Pioneer Southwest Energy Partners L.P. - Current report filing (8-K)
May 09 2008 - 4:14PM
Edgar (US Regulatory)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
May 6, 2008
PIONEER SOUTHWEST ENERGY PARTNERS L.P.
(Exact name of registrant as specified in its charter)
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Delaware
(State or other
jurisdiction of incorporation)
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001-34032
(Commission File Number)
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26-0388421
(I.R.S. Employer
Identification Number)
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5205 N. OConnor Blvd
Suite 200
Irving, Texas
(Address of principal
executive offices)
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75039
(Zip code)
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Registrants telephone number, including area code:
(972) 444-9001
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the Registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01. Entry into a Material Definitive Agreement.
General
As previously reported in a Current Report on Form 8-K filed with the Securities and Exchange
Commission (the Commission) on April 30, 2008, Pioneer Southwest Energy Partners L.P. (the
Partnership), Pioneer Natural Resources GP LLC (the General Partner), Pioneer Natural Resources
Company (Pioneer), Pioneer Natural Resources USA, Inc. (Pioneer USA) and Pioneer Southwest
Energy Partners USA LLC (the Operating Company and, together with the Partnership, the General
Partner, Pioneer and Pioneer USA, the Pioneer Parties) entered into an Underwriting Agreement
(the Underwriting Agreement) with Deutsche Bank Securities Inc., Citigroup Global Markets Inc.
and UBS Securities LLC, as representatives of the several underwriters identified therein
(collectively, the Underwriters), providing for the offer and sale in a firm commitment
underwritten offering (the Offering) of 8,250,000 common units representing limited partner
interests in the Partnership (Common Units), at a price of $19.00 per Common Unit ($17.67 per
Common Unit, net of underwriting discount). Pursuant to the Underwriting Agreement, the Partnership
granted the Underwriters a 30-day option to buy up to an aggregate of 1,237,500 additional Common
Units at the same price, which was exercised in full by the Underwriters on May 2, 2008. The
transactions contemplated by the Underwriting Agreement closed on May 6, 2008.
In the Underwriting Agreement, the Partnership agreed to indemnify the Underwriters against
certain liabilities, including liabilities under the Securities Act of 1933, as amended (the
Securities Act), or to contribute to payments the Underwriters may be required to make because of
any of those liabilities.
Contribution Agreement
On May 6, 2008, the Partnership entered into the Contribution Agreement (the Contribution
Agreement) with the General Partner and Pioneer USA. Following to the closing of the Offering,
the following transactions, among others, occurred pursuant to the Contribution Agreement:
(i) Pioneer USA contributed a 0.10295172491645% membership interest in the Operating Company
to the General Partner as an additional capital contribution;
(ii) Pioneer USA contributed a 73.3573936581775% membership interest in the Operating Company
to the Partnership in exchange for 20,521,200 Common Units representing a 71.254% limited partner
interest in the Partnership; and
(iii) the General Partner contributed a 0.10295172491645% membership interest in the Operating
Company to the Partnership in exchange for a continuation of the General Partners .1% general
partner interest in the Partnership.
These contributions were made in a series of steps outlined in the Contribution Agreement. As
noted below in this Item 1.01, the Partnership has certain relationships with certain parties to
the Contribution Agreement. The amount of consideration paid in connection with the
transactions contemplated by the Contribution Agreement was determined through the pricing of the
Common Units by the Underwriters in the public market. Pioneer USA and the General Partner made no
representations or warranties with respect to the membership interests contributed pursuant to the
Contribution Agreement. The foregoing description of the Contribution Agreement is not complete
and is qualified in its entirety by reference to the Contribution Agreement, which is filed as
Exhibit 2.1 to this Form 8-K and is incorporated by reference into this Item 1.01.
