exv1w1
Exhibit 1.1
CVR Partners, LP
19,200,000 Common Units
Representing Limited Partner Interests
Underwriting Agreement
April 7, 2011
Morgan Stanley & Co. Incorporated
Barclays Capital Inc.
Goldman, Sachs & Co.
As representatives of the several Underwriters
named
in Schedule I hereto,
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
CVR Partners, LP, a Delaware limited partnership (the “Company”), proposes, subject to the
terms and conditions stated herein, to issue and sell to the Underwriters named in Schedule I
hereto (the “Underwriters”), for whom Morgan Stanley & Co. Incorporated, Barclays Capital Inc. and
Goldman, Sachs & Co. (collectively, the “Representatives”) are acting as representatives, an
aggregate of 19,200,000 common units (the “Firm LP Units”) representing limited partner interests
in the Company (the “Common Units”), and, at the election of the Underwriters, up to 2,880,000
Common Units (the “Optional LP Units”). The Firm LP Units and the Optional LP Units that the
Underwriters elect to purchase pursuant to Section 2 hereof are collectively called the “LP Units.”
The Company, Coffeyville Resources Nitrogen Fertilizers, LLC, a Delaware limited liability
company and a direct wholly-owned subsidiary of the Company (“Operating LLC”), and Coffeyville
Resources, LLC, a Delaware limited liability company (“Coffeyville Resources”), hereby confirm
their agreement with the several Underwriters as set forth below. Concurrently with the First Time
of Delivery (as defined in Section 4 hereof), CVR GP, LLC, a Delaware limited liability company
(“Managing GP”), will enter into a joinder agreement to this Agreement, the form of which is
attached hereto as Annex II (the “Joinder Agreement”), pursuant to which Managing GP will become a
party to this Agreement and be considered a CVR Party (as defined below) to the same extent as if
it had executed this Agreement on the date hereof. The Company, Operating LLC, Coffeyville
Resources and, upon the execution and delivery of the Joinder
Agreement, Managing GP are collectively referred to herein as the “CVR Parties” and each
individually as a “CVR Party.”
This is to confirm the agreement concerning the purchase of the LP Units from the Company by
the Underwriters.
In connection with the sale of the LP Units hereunder, the Company and its affiliates will
enter into a series of transactions described in the Registration Statement (as defined below)
under the caption “The Transactions and Our Structure and Organization” (collectively, the
“Transactions”). This Agreement, the Joinder Agreement, the Amended and Restated Partnership
Agreement of the Company (the “Partnership Agreement”) and the new $150.0 million credit facility
described in the Registration Statement under the caption “Management’s Discussion and Analysis of
Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit
Facility” (the “New Credit Facility”) are referred to herein, collectively, as the “Transaction
Documents”.
Morgan Stanley & Co. Incorporated (“Morgan Stanley”) has agreed to reserve up to 6.5% of the
Firm LP Units to be purchased by it under this Agreement for sale to the directors, officers and
employees of the Company, Managing GP, CVR Energy, Inc. and its subsidiaries (collectively,
“Participants”), as set forth in the Pricing Prospectus (as defined in Section 1(i)) under the
heading “Underwriters” (the “Directed Unit Program”). The Firm LP Units to be sold by Morgan
Stanley and its affiliates pursuant to the Directed Unit Program are referred to hereinafter as the
“Directed LP Units”. Any Directed LP Units not orally confirmed for purchase by any Participant by
the end of the business day on which this Agreement is executed will be offered to the public by
the Underwriters as set forth in the Pricing Prospectus.
1. The CVR Parties, jointly and severally, represent and warrant to, and agree with, each of
the Underwriters that:
(i) A registration statement on Form S-1 (File No. 333-171270) (the “Initial Registration
Statement”) in respect of the LP Units has been filed with the Securities and Exchange Commission
(the “Commission”); the Initial Registration Statement and any post-effective amendment thereto,
each in the form heretofore delivered to you, and, excluding exhibits thereto, to you for each of
the other Underwriters, have been declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a “Rule 462(b) Registration
Statement”), filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the
“Act”), which became effective upon filing, no other document with respect to the Initial
Registration Statement has heretofore been filed with the Commission; and no stop order suspending
the effectiveness of the Initial Registration Statement, any post-effective amendment thereto or
the Rule 462(b) Registration Statement, if any, has been issued and no proceeding for that purpose
has been initiated or, to the knowledge of the CVR Parties, threatened by the Commission (any
preliminary prospectus included in the Initial Registration Statement or filed with the Commission
pursuant to Rule 424(a) of the rules and
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regulations of the Commission under the Act is hereinafter called a “Preliminary Prospectus”;
the various parts of the Initial Registration Statement and the Rule 462(b) Registration Statement,
if any, including all exhibits thereto and including the information contained in the form of final
prospectus filed with the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective, each as amended at the time such part
of the Initial Registration Statement became effective or such part of the Rule 462(b) Registration
Statement, if any, became or hereafter becomes effective, are hereinafter collectively called the
“Registration Statement”; the Preliminary Prospectus relating to the LP Units that was included in
the Registration Statement immediately prior to the Applicable Time (as defined in Section 1(iii)
hereof) is hereinafter called the “Pricing Prospectus”; the final prospectus, in the form first
filed pursuant to Rule 424(b) under the Act, is hereinafter called the “Prospectus”; and any
“issuer free writing prospectus” as defined in Rule 433 under the Act relating to the LP Units is
hereinafter called an “Issuer Free Writing Prospectus”);
(ii) No order preventing or suspending the use of any Preliminary Prospectus or any Issuer
Free Writing Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the
time of filing thereof, conformed in all material respects to the requirements of the Act and the
rules and regulations of the Commission thereunder, and each Preliminary Prospectus, at the time of
filing thereof, did 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; provided, however, that this
representation and warranty shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company by an Underwriter through
the Representatives expressly for use therein;
(iii) For the purposes of this Agreement, the “Applicable Time” is 6:00 p.m. (New York City
time) on the date of this Agreement. The Pricing Prospectus, when considered together with the
information listed on Schedule IIA hereto, as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading;
and each Issuer Free Writing Prospectus listed on Schedule IIB hereto does not conflict with the
information contained in the Registration Statement, the Pricing Prospectus or the Prospectus and
each such Issuer Free Writing Prospectus, as supplemented by and taken together with the Pricing
Prospectus as of the Applicable Time, did not include any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to statements or omissions made in the Pricing
Prospectus or an Issuer Free Writing Prospectus in
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reliance upon and in conformity with information furnished in writing to the Company by an
Underwriter through the Representatives expressly for use therein;
(iv) The Registration Statement conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement and the Prospectus will conform, in all material respects
to the requirements of the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to each part of the Registration Statement
and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto,
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; provided, however, that
this representation and warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company by an Underwriter
through the Representatives expressly for use therein;
(v) Each statement made in the Registration Statement, the Pricing Prospectus, the Prospectus
and each Issuer Free Writing Prospectus listed on Schedule IIB hereto within the coverage of Rule
175(b) under the Act, including (1) any projections or statements with respect to future available
cash or future cash distributions of the Company, (2) any statements made in support thereof or
related thereto under the heading “Our Cash Distribution Policy and Restrictions on Distributions”
and “How We Make Cash Distributions” and (3) statements made with respect to the anticipated ratio
of taxable income to distributions, was made or will be made with a reasonable basis and in good
faith.
