
Name: Michael Burke
Title: President
EOTT ENERGY PIPELINE LIMITED
PARTNERSHIP
By: EOTT ENERGY CORP., its General Partner
By: /s/ Michael Burke
------------------------------
Name: Michael Burke
Title: President
<PAGE> 26
EOTT ENERGY CANADA LIMITED
PARTNERSHIP
By: EOTT ENERGY CORP., its General Partner
By: /s/ Michael Burke
------------------------------
Name: Michael Burke
Title: President
<PAGE> 27
Confirmed as of the date first above mentioned:
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER
INCORPORATED
ING BARINGS LLC
By: PAINEWEBBER INCORPORATED
By: /s/ Rob Wallace
-----------------------------
Name: Rob Wallace
Title: Vice President
<PAGE> 28
SCHEDULE I
UNDERWRITERS
<TABLE>
<CAPTION>
NUMBER OF FIRM UNITS
NAME OF UNDERWRITERS TO BE PURCHASED
-------------------- --------------------
<S> <C>
PaineWebber Incorporated 1,750,000
Lehman Brothers Inc. 1,050,000
Dain Rauscher Wessels, a division of Dain
Rauscher Incorporated 525,000
ING Barings LLC 175,000
---------
Total 3,500,000
</TABLE>
<PAGE> 29
EXHIBIT A
EOTT ENERGY PARTNERS, L.P.
PRICE DETERMINATION AGREEMENT
September 23, 1999
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER INCORPORATED
ING BARINGS LLC
c/o PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
Reference is made to the Underwriting Agreement, dated September 23,
1999 (the "Underwriting Agreement"), among the EOTT Entities and the several
Underwriters named in Schedule I thereto or hereto (the "Underwriters"). The
Underwriting Agreement provides for the purchase by the Underwriters from the
Partnership, subject to the terms and conditions set forth therein, of an
aggregate of 3,500,000 Firm Units. This Agreement is the Price Determination
Agreement referred to in the Underwriting Agreement. Capitalized terms used
herein but not defined shall have the meanings assigned to such terms in the
Underwriting Agreement.
Pursuant to Section 1 of the Underwriting Agreement, the undersigned
agree as follows:
The public offering price per Common Unit for the Firm Units shall be
$16.00.
The purchase price per Common Unit for the Firm Units to be paid by
the Underwriters shall be $15.12 representing an amount equal to the public
offering price set forth above, less $.88 per Common Unit.
The EOTT Entities represent and warrant to the Underwriters that the
representations and warranties of the EOTT Entities set forth in Section 3 of
the Underwriting Agreement are accurate, as though expressly made at and as of
the date hereof.
<PAGE> 30
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS
PRINCIPLES OF SUCH STATE.
If the foregoing is in accordance with your understanding of the
agreement among the EOTT Entities and the Underwriters, please sign and return
to the Partnership a counterpart hereof, whereupon this instrument along with
all counterparts and together with the Underwriting Agreement shall be a
binding agreement among the EOTT Entities and the Underwriters in accordance
with its terms and the terms of the Underwriting Agreement.
Very truly yours,
<PAGE> 31
EOTT ENERGY PARTNERS, L.P.
By: EOTT ENERGY CORP., its General
Partner
By: /s/ Michael Burke
Name: Michael Burke
Title: President
EOTT ENERGY FINANCE CORP.
By: /s/ Michael Burke
Name: Michael Burke
Title: President
EOTT ENERGY CORP.
By: /s/ Michael Burke
Name: Michael Burke
Title: President
EOTT ENERGY OPERATING LIMITED
PARTNERSHIP
By: EOTT ENERGY CORP., its General
Partner
By: /s/ Michael Burke
Name: Michael Burke
Title: President
EOTT ENERGY PIPELINE LIMITED
PARTNERSHIP
By: EOTT ENERGY CORP., its
General Partner
By: /s/ Michael Burke
Name: Michael Burke
Title: President
<PAGE> 32
EOTT ENERGY CANADA LIMITED
PARTNERSHIP
By: EOTT ENERGY CORP., its
General Partner
<PAGE> 33
By: /s/ Michael Burke
---------------------------------
Name: Michael Burke
Title: President
Confirmed as of the date first
above mentioned:
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER INCORPORATED
ING BARINGS LLC
By: PAINEWEBBER INCORPORATED
By: /s/ Rob Wallace
-----------------------------
Name: Rob Wallace
Title: Vice President
<PAGE> 34
EXHIBIT B
September 23, 1999
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER INCORPORATED
ING BARINGS LLC
c/o PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
In consideration of the agreement of the several Underwriters to
underwrite a proposed public offering (the "Offering") of 3,500,000 Common
Units (the "Common Units") of EOTT Energy Partners, L.P., a Delaware limited
partnership (the "Partnership") , as contemplated by a registration statement
with respect to such Common Units filed with the Securities and Exchange
Commission on Form S-3 (Registration No. 333-82269), the undersigned hereby
agrees that the undersigned will not, for a period of 90 days after the
commencement of the public offering of such Units, without the prior written
consent of PaineWebber Incorporated, (i) directly or indirectly, sell, offer to
sell, grant any option for the sale of, or otherwise dispose of, any Common
Units, units representing subordinated limited partner interests ("Subordinated
Units") or securities convertible into Common Units other than pursuant to
employee option plans, (ii) enter into any swap or other arrangement that
transfers to another, in whole or in part, any of the economic consequences of
ownership of the Common Units or Subordinated Units, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Units, Subordinated Units or such other securities, in cash or
otherwise or (iii) require the Partnership to file with the Securities and
Exchange Commission a registration statement under the Securities Act of 1933
to register any Common Units or Subordinated Units or securities convertible
into or exchangeable for Common Units or Subordinated Units or warrants or
other rights to acquire Common Units or Subordinated Units of which the
undersigned is now, or may in the future become, the beneficial owner within
the meaning of Rule 13d-3 under the Securities Exchange Act of 1934 [(other
than pursuant to employee unit option plans or in connection with other
employee incentive compensation arrangements)].
