Exhibit 1.1
Executed Version
KINDER MORGAN ENERGY PARTNERS,
L.P.
Common Units Representing Limited Partner
Interests
Having an Aggregate Offering Price of up to
$600,000,000
AMENDED AND RESTATED
EQUITY DISTRIBUTION AGREEMENT
October 1, 2009
UBS Securities LLC
299 Park Avenue
New York, New York 10171-0026
Ladies and Gentlemen:
This Agreement amends and restates
in its entirety that certain Equity Distribution Agreement, dated
January 16, 2009 (the “ Original Agreement
”), by and between Kinder Morgan Energy Partners, L.P., a
Delaware limited partnership (the “ Partnership
”) and UBS Securities LLC (the “ Manager
”), which contemplated the issuance and sale of Common Units
having an aggregate offering price of up to $300,000,000 to or
through the Manager, of which Common Units having an aggregate
offering price of $237,957,266 were issued and sold pursuant to the
Original Agreement. As of the date hereof, Common Units having an
aggregate offering price of $62,042,734 remain authorized for
issuance and sale pursuant to the terms of the Original
Agreement. This Agreement provides for the issuance of Common
Units having an aggregate offering price of up to $600,000,000,
which amount includes the Common Units having an aggregate offering
price of up to $300,000,000 authorized for issuance and sale under
the Original Agreement and additional Common Units having an
aggregate offering price of up to $300,000,000.
The Partnership confirms its
agreement (this “ Agreement ”) with the Manager
as follows:
SECTION 1.
Description of Securities . The Partnership proposes
to issue and sell through or to the Manager, as sales agent and/or
principal, common units representing limited partner interests in
the Partnership (the “ Common Units ”) having an
aggregate offering price of up to $600,000,000 (the “
Units ”) on the terms set forth in
Section 3 of this Agreement. The Partnership
agrees that whenever it determines to sell the Units directly to
the Manager as principal, it will enter into a separate agreement
(each, a “ Terms Agreement ”) in form and
substance satisfactory to the Partnership and the Manager, relating
to such sale in accordance with Section 3 of this
Agreement.
SECTION 2.
Representations and Warranties of the Partnership .
The Company represents and warrants to and agrees with the Manager
that:
(a) The
Partnership has prepared and filed with the Securities and Exchange
Commission (the “ Commission ”), pursuant to the
Securities Act of 1933, as amended (the “ Act ”)
and the rules and regulations adopted by the Commission
thereunder (the “ Rules ”), a registration
statement on Form S-3 (Registration Statement
No. 333-153598), including a prospectus, relating to the
Units, and such registration statement has become effective.
Such registration statement, as amended to the date of this
Agreement, and including (1) financial statements, exhibits
and Incorporated Documents (as hereinafter defined), (2) any
information contained or incorporated by reference in a prospectus
filed with the Commission pursuant to Rule 424(b) of the
Rules, to the extent such information is deemed, pursuant to
Rule 430B or Rule 430C of the Rules, to be part of the
registration statement at the time of such registration
statement’s effectiveness for purposes of Section 11 of
the Act, as such section applies to the Manager, and (3) any
registration statement filed to register the offer and sale of
Units pursuant to Rule 462(b) of the Rules, is
hereinafter referred to as the “ Registration
Statement ,” and includes any new registration statement,
post-effective amendment to such registration statement or new
shelf registration statement as may have been filed pursuant to
Section 4(f) of this Agreement. The
prospectus dated December 15, 2008 filed as part of the
Registration Statement is hereinafter referred to as the “
Base Prospectus ,” unless a new registration statement
has been filed under Section 4(f) of this
Agreement and become effective, in which case the “Base
Prospectus” shall be the final prospectus first filed with
the Commission pursuant to Rule 424(b) after the
effectiveness of such new registration statement. Except with
respect to Section 7 , the most recent prospectus
supplement relating to the Units filed with the Commission pursuant
to Rule 424(b) of the Rules is hereinafter referred
to as the “ Prospectus Supplement .” The
Base Prospectus, as supplemented by the Prospectus Supplement, is
hereinafter referred to as the “ Prospectus
.” Any reference herein to the Registration Statement,
the Base Prospectus, any Prospectus Supplement or the Prospectus
shall be deemed to include all documents incorporated, or deemed to
be incorporated, therein by reference pursuant to the requirements
of Item 12 of Form S-3 under the Act (the “
Incorporated Documents ”). For purposes of this
Agreement, all references to the Registration Statement, the Base
Prospectus, the Prospectus Supplement, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system (“
EDGAR ”), which EDGAR copy is substantially identical
to the other copies of such material, except to the extent
permitted by Regulation S-T.
