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): April 24, 2019

 

 

PBF LOGISTICS LP

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Delaware   001-36446   35-2470286
(State or other jurisdiction
of incorporation or organization)
  (Commission
File Number)
  (I.R.S. Employer
Identification Number)

One Sylvan Way, Second Floor

Parsippany, New Jersey 07054

(Address of the Principal Executive Offices) (Zip Code)

(973) 455-7500

(Registrant’s Telephone Number, including area code)

N/A

(Former Name or Former Address, if Changed Since Last Report)

 

 

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 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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 1.01

Entry into a Material Definitive Agreement.

Contribution Agreement

On April 24, 2019, PBF Logistics LP (the “Partnership”), and PBF Energy Company LLC (“PBF LLC”), a subsidiary of PBF Energy Inc. (“PBF Energy”), entered into a Contribution Agreement pursuant to which PBF LLC will contribute to the Partnership all of the issued and outstanding limited liability company interests of TVP Holding Company LLC (“TVP Holding”). TVP Holding owns the remaining fifty percent membership interest (the “TVP Holding Interests”) in the Torrance Valley Pipeline Company LLC (“TVPC”), which owns the 189-mile San Joaquin Valley Pipeline system with a throughput capacity of approximately 110,000 barrels per day. The system, segregated into two parts, Northern and Southern portions, is comprised of the M55, M1 and M70 pipelines which are the primary crude gathering and transportation lines that supply PBF Energy’s Torrance refinery. The assets also include 11 pipeline stations with approximately one million barrels of combined tankage and truck unloading capability at two of the stations. The transaction, which is referred to herein as the “TVPC Acquisition,” is expected to close in the second quarter of 2019. Following the closing of the TVPC Acquisition, the Partnership will own 100% of TVPC.

In connection with the closing of the TVPC Acquisition, the Partnership and a subsidiary of PBF Energy will amend an existing mainline transportation services agreement to increase the minimum volume throughput commitment (“MVC”) from a monthly average of approximately 70,000 barrels per day to a monthly average of approximately 75,000 barrels per day. In exchange for the TVP Holding Interests, the Partnership will pay total consideration to PBF LLC of $200.0 million in cash. The Partnership expects to finance the consideration fully with cash through a combination of $135.0 million of gross proceeds from the Offering (as defined below) and a $65.0 million draw-down from the Partnership’s senior secured revolving credit facility.

Each of the parties to the Contribution Agreement is a direct or indirect subsidiary of PBF Energy. As a result, certain individuals, including officers of PBF Energy and officers and directors of PBF Logistics GP LLC (“PBF GP”), the general partner of the Partnership, serve as officers and/or directors of one or more of such entities. PBF Energy, through PBF LLC, currently (as of the date of this Current Report on Form 8-K) owns 29,953,631 common units of the Partnership, representing a 54.1% limited partner interest in the Partnership, based on the number of common units outstanding (before giving effect to the Offering). PBF Energy also indirectly owns the general partner interest in the Partnership, through its control and ownership of PBF GP.

The Conflicts Committee of the Board of Directors of PBF GP, which is comprised of independent directors and was advised by Simmons & Company International, a division of Piper, Jaffray & Co., its independent financial advisor (“Simmons”), and Baker Botts LLP, its legal counsel, approved the terms and conditions of the Contribution Agreement. In approving the terms of the Contribution Agreement, the Conflicts Committee based its decision in part on an opinion from Simmons that the consideration to be paid for 100% of the membership interests in TVP Holding as contemplated by the Contribution Agreement is fair to the Partnership and the common unit holders of the Partnership other than PBF GP and its affiliates other than the Partnership, from a financial point of view.

The foregoing description is not complete and is subject to and qualified in its entirety by reference to the full text of the Contribution Agreement, a copy of which is filed as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference. The Contribution Agreement contains representations and warranties that the parties to the Contribution Agreement made solely for the benefit of each other. The assertions embodied in such representations and warranties are qualified by information contained in disclosure schedules that the parties exchanged in connection with signing the Contribution Agreement. In addition, these representations and warranties (i) may be intended not as statements of fact, but rather as a way of allocating risk to one of the parties if those statements prove to be inaccurate, (ii) may apply materiality standards different from what may be viewed as material to investors and (iii) were made only as of the date of the Contribution Agreement or as of such other date or dates as may be specified in the Contribution Agreement. Moreover, information concerning the subject matter of such representations and warranties may change after the date of the Contribution Agreement, which subsequent information may or may not be fully reflected in the Partnership’s public disclosures. Investors are urged not to rely on such representations and warranties as characterizations of the actual state of facts or circumstances at this time or any other time.


Offering of Common Units

On April 24, 2019, the Partnership entered into subscription agreements (each, a “Subscription Agreement”) to sell an aggregate of 6,585,500 common units (the “Units”) to certain institutional investors in a registered direct public offering (the “Offering”) for gross proceeds of approximately $135.0 million (or a price of $20.50 per common unit). In connection with the Offering, the Partnership and PBF GP, the general partner of the Partnership, entered into a placement agency agreement (the “Placement Agency Agreement”) with RBC Capital Markets (the “Placement Agent”) pursuant to which the Placement Agent agreed to use its best efforts to arrange for the sale of 5,735,000 Units. The Placement Agent has no commitment to purchase or sell any of the Units.

The Partnership expects to use the net proceeds from the Offering to fund a portion of the purchase price for the TVPC Acquisition. If the Partnership does not consummate such transaction, the Partnership intends to use the net proceeds from the Offering for general partnership purposes, which may include reducing indebtedness outstanding under its revolving credit facility. The Offering is not conditioned on the closing of the TVPC Acquisition.

The Placement Agency Agreement requires the Partnership and PBF GP to indemnify the Placement Agent and certain of its affiliates against certain liabilities or to contribute to payments the Placement Agent may be required to make because of any of such liabilities.

The Units are being offered under the Partnership’s effective shelf registration statement on Form S-3 (No. 333-227366) filed with the Securities and Exchange Commission under the Securities Act. The material terms of the Offering are described in the prospectus supplement dated April 24, 2019.

The Offering is expected to close on April 29, 2019, subject to customary closing conditions.

The foregoing description of each of the form of Subscription Agreement and the Placement Agency Agreement is qualified in its entirety by reference to such form of Subscription Agreement and the Placement Agency Agreement, which are filed with this Current Report on Form 8-K as Exhibits 10.1 and 1.1, respectively and is incorporated by reference herein.

In connection with the Offering, Kramer Levin Naftalis & Frankel LLP rendered their opinion as to the validity of the Units and Hunton Andrews Kurth LLP rendered their opinion as to the legal conclusions as they relate to matters of U.S. federal income tax law, which opinions are filed as Exhibit 5.1 and Exhibit 8.1, respectively, hereto and are incorporated by reference herein.

 

Item 2.02

Results of Operations and Financial Condition.

