Exhibit 1(A)
$
TEXAS EASTERN TRANSMISSION, LP
% Notes due
UNDERWRITING AGREEMENT
,
Ladies and Gentlemen:
1. Introductory. TEXAS EASTERN TRANSMISSION, LP, a Delaware limited
partnership ("Company"), proposes, subject to the terms and conditions stated
herein, to issue and sell $ aggregate principal amount of %
Notes due ("Notes"), to be issued pursuant to the provisions of an
Indenture, dated as of December 1, 2000, between the Company and The Chase
Manhattan Bank, as supplemented (the "Indenture"), and hereby agrees with the
several Underwriters hereinafter named in Schedule A ("Underwriters") as
follows:
2. Representations and Warranties of the Company. The Company represents and
warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333- ), including a prospectus, relating
to the Notes has been filed with the Securities and Exchange Commission
("Commission") under the Securities Act of 1933, as amended (the "1933 Act").
Such registration statement and any post-effective amendment thereto, each in
the form heretofore delivered to you, and, excluding exhibits thereto but
including all documents incorporated by reference in the prospectus contained
therein, to you for each of the other Underwriters, have been declared
effective by the Commission in such form, and no stop order suspending the
effectiveness of such registration statement has been issued and no proceeding
for that purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such registration statement or filed with
the Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the 1933 Act ("1933 Act Regulations") being hereinafter
called a "Preliminary Prospectus"; the various parts of such registration
statement, including all exhibits thereto and including the documents
incorporated by reference in the prospectus contained in the registration
statement at the time such part of the registration statement became
effective, each as amended at the time such part of the registration statement
became effective, being hereinafter called the "Registration Statement"; and
the final prospectus relating to the Notes, in the form first filed pursuant
to Rule 424(b) under the 1933 Act Regulations, being hereinafter called the
"Prospectus"; and any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein, as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or supplement
to any Preliminary Prospectus or Prospectus shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), and
incorporated by reference in such Preliminary Prospectus or Prospectus, as the
case may be; and any reference to any amendment to the Registration Statement
shall be deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the 1934 Act after the effective date of
the Registration Statement that is incorporated by reference in the
Registration Statement).
(b) The Registration Statement conforms in all material respects to the
requirements of the 1933 Act and the 1933 Act Regulations, and the Registration
Statement does not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading; the Prospectus will conform in all material
respects to the requirements of the 1933 Act and the 1933 Act Regulations, and
the Prospectus will not include any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, except that the Company makes no warranty or
representation to the Underwriters in this subsection with respect to any
statements or omissions in any such document based upon written information
furnished to the Company by any Underwriter specifically for use therein.
(c) The documents incorporated by reference in the Prospectus, at the time they
were filed with the Commission, complied in all material respects with the
requirements of the 1934 Act and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), and, when read together with the other
information in the Prospectus, do 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 statements therein, in the light of the circumstances
under which they were made, not misleading, and any documents deemed to be
incorporated by reference in the Prospectus will, when they are filed with the
Commission, comply in all material respects with the requirements of the 1934
Act and the 1934 Act 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 statements therein, in the light of the circumstances
under which they were made, not misleading, except that the Company makes no
warranty or representation to the Underwriters with respect to any statements
or omissions made in reliance upon and in conformity with written information
furnished to the Company by any Underwriter specifically for use therein.
(d) The compliance by the Company with all of the provisions of this Agreement
and the consummation of the transactions herein contemplated will not 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 the Company is a party or
by which it or its property is bound or to which any of its property or assets
is subject that would have a material adverse effect on the business, financial
condition or results of operations of the Company and its subsidiaries, taken
as a whole, nor will such action result in any violation of the provisions of
the Limited Partnership Agreement of the Company or result in any violation of
any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its property that
would have a material adverse effect on the business, financial condition or
results of operations of the Company and its subsidiaries, taken as a whole;
and no consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is required for the
consummation by the Company of the
2
transactions contemplated by this Agreement, except for the registration under
the 1933 Act of the Notes, qualification under the Trust Indenture Act of 1939
and such consents, approvals, authorizations, registrations or qualifications
as may be required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Notes by the Underwriters.
