What is the primary purpose of the Distribution Agreement filed by MPLX?

The primary purpose of the Distribution Agreement is to allow MPLX LP to sell up to $500 million of its common units from time to time through designated sales agents. This provides a flexible way to raise capital in the public markets through "at the market" offerings.

What does "at the market" offering mean in this context?

"At the market" offering means that MPLX can sell its common units at prevailing market prices. These sales can happen through ordinary brokers' transactions on stock exchanges, as block transactions, or through other trading venues, and are executed opportunistically by the sales agents.

How much can MPLX raise through this agreement, and what are the costs involved?

MPLX can raise an aggregate offering price of up to $500,000,000. The costs include commissions paid to the sales agents, which are capped at 2% of the gross sales price per common unit, and certain other expenses incurred by the sales agents related to the offering.

Under which registration statement are these common units being sold?

The common units are being sold under MPLX's shelf registration statement on Form S-3 (Registration No. 333-203067), which was initially filed on March 27, 2015. A prospectus supplement dated May 18, 2015, was filed in connection with this offering.

MPLX/MPLXP 8-K SEC Disclosure

Summary

MPLX LP (MPLX) filed an 8-K on May 18, 2015, to disclose the execution of a Distribution Agreement. This agreement allows MPLX to sell up to $500 million of its common units through various sales agents, including J.P. Morgan Securities, Merrill Lynch, Citigroup Global Markets, Morgan Stanley, and Wells Fargo Securities. The offering is structured as an "at the market" offering, meaning units can be sold at prevailing market prices through exchanges, brokers, or other trading facilities. This provides MPLX with a flexible mechanism to raise capital by opportunistically selling units as market conditions allow, supporting potential growth initiatives or other corporate needs. The agreement enables MPLX to continuously access capital markets by issuing common units over time. The sales agents will receive commissions of up to 2% of the gross sales price per unit, and MPLX will also cover certain expenses. The offering is being made under a previously filed shelf registration statement on Form S-3. Investors should monitor how MPLX utilizes this facility to raise capital and how it impacts unit dilution and the company's financial leverage.

Key Highlights

1MPLX LP entered into a Distribution Agreement on May 18, 2015.
2The agreement allows for the "at the market" sale of up to $500 million of MPLX common units.
3J.P. Morgan Securities, Merrill Lynch, Citigroup Global Markets, Morgan Stanley, and Wells Fargo Securities are acting as sales agents.
4Sales can occur through various market venues, including the New York Stock Exchange, other exchanges, or trading facilities.
5Commissions to sales agents are capped at 2% of the gross sales price per unit.
6The offering is made under MPLX's existing shelf registration statement filed on Form S-3.
7This agreement provides MPLX with a flexible tool for raising equity capital.

MPLX LP 8-K Report, Corporate Update (May 18, 2015)

Summary

Key Highlights

Frequently Asked Questions