Very truly yours,
By:
------------------------------
Name:
------------------------------
<PAGE> 35
EXHIBIT C
September 29, 1999
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER INCORPORATED
ING BARINGS LLC
c/o PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Ladies and Gentlemen:
This opinion is provided to you pursuant to Section 5(f) of that
certain Underwriting Agreement, dated September 23, 1999 (the "Underwriting
Agreement"), among EOTT Energy Partners, L.P., a Delaware limited partnership
(the "Partnership"), EOTT Energy Operating Limited Partnership, a Delaware
limited partnership ("Energy OLP"), EOTT Energy Pipeline Limited Partnership, a
Delaware limited partnership ("Pipeline OLP"), EOTT Energy Canada Limited
Partnership, a Delaware limited partnership ("Canada OLP"), EOTT Energy Corp.,
a Delaware corporation (the "General Partner"), and PaineWebber Incorporated,
Lehman Brothers Inc., Dain Rauscher Wessels, a Division of Dain Rauscher
Incorporated, and ING Barings LLC (the "Underwriters"). Any capitalized term
used in this opinion and not defined shall have the meaning assigned to such
term in the Underwriting Agreement. This opinion is being provided for the
closing contemplated by the Underwriting Agreement of the offer and sale of the
Firm Units (the "Closing Date").
We have acted as counsel to the Partnership, the Operating
Partnerships, and the General Partner in connection with the offer and sale by
the Partnership of 3,500,000 Firm Units. In connection with the opinions
expressed below, we have examined the following:
(a) executed originals or counterparts of the Partnership
Agreement and the Operating Partnership Agreements (the "Partnership
Agreements");
(b) a copy of the Certificate of Limited Partnership of the
Partnership, as filed with the Secretary of State of the State of
Delaware;
(c) a copy of the Certificate of Limited Partnership of each
of the Operating Partnerships, as filed with the Secretary of State of
the State of Delaware;
<PAGE> 36
(d) copies of letters, certificates or telegrams of recent
dates received by us from public officials as to the qualification or
registration of Energy OLP, Pipeline OLP, Canada OLP, the Partnership,
and the General Partner;
(e) copies of letters, certificates or telegrams of recent
dates received by us from public officials in the State of Delaware as
to the due formation and valid existence of the Partnership and each
of the Operating Partnerships;
(f) a copy of the Certificate of Incorporation and Bylaws of
the General Partner;
(g) copies of letters, certificates or telegrams of recent
dates received by us from public officials in the State of Delaware as
to the due incorporation, valid existence and good standing of the
General Partner;
(h) the Registration Statement and the Prospectus;
(i) evidence satisfactory to us of the effectiveness of the
Registration Statement under the Act;
(j) reports, dated as of recent dates, prepared by CT
Corporation purporting to describe all financing statements on file as
of the dates thereof in the office of the Secretary of State of the
State of Delaware naming the Partnership or the General Partner, or
both of them, as debtors;
(k) a certificate from an authorized officer of the
Partnership, dated as of a recent date, (i) identifying all
indentures, mortgages, deeds of trusts, loan agreements, bonds,
debentures, note agreements, capital leases and other evidences of
indebtedness for borrowed money to which any of the EOTT Entities is a
party or by which any EOTT Entity is bound or to which any property or
assets of any EOTT Entity is subject, (ii) certifying that there are
no voting trust arrangements to which any of the EOTT Entities is a
party, (iii) certifying that the only subsidiaries (as defined in the
Rules and Regulations) of the Partnership are the Operating
Partnerships and the Finance Sub, and (iv) certifying that except for
the limited partner interests in the Operating Limited Partnerships
and the stock of the Finance Sub, the Partnership does not own at the
Closing Date, directly or indirectly, any shares of stock or any other
equity or long-term debt securities of any corporation or have any
equity interest in any firm, partnership, joint venture, association
or other entity; and
(l) such other documents and records as we have deemed
necessary or advisable for purposes of the opinions expressed below.
Based on the foregoing, and subject to the qualifications and
limitations set forth below, we are of the opinion that:
<PAGE> 37
(1) Each of the Partnership and the Operating Partnerships
has been duly formed and is validly existing and in good standing as a
limited partnership under the Delaware Revised Uniform Limited
Partnership Act, as amended (the "Delaware Act"), with partnership
power and authority under the Delaware Act and the Partnership
Agreement or its Operating Partnership Agreement, respectively,
necessary to own, lease and operate its properties and conduct its
business as described in the Prospectus.
(2) The Partnership has been registered as a foreign limited
partnership for the transaction of business under the laws of each
jurisdiction in which the failure to so register would have a material
adverse effect upon the Partnership or subject it to any material
liability or disability.
(3) Energy OLP has been qualified or registered as a foreign
limited partnership for the transaction of business under the laws of
each jurisdiction in which the failure to so register would have a
material adverse effect upon Energy OLP or subject it to any material
liability or disability; Pipeline OLP has been qualified or registered
as a foreign limited partnership for the transaction of business under
the laws of each jurisdiction in which the failure to so register
would have a material adverse effect upon Pipeline OLP or subject it
to any material liability or disability; and Canada OLP has been
qualified or registered as a foreign limited partnership for the
transaction of business under the laws of each jurisdiction in which
the failure to so register would have a material adverse effect upon
Canada OLP or subject it to any material liability or disability.
(4) Each of the General Partner and Finance Sub has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware, with corporate power and
authority necessary to own, hold or lease its properties and, in all
material respects as described in the Prospectus, to conduct the
business in which it is engaged and, in the case of the General
Partner, to act as a general partner of the Partnership and each of
the Operating Partnerships. The General Partner is duly qualified to
do business and is in good standing as a foreign corporation under the
laws of each jurisdiction in which the failure to so register would
have a material adverse effect upon the General Partner or subject it
to any material liability or disability, and Finance Sub has not been
qualified to do business as a foreign corporation under any
jurisdiction.
(5) The General Partner is the sole general partner of the
Partnership and each of the Operating Partnerships with a general
partner interest in the Partnership of 1.0% and a general partner
interest in each of the Operating Partnerships of 1.0% (subject to the
provisions of the Partnership Agreement and the Operating Partnership
Agreements, respectively); such general partner interests are duly
authorized by the Partnership Agreement and the Operating
<PAGE> 38
Partnership Agreements, respectively, are validly issued and are owned
of record by the General Partner free and clear of all liens,
encumbrances, security interests, equities, charges or claims of
record (except as provided in the Partnership Agreement, the Operating
Partnership Agreements or pursuant to Section 17-607 of the Delaware
Act, as amended) (A) in respect of which a financing statement under
the Uniform Commercial Code of the State of Delaware naming the
General Partner as debtor is on file in the offices of the Secretary
of State of the State of Delaware or (B) otherwise known to us.