3. Purchase, Sale and Delivery of Notes. On the basis of the representations,
warranties and agreements herein contained, but subject to the terms and
conditions herein set forth, the Company agrees to sell to the Underwriters,
and the Underwriters agree, severally and not jointly, to purchase from the
Company at a purchase price of % of the principal amount of the Notes, the
respective principal amount of Notes set forth opposite the names of the
Underwriters in Schedule A hereto plus the respective principal amount of
additional Notes which each such Underwriter may become obligated to purchase
pursuant to the provisions of Section 8 hereof.
Payment of the purchase price for the Notes to be purchased by the Underwriters
shall be made at the offices of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, 1301 Avenue of the
Americas, New York, N.Y., or at such other place as shall be mutually agreed
upon by you and the Company, at 10:00 a.m., New York City time, on ,
(unless postponed in accordance with the provisions of Section 8) or such other
time and date as shall be agreed upon by you and the Company (the "Closing
Date"). Payment shall be made to the Company by wire transfer in immediately
available funds, payable to the order of the Company against delivery of the
Notes, in fully registered form, to you or upon your order. The Notes shall be
delivered in the form of one or more global certificates in aggregate
denomination equal to the aggregate principal amount of the Notes upon original
issuance and registered in the name of Cede & Co., as nominee for The
Depository Trust Company ("DTC").
4. Offering by the Underwriters. It is understood that the several Underwriters
propose to offer the Notes for sale to the public as set forth in the
Prospectus.
5. Covenants of the Company. The Company covenants and agrees with the several
Underwriters that:
(a) The Company will advise you promptly of the filing of any amendment (and
effectiveness thereof) or supplementation of the Registration Statement or the
Prospectus, of the filing of any Rule 462(b) registration statement and of the
institution by the Commission of any stop order proceedings in respect of the
Registration Statement, and will use its best efforts to prevent the issuance
of any such stop order and to obtain as soon as possible its lifting, if
issued.
(b) If at any time when a prospectus relating to the Notes is required to be
delivered under the 1933 Act any event occurs as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact, or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the Prospectus
to comply with the 1933 Act, the Company promptly will prepare and file with
the Commission an amendment, supplement or an appropriate document pursuant to
Section 13 or 14 of the 1934 Act which will correct such statement or omission
or which will effect such compliance.
(c) The Company, during the period when a prospectus relating to the Notes is
required to be delivered under the 1933 Act, will timely file all documents
required to be filed with the Commission pursuant to Section 13 or 14 of the
1934 Act.
3
(d) The Company will make generally available to its security holders, in each
case as soon as practicable but not later than 60 days after the close of the
period covered thereby, earning statements (in form complying with the
provisions of Section 11(a) of the 1933 Act, which need not be certified by
independent certified public accountants unless required by the 1933 Act)
covering (i) a twelve-month period beginning not later than the first day of
the Company's fiscal quarter next following the effective date of the
Registration Statement and (ii) a twelve-month period beginning not later than
the first day of the Company's fiscal quarter next following the date of this
Agreement.
(e) The Company will furnish to you, without charge, copies of the Registration
Statement ( of which will be signed and will include all exhibits other than
those incorporated by reference), the Prospectus, and all amendments and
supplements to such documents, in each case as soon as available and in such
quantities as you reasonably request.
(f) The Company will arrange or cooperate in arrangements for the qualification
of the Notes for sale under the laws of such jurisdictions as you designate and
will continue such qualifications in effect so long as required for the
distribution; provided, however, that the Company shall not be required to
qualify as a foreign corporation or to file any general consents to service of
process under the laws of any state where it is not now so subject.
