UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): December 28, 2017
Tallgrass Energy Partners, LP
(Exact name of registrant as specified in its charter)
| Delaware | 001-35917 | 46-1972941 | ||
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(State or Other Jurisdiction of Incorporation or Organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
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4200 W. 115th Street, Suite 350 Leawood, Kansas |
66211 | |||
| (Address of Principal Executive Offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (913) 928-6060
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 5.03 | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On December 28, 2017, Tallgrass MLP GP, LLC (“TEP GP”), the general partner of Tallgrass Energy Partners, LP (the “Partnership”), entered into Amendment No. 1 (the “Amendment”) to Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of May 17, 2013 (the “Partnership Agreement”), in response to certain changes to the Internal Revenue Code enacted by the Bipartisan Budget Act of 2015 relating to partnership audit and adjustment procedures.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the complete text of the Amendment, a copy of which is filed as Exhibit 3.1 to this Current Report on Form 8-K and incorporated herein by reference.
| Item 7.01 | Regulation FD Disclosure. |
On December 28, 2017, the Partnership issued a press release announcing that Continental Resources, Inc. exercised its contractual right to extend its Throughput and Deficiency Agreements to ship crude oil with Belle Fourche Pipeline Company and with the Partnership’s subsidiary, Tallgrass Pony Express Pipeline, LLC, through October 31, 2024. A copy of the press release is furnished with this Form 8-K as Exhibit 99.1 and incorporated into this Item 7.01 by reference.
The information in this Item 7.01 of Form 8-K, including the accompanying Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liability of such section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, regardless of the general incorporation language of such filing, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TALLGRASS ENERGY PARTNERS, LP | ||
| By: | Tallgrass MLP GP, LLC, | |
| its general partner | ||
| Date: December 28, 2017 | By: |
/s/ David G Dehaemers, Jr. |
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| David G. Dehaemers, Jr. | ||||||||
| President and Chief Executive Officer |
Exhibit 3.1
AMENDMENT NO. 1 TO
AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
TALLGRASS ENERGY PARTNERS, LP
This AMENDMENT NO. 1 TO AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF TALLGRASS ENERGY PARTNERS, LP (this “ Amendment ”), dated as of December 28, 2017, is entered into by Tallgrass MLP GP, LLC, a Delaware limited liability company (the “ General Partner ”), as general partner of Tallgrass Energy Partners, LP, a Delaware limited partnership (the “ Partnership ”). Capitalized terms used but not defined herein are used as defined in the Amended and Restated Agreement of Limited Partnership of Tallgrass Energy Partners, LP, dated as of May 17, 2013 (the “ Partnership Agreement ”).
RECITALS :
WHEREAS , the General Partner desires to replace and restate Section 9.3 (Tax Controversies) and Section 9.4 (Withholding) of the Partnership Agreement in their entirety as a result of amendments made to the Code by the Bipartisan Budget Act of 2015 (the “BBA”); and
WHEREAS , pursuant to Section 6.3(c) and Section 9.4 of the Partnership Agreement, the General Partner may treat taxes paid by the Partnership on behalf of, or amounts withheld with respect to, all or less than all of the Partners, as a distribution of Available Cash to such Partners, as determined appropriate under the circumstances by the General Partner; and
WHEREAS , pursuant to Section 9.2(b) of the Partnership Agreement, the General Partner shall determine whether the Partnership should make any other elections permitted by the Code; and
WHEREAS , pursuant to Section 9.3 of the Partnership Agreement, the General Partner is designated as the “tax matters partner” (as defined in Section 6231(a)(7) of the Code) and is authorized and required to represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and to expend Partnership funds for professional services and costs associated therewith, and each Partner agrees to cooperate with the General Partner and to do or refrain from doing any or all things reasonably required by the General Partner to conduct such proceedings; and
WHEREAS, Section 13.1(c) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines to be necessary or appropriate to ensure that the Group Members will not be treated as associations taxable as corporations or otherwise taxed as entities for federal income tax purposes; and
WHEREAS, Section 13.1(d)(i) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines does not adversely affect the Limited Partners (including any particular class of Partnership Interests as compared to other classes of Partnership Interests) in any material respect; and
WHEREAS, Section 13.1(d)(ii)(A) of the Partnership Agreement provides that the General Partner, without the approval of any Partner, may amend any provision of the Partnership Agreement to reflect a change that the General Partner determines is necessary or advisable to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any federal or state agency or judicial authority or contained in any federal or state statute (including the Delaware Act); and
WHEREAS , acting pursuant to the power and authority granted to it under Section 13.1(c) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement is necessary or appropriate to ensure that the Group Members will not be treated as associations taxable as corporations or otherwise taxed as entities for federal income tax purposes; and
WHEREAS, acting pursuant to the power and authority granted to it under Section 13.1(d)(i) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement does not adversely affect the Limited Partners (including any particular class of Partnership Interests as compared to other classes of Partnership Interests) in any material respect; and
WHEREAS, acting pursuant to the power and authority granted to it under Section 13.1(d)(ii)(A) of the Partnership Agreement, the General Partner has determined that the following amendment to the Partnership Agreement is necessary or advisable to satisfy certain requirements, conditions or guidelines contained in the Code and the Treasury Regulations promulgated thereunder.