(vi) Neither the Company nor Operating LLC has sustained since the date of the latest audited
financial statements included in the Pricing 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 would, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the current or future
financial position, partners’ capital or members’ equity (as the case may be), or results of
operations of the Company and Operating LLC, taken together as a whole (“Material Adverse Effect”),
in each case otherwise than as set forth or contemplated in the Pricing Prospectus; and, since the
respective dates as of which information is given in the Registration Statement and the Pricing
Prospectus, there has not been any change in the partners’ capital or members’ equity (as the case
may be) or long-term debt of the Company and Operating LLC, taken together as a whole, or any
material adverse change, or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position, partners’ capital or members’ equity
(as the case may be) or results of operations of the Company and Operating LLC, taken together as a
whole, otherwise than as set forth or contemplated in the Pricing Prospectus;
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(vii) The Company and Operating LLC have good and marketable title in fee simple to, or have
valid rights to lease or otherwise use, all material real property and good and marketable title to
all material personal property owned by them, in each case free and clear of all liens,
encumbrances, security interests, equities, charges or claims (“Liens”) except such Liens created
in connection with (1) the Second Amended and Restated Credit and Guaranty Agreement, dated as of
December 28, 2006, among Coffeyville Resources and the other parties thereto, as amended through
the date hereof, (2) the indenture, dated April 6, 2010, among Coffeyville Resources, Coffeyville
Finance Inc., the guarantors party thereto and Wells Fargo Bank, National Association, as trustee,
related to Coffeyville Resources’ 9.0% First Lien Senior Secured Notes due 2015, and (3) the
indenture, dated April 6, 2010, among Coffeyville Resources, Coffeyville Finance Inc., the
guarantors party thereto and Wells Fargo Bank, National Association, as trustee, related to
Coffeyville Resources’ 10.875% Second Lien Senior Secured Notes due 2017 (collectively, the “Debt
Agreements”), which Liens will be released on or prior to the First Time of Delivery, and such
other Liens as are described in the Pricing Prospectus (including Liens for the benefit of lenders
under the New Credit Facility) or such as would not, individually and in the aggregate, reasonably
be expected to have a Material Adverse Effect;
(viii) The Company has been duly formed and is validly existing in good standing as a limited
partnership under the Delaware Revised Uniform Limited Partnership Act (“Delaware LP Act”) with
full partnership power and authority to own or lease its properties, conduct its business as
described in the Registration Statement and the Pricing Prospectus, and enter into and perform its
obligations under this Agreement and each Transaction Document to which it is a party;
(ix) Managing GP has been duly formed and is validly existing in good standing as a limited
liability company under the Delaware Limited Liability Company Act (the “Delaware LLC Act”) with
full limited liability company power and authority to own or lease its properties, conduct its
business as described in the Registration Statement and the Pricing Prospectus, act as a general
partner of the Company, and enter into and perform its obligations under this Agreement, the
Joinder Agreement and each Transaction Document to which it is a party;
(x) Operating LLC has been duly formed and is validly existing in good standing as a limited
liability company under the Delaware LLC Act with full limited liability company power and
authority to own or lease its properties, conduct its business as described in the Registration
Statement and the Pricing Prospectus, and enter into and perform its obligations under this
Agreement and each Transaction Document to which it is a party;
(xi) Coffeyville Resources has been duly formed and is validly existing in good standing as a
limited liability company under the Delaware LLC Act with full limited liability company power and
authority to own or lease its properties, conduct its business as described in the Registration
Statement and the Pricing Prospectus, act as the sole member of Managing GP, and enter into and
perform
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its obligations under this Agreement and each Transaction Document to which it is a party;
(xii) Each of the Company and Operating LLC is duly registered or qualified as a foreign
limited liability company or limited partnership, as the case may be, for the transaction of
business under the laws of each jurisdiction in which the character of the business conducted by it
or the nature or location of the properties owned or leased by it makes such registration or
qualification necessary, except where the failure to be qualified in any jurisdiction would not,
individually and in the aggregate, reasonably be expected to have a Material Adverse Effect;
(xiii) At or before the First Time of Delivery (or immediately thereafter), Managing GP will
own the sole general partner interest in the Company and will be the managing general partner of
the Company. Such managing general partner interest has been duly authorized and validly issued in
accordance with the Partnership Agreement and such managing general partner interest is fully paid
(to the extent required under the Partnership Agreement). Managing GP owns such managing general
partner interest free and clear of all Liens (except Liens pursuant to the Debt Agreements or
contained in Section 4.6 of the Partnership Agreement);
(xiv) At the First Time of Delivery or any Option Time of Delivery (as defined in Section 4
hereof), as the case may be, the Firm LP Units or the Optional LP Units to be sold by the Company
and the limited partner interests represented thereby, will be duly authorized in accordance with
the Partnership Agreement and, when issued and delivered to the Underwriters against payment
therefor in accordance with the terms hereof, will be validly issued, fully paid (to the extent
required under the Partnership Agreement) and nonassessable (except as such nonassessability may be
affected by Sections 17-303, 17-607 and 17-804 of the Delaware LP Act or as otherwise described in
the Pricing Prospectus under the caption “The Partnership Agreement—Limited Liability”) and
conform in all material respects to the description of the Common Units in the Prospectus. Assuming
no purchase by the Underwriters of any Optional LP Units, at the First Time of Delivery, after
giving effect to the Transactions, Coffeyville Resources will own 53,800,000 Common Units, Managing
GP will own the managing general partner interest of the Company and, other than such Common Units
and managing general partner interest, the Firm LP Units will be the only limited partner interests
in the Company issued and outstanding (other than any Common Units granted to officers and
directors of the Company as described in the Pricing Prospectus);
(xv) The Company owns 100% of the issued and outstanding member interests in Operating LLC;
such member interests have been duly authorized and validly issued in accordance with the limited
liability company agreement of Operating LLC (as the same may be amended or restated at or prior to
the applicable Time of Delivery (as defined in Section 4 hereof), the “Operating LLC
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Agreement”) and are fully paid (to the extent required under the Operating LLC Agreement) and
nonassessable (except as such nonassessability may be affected by Sections 18-607 and 18-804 of the
Delaware LLC Act); and the Company owns such member interest free and clear of all Liens other than
Liens arising under or in connection with (1) the Debt Agreements, which Liens will be released on
or prior to the First Time of Delivery, and (2) the New Credit Facility;
(xvi) As of the date hereof, Coffeyville Acquisition III LLC (“Coffeyville Acquisition”) owns
100% of the issued and outstanding member interests in Managing GP and is the sole member of
Managing GP; such member interests have been duly authorized and validly issued in accordance with
the limited liability company agreement of Managing GP (as the same may be amended or restated at
or prior to the applicable Time of Delivery, the “Managing GP LLC Agreement”) and are fully paid
(to the extent required under the Managing GP LLC Agreement) and nonassessable (except as such
nonassessability may be affected by Sections 18-607 and 18-804 of the Delaware LLC Act); and at or
before the First Time of Delivery (or immediately thereafter), Coffeyville Resources will own such
member interests free and clear of all Liens other than those arising under or in connection with
the Debt Agreements;
(xvii) Other than its ownership of the managing general partner interest in the Company,
Managing GP does not own, directly or indirectly, any equity or long-term debt securities of any
corporation, partnership, limited liability company, joint venture, association or other entity.
Other than the Company’s ownership of a 100% member interest in Operating LLC, neither the Company
nor Operating LLC owns, directly or indirectly, any equity or long-term debt securities of any
corporation, partnership, limited liability company, joint venture, association or other entity;
(xviii) Each of the CVR Parties has all requisite power and authority to execute and deliver
this Agreement and perform its respective obligations hereunder. The Company has all requisite
partnership power and authority to issue, sell and deliver the LP Units to be sold by it, in
accordance with and upon the terms and conditions set forth in this Agreement, the Partnership
Agreement, the Registration Statement, the Pricing Prospectus and the Prospectus. At the First
Time of Delivery (or, in the case of Managing GP, immediately thereafter) and any Option Time of
Delivery, all partnership and limited liability company action, as the case may be, required to be
taken by the CVR Parties or any of their members or partners for the authorization, issuance, sale
and delivery of the LP Units and the consummation of the transactions contemplated by this
Agreement (including the Transactions) shall have been validly taken. This Agreement has been duly
and validly authorized, executed and delivered by each of the CVR Parties; and, concurrently with
the First Time of Delivery, the Joinder Agreement will have been duly authorized, executed and
delivered by Managing GP;
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(xix) The Partnership Agreement has been duly authorized, and, at or before the First Time of
Delivery, will have been duly executed and delivered by each of Managing GP and Coffeyville
Resources, and will be a valid and legally binding agreement of each such party, enforceable
against each such party in accordance with its terms; the Operating LLC Agreement has been duly
authorized, executed and delivered by the Company and is a valid and legally binding agreement of
the Company, enforceable against the Company in accordance with its terms; the Managing GP LLC
Agreement has been duly authorized, executed and delivered by Coffeyville Acquisition and is a
valid and legally binding agreement of Coffeyville Acquisition, enforceable against Coffeyville
Acquisition in accordance with its terms (the Partnership Agreement, the Operating LLC Agreement
and the Managing GP LLC Agreement are referred to herein collectively as the “Operative
Agreements”); provided, that, with respect to each Operative Agreement, the enforceability thereof
may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws relating to or affecting creditors’ rights generally and by general principles of
equity (regardless of whether such enforceability is considered in a proceeding in equity or at
law); and provided further, that the indemnity, contribution and exoneration provisions contained
in any of such Operative Agreements may be limited by applicable laws and public policy;
(xx) Except as described in the Prospectus or, in the case of transfer restrictions, as set
forth in the relevant Operative Agreements, there are no preemptive rights or other rights to
subscribe for or to purchase, nor any restriction upon the voting or transfer of, any partnership
or member interests in any of the CVR Parties. Except as described in the Prospectus, there are no
outstanding options or warrants to purchase any partnership or member interests in any of the CVR
Parties;
(xxi) The issue and sale of the LP Units as herein contemplated and the compliance by the CVR
Parties with this Agreement or the Joinder Agreement, as the case may be, and the consummation of
the transactions herein contemplated, including the Transactions, 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 any of
the CVR Parties is a party or by which any of the CVR Parties is bound or to which any of the
property or assets of any of the CVR Parties is subject; nor will such action result in any
violation of the provisions of the Operative Agreements of any of the CVR Parties or any statute or
any order, rule or regulation of any court or governmental agency or body having jurisdiction over
any of the CVR Parties or any of their properties, after giving effect to any consents, approvals,
authorizations, orders, registrations, qualifications, waivers and amendments as have been obtained
or made as of the date of this Agreement; nor does or will such action result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of any of the CVR Parties
(other than any pledge by Coffeyville Resources of its member
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interests in Managing GP in accordance with the Debt Agreements); and no consent, approval, authorization,
order, registration or qualification of or with any such court or governmental agency or body is
required for the issue and sale of the LP Units or the consummation by any of the CVR Parties of
the transactions contemplated by this Agreement or the Joinder Agreement, including the
Transactions, except (i) the registration under the Act and the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), of the LP Units, (ii) as described in the Pricing Prospectus, (iii)
such consents, approvals, authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws or the rules and regulations of the Financial Industry Regulatory
Authority (“FINRA”) in connection with the purchase and distribution of the LP Units by the
Underwriters; (iv) filing of any certificate of merger in connection with the merger of CVR Special
GP, LLC, a Delaware limited liability company, with and into Coffeyville Resources; and (v) where
the failure to obtain or make any such consent, approval, authorization, order, registration, or
qualification as would not reasonably be expected, individually and in the aggregate, to have a
Material Adverse Effect or would not materially impair the consummation of the transactions herein
contemplated;
(xxii) There are no contracts, agreements or understandings between any of the CVR Parties and
any person granting such person the right to require the Company to file a registration statement
under the Act with respect to any securities of the Company owned or to be owned by such person or
to require the Company to include such securities in the securities registered pursuant to the
Registration Statement or to have such securities otherwise registered by the Company under the
Act, except as described in the Registration Statement and the Pricing Prospectus;
(xxiii) Neither the Company nor Operating LLC is (a) in violation of its agreement of limited
partnership or limited liability company agreement, as the case may be, or (b) in default in the
performance or observance of any obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which
it is a party or by which it or any of its properties may be bound, except with respect to clause
(b) where such default would not, individually and in the aggregate, reasonably be expected to have
a Material Adverse Effect;
(xxiv) The statements set forth in the Pricing Prospectus and Prospectus under the caption
“Description of Our Common Units,” insofar as they purport to constitute a summary of the terms of
the Common Units, as well as under the captions “Certain Relationships and Related Party
Transactions,” “Conflicts of Interest and Fiduciary Duties,” “The Partnership Agreement” and
“Material U.S. Federal Tax Consequences,” insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate and fair in all material respects;
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(xxv) Other than as set forth in the Pricing Prospectus, there are no legal or governmental
proceedings pending to which the Company or Operating LLC is a party or of which any property of
the Company or Operating LLC is the subject which, if determined adversely to the Company or
Operating LLC, would individually or in the aggregate reasonably be expected to have a Material
Adverse Effect or a material adverse effect on the performance of this Agreement or any of the
Transaction Documents or the consummation of any of the transactions (including the Transactions)
contemplated hereby or thereby; and, to the knowledge of the CVR Parties, no such proceedings are
threatened by governmental authorities or by others;
(xxvi) No relationship, direct or indirect, exists between or among the Company on the one
hand, and the directors, managers, officers, members, partners, stockholders, customers or
suppliers of the Company or any CVR Party, on the other hand, that is required to be described in
the Registration Statement, the Pricing Prospectus or the Prospectus that is not so described.