(6) To our knowledge, the only subsidiaries (as defined in
the Rules and Regulations) of the Partnership are the Operating
Partnerships and the Finance Sub. All of the outstanding shares of
capital stock of the Finance Sub have been duly authorized and validly
issued and are fully paid and nonassessable and are owned by the
Partnership free and clear of all liens and encumbrances and claims.
As of the Closing Date, the Partnership is the sole limited partner of
Energy OLP, and Energy OLP is the sole limited partner of Pipeline OLP
and Canada OLP, in each case with a limited partner interest of 99.0%
(subject to the provisions of the respective Operating Partnership
Agreements); each such limited partner interest is duly authorized by
the applicable Operating Partnership Agreement and is validly issued,
fully paid and nonassessable, except as such nonassessability may be
affected by Section 17-607 of the Delaware Act; and, at the Closing
Date, the Partnership or Energy OLP, as the case may be, owns such
limited partner interest in the Operating Partnership free and clear
of all liens, encumbrances, security interests, equities, charges or
claims of record (except as provided in the applicable Operating
Partnership Agreement or pursuant to the Delaware Act) (A) in respect
of which a financing statement under the Uniform Commercial Code of
the State of Delaware naming the Partnership as debtor is on file in
the offices of the Secretary of State of the State of Delaware or (B)
otherwise known to us. Except for such limited partner interests and
the stock of the Finance Sub, the Partnership does not, to our
knowledge, own at the Closing Date, directly or indirectly, any shares
of stock or any other equity or long-term debt securities of any
corporation or have any equity interest in any firm, partnership,
joint venture, association or other entity.
(7) Immediately prior to the Closing Date, the limited
partners of the Partnership hold limited partner interests in the
Partnership aggregating 99.0% (subject to the provisions of the
Partnership Agreement), such limited partner interests being
represented by 14,976,011 Common Units and 9,000,000 Subordinated
Units. As of the Closing Date, such limited partner interests are the
only limited partner interests of the Partnership that are issued and
outstanding. As of the Closing Date, the Units are authorized by the
Partnership Agreement and are validly issued, fully paid and
nonassessable, except as such nonassessability may be affected by
Section 17-607 of the Delaware Act.
<PAGE> 39
(8) Insofar as such descriptions relate to legal matters or
descriptions of provisions of the governing instruments, the Common
Units and the Subordinated Units conform in all material respects to
the descriptions thereof contained in the Prospectus.
(9) Except as described in the Prospectus or Section 4.3 of
the Partnership Agreement and except for the Underwriters'
over-allotment option, there are no preemptive or other rights to
subscribe for or to purchase, nor any restriction upon the voting or
transfer of, any limited partner interests of the Partnership or any
of the Operating Partnerships pursuant to (i) the statutes, judicial
and administrative decisions, and the rules and regulations of the
governmental agencies of the State of Delaware, (ii) the Partnership
Agreements or (iii) any agreement, document, contract or instrument
referred to in, filed as an exhibit to or incorporated by reference
in, the Registration Statement.
(10) To our knowledge, and other than as set forth in or
contemplated by the Prospectus, there are no legal or governmental
proceedings pending or threatened (i) to which any of the EOTT
Entities is a party or of which any property of any of such entities
is the subject, or to which any of their officers or directors in
their capacities as such is a party, which, if adversely determined to
such entity, might have a material adverse effect on the consolidated
financial position, results of operations, cash flows, business or
prospects of the Partnership and the Operating Partnerships considered
as a whole or (ii) which seek to challenge to legality or
enforceability of the Underwriting Agreement.
(11) The Registration Statement was declared effective under
the Act on September 2, 1999; the Prospectus was filed with the
Commission pursuant to subparagraphs (2) and (5) of Rule 424(b) of the
Rules and Regulations on September [ ], 1999; and no stop order
suspending the effectiveness of the Registration Statement has been
issued, and no proceeding for that purpose is pending or, to our
knowledge, threatened by the Commission.
(12) The Registration Statement and the Prospectus, including
any documents incorporated by reference into the Prospectus, at the
time they were filed (other than the financial statements and related
schedules or other financial or statistical data and the projected
data included therein, as to which we express no opinion) comply or
complied as to form in all material respects with the requirements of
the Act, the Rules and Regulations, the Exchange Act, and the Exchange
Act Rules and Regulations.
(13) To our knowledge, there are no contracts or other
documents that are required to be summarized or described in the
Prospectus or filed as exhibits or incorporated by reference into to
the Registration Statement by the Act or by the rules and regulations
of the Commission thereunder that have not been summarized or
described in all material respects in the Prospectus or filed as
exhibits to the Registration Statement or incorporated by reference
therein.
<PAGE> 40
(14) The statements contained in the Prospectus under the
caption "Tax Considerations," insofar as they describe federal
statutes, rules and regulations, constitute a fair summary thereof
that is accurate in all material respects; our opinion filed as
Exhibit 8 to the Registration Statement is confirmed; and the
Underwriters may rely upon such opinion as if it were addressed to
them.
(15) The Underwriting Agreement has been duly authorized,
executed and delivered by each of the EOTT Entities.
(16) The execution and delivery by each of the EOTT Entities
of the Underwriting Agreement, and the compliance by each of the EOTT
Entities with all of the provisions of the Underwriting Agreement do
not and will not, with the passage of time or upon stated contingency
or otherwise, (i) conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, (x)
any indenture, mortgage, deed of trust, loan agreement, bond,
debenture, note agreement, capital lease or other evidence of
indebtedness for borrowed money, of which we have knowledge, to which
any of the EOTT Entities is a party or by which any EOTT Entity is
bound or to which any property or assets of any EOTT Entity is
subject, (y) any contract or other agreement to which any of the EOTT
Entities is a party that restricts the ability of the Partnership to
issue securities and of which we have knowledge or (z) any document
filed as an exhibit to, or incorporated by reference in, the
Registration Statement, (ii) result in any breach or violation of the
provisions of the agreement or certificate of limited partnership or
articles of incorporation or bylaws of any such entity or (iii) result
in any breach or violation of any statute or any rule or regulation of
any governmental agency or body having jurisdiction over any such
entity or its properties that a lawyer exercising customary
professional diligence would reasonably recognize as being directly
applicable to the Partnership, any of the Operating Partnerships or
the General Partner or to the transactions contemplated by the
Underwriting Agreement, or to both, excluding in each case any
breaches or violations which, individually or in the aggregate, would
not have a material adverse effect on the limited partners or the
financial condition, results of operation, business or prospects (as
described in the Prospectus) of the Partnership and the Operating
Partnerships considered as a whole.