(b) The
Partnership has reasonable grounds to believe that it meets the
requirements for the use of Form S-3 under the Act. For
purposes of
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each offering of
the Units pursuant to transactions under this Agreement that are
not firm commitment underwritings, the Partnership will be an
“ineligible issuer” (as defined in Rule 405 under
the Act) as of each relevant eligibility determination date for
purposes of Rules 164 and 433 under the Act.
(c) The
Commission has not issued an order preventing or suspending the use
of the Base Prospectus, the Prospectus Supplement or the
Prospectus, or the effectiveness of the Registration Statement, and
no proceeding for that purpose or pursuant to Section 8A of
the Act has been instituted or, to the Partnership’s
knowledge, threatened by the Commission.
(d) The
Registration Statement, at the time it originally became effective,
as of the date hereof, as of the time of each sale of Units
pursuant to this Agreement (each, a “ Time of Sale
”), at each Settlement Date (as defined in
Section 3(a)(vi) ) and at all times during which a
prospectus is required by the Act to be delivered (whether
physically, deemed to be delivered pursuant to Rule 153 of the
Rules or through compliance with Rule 172 of the
Rules or any similar rule) in connection with any sale of
Units, will comply, in all material respects, with the applicable
requirements of the Act and the Rules; the Incorporated Documents,
when they were or are filed with the Commission, conformed or will
conform as of their respective dates in all material respects with
the applicable requirements of the Securities Exchange Act of 1934,
as amended (the “ Exchange Act ”), and the
applicable rules and regulations adopted by the Commission
thereunder; and the Prospectus will comply, as of the date that
each Prospectus Supplement is filed with the Commission, each Time
of Sale, each Settlement Date, and at all times during which a
prospectus is required by the Act to be delivered (whether
physically, deemed to be delivered pursuant to Rule 153 of the
Rules or through compliance with Rule 172 of the
Rules or any similar rule) in connection with any sale of
Units, in all material respects, with the requirements of the Act
(including, without limitation, Section 10(a) of the
Act).
(e)
(i) Each part of the Registration Statement and any amendment
thereto, at the time it became or becomes effective did not 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 not misleading; (ii) the
Registration Statement meets, and the offering and sale of the
Units as contemplated hereby complies with, the requirements of
Rule 415 of the Rules; (iii) the Base Prospectus and any
amendment thereto, at the time it was filed or will be filed with
the Commission, did not 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 not
misleading; (iv) the Prospectus and any amendment or
supplement thereto, at the time it was filed or will be filed with
the Commission pursuant to Rule 424 of the Rules, did not and
will not contain an untrue statement of a material fact necessary
in
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order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; and (v) as of each Time of
Sale, each related Settlement Date and at the time a prospectus
relating to the Units is required by the Act to be delivered
(whether physically, deemed to be delivered pursuant to
Rule 153 of the Rules or through compliance with
Rule 172 of the Rules or any similar rule), the
Prospectus, as then amended or supplemented, did not and will not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided , however , that the Partnership
makes no representation or warranty with respect to any statement
contained in the Registration Statement or the Prospectus in
reliance upon and in conformity with information furnished in
writing by or on behalf of the Manager expressly for use in the
Registration Statement or the Prospectus.
