Azure Midstream Partners, LP (NASDAQ:FISH) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive
Agreement.
On March 10, 2017, in accordance with the bid procedures order of
the United States Bankruptcy Court for the Southern District of
Texas, Houston Division (the Bankruptcy Court), Azure Midstream
Partners, LP (the Partnership) together with certain direct and
indirect subsidiaries (collectively, Sellers) and their counsel
and advisors, in consultation with representatives of the
Partnerships secured lenders, held an auction in connection with
the sale of substantially all of the Sellers assets. After
multiple rounds of bidding, BTA Gathering LLC, (Buyer), a wholly
owned subsidiary of Enterprise Products Operating LLC, (the
Guarantor), was declared to have won the auction by presenting
the highest or otherwise best offer for such assets.
Subsequently, Sellers and Buyer executed a purchase and sale
agreement (PSA) on March 15, 2017. The PSA was accepted by the
Bankruptcy Court and incorporated into the Courts sale order
issued on March 15, 2017. to the terms of the PSA, Sellers agreed
to sell substantially all of their assets to Buyer for $189.0
million in cash, subject to certain customary purchase price
adjustments.
The PSA was substantially similar to the previously executed
stalking horse purchase and sale agreement (the M5 Agreement)
among Sellers and M5 Midstream LLC (M5), which was filed as an
exhibit to the Partnerships Report on Form 8-K filed on February
15, 2017 (the M5 Form 8-K), with the following material
differences:
the purchase price was increased to $189.0 million in the PSA,
from $151.1 million in the M5 Agreement; of the higher purchase
price, approximately $5.5 million will be paid to M5 as a
break-up fee and expense reimbursement in connection with the
termination of the M5 Agreement;
the $3.7 million reduction in the purchase price under the M5
Agreement, in the event that the so-called BP Partial Assignment
was not obtained by closing, was deleted from the PSA; and
Section 2.6 regarding the BP Preferential Purchase Right was
revised to reduce the Preferential Right Amount from $23.0
million to $5.0 million.
Buyer deposited $16.0 million with an escrow agent, to be applied
to the Purchase Price at closing. In the event that the closing
does not occur, the deposit will be paid to Sellers in certain
cases and to Buyer in other cases. The PSA contains customary
representations, warranties, covenants and conditions. Sellers
and Buyer anticipate the closing of the transactions contemplated
under the PSA to occur within three business days after the
satisfaction or waiver of Buyers and Sellers conditions to
closing, which is expected to occur prior to May 1, 2017.
The PSA may be terminated, subject to certain exceptions: (i)
upon mutual written consent of the parties; (ii) in the event of
a final and non-appealable order by a governmental authority
prohibiting the consummation of the transactions contemplated
under the PSA; (iii) if the sale order is vacated, modified or
supplemented in a manner that is material and adverse to either
Sellers or Buyer; (iv) if the closing has not occurred on or
prior to May 1, 2017; (v) if Sellers bankruptcy cases are
converted to Chapter 7 cases, dismissed, or a trustee is
appointed under Chapter 11; (vi) in the event of certain material
breaches by a party of representations and warranties or
covenants that remain uncured; and (vii) if an alternative
transaction is consummated.
As part of the Courts sale order on March 15, 2017 the Court
declared the M5 Agreement, as modified to reflect a higher
purchase price of $188.0 million, to be the back-up bid as
specified in the bid procedures order.
The summary of the PSA and the M5 Agreement set forth above does
not purport to be complete and is qualified in its entirety by
reference to the PSA and the M5 Agreement, respectively, which
are filed as Exhibit 10.1 hereto and Exhibit 10.1 to the M5 Form
8-K, respectively, and incorporated herein by reference.
Cautionary Note Regarding Forward-Looking
Statements.