(17) Except as described in the Prospectus or Section 6.13 of
the Partnership Agreement and except for the registration rights
referred to in Section 4(o) of the Underwriting Agreement, to our
knowledge there are no contracts, agreements or understandings between
the Partnership, the Operating Partnerships or the General Partner and
any person granting such person the right to require the Partnership
to file a registration statement under the Act with
<PAGE> 41
respect to any securities of the Partnership or to require the
Partnership to include such securities in the securities to be
registered pursuant to the Registration Statement or in any securities
being registered pursuant to any other registration statement filed by
the Partnership under the Act.
(18) Neither the Partnership nor any of the Operating
Partnerships is an "investment company" or an "affiliated person" of,
or "promoter" or "principal underwriter" for, an "investment company,"
as such terms are defined in the Investment Company Act and the rules
and regulations thereunder, and the General Partner is either (A) not
an "investment company"or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company," as such terms
are defined in the Investment Company Act and the rules and
regulations thereunder or (B) exempt from the Investment Company Act.
(19) None of the Partnership, the Operating Partnerships or
the General Partner is a "public utility company," a "holding company"
or an "affiliate" of a holding company or a public utility company
within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
(20) No consent, approval, authorization, order, registration
or qualification of or with any federal governmental agency or body or
any governmental agency or body of the States of Texas, New York or
Delaware is required for the sale of the Common Units or the execution
and delivery of the Underwriting Agreement and the consummation by any
of the EOTT Entities of the transactions contemplated by the
Underwriting Agreement and the Prospectus, except (1) such consents,
approvals, authorizations, orders, registrations or qualifications (a)
as have been obtained, (b) as may be required under the Act or state
securities or Blue Sky laws, (c) as are of a routine or administrative
nature and either are (i) not customarily obtained or made prior to
the consummation of similar transactions or (ii) expected in our
reasonable judgment to be obtained in the ordinary course of business
subsequent to the consummation of the transactions, or (d) which, if
not obtained, would not, individually or in the aggregate, have a
material adverse effect upon the ability of the Partnership and the
Operating Partnerships taken as a whole to conduct their business as
described in the Prospectus, or (2) as described, set forth or
contemplated in the Prospectus as not having been obtained.
(21) (i) The Partnership Agreement is a valid and legally
binding agreement of the General Partner, enforceable against the
General Partner in accordance with its terms and (ii) each of the
Operating Partnership Agreements is a valid and legally binding
agreement of such parties, enforceable against the General Partner and
the Partnership in accordance with its terms, subject to the
qualifications that (A) the enforceability of each such agreement may
be limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and
<PAGE> 42
other similar laws of general applicability relating to or affecting
the rights of creditors generally, (B) the enforceability of each such
agreement may be limited by public policy, applicable law relating to
fiduciary duties and the judicial imposition of an implied covenant of
good faith and fair dealing, (C) the enforceability of equitable
rights and remedies provided for in each such agreement is subject to
equitable defenses and judicial discretion, and (D) the enforceability
of certain other provisions of each such agreement may be limited by
applicable laws and court decisions, none of which should materially
and adversely interfere with the practical realization of the material
benefits intended to be provided by such agreements.
(22) The Firm Units and the Optional Units are duly
authorized for listing, subject only to official notice of issuance,
on the New York Stock Exchange.
(23) The descriptions (i) in "Item 1. Business --
Environmental Matters" and "Item 1. Business -- Regulation" from the
Partnership's Annual Report on Form 10-K for the year ended December
31, 1998 and (ii) under "Cash Distribution Policy" and "Description of
Our Partnership Agreement" in the Prospectus, insofar as such
descriptions relate to legal matters or descriptions of the provisions
of the Partnership Agreement, are accurate and fairly present the
information required to be shown.
The opinions expressed herein are qualified in the following
respects:
(A) We have relied, without independent investigation or
verification, in respect of factual matters upon certificates of
officers of the General Partner and upon information obtained from
public officials, upon opinions of other counsel issued in connection
with the transactions (copies of which have been furnished to you and
your counsel) and other sources believed by us to be responsible.
(B) We have assumed, without independent verification, that
the certificates for the Common Units conform to the specimens thereof
examined by us and have been duly countersigned by a transfer agent
and duly registered by a registrar of the Common Units.
(C) We express no opinion with respect to state or local
taxes or tax statutes to which any of the Partnership, the limited
partners, any of the Operating Partnerships, or General Partner may be
subject.
(D) For purposes of the foregoing opinions, we have conducted
such investigation as in our judgment is necessary to enable us to
render the foregoing opinions. References herein to our knowledge
shall mean the actual knowledge of our attorneys substantially
participating in the work of this firm as
<PAGE> 43
counsel with respect to the matters relating to the transactions and
without in any manner having conducted any investigation other than as
described herein.
(E) We have assumed that (a) each document submitted to us
for review is accurate and complete, each such document that is an
original is authentic, each such document that is a copy conforms to
an authentic original and all signatures on each such document are
genuine, (b) each certificate from governmental officials reviewed by
us is accurate, complete and authentic, and all official public
records are accurate and complete, (c) all parties to the Underwriting
Agreement will act in accordance with, and will refrain from taking
any action that is forbidden by, the terms and conditions of the
Underwriting Agreement, and (d) no party to the Underwriting Agreement
will in the future take any discretionary action (including a decision
not to act) permitted under the Underwriting Agreement that would
result in a violation of law or constitute a breach or default under
any other agreement to which such party is a party or by which it or
its property is bound or under any court or administrative order,
writ, judgment or decree that names such party or is directed to it or
its property.
(F) This opinion is limited in all respects to federal laws,
the Delaware Act, the Delaware General Corporation Law, the laws of
the States of New York and Texas (excluding rules, regulations and
ordinances of counties, towns, municipalities and other special
political subdivisions of the States of New York and Texas).