There are no outstanding loans, advances (except normal advances for business expenses in the
ordinary course of business) or guarantees of indebtedness by the Company to or for the benefit of
any of the officers, directors or managers of the Company, Managing GP or Operating LLC or their
respective family members;
(xxvii) Neither the Company nor Operating LLC is and, after giving effect to the offering and
sale of the LP Units and the application of the proceeds thereof, neither of them will be an
“investment company”, as such term is defined in the Investment Company Act of 1940, as amended
(the “Investment Company Act”);
(xxviii) At the time of filing the Initial Registration Statement the Company was not and is
not an “ineligible issuer,” as defined under Rule 405 under the Act;
(xxix) KPMG LLP, who have certified certain financial statements of the Company, are
independent public accountants with respect to the Company as required by the Act and the rules and
regulations of the Commission thereunder and the rules and regulations of the Public Company
Accounting Oversight Board;
(xxx) The Company maintains a system of internal accounting controls sufficient to provide
reasonable assurance that (A) transactions are executed in accordance with management’s general or
specific authorization; (B) transactions are recorded as necessary to permit preparation of
financial statements in conformity with U.S. Generally Accepted Accounting Principles and to
maintain accountability for assets; (C) access to assets is permitted only in accordance with
management’s general or specific authorization; and (D) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences. None of the CVR Parties is aware of (A) any significant deficiencies
in the design or operation of the Company’s internal controls that could adversely affect the
ability of the Company to record, process, summarize and report financial data in any material
respect, or any material weaknesses in internal controls, or (B) any fraud,
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whether or not material, that involves management or other employees who have a significant
role in the internal controls of any of the Company;
(xxxi) Since the date of the latest audited financial statements included in the Pricing
Prospectus, there has been no change in the internal control over financial reporting of the
Company that has materially adversely affected, or is reasonably likely to materially adversely
affect, the internal control over financial reporting of the Company. The Company maintains
“disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange
Act) that comply with the requirements of the Exchange Act; such disclosure controls and procedures
have been designed to ensure that material information relating to the Company is made known to the
principal executive officer and principal financial officer of Managing GP by others within those
entities; and such disclosure controls and procedures are effective;
(xxxii) Except as disclosed in the Pricing Prospectus, the Company and Operating LLC (A) are
in compliance with any and all applicable foreign, Federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (“Environmental Laws”), (B) have received all
permits, licenses or other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (C) are in compliance with all terms and conditions of any
such permit, license or approval, except with respect to clauses (A), (B) and (C) above 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 and in the aggregate, reasonably be expected to have a Material Adverse
Effect. Except as disclosed in the Pricing Prospectus, there are no costs or liabilities
associated with Environmental Laws (including 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) which would individually or in the aggregate reasonably be expected to have a Material
Adverse Effect;
(xxxiii) The Company and Operating LLC own, have applied for or possess, or can acquire on
reasonable terms, all 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, service marks and trade names currently employed
by them in connection with the business now operated by them as described in the Pricing
Prospectus, except where the failure to own or have such legal right to use would not reasonably be
expected to have a Material Adverse Effect; and except as disclosed in the Pricing Prospectus, none
of the CVR Parties has received any notice of infringement of or conflict with asserted rights of
others with respect to any of the foregoing which would individually or in the aggregate, if the
subject of
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an unfavorable decision, ruling or finding, reasonably be expected to have a Material Adverse
Effect;
(xxxiv) No labor dispute with the employees of the Company or Operating LLC exists, or, to the
knowledge of any of the CVR Parties, is imminent, except for disputes that would not, individually
and in the aggregate, reasonably be expected to have a Material Adverse Effect;
(xxxv) The Company and Operating LLC are insured by insurers against such losses and risks and
in such amounts as are customary in the businesses in which they are engaged; and none of the CVR
Parties has any reason to believe that it will not be able to renew its existing insurance coverage
as and when such coverage expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not, individually and in the aggregate,
reasonably be expected to have a Material Adverse Effect, except as described in the Pricing
Prospectus;
(xxxvi) The Company and Operating LLC possess all material certificates, authorizations and
permits issued by the appropriate Federal, state or foreign regulatory authorities necessary to
conduct their respective businesses as described in the Pricing Prospectus, and none of the CVR
Parties has received any notice of proceedings relating to the revocation or modification of any
such certificate, authorization or permit which, if the subject of an unfavorable decision, ruling
or finding, would individually or in the aggregate reasonably be expected to have a Material
Adverse Effect;
(xxxvii) Except as would not reasonably be expected to have a Material Adverse Effect, the
Company and Operating LLC have filed all Federal, state, local and foreign tax returns which are
required to be filed through the date hereof, which returns are true and correct in all material
respects or has received timely extensions thereof, and have paid all taxes shown on such returns
and all assessments received by it to the extent that the same are material and have become due.
To the knowledge of the CVR Parties, there are no tax audits or investigations pending against the
Company or Operating LLC which would individually or in the aggregate, if adversely determined,
have a Material Adverse Effect; nor are there any proposed additional tax assessments against the
Company or Operating LLC which would individually or in the aggregate reasonably be expected to
have a Material Adverse Effect;
(xxxviii) Neither the Company nor Operating LLC nor any director, officer, or employee of
either of them or Managing GP, nor, to the knowledge of any of the CVR Parties, any agent,
affiliate or representative of the Company, Operating LLC or Managing GP, has taken or will take
any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the
payment or giving of money, property, gifts or anything else of value, directly or indirectly, to
any “government official” (including any officer or employee of a government or government-owned or
controlled entity or of a public international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or
12
any political party or party official or candidate for political office) to influence official
action or secure an improper advantage; and the Company and Operating LLC have conducted their
businesses in compliance with applicable anti-corruption laws and have instituted and maintain and
will continue to maintain policies and procedures designed to promote and achieve compliance with
such laws and with the representation and warranty contained herein;
(xxxix) The operations of the Company, Managing GP and Operating LLC are and have been
conducted at all times in material compliance with all applicable financial recordkeeping and
reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the
Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of
jurisdictions where the Company, Managing GP and Operating LLC conduct business, the rules and
regulations thereunder and any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering
Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving of them with respect to the Anti-Money Laundering Laws is
pending or, to the best knowledge of any CVR Party, threatened;
(xl) (a) Neither the Company nor Operating LLC, nor any director, officer or employee of
either of them or Managing GP, nor, to the knowledge of any CVR Party, any agent, affiliate or
representative of the Company, Operating LLC or Managing GP, is an individual or entity (“Person”)
that is, or is owned or controlled by a Person that is:
(i) the subject of any sanctions administered or enforced by the U.S. Department of
Treasury’s Office of Foreign Assets Control (“OFAC”) (collectively, “Sanctions”),
nor
(ii) located, organized or resident in a country or territory that is the subject
of Sanctions (including, without limitation, Burma/Myanmar, Cuba, Iran, North
Korea, Sudan and Syria).
(b) Each of the CVR Parties represents and covenants that it will not, directly or
indirectly, use the proceeds of the offering, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or other Person:
(i) to fund or facilitate any activities or business of or with any Person or in
any country or territory that, at the time of such funding or facilitation, is the
subject of Sanctions; or
(ii) in any other manner that will result in a violation of Sanctions by any Person
(including any Person participating in the offering, whether as underwriter,
advisor, investor or otherwise).