On April 24, 2019, the Partnership issued a press release which included an interim update on the Partnership’s results for the first quarter ended March 31, 2019. A copy of the press release is furnished with this Current Report as Exhibit 99.1 and is incorporated herein by reference.

The information in this Item 2.02 is being “furnished” pursuant to Item 2.02 of Form 8-K, and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. Accordingly, the information in this Item 2.02, including the press release (Exhibit 99.1), will not be incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or under the Exchange Act, unless specifically identified therein as being incorporated therein by reference.


Item 7.01

Regulation FD Disclosure.

On April 24, 2019, the Partnership issued a press release announcing the TVPC Acquisition and providing a first quarter interim update. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

On April 24, 2019, the Partnership issued a press release announcing the Offering. A copy of the press release is attached hereto as Exhibit 99.2 and is incorporated by reference herein.

The information in this Item 7.01 is being “furnished” pursuant to Item 7.01 of Form 8-K, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that Section. Accordingly, the information in this Item 7.01, including the press releases (Exhibit 99.1 and Exhibit 99.2), will not be incorporated by reference into any filing under the Securities Act, or under the Exchange Act, unless specifically identified therein as being incorporated therein by reference.

Forward-Looking Statements

Statements contained in this Current Report on Form 8-K, including the exhibits to this report, reflecting the Partnership’s or its management’s expectations or predictions relating to future plans, results, performance, achievements and the like are considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which may be beyond the Partnership’s control, including the possibility that the Partnership may not consummate the proposed transactions and that actual first quarter 2019 results of operations may differ from the preliminary results we announced, which may cause actual results to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors and uncertainties that may cause actual results to differ include but are not limited to the risks disclosed in the Partnership’s filings with the U.S. Securities and Exchange Commission. All forward-looking statements speak only as of the date hereof. The Partnership undertakes no obligation to revise or update any forward-looking statements except as may be required by applicable law.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit No.

  

Description

1.1

   Placement Agency Agreement dated as of April 24, 2019 by and among PBF Logistics LP, PBF Logistics GP LLC and RBC Capital Markets

2.1*

   Contribution Agreement dated as of April 24, 2019 by and between PBF Logistics LP and PBF Energy Company LLC

5.1

   Opinion of Kramer Levin Naftalis & Frankel LLP

8.1

   Opinion of Hunton Andrews Kurth LLP

10.1

   Form of Subscription Agreement (included as Exhibit B to the Placement Agency Agreement filed as Exhibit 1.1)

23.1

   Consent of Kramer Levin Naftalis & Frankel LLP (included in Exhibit 5.1)

23.2

   Consent of Hunton Andrews Kurth LLP (included in Exhibit 8.1)


99.1

   Press Release (TVPC Acquisition) dated April 24, 2019

99.2

   Press Release (Offering) dated April 24, 2019

 

*

Schedules and Exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Partnership agrees to furnish supplementally a copy of the omitted Exhibits and Schedules to the SEC upon request.


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.

 

    PBF Logistics LP
    By:    PBF Logistics GP LLC, its general partner
Date: April 26, 2019     By:  

/s/ Trecia Canty

      Trecia Canty
      Authorized Officer

Exhibit 1.1

PBF LOGISTICS LP

5,735,000 COMMON UNITS

PLACEMENT AGENCY AGREEMENT

April 24, 2019


April 24, 2019

RBC Capital Markets, LLC

200 Vesey Street, 8 th Floor

New York, New York 10281

Ladies and Gentlemen:

PBF Logistics LP, a Delaware limited partnership (the “ Partnership ”) proposes to issue and sell up to 5,735,000 common units representing limited partner interests in the Partnership to certain investors (collectively, the “ Investors ”). The common units representing limited partner interests in the Partnership are collectively referred to herein as the “ Common Units ,” and the LP Units to be issued and sold by the Partnership pursuant to this Agreement are referred to herein as the “ Units .” In connection with such issuance and sale, the Partnership desires to engage RBC Capital Markets LLC as sole placement agent (the “ Placement Agent ”).

The Partnership and PBF Logistics GP LLC, a Delaware limited liability company and the general partner of the Partnership (the “ General Partner ”), are hereinafter referred to as the “ Partnership Parties .” The Partnership Parties and each of their respective subsidiaries are referred to individually as a “ PBFX Entity ” and collectively as the “ PBFX Entities .”

The Partnership Parties hereby confirm as follows their agreements with the Placement Agent.

1. Agreement to Act as Placement Agent .

(a) On the basis of the representations, warranties and agreements of the Partnership Parties herein contained, and subject to all the terms and conditions of this Placement Agency Agreement (this “ Agreement ”), between the Partnership Parties and you, RBC Capital Markets, LLC shall be the Partnership’s exclusive Placement Agent, acting on a best efforts basis, in connection with the issuance and sale by the Partnership of the Units to the Investors in a proposed offering pursuant to the Registration Statement, with the terms of the offering to be subject to market conditions and negotiations among the Partnership Parties, the Placement Agent and the prospective Investors. As compensation for services rendered, and provided that any of the Units are sold to Investors in the offering, on the Closing Date (as defined in Section 2 hereof), the Partnership Parties shall pay to the Placement Agent an amount in the aggregate equal to 1.70% of the gross proceeds received by the Partnership, or $2.0 million, from the sale of the Units (the “ Placement Fee ”). The sale of the Units shall be made pursuant to subscription agreements in the form included as Exhibit B hereto (each, a “ Subscription Agreement ” and collectively, the “ Subscription Agreements ”). The Partnership Parties shall have the sole right to accept offers to purchase the Units and may reject any such offer in whole or in part.

(b) This Agreement shall not give rise to any commitment by the Placement Agent to purchase any of the Units, and the Placement Agent shall have no authority to bind the Partnership Parties to accept offers to purchase the Units. The Placement Agent shall act on a best efforts basis and does not guarantee that it will be able to raise new capital in the offering and sale of the Units. Subject to the Partnership’s consent, the

 


Placement Agent may retain other brokers or dealers to act as sub-agents on its behalf in connection with the offering of the Units, the fees of which shall be paid out of the Placement Fee. Prior to the earlier of (i) the date on which this Agreement is terminated, and (ii) the Closing Date, the Partnership Parties shall not, without the prior written consent of the Placement Agent, solicit or accept offers to purchase Units (other than pursuant to the exercise of options or warrants to purchase Common Units that are outstanding at the date hereof) otherwise than through the Placement Agent in accordance herewith.

(c) Notwithstanding the foregoing, the Partnership Parties and the Placement Agent acknowledge that the Partnership intends to sell 850,500 Common Units (the “ Tortoise Units ”) to one or more affiliates of Tortoise Capital Advisors L.L.C. pursuant to a Subscription Agreement, and that the Placement Agent is not acting as placement agent with respect to the offer and sale of Tortoise Units and no Placement Fee or other fee will be paid in respect of the sale of such Tortoise Units.