(G) In giving the opinion expressed in paragraph (19) above,
we have relied upon certificates from authorized officers of the
General Partner, dated as of recent dates.
Since we have not conducted any independent investigation with regard
to the information set forth in the Registration Statement or Prospectus
(except with respect to the opinions set forth herein), we are not (except as
aforesaid) passing upon and do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained therein. We have
participated, however, in conferences with officers and other representatives
of the General Partner, representatives of the independent public accountants
of the General Partner and your representatives, at which the contents of the
Registration Statement and Prospectus and related matters were discussed. On
the basis of the foregoing (relying, as to materiality, to the extent we deem
appropriate upon the opinions of the officers and other representatives of the
General Partner), we advise you that no facts have come to our attention that
have led us to believe that the Registration Statement, at the time such
Registration Statement became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading
<PAGE> 44
or that, as of its date, the Prospectus contained an untrue statement of a
material fact or omitted a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading or that, as of the date hereof, either the
Registration Statement contains an untrue statement of a material fact or omits
to state a material fact necessary to make the statements therein not
misleading or the Prospectus contains an untrue statement of a material fact or
omits to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading. We
express no comment with respect to the financial statements and related
schedules and other financial data included or incorporated by reference in the
Registration Statement or in the Prospectus or any further amendment or
supplement thereto (including, without limitation, statements relating to
projected cash distributions to the limited partners) or any statement
contained therein or omitted therefrom in reliance upon and in conformity with
written information furnished to the Partnership by any Underwriter through you
expressly for use therein.
This opinion is furnished to the several Underwriters and is solely
for the benefit of the several Underwriters in connection with the transactions
contemplated by the Underwriting Agreement and may not be relied upon in
connection with any other transaction or by any other person or entity or
furnished to anyone else without the prior written consent of the undersigned.
Very truly yours,
<PAGE> 45
EXHIBIT D
September 29, 1999
PAINEWEBBER INCORPORATED
LEHMAN BROTHERS INC.
DAIN RAUSCHER WESSELS, A DIVISION OF DAIN RAUSCHER INCORPORATED
ING BARINGS LLC
c/o PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Ladies and Gentlemen:
This opinion is provided to you pursuant to Section 5(g) of that
certain Underwriting Agreement, dated September 23, 1999 (the "Underwriting
Agreement"), among EOTT Energy Partners, L.P., a Delaware limited partnership
(the "Partnership"), EOTT Energy Operating Limited Partnership, a Delaware
limited partnership ("Energy OLP"), EOTT Energy Pipeline Limited Partnership, a
Delaware limited partnership ("Pipeline OLP"), EOTT Energy Canada Limited
Partnership, a Delaware limited partnership ("Canada OLP"), EOTT Energy Corp.,
a Delaware corporation (the "General Partner"), and PaineWebber Incorporated,
Lehman Brothers Inc., Dain Rauscher Wessels, a Division of Dain Rauscher
Incorporated, and ING Barings LLC (the "Underwriters"). Any capitalized term
used in this opinion and not defined shall have the meaning assigned to such
term in the Underwriting Agreement. This opinion is being provided for the
closing contemplated by the Underwriting Agreement of the offer and sale of the
Firm Units (the "Closing Date").
I am Vice President and General Counsel of the General Partner, and I
have worked with the law firm of Vinson & Elkins in connection with its role as
counsel for the General Partner in connection with the offer and sale by the
Partnership of 3,500,000 Firm Units. In connection with the opinions expressed
below, I have examined such documents and records and consulted such other
sources as I have deemed necessary or advisable for purposes of the opinions
expressed below. Based on the foregoing and subject to the qualifications and
limitation set forth below, I am of the opinion that:
1. To my knowledge, each of the EOTT Entities is operating in
compliance, in all material respects, with all certificates, authorizations or
permits which have been issued by local, state, federal or foreign regulatory
agencies or bodies in connection with the business currently being operated by
it. To my knowledge, there are no certificates, authorizations or permits which
have not been obtained for any such business, where the absence of same could,
in my opinion, reasonably be expected to have, individually or in the
aggregate, a material adverse effect upon the ability of the EOTT Entities to
conduct
<PAGE> 46
their businesses in all material respects as currently conducted, and, except
as disclosed in the Prospectus, the EOTT Entities have not, to my knowledge,
received any notice of proceedings relating to the revocation or modification
of any certificate, authorization or permit which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, could, in my
opinion, reasonably be expected to have a material adverse effect upon the
ability of the EOTT Entities to conduct their businesses in all material
respects as currently conducted, and as described in the Prospectus.
2. Except as set forth to in the Prospectus, there are, to my
knowledge, no legal or governmental proceedings pending or threatened to which
any of the EOTT Entities is a party or of which any property of the EOTT
Entities is the subject which, if determined adversely, could, in my opinion,
be reasonably expected to have a material adverse effect on the consolidated
financial position, results of operations, cash flows, business or prospects of
the EOTT Entities.
3. To my knowledge, and except as otherwise set forth in the
Prospectus, the consummation of the transactions contemplated in the
Underwriting Agreement and in the Prospectus will not, with the passage of time
or upon a stated contingency or otherwise, conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which any of the EOTT Entities is a party or by
which any EOTT Entity is bound or to which any property or assets of any EOTT
Entity is subject, nor, to my knowledge, will such actions result in any
violation of the provisions of the Partnership Agreement or any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over any of the EOTT Entities or any of their properties,
excluding, in each case, any breach(es) or violation(s) which, individually or
in the aggregate, could not be reasonably expected to have a material adverse
effect on the limited partners or the financial condition, results of
operation, business or prospects (as described in the Prospectus) of the EOTT
Entities, considered as a whole.
The opinions expressed herein are qualified in the following respect:
I have relied, without independent investigation or verification, in respect of
certain factual matters upon information obtained from public officials and
other sources believed by me to be responsible.