(g) The Company will pay all expenses incident to the performance of its
obligations under this Agreement including (i) the printing and filing of the
Registration Statement and the printing of this Agreement and any Blue Sky
Survey, (ii) the issuance and delivery of the Notes as specified herein, (iii)
the fees and disbursements of counsel for the Underwriters in connection with
the qualification of the Notes under the securities laws of any jurisdiction in
accordance with the provisions of Section 5(f) and in connection with the
preparation of the Blue Sky Survey, such fees not to exceed $7,500, (iv) the
printing and delivery to the Underwriters, in quantities as hereinabove
referred to, of copies of the Registration Statement and any amendments
thereto, and of the Prospectus and any amendments or supplements thereto, (v)
any fees charged by independent rating agencies for rating the Notes, (vi) any
fees and expenses in connection with any listing of the Notes on the New York
Stock Exchange, (vii) any filing fee required by the National Association of
Securities Dealers, Inc., (viii) the costs of any depository arrangements for
the Notes with DTC or any successor depositary and (ix) the costs and expenses
of the Company relating to investor presentations on any "road show" undertaken
in connection with the marketing of the offering of the Notes, including,
without limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in connection with
the road show presentations with the prior approval of the Company, travel and
lodging expenses of and officers of the Company and any such
consultants, and the cost of any aircraft chartered in connection with the road
show; provided, however, the Underwriters shall reimburse a portion of the
costs and expenses referred to in this clause (ix).
6. Conditions of the Obligations of the Underwriters. The obligations of the
several Underwriters to purchase and pay for the Notes will be subject to the
accuracy of the representations and warranties on the part of the Company
herein, to the accuracy of the statements of officers of the Company made
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
4
(a) Prior to the Closing Date, no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or, to the knowledge of the Company or you,
shall be threatened by the Commission.
(b) Prior to the Closing Date, the rating assigned by ▇▇▇▇▇'▇ Investors
Service, Inc. or Standard & Poor's Ratings Services to any debt securities of
the Company as of the date of this Agreement shall not have been lowered.
(c) Since the respective most recent dates as of which information is given in
the Prospectus and up to the Closing Date, there shall not have been any
material adverse change in the condition of the Company, financial or
otherwise, except as reflected in or contemplated by the Prospectus, and, since
such dates and up to the Closing Date, there shall not have been any material
transaction entered into by the Company other than transactions contemplated by
the Prospectus and transactions in the ordinary course of business, the effect
of which in your judgment is so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Notes on the terms and in the manner contemplated by the
Prospectus.
(d) You shall have received an opinion or opinions of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP,
counsel to the Company, dated the Closing Date, to the effect that:
(i) The Company has been duly organized and is validly existing as a limited
partnership in good standing under the laws of the State of Delaware, with
power and authority to own its properties and conduct its business as described
in the Prospectus and to enter into and perform its obligations under this
Agreement.
(ii) The Registration Statement has become effective under the 1933 Act, and,
to the best of the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or threatened under the
1933 Act.
(iii) The Registration Statement as of the date of effectiveness under the 1933
Act and the Prospectus as of the date it was filed with, or transmitted for
filing to, the Commission complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations; and nothing has come
to their attention that would lead them to believe that the Registration
Statement as of the date of effectiveness under the 1933 Act (or if an
amendment to such Registration Statement or an annual report on Form 10-K has
been filed by the Company with the Commission subsequent to the effectiveness
of the Registration Statement, then at the time of the most recent such filing)
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus as of the date it was filed with, or
transmitted for filing to, the Commission and at the Closing Date contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. Such opinion
may state that such counsel do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in or incorporated by
reference into the Registration Statement and the Prospectus except as
otherwise expressly provided in such opinion and do not express any opinion or
belief as to the financial statements or other financial data contained in or
incorporated by reference into the Registration Statement and the Prospectus,
the statement of the eligibility and qualification of the Trustee or as to
5
the information set forth in the Prospectus under the caption "Description of
the % Notes due --Book-Entry Only Issuance--The Depository Trust Company."