2. Delivery and Payment . At 10:00 a.m., New York City time, on April 29, 2019, or at such other time on such other date as may be agreed upon by the Partnership and the Placement Agent (such date is hereinafter referred to as the “ Closing Date ”), (i) the Placement Agent shall instruct the Investors to wire an amount equal to the price per unit as shown on the cover page of the Prospectus (as hereinafter defined) for the Units to be purchased by each Investor to an account designated by the Partnership, (ii) the Partnership shall deliver the Units to the Investors, which delivery may be made through the facilities of The Depository Trust Company, and (iii) the Partnership Parties will wire the amounts owed to the Placement Agent as provided in this Agreement. The closing (the “ Closing ”) shall take place at the offices of Kramer Levin Naftalis & Frankel, 1177 Avenue of the Americas, New York, New York, or such other location as mutually agreed by the parties. All actions taken at the Closing shall be deemed to have occurred simultaneously.

3. Representations, Warranties and Agreements of the Partnership Parties . The Partnership Parties, jointly and severally, represent, warrant and agree that:

(a) A registration statement on Form S-3 relating to the Units (Registration No. 333-227366) has (i) been prepared by the Partnership in conformity with the requirements of the Securities Act of 1933, as amended (the “ Securities Act ”), and the rules and regulations of the Securities and Exchange Commission (the “ Commission ”) promulgated thereunder; (ii) been filed with the Commission under the Securities Act; and (iii) become effective under the Securities Act. Copies of such registration statement and any amendments thereto have been made available by the Partnership to the Placement Agent. As used in this Agreement:

(i) “ Applicable Time ” means 5:00 p.m. (New York City time) on the date of this Agreement;

(ii) “ Base Prospectus ” means the most recent base prospectus contained in the Registration Statement at the Execution Time;

 

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(iii) “ Effective Date ” means any date as of which any part of such registration statement or any post-effective amendment thereto relating to the Units became, or is deemed to have become, effective under the Securities Act;

(iv) “ Execution Time ” means the date and time that this Agreement is executed and delivered by the parties hereto;

(v) “ Issuer Free Writing Prospectus ” means each “free writing prospectus” (as defined in Rule 405 under the Securities Act) prepared by or on behalf of the Partnership or used or referred to by the Partnership in connection with the offering of the Units;

(vi) “ Prospectus ” means the final prospectus relating to the Units, including the Base Prospectus and the prospectus supplement thereto, as filed with the Commission pursuant to Rule 424(b) of under the Securities Act; and

(vii) “ Registration Statement ” means such registration statement, as amended as of the Effective Date, including any Preliminary Prospectus or the Prospectus and all exhibits to such registration statement.

Any reference to the Registration Statement, the Base Prospectus or the Prospectus shall be deemed to refer to and include any documents incorporated by reference therein pursuant to Form S-3 under the Securities Act. Any reference to any amendment or supplement to the Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any document filed under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), after the date of such Preliminary Prospectus or Prospectus and incorporated by reference in such Preliminary Prospectus or Prospectus. Any reference to any amendment to the Registration Statement shall be deemed to include any periodic or current report of the Partnership filed with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act after the Effective Date that is incorporated by reference in the Registration Statement.

(b) The Commission has not issued any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus or suspending the effectiveness of the Registration Statement, and no proceeding for any such purpose or pursuant to Section 8A of the Securities Act against the Partnership or relating to the offering of the Units has been instituted or, to the Partnership Parties’ knowledge, threatened by the Commission.

(c) The Partnership has been since the time of initial filing of the Registration Statement and continues to be eligible to use Form S-3 for the offering of the Units.

(d) The Registration Statement conformed and will conform in all material respects, on the Effective Date and on the Closing Date, and any amendment to the Registration Statement filed after the date hereof will conform in all material respects, when filed with the Commission, to the requirements of the Securities Act and the rules and regulations promulgated thereunder. The most recent Preliminary Prospectus conforms on the date hereof, and the Prospectus and any amendment or supplement

 

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thereto will conform in all material respects, when filed with the Commission pursuant to Rule 424(b) under the Securities Act and on the Closing Date, to the requirements of the Securities Act and the rules and regulations promulgated thereunder. The documents incorporated by reference in the Prospectus conformed or will conform in all material respects, when filed with the Commission, to the requirements of the Exchange Act or the Securities Act, as applicable, and the rules and regulations of the Commission thereunder.

(e) The Registration Statement did not, as of the Effective Date, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Prospectus in reliance upon and in conformity with written information furnished by the Placement Agent to the Partnership specifically for inclusion therein, which information is specified in Section 10(b) hereof.

(f) The Prospectus did not, as of the Applicable Time, contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Prospectus in reliance upon and in conformity with written information furnished by the Placement Agent to the Partnership specifically for inclusion therein, which information is specified in Section 10(b) hereof.

(g) The Prospectus and any amendment or supplement thereto will not, as of the Closing Date, contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that no representation or warranty is made as to information contained in or omitted from the Prospectus in reliance upon and in conformity with written information furnished by the Placement Agent to the Partnership specifically for inclusion therein, which information is specified in Section 10(b) hereof.

(h) The Partnership Parties have not made any offer relating to the Units that would constitute an Issuer Free Writing Prospectus.

(i) Each Partnership Party has been duly incorporated or formed, is validly existing as a limited partnership or limited liability company in good standing under the laws of the jurisdiction of its incorporation or formation, has the limited partnership or limited liability company power and authority necessary to own, lease and operate its property and to conduct its business as described in the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership, leasing or operation of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, individually or in the aggregate, result in a material adverse effect on the condition (financial or otherwise), results of operations, business or properties of the Partnership Parties and their subsidiaries, taken as a whole (“ Material Adverse Effect ”).

 

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(j) Each subsidiary of the Partnership has been duly organized, is validly existing as a corporation or limited liability company in good standing under the laws of the jurisdiction of its incorporation or formation, has the entity power and authority necessary to own, lease and operate its property and to conduct its business as described in the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership, leasing or operation of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, individually or in the aggregate, result in a Material Adverse Effect; all of the issued shares of capital stock or other ownership interests of each subsidiary of the Partnership have been duly authorized and validly issued in accordance with the respective bylaws or limited liability company agreements of such subsidiaries (as the same may be amended or restated at or prior to the Closing Date, the “ Operating Agreements ”), and are fully paid (to the extent required by the Operating Agreements) and nonassessable (except as such nonassessability may be affected by Sections 18-607 and 18-804 of the Delaware Limited Liability Company Act (the “ Delaware LLC Act ”) or the applicable provisions of the Delaware General Corporation Law (the “ DGCL ”), as applicable); and with the exception of restrictions on transferability in the Operating Agreements or as described in the Registration Statement and the Prospectus, the Partnership owns such membership interests free and clear of all liens, encumbrances, equities or other claims.