Since I have not conducted any independent investigation with regard
to the information set forth in the Registration Statement or Prospectus, I am
not (except as expressly set forth above), passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained therein. In addition to the foregoing opinions, however, I hereby
advise you that during the course of my representation of the EOTT Entities no
facts have come to my attention that have led me to believe that the
Registration Statement, at the time such Registration Statement or any
amendments thereto became effective prior to the date hereof, contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein
<PAGE> 47
or necessary to make the statements therein not misleading, or that, as of its
date, the Prospectus or any further amendment or supplement thereto made prior
to the date hereof contained an untrue statement of a material fact or omitted
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or that, as of the date hereof, either the Registration
Statement or any further amendment thereto made prior to the date hereof,
contains an untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading or the Prospectus or any further
supplement thereto made prior to the date hereof, contains an untrue statement
of a material fact or omits to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The foregoing notwithstanding, I express no comment with
respect to the financial statements and related schedules and other financial
data included or incorporated by reference in the Registration Statement or in
the Prospectus or any further amendment or supplement thereto (including,
without limitation, statements relating to income, profits, cash flows and
projected cash distributions to the limited partners of the Partnership) or any
statement contained therein or omitted therefrom in reliance upon and in
conformity with written information furnished to the Partnership by you
expressly for use therein.
This opinion is furnished to the several underwriters and is solely
for the benefit of the several underwriters in connection with the transactions
contemplated by the Underwriting Agreement and may not be relied upon in
connection with any other transaction or by any other person or entity or
furnished to anyone else without the prior written consent of the undersigned.
Very truly yours,
<PAGE> 1
EXHIBIT 3.1
AMENDMENT NO. 6 TO
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
EOTT ENERGY PARTNERS, L.P.
THIS AMENDMENT NO. 6 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF EOTT ENERGY PARTNERS, L.P. (this "Amendment"), dated as of
September 16, 1999, is entered into by EOTT Energy Corp., a Delaware
corporation, as the General Partner, pursuant to authority granted to it in
Section 15.1(d) of the Amended and Restated Agreement of Limited Partnership of
EOTT Energy Partners, L.P., dated as of March 25, 1994 (the "Partnership
Agreement").
WHEREAS, Section 15.1(d)(i) of the Partnership Agreement provides that
each Limited Partner agrees that the General Partner (pursuant to its powers of
attorney from the Limited Partners and Assignees), without the approval of any
Limited Partner or Assignee, may amend any provision of the Partnership
Agreement, and may execute, swear to, acknowledge, deliver, file and record
whatever documents may be required in connection therewith, to reflect a change
that, in the sole discretion of the General Partner, does not adversely affect
the Limited Partners in any material respect; and
WHEREAS, the General Partner has determined that the change reflected
in this Amendment will be beneficial to the Limited Partners, including the
holders of the Common Units;
NOW, THEREFORE, the Partnership Agreement is hereby amended as follows:
1. AMENDMENT RELATING TO DEFINITION OF CASH FROM OPERATIONS Article II
of the Partnership Agreement is hereby amended by changing subparagraph (b)(ii)
of the definition of Cash from Operations to read as follows :
"(ii) all cash debt service payments of the Partnership and the
Operating Partnerships during such period (other than payments or
prepayments of principal and premium required by reason of loan
agreements (including, without limitation, covenants and default
provisions therein) or by lenders, in each case in connection with
sales or other dispositions of assets or made in connection with
refinancings or refundings of indebtedness, provided, that any payment
or prepayment of principal, whether or not then due, shall be deemed,
at the election and in the discretion of the General Partner, to be
refunded or refinanced by any indebtedness or equity incurred or issued
or to be incurred or issued by the Partnership or the Operating
Partnerships simultaneously with or within 180 days prior to or after
such payment or prepayment to the extent of the principal amount of
such indebtedness so incurred or the net proceeds from such equity
issued),"
2. CAPITALIZED TERMS. Capitalized terms used but not defined herein are
used as defined in the Partnership Agreement. This Amendment will be governed by
and construed in accordance with the laws of the State of Delaware.
<PAGE> 2
IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.
GENERAL PARTNER:
EOTT ENERGY CORP.
By: /s/ Michael D. Burke
--------------------------------------
Michael D. Burke
President and Chief Executive Officer
LIMITED PARTNERS:
All Limited Partners now and hereafter
admitted as limited partners of the
Partnership, pursuant to Powers of
Attorney now and hereafter executed in
favor of, and granted and delivered to,
the General Partner.
By: EOTT Energy Corp.,
General Partner, as attorney-in-fact
for all Limited Partners pursuant
to the Powers of Attorney granted
pursuant to Section 1.4.
By: /s/ Michael D. Burke
---------------------------------
Michael D. Burke
President and Chief Executive Officer
<PAGE> 1
EXHIBIT 3.2
AMENDMENT NO. 1 TO
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
EOTT ENERGY OPERATING LIMITED PARTNERSHIP
THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF EOTT ENERGY OPERATING LIMITED PARTNERSHIP (this "Amendment"),
dated as of September 1, 1999, is entered into by EOTT Energy Corp., a Delaware
corporation, as the General Partner, pursuant to authority granted to it in
Section 14.1(d) of the Amended and Restated Agreement of Limited Partnership of
EOTT Energy Operating Limited Partnership dated as of March 24, 1994 (the
"Partnership Agreement").
WHEREAS, Section 14.1(d)(i) of the Partnership Agreement provides that
the Limited Partner agrees that the General Partner (pursuant to its powers of
attorney from the Limited Partner), without the approval of the Limited Partner,
may amend any provision of the Partnership Agreement, and may execute, swear to,
acknowledge, deliver, file and record whatever documents may be required in
connection therewith, to reflect a change that, in the sole discretion of the
General Partner, does not adversely affect the Limited Partner in any material
respect; and
WHEREAS, the General Partner has determined that the changes reflected
in this Amendment will be beneficial to the Limited Partner;
NOW, THEREFORE, the Partnership Agreement is hereby amended as follows:
1. AMENDMENT RELATING TO DUTIES OF GENERAL PARTNER. Section 6.1 of the
Partnership Agreement is hereby amended by replacing the first sentence thereof
with the following:
"Subject to the other provisions of this Agreement, the General Partner
shall conduct, direct and manage all activities of the Partnership in a
manner that the General Partner determines is in the best interest of
the MLP."
2. AMENDMENT RELATING TO REMOVAL OF GENERAL PARTNER. Section 12.2 of
the Partnership Agreement is hereby amended by deleting Section 12.2 and
replacing it with the following:
"12.2 REMOVAL OF A GENERAL PARTNER.