13
(c) Each of the CVR Parties represents that it has not knowingly engaged in, and is
not now knowingly engaged in, any dealings or transactions with any Person, or in any
country or territory, that at the time of the dealing or transaction is or was the subject
of Sanctions;
(xli) A registration statement with respect to the LP Units has been filed on Form 8-A
pursuant to Section 12 of the Exchange Act, which registration statement complies in all material
respects with the applicable requirements of the Exchange Act;
(xlii) The Registration Statement, the Prospectus and any Preliminary Prospectus comply, and
any amendments or supplements thereto will comply, in all material respects, with any applicable
laws or regulations of foreign jurisdictions in which the Prospectus or any Preliminary Prospectus,
as amended or supplemented, if applicable, are distributed in connection with the Directed Unit
Program;
(xliii) No consent, approval, authorization or order of, or qualification with, any
governmental body or agency, other than those obtained, is required in connection with the offering
of the Directed Units in any jurisdiction where the Directed Units are being offered;
(xliv) The Company has not offered, nor have any of the CVR Parties caused Morgan Stanley to
offer, Directed LP Units to any person with the specific intent to unlawfully influence (A) a
customer or supplier of any of the CVR Parties to alter the customer’s or supplier’s level or type
of business with any of the CVR Parties, or (B) a trade journalist or publication to write or
publish favorable information about any of the CVR Parties or their respective products;
(xlv) The Company has not sold or issued any securities that would be integrated with the
offering of the LP Units contemplated by this Agreement pursuant to the Act, the rules and
regulations or interpretations thereof by the Commission;
(xlvi) The financial statements included in the Prospectus and the Pricing Prospectus present
fairly in all material respects the financial position of the Company and its consolidated
subsidiaries as of the dates shown and its results of operations and cash flows for the periods
shown, and such financial statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent basis. The pro forma financial
statements (including the notes thereto) included in the Prospectus and in the Pricing Prospectus
(A) comply as to form in all material respects with the applicable requirements of Regulation S-X
promulgated under the Act, (B) have been prepared in all material respects in accordance with the
Commission’s rules and guidelines with respect to pro forma financial statements, and (C) have been
properly computed on the bases described therein; the assumptions used in preparing the pro forma
financial statements and other pro forma financial information included in the Prospectus and the
Pricing Prospectus provide a reasonable basis for presenting the significant effects directly
attributable to the
14
transactions or events described therein, the related pro forma 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;
(xlvii) Each of the Transaction Documents has been duly authorized and, at or before the First
Time of Delivery (or, in the case of Managing GP, immediately thereafter), will have been duly
executed and delivered by the parties thereto and will constitute a valid and binding agreement of
the parties thereto, enforceable against the parties to such agreements in accordance with their
respective terms, except as the enforcement thereof may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other similar laws relating to or affecting
creditors’ rights generally, or by general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law);
(xlviii) Each of the Company and Operating LLC has such consents, easements, rights-of-way,
permits or licenses from each person (collectively, “rights-of-way”) as are necessary to conduct
its business in the manner described, and subject to the limitations contained, in the Pricing
Prospectus; other than as set forth, and subject to the limitations contained, in the Pricing
Prospectus, each of the Company and Operating LLC has fulfilled and performed all its material
obligations with respect to such rights-of-way and no event has occurred that allows, or after
notice or lapse of time would allow, revocation or termination thereof or would result in any
impairment of the rights of the holder of any such rights-of-way; and, except as described in the
Pricing Prospectus, none of such rights-of-way contains any restriction that is materially
burdensome to the Company and Operating LLC, taken as a whole; and
(xlix) Operating LLC is not currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on its limited liability company
interests, from repaying to the Company any loans or advances from the Company, or from
transferring any of its property or assets to the Company or any other subsidiary of the Company,
except as described in or contemplated by the Pricing Prospectus.
2. Subject to the terms and conditions herein set forth, (a) the Company agrees to issue and
sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at a purchase price per Common Unit of $14.88 (which is equal to the
initial public offering price of $16.00 per Common Unit less underwriting discounts and commissions
of $1.12 per Common Unit comprising an underwriting discount of $1.04 per Common Unit and a
structuring fee of $0.08 per Common Unit payable to Morgan Stanley & Co. Incorporated and Barclays
Capital Inc.), the number of Firm LP Units set forth opposite the name of such Underwriter in
Schedule I hereto and (b) in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional LP Units as provided below, the Company agrees to issue
15
and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per Common Unit set forth in clause
(a) of this Section 2, that portion of the number of Optional LP Units as to which such election
shall have been exercised (to be adjusted by you so as to eliminate fractional units) determined by
multiplying such number of Optional LP Units by a fraction, the numerator of which is the maximum
number of Optional LP Units which such Underwriter is entitled to purchase as set forth opposite
the name of such Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional LP Units that all of the Underwriters are entitled to purchase hereunder.
The Company hereby grants to the Underwriters, severally and not jointly, the right to
purchase at their election up to 2,880,000 Optional LP Units, at the purchase price per Common Unit
set forth in the paragraph above, for the sole purpose of covering sales of LP Units in excess of
the number of Firm LP Units. The Representatives may elect to exercise this right on behalf of the
Underwriters in whole or from time to time in part. Any such election to purchase Optional LP
Units may be exercised only by written notice from you to the Company, given within a period of 30
calendar days after the date of this Agreement, setting forth the aggregate number of Optional LP
Units to be purchased and the date on which such Optional LP Units are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery or, unless you and the
Company otherwise agree in writing, earlier than two or later than ten business days after the date
of such notice.
3. Upon the authorization by you of the release of the Firm LP Units, the several Underwriters
propose to offer the Firm LP Units for sale upon the terms and conditions set forth in the
Prospectus.
4. (a) The LP Units to be purchased by each Underwriter hereunder, in definitive form, and in
such authorized denominations and registered in such names as the Representatives may request upon
at least forty-eight hours’ prior notice to the Company shall be delivered by or on behalf of the
Company to the Representatives, through the facilities of The Depository Trust Company (“DTC”), for
the account of such Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of Federal (same-day) funds to the account specified by
the Company to the Representatives at least forty-eight hours in advance. The time and date of
such delivery and payment shall be, with respect to the Firm LP Units, 9:30 a.m., New York City
time, on April 13, 2011 or such other time and date as the Representatives and the Company may
agree upon in writing, and, with respect to the Optional LP Units, 9:30 a.m., New York time, on the
date specified by the Representatives in the written notice given by the Representatives of the
Underwriters’ election to purchase such Optional LP Units, or such other time and date as the
Representatives and the Company may agree upon in writing. Such time and date for delivery of the
Firm LP Units is herein called the “First Time of Delivery”, such time and date for delivery of any
Optional LP Units, if not the First Time of Delivery, is herein called
16
an “Option Time of Delivery”, and each such time and date for delivery is herein called a
“Time of Delivery”.
(b) The documents to be delivered at each Time of Delivery by or on behalf of the parties
hereto pursuant to Section 9 hereof, including the cross receipt for the LP Units and any
additional documents requested by the Underwriters pursuant to Section 9(i) hereof, will be
delivered at the offices of Fried, Frank, Harris, Shriver & Jacobson LLP, One New York Plaza, New
York, NY 10004 (the “Closing Location”), and the LP Units will be delivered electronically via the
facilities of DTC, all at such Time of Delivery. A meeting will be held at the Closing Location at
2:00 p.m., New York City time, on the New York Business Day next preceding such Time of Delivery,
at which meeting the final drafts of the documents to be delivered pursuant to the preceding
sentence will be available for review by the parties hereto. For the purposes of this Section 4,
“New York Business Day” shall mean each Monday, Tuesday, Wednesday, Thursday and Friday that is not
a day on which banking institutions in New York City are generally authorized or obligated by law
or executive order to close.
5. The Company agrees with each of the several Underwriters:
(a) To prepare the Prospectus in a form to which you shall not have reasonably objected on a
timely basis and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission’s close of business on the second business day following the execution and delivery of
this Agreement; to make no further amendment or any supplement to the Registration Statement or the
Prospectus prior to the last Time of Delivery which shall be reasonably disapproved by you promptly
after reasonable notice thereof; to advise you, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed or becomes effective or any
amendment or supplement to the Prospectus has been filed and to furnish you with copies thereof; to
file promptly all material required to be filed by the Company with the Commission pursuant to Rule
433(d) under the Act; to advise you, promptly after it receives notice thereof, of the issuance by
the Commission of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or other prospectus in respect of the LP Units, of the suspension of the
qualification of the LP Units for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or other prospectus or suspending any such
qualification, to promptly use its reasonable best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you may reasonably request to qualify
the LP Units for offering and sale under the securities laws of such jurisdictions as you may
request and to comply with such laws so as to permit the continuance of sales and dealings therein
in such
17
jurisdictions for as long as may be necessary to complete the distribution of the LP Units,
provided that in connection therewith the Company shall not be required to qualify as a foreign
partnership or to file a general consent to service of process or subject itself to taxation for
doing business in any jurisdiction;
(c) To furnish the Underwriters prior to 5:00 p.m., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time to time, with written and
electronic copies of the Prospectus in New York City in such quantities as you may reasonably
request, and, if (i) the Underwriters notify the Company that or (ii) the Company otherwise has
knowledge that the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is required at any time prior to the expiration of nine months after the time
of issue of the Prospectus in connection with the offering or sale of the LP Units and if at such
time any event shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus in order to comply with the
Act, to notify you and upon your request to prepare and furnish without charge to each Underwriter
and to any dealer in securities as many written and electronic copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct
such statement or omission or effect such compliance, and in case any Underwriter is required to
deliver a prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Act) in
connection with sales of any of the LP Units at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the expense of such Underwriter, to prepare and
deliver to such Underwriter as many written and electronic copies as you may request of an amended
or supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as practicable, but in any
event not later than sixteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule 158);
(e) During the period commencing on the date hereof and ending 180 days after the date hereof
(the “Lock-Up Period”), not to offer, sell, contract to sell, pledge, grant any option to purchase,
make any short sale or otherwise dispose, except as provided hereunder, of any securities of the
Company that are substantially similar to the LP Units, including but not limited to any options or
warrants to purchase Common Units or any securities that are convertible into or exchangeable for,
or that represent the right to receive, Common Units or any
18
such substantially similar securities (other than pursuant to employee and/or director equity
plans existing on, or upon the conversion or exchange of convertible or exchangeable securities
outstanding as of the date of this Agreement or as described in the Prospectus), without your prior
written consent; provided, however, that if (1) during the last 17 days of the initial Lock-Up
Period, the Company releases earnings results or announces material news or a material event or (2)
prior to the expiration of the initial Lock-Up Period, the Company announces that it will release
earnings results during the 15-day period following the last day of the initial Lock-Up Period,
then in each case the Lock-Up Period will be automatically extended until the expiration of the
18-day period beginning on the date of release of the earnings results or the announcement of the
material news or material event, as applicable, unless the Representatives waive, in writing, such
extension; the Company will provide the Representatives and each unitholder subject to the Lock-Up
Period pursuant to the lockup letters described in Section 8(k) with prior notice of any such
announcement that gives rise to an extension of the Lock-up Period;
(f) Until the earlier of three years from the date hereof or the attainment by the Company of
“Well-Known Seasoned Issuer” status as defined under the Act, to furnish to its unitholders as soon
as practicable after the end of each fiscal year an annual report (including a balance sheet and
statements of income, partners’ capital and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, as soon as practicable after the end
of each of the first three quarters of each fiscal year (beginning with the fiscal quarter ending
after the effective date of the Registration Statement), to make available to its unitholders
consolidated summary financial information of the Company and its subsidiaries for such quarter in
reasonable detail; provided, however, that the Company will be deemed to have satisfied the
requirements of this paragraph (f) if the Company files with or furnishes to the Commission the
reports, documents or information required by Section 13 or 15(d) of the Exchange Act;
(g) To use the net proceeds received by it from the sale of the LP Units pursuant to this
Agreement in the manner specified in the Pricing Prospectus under the caption “Use of Proceeds”;
(h) To file with the Commission such information on Form 10-Q or Form 10-K as may be required
by Rule 463 under the Act; and
(i) If the Company elects to rely upon Rule 462(b), the Company shall use its commercially
reasonable efforts to file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and the
Company shall at the time of filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment of such fee pursuant to
Rule 111 under the Act.
