NOBLE MIDSTREAM PARTNERS LP (NYSE:NBLX) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry Into a Material Definitive Agreement.
Contribution Agreement
On June 20, 2017, Noble Midstream Partners LP (the Partnership)
entered into a Contribution Agreement (the Contribution
Agreement) by and among the Partnership, Noble Midstream GP LLC,
the general partner of the Partnership (the General Partner),
Noble Midstream Services, LLC (Midstream Services), NBL
Midstream, LLC (NBL Midstream), a subsidiary of Noble Energy,
Inc. (Noble) and Blanco River DevCo GP LLC (Blanco River DevCo
GP). to the terms of the Contribution Agreement, the Partnership
agreed to acquire from NBL Midstream (i) the remaining 20%
limited partner interest in Colorado River DevCo LP and (ii) a
15% limited partner interest in Blanco River DevCo LP
(collectively, (i) and (ii) are referred to herein as the
Contributed Assets). In consideration for the acquisition of the
Contributed Assets, the Partnership agreed to pay NBL Midstream
total aggregate consideration of $270 million, consisting of (i)
consideration of $245 million in cash and (ii) 562,430 common
units representing limited partner interests in the Partnership
(Common Units) issued to NBL Midstream (the Transaction). The
Transaction closed on June 26, 2017. The Partnership funded the
cash component of the consideration with a combination of
borrowings under the Partnerships existing credit facility and
cash proceeds from the private placement described below. The
Partnership now owns 50% of the interests in Colorado River DevCo
LP and a 40% general partner interest in Blanco River DevCo LP.
entered into a Contribution Agreement (the Contribution
Agreement) by and among the Partnership, Noble Midstream GP LLC,
the general partner of the Partnership (the General Partner),
Noble Midstream Services, LLC (Midstream Services), NBL
Midstream, LLC (NBL Midstream), a subsidiary of Noble Energy,
Inc. (Noble) and Blanco River DevCo GP LLC (Blanco River DevCo
GP). to the terms of the Contribution Agreement, the Partnership
agreed to acquire from NBL Midstream (i) the remaining 20%
limited partner interest in Colorado River DevCo LP and (ii) a
15% limited partner interest in Blanco River DevCo LP
(collectively, (i) and (ii) are referred to herein as the
Contributed Assets). In consideration for the acquisition of the
Contributed Assets, the Partnership agreed to pay NBL Midstream
total aggregate consideration of $270 million, consisting of (i)
consideration of $245 million in cash and (ii) 562,430 common
units representing limited partner interests in the Partnership
(Common Units) issued to NBL Midstream (the Transaction). The
Transaction closed on June 26, 2017. The Partnership funded the
cash component of the consideration with a combination of
borrowings under the Partnerships existing credit facility and
cash proceeds from the private placement described below. The
Partnership now owns 50% of the interests in Colorado River DevCo
LP and a 40% general partner interest in Blanco River DevCo LP.
The Contribution Agreement includes customary representations and
warranties regarding the Partnership, the General Partner,
Midstream Services, Blanco River DevCo GP and the Transaction, as
well as customary covenants and indemnity provisions. The parties
have agreed to indemnify each other for any breaches of their
respective representations, warranties and covenants set forth in
the Contribution Agreement.
warranties regarding the Partnership, the General Partner,
Midstream Services, Blanco River DevCo GP and the Transaction, as
well as customary covenants and indemnity provisions. The parties
have agreed to indemnify each other for any breaches of their
respective representations, warranties and covenants set forth in
the Contribution Agreement.
The terms of the Transaction were approved on behalf of the
Partnership by the Board of Directors of the General Partner,
after the Conflicts Committee of the Board of Directors of the
General Partner (the Conflicts Committee) unanimously recommended
that the Board of Directors of the General Partner approve the
Transaction. The Conflicts Committee, composed of independent
members of the Board of Directors of the General Partner,
retained legal and financial advisors to assist it in evaluating
and negotiating the Transaction. In approving the Transaction,
the Conflicts Committee based its decisions in part on an opinion
from its independent financial advisor that the total
consideration to be paid by the Partnership in connection with
the Transaction is fair, from a financial point of view, to the
Partnership and to holders of the Partnerships Common Units other
than Noble Energy, Inc. and its affiliates.