(a) A General Partner shall be removed if such General Partner is
removed as a general partner of the MLP pursuant to Section 13.2 of
the MLP Agreement. Such removal shall be effective concurrently with
the effectiveness of the removal of such General Partner as a
general partner of the MLP pursuant to the terms of the MLP
Agreement. If a successor General Partner is elected in connection
with the removal of such General Partner as a general partner of the
MLP, such successor General Partner shall, upon admission pursuant
to Article XI, automatically become a successor General Partner of
the Partnership. The admission of any such successor General Partner
to the Partnership shall be subject to the provisions of Section
11.3
<PAGE> 2
(b) A General Partner shall be removed if the MLP, in its sole
discretion, approves the removal. Any action by the MLP to remove
the General Partner as provided in this Section 12.2(b) must also
provide for the election of a successor General Partner by the MLP.
Removal of the General Partner shall be effective immediately
following the admission of a successor General Partner pursuant to
Article XI. The admission of any such successor General Partner to
the Partnership shall be subject to the provisions of Section 11.3."
3. AMENDMENT RELATING TO ABILITY OF GENERAL PARTNER TO AMEND THE
PARTNERSHIP AGREEMENT. Section 14.1(b) of the Partnership Agreement is hereby
amended to read as follows:
"(b) admission, substitution, withdrawal or removal of Partners in
accordance with this Agreement, other than any amendment that would
eliminate the right of the MLP to remove and replace a General Partner,
as provided in Section 12.2(b);"
4. CAPITALIZED TERMS. Capitalized terms used but not defined herein are
used as defined in the Partnership Agreement. This Amendment will be governed by
and construed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.
GENERAL PARTNER:
EOTT ENERGY CORP.
By: /s/ Michael D. Burke
-------------------------------------------
Michael D. Burke
President and Chief Executive Officer
LIMITED PARTNER:
The Limited Partner, pursuant to Powers of
Attorney now and hereafter executed in favor
of, and granted and delivered to, the General
Partner.
By: EOTT Energy Corp.,
General Partner, as attorney-in-fact for
the Limited Partner pursuant to the
Powers of Attorney granted pursuant to
Section 1.4.
By: /s/ Michael D. Burke
-------------------------------------
Michael D. Burke
President and Chief Executive Officer
2
<PAGE> 1
EXHIBIT 3.3
AMENDMENT NO. 1 TO
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
EOTT ENERGY PIPELINE LIMITED PARTNERSHIP
THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF EOTT ENERGY PIPELINE LIMITED PARTNERSHIP (this "Amendment"),
dated as of September 1, 1999, is entered into by EOTT Energy Corp., a Delaware
corporation, as the General Partner, pursuant to authority granted to it in
Section 14.1(d) of the Amended and Restated Agreement of Limited Partnership of
EOTT Energy Pipeline Limited Partnership dated as of March 24, 1994 (the
"Partnership Agreement").
WHEREAS, Section 14.1(d)(i) of the Partnership Agreement provides that
the Limited Partner agrees that the General Partner (pursuant to its powers of
attorney from the Limited Partner), without the approval of the Limited Partner,
may amend any provision of the Partnership Agreement, and may execute, swear to,
acknowledge, deliver, file and record whatever documents may be required in
connection therewith, to reflect a change that, in the sole discretion of the
General Partner, does not adversely affect the Limited Partner in any material
respect; and
WHEREAS, the General Partner has determined that the changes reflected
in this Amendment will be beneficial to the Limited Partner;
NOW, THEREFORE, the Partnership Agreement is hereby amended as follows:
1. AMENDMENT RELATING TO DUTIES OF GENERAL PARTNER. Section 6.1 of the
Partnership Agreement is hereby amended by replacing the first sentence thereof
with the following:
"Subject to the other provisions of this Agreement, the General Partner
shall conduct, direct and manage all activities of the Partnership in a
manner that the General Partner determines is in the best interest of
the MLP."
2. AMENDMENT RELATING TO REMOVAL OF GENERAL PARTNER. Section 12.2 of
the Partnership Agreement is hereby amended by deleting Section 12.2 and
replacing it with the following:
"12.2 REMOVAL OF A GENERAL PARTNER.
(a) A General Partner shall be removed if such General Partner is
removed as a general partner of the MLP pursuant to Section 13.2 of
the MLP Agreement. Such removal shall be effective concurrently with
the effectiveness of the removal of such General Partner as a
general partner of the MLP pursuant to the terms of the MLP
Agreement. If a successor General Partner is elected in connection
with the removal of such General Partner as a general partner of the
MLP, such successor General Partner shall, upon admission pursuant
to Article XI, automatically become a successor General Partner of
the Partnership. The admission of any such successor General Partner
to the Partnership shall be subject to the provisions of Section
11.3
<PAGE> 2
(b) A General Partner shall be removed if the MLP, in its sole
discretion, approves the removal. Any action by the MLP to remove
the General Partner as provided in this Section 12.2(b) must also
provide for the election of a successor General Partner by the MLP.
Removal of the General Partner shall be effective immediately
following the admission of a successor General Partner pursuant to
Article XI. The admission of any such successor General Partner to
the Partnership shall be subject to the provisions of Section 11.3."
3. AMENDMENT RELATING TO ABILITY OF GENERAL PARTNER TO AMEND THE
PARTNERSHIP AGREEMENT. Section 14.1(b) of the Partnership Agreement is hereby
amended to read as follows:
"(b) admission, substitution, withdrawal or removal of
Partners in accordance with this Agreement, other than any amendment
that would eliminate the right of the MLP to remove and replace a
General Partner, as provided in Section 12.2(b);"
4. CAPITALIZED TERMS. Capitalized terms used but not defined herein are
used as defined in the Partnership Agreement. This Amendment will be governed by
and construed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.
GENERAL PARTNER:
EOTT ENERGY CORP.
By: /s/ Michael D. Burke
------------------------------------------
Michael D. Burke
President and Chief Executive Officer
LIMITED PARTNER:
The Limited Partner, pursuant to Powers of Attorney
now and hereafter executed in favor of, and granted
and delivered to, the General Partner.
By: EOTT Energy Corp.,
General Partner, as attorney-in-fact for the
Limited Partner pursuant to the Powers of
Attorney granted pursuant to Section 1.4.