(k) PBF Energy Company LLC (“ PBF LLC ”) owns all of the issued and outstanding membership interests of the General Partner; all of such membership interests have been duly authorized and validly issued in accordance with the limited liability company agreement of the General Partner (as the same may be amended or restated at or prior to the Closing Date, the “ GP LLC Agreement ”), and are fully paid (to the extent required by the GP LLC Agreement) and nonassessable (except as such nonassessability may be affected by Sections 18-607 and 18-804 of the Delaware LLC Act); and with the exception of restrictions on transferability in the GP LLC Agreement or as described in the Registration Statement and the Prospectus, PBF LLC owns such membership interests free and clear of all liens, encumbrances, equities or other claims.

(l) At the Closing Date, after giving effect to the transactions contemplated by this Agreement, PBF LLC will directly own 29,953,631 Common Units (the “ Sponsor Units ”) and such Units shall constitute all of the outstanding Sponsor Units. All of such Sponsor Units and the limited partner interests represented thereby have been duly authorized and validly issued in accordance with the Partnership Agreement, and are fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by Sections 17-303, 17-607 and 17-804 of the Delaware Limited Partnership Act (the “ Delaware LP Act ”)); except for restrictions on transferability contained in the agreement of limited partnership of the Partnership (as the same may be amended and/or restated at or prior to the Closing Date, the “ Partnership Agreement ”) or as described in the Registration Statement and the Prospectus, PBF LLC directly owns the Sponsor Units as described in this paragraph free and clear of all liens, encumbrances, equities or claims.

 

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(m) The General Partner is the sole general partner of the Partnership and owns a noneconomic general partner interest in the Partnership (the “ GP Interest ”). The GP Interest has been duly authorized and validly issued in accordance with the Partnership Agreement), and is fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as nonassessability may be affected by Sections 17-303, 17-607 and 17-804 of the Delaware LP Act); and the General Partner owns the GP Interest free and clear of all liens, encumbrances, equities or claims except restrictions on transferability in the Partnership Agreement or as described in the Registration and the Prospectus.

(n) The General Partner has, and, as of the Closing Date will have, all requisite power and authority to act as the general partner of the Partnership, in all material respects as described in the Registration Statement and the Prospectus.

(o) At the Closing Date, after giving effect to the transactions contemplated by this Agreement and the offering of the Units, the issued and outstanding partnership interests of the Partnership will consist of 61,934,571 Common Units. Other than as described in the Registration Statement and the Prospectus, the Common Units will be the only limited partner interests of the Partnership issued and outstanding at the Closing Date.

(p) Other than the entities listed on Schedule I hereto (all of which are direct or indirect subsidiaries of the Partnership) and its ownership of the GP Interest, the General Partner will not, at the Closing Date, own, directly or indirectly, any equity or long-term debt securities of any corporation, partnership, limited liability company, joint venture, association or other entity. Other than the entities listed on Schedule I hereto, the Partnership will not, at the Closing Date, own, directly or indirectly, any equity or long-term debt securities of any corporation, partnership, limited liability company, joint venture, association or other entity.

(q) This Agreement has been duly authorized, executed and delivered by each of the Partnership Parties.

(r) The proposed Subscription Agreements (together with this Agreement, the “ Transaction Documents ”) have been duly authorized, executed and delivered by each of the Partnership Entities party thereto and are valid and legally binding agreements of the Partnership Entities party thereto enforceable against the Partnership Entities party thereto in accordance with their respective terms,  provided  that the enforceability thereof may be affected by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or transfer and other laws of general applicability relating to or affecting creditors’ rights and by general equitable principles. The Contribution Agreement, dated as of April 24, 2019, by and between the Partnership and PBF LLC (the “ Acquisition Agreement ”) has been duly authorized, executed and delivered by each of the Partnership Entities thereto, and is a valid and legally binding agreement of such Partnership Entities and enforceable against such Partnership Entities in accordance with its terms,  provided  that the enforceability thereof may be affected by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or transfer and other laws of general applicability relating to or affecting creditors’ rights and by general equitable principles.

 

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(s) The Common Units outstanding prior to the issuance of the Units to be sold by the Partnership have been duly authorized and are validly issued in accordance with the Partnership Agreement, fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as nonassessability may be affected by Sections 17-303, 17-607 and 17-804 of the Delaware LP Act).

(t) Except as contained in the Partnership Agreement or described in the Registration Statement and the Prospectus, there are no (i) preemptive rights or other rights to subscribe for or to purchase, nor any restriction upon the voting or transfer of, any equity securities in the Partnership or (ii) outstanding options or warrants to purchase any securities of the Partnership. None of the outstanding equity interests of any Partnership Party were issued in violation of the preemptive or similar rights of any security holder of such Partnership Party. Neither the filing of the Registration Statement nor the offering or sale of the Units as contemplated by this Agreement gives rise to any rights for or relating to the registration of Common Units or other securities of the Partnership, except such rights as have been waived or satisfied.

(u) The Units to be purchased by the Investors have been duly authorized for issuance and sale and, when issued and delivered pursuant to the Transaction Documents against payment of the consideration set forth herein, will be validly issued and fully paid (to the extent required under the Partnership Agreement) and nonassessable (except as such nonassessability may be affected by matters described in Sections 17-303, 17-607 and 17-804 of the Delaware LP Act). The Units, when issued and delivered in accordance with the terms of the Partnership Agreement and the Transaction Documents against payment therefor as provided therein and herein will conform, in all material respects, to the descriptions thereof contained in the Registration Statement and the Prospectus.

(v) None of (i) the offering, issuance or sale by the Partnership of the Units, (ii) the execution, delivery and performance of the Transaction Documents, (iii) the consummation of the transactions contemplated by the Transaction Documents or (iv) the application of the proceeds as described under the caption “Use of Proceeds” in the Registration Statement and the Prospectus will contravene (A) any provision of applicable law, (B) the certificate of incorporation, by-laws, the certificate of formation, limited liability company agreement or partnership agreement, as applicable, of each Partnership Entity, (C) any agreement or any other instrument binding upon each PBFX Entity that is material to the PBFX Entities, taken as a whole, or (D) any judgment, order or decree of any governmental body, agency or court having jurisdiction over a PBFX Entity, except in the case of clauses (A), (B) and (C) as would not, individually or in the aggregate, be expected to result in a Material Adverse Effect.

(w) No consent, approval, authorization or order of, or qualification with, any governmental body or agency is required for the performance by each Partnership Party of its obligations under the Transaction Documents, except (i) as have been obtained or made (or will be prior to the Closing Date) by such Partnership Party, (ii) such as have

 

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been already obtained, or as may be required under (A) the securities or Blue Sky laws of the various states, (B) the Securities Act and the Securities Act Regulations, (C) the NYSE or (D) the Financial Industry Regulatory Authority, Inc. (“ FINRA ”) in connection with the offer and sale of the Units, (iii) as disclosed in the Prospectus and (iv) such consents, approvals, authorizations, orders, registrations and filings the failure to obtain or make would not, individually or in the aggregate, have a Material Adverse Effect or a material adverse effect on the ability of the Partnership to consummate the transactions contemplated by this Agreement.