(f) Prior
to the execution of this Agreement, the Partnership has not,
directly or indirectly, offered or sold any Units by means of any
“prospectus” (within the meaning of the Act) or used
any “prospectus” (within the meaning of the Act) in
connection with the offer or sale of the Units, in each case other
than the Base Prospectus; the Partnership has not, directly or
indirectly, prepared, used or referred to any issuer free writing
prospectus, as defined in Rule 433 of the Rules, with respect
to the Units, although the Partnership makes no representation with
respect to actions taken by the Manager.
(g) The
consolidated financial statements included or incorporated by
reference in the Registration Statement and the Prospectus present
fairly the financial position of the Partnership and its
consolidated subsidiaries as of the dates shown and their results
of operations, partners’ capital and cash flows for the
periods shown, and, except as otherwise disclosed in the
Registration Statement and the Prospectus, such financial
statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent
basis; any schedules included in the Registration Statement present
fairly the information required to be stated therein; any summary
or selected financial data included in the Registration Statement
and the Prospectus present fairly the information shown therein
and, to the extent based upon or derived from the financial
statements, have been compiled on a basis consistent with the
financial statements presented therein except as otherwise stated
therein or in the notes thereto; and as to any pro forma financial
statements included or incorporated by reference in the
Registration Statement and the Prospectus, the assumptions used in
preparing the pro forma financial statements so included or
incorporated by reference in the Registration Statement and the
Prospectus provide a reasonable basis for presenting the
significant effects directly attributable to the transactions or
events described therein, the related pro forma
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adjustments give
appropriate effect to those assumptions, and the pro forma columns
therein reflect the proper application of those adjustments to the
corresponding historical financial statement amounts.
(h) The
Partnership is a limited partnership duly formed, validly existing
and in good standing under the laws of the State of Delaware, with
all necessary partnership power and authority to own its properties
and conduct its business as described in the Prospectus and is in
good standing under the laws of each other jurisdiction in which it
owns or leases properties or conducts any business so as to require
such qualification, except where the failure to be so qualified
would not, individually or in the aggregate, have a material
adverse effect on the consolidated financial condition, results of
operations or business of the Partnership and its subsidiaries,
taken as a whole (a “ Material Adverse Effect
”).
(i) All of
the outstanding shares of capital stock, limited partner interests,
general partner interests, or limited liability company interests,
as applicable, of each of the Partnership’s subsidiaries that
is a “significant subsidiary” as defined in
Rule 1-02 of Regulation S-X, and Trailblazer Pipeline Company
and TransColorado Gas Transmission Company (collectively, the
“ Significant Subsidiaries ”), have been duly
and validly authorized and issued and are fully paid and (except
(A) as required to the contrary by the Delaware Limited
Liability Company Act (the “ Delaware LLC Act ”)
and the Delaware Revised Uniform Limited Partnership Act (the
“ Delaware LP Act ”) and (B) with respect
to any general partner interests) non-assessable, and are owned by
the Partnership directly or indirectly through one or more
wholly-owned subsidiaries or Kinder Morgan G.P., Inc., a
Delaware corporation (the “ General Partner
”). All of such shares or interests owned directly or
indirectly by the Partnership or the General Partner are owned free
and clear of any lien, encumbrance, security interest, equity or
charge (except for such liens, encumbrances, security interests,
equities or charges as are not, individually or in the aggregate,
material to such ownership or as described in the
Prospectus).
(j) Each
of the Significant Subsidiaries has been duly incorporated or
formed and is validly existing as a corporation, limited
partnership, general partnership, or limited liability company, as
the case may be, in good standing under the laws of the
jurisdiction in which it is chartered or organized, with full
entity power and authority to own or lease, as the case may be, and
to operate its properties and conduct its business as described in
the Prospectus, and is duly qualified to do business as a
corporation, limited partnership, general partnership, or limited
liability company, as the case may be, and is in good standing
under the laws of each jurisdiction which requires such
qualification, except where the failure to be so qualified would
not, individually or in the aggregate, have a Material Adverse
Effect.