NOW, THEREFORE, the Partnership Agreement is hereby amended as follows:
Section 1. Amendments .
(a) Section 9.3 of the Partnership Agreement is hereby amended and restated in its entirety as follows:
Section 9.3 Tax Controversies .
(a) For taxable years beginning on or before December 31, 2017, the General Partner is designated as the “tax matters partner” (as defined in Section 6231(a)(7) of the Code, prior to amendment by the Bipartisan Budget Act of 2015 (the “BBA”)). For each taxable year beginning after December 31, 2017, the General Partner shall be or shall designate the “partnership representative” (as defined in Section 6223 of the Code, as amended by the BBA) and any other Persons necessary to conduct proceedings under Subchapter C of Chapter 63 of the Code (as amended by the BBA) for such year. Any such designated Person or Persons shall serve at the pleasure of, and act at the direction of, the General Partner. The partnership representative, as directed by the General Partner, shall exercise any and all authority of the “partnership representative” under the Code (as amended by the BBA), including, without limitation, (i) binding the Partnership and its Partners with respect to actions taken under Subchapter C of Chapter 63 of the Code (as amended by the BBA) and (ii) determining whether to make any available election under Section 6226 of the Code (as amended by the BBA).
(b) The General Partner (acting through the partnership representative to the extent permitted by Section 9.3(a)) is authorized and required to act on behalf of and represent the Partnership (at the Partnership’s expense) in connection with all examinations of the Partnership’s affairs by tax authorities, including resulting administrative and judicial proceedings, and the General Partner is authorized to expend Partnership funds for professional services and costs associated therewith.
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(c) Each Partner agrees to cooperate with the General Partner (or its designee) and to do or refrain from doing any or all things reasonably requested by the General Partner (or its designee) in its capacity as the “tax matters partner” or the “partnership representative,” or as a person otherwise authorized and required to act on behalf of and represent the Partnership pursuant to Section 9.3(b).
(d) The General Partner is authorized to amend the provisions of this Agreement as appropriate to reflect the proposal or promulgation of Treasury Regulations implementing or interpreting the partnership audit, assessment, and collection rules adopted by the BBA, including any amendments to those rules.
(b) Section 9.4 of the Partnership Agreement is hereby amended and restated in its entirety as follows:
Section 9.4 Withholding and Other Tax Payments by the Partnership .
(a) If taxes and related interest, penalties, or additions to tax are paid by the Partnership on behalf of all or less than all of the Partners or former Partners (including, without limitation, any payment by the Partnership of an imputed underpayment under Section 6225 of the Code (as amended by the BBA)), the General Partner may treat such payment as a distribution of cash to such Partners pursuant to Section 6.3 or Section 12.4(c) in the amount of such payment, treat such payment as a general expense of the Partnership, or in the case of an imputed underpayment under Section 6225 of the Code (as amended by the BBA), require that persons who were Partners of the Partnership in the taxable year to which the payment relates (including former Partners) indemnify the Partnership upon request for their allocable share of that payment, in each case as determined appropriate under the circumstances by the General Partner. The amount of any such indemnification obligation of, or deemed distribution of cash to, a Partner or former Partner in respect of an imputed underpayment under Section 6225 of the Code (as amended by the BBA) shall be reduced to the extent that the Partnership receives a reduction in the amount of the imputed underpayment under Section 6225(c) of the Code (as amended by the BBA) which, in the determination of the General Partner, is attributable to actions taken by, the tax status or attributes of, or tax information provided by or attributable to, such Partner or former Partner pursuant to or described in Section 6225(c) of the Code (as amended by the BBA).
(b) Notwithstanding any other provision of this Agreement, the General Partner is authorized to take any action that may be required to cause the Partnership and other Group Members to comply with any withholding requirements established under the Code or any other federal, state or local law including pursuant to Sections 1441, 1442, 1445 and 1446 of the Code, or established under any foreign law. To the extent that the Partnership is required or elects to withhold and pay over to any taxing authority any amount resulting from the allocation or distribution of income or from a distribution to any Partner (including by reason of Section 1446 of the Code), the General Partner may treat the amount withheld as a distribution of cash pursuant to Section 6.3 or Section 12.4(c) in the amount of such withholding from such Partner.
