Business Context and Reporting Period
This Form 8-K Current Report was filed by PBF Energy Inc. and PBF Holding Company LLC on December 2, 2014. The filing reports the entry into a Material Definitive Agreement involving the contribution of assets to PBF Logistics LP, a consolidated subsidiary.
Key Financial Metrics and Transaction Details
The filing details a specific transaction rather than providing periodic financial statements (e.g., revenue, profit, or cash flow for a fiscal period). Key financial figures related to the transaction include:
- Total Consideration: $150 million payable to PBF Energy Company LLC.
- Cash Component: $135 million.
- Equity Component: $15 million in Partnership common units (620,935 units).
- Assets Contributed: All issued and outstanding interests of Toledo Terminaling Company LLC (TTC), comprising a tank farm and propane storage/loading facility at the Toledo refinery.
- Funding Sources: $30 million from the sale of marketable securities and $105 million from borrowings under the Partnership's revolving credit facility.
- Debt Restructuring: An additional $30 million will be borrowed to repay an outstanding term loan, releasing $30 million in collateralized marketable securities.
Material Changes and Agreements
The primary material change is the restructuring of the Toledo terminaling assets into the PBF Logistics LP partnership. Concurrent with the contribution, the following agreements were executed or amended:
- Storage and Terminaling Services Agreement: A ten-year initial term agreement with a minimum throughput commitment of 4,400 barrels per day at the propane storage and loading facility.
- Assignment of Rights: Assignment of the existing Toledo Truck Unloading and Terminaling Agreement to TTC.
- Amendments: Updates to the Omnibus Agreement and Operation and Management Services and Secondment Agreement.
Outlook, Risks, and Closing Conditions
The closing of the Contribution Agreement is expected to occur on or about December 12, 2014, subject to customary representations, warranties, indemnification obligations, and closing conditions. The filing includes standard forward-looking statements regarding future plans and performance, noting that actual results may differ due to risks disclosed in other SEC filings. The filing explicitly states that representations and warranties in the agreement are for the benefit of the parties and may not reflect the actual state of facts for investors.
Investor Verification Checklist
- Verify the final closing date of the transaction (expected December 12, 2014).
- Review the full text of the Contribution Agreement (Exhibit 10.1) for specific covenants and risk allocation.
- Confirm the impact of the $135 million cash inflow and $135 million in new borrowings on the consolidated balance sheet.
- Assess the long-term revenue implications of the 4,400 barrels per day minimum throughput commitment.
- Monitor the release of the $30 million in marketable securities previously collateralized by the term loan.