19
6. (a) The Company represents and agrees that, without the prior consent of the
Representatives, it has not made and will not make any offer relating to the LP Units that would
constitute a “free writing prospectus” as defined in Rule 405 under the Act; each Underwriter
represents and agrees that, without the prior consent of the Company and the Representatives, it
has not made and will not make any offer relating to the LP Units that would constitute a free
writing prospectus; the Company and the Representatives agree that any such free writing prospectus
the use of which has been consented to by the Company and the Representatives is listed on Schedule
IIB hereto;
(b) The Company has complied and will comply with the requirements of Rule 433 under the
Act applicable to any Issuer Free Writing Prospectus, including timely filing with the Commission
or retention where required and legending; and the Company represents that it has satisfied and
agrees that it will satisfy the conditions under Rule 433 under the Act to avoid a requirement to
file with the Commission any electronic road show; and
(c) The Company agrees that if at any time following issuance of an Issuer Free Writing
Prospectus any event occurred or occurs as a result of which such Issuer Free Writing Prospectus
would conflict with the information in the Registration Statement, the Pricing Prospectus or the
Prospectus or would include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances then
prevailing at the time of such issuance, not misleading, the Company will give prompt notice
thereof to the Representatives and, following such notice, if requested by the Representatives,
will prepare and furnish without charge to each Underwriter an Issuer Free Writing Prospectus or
other document that will correct such conflict, statement or omission; provided, however, that this
covenant shall not apply to any statements or omissions in an Issuer Free Writing Prospectus made
in reliance upon and in conformity with information furnished in writing to the Company by an
Underwriter through the Representatives expressly for use therein.
7. (a) The Company covenants and agrees with the several Underwriters to pay or cause to
be paid the following: (i) the fees, disbursements and expenses of the Company’s counsel and
accountants in connection with the registration of the LP Units under the Act and all other
expenses in connection with the preparation, printing, reproduction and filing of the Registration
Statement, any Preliminary Prospectus, any Issuer Free Writing Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) all expenses in connection with the qualification of the LP Units
for offering and sale under state securities laws as provided in Section 5(b) hereof, including the
reasonable fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the blue sky memorandum; (iii) all fees and expenses in
connection with listing the LP Units on the Exchange; (iv) the filing
fees incident to, and the reasonable fees and disbursements of counsel for the
20
Underwriters in
connection with, any required review by FINRA of the terms of the sale of the LP Units (the total
amount of fees and disbursements of counsel for the Underwriters under clauses (ii) and (iv) shall
be capped at no more than $35,000); (v) the cost of preparing unit certificates; (vi) the cost and
charges of any transfer agent or registrar; and (vii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically provided for in this
Section 7; provided, however, that the costs associated with the chartering of an aircraft used by
the Company and the Underwriters to attend meetings with prospective purchasers of the LP Units
will be divided equally between the Company on the one hand and the Underwriters on the other hand,
and each of the Company and the Underwriters will pay for their own costs in connection with
meetings with prospective purchasers. It is understood, however, that the Company shall bear the
cost of any other matters not directly relating to the sale and purchase of the LP Units pursuant
to this Agreement. It is understood, however, that, except as provided in this Section 7, and
Sections 9 and 14 hereof, the Underwriters will pay all of their own costs and expenses, including
the fees of their counsel, stock transfer taxes on resale of any of the LP Units by them, and any
advertising expenses connected with any offers they may make.
(b) The Company covenants and agrees with the several Underwriters to pay or cause to be
paid the following: (i) all fees and disbursements of counsel incurred by the Underwriters in
connection with the Directed Unit Program; (ii) all costs and expenses incurred by the Underwriters
in connection with the printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of copies of the Directed Unit Program material;
and (iii) all stamp duties, similar taxes or duties or other taxes, if any, incurred by the
Underwriters in connection with the Directed Unit Program.
Furthermore, the Company agrees with the several Underwriters that it will comply in all
material respects with all applicable securities and other laws, rules and regulations in each
foreign jurisdiction in which the Directed Units are offered in connection with the Directed Unit
Program, provided that the Representatives give the Company advance notice a reasonable period of
time before making offers of which foreign jurisdictions are involved.
8. The obligations of the Underwriters hereunder, as to the LP Units to be delivered at
each Time of Delivery, shall be subject, in their discretion, to the condition that all
representations and warranties and other statements of the CVR Parties herein are, at and as of
such Time of Delivery, true and correct, the condition that the CVR Parties shall have performed
all of their respective obligations hereunder theretofore to be performed, and the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to Rule
424(b) under the Act within the applicable time period
21
prescribed for such filing by the
rules and regulations under the Act and in accordance with Section 5(a) hereof; all
material required to be filed by the Company pursuant to Rule 433(d) under the Act shall
have been filed with the Commission within the applicable time period prescribed for such
filing by Rule 433; if the Company has elected to rely upon Rule 462(b) under the Act, the
Company shall have used commercially reasonable efforts to cause the Rule 462(b)
Registration Statement to have become effective by 10:00 P.M., Washington, D.C. time, on
the date of this Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; no stop order suspending or
preventing the use of the Prospectus or any Issuer Free Writing Prospectus shall have been
initiated or threatened by the Commission; and all requests for additional information on
the part of the Commission shall have been complied with to your reasonable satisfaction;
(b) Debevoise & Plimpton LLP, counsel for the Underwriters, shall have furnished
to you such written opinion or opinions, dated such Time of Delivery, in form and substance
satisfactory to you, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(c) Andrews Kurth LLP, counsel for the Underwriters, shall have furnished to you
such written opinion or opinions, dated such Time of Delivery, in form and substance
satisfactory to you, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(d) Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the Company, shall
have furnished to you their written opinion (a draft of the form of such opinion is
attached as Annex I(a) hereto), dated such Time of Delivery, in form and substance
satisfactory to you;
(e) Vinson & Elkins L.L.P., counsel for the Company, shall have furnished to you
their written opinion (a draft of the form of such opinion is attached as Annex I(b)
hereto), dated such Time of Delivery, in form and substance satisfactory to you;
(f) On the date of the Prospectus and also at each Time of Delivery, KPMG LLP
shall have furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you;
(g) (i) None of the CVR Parties shall have sustained since the date of the latest
audited financial statements included in the Pricing 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, in each case otherwise than as set
forth or contemplated in the Pricing Prospectus, and (ii) since the
22
respective dates as of
which information is given in the Pricing Prospectus there shall not have been any change
in the partners’ capital or members’ equity (as the case may be) or long-term debt of the
CVR Parties, taken together as a whole, or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial position,
partners’ capital or members’ equity (as the case may be) or results of operations of the
CVR Parties, taken together as a whole, otherwise than as set forth or contemplated in the
Pricing Prospectus, the effect of which, in any such case described in clause (i) or (ii),
is in your judgment so material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the LP Units being delivered at such
Time of Delivery on the terms and in the manner contemplated in the Prospectus;
(h) On or after the Applicable Time (i) no downgrading shall have occurred in the
rating accorded any debt securities or preferred stock of the Company or Operating LLC or
in the corporate rating of Company or Operating LLC by any “nationally recognized
statistical rating organization”, as that term is used in Rule 15c3-1(c)(2)(vi)(F) under
the Exchange Act, and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its rating of any debt
securities or preferred stock of the Company or Operating LLC or the corporate rating of
the Company or Operating LLC;
(i) On or after the Applicable Time there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities generally on
the Exchange; (ii) a suspension or material limitation in trading in the securities of the
Company on the Exchange; (iii) a general moratorium on commercial banking activities
declared by either Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the United States;
(iv) the outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war; or (v) the occurrence of
any other calamity or crisis or any change in financial, political or economic conditions
in the United States or elsewhere, if the effect of any such event specified in clause (iv)
or (v) in your judgment makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the LP Units being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus;
(j) The LP Units to be sold at such Time of Delivery shall have been duly listed,
subject to notice of issuance, on the Exchange;
(k) The Company shall have obtained and delivered to the Representatives on behalf
of the Underwriters executed copies of a Lock-up Agreement in a form heretofore furnished
by you from each director and
23
executive officer of each of the Company and Managing GP and
the additional parties named in Schedule III hereto;
(l) The Company shall have complied with the provisions of Section 5(c) hereof
with respect to the furnishing of prospectuses on the second New York Business Day next
succeeding the date of this Agreement;
(m) The Company shall have furnished or caused to be furnished to you at such Time
of Delivery a certificate of the chief executive officer and chief financial officer of the
Company or Managing GP to the effect that the representations and warranties of the CVR
Parties herein are true and correct at and as of such Time of Delivery and that the CVR
Parties have complied with all of the agreements and satisfied all of the conditions on
their respective parts to be performed or satisfied hereunder on or prior to such Time of
Delivery;
(n) Each of the Transactions shall have been consummated in a manner consistent in
all material respects with their description in the Pricing Prospectus (or otherwise shall
be consummated immediately after the closing of the offering);
(o) Concurrently with the First Time of Delivery, the Representatives shall have
received the Joinder Agreement duly executed and delivered by an authorized officer of
Managing GP; and
(p) The Chief Financial Officer of the Company or Managing GP shall have furnished
or caused to be furnished to you at such Time of Delivery a certificate satisfactory to you
as to the operating data for the first quarter ended March 31, 2011 included in the Pricing
Prospectus and the Prospectus.
