ENLINK MIDSTREAM, LLC (NYSE:ENLC) Files An 8-K Entry into a Material Definitive Agreement

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ENLINK MIDSTREAM, LLC (NYSE:ENLC) Files An 8-K Entry into a Material Definitive Agreement

ENLINK MIDSTREAM, LLC (NYSE:ENLC) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.

ENLC Revolving Credit Agreement

On December11, 2018, EnLink Midstream, LLC (“ENLC”) entered into a Revolving Credit Agreement (the “Revolving Credit Agreement”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Bank of Montreal and Royal Bank of Canada, as Co-Syndication Agents, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Documentation Agents, and the lenders party thereto.

The Revolving Credit Agreement will permit ENLC to borrow up to $1.75 billion on a revolving credit basis and includes a $500.0 million letter of credit subfacility. ENLC’s ability to borrow funds and obtain letters of credit under the Revolving Credit Agreement is conditioned upon, among other things, (i)the closing of the previously announced simplification transaction with EnLink Midstream Partners, LP (“ENLK”) (the “Simplification Transaction”), (ii)the prior or concurrent termination of ENLC’s and ENLK’s existing revolving credit facilities and (iii)ENLK guaranteeing ENLC’s obligations under the Revolving Credit Agreement upon the closing of the Simplification Transaction. The obligations under the Revolving Credit Agreement are unsecured.

The Revolving Credit Agreement includes procedures for additional financial institutions to become lenders, or for any existing lender to increase its revolving commitment thereunder, subject to an aggregate maximum of $2.25 billion for all commitments under the Revolving Credit Agreement.

The Revolving Credit Agreement will mature on the fifth anniversary of the initial funding date, unless ENLC requests, and the requisite lenders agree, to extend it to its terms. The Revolving Credit Agreement contains certain financial, operational, and legal covenants. The financial covenants will be tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. The financial covenants include (i)maintaining a ratio of consolidated EBITDA (as defined in the Revolving Credit Agreement, which term includes projected EBITDA from certain capital expansion projects) to consolidated interest charges of no less than 2.50 to 1.0 at all times prior to the occurrence of an investment grade event (as defined in the Revolving Credit Agreement) and (ii)maintaining a ratio of consolidated indebtedness to consolidated EBITDA of no more than 5.00 to 1.00. If ENLC consummates one or more acquisitions in which the aggregate purchase price is $50.0 million or more, ENLC can elect to increase the maximum allowed ratio of consolidated indebtedness to consolidated EBITDA to 5.5 to 1.0 for the quarter in which the acquisition occurs and the three subsequent quarters.

Borrowings under the Revolving Credit Agreement will bear interest at ENLC’s option at the Eurodollar Rate (the LIBOR Rate) plus an applicable margin (ranging from 1.125% to 2.00%) or the Base Rate (the highest of the Federal Funds Rate plus 0.50%, the 30-day Eurodollar Rate plus 1.0% or the administrative agent’s prime rate) plus an applicable margin (ranging from 0.125% to 1.00%). The applicable margins vary depending on ENLK’s debt rating (or, after ENLC has a debt rating, ENLC’s debt rating). Upon breach by ENLC of certain covenants governing the Revolving Credit Agreement, amounts outstanding under the Revolving Credit Agreement, if any, may become due and payable immediately.

The foregoing description of the Revolving Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the Revolving Credit Agreement, a copy of which is filed with this Current Report on Form8-K (this “Current Report”) as Exhibit10.1 and is incorporated herein by reference.

ENLK Term Loan Agreement

On December11, 2018, ENLK entered into a Term Loan Agreement (the “Term Loan Agreement”) with Bank of America, N.A., as Administrative Agent, Bank of Montreal and Royal Bank of Canada, as Co-Syndication Agents, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Documentation Agents, and the lenders party thereto.