(x) There has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the PBFX Entities, taken as a whole, from that set forth in the Prospectus.

(y) Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder.

(z) None of the Partnership Parties is, and after giving effect to the offering and sale of the Units and the application of the proceeds thereof as described in the Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

(aa) Except as disclosed in the Prospectus, (i)(A) none of the PBFX Entities is in violation of, or has any liability under, any applicable federal, state, local or non-U.S. statute, law, rule, regulation, ordinance, code, other requirement or rule of law (including common law), or decision or order of any domestic or foreign governmental agency, governmental body or court, relating to pollution, to the use, handling, transportation, treatment, storage or Release (as defined below) or threat of Release of Hazardous Materials (as defined below), to the protection or restoration of the Environment (as defined below), to health and safety including as such relates to exposure to Hazardous Materials (collectively, “ Environmental Laws ”), (B) none of the PBFX Entities owns, occupies, operates or uses any property that to its knowledge requires any response or other corrective action pursuant to any Environmental Law, (C) none of the PBFX Entities is conducting or funding any investigation, response or other corrective action or monitoring of actual or suspected Hazardous Materials at any site or facility, nor is any of them a party to any order, judgment, decree, contract or agreement which imposes any obligation or liability on any of them under any Environmental Law, (D) none of the PBFX Entities is liable or allegedly liable for any Release or, to its knowledge, threatened Release of Hazardous Materials, including at any off-site treatment, storage or disposal site, (E) none of the PBFX Entities has received written notice of any claim, action, suit, investigation or proceeding by any governmental agency or governmental body or person relating to Environmental Laws or Hazardous Materials which is pending, or to their knowledge is any such claim, action, suit, investigation or proceeding threatened, and (F) the PBFX Entities have received and are in compliance with all, and have no liability under any, permits, licenses, authorizations, identification numbers or other approvals

 

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required under applicable Environmental Laws to conduct their respective businesses, except in each case covered by clauses (A) – (F) such as would not individually or in the aggregate have a Material Adverse Effect and (ii) to the knowledge of the Partnership Parties, there are no past or present actions, conditions or occurrences, including the Release or threat of Release of Hazardous Materials, that would reasonably be expected to result in a violation of or liability under any Environmental Law that would have a Material Adverse Effect. For purposes of this subsection “ Hazardous Materials ” means (A) petroleum and petroleum products, by-products or breakdown products, natural gas and natural gas liquids, coal ash, radioactive materials, asbestos and asbestos-containing materials, polychlorinated biphenyls and mold, and (B) any other chemical, material, substance, waste, pollutant or contaminant in any form regulated under Environmental Laws; “ Release ” means any release, spill, emission, discharge, deposit, disposal, leaking, pumping, pouring, dumping, emptying, injection, or leaching into the Environment, or into, from or through any building, structure or facility; “ Environment ” means ambient air, indoor air, surface water, groundwater, drinking water, soil, surface or subsurface strata, and natural resources such as wetlands, flora and fauna.

(bb) Except for rights that have been waived in writing or as disclosed in the Prospectus, (i) there are no contracts, agreements or understandings between any of the Partnership Parties and any person granting such person the right to require any of the Partnership Parties to file a registration statement under the Securities Act with respect to any securities of any of the Partnership Parties or to require the Partnership Parties to include such securities with the Units registered pursuant to the Registration Statement (“ Registration Rights ”), and (ii) any person to whom any of the Partnership Parties has granted Registration Rights and who has the right to exercise such rights prior to the expiration of the Lock-Up Period (as defined below) has agreed not to exercise such rights until after expiration of the Lock-Up Period.

(cc) The operations of the PBFX Entities are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the PBFX Entities conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “ Anti-Money Laundering Laws ”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving any PBFX Entity with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Partnership Parties, threatened.

(dd) None of the PBFX Entities, or any director, officer, or employee thereof, or, to the Partnership Parties’ knowledge, any agent, affiliate or representative of any PBFX Entity, is an individual or entity (“ Person ”) that is, or is owned or controlled by a Person that is (i) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions

 

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authority (collectively, “Sanctions”), nor (ii) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, the Crimea region of the Ukraine, Cuba, Iran, Libya, North Korea, Sudan and Syria).

(ee) None of the PBFX Entities will, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person (A) to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or (B) in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as broker-dealer, advisor, investor or otherwise).

(ff) For the past 5 years, the PBFX Entities have not knowingly engaged in, are not now knowingly engaged in, and will not engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

(gg) None of the PBFX Entities, or any of their respective officers or employees, or to the Partnership Parties’ knowledge, affiliates, directors, agents or representatives of the PBFX Entities: (i) has used any funds for any unlawful contribution, gift, property, entertainment or other unlawful expense relating to political activity; (ii) has made, taken or will take any action in furtherance of any direct or indirect unlawful payment, promise to pay, or authorization or approval of the payment or giving of money, property, gifts or anything else of value, directly or indirectly, to any foreign or domestic government official or employee (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) to improperly influence official action or secure an improper advantage for any Partnership Party or any of their respective subsidiaries; (iii) has made, offered, or taken an act in furtherance of any bribe, unlawful rebate, payoff, influence payment, property, gift, kickback or other unlawful payment; or (iv) is aware of or has taken any action, directly or indirectly, that would result in a violation of any provision of the Bribery Act 2010 of the United Kingdom, or the OECD Convention on Bribery of Foreign Public Officials in International Business Transactions (“ OECD Convention ”), the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (collectively, the “ FCPA ”), including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA), including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, in contravention of the FCPA or any applicable anti-bribery and anticorruption laws or regulations to which any Partnership Party, any of their respective subsidiaries, any director, officer, agent, employee, affiliate or other person associated with or acting on behalf of the Partnership Parties or any of their respective subsidiaries is subject. The

 

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Partnership Parties, their respective subsidiaries and their affiliates have each conducted their businesses in compliance with the FCPA and any applicable anti-bribery and anti-corruption laws or regulations and have instituted and maintain and will continue to maintain policies and procedures designed to promote and ensure, and which are reasonably expected to continue to ensure, continued compliance with all applicable anti-bribery and anti-corruption laws.

(hh) Except as disclosed in the Prospectus, subsequent to the respective dates as of which information is given in each of the Registration Statement and the Prospectus, (i) the Partnership Parties and their respective subsidiaries taken as a whole have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) none of the Partnership Parties has purchased any of its outstanding capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material change in the capital stock (other than in connection with the grant of awards under existing equity incentive plans described in the Prospectus), short-term debt or long-term debt of the Partnership Parties and their respective subsidiaries taken as a whole, except in each case as described in each of the Registration Statement and the Prospectus, respectively.

(ii) Except as disclosed in the Prospectus, the Partnership Parties and their respective subsidiaries have good and marketable title to all real properties and all other properties and assets owned by them, in each case free and clear of all liens, charges, encumbrances and defects, except for such liens, charges, encumbrances and defects (i) as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or (ii) as would not materially adversely affect the value thereof or materially interfere with the use made or to be made thereof by them; and except as disclosed in the Prospectus, the Partnership Parties and their respective subsidiaries hold any material leased real or personal property under valid and enforceable leases, with such exceptions that would not materially adversely interfere with the use made or to be made thereof by them.