Partnership by the Board of Directors of the General Partner,
after the Conflicts Committee of the Board of Directors of the
General Partner (the Conflicts Committee) unanimously recommended
that the Board of Directors of the General Partner approve the
Transaction. The Conflicts Committee, composed of independent
members of the Board of Directors of the General Partner,
retained legal and financial advisors to assist it in evaluating
and negotiating the Transaction. In approving the Transaction,
the Conflicts Committee based its decisions in part on an opinion
from its independent financial advisor that the total
consideration to be paid by the Partnership in connection with
the Transaction is fair, from a financial point of view, to the
Partnership and to holders of the Partnerships Common Units other
than Noble Energy, Inc. and its affiliates.
Unit Purchase Agreement
On June 20, 2017, the Partnership entered into a Common Unit
Purchase Agreement (the Unit Purchase Agreement) with certain
institutional investors (the Investors) to sell 3,525,000 Common
Units in a private placement for gross proceeds of approximately
$143 million (the Private Placement). The closing of the Private
Placement occurred on June 26, 2017. The Common Units were issued
in reliance on Section 4(a)(2) of the Securities Act of 1933, as
amended (the Securities Act), for an exemption from the
registration requirements of Section 5 of the Securities Act. The
net proceeds of the Private Placement were used to fund a portion
of the cash consideration paid to NBL Midstream in connection
with the Transaction described above.
Purchase Agreement (the Unit Purchase Agreement) with certain
institutional investors (the Investors) to sell 3,525,000 Common
Units in a private placement for gross proceeds of approximately
$143 million (the Private Placement). The closing of the Private
Placement occurred on June 26, 2017. The Common Units were issued
in reliance on Section 4(a)(2) of the Securities Act of 1933, as
amended (the Securities Act), for an exemption from the
registration requirements of Section 5 of the Securities Act. The
net proceeds of the Private Placement were used to fund a portion
of the cash consideration paid to NBL Midstream in connection
with the Transaction described above.
Barclays Capital Inc., BofA Merrill Lynch and Mizuho Securities
USA LLC acted as lead placement agents in connection with the
Private Placement. Citigroup Global Markets Inc., DNB Markets,
Inc., J.P. Morgan Securities LLC and MUFG Securities Americas
Inc. also acted as placement agents in connection with the
Private Placement.
USA LLC acted as lead placement agents in connection with the
Private Placement. Citigroup Global Markets Inc., DNB Markets,
Inc., J.P. Morgan Securities LLC and MUFG Securities Americas
Inc. also acted as placement agents in connection with the
Private Placement.
The Unit Purchase Agreement contains customary representations,
warranties and covenants of the Partnership and the Investors.
The Partnership, on the one hand, and each of the Investors
(severally and not jointly), on the other hand, have agreed to
indemnify each other and their respective affiliates, officers,
directors and other representatives against certain losses
resulting from any breach of their representations, warranties or
covenants contained in the Unit Purchase Agreement, subject to
certain limitations and survival periods.
warranties and covenants of the Partnership and the Investors.
The Partnership, on the one hand, and each of the Investors
(severally and not jointly), on the other hand, have agreed to
indemnify each other and their respective affiliates, officers,
directors and other representatives against certain losses
resulting from any breach of their representations, warranties or
covenants contained in the Unit Purchase Agreement, subject to
certain limitations and survival periods.
Registration Rights Agreement
In connection with the closing of the Private Placement, the
Partnership and the Investors entered into a Registration Rights
Agreement on June 26, 2017. to the Registration Rights Agreement,
the Partnership is required to file a registration statement (the
Registration Statement) to register for public resale the
3,525,000 Common Units sold to the Investors under the Unit
Purchase Agreement, as well as any Common Units issued in lieu of
cash as liquidated damages as described below, no later than July
26, 2017, and use its commercially reasonable efforts to cause
the Registration Statement to become effective on the filing date
or as soon as practicable thereafter. If the Registration
Statement is not declared effective by September 24, 2017, the
Partnership will be liable to each Investor for liquidated
damages as calculated in accordance with the Registration Rights
Agreement.
Partnership and the Investors entered into a Registration Rights
Agreement on June 26, 2017. to the Registration Rights Agreement,
the Partnership is required to file a registration statement (the
Registration Statement) to register for public resale the
3,525,000 Common Units sold to the Investors under the Unit
Purchase Agreement, as well as any Common Units issued in lieu of
cash as liquidated damages as described below, no later than July
26, 2017, and use its commercially reasonable efforts to cause
the Registration Statement to become effective on the filing date
or as soon as practicable thereafter. If the Registration
Statement is not declared effective by September 24, 2017, the
Partnership will be liable to each Investor for liquidated
damages as calculated in accordance with the Registration Rights
Agreement.