(iv) The statements made in the Prospectus under the captions "Description of
the Notes" and "Description of the % Notes due ," insofar as they purport
to summarize provisions of documents specifically referred to therein, fairly
present the information called for with respect thereto by Form S-3.
(v) This Agreement has been duly authorized, executed and delivered by the
Company.
(vi) The performance by the Company of this Agreement and the Indenture will
not contravene any of the provisions of the Limited Partnership Agreement of
the Company, nor will such performance contravene any statute or any order,
rule or regulation of which such counsel is aware of any court or governmental
agency or body having jurisdiction over the Company or any of its property, nor
will such action 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 known to such
counsel to which the Company is a party or by which it or its property is bound
or to which its property or assets is subject which affects in a material way
the Company's ability to perform its obligations under this Agreement and the
Indenture.
(vii) No consent, approval, authorization, order, registration or qualification
of or with any court or governmental agency or body is required for the issue
and sale of the Notes or the consummation by the Company of the transactions
contemplated by this Agreement or the Indenture, except such as have been
obtained under the 1933 Act and the Trust Indenture Act of 1939 and such
consents, approvals, authorizations, orders, registrations or qualifications as
may be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Notes by the Underwriters.
(viii) The Indenture has been duly authorized, executed and delivered by the
Company and duly qualified under the Trust Indenture Act of 1939 and, assuming
the due authorization, execution and delivery thereof by The Chase Manhattan
Bank, as Trustee, constitutes a valid and legally binding instrument of the
Company, enforceable against the Company in accordance with its terms, subject
to the qualifications that the enforceability of the Company's obligations
under the Indenture may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
(ix) The Notes have been duly authorized and executed by the Company and, when
authenticated by The Chase Manhattan Bank, as Trustee, in the manner provided
in the Indenture and delivered against payment therefor, will constitute valid
and legally binding obligations of the Company, enforceable against the Company
in accordance with their terms, subject to the qualifications that the
enforceability of the Company's obligations under the Notes may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), and are entitled to the benefits afforded by
the Indenture in accordance with the terms of the Indenture and the Notes.
In rendering the foregoing opinion or opinions, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP may state
that such opinion or opinions are limited to the federal laws of the United
States, the laws of the State of New York and
6
the Revised Uniform Limited Partnership Act of the State of Delaware, and that
they are expressing no opinion as to the effect of the laws of any other
jurisdiction. In addition, such counsel may state that they have relied as to
certain factual matters on information obtained from public officials, officers
of the Company and other sources believed by them to be responsible and that
the signatures on all documents examined by them are genuine, assumptions which
such counsel have not independently verified.
(e) You shall have received an opinion, dated the Closing Date, of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇, Esq. to the effect that:
(i) The Company is duly qualified to do business in each jurisdiction in which
the ownership or leasing of its property or the conduct of its business
requires such qualification, except where the failure to so qualify,
considering all such cases in the aggregate, does not have a material adverse
effect on the business, properties, financial position or results of operations
of the Company and its subsidiaries taken as a whole.
(ii) The descriptions in the Registration Statement and the Prospectus of legal
or governmental proceedings are accurate and fairly present the information
required to be shown, and such counsel does not know of any litigation or any
legal or governmental proceeding instituted or threatened against the Company
or any of its subsidiaries or any of their respective properties that would be
required to be disclosed in the Prospectus and is not so disclosed.
Such counsel shall also state that nothing has come to his attention that has
caused him to believe that the Registration Statement as of the date of
effectiveness under the 1933 Act and the Prospectus as of the date it was filed
with, or transmitted for filing to, the Commission, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus as of the date it was filed with, or transmitted for filing
to, the Commission and at the Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Such counsel may also
state that, except as otherwise expressly provided in such opinion, he does not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in or incorporated by reference into the Registration
Statement and the Prospectus and does not express any opinion or belief as to
the financial statements or other financial data contained in or incorporated
by reference into the Registration Statement and the Prospectus, the statement
of the eligibility and qualification of the Trustee or as to the information
set forth in the Prospectus under the caption "Description of the % Notes due
--Book-Entry Only Issuance--The Depository Trust Company."
