Item 1.01 Entry into a Material Definitive Agreement.
On November 17, 2016, Emerge Energy Services LP (the Partnership), Emerge Energy GP, LLC, (the General Partner) and Emerge Energy Services Operating, LLC (Operating, and together with the Partnership and the General Partner, the Partnership Parties), entered into an Underwriting Agreement (the Underwriting Agreement) among the Partnership Parties and J.P. Morgan Securities LLC and Piper Jaffray & Co., as the representatives of the underwriters named therein (the Underwriters) providing for the offer and sale by the Partnership (the Offering), and the purchase by the Underwriters, of 3,400,000 common units (the Firm Units) representing limited partner interests (the Common Units) in the Partnership, at a price to the public of $10.00 per Common Unit. Pursuant to the Underwriting Agreement, the Partnership also granted to the Underwriters the option for a period of 30 days to purchase up to an additional 510,000 Common Units on the same terms.
The material terms of the Offering are described in the prospectus, dated November 17, 2016 (the Prospectus), filed by the Partnership with the United States Securities and Exchange Commission (the Commission) on November 21, 2016 pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended (the Act). The Offering was registered with the Commission pursuant to a Registration Statement on Form S-1, as amended (File No. 333-214237), initially filed by the Partnership on October 25, 2016.
The Underwriting Agreement contains customary representations, warranties and agreements of the Partnership Parties, and customary conditions to closing, obligations of the parties and termination provisions. The Partnership Parties have agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Act, or to contribute to payments the Underwriters may be required to make because of any of those liabilities.
The Offering closed on November 23, 2016. The Partnership received proceeds (net of underwriting discounts but before offering expenses) from the Offering of approximately $32.3 million. As described in the Prospectus, the Partnership will use the net proceeds from the sale of the Firm Units to repay outstanding borrowings under its amended and restated revolving credit and security agreement, dated as of June 27, 2014 (as amended, the revolving credit facility). Amounts repaid under the revolving credit facility may be reborrowed from time to time, subject to the terms of the revolving credit facility.
As more fully described under the caption Underwriting in the Prospectus, the Underwriters or certain of its affiliates have performed commercial banking, investment banking and advisory services for the Partnership Parties and their respective affiliates from time to time for which they have received customary fees and reimbursement of expenses. The Underwriters or its affiliates may, from time to time, engage in transactions with and perform services for the Partnership Parties and their respective affiliates in the ordinary course of their business for which they may receive customary fees and reimbursement of expenses.
The foregoing description of the Underwriting Agreement is not complete and is qualified in its entirety by reference to the full text of the Underwriting Agreement, which is attached as Exhibit 1.1 to this Current Report on Form 8-K and incorporated in this Item 1.01 by reference.