In addition, if the Partnership sells any Common Units in a
registered underwritten offering, each Investor that holds $30
million or more of Common Units purchased in the Private
Placement will have the right, subject to specified limitations,
to include its Common Units in that offering. Investors that
participate in the underwritten offering are subject to a pro
rata cutback of registrable Common Units to be included in the
offering if the managing underwriters determine that a limitation
is needed on the total number of shares offered.
registered underwritten offering, each Investor that holds $30
million or more of Common Units purchased in the Private
Placement will have the right, subject to specified limitations,
to include its Common Units in that offering. Investors that
participate in the underwritten offering are subject to a pro
rata cutback of registrable Common Units to be included in the
offering if the managing underwriters determine that a limitation
is needed on the total number of shares offered.
The Partnership has also agreed to indemnify each Investor for
certain violations of federal or state securities laws in
connection with any registration statement in which such Investor
sells its Common Units to these registration rights. Each
Investor has, in turn, agreed to indemnify the Partnership for
federal or state securities law violations that occur in reliance
upon written information it provides to the Partnership for
inclusion in the registration statement.
certain violations of federal or state securities laws in
connection with any registration statement in which such Investor
sells its Common Units to these registration rights. Each
Investor has, in turn, agreed to indemnify the Partnership for
federal or state securities law violations that occur in reliance
upon written information it provides to the Partnership for
inclusion in the registration statement.
The above descriptions of the Contribution Agreement, the Unit
Purchase Agreement and the Registration Rights Agreement are
summaries only and are qualified in their entirety by reference
to the full text of those agreements, which are filed as Exhibits
10.1, 10.2 and 4.1, respectively, to this Current Report on Form
8-K and incorporated herein by reference. The Contribution
Agreement, the Unit Purchase Agreement and the Registration
Rights Agreement are filed herewith to provide investors with
information regarding their respective terms. They are not
intended to provide any other factual information about the
parties. In particular, the assertions embodied in the
representations and warranties contained in each agreement were
made as of the date of such agreement. Moreover, certain
representations and warranties in each agreement may have been
used for the purpose of allocating risk between the parties
rather than establishing matters of fact. Accordingly, you should
not rely on the representations and warranties in any of the
Contribution Agreement, the Unit Purchase Agreement or the
Registration Rights Agreement as characterizations of the actual
statements of fact about the parties.
Purchase Agreement and the Registration Rights Agreement are
summaries only and are qualified in their entirety by reference
to the full text of those agreements, which are filed as Exhibits
10.1, 10.2 and 4.1, respectively, to this Current Report on Form
8-K and incorporated herein by reference. The Contribution
Agreement, the Unit Purchase Agreement and the Registration
Rights Agreement are filed herewith to provide investors with
information regarding their respective terms. They are not
intended to provide any other factual information about the
parties. In particular, the assertions embodied in the
representations and warranties contained in each agreement were
made as of the date of such agreement. Moreover, certain
representations and warranties in each agreement may have been
used for the purpose of allocating risk between the parties
rather than establishing matters of fact. Accordingly, you should
not rely on the representations and warranties in any of the
Contribution Agreement, the Unit Purchase Agreement or the
Registration Rights Agreement as characterizations of the actual
statements of fact about the parties.
Relationships
Each of the parties to the Contribution Agreement is a direct or
indirect subsidiary of Noble. As a result, certain individuals,
including officers of Noble and officers and directors of the
General Partner, serve as officers and/or directors of one or
more of such entities. As of the date of this Current Report on
Form 8-K, after giving effect to the transactions described
herein, NBL Midstream owns 2,090,014 Common Units and 15,902,584
subordinated units of the Partnership (Subordinated Units),
collectively representing a 50.1% limited partner interest in the
Partnership based on the number of Common Units and Subordinated
Units outstanding as the date hereof. NBL Midstream also owns a
noneconomic general partner interest in the Partnership and all
of the Partnerships incentive distribution rights through its
ownership of the General Partner.
indirect subsidiary of Noble. As a result, certain individuals,
including officers of Noble and officers and directors of the
General Partner, serve as officers and/or directors of one or
more of such entities. As of the date of this Current Report on
Form 8-K, after giving effect to the transactions described
herein, NBL Midstream owns 2,090,014 Common Units and 15,902,584
subordinated units of the Partnership (Subordinated Units),
collectively representing a 50.1% limited partner interest in the
Partnership based on the number of Common Units and Subordinated
Units outstanding as the date hereof. NBL Midstream also owns a
noneconomic general partner interest in the Partnership and all
of the Partnerships incentive distribution rights through its
ownership of the General Partner.