Membership Interest Sale Agreement
On May 6, 2008, the Partnership entered into the Membership Interest Sale Agreement (the MIS
Agreement) with Pioneer USA. Pursuant to the MIS Agreement, following the closing of the Offering,
the Partnership, among other things, acquired a 26.5396546169060% membership interest in the
Operating Company for a purchase price of $141,061,250 in cash. The transactions contemplated by
the Contribution Agreement and the MIS Agreement occurred as component parts of
a single plan, pursuant to which the Partnership acquired all of the membership interests of the
Operating Company and became its sole member. As noted below in this Item 1.01, the Partnership
has certain relationships with certain parties to the MIS Agreement. The amount of consideration
paid in connection with the transactions contemplated by the MIS Agreement was determined
through the pricing of the Common Units by the Underwriters in the public market. The source of
the funds for the purchase price under the MIS Agreement was the proceeds of the Offering. Pioneer
USA made no representations or warranties with respect to the membership interests sold pursuant to
the MIS Agreement. The foregoing description of the MIS Agreement is not complete and is qualified
in its entirety by reference to the MIS Agreement, which is filed as Exhibit 2.2 to this Form 8-K
and is incorporated by reference into this Item 1.01.
Purchase and Sale Agreement
On May 6, 2008, the Operating Company entered into the Purchase and Sale Agreement (the
Purchase Agreement) with Pioneer USA and Pioneer Retained Properties Company LLC (the Retained
Company). Following the closing of the transactions contemplated by the Contribution Agreement
and the MIS Agreement, the Operating Company acquired certain wellbores and related assets and
liabilities held by the Retained Company for a purchase price of $22,007,724 in cash. As noted
below in this Item 1.01, the Partnership has certain relationships with certain parties to the
Purchase Agreement. The amount of consideration paid in connection with the transactions
contemplated by the Purchase Agreement was determined through the pricing of the Common Units by
the Underwriters in the public market. The source of funds for the purchase price under the
Purchase Agreement was the proceeds obtained from the exercise of the Underwriters over-allotment
option under the Underwriting Agreement and an additional
contribution by the General Partner to the Partnership, all of which
was contributed by the Partnership to the Operating Company. Pioneer USA and the Retained Company made no
representations or warranties with respect to the assets sold pursuant to the Purchase Agreement.
The foregoing description of the Purchase Agreement is not complete and is qualified in its
entirety by reference to the Purchase Agreement, which is filed as Exhibit 2.3 to this Form 8-K and
is incorporated by reference into this Item 1.01.
Omnibus Agreement
On May 6, 2008, the Partnership entered in an Omnibus Agreement (the Omnibus Agreement) with
the General Partner, Pioneer, Pioneer USA and the Operating Company. The description of the
material terms of the Omnibus Agreement contained in the section entitled Certain Relationships
and Related Party TransactionsOmnibus Agreement of the Partnerships final prospectus dated April
30, 2008 (File No. 333-144868) and filed on May 1, 2008 with the Securities Exchange Commission
pursuant to Rule 424(b)(4) under the Securities Act of 1933 (the Prospectus) is incorporated
herein by reference. As noted in the Prospectus and below in this Item 1.01, the Partnership has
certain relationships with certain parties to the Omnibus Agreement. The description of the
Omnibus Agreement in the Prospectus is not complete and is qualified in its entirety by reference
to the Omnibus Agreement, which is filed as Exhibit 2.4 to this Form 8-K and is incorporated by
reference into this Item 1.01.
Long-Term Incentive Plan
In connection with the Offering, the board of directors of the General Partner adopted the
Pioneer Southwest Energy Partners L.P. 2008 Long-Term Incentive Plan (the Plan) for directors,
employees and consultants of the General Partner and its affiliates who perform services for the
Partnership. The description of the material terms of the Plan contained in the section entitled
ManagementLong Term
Incentive Plan of the Prospectus is incorporated herein by reference. The description of the
Plan in the Prospectus is not complete and is qualified in its entirety by reference to the Plan,
which is filed as Exhibit 10.1 to this Form 8-K and is incorporated by reference into this Item
1.01.
Administrative Services Agreement
On May 6, 2008, the Partnership entered into an Administrative Services Agreement (the
Administrative Services Agreement) with the General Partner, the Operating Company and Pioneer
USA. The description of the material terms of the Administrative Services Agreement contained in
the section entitled Certain Relationships and Related Party TransactionsAdministrative Services
Agreement of the Prospectus is incorporated herein by reference. As noted in the Prospectus and
below in this Item 1.01, the Partnership has certain relationships with certain parties to the
Administrative Services Agreement. The description of the Administrative Services Agreement in the
Prospectus is not complete and is qualified in its entirety by reference to the Administrative
Services Agreement, which is filed as Exhibit 10.2 to this Form 8-K and is incorporated by
reference into this Item 1.01.
