Item 1.01
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Entry into a Material Definitive Agreement.
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On June 16, 2018, American Midstream,
LLC (
AM LLC
) and Blackwater Investments, Inc. (
Blackwater Investments
and, together with AM LLC, the
Sellers
), respectively, direct and indirect wholly owned subsidiaries of American Midstream
Partners, LP (
AMID
), entered into an Equity Purchase Agreement (the
Purchase Agreement
) with IIF Blackwater Holdings, LLC (the
Buyer
), an indirect subsidiary of institutional investors advised
by J.P. Morgan Asset Management. Upon the terms and subject to the conditions set forth in the Purchase Agreement, the Sellers have agreed to sell to the Buyer (i) 100% of the issued and outstanding stock of Blackwater Midstream Corp., which
indirectly owns the Harvey and Westwego marine liquids terminals located in the Port of New Orleans and the Brunswick marine liquids terminal located in the Port of Brunswick in Georgia (collectively, the
Marine Products
Terminals
) and (ii) 100% of the membership interests in American Midstream Terminaling, LLC, which holds certain agreements related to the Marine Products Terminals, for an aggregate purchase price of $210 million, plus balance sheet
cash at closing, less the repayment of all indebtedness, and subject to working capital adjustments (the
Transaction
).
The closing of the Transaction is subject to satisfaction or waiver of certain conditions, including: (i) subject to specified
materiality standards, the accuracy of the representations and warranties of each party; (ii) compliance by each party in all material respects with its covenants; (iii) expiration or termination of any applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the
HSR Act
); (iv) there being no law or injunction prohibiting the consummation of the Transaction; and (v) the parties receipt of customary
closing deliverables.
The Sellers and the Buyer have made customary representations and warranties in the Purchase Agreement. The
Purchase Agreement also contains customary covenants and agreements, including covenants and agreements relating to: (i) the conduct of businesses during the interim period between the execution of the Purchase Agreement and consummation of the
Transaction; and (ii) the efforts of the parties to cause the Transaction to be completed, including actions which may be necessary to cause the expiration or termination of the waiting period under the HSR Act. Other than fundamental and tax
representations, the representations and warranties contained in the Purchase Agreement will survive the consummation of the Transaction for a period of 12 months from the Closing Date (as defined in the Purchase Agreement). Subject to certain
limitations on liability contained in the Purchase Agreement, each Seller has agreed to indemnify the Buyer for breaches of representations and warranties, covenants and certain liabilities, including certain
pre-closing
tax matters and certain liabilities of the Sellers that are unrelated to the business of the Marine Products Terminals as conducted as of the consummation of the Transaction.
The Purchase Agreement contains certain termination rights for both the Sellers and the Buyer including, but not limited to, the right to
terminate the Purchase Agreement in the event that (i) the Transaction has not been consummated on or before September 14, 2018 or (ii) under certain conditions, if there has been a breach of certain representations and warranties or
a failure to perform any covenant by the other party.
The foregoing description of the Purchase Agreement does not purport to be complete
and is qualified in its entirety by reference to the Purchase Agreement, which will be filed with AMIDs Quarterly Report on
Form 10-Q for
the quarter ending June 30, 2018.
The foregoing summary of the Purchase Agreement has been included, and the Purchase Agreement will be filed, to provide investors and security
holders with information regarding the terms of the Purchase Agreement. It is not intended to provide any other factual information about AMID, the Sellers, the Buyer or their respective subsidiaries and affiliates. The Purchase Agreement
contains representations and warranties by each of the applicable parties to the Purchase Agreement, which were made only for purposes of the Purchase Agreement and as of specified dates and which may be limited or qualified by confidential
disclosure schedules or other documents not required to be filed with the Purchase Agreement. The representations, warranties and covenants in the Purchase Agreement were made solely for the benefit of the parties to the Purchase
Agreement. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of AMID, the Sellers, the Buyer or any of their respective
subsidiaries or affiliates.
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