(jj) The Partnership Parties and their respective subsidiaries own, possess or can acquire on reasonable terms, adequate trademarks, trade names and other rights to inventions, know how, patents, copyrights, confidential information and other intellectual property (collectively, “ intellectual property rights ”) necessary to conduct the business now operated by them or presently employed by them, except where the failure to own or possess such rights would not result, individually or in the aggregate, in a Material Adverse Effect, and have not received any notice of infringement of or conflict with asserted rights of others with respect to any intellectual property rights that, if determined adversely to the Partnership Parties or any of their respective subsidiaries, would individually or in the aggregate have a Material Adverse Effect.

(kk) No labor dispute with the employees of the Partnership Parties or any of their respective subsidiaries exists or, to the knowledge of the Partnership Parties, is imminent that would have a Material Adverse Effect.

 

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(ll) Except as described in the Prospectus, the Partnership Parties and each of their respective subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; none of the Partnership Parties or any of their respective subsidiaries has been refused any insurance coverage sought or applied for which refusal would reasonably be expected to have a Material Adverse Effect; and none of the Partnership Parties or any of their respective subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not have a Material Adverse Effect, except as described in the Prospectus.

(mm) The Partnership Parties and their respective subsidiaries possess, and are in compliance with the terms of, all certificates, authorizations, franchises, licenses and permits (“ Licenses ”) necessary or material to the conduct of the business described in the Prospectus, except where the failure to possess or be in compliance with the same would not, individually or in the aggregate result in a Material Adverse Effect, and have not received any notice of proceedings relating to the revocation or modification of any Licenses that, if determined adversely to the Partnership Parties or any of their respective subsidiaries, would individually or in the aggregate have a Material Adverse Effect.

(nn) The Partnership Parties and their respective subsidiaries maintain a system of accounting controls that are sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles as applied in the United States and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto. The Partnership has not reported to the Board of Directors of the General Partner fraud involving management or other employees who have a significant role in accounting controls that would have a Material Adverse Effect.

(oo) Except as set forth in the Prospectus, none of the Partnership Parties or any of their respective subsidiaries is reviewing or investigating, and none of the Partnership Parties’ independent auditors or internal auditors have recommended that the Partnership Parties review or investigate, (i) any matter which could result in a restatement of the Partnership Parties’ financial statements for any annual or interim period presented in the Prospectus; or (ii) any fraud involving management or other employees who have a significant role in the system of internal controls maintained by the Partnership Parties and their respective subsidiaries. Except as set forth in the Prospectus, none of the Partnership Parties’ independent auditors nor their respective internal auditors have recommended that any of the Partnership Parties, as applicable, review or investigate adding to, deleting, changing the application of, or changing such Partnership Parties’, as applicable, disclosure with respect to, any of the Partnership Parties’, as applicable, material accounting policies.

 

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(pp) Except as described in the Prospectus, the Partnership Parties have not sold, issued or distributed any Common Units during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than securities issued pursuant to employee benefit plans, equity incentive plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.

(qq) The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.

(rr) Except as will not, individually or in the aggregate, result in a Material Adverse Effect, each of the Partnership Parties and each of their respective subsidiaries (each, a “ Taxpayer ”) has (i) timely filed all federal, state, local and foreign tax returns required to be filed by it through the date hereof or have properly requested extensions thereof, and (ii) paid all federal, state, local and foreign taxes (including any related interest, additions to tax and penalties) required to be paid by it, including in its capacity as a withholding agent, except as may be being contested in good faith. Each Taxpayer has made adequate charges, accruals and reserves in accordance with GAAP in the most recent financial statements referred to in paragraph (mm) below in respect of all material federal, state, local and foreign taxes for all periods as to which the tax liability of such Taxpayer has not been finally determined. There is no tax deficiency that has been, or could reasonably be expected to be, asserted against any Taxpayer or any of its properties or assets that will, individually or in the aggregate, result in a Material Adverse Effect, except those that are being contested in good faith and for which adequate reserves have been established in accordance with GAAP.

(ss) Any third-party statistical and market-related data included in the Prospectus are based on or derived from sources that the Partnership Parties believe to be reliable and accurate in all material respects.

(tt) Except as disclosed in the Prospectus, there are no pending actions, suits or proceedings (including any inquiries or, to the knowledge of the Partnership Parties, investigations by any court or governmental agency or body, domestic or foreign) against or affecting the Partnership Parties, any of their respective subsidiaries or any of their respective properties that, if determined adversely to the Partnership Parties or any of their respective subsidiaries, would individually or in the aggregate have a Material Adverse Effect, or would materially and adversely affect the ability of any of the Partnership Parties to perform its obligations under this Agreement and that are not covered by an indemnity from a prior owner of the Partnership Parties’ or their respective subsidiaries’ assets; and no such actions, suits or proceedings (including any inquiries or investigations by any court or governmental agency or body, domestic or foreign) are threatened or, to the Partnership Parties’ knowledge, contemplated.

 

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(uu) The financial statements of the Partnership included or incorporated by reference in the Prospectus present fairly in all material respects the financial position of the Partnership and its subsidiaries as of the dates shown and their results of operations and cash flows for the periods shown, and, except as otherwise disclosed in the Prospectus, such financial statements have been prepared in conformity with the generally accepted accounting principles in the United States applied on a consistent basis; the financial statements of CPI Operations LLC incorporated by reference in the Prospectus present fairly in all material respects the financial position of CPI Operations LLC as of the dates shown and their results of operations and cash flows for the periods shown, and, except as otherwise disclosed in the Prospectus, such financial statements have been prepared in conformity with the generally accepted accounting principles in the United States applied on a consistent basis.