In rendering the foregoing opinion, such counsel may rely, to the extent
recited therein, upon opinions of local counsel. Such counsel may also state
that he has relied as to certain factual matters on information obtained from
public officials, officers of the Company and other sources believed by him to
be responsible.
(f) You shall have received the opinion and letter of , counsel for
the Underwriters, dated the Closing Date, with respect to the organization of
the Company, the validity of the Notes, the Registration Statement and the
Prospectus, as amended or supplemented, and such
7
other related matters as you may require, and the Company shall have furnished
to such counsel such documents as they request for the purpose of enabling them
to pass upon such matters.
(g) On or after the date hereof, there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally or of the securities of Duke Energy Corporation, Duke Capital
Corporation or the Company on the New York Stock Exchange; or (ii) a general
moratorium on commercial banking activities in New York declared by either
Federal or New York State authorities; or (iii) the outbreak or material
escalation of hostilities involving the United States or the declaration by the
United States of a national emergency or war if the effect of any such event
specified in this subsection (g) in your judgment makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Notes on
the terms and in the manner contemplated in the Prospectus. In such event there
shall be no liability on the part of any party to any other party except as
otherwise provided in Section 7 hereof and except for the expenses to be borne
by the Company as provided in Section 5(g) hereof.
(h) You shall have received a certificate of the Chairman, the President, any
Vice President, the Secretary or an Assistant Secretary and any financial or
accounting officer of the Company, dated the Closing Date, in which such
officers, to the best of their knowledge after reasonable investigation, shall
state that the representations and warranties of the Company in this Agreement
are true and correct as of the Closing Date, that the Company has complied with
all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date, that the conditions specified in
Section 6(b) and Section 6(c) have been satisfied, and that no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are threatened by the
Commission.
(i) On the date of this Agreement, you shall have received a letter dated the
date hereof, in form and substance satisfactory to you, from the Company's
independent public accountants, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in or incorporated by reference into the Prospectus.
(j) At the Closing Date you shall have received from the Company's independent
public accountants a letter, dated the Closing Date, to the effect that such
accountants reaffirm the statements made in the letter furnished pursuant to
paragraph (i) of this Section 6, except that the specified date referred to
shall be a date not more than three business days prior to the Closing Date.
The Company will furnish you with such conformed copies of such opinions,
certificates, letters and documents as you reasonably request.
7. Indemnification. (a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act, as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever
arising out of any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any amendment thereto), or the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or arising
out of any untrue statement or alleged untrue statement of a material fact
contained in any
8
Preliminary Prospectus, the prospectus constituting a part of the Registration
Statement in the form in which it became effective or the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, unless
such statement or omission or such alleged statement or omission was made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through you expressly for use in the Registration
Statement (or any amendment thereto) or such Preliminary Prospectus, such
prospectus, or the Prospectus (or any amendment or supplement thereto);
(ii) against any and all loss, liability, claim, damage and expense whatsoever
to the extent of the aggregate amount paid in settlement of any litigation,
commenced or threatened, or of any claim whatsoever based upon any such untrue
statement or omission or any such alleged untrue statement or omission, if such
settlement is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under (i) or (ii) of this Section 7.