This Current Report on Form 8-K includes forward-looking
statements. All statements, other than statements of historical
facts, included in this Current Report on Form 8-K that address
activities, events or developments that the Partnership expects,
believes or anticipates will or may occur in the future are
forward-looking statements. Terminology such as will, would,
should, could, expect, anticipate, plan, project, intend,
estimate, believe, target, continue, potential, the negative of
such terms or other comparable terminology are intended to
identify forward-looking statements. These statements include,
but are not limited to, statements about financial restructuring
or strategic alternatives and the Partnerships expectations of
plans, goals, strategies (including measures to implement
strategies), objectives and anticipated results with respect
thereto. These statements are based on certain assumptions made
by the Partnership based on its experience and perception of
historical trends, current conditions, expected future
developments and other factors it believes are appropriate in the
circumstances, but such assumptions may prove to be inaccurate.
Such statements are also subject to a number of risks and
uncertainties, many of which are beyond the control of the
Partnership, which may cause the Partnerships actual results to
differ materially from those implied or expressed by the
forward-looking statements. These include risks and uncertainties
relating to, among other things: the ability to confirm and
consummate a plan of reorganization; the bankruptcy process,
including the effects thereof on Partnerships business and on the
interests of various
constituents, the length of time that the Partnership may be
required to operate in bankruptcy and the continued
availability of operating capital during the pendency of such
proceedings; third party motions in any bankruptcy case, which
may interfere with the ability to confirm and consummate a plan
of reorganization; the potential adverse effects of bankruptcy
proceedings on the Partnerships liquidity or results of
operations; increased costs to execute a sale of the
Partnerships assets; risks related to the Partnerships ability
to generate sufficient cash flow and to make payments on its
obligations and to execute a sale transaction; the Partnerships
ability to access funds on acceptable terms, if at all, because
of the terms and conditions governing the Partnerships
indebtedness or otherwise; the uncertainty of the impact that
any sale or financial restructuring implemented will have on
the market for the Partnerships publicly traded securities; tax
consequences of business transactions; and changes in commodity
prices. Please read the Partnerships filings with the SEC,
including Risk Factors in the Partnerships Annual Report on
Form 10-K, and if applicable, the Partnerships Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, which are
available on the Partnerships Investor Relations website at
http://phx.corporate-ir.net/phoenix.zhtml?c=253822p=irol-sec.
or on the SECs website at http://www.sec.gov, for a discussion
of risks and uncertainties that could cause actual results to
differ from those in such forward-looking statements. You are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this Current
Report on Form 8-K. All forward-looking statements in this
Current Report on Form 8-K are qualified in their entirety by
these cautionary statements. Except as required by law, the
Partnership undertakes no obligation and does not intend to
update or revise any forward-looking statements, whether as a
result of new information, future results or otherwise.
Item 9.01 Financial Statements and
Exhibits
(d) Exhibits
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ExhibitNo. |
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ExhibitDescription |
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10.1 |
Purchase and Sale Agreement dated as of March 10, 2017 by |
About Azure Midstream Partners, LP (NASDAQ:FISH)
Azure Midstream Partners, LP, formerly Marlin Midstream Partners, LP, develops, owns, operates and acquires midstream energy assets. Through its subsidiaries, Marlin Logistics, LLC (Marlin Logistics), Marlin Midstream, LLC (Marlin Midstream) and Azure ETG, LLC (Azure ETG), the Company is engaged in gathering, transporting, treating and processing natural gas, transloading crude oil and selling or delivering natural gas liquids (NGLs) to third parties. The Company operates through two segments: gathering and processing, and logistics. The Company’s gathering and processing segment provides natural gas gathering, compression, dehydration, treating, processing, and hydrocarbon dew-point control and transportation services to producers, marketers and third-party pipeline companies, and logistics business segment provides crude oil logistics services. Its transloaders are used to unload crude oil from tanker trucks and load crude oil into railcars. Azure Midstream Partners, LP (NASDAQ:FISH) Recent Trading Information
Azure Midstream Partners, LP (NASDAQ:FISH) closed its last trading session 00.00 at 16.53 with shares trading hands.