Tax Sharing Agreement
On May 6, 2008, the Partnership entered into a Tax Sharing Agreement (the Tax Sharing
Agreement) with Pioneer. The description of the material terms of the Tax Sharing Agreement
contained in the section entitled Certain Relationships and Related Party TransactionsTax Sharing
Agreement of the Prospectus is incorporated herein by reference. As noted in the Prospectus and
below in this Item 1.01, the Partnership has certain relationships with certain parties to the Tax
Sharing Agreement. The description of the Tax Sharing Agreement in the Prospectus is not complete
and is qualified in its entirety by reference to the Tax Sharing Agreement, which is filed as
Exhibit 10.3 to this Form 8-K and is incorporated by reference into this Item 1.01.
Omnibus Operating Agreement
On May 6, 2008, the Operating Company entered into an Omnibus Operating Agreement (the
Omnibus Operating Agreement) with Pioneer USA. The description of the material terms of the
Omnibus Operating Agreement contained in the section entitled Certain Relationships and Related
Party TransactionsOmnibus Operating Agreement of the Prospectus is incorporated herein by
reference. As noted in the Prospectus and below in this Item 1.01, the Partnership has certain
relationships with certain parties to the Omnibus Operating Agreement. The description of the
Omnibus Operating Agreement in the Prospectus is not complete and is qualified in its entirety by
reference to the Omnibus Operating Agreement, which is filed as Exhibit 10.4 to this Form 8-K and
is incorporated by reference into this Item 1.01.
Relationships
As more fully described in the section entitled Certain Relationships and Related Party
Transactions of the Prospectus, which is incorporated herein by reference, each of the
Partnership, the General Partner, the Operating Company, Pioneer USA and the Retained Company are
direct or indirect subsidiaries of Pioneer. As a result, certain individuals, including officers
and directors of Pioneer, Pioneer USA and the General Partner, serve as officers and/or directors
of more than one of such entities. As described above in this
Item 1.01, the General Partner holds a
0.1% general partner interest in the Partnership and Pioneer USA owns
a 71.254% limited partner interest in the Partnership. Certain of the Underwriters and their affiliates
have performed investment banking, commercial banking and advisory services for the Pioneer Parties
for which they have received customary fees and expenses. The Underwriters and their affiliates may
in the future perform investment banking and advisory services for the Pioneer Parties from time to
time for which they may in the future receive customary fees and expenses. The description of the
relationships among the Pioneer Parties and the
Underwriters contained in the section entitled Underwriting of the Prospectus is
incorporated herein by reference.
Item 2.01 Completion of Acquisition or Disposition of Assets.
Contribution Agreement
The description of the Contribution Agreement described under Item 1.01 is incorporated in
this Item 2.01 by reference. A copy of the Contribution Agreement is filed as Exhibit 2.1 to this
Form 8-K and is incorporated by reference into this Item 2.01.
Membership Interest Sale Agreement
The description of the MIS Agreement described under Item 1.01 is incorporated in this Item
2.01 by reference. A copy of the MIS Agreement is filed as Exhibit 2.2 to this Form 8-K and is
incorporated by reference into this Item 2.01.
Purchase and Sale Agreement
The description of the Purchase Agreement described under
Item 1.01 is incorporated in this Item 2.01 by reference. A copy of the Purchase Agreement is filed
as Exhibit 2.3 to this Form 8-K and is incorporated by reference into this Item 2.01.
Item 3.02 Unregistered Sales of Equity Securities.
The description in Item 1.01 above of the issuance by the Partnership on May 6, 2008 in
connection with the consummation of the transactions contemplated by the Contribution Agreement of
20,521,200 Common Units to Pioneer USA is incorporated herein by reference. The foregoing
transaction was undertaken in reliance upon the exemption from the registration requirements of the
Securities Act afforded by Section 4(2) thereof.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Changes in Fiscal Year.