In no case shall the Company be liable under this indemnity agreement with
respect to any claim made against any Underwriter or any such controlling
person unless the Company shall be notified in writing of the nature of the
claim within a reasonable time after the assertion thereof, but failure so to
notify the Company shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. The Company shall be
entitled to participate at its own expense in the defense, or, if it so elects,
within a reasonable time after receipt of such notice, to assume the defense of
any suit brought to enforce any such claim, but if it so elects to assume the
defense, such defense shall be conducted by counsel chosen by it and approved
by the Underwriter or Underwriters or controlling person or persons, or
defendant or defendants in any suit so brought, which approval shall not be
unreasonably withheld. In any such suit, any Underwriter or any such
controlling person shall have the right to employ its own counsel, but the fees
and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Company and such Underwriter shall have
mutually agreed to the employment of such counsel, or (ii) the named parties to
any such action (including any impleaded parties) include both such Underwriter
or such controlling person and the Company and such Underwriter or such
controlling person shall have been advised by such counsel that a conflict of
interest between the Company and such Underwriter or such controlling person
may arise and for this reason it is not desirable for the same counsel to
represent both the indemnifying party and also the indemnified party (it being
understood, however, that the Company shall not, in connection with any one
such action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the reasonable fees and expenses of more than one separate firm
of attorneys for all such Underwriters and all such controlling persons, which
firm shall be designated in writing by you). The Company agrees to notify you
within a reasonable time of the assertion of any claim against it, any of its
officers or directors or any person who controls the Company within the meaning
of Section 15 of the 1933 Act, in connection with the sale of the Notes.
9
(b) Each Underwriter severally agrees that it will indemnify and hold harmless
the Company and each of the officers of the Company who signed the Registration
Statement and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act to the same extent as the indemnity contained in
subsection (a) of this Section, but only with respect to statements or
omissions made in the Registration Statement (or any amendment thereto) or any
Preliminary Prospectus, such prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through you expressly for use in
the Registration Statement (or any amendment thereto), such Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto). In case any action shall be brought against the Company or any person
so indemnified based on the Registration Statement (or any amendment thereto)
or such Preliminary Prospectus, such prospectus or the Prospectus (or any
amendment or supplement thereto) and in respect of which indemnity may be
sought against any Underwriter, such Underwriter shall have the rights and
duties given to the Company, and the Company and each person so indemnified
shall have the rights and duties given to the Underwriters, by the provisions
of subsection (a) of this Section.
(c) No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) If the indemnification provided for in this Section 7 is unavailable to or
insufficient to hold harmless an indemnified party in respect of any losses,
claims, damages, liabilities or expenses (or actions in respect thereof) that
would otherwise have been indemnified under the terms of such indemnity, then
each indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Company on the one hand and
the Underwriters on the other from the offering of the Notes. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the
Company 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 Company bear to the total compensation
received by the Underwriters in respect of the underwriting discount as set
forth in the table on the cover page of the Prospectus. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company on the
one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it would not
be just and
10
equitable if contributions pursuant to this Section were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages,
liabilities or expenses (or actions in respect thereof) referred to above in
this Section shall be deemed to include 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, no Underwriter shall be required to contribute any amount in excess of
the amount by which the total
price at which the Notes underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section are several in proportion to their respective
underwriting obligations and not joint.
8. Default by One or More of the Underwriters. (a) If any Underwriter shall
default in its obligation to purchase the Notes which it has agreed to purchase
hereunder on the Closing Date, you may in your discretion arrange for you or
another party or other parties to purchase such Notes on the terms contained
herein. If within thirty-six hours after such default by any Underwriter you do
not arrange for the purchase of such Notes, then the Company shall be entitled
to a further period of thirty-six hours within which to procure another party
or other parties satisfactory to you to purchase such Notes on such terms. In
the event that, within the respective prescribed periods, you notify the
Company that you have so arranged for the purchase of such Notes, or the
Company notifies you that it has so arranged for the purchase of such Notes,
you or the Company shall have the right to postpone such Closing Date for a
period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus, or
in any other documents or arrangements, and the Company agrees to file promptly
any amendments to the Registration Statement or the Prospectus which may be
required. The term "Underwriter" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Notes.
