8-KMaterial AgreementsExhibits & Filings

Energy Transfer LP 8-K Report, Material Agreement (Oct 18, 2017)

Filed October 18, 2017For Securities:ETET-PI

Summary

Energy Transfer LP (ET) announced on October 18, 2017, the completion of a $1.0 billion public offering of 4.25% Senior Notes due 2023. The company received net proceeds of approximately $990 million, which are intended to be used for repaying a portion of its outstanding term loan facility and for general partnership purposes. This issuance represents a strategic move to manage its debt structure and improve liquidity. The Notes are senior unsecured obligations of the Partnership, ranking equally with existing unsubordinated debt. They are secured by a lien on substantially all of the Partnership's tangible and intangible assets that also secure other existing indebtedness, subject to certain exceptions. The maturity date for these notes is March 15, 2023, with semi-annual interest payments commencing March 15, 2018. The filing also details various covenants and customary events of default, providing transparency into the terms and risks associated with this new debt issuance.

Key Highlights

  • 1Completed a $1.0 billion public offering of 4.25% Senior Notes due 2023.
  • 2Net proceeds of approximately $990 million received from the offering.
  • 3Proceeds will be used to repay a portion of the outstanding term loan facility and for general partnership purposes.
  • 4Notes mature on March 15, 2023, with semi-annual interest payments beginning March 15, 2018.
  • 5Notes are senior unsecured obligations, ranking equally with other unsubordinated debt.
  • 6Secured on a first-priority basis by a lien on substantially all of the Partnership's assets, subject to exceptions and permitted liens.
  • 7The Indenture includes customary covenants and events of default, providing standard protections for bondholders.

Frequently Asked Questions

The primary purpose of this $1.0 billion debt issuance is to refinance existing debt, specifically to repay a portion of the outstanding indebtedness under the Partnership's term loan facility, and for general partnership purposes. This aims to manage the company's debt maturity profile and improve its financial flexibility.

The new Senior Notes carry a coupon rate of 4.25% and will mature on March 15, 2023. Interest payments are scheduled to be made semi-annually, starting on March 15, 2018.

The Notes are senior unsecured obligations of Energy Transfer LP, meaning they rank equally in right of payment with the Partnership's other existing and future unsubordinated debt. However, they are secured on a first-priority basis by a lien on substantially all of the Partnership's and certain of its subsidiaries' tangible and intangible assets that secure existing indebtedness, subject to certain exceptions and permitted liens.

The Indenture includes standard covenants such as limitations on liens, affiliate transactions, sale-leaseback transactions, and mergers or sales of substantially all assets. Key events of default include payment defaults, failure to comply with certain covenants after notice, cross-defaults on other indebtedness exceeding $100 million, bankruptcy/insolvency events, and issues with subsidiary guarantees or collateral security interests.