(vv) Other than with respect to items that would not reasonably be expected to have a Material Adverse Effect, (i) the Partnership Parties and their respective subsidiaries and any “employee benefit plan” (as defined under the Employee Retirement Income Security Act of 1974 (as amended, “ ERISA ,” which term, as used herein, includes the regulations and published interpretations thereunder) established or maintained by the Partnership Parties, their respective subsidiaries or their ERISA Affiliates (as defined below) are in compliance with ERISA; (ii) to the knowledge of the Partnership Parties, each “multiemployer plan” (as defined in Section 4001 of ERISA), if any, to which the Partnership Parties, their respective subsidiaries or an ERISA Affiliate contributes (a “ Multiemployer Plan ”) is in compliance with ERISA; (iii) no “reportable event” (as defined under Section 4043 of ERISA) for which notice has not been waived, has occurred or is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by any of Partnership Parties, their respective subsidiaries or their ERISA Affiliates would have any material liability; (iv) no failure to satisfy the minimum funding standard under Section 412 of the Code, whether or not waived, has occurred or is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by the Partnership Parties, their respective subsidiaries or any of their ERISA Affiliates; (v) no “single employer plan” (as defined in Section 4001 of ERISA) established or maintained by the Partnership Parties, their respective subsidiaries or any of their ERISA Affiliates, if such “employee benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as defined under ERISA); (vi) none of the Partnership Parties, their respective subsidiaries or any of their ERISA Affiliates has incurred or reasonably expects to incur any liability under (A) Title IV of ERISA (including any liability under Section 4062(e) of ERISA) with respect to termination of, or withdrawal from, any “employee benefit plan” or (B) Section 412, 4971, 4975 or 4980B of the Code; and (vii) each “employee benefit plan” established or maintained by the Partnership Parties, their respective subsidiaries or any of their ERISA Affiliates that is intended to be qualified under Section 401(a) of the Code is so qualified and nothing has occurred, whether by action or failure to act, which would cause the loss of such qualification. “ ERISA Affiliate ” means, with respect to the Partnership Parties or any subsidiary thereof, any member of any group of organizations described in Section 414 of the Internal Revenue Code of 1986 (as amended, the “ Code ,” which term, as used herein, includes the regulations and published interpretations thereunder) of which the Partnership Parties or such subsidiary is a member.

 

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(ww) To the knowledge of the Partnership Parties, there are no affiliations or associations between (i) any member of FINRA and (ii) the General Partners’ officers or directors or 5% or greater security holders, except as described in the Registration Statement and the Prospectus.

(xx) The Units have been approved to be listed on the New York Stock Exchange (“ NYSE ”), subject only to official notice of issuance.

(yy) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) the Partnership Parties and their respective subsidiaries have (A) operated and currently operate their respective businesses in a manner compliant with all applicable foreign, federal, state and local laws and regulations, all contractual obligations and all of the Partnership Parties’ policies (internal and posted) related to privacy and data security applicable to the Partnership Parties and their respective subsidiaries, collection, use, handling, transfer, transmission, storage, disclosure and/or disposal of the data of their respective customers, employees and other third parties (the “ Privacy and Data Security Laws ”) and (B) implemented, monitored and have been and are in compliance with, applicable administrative, technical and physical safeguards and policies and procedures designed to ensure compliance with Privacy and Data Security Laws and (ii) except as described in the Prospectus, there has been no loss or unauthorized access, use, modification or breach of security of customer, employee or third party data maintained by or on behalf of the Partnership Parties and their respective subsidiaries, and neither of the Partnership Parties or their respective subsidiaries have notified, nor has the current intention to notify, any customer, governmental entity or the media of any such event with regard to any material data breach.

Any certificate signed by any officer of the General Partner and delivered to the Placement Agent or counsel for the Placement Agent in connection with the offering of the Units shall be deemed a representation and warranty by the General Partner to the Placement Agent, as to matters covered thereby, to the Placement Agent.

4. Lock-up Covenant . The Partnership Parties hereby agree that, without the prior written consent of the Placement Agent, it will not, during the period ending 30 days after the date of the Prospectus (the “ Lock-Up Period ”), (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, Common Units or any other securities so owned convertible into or exercisable or exchangeable for Common Units, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Units, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Units or such other securities, in cash or otherwise or (iii) file any registration statement with the Commission relating to the offering of Common Units or any securities convertible into or exercisable or exchangeable for Common Units.

 

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The restrictions contained in the preceding paragraph shall not apply to (A) the Units to be sold hereunder, (B) the issuance by the Partnership of Common Units upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof of which the Placement Agent has been advised in writing or to the extent disclosed in the Prospectus, (C) the issuance by the Partnership of options, rights or other equity-based compensation pursuant to equity compensation plans described in the Prospectus (including any amendments thereto); provided that any officers or directors who are recipients thereof enter into lock-up agreements with the Placement Agent in the form of Exhibit A hereto with respect to the remaining 30-day restricted period or any extension thereof or, in the case of the issuance of options, rights or phantom awards, such options, rights or phantom awards, as applicable, do not become exercisable or vested during the 30-day restricted period or any extension thereof, (D) (1) the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of Common Units, provided that (i) such plan does not provide for the transfer of Common Units during the 30-day restricted period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by the Partnership regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Units may be made under such plan during the 30-day restricted period or (2) the transfer of Common Units executed under a trading plan by the Partnership pursuant to Rule 10b5-1 under the Exchange Act as existing on the date of this Agreement, (E) as consideration for bona fide acquisitions, the issuance by the Partnership of up to an aggregate 10% of the Common Units (as adjusted for unit splits, unit dividends and other similar events after the date hereof) issued and outstanding as of the date of such acquisition agreement, provided that in the case of this clause (E), upon of receipt of securities, each recipient of such securities issued pursuant thereto shall sign and deliver a lock-up agreement in the form attached hereto as Exhibit A with respect to the remaining 30-day restricted period or any extension thereof, and the filing of a registration statement with respect thereto or (F) the filing of one or more registration statements on Form S-8 with the Commission with respect to Common Units issued or issuable under any equity compensation plan.

5. Conditions of Placement Agent’s Obligations . The obligations of the Placement Agent are subject to the accuracy of the representations and warranties of the Partnership Parties contained herein or in certificates of any officer of the PBFX Entity delivered pursuant to the provisions hereof, to the performance by each of the Partnership Parties of its covenants and other obligations hereunder, and to the following further conditions:

(a) The Registration Statement has been and remains effective and at the Closing Date, no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the Securities Act, no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Partnership’s knowledge, contemplated; and the Partnership has complied with each request (if any) from the Commission for additional information with respect thereto.

 

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(b) The Prospectus shall have been filed with the Commission pursuant to Rule 424(b) under the Securities Act at or before 5:30 p.m., Eastern time, on the second full business day after the date of this Agreement (or such earlier time as may be required under the Securities Act).

(c) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:

(i) there shall not have occurred any downgrading, nor shall any public notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the securities of the PBFX Entities by any “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) of the Exchange Act; and

(ii) there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the PBFX Entities, taken as a whole, from that set forth in the Prospectus that, in your judgment, is material and adverse and that makes it, in your judgment, impracticable to market the Units on the terms and in the manner contemplated in the Prospectus.

(d) The Placement Agent shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of each Partnership Party, on behalf of the applicable Partnership Party, to the effect set forth in Section 5(c) above and to the effect that the representations and warranties of the Partnership Parties contained in this Agreement are true and correct as of the Closing Date and that the Partnership Parties have complied in all material respects with all of the agreements and satisfied all of the conditions on their part to be performed or satisfied hereunder on or before the Closing Date. The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.

(e) The Placement Agent shall have received on the Closing Date an opinion and negative assurance letter of Kramer Levin Naftalis & Frankel LLP, outside counsel for the Partnership Parties, dated the Closing Date, in form and substance reasonably satisfactory to the Placement Agent.

(f) The Placement Agent shall have received on the Closing Date an opinion of Cahill Gordon & Reindel LLP, counsel for the Placement Agent, dated the Closing Date, with respect to such matters as the Placement Agent may require.

