Item 1.01 Entry into a Material Definitive Agreement.
NGL Energy Partners LP
(the "Partnership") and NGL Energy Finance Corp.
," and together with the Partnership, the "Issuers") previously
announced their entry into a purchase agreement with RBS Securities Inc.
representative of the initial purchasers listed on Schedule1 to the purchase
agreement (collectively, the "Initial Purchasers") related to the issuance and
sale by the Issuers to the Initial Purchasers of $400,000,000
principal amount of the Issuers' 5.125% Senior Notes due 2019 (the "Notes"). The
Issuers' obligations under the Notes are fully and unconditionally guaranteed
(the "Guarantees") on a senior unsecured basis, jointly and severally, by each
of the Partnership's current and future restricted subsidiaries (other than
) that incur or guarantee indebtedness under certain of the
Partnership's other indebtedness, including the Partnership's existing senior
secured revolving credit facility (collectively, the "Guarantors," and together
with the Issuers, the "Obligors").
The Notes and the Guarantees (collectively, the "Securities") were issued
pursuant to an indenture (the "Indenture"), dated July 9, 2014
, by and among the
and U.S. Bank National Association
, as trustee (the "Trustee"). The
Notes accrue interest from July 9, 2014
at a rate of 5.125% per year. Interest
on the Notes is payable semi-annually in arrears on January 15
and July 15
each year, beginning January 15, 2015
. The Notes mature on July 15, 2019
On or after June 15, 2019
, the Issuers may redeem all or part of the Notes at a
redemption price equal to 100% of the principal amount of the notes redeemed
plus accrued and unpaid interest, if any, on the notes redeemed to but excluding
the redemption date. Prior to June 15, 2019
, the Issuers may redeem all or a
part of the Notes at a redemption price equal to the Make-Whole Price, subject
to the rights of holders of Notes on the relevant record date to receive
interest due on the relevant interest payment date.
''Make-Whole Price'' with respect to any Notes to be redeemed, means an amount
equal to the greater of:
(1) 100% of the principal amount of such Note, and
(2) the sum of the present values of (a) 100% of the principal amount of such
Notes and (b) the remaining scheduled payments of interest from the redemption
date to June 15, 2019
(not including any portion of such payments of interest
accrued as of the redemption date) discounted back to the redemption date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate (as defined in the Indenture) plus 50 basis points;
plus, in the case of both (1) and (2), accrued and unpaid interest on such
Notes, if any, to the redemption date.
If the Issuers experience certain kinds of changes of control, holders of the
Notes will be entitled to require the Partnership to repurchase all or any part
(equal to $2,000
or an integral multiple of $1,000
in excess of $2,000
) of that
holder's Notes pursuant to an offer on the terms set forth in the Indenture.
The Partnership will offer to make a cash payment equal to 101% of the aggregate
principal amount of the Notes repurchased plus accrued and unpaid interest on
the Notes repurchased to the date of purchase, subject to the rights of holders
of the Notes on the relevant record date to receive interest due on the relevant
interest payment date. Upon an event of default under the Indenture, the
Trustee or the holders of at least 25% in aggregate principal amount of the
Notes then outstanding may declare all amounts owing under the Notes to be due
A copy of the Indenture is filed as Exhibit 4.1 hereto, and the form of the
Global Notes included as Exhibits A1 and A2 to the Indenture are filed as
Exhibit 4.2 hereto, and each is incorporated herein by reference. The
description of the Indenture and the Securities in this Form 8-K is a summary
and is qualified in its entirety by the terms of the Indenture.
Registration Rights Agreement
On July 9, 2014
, in connection with the closing of this offering of the Notes,
the Obligors entered into a registration rights agreement with RBS Securities
, as representative of the Initial Purchasers (the "Registration Rights
Agreement"). Under the Registration Rights Agreement, the Obligors have agreed
to, among other things, use their commercially reasonable efforts to (i) file an
exchange offer registration statement with respect to the exchange notes and the
exchange guarantees, (ii) cause such exchange offer registration statement to
become effective on or prior to 365 days after the closing of this offering and
(iii) keep such exchange offer registration statement effective continuously and
keep the exchange offer period open for a period of not less than the period
required under applicable United States
federal and state securities laws to
consummate the exchange offer (provided that such period shall not be less than
20 business days after the date on which the notice of the exchange offer is
mailed to holders of the Notes). If, among other things, such exchange offer
registration statement is not filed or declared effective by the Securities and
by the required time, or the exchange offer has not been
consummated within 30 business days following the targeted date of effectiveness
(as set forth in the Registration Rights Agreement), the Obligors will be
required to pay to the holders of the Notes liquidated damages in an amount
equal to 0.25% per annum on the principal amount of the Notes held by such
holder during the 90-day period immediately following the occurrence of such
registration default, and such amount shall increase by 0.25% per annum at the
end of such 90-day period.
A copy of the Registration Rights Agreement is filed as Exhibit 4.3 hereto and
is incorporated herein by reference. The description of the Registration Rights
Agreement in this Form 8-K is a summary and is qualified in its entirety by the
terms of the Registration Rights Agreement.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a Registrant.
The information included in Item 1.01 of this Current Report on Form 8-K is
incorporated by reference into this Item 2.03 of this Current Report on
Item 9.01 Financial Statements and Exhibits.
4.1 Indenture, dated as of July 9, 2014, by and among NGL Energy Partners
LP, NGL Energy Finance Corp., the guarantors party thereto and U.S. Bank
National Association, as trustee.
4.2 Forms of 5.125% Senior Notes due 2019 (included as Exhibits A1 and A2 to
Exhibit 4.1 of this Current Report on Form 8-K).
4.3 Registration Rights Agreement, dated as of July 9, 2014, by and among
NGL Energy Partners LP, NGL Energy Finance Corp., the guarantors listed
therein on Exhibit A and RBS Securities Inc. as representative of the
several initial purchasers.