Also on December11, 2018, ENLK borrowed $850 million under the Term Loan Agreement and used the net proceeds to repay a portion of the obligations outstanding under ENLK’s existing revolving credit facility. Upon the closing of the Simplification Transaction, ENLC will either guarantee ENLK’s obligations under the Term Loan Agreement or assume ENLK’s obligations thereunder, with ENLK becoming a guarantor of the term loan thereunder. The obligations under the Term Loan Agreement are unsecured.

The Term Loan Agreement will mature on December10, 2021. The Term Loan Agreement contains certain financial, operational, and legal covenants. The financial covenants will be tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. The financial covenants include (i)maintaining a ratio of consolidated EBITDA (as defined in the Term Loan Agreement, which term includes projected EBITDA from certain capital expansion projects) to consolidated interest charges of no less than 2.50 to 1.0 at all times prior to the occurrence of an investment grade event (as defined in the Term Loan Agreement) and (ii)maintaining a ratio of consolidated indebtedness to consolidated EBITDA of no more than 5.00 to 1.00. If ENLK consummates one or more acquisitions in which the aggregate purchase price is $50.0 million or more, ENLK can elect to increase the maximum allowed ratio of consolidated indebtedness to consolidated EBITDA to 5.5 to 1.0 for the quarter in which the acquisition occurs and the three subsequent quarters.

Borrowings under the Term Loan Agreement bear interest at ENLK’s option at the Eurodollar Rate (the LIBOR Rate) plus an applicable margin (ranging 1.00% to 1.75%) or the Base Rate (the highest of the Federal Funds Rate plus 0.50%, the 30-day Eurodollar Rate plus 1.0% or the administrative agent’s prime rate) plus an applicable margin (ranging from 0.00% to 0.75%). The applicable margins vary depending on ENLK’s debt rating (or, if ENLC has assumed or guaranteed the term loan and has a debt rating, ENLC’s debt rating). Upon breach by ENLK of certain covenants included in the Term Loan Agreement, amounts outstanding under the Term Loan Agreement, if any, may become due and payable immediately.

The foregoing description of the Term Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the Term Loan Agreement, a copy of which is filed with this Current Report as Exhibit10.2 and is incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information provided in Item 1.01 of this Current Report is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d)Exhibits.

EXHIBIT NUMBER

DESCRIPTION

10.1

Revolving Credit Agreement, dated as of December11, 2018, by and among EnLink Midstream, LLC, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Bank of Montreal and Royal Bank of Canada, as Co-Syndication Agents, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Documentation Agents, and the lenders party thereto.

10.2

Term Loan Agreement, dated as of December11, 2018, by and among EnLink Midstream Partners, LP, Bank of America, N.A., as Administrative Agent, Bank of Montreal and Royal Bank of Canada, as Co-Syndication Agents, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Documentation Agents, and the lenders party thereto.

EnLink Midstream, LLC Exhibit
EX-10.1 2 a18-41400_1ex10d1.htm EX-10.1 Exhibit 10.1   EXECUTION VERSION   Deal CUSIP Number: 29290KAC7 Revolving Credit Agreement CUSIP Number: 29290KAD5     REVOLVING CREDIT AGREEMENT   DATED AS OF DECEMBER 11,…
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About ENLINK MIDSTREAM, LLC (NYSE:ENLC)

EnLink Midstream, LLC is a midstream energy services company. The Company’s assets include its equity interests in EnLink Midstream Partners, LP (the Partnership) and EnLink TOM Holdings, LP (TOM Holdings). The Partnership is engaged in the gathering, transmission, processing and marketing of natural gas and natural gas liquids (NGLs), condensate and crude oil, as well as providing crude oil, condensate and brine services to producers. TOM Holdings and its subsidiaries are controlled by the Partnership and have similar operations to the Partnership. The Partnership has five reportable segments: Texas, Oklahoma, Louisiana, Crude and Condensate, and Corporate. The Partnership’s assets consist of gathering systems, transmission pipelines, processing facilities, fractionation facilities, stabilization facilities, storage facilities and ancillary assets.