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(k) The
General Partner is the sole general partner of the Partnership and
Kinder Morgan Operating L.P. “A,” a Delaware limited
partnership (“ OLP-A ”), Kinder Morgan Operating
L.P. “B,” a Delaware limited partnership (“
OLP-B ”), Kinder Morgan Operating L.P.
“C,” a Delaware limited partnership (“
OLP-C ”), Kinder Morgan Operating L.P.
“D,” a Delaware limited partnership (“
OLP-D ”), and Kinder Morgan CO2 Company, L.P., a Texas
limited partnership (“ CO2 ”, and together with
OLP-A, OLP-B, OLP-C, and OLP-D, the “ Operating
Partnerships ”); the General Partner owns general partner
interests in the Partnership and the Operating Partnerships; each
such general partner interest is duly authorized by the Agreement
of Limited Partnership of the Partnership, as amended and restated,
or the agreement of limited partnership, as amended and restated,
of the respective Operating Partnership, as the case may be, and
was validly issued to or acquired by the General Partner; and the
General Partner owns such general partner interests free and clear
of any lien, encumbrance, security interest, equity or charge
(except for such liens, encumbrances, security interests, equities
or charges as are not, individually or in the aggregate, material
to such ownership or as described in the Prospectus).
(l) The
General Partner has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
Delaware; the General Partner is an indirect subsidiary of Kinder
Morgan, Inc., a Kansas corporation; and the General Partner
has all necessary corporate power and authority to own its
properties and conduct its business as described in the Prospectus
and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification, except
where the failure to be so qualified would not, individually or in
the aggregate, have a Material Adverse Effect.
(m)
Kinder Morgan Management, LLC, a Delaware limited liability company
(the “ Company ”), all of the shares of which
that may vote for the election of directors are owned by the
General Partner, is the delegate of the General Partner pursuant to
that certain Delegation of Control Agreement among the General
Partner, the Company, the Partnership and the Operating
Partnerships dated as of May 18, 2001, as amended from time to
time (the “ Delegation of Control Agreement ”);
the Company is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of
Delaware; and the Company has all the necessary limited liability
company power and authority to perform its functions as the
delegate of the General Partner.
(n) The
Partnership has all necessary partnership power and authority to
authorize, issue and sell the Units as contemplated by this
Agreement; and all action required to be taken by the Partnership
for the due
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and proper
authorization, execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby has been duly
and validly taken.
(o) The
Units have been duly and validly authorized and when issued and
delivered against payment therefor pursuant to this Agreement on
each Settlement Date such Units will be validly issued, fully paid
and (except as required to the contrary by the Delaware LP Act)
non-assessable and will conform in all material respects to the
description thereof contained in the Prospectus; and the common
unitholders of the Partnership have no preemptive rights with
respect to the Units.
(p) The
execution, delivery and performance of this Agreement, and the
issuance and sale of the Units hereunder, will not result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the
General Partner, the Company, the Partnership or any of the
Significant Subsidiaries is a party or by which the General
Partner, the Company, the Partnership or any of the Significant
Subsidiaries is bound or to which any of the property of the
General Partner, the Company, the Partnership or any of the
Significant Subsidiaries is subject, except where any such
foregoing occurrence will not prevent the consummation of the
transactions contemplated herein or would not have a Material
Adverse Effect, nor will such action result in any violation of the
provisions of the certificate of incorporation, bylaws, partnership
agreement or other formation document, as the case may be, of the
General Partner, the Company, the Partnership or any of the
Significant Subsidiaries, or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the General Partner, the Company, the Partnership
or any of the Significant Subsidiaries or any of the properties of
any such entities, and no consent, approval, authorization, order,
registration or qualification of or with any court or governmental
agency or body having jurisdiction over the General Partner, the
Company, the Partnership or any of the Significant Subsidiaries or
any of the properties of such entities is required for the issuance
and sale of the Units by the Partnership, except such as have been
obtained or made under the Act, and such consents, approvals,
authorizations, registrations or qualifications as may be required
under the state securities or Blue Sky laws.