Noble or its subsidiaries are party to various gathering, service
and revenue agreements with the Partnership or its subsidiaries
for the provision of midstream services. In addition, Noble is
our largest customer and we derive substantially all of our
revenue from Noble.
and revenue agreements with the Partnership or its subsidiaries
for the provision of midstream services. In addition, Noble is
our largest customer and we derive substantially all of our
revenue from Noble.
Item 2.01 Completion of Acquisition or Disposition of Assets.
To the extent required, the information regarding the Transaction
set forth under Item 1.01 of this Current Report on Form 8-K is
incorporated herein by reference.
set forth under Item 1.01 of this Current Report on Form 8-K is
incorporated herein by reference.
Item 3.02 Sale of Unregistered Units.
The information regarding the Transaction and the Private
Placement set forth in Item 1.01 of this Current Report on Form
8-K is incorporated herein by reference. The foregoing
transactions were undertaken in reliance upon the exemption from
the registration requirements in Section 4(a)(2) of the
Securities Act. The Partnership believes that exemptions other
than the foregoing exemption may exist for these transactions.
Placement set forth in Item 1.01 of this Current Report on Form
8-K is incorporated herein by reference. The foregoing
transactions were undertaken in reliance upon the exemption from
the registration requirements in Section 4(a)(2) of the
Securities Act. The Partnership believes that exemptions other
than the foregoing exemption may exist for these transactions.
Item 7.01 Regulation FD Disclosure.
On June 21, 2017, the Partnership issued two press releases
relating to the Transaction and the Private Placement, which are
attached hereto as Exhibit 99.1 and Exhibit 99.2 and incorporated
herein by reference.
relating to the Transaction and the Private Placement, which are
attached hereto as Exhibit 99.1 and Exhibit 99.2 and incorporated
herein by reference.
The information included in Item 7.01 of this Current Report on
Form 8-K, including Exhibits 99.1 and 99.2, is being furnished to
Item 7.01 of Form 8-K and shall not be deemed filed for purposes
of Section 18 of the Securities Exchange Act of 1934, or
otherwise subject to liabilities of that section.
Form 8-K, including Exhibits 99.1 and 99.2, is being furnished to
Item 7.01 of Form 8-K and shall not be deemed filed for purposes
of Section 18 of the Securities Exchange Act of 1934, or
otherwise subject to liabilities of that section.
Item 9.01. Financial Statements and Exhibits.
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(d)
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Exhibits.
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2.1
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Contribution Agreement, dated June 20, 2017, by and
among the Partnership, Noble Midstream GP LLC, Noble Midstream Services, LLC, NBL Midstream, LLC and Blanco River DevCo GP LLC. |
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4.1
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Registration Rights Agreement, dated June 26, 2017, by
and among the Partnership and the Purchasers named therein. |
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10.1
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Common Unit Purchase Agreement, dated as of June 20,
2017, by and among the Partnership and the Purchasers named therein. |
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99.1
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Press Release dated June 21, 2017 relating to the
Private Placement. |
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99.2
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Press Release dated June 21, 2017 relating to the
Transaction. |
Noble Midstream Partners LP ExhibitEX-2.1 2 exhibit21-contributionagre.htm EXHIBIT 2.1 Exhibit Exhibit 2.1CONTRIBUTION AGREEMENTThis CONTRIBUTION AGREEMENT,…To view the full exhibit click here About NOBLE MIDSTREAM PARTNERS LP (NYSE:NBLX)
Noble Midstream Partners LP is formed to own, operate, develop and acquire a range of domestic midstream infrastructure assets. The Company focuses in the area of DJ Basin in Colorado and in the Delaware Basin within the Permian Basin in Texas. The Company’s segments include Gathering Systems; Fresh Water Delivery, and investments in white cliffs and other. The Company’s gathering systems segment includes crude oil, natural gas and produced water gathering, as well as crude oil treating. The Company provides crude oil, natural gas, and water-related midstream services for Noble Energy, Inc. through long-term, fixed-fee contracts. Through its ownership interests in the development companies, the Company operates and owns interests in various assets, which include crude oil and natural gas gathering systems; crude oil treating facilities; produced water collection, gathering, and cleaning systems, and fresh water storage and delivery. Its operations are located in the United States. NOBLE MIDSTREAM PARTNERS LP (NYSE:NBLX) Recent Trading Information
NOBLE MIDSTREAM PARTNERS LP (NYSE:NBLX) closed its last trading session down -0.64 at 46.21 with 81,384 shares trading hands.