On February 2, 2017, the Partnership issued and sold in a private placement 2,083,333
Series A Preferred Units at a price of $24.00 per unit. After deducting fees and expenses, the net proceeds from the sale were $48.6 million. The Partnership used the net proceeds from the sale to fund the cash portion of the purchase price of
the
Tordis Knutsen
and to repay debt and for general partnership purposes.
On June 30, 2017, the Partnership (i) issued
and sold in a second private placement 1,666,667 additional Series A Preferred Units at a price of $24.00 per unit and (ii) amended and restated its Partnership Agreement to make certain amendments to the terms of the Series A Preferred Units,
including the 2,083,333 Series A Preferred Units issued on February 2, 2017. After deducting estimated fees and expenses, the net proceeds of the sale were $38.9 million. The Partnership used $30.0 million of the net proceeds to repay
the revolving credit facility, which was drawn in connection with acquisition of the
Vigdis Knutsen.
17) Unit Activity
The following table shows the movement in the number of common units, general partner units and Series A Preferred Units from December 31,
2016 until June 30, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
(in units)
|
|
Common Units
|
|
|
General Partner Units
|
|
|
Convertible Preferred Units
|
|
December 31, 2016
|
|
|
27,194,094
|
|
|
|
558,674
|
|
|
|
|
|
January 6, 2017: Public offering
|
|
|
2,500,000
|
|
|
|
|
|
|
|
|
|
February 2, 2017: Sale of Series A Preferred Units
|
|
|
|
|
|
|
|
|
|
|
2,083,333
|
|
June 30, 2017: Sale of Series A Preferred Units
|
|
|
|
|
|
|
|
|
|
|
1,666,667
|
|
November 9, 2017: Public offering
|
|
|
3,000,000
|
|
|
|
56,443
|
|
|
|
|
|
December 31, 2017
|
|
|
32,694,094
|
|
|
|
615,117
|
|
|
|
3,750,000
|
|
June 30, 2018
|
|
|
32,694,094
|
|
|
|
615,117
|
|
|
|
3,750,000
|
|
On August 12, 2015, the Board authorized a program for the Partnership to repurchase up to 666,667 of its
common units. The board of directors of the General Partner concurrently authorized the General Partner to purchase up to 333,333 common units of the Partnership. On August 10, 2016, the Board and the board of directors of the General Partner
authorized an extension of the common unit purchase program to August 31, 2017, and on August 9, 2017, the Board and the board of directors of the General Partner authorized a further extension of the program to August 31, 2018. No
common units were purchased by the Partnership or the General Partner in 2017 or to date in 2018.
All purchases are made pursuant to a
single program and are allocated approximately
two-thirds
to the Partnership and
one-third
to the General Partner. There is no obligation to purchase any specific number
of common units and the program may be modified, suspended, extended or terminated at any time. Common units repurchased by the Partnership under the program have been cancelled.
18) Subsequent Events
The Partnership
has evaluated subsequent events from the balance sheet date through September 6, 2018, the date at which the unaudited condensed consolidated interim financial statements were available to be issued, and determined that there are no other items
to disclose, except as follows:
On July 13, 2018, a subsidiary of Royal Dutch Shell (Shell) exercised its option to
extend the time charter of the
Windsor Knutsen
by one additional year until October 2019.
On August 3, 2018, the Partnership
entered into amended time charter with Eni Trading & Shipping S.p.A. (Eni), extending the duration of the
Hilda Knutsen
time charter for four years and three
one-year
extension
options.
On August 14, 2018, the Partnership paid a quarterly cash distribution of $0.52 per common unit with respect to the quarter
ended June 30, 2018 to all common unitholders of record on August 1, 2018. On August 14, 2018, the Partnership also paid a cash distribution to holders of Series A Preferred Units with respect to the quarter ended June 30, 2018
in an aggregate amount equal to $1.8 million.
On September 4, 2018 the Partnerships subsidiaries which own the
Windsor
Knutsen
, the
Bodil Knutsen
, the
Fortaleza Knutsen
, the
Recife Knutsen
, the
Carmen Knutsen
and the
Ingrid Knutsen
(the Vessels), entered into new senior secured credit facilities in order to
refinance their existing long term bank debt. The senior secured credit facilities consist of a term loan of $320 million and a $55 million revolving credit facility. The term loan is repayable in 20 consecutive quarterly installments,
with a balloon payment of $ 177 million due at maturity in September 2023. The term loan bears interest at a rate per annum equal to LIBOR plus a margin of 2.125%. The revolving credit facility will mature in September 2023, and bear interest
at LIBOR plus a margin of 2.125%. There is a commitment fee of 0.85% payable on the undrawn portion of the revolving credit facility. The loans are guaranteed by the Partnership and secured by mortgages on the Vessels. The senior secured credit
facilities will refinance the previously existing term loans of $320.0 million and $35 million revolver credit capacity secured by the Vessels which were due to mature between December 2018 and June 2019. Closing of the senior
secured credit facilities is anticipated to occur in mid-September 2018.
27