First Amended and Restated Agreement of Limited Partnership of Pioneer Southwest Energy Partners
L.P.
On May 6, 2008, the Partnership amended and restated its Agreement of Limited Partnership in
connection with the closing of the Offering. The description of the First Amended and Restated
Agreement of Limited Partnership contained in the section entitled The Partnership Agreement of
the Prospectus is incorporated herein by reference. A copy of the First Amended and Restated
Agreement of Limited Partnership is filed as Exhibit 3.1 to this Form 8-K and is incorporated by
reference into this Item 5.03.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
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2.1
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Contribution Agreement, dated May 6, 2008, by and among the
Partnership, Pioneer USA and the General Partner.
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2.2
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Membership Interest Sale Agreement, dated May 6, 2008, by and
among the Partnership and Pioneer USA.
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2.3
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Purchase and Sale Agreement, dated May 6, 2008, by and among
Pioneer USA, the Operating Company and the Retained Company.
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2.4
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Omnibus Agreement, dated May 6, 2008, by and among the
Partnership, Pioneer USA, Pioneer, the Operating Company and the General
Partner.
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3.1
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First Amended and Restated Agreement of Limited Partnership of
Pioneer Southwest Energy Partners L.P., dated May 6, 2008.
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10.1
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Pioneer Southwest Energy Partners L.P. 2008 Long Term Incentive
Plan (incorporated by reference to Exhibit 10.2 to the Partnerships Amendment
No. 6 to Registration Statement on Form S-1, File No. 333-144868, filed with
the SEC on March 31, 2008).
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10.2
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Administrative Services Agreement, dated May 6, 2008, by and
among the Partnership, Pioneer USA, the Operating Company and the General
Partner.
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10.3
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Tax Sharing Agreement, dated May 6, 2008, by and among the
Partnership and Pioneer.
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10.4
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Omnibus Operating Agreement, dated May 6, 2008, by and among
Pioneer USA and the Operating Company.
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Pursuant
to the rules of the Commission, the schedules and similar attachments
to the agreement have not been filed herewith. The registrant agrees
to furnish supplementally a copy of any omitted schedule to the
Commission upon request.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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PIONEER
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SOUTHWEST ENERGY PARTNERS L.P.
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By:
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Pioneer Natural Resources GP LLC,
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its general partner
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By:
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/s/ Richard P. Dealy
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Name:
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Richard P. Dealy
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Title:
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Executive Vice President, Chief
Financial Officer and Treasurer
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Dated: May 9, 2008
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EXHIBIT INDEX
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Exhibit
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Number
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Exhibit Title
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2.1
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Contribution Agreement, dated May 6, 2008, by and among the Partnership,
Pioneer USA and the General Partner.
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2.2
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Membership Interest Sale Agreement, dated May 6, 2008, by and among the
Partnership and Pioneer USA.
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2.3*
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Purchase and Sale Agreement, dated May 6, 2008, by and among Pioneer USA, the
Operating Company and the Retained Company.
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2.4*
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Omnibus Agreement, dated May 6, 2008, by and among the Partnership, Pioneer
USA, Pioneer, the Operating Company and the General Partner.
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3.1
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First Amended and Restated Agreement of Limited Partnership of Pioneer
Southwest Energy Partners L.P., dated May 6, 2008.
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10.1
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Pioneer Southwest Energy Partners L.P. 2008 Long Term Incentive Plan
(incorporated by reference to Exhibit 10.2 to the Partnerships Amendment No. 6 to
Registration Statement on Form S-1, File No. 333-144868, filed with the SEC on March
31, 2008).
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10.2
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Administrative Services Agreement, dated May 6, 2008, by and among the
Partnership, Pioneer USA, the Operating Company and the General Partner.
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10.3
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Tax Sharing Agreement, dated May 6, 2008, by and among the Partnership and
Pioneer.
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10.4
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Omnibus Operating Agreement, dated May 6, 2008, by and among Pioneer USA and
the Operating Company.
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Pursuant
to the rules of the Commission, the schedules and similar attachments
to the agreement have not been filed herewith. The registrant agrees
to furnish supplementally a copy of any omitted schedule to the
Commission upon request.
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