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Section 2. General Authority . The appropriate officers of the General Partner are hereby authorized to make such further clarifying and conforming changes they deem necessary or appropriate, and to interpret the Partnership Agreement, to give effect to the intent and purpose of this Amendment.
Section 3. Ratification of Partnership Agreement . Except as expressly modified and amended herein, all of the terms and conditions of the Partnership Agreement shall remain in full force and effect.
Section 4. Governing Law . This Amendment will be governed by and construed in accordance with the laws of the State of Delaware, without regard to the principles of conflicts of law.
[Signature page follows]
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IN WITNESS WHEREOF, the General Partner has executed this Amendment to be effective as of the date first set forth above.
| GENERAL PARTNER: | ||
| TALLGRASS MLP GP, LLC | ||
| By: |
/s/ David G. Dehaemers, Jr. |
|
| David G. Dehaemers, Jr. | ||
| President and Chief Executive Officer | ||
[Signature Page to Amendment No. 1 to Amended and Restated Agreement of Limited Partnership]
Exhibit 99.1
Tallgrass Energy Partners Announces Continental Resources Contract Extension
LEAWOOD, Kan.— (BUSINESS WIRE)— Tallgrass Energy Partners, LP (“TEP”) today announced that Continental Resources, Inc. (“Continental”) (NYSE: CLR) exercised its contractual right to extend its Throughput and Deficiency Agreements (“TDAs”) to ship crude oil with Belle Fourche Pipeline Company (“BFPL”) and with TEP’s subsidiary, Tallgrass Pony Express Pipeline, LLC (“Pony Express”), through Oct. 31, 2024. The TDAs were previously scheduled to expire on Oct. 31, 2019.
“This is a unique, mutually beneficial opportunity in the current environment to extend Pony Express’s relationship with its largest customer, secure highly desired Bakken crude oil volumes well past our existing contract maturities, and help provide cash flow certainty for Pony Express,” said David G. Dehaemers Jr., President and CEO of Tallgrass Energy. “Pony Express is capable of transporting approximately 400,000 bbl/d, and has just over 300,000 bbl/d currently contracted. This extension fills a portion of the pipeline’s available capacity from the Bakken and for a term of five years beyond the initial contract term, solidifying Pony Express’s long-term position in the crude oil transportation market.”
Starting Jan. 1, 2018, new uncommitted rates on the joint tariff of BFPL, Pony Express and Bridger Pipeline, LLC will be established, resulting in certain committed rates on the joint tariff being adjusted on the same date. These joint tariff committed rates will initially be $3.75 per barrel for Williston basin origin points and $2.86 per barrel for Guernsey, Wyo. origin points on Pony Express.
“We are pleased to extend our long-standing transportation relationship with Pony Express and Belle Fourche,” said Harold Hamm, Chairman and CEO of Continental Resources. “It provides a premier takeaway solution for our Bakken production when considering operational reliability, access to significant refining markets and, of course, access to storage and pipeline connectivity at Cushing. In addition, the extension will facilitate further improvements in the economics of our operations in the Bakken, the nation’s premier onshore oil play.”
“Belle Fourche is pleased to extend our long-standing relationship with one of the premier producers in the Williston Basin,” said Hank True, President of BFPL. “With this extension, we will continue to build out much needed infrastructure that will provide stability in transportation and markets for all involved.”
About Tallgrass Energy
Tallgrass Energy is a family of companies that includes publicly traded partnerships Tallgrass Energy Partners, LP (NYSE: TEP) and Tallgrass Energy GP, LP (NYSE: TEGP), and privately held Tallgrass Development, LP. Operating across 10 states, Tallgrass is a growth-oriented midstream energy operator with transportation, storage, terminal, water, gathering and processing assets that serve some of the nation’s most prolific crude oil and natural gas basins.
To learn more, please visit our website at www.tallgrassenergy.com.
Cautionary Note Concerning Forward-Looking Statements
Disclosures in this press release contain forward-looking statements. All statements, other than statements of historical facts included in this press release that address activities, events or developments that management expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the cash flow certainty for Pony Express in connection with the contract extension. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of TEP and its affiliates, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements, and other important factors that could cause actual results to differ materially from those projected. Any forward-looking statement applies only as of the date on which such statement is made and TEP and its affiliates do not intend to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
Contacts
Tallgrass Energy
Investor and Financial Inquiries
Nate Lien
913-928-6012
investor.relations@tallgrassenergylp.com
or
Media and Trade Inquiries
Phyllis Hammond
303-763-3568
phyllis.hammond@tallgrassenergylp.com