9. (a) The CVR Parties, jointly and severally, (i) will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in the Registration Statement, any
Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or supplement
thereto, any Issuer Free Writing Prospectus or any “issuer information” (in the case of either an
Issuer Free Writing Prospectus or such “issuer information,” taken together with the Pricing
Prospectus) filed or required to be filed pursuant to Rule 433(d) under the Act, or arise out of or
are based upon the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and (ii) will reimburse
each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with investigating or defending
any such action or claim as such expenses are
24
incurred; provided, however, that the CVR Parties
shall not be liable in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement, any Preliminary Prospectus, the Pricing
Prospectus or the Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing
Prospectus, in reliance upon and in conformity with written information furnished to the Company by
any Underwriter through the Representatives for use therein.
(b) Each Underwriter will indemnify and hold harmless the CVR Parties against any losses,
claims, damages or liabilities to which the CVR Parties may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or the
Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing Prospectus, or arise
out of or are based upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading, in each case to
the extent, but only to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Registration Statement, any Preliminary Prospectus,
the Pricing Prospectus or the Prospectus, or any amendment or supplement thereto, or any Issuer
Free Writing Prospectus, in reliance upon and in conformity with written information furnished to
the Company by such Underwriter through the Representatives expressly for use therein; and will
reimburse the CVR Parties for any legal or other expenses reasonably incurred by the CVR Parties in
connection with investigating or defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of
notice of the commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection, notify the indemnifying
party in writing of the commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against any indemnified party and
it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified
party under such subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in
25
connection with the defense thereof
other than reasonable costs of investigation. No indemnifying party shall, without the written
consent of the indemnified party, effect the settlement or compromise of, or consent to the entry
of any judgment with respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the indemnified party is an
actual or potential party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 9 is unavailable to or
insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of
any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative benefits received by the CVR Parties on
the one hand and the Underwriters on the other from the offering of the LP Units. 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 under subsection (c) 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 CVR Parties on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or liabilities (or actions
in respect thereof), as well as any other relevant equitable considerations. The relative benefits
received by the CVR Parties 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 CVR Parties 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. 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 CVR Parties 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 CVR Parties and the Underwriters agree that it would
not be just and equitable if contribution pursuant to this subsection (d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the equitable considerations referred to
above in this subsection (d). The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by
26
such indemnified party in
connection with investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the LP Units underwritten by it and
distributed to the public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 10(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters’ obligations in this subsection (d)
to contribute are several in proportion to their respective underwriting obligations and not joint.
No party shall be liable for contribution under this subsection (d) except to the extent and under
such circumstances as such party would have been liable for indemnification under this Section 9 if
such indemnification were available or enforceable under applicable law.
(e) The obligations of the CVR Parties under this Section 9 shall be in addition to any
liability which the CVR Parties may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the meaning of the Act and
each broker-dealer affiliate of any Underwriter; and the obligations of the Underwriters under this
Section 9 shall be in addition to any liability which the respective Underwriters may otherwise
have and shall extend, upon the same terms and conditions, to the respective officers and directors
of the CVR Parties (including any person who, with his or her consent, is named in the Registration
Statement as about to become a director of the Company) and to each person, if any, who controls
the CVR Parties within the meaning of the Act.
10. (a) The CVR Parties, jointly and severally, agree to indemnify and hold harmless
Morgan Stanley, each person, if any, who controls Morgan Stanley within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act and each affiliate of Morgan Stanley within
the meaning of Rule 405 of the Act (the “Morgan Stanley Entities”) from and against any and all
losses, claims, damages and liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such action or claim) (i)
caused by any untrue statement or alleged untrue statement of a material fact contained in any
material prepared by or with the consent of any of the CVR Parties for distribution to Participants
in connection with the Directed Unit Program or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the statements therein
not misleading; (ii) caused by the failure of any Participant to pay for and accept delivery of
Directed Units that the Participant agreed to purchase; or (iii) related to, arising out of, or in
connection with the Directed Unit Program, other than losses, claims, damages or liabilities (or
expenses relating thereto) that are
finally judicially determined to have resulted from the bad faith or gross negligence of the
Morgan Stanley Entities.
27
(b) In case any proceeding (including any governmental investigation) shall be instituted
involving any Morgan Stanley Entity in respect of which indemnity may be sought pursuant to Section
10(a), the Morgan Stanley Entity seeking indemnity, shall promptly notify the Company in writing
and the Company, upon request of the Morgan Stanley Entity, shall retain counsel reasonably
satisfactory to the Morgan Stanley Entity to represent the Morgan Stanley Entity and any others the
Company may designate in such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any Morgan Stanley Entity shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of
such Morgan Stanley Entity unless (i) the Company shall have agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include
both the Morgan Stanley Entity and any of the CVR Parties and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing interests between them.
None of the CVR Parties, in respect of the legal expenses of the Morgan Stanley Entities in
connection with any proceeding or related proceedings in the same jurisdiction, shall be liable for
the fees and expenses of more than one separate firm (in addition to any local counsel) for all
Morgan Stanley Entities. Any such separate firm for the Morgan Stanley Entities shall be
designated in writing by Morgan Stanley. None of the CVR Parties shall be liable for any
settlement of any proceeding effected without its written consent, but if settled with such consent
or if there be a final judgment for the plaintiff, such CVR Party agrees to indemnify the Morgan
Stanley Entities from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time a Morgan Stanley Entity shall have requested
any CVR Party to reimburse it for fees and expenses of counsel as contemplated by the second and
third sentences of this paragraph, such CVR Party agrees that it shall be liable for any settlement
of any proceeding effected without its written consent if (i) such settlement is entered into more
than 30 days after receipt by such CVR Party of the aforesaid request and (ii) such CVR Party shall
not have reimbursed the Morgan Stanley Entity in accordance with such request prior to the date of
such settlement. None of the CVR Parties shall effect, without the prior written consent of Morgan
Stanley, any settlement of any pending or threatened proceeding in respect of which any Morgan
Stanley Entity is or could have been a party and indemnity could have been sought hereunder by such
Morgan Stanley Entity, unless such settlement includes an unconditional release of the Morgan
Stanley Entities from all liability on claims that are the subject matter of such proceeding.
(c) To the extent the indemnification provided for in Section 10(a) is unavailable to a
Morgan Stanley Entity or insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then the CVR Parties, jointly and
severally, in lieu of indemnifying the Morgan Stanley Entity thereunder, shall contribute to
the amount paid or payable by the Morgan Stanley Entity as a result of such losses, claims, damages
or liabilities (i) in such proportion as is
28
appropriate to reflect the relative benefits received
by the CVR Parties on the one hand and the Morgan Stanley Entities on the other hand from the
offering of the Directed Units or (ii) if the allocation provided by clause 10(c)(i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause 10(c)(i) above but also the relative fault of any of the CVR Parties
on the one hand and of the Morgan Stanley Entities on the other hand in connection with any
statements or omissions that resulted in such losses, claims, damages or liabilities, as well as
any other relevant equitable considerations. The relative benefits received by the CVR Parties on
the one hand and the Morgan Stanley Entities on the other hand in connection with the offering of
the Directed Units shall be deemed to be in the same respective proportions as the net proceeds
from the offering of the Directed Units (before deducting expenses) and the total underwriting
discounts and commissions received by the Morgan Stanley Entities for the Directed Units, bear to
the aggregate public offering price of the Directed Units. If the loss, claim, damage or liability
is caused by an untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact, the relative fault of the CVR Parties on the one hand and the
Morgan Stanley Entities on the other hand shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement or the omission or alleged omission relates to
information supplied by any of the CVR Parties or by the Morgan Stanley Entities and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(d) The CVR Parties and the Morgan Stanley Entities agree that it would not be just or
equitable if contribution pursuant to this Section 10 were determined by pro rata allocation (even
if the CVR Parties and the Morgan Stanley Entities were treated as one entity, respectively, for
such purpose) or by any other method of allocation that does not take account of the equitable
considerations referred to in Section 10(c). The amount paid or payable by the Morgan Stanley
Entities as a result of the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by the Morgan Stanley Entities in connection with
investigating or defending any such action or claim. Notwithstanding the provisions of this
Section 10, no Morgan Stanley Entity shall be required to contribute any amount in excess of the
amount by which the total price at which the Directed Units distributed to the public were offered
to the public exceeds the amount of any damages that such Morgan Stanley Entity has otherwise been
required to pay. The remedies provided for in this Section 10 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any indemnified party at law or in
equity.