By: /s/ Michael D. Burke
--------------------------------
Michael D. Burke
President and Chief Executive Officer
2
<PAGE> 1
EXHIBIT 3.4
AMENDMENT NO. 1 TO
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF
EOTT ENERGY CANADA LIMITED PARTNERSHIP
THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED AGREEMENT OF LIMITED
PARTNERSHIP OF EOTT ENERGY CANADA LIMITED PARTNERSHIP (this "Amendment"), dated
as of September 1, 1999, is entered into by EOTT Energy Corp., a Delaware
corporation, as the General Partner, pursuant to authority granted to it in
Section 14.1(d) of the Amended and Restated Agreement of Limited Partnership of
EOTT Energy Canada Limited Partnership dated as of March 24, 1994 (the
"Partnership Agreement").
WHEREAS, Section 14.1(d)(i) of the Partnership Agreement provides that
the Limited Partner agrees that the General Partner (pursuant to its powers of
attorney from the Limited Partner), without the approval of the Limited Partner,
may amend any provision of the Partnership Agreement, and may execute, swear to,
acknowledge, deliver, file and record whatever documents may be required in
connection therewith, to reflect a change that, in the sole discretion of the
General Partner, does not adversely affect the Limited Partner in any material
respect; and
WHEREAS, the General Partner has determined that the changes reflected
in this Amendment will be beneficial to the Limited Partner;
NOW, THEREFORE, the Partnership Agreement is hereby amended as follows:
1. AMENDMENT RELATING TO DUTIES OF GENERAL PARTNER. Section 6.1 of the
Partnership Agreement is hereby amended by replacing the first sentence thereof
with the following:
"Subject to the other provisions of this Agreement, the General Partner
shall conduct, direct and manage all activities of the Partnership in a
manner that the General Partner determines is in the best interest of
the MLP."
2. AMENDMENT RELATING TO REMOVAL OF GENERAL PARTNER. Section 12.2 of
the Partnership Agreement is hereby amended by deleting Section 12.2 and
replacing it with the following:
"12.2 REMOVAL OF A GENERAL PARTNER.
(a) A General Partner shall be removed if such General Partner is
removed as a general partner of the MLP pursuant to Section 13.2 of
the MLP Agreement. Such removal shall be effective concurrently with
the effectiveness of the removal of such General Partner as a
general partner of the MLP pursuant to the terms of the MLP
Agreement. If a successor General Partner is elected in connection
with the removal of such General Partner as a general partner of the
MLP, such successor General Partner shall, upon admission pursuant
to Article XI, automatically become a successor General Partner of
the Partnership. The admission of any such successor General Partner
to the Partnership shall be subject to the provisions of Section
11.3
<PAGE> 2
(b) A General Partner shall be removed if the MLP, in its sole
discretion, approves the removal. Any action by the MLP to remove
the General Partner as provided in this Section 12.2(b) must also
provide for the election of a successor General Partner by the MLP.
Removal of the General Partner shall be effective immediately
following the admission of a successor General Partner pursuant to
Article XI. The admission of any such successor General Partner to
the Partnership shall be subject to the provisions of Section 11.3."
3. AMENDMENT RELATING TO ABILITY OF GENERAL PARTNER TO AMEND THE
PARTNERSHIP AGREEMENT. Section 14.1(b) of the Partnership Agreement is hereby
amended to read as follows:
"(b) admission, substitution, withdrawal or removal of
Partners in accordance with this Agreement, other than any amendment
that would eliminate the right of the MLP to remove and replace a
General Partner, as provided in Section 12.2(b);"
4. CAPITALIZED TERMS. Capitalized terms used but not defined herein are
used as defined in the Partnership Agreement. This Amendment will be governed by
and construed in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, this Amendment has been executed as of the date
first written above.
GENERAL PARTNER:
EOTT ENERGY CORP.
By: /s/ Michael D. Burke
----------------------------------------------
Michael D. Burke
President and Chief Executive Officer
LIMITED PARTNER:
The Limited Partner, pursuant to Powers of
Attorney now and hereafter executed in favor of,
and granted and delivered to, the General Partner.
By: EOTT Energy Corp.,
General Partner, as attorney-in-fact for the
Limited Partner pursuant to the Powers of
Attorney granted pursuant to Section 1.4.
By: /s/ Michael D. Burke
-----------------------------------------
Michael D. Burke
President and Chief Executive Officer
2
<PAGE> 1
EXHIBIT 12.1
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION> PRO FORMA
SIX MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30, YEAR ENDED DECEMBER 31,
---------------- ----------------- -----------------------------------------------------
1999 1999 1998 1998 1997 1996 1995 1994
------ ------- ------- ------- -------- ------- -------- -----------
(PRO FORMA)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
EARNINGS:
Net Income (Loss)............ $ 4,270 $ 6,463 $(2,997) $(4,067) $(14,399) $28,809 $(61,433) $19,688
Add:
(Income) Loss from
discontinued
operations............ -- -- -- -- -- -- 65,838 (4,809)
Extraordinary loss...... -- -- -- -- -- -- 1,315 --
Cumulative effect of
accounting change..... (1,747) (1,747) -- -- -- -- -- --
Fixed Charges........... 17,315 15,622 5,323 13,803 10,094 7,092 6,530 5,909
Less:
Capitalized interest.... -- -- -- -- -- -- -- --
------- ------- ------- ------- -------- ------- -------- -------
Total earnings............. $20,338 $20,338 $ 2,326 $ 9,736 $ (4,305) $35,901 $ 12,250 $20,788
======= ======= ======= ======= ======== ======= ======== =======
FIXED CHARGES
Interest expenses............ $15,513 $13,820 $ 3,823 $10,165 $ 6,661 $ 3,659 $ 3,930 $ 4,176
Portion of rental expense
representing interest...... 1,802 1,802 1,500 3,638 3,433 3,433 2,600 1,733
------- ------- ------- ------- -------- ------- -------- -------
Total fixed charges........ $17,315 $15,622 $ 5,323 $13,803 $ 10,094 $ 7,092 $ 6,530 $ 5,909
======= ======= ======= ======= ======== ======= ======== =======
RATIO OF EARNINGS TO FIXED
CHARGES(1)................. $ 1.17 $ 1.30 N/A N/A N/A $ 5.06 $ 1.88 $ 3.52
======= ======= ======= ======= ======== ======= ======== =======
</TABLE>
- ---------------
(1) Earnings were insufficient to cover fixed charges for the six months ended
June 30, 1998 by $2,997,000 and for the years ended December 31, 1998 and
1997 by $4,067,000 and $14,399,000, respectively.
