CrossAmerica Partners LP (NYSE:CAPL) Files An 8-K Completion of Acquisition or Disposition of Assets
Item 2.01 Completion of Acquisition or Disposition of Assets
As previously disclosed in a Current Report on Form 8-K filed by CrossAmerica Partners LP (“CrossAmerica” or “the Partnership”) on December 17, 2018, the Partnership entered into an Asset Exchange Agreement (the “Asset Exchange Agreement”) with Circle K Stores Inc., a Texas corporation (“Circle K”), to which the Partnership and Circle K agreed to exchange (i) certain assets of the Partnership related to 56 convenience and fuel retail stores currently leased and operated by Circle K to a master lease that the Partnership previously purchased jointly with or from CST Brands, Inc. (the “master lease properties”) and 17 convenience and fuel retail stores currently owned and operated by the Partnership located in the U.S. Upper Midwest (the “Upper Midwest properties”), for (ii) certain assets of Circle K related to 192 (162 fee and 30 leased) company-operated convenience and fuel retail stores. The transactions contemplated by the Asset Exchange Agreement are to be closed in a series of “tranche” closings, which the Partnership now expects will be completed during the first half of 2020.
Also as previously disclosed in Current Reports on Form 8-K filed by CrossAmerica on May 22, 2019, September 5, 2019 and February 26, 2020, the closings of the first three tranches of asset exchanges under the Asset Exchange Agreement occurred on May 21, 2019, September 5, 2019 and February 25, 2020.
On April 7, 2020, the closing of the fourth tranche of asset exchanges under the Asset Exchange Agreement occurred (the “Fourth Asset Exchange”). In this Fourth Asset Exchange, Circle K transferred to the Partnership 13 (11 fee; 2 leased) U.S. company-operated convenience and fuel retail stores having an aggregate value of approximately $13.1 million, and the Partnership transferred to Circle K the real property for seven of the master lease properties having an aggregate value of approximately $12.8 million.
In connection with the closing of the Fourth Asset Exchange, the stores transferred by Circle K were dealerized as contemplated by the Asset Exchange Agreement and Circle K’s rights under the dealer agreements and agent agreements that were entered into in connection therewith were assigned to the Partnership.
Relationship between the Parties. Circle K and the Partnership are no longer related parties since November 19, 2019, when entities affiliated with Joseph V. Topper, Jr. purchased from subsidiaries of Circle K: 1) 50% of the membership interest in the sole member of the General Partner; 2) 50% of the IDRs issued by the Partnership; and 3) an aggregate of 7,486,131 common units of the Partnership. Joseph V. Topper, Jr. is the founder and, since November 19, 2019, chairman of the Board. See the Current Report on Form 8-K filed by CrossAmerica on November 21, 2019. Circle K and the Partnership have entered into real property leases and fuel supply agreements, among others. For more information about the relationship between the Partnership and Circle K, see the description thereof included in Part III, Item 13, “Certain Relationship and Related Party Transactions, and Director Independence” in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2018.
About CrossAmerica Partners LP (NYSE:CAPL)
CrossAmerica Partners LP is a limited partnership engaged in the wholesale distribution of motor fuel, and the ownership and leasing of real estate used in the retail distribution of motor fuel. The Company operates in two segments: wholesale and retail. The Company’s sites are located in Pennsylvania, New Jersey, Ohio, New York, Massachusetts, Kentucky, New Hampshire, Maine, Florida, Maryland, Delaware, Tennessee, Virginia, Illinois, Indiana and West Virginia. The Company also distributes motor fuel in Georgia and North Carolina. It distributes motor fuels at approximately 1,100 sites located in over 20 states. In addition, the Company, through One Stop convenience stores network, owns over 40 stores in Charleston, West Virginia. The Company purchases branded and unbranded motor fuel from integrated oil companies, refiners and unbranded fuel suppliers. It owns or leases and operates convenience stores and retains all profits from motor fuel and convenience store operations.