(e) The indemnity and contribution provisions contained in this Section 10 shall remain
operative and in full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any
29
Morgan Stanley Entity or any of the CVR Parties,
their officers or directors or any person controlling such CVR Party and (iii) acceptance of and
payment for any of the Directed Units.
11. In making a claim for indemnification under Section 9 or 10 of this Agreement (other
than for any legal or other expenses reasonably incurred in connection with investigating or
defending any action or claim in accordance with clause (a)(ii) of Section 9 or the first sentence
of Section 10 (“Expense Reimbursement”), as further provided below) or contribution under Section 9
or 10 of this Agreement, by any of the CVR Parties, an indemnified party may proceed against either
(1) all of the CVR Parties jointly or (ii) the Company, Managing GP and Operating LLC jointly, but
may not proceed solely against Coffeyville Resources. Notwithstanding the provisions of Sections 9
and 10 of this Agreement, in making a claim for indemnification under Section 9 or 10 (other than
for an Expense Reimbursement), or contribution under Section 9 or 10, by any of the CVR Parties, as
a precondition to any indemnified party, including any Morgan Stanley Entity, obtaining
indemnification or contribution from Coffeyville Resources for any loss, claim, damage, liability
or expense under Section 9 or 10, such indemnified party shall first obtain a final judgment from a
trial court that such indemnified party is entitled to indemnity or contribution under this
Agreement with respect to such loss, claim, damage, liability or expense (the “Indemnity Final
Judgment”) from the Company, Managing GP, Operating LLC and Coffeyville Resources (or any of them)
and shall seek to satisfy such Indemnity Final Judgment in full from the Company, Managing GP and
Operating LLC by making a written demand upon the Company, Managing GP and Operating LLC for such
satisfaction. If such Indemnity Final Judgment shall remain unsatisfied in whole or in part 45
days following the date of receipt by the Company, Managing GP and Operating LLC of such demand,
any indemnified party shall have the right to take action to satisfy such Indemnity Final Judgment
by making demand directly on Coffeyville Resources (but only if and to the extent the Company,
Managing GP or Operating LLC have not already satisfied such Indemnity Final Judgment, whether by
settlement, release or otherwise). The indemnified parties may exercise this right to first seek
to obtain payment from the Company, Managing GP and Operating LLC and thereafter obtain payment
from Coffeyville Resources without regard to the pursuit by any party of its rights to the appeal
of such Indemnity Final Judgment. The indemnified parties shall, however, be relieved of their
obligation to first obtain an Indemnity Final Judgment, seek to obtain payment from the Company,
Managing GP and Operating LLC with respect to such Indemnity Final Judgment or, having sought such
payment, to wait such 45 days after failure by the Company, Managing GP and Operating LLC to
immediately satisfy any such Final Judgment if (i) the Company, Managing GP or Operating LLC files
a petition for relief under the
United States Bankruptcy Code (the “Bankruptcy Code”), (ii) an order for relief is entered
against the Company, Managing GP or Operating LLC in an involuntary case under the Bankruptcy Code
and such order is not dismissed within 60 days
30
after the filing thereof, (iii) the Company,
Managing GP or Operating LLC makes an assignment for the benefit of its creditors or (iv) any court
orders or approves the appointment of a receiver or custodian for the Company, Managing GP or
Operating LLC or a substantial portion of any of their assets and such appointment is not
discharged within 60 days after the effective date thereof. The foregoing provisions of this
paragraph are not intended to require any indemnified party to obtain an Indemnity Final Judgment
against the Company, Managing GP, Operating LLC or Coffeyville Resources before obtaining any
Expense Reimbursement. However, the indemnified parties shall first seek to obtain Expense
Reimbursement in full from the Company, Managing GP and Operating LLC by making a written demand
upon the Company, Managing GP and Operating LLC for such Expense Reimbursement. If such expenses
shall remain unreimbursed in whole or in part 45 days following the date of receipt by the Company,
Managing GP and Operating LLC of such demand, any indemnified party shall have the right to receive
Expense Reimbursement from Coffeyville Resources by making written demand directly on Coffeyville
Resources (but only if and to the extent the Company, Managing GP or Operating LLC have not already
satisfied the demand for such Expense Reimbursement, whether by settlement, release or otherwise).
The indemnified parties shall, however, be relieved of their obligation to first seek to obtain
such Expense Reimbursement in full from the Company, Managing GP and Operating LLC or, having made
written demand therefor, to wait such 45 days after failure by the Company, Managing GP and
Operating LLC to immediately reimburse such expenses if (i) the Company, Managing GP or Operating
LLC files a petition for relief under the Bankruptcy Code, (ii) an order for relief is entered
against the Company, Managing GP or Operating LLC in an involuntary case under the Bankruptcy Code,
(iii) the Company, Managing GP or Operating LLC makes an assignment for the benefit of its
creditors or (iv) any court orders or approves the appointment of a receiver or custodian for the
Company, Managing GP or Operating LLC or a substantial portion of any of their assets.
12. (a) If any Underwriter shall default in its obligation to purchase the LP Units which
it has agreed to purchase hereunder at a Time of Delivery, you may in your discretion arrange for
you or another party or other parties to purchase such LP Units on the terms contained herein. If
within thirty-six hours after such default by any Underwriter you do not arrange for the purchase
of such LP Units, 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 LP Units 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 LP Units, or the Company notifies you that it
has so arranged for the purchase of such LP Units, you or the Company shall have the right to
postpone such Time of Delivery 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 or
supplements to the Registration
31
Statement or the Prospectus which in your opinion may thereby be
made necessary. The term “Underwriter” as used in this Agreement shall include any person
substituted under this Section 12 with like effect as if such person had originally been a party to
this Agreement with respect to such LP Units.
(b) If, after giving effect to any arrangements for the purchase of the LP Units of a
defaulting Underwriter or Underwriters by you and the Company as provided in subsection (a) above,
the aggregate number of such LP Units which remains unpurchased does not exceed one-eleventh of the
aggregate number of all the LP Units to be purchased at such Time of Delivery, then the Company
shall have the right to require each non-defaulting Underwriter to purchase the number of LP Units
which such Underwriter agreed to purchase hereunder at such Time of Delivery and, in addition, to
require each non-defaulting Underwriter to purchase its pro rata share (based on the number of LP
Units which such Underwriter agreed to purchase hereunder) of the LP Units of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the LP Units of a
defaulting Underwriter or Underwriters by you and the Company as provided in subsection (a) above,
the aggregate number of such LP Units which remains unpurchased exceeds one-eleventh of the
aggregate number of all the LP Units to be purchased at such Time of Delivery, or if the Company
shall not exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase LP Units of a defaulting Underwriter or Underwriters, then this Agreement
(or, with respect to any Option Time of Delivery, the obligations of the Underwriters to purchase
and of the Company to sell the Optional LP Units) 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 and the Underwriters as provided in Section 7 hereof and the indemnity and contribution
agreements in Section 9 hereof; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
13. (a) The respective indemnities, agreements, representations, warranties and other
statements of the CVR Parties and the several Underwriters, as set forth in this Agreement or made
by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the CVR Parties, or any
officer or director or controlling person of any of the CVR Parties, and shall survive delivery of
and payment for the LP Units.
(b) In making a claim for breach by the CVR Parties of any agreement, representation or
warranty contained in this Agreement, any
Underwriter may proceed against either (i) all of the CVR Parties jointly or (ii) the Company,
Managing GP and Operating LLC jointly, but may not proceed solely against Coffeyville Resources.
As a precondition to any Underwriter obtaining
32
recovery of any loss, claim, damage, liability or
expense from Coffeyville Resources arising out of, or based upon or resulting from such breach,
such Underwriter shall first obtain a final judgment from a trial court that such Underwriter is
entitled to recovery under this Agreement with respect to such loss, claim, damage, liability or
expense (the “Breach Final Judgment”) from the Company, Managing GP, Operating LLC and Coffeyville
Resources (or any of them) and shall seek to satisfy such Breach Final Judgment in full from the
Company, Managing GP and Operating LLC by making a written demand upon the Company, Managing GP and
Operating LLC for such satisfaction. If such Breach Final Judgment shall remain unsatisfied in
whole or in part 45 days following the date of receipt by the Company, Managing GP and Operating
LLC of such demand, any Underwriter shall have the right to take action to satisfy such Breach
Final Judgment by making demand directly on Coffeyville Resources (but only if and to the extent
the Company, Managing GP or Operating LLC have not already satisfied such Breach Final Judgment,
whether by settlement, release or otherwise). The Underwriters may exercise this right to first
seek to obtain payment from the Company, Managing GP and Operating LLC and thereafter obtain
payment from Coffeyville Resources without regard to the pursuit by any party of its rights to the
appeal of such Breach Final Judgment. The Underwriters shall, however, be relieved of their
obligation to first obtain a Breach Final Judgment, seek to obtain payment from the Company,
Managing GP and Operating LLC with respect to such Breach Final Judgment or, having sought such
payment, to wait such 45 days after failure by the Company, Managing GP and Operating LLC to
immediately satisfy any such Breach Final Judgment if (i) the Company, Managing GP or Operating LLC
files a petition for relief under the Bankruptcy Code, (ii) an order for relief is entered against
the Company, Managing GP or Operating LLC in an involuntary case under the Bankruptcy Code and such
order is not dismissed within 60 days after the filing thereof, (iii) the Company, Managing GP or
Operating LLC makes an assignment for the benefit of its creditors or (iv) any court orders or
approves the appointment of a receiver or custodian for the Company, Managing GP or Operating LLC
or a substantial portion of any of their assets and such appointment is not discharged within 60
days after the effective date thereof.
