Item 1.01.
|
Entry Into a Material Definitive Agreement.
|
Underwriting Agreement
On December 4, 2017, Genesis Energy, L.P. (
Genesis
), Genesis Energy Finance Corporation (together with Genesis,
the
Issuers
) and certain subsidiary guarantors entered into an Underwriting Agreement (the
Underwriting Agreement
) with Citigroup Global Markets Inc., as representative of a group of
underwriters named in the Underwriting Agreement, in connection with the Issuers public offering of senior notes (the
Offering
).
The Underwriting Agreement provides for, among other things, the issuance and sale by the Issuers of $450 million in aggregate principal amount of 6.250%
senior unsecured notes due 2026 (the
Notes
), guaranteed by certain subsidiary guarantors of Genesis (together with the Notes, the
Securities
).
The Issuers expect to receive net proceeds from the Offering, after deducting underwriting discounts, commissions, and estimated expenses, of approximately
$441.8 million. Genesis intends to use the net proceeds from the Offering to (i) fund the purchase price and accrued and unpaid interest for all of its 5.750% senior unsecured notes due 2021 (the
2021 Notes
)
validly tendered and accepted for payment in its concurrent cash tender offer (the
Tender Offer
), (ii) fund the redemption price and any accrued and unpaid interest for any 2021 Notes that remain outstanding after
the completion or termination of the Tender Offer and (iii) for general partnership purposes, including repaying a portion of the borrowings outstanding under our revolving credit facility.
The Underwriting Agreement provides that the obligations of the underwriters to purchase the Notes are subject to receipt of legal opinions by counsel and to
other customary conditions. The Issuers have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended (as amended, the
Securities Act
), or to
contribute to payments the underwriters may be required to make because of any of those liabilities.
The Securities have been registered under the
Securities Act, pursuant to the Registration Statement on Form
S-3
(Registration
No. 333-203259),
as supplemented by the Prospectus Supplement dated
December 4, 2017, relating to the Offering, filed with the SEC pursuant to Rule 424(b) of the Securities Act.
The Underwriting Agreement contains
representations, warranties and other provisions that were made only for purposes of the Underwriting Agreement and as of specific dates and were solely for the benefit of the parties thereto. Accordingly, investors and securityholders should not
rely on such representations and warranties as characterizations of the actual state of facts or circumstances.
This summary of the Underwriting
Agreement is qualified in its entirety by reference to the full text of the Underwriting Agreement, a copy of which is filed as Exhibit 1.1 to this Current Report on Form
8-K
and is incorporated into this Item
1.01 by reference.
From time to time, certain of the underwriters and their affiliates have provided, or may in the future provide, various investment
banking, commercial banking, financial advisory, brokerage and other services to Genesis and its affiliates for which services they have received, and may in the future receive, customary fees and expense reimbursement. The underwriters and their
affiliates may, from time to time, engage in transactions with and perform services for Genesis in the ordinary course of their business for which they may receive customary fees and reimbursement of expenses. In addition, affiliates of each of the
underwriters are lenders under our revolving credit facility, and as such may be entitled to be repaid with the net proceeds of the Offering that are used to repay a portion of the borrowings outstanding under our revolving credit facility and may
receive their pro rata portion of such repayment. Citigroup Global Markets Inc. is acting as dealer manager for the Tender Offer, for which it will receive indemnification against certain liabilities and reimbursement of expenses. Additionally,
certain of the underwriters or their affiliates are holders of our 2021 Notes and, accordingly, may receive a portion of the proceeds of the Offering in the Tender Offer or any redemption of the 2021 Notes.