(b) If, after giving effect to any arrangements for the purchase of the Notes
of a defaulting Underwriter or Underwriters by you or the Company as provided
in subsection (a) above, the aggregate amount of such Notes which remains
unpurchased does not exceed one-eleventh of the aggregate amount of all the
Notes to be purchased at such Closing Date, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the amount of
Notes which such Underwriter agreed to purchase hereunder at such Closing Date
and, in addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the amount of Notes which such Underwriter agreed to
purchase hereunder) of the Notes of such defaulting Underwriter or Underwriters
for which such arrangements have not been made; but nothing herein shall
relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the Notes
of a defaulting Underwriter or Underwriters by you or the Company as provided
in subsection (a) above, the
11
aggregate amount of such Notes which remains unpurchased exceeds one-eleventh
of the aggregate amount of all the Notes to be purchased at such Closing Date,
or if the Company shall not exercise the right described in subsection
(b) above to require non-defaulting Underwriters to purchase Notes of a
defaulting Underwriter or Underwriters, then this Agreement shall thereupon
terminate, without liability on the part of any non-defaulting Underwriter or
the Company, except for the expenses to be borne by the Company as provided in
Section 5(g) hereof and the indemnity and contribution agreement in Section 7
hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
9. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of
the Company or its officers and of the several Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made
by or on behalf of any Underwriter or the Company, or any of its officers or
directors or any controlling person, and will survive delivery of and payment
for the Notes.
10. Reliance on Your Acts. In all dealings hereunder, shall act on behalf
of each of the Underwriters, and the Company shall be entitled to act and rely
upon any statement, request, notice or agreement on behalf of any Underwriter
made or given by in connection with the transaction to be performed under
this Agreement.
11. Notices. All communications hereunder will be in writing and, if sent to
the Underwriters, will be mailed or telecopied and confirmed to the
Underwriters, in care of Attn: , , , facsimile number
( ) - , or, if sent to the Company, will be mailed or telecopied and
confirmed to it at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ 77251-
1642, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Senior
Vice President and Chief Financial Officer; provided, however, that any notice
to an Underwriter pursuant to Section 7 hereof shall be sent by mail or
telecopy to such Underwriter at its address or telecopy number set forth in its
Underwriters' Questionnaire or telex constituting such Questionnaire, which
address or telecopy number will be supplied to the Company by . Any
such communications shall take effect upon receipt thereof.
12. Business Day. As used herein, the term "business day" shall mean any day
when the Commission's office in Washington, D.C. is open for business.
13. Successors. This Agreement shall inure to the benefit of and be binding
upon the Underwriters and the Company and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons, officers and directors
referred to in Section 7, and their respective successors, heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained; this Agreement and
all conditions and provisions hereof being intended to be and being for the
sole and exclusive benefit of the parties hereto and their respective
successors and said controlling persons, officers and directors and their
respective successors, heirs and legal representatives, and for the benefit of
no other person, firm or corporation. No purchaser of Notes
12
from any Underwriter shall be deemed to be a successor or assign by reason
merely of such purchase.
14. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument.
15. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of New York.
If the foregoing is in accordance with your understanding, kindly sign and
return to us two counterparts hereof, and upon confirmation and acceptance
by on behalf of each of the Underwriters, this letter and such
confirmation and acceptance will become a binding agreement between the
Company, on the one hand, and each of the Underwriters, on the other hand, in
accordance with its terms. It is understood that confirmation and acceptance of
this letter by on behalf of each of the Underwriters is pursuant to
the authority set forth in a form of Agreement Among Underwriters, the form of
which shall be submitted to the Company for examination, but without warranty
on your part as to the authority of the signers thereof.
Very truly yours,
Texas Eastern Transmission, LP
By: Duke Energy Gas Transmission
Services, LLC, as General
Partner
By:________________________
Name:
Title:
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
By:
By:________________________
Name:
Title:
On behalf of each of the Underwriters
13
SCHEDULE A
Principal
Amount of
Notes to be
Underwriter Purchased
----------- -----------
-----------
Total........................................................... $
===========
14