(c) Notwithstanding anything in this Agreement to the contrary, Coffeyville Resources’
aggregate liability pursuant to the indemnity and contribution provisions of Sections 9 and 10
hereof and for any breach by the CVR Parties of any agreement, representation or warranty contained
in this Agreement shall not exceed an amount equal to the sum of (x) (i) the proceeds of the
offering of the Firm Units that the Company distributes to Coffeyville Resources, (ii) the portion
of the term loan under the New Credit Facility that the Company distributes to Coffeyville
Resources and (iii) an amount equal to the total of the Company’s cash and cash equivalents on the
Company’s consolidated
balance sheet as of the day immediately preceding the First Time of Delivery that the Company
distributes to Coffeyville Resources, as certified in writing to the Representatives by the chief
financial officer of the Company or Managing GP as
33
of the First Time of Delivery, and (y) an
amount, if any, equal to the purchase price paid by the Underwriters for Optional LP Units to the
extent any of such proceeds are distributed to Coffeyville Resources.
14. If this Agreement shall be terminated pursuant to Section 12 hereof, the CVR Parties
shall not then be under any liability to any Underwriter except as provided in Sections 7 and 9
hereof; but, if for any other reason any LP Units are not delivered by or on behalf of the Company
as provided herein (other than due to the failure to satisfy any of the conditions provided in
clauses (i), (iii), (iv) or (v) of Section 8(i) hereof), the CVR Parties will cause the Company to
reimburse the Underwriters through you for all out-of-pocket expenses approved in writing by you,
including fees and disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the LP Units not so delivered, but the CVR
Parties shall not then be under any further liability to any Underwriter except as provided in
Sections 7 and 9 hereof.
15. In all dealings hereunder, you, as the Representatives, shall act on behalf of each of
the Underwriters, and the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or given by all of the Underwriters
jointly or by the Representatives on behalf of the Underwriters.
16. All statements, requests, notices and agreements hereunder shall be in writing, and if
to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to you as
the Representatives to each of (i) Morgan Stanley & Co. Incorporated, Attention Global Capital
Markets Syndicate Desk, 1585 Broadway, New York, New York
10036; (ii) Barclays Capital Inc., 745
Seventh Avenue, New York, New York 10019, Attention: Syndicate Registration (Facsimile:
646-834-8133); and (iii) Goldman, Sachs & Co., 200 West Street, New York, New York 10282,
Attention: Registration Department (Facsimile: 212-902-9316), with a copy, in the case of any
notice pursuant to Section 13 hereof, to the Director of Litigation, Office of the General Counsel,
Barclays Capital Inc., 745 Seventh Avenue, New York, New York 10019; if to Morgan Stanley in
connection with the Directed Unit Program shall be delivered or sent by mail, telex or facsimile
transmission to Morgan Stanley & Co. Incorporated, Attention Global Capital Markets Syndicate Desk,
1585 Broadway, New York, New York 10036; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an Underwriter pursuant to
subsection 9(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its Underwriters’ Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by you upon request; provided,
however, that notices under subsection 9(c) shall be in writing, and if to the
Underwriters
shall be delivered or sent by mail, telex or facsimile transmission to you as the
Representatives to each of (i) Morgan Stanley & Co. Incorporated, Attention Global Capital Markets
Syndicate Desk, 1585 Broadway, New York, New York
34
10036; (ii) Barclays Capital Inc., 745 Seventh
Avenue, New York, New York 10019, Attention: Syndicate Registration (Facsimile: 646-834-8133); and
(iii) Goldman, Sachs & Co., 200 West Street, New York, New York 10282, Attention: Registration
Department (Facsimile: 212-902-9316). Any such statements, requests, notices or agreements shall
take effect upon receipt thereof.
17. This Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters and the CVR Parties and, to the extent provided in Sections 9 and 13 hereof, the
officers and directors of the CVR Parties and each person who controls the CVR Parties or any
Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the LP Units from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
18. Time shall be of the essence of this Agreement. As used herein, the term “business
day” shall mean any day when the Commission’s office in Washington, D.C. is open for business.
19. The CVR Parties acknowledge and agree that (i) the purchase and sale of the LP Units
pursuant to this Agreement is an arm’s-length commercial transaction between the CVR Parties, on
the one hand, and the several Underwriters, on the other; (ii) in connection therewith and with the
process leading to such transaction each Underwriter is acting solely as a principal and not the
agent or fiduciary of any of the CVR Parties; (iii) no Underwriter has assumed an advisory or
fiduciary responsibility in favor of any of the CVR Parties with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has
advised or is currently advising any of the CVR Parties on other matters) or any other obligation
to any of the CVR Parties except the obligations expressly set forth in this Agreement; and (iv)
the CVR Parties have consulted their own legal and financial advisors to the extent it deemed
appropriate. The CVR Parties agree that they will not claim that the Underwriters, or any of them,
have rendered advisory services of any nature or respect, or owe a fiduciary or similar duty to any
of the CVR Parties in connection with such transaction or the process leading thereto.
20. This Agreement supersedes all prior agreements and understandings (whether written or
oral) between the CVR Parties and the Underwriters, or any of them, with respect to the subject
matter hereof.
21. This Agreement shall be governed by and construed in accordance with the laws of the
State of New York.
22. Each of the CVR Parties and each of the Underwriters hereby irrevocably waives, to the
fullest extent permitted by applicable law, any and all
right to trial by jury in any legal proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby, including the Transactions.
35
23. This Agreement may be executed by any one or more of the parties hereto in any number
of counterparts, each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign and return to us two
counterparts hereof, and upon the acceptance hereof by you, on behalf of each of the Underwriters,
this letter and such acceptance hereof shall constitute a binding agreement among each of the
Underwriters and the CVR Parties. It is understood that your acceptance of this letter 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 upon request, but
without warranty on your part as to the authority of the signers thereof.
[Remainder of this page intentionally left blank]
36
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Very truly yours,
CVR Partners, LP
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By: |
CVR GP, LLC, its Managing General Partner
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By: |
/s/ John J. Lipinski
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Name: |
John J. Lipinski |
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Title: |
Chief Executive Officer and
President |
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By: |
CVR Special GP, LLC, its Special General Partner
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By: |
/s/ John J. Lipinski
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Name: |
John J. Lipinski |
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Title: |
Chief Executive Officer and
President |
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Coffeyville Resources Nitrogen
Fertilizers, LLC
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By: |
/s/ John J. Lipinski
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| |
|
Name: |
John J. Lipinski |
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Title: |
Chief Executive Officer and
President |
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Coffeyville Resources, LLC
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By: |
/s/ John J. Lipinski
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| |
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Name: |
John J. Lipinski |
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Title: |
Chief Executive Officer and
President |
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CVR Partners, LP Underwriting Agreement Signature Page
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Accepted as of the date hereof:
Morgan Stanley & Co. Incorporated
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| By: |
/s/ Kathryn Bergsteinsson
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Name: |
Kathryn Bergsteinsson |
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Title: |
Vice President |
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Barclays Capital Inc.
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| By: |
/s/ Victoria Hale
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Name: |
Victoria Hale |
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Title: |
Vice President |
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Goldman, Sachs & Co.
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| By: |
/s/ Goldman, Sachs & Co.
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(Goldman, Sachs & Co.) |
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On behalf of each of the Underwriters
CVR Partners, LP Underwriting Agreement Signature Page
SCHEDULE I
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Number of Optional |
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LP Units to be |
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Total Number of |
|
|
Purchased if |
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| |
|
Firm LP Units to be |
|
|
Maximum Option |
|
| Underwriter |
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Purchased |
|
|
Exercised |
|
Morgan Stanley & Co. Incorporated |
|
|
6,780,480 |
|
|
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1,017,072 |
|
Barclays Capital Inc. |
|
|
6,780,480 |
|
|
|
1,017,072 |
|
Goldman, Sachs & Co. |
|
|
4,026,240 |
|
|
|
603,936 |
|
Dahlman Rose & Company, LLC |
|
|
403,200 |
|
|
|
60,480 |
|
RBS Securities Inc. |
|
|
403,200 |
|
|
|
60,480 |
|
Simmons & Company International |
|
|
403,200 |
|
|
|
60,480 |
|
SunTrust Robinson Humphrey, Inc. |
|
|
403,200 |
|
|
|
60,480 |
|
|
|
|
|
|
|
|
Total |
|
|
19,200,000 |
|
|
|
2,880,000 |
|
|
|
|
|
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SCHEDULE IIA
Initial public offering price per Common Unit $16.00
SCHEDULE IIB
Issuer Free Writing Prospectuses
Electronic road show as filed on Netroadshow.com (the “Electronic Roadshow”) on March 29, 2011.
Schedule III
Persons and Entities Subject to Lock-Up Letters
Coffeyville Resources, LLC
CVR GP, LLC
John J. Lipinski
The Lipinski 2011 Exempt Family Trust
Stanley A. Riemann
Edward Morgan
Edmund S. Gross
Kevan A. Vick
Christopher G. Swanberg
Donna R. Ecton
Scott Lebovitz
George E. Matelich
Frank M. Muller, Jr.
Stanley de J. Osborne
John K. Rowan