(q) Other
than as set forth or incorporated by reference in the Prospectus,
there are no legal or governmental proceedings pending to which the
Partnership or any of its subsidiaries is a party or of which any
property of the Partnership or any of its subsidiaries is the
subject which would be reasonably likely to, individually or in the
aggregate, have a Material Adverse Effect; and, to the
Partnership’s knowledge, no such proceedings are threatened
or contemplated.
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(r) Except
as disclosed (including by means of incorporation by reference) in
the Prospectus, none of the Partnership or any of its subsidiaries
has violated any federal or state law or regulation relating to the
protection of human health or the environment, except for any
violations and remedial actions as would not be reasonably likely
to, individually or in the aggregate, have a Material Adverse
Effect.
(s) Except
as disclosed in or contemplated by the Prospectus, (i) since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, there has been no
change, nor any development or event involving a prospective
change, that would have a Material Adverse Effect, (ii) the
Partnership and its subsidiaries have not sustained since the date
of the latest audited financial statements included or incorporated
by reference in the Prospectus, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or
not covered by insurance, or from any labor dispute or court or
governmental action, order or decree that could reasonably be
expected to have a Material Adverse Effect, and (iii) since
the respective dates as of which information is given in the
Prospectus, there has not been any change, or any development
involving a prospective change, in the partnership interests,
capital stock or long-term debt of the Partnership or any of its
subsidiaries that would constitute a material adverse change to the
Partnership and its subsidiaries taken as a whole, or any material
adverse change in the general affairs, management, financial
position or results of operations of the Partnership and its
subsidiaries taken as a whole, whether or not arising in the
ordinary course of business.
(t) Each
of the Partnership and the Significant Subsidiaries owns or leases
all properties as are necessary to the conduct of its operations as
described in the Prospectus, except where the failure to own or
lease any of such properties would not, individually or in the
aggregate, have a Material Adverse Effect.
(u) The
Partnership is, and after giving effect to the offering and sale of
the Units and the application of the proceeds thereof as described
in the Prospectus, will be, exempt from regulation as an
“investment company,” as defined in the Investment
Company Act of 1940, as amended.
(v) None
of the Partnership, KMGP Services Company, Inc., the General
Partner, the Company or any of the Significant Subsidiaries is
involved in any labor dispute and, to the knowledge of the
Partnership, no such dispute has been threatened, except for such
disputes as would not, individually or in the aggregate, have a
Material Adverse Effect.
(w) To the
Partnership’s knowledge, PricewaterhouseCoopers LLP, who has
certified certain financial statements of the Partnership and
its
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subsidiaries, is
an independent registered public accounting firm as required by the
Act and the Rules.
(x) The
offering and sale of Units, as contemplated by this Agreement, does
not give rise to any rights, other than those which have been
waived or satisfied, for or relating to the registration of any
securities of the Partnership (except as otherwise described in the
Prospectus); and except as described in the Prospectus, or provided
in the various employee or director stock or unit based benefit or
compensation plans, there are no outstanding options or warrants to
purchase any Units, Common Units or other securities of the
Partnership.
(y) None
of the General Partner, Kinder Morgan, Inc., the Company, the
Partnership or any of the Significant Subsidiaries, nor any of
their respective directors and officers has taken any action that
is or was designed to or that has constituted or that might have
reasonably been expected to cause or result in the stabilization or
manipulation of the price of any security of the Partnership to
facilitate the offer or sale of the Units.
(z) The
Partnership maintains a system of internal control over financial
reporting (as such term is defined in
Rule 13a-15(f) under the Exchange Act) that complies with
the requirements of the Exchange Act and has been designed by the
Partnership’s principal executive officer and principal
financial officer, or under their supervision, to provide
reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles; and the Partnership believes that its internal control
over financial reporting is effective.
(aa) Since
the date of the Partnership’s latest financial statements
(audited or unaudited) included or incorporated by reference in the
Prospectus, there h

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