(g) The Placement Agent shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Placement Agent, from (i) Deloitte & Touche LLP, an independent registered public accounting firm with respect to the Predecessor and the Partnership, and (ii) KPMG LLP, an independent registered public accounting firm with respect to CPI Operations LLC, in each case, containing statements and information of

 

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the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.

(h) The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and PBF LLC, and certain officers and directors of the Partnership and/or the General Partner relating to sales and certain other dispositions of Common Units or certain other securities, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date.

(i) On the date hereof, the Placement Agent shall have received a certificate, dated the date hereof (with respect to certain financial information contained in the Prospectus) and, at the Closing Date, the Placement Agent shall have received a certificate, dated the Closing Date (with respect to certain financial information contained in the Prospectus), of the Chief Financial Officer of the Partnership as to the accuracy of such certain financial information contained in the Prospectus, as applicable, in form and substance reasonably satisfactory to the Placement Agent.

(j) The Units to be delivered on such Closing Date will have been approved for listing on the NYSE, subject to official notice of issuance.

(k) FINRA has confirmed that it has not raised any objection with respect to the fairness and reasonableness of the terms and arrangements relating to the offering of the Units.

6. Covenants of the Partnership Parties . The Partnership Parties covenant with the Placement Agent as follows:

(a) To furnish to you, without charge, five signed copies of the Registration Statement (including exhibits thereto and documents incorporated by reference) and for delivery to each other Placement Agent a conformed copy of the Registration Statement (without exhibits thereto but including documents incorporated by reference) and to furnish to you in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 6(e) or 6(f) below, as many copies of the Prospectus, any documents incorporated by reference therein and any supplements and amendments thereto or to the Registration Statement as you may reasonably request.

(b) Before amending or supplementing the Registration Statement or the Prospectus, to furnish to you a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which you reasonably object, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.

(c) To furnish to you a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Partnership and not to use or refer to any proposed free writing prospectus to which you reasonably object.

 

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(d) Not to take any action that would result in the Placement Agent or the Partnership being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Placement Agent that the Placement Agent otherwise would not have been required to file thereunder.

(e) If the Prospectus is being used to solicit offers to buy the Units and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances, not misleading, or if any event shall occur or condition exist as a result of which the Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Placement Agent, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Placement Agent and to any dealer upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus is delivered to a prospective purchaser, be misleading or so that the Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Prospectus, as amended or supplemented, will comply with applicable law.

(f) If, during such period after the first date of the public offering of the Units as in the opinion of counsel for the Placement Agent the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is required by law to be delivered in connection with sales by the Partnership, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Placement Agent, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Placement Agent upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.

(g) To endeavor to qualify the Units for offer and sale under the securities or Blue Sky laws of such jurisdictions as you shall reasonably request; provided that in no event shall the Partnership be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits or taxation in any jurisdiction where it is not so subject.

(h) To make generally available to the Partnership’s security holders and to you as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Partnership occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.

 

19


(i) To not take, directly or indirectly, any action designed, or that might reasonably be expected to cause or result in, or that will constitute stabilization or manipulation of the price of any security of the Partnership, to facilitate the sale or resale of any of the Units.

7. Expenses . Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Partnership Parties, jointly and severally, agree to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Partnership’s counsel, the Partnership’s accountants and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Partnership and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Placement Agent and dealers, in the quantities hereinabove specified, (ii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Units under state securities laws and all expenses in connection with the qualification of the Units for offer and sale under state securities laws as provided in Section 6(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriter in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iii) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Units and all costs and expenses incident to listing the Units on the NYSE, (iv) the cost of printing certificates representing the Units, (v) the costs and charges of any transfer agent, registrar or depositary, (vi) the document production charges and expenses associated with printing this Agreement and (vii) all other costs and expenses incident to the performance of the obligations of the Partnership Parties hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section, Section 9 entitled “Indemnity and Contribution,” and the last sentence of Section 11 below, the Placement Agent will pay all of its own costs and expenses, including fees and disbursements of its counsel, road show expenses and any advertising expenses connected with any offers they may make and other expenses incurred by the Placement Agent on its own behalf in connection with presentations to prospective purchasers of the Units.

The provisions of this Section shall not supersede or otherwise affect any agreement that any of the Partnership Parties may otherwise have for the allocation of such expenses among themselves.

8. Covenants of the Placement Agent . The Placement Agent covenants with the Partnership not to take any action that would result in the Partnership being required to file with the Commission under Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Placement Agent that otherwise would not be required to be filed by the Partnership thereunder, but for the action of the Placement Agent.

 

20


9. Indemnity and Contribution .

(a) The Partnership Parties, jointly and severally, agree to indemnify and hold harmless the Placement Agent, each person, if any, who controls the Placement Agent within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, each affiliate of the Placement Agent within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) and each selling agent of the Placement Agent caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, the Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Partnership information that the Partnership has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any “road show” as defined in Rule 433(h) under the Securities Act (a “ road show ”), or the Prospectus or any amendment or supplement thereto, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to the Placement Agent furnished to the Partnership Parties in writing by the Placement Agent through you expressly for use therein, it being understood and agreed that the only such information consists of the information described as such in subsection (b) below.

(b) The Placement Agent agrees to indemnify and hold harmless the Partnership Parties, the directors of the General Partner, the officers of the General Partner who sign the Registration Statement and each person, if any, who controls the Partnership within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Partnership information that the Partnership has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any road show or the Prospectus or any amendment or supplement thereto, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but only with reference to information relating to the Placement Agent furnished to the Partnership Parties in writing by the Placement Agent through you expressly for use in the Registration Statement, any preliminary prospectus, the Prospectus, any issuer free writing prospectus, road show, or the Prospectus or any amendment or supplement thereto; provided that, with respect to the preceding clause, the Partnership Parties acknowledge that the only information furnished in writing by or on behalf of the Placement Agent expressly for use in the Registration Statement, any preliminary prospectus, the Prospectus, any issuer free writing prospectus, road show, or the Prospectus or any amendment or supplement thereto is the name of the Placement Agent appearing on the cover and under the caption entitled “Plan of Distribution” in the Prospectus. Notwithstanding the provisions of this Section 10(b), in no event shall any indemnity by the Placement Agent under this Section 10(b) exceed the Placement Fee.

 

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(c) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 10(a) or 10(b) such person (the “ indemnified party ”) shall promptly notify the person against whom such indemnity may be sought (the “ indemnifying party ”) in writing (but the failure to so notify the indemnifying party shall not relieve it from any liability that it may have under subsection (a) or (b) above except to the extent that it has been materially prejudiced by such failure (through the forfeiture of substantive rights and defenses)) and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for (A) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Placement Agent and all persons, if any, who control the Placement Agent within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act or who are affiliates of the Placement Agent within the meaning of Rule 405 under the Securities Act and (B) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Partnership Parties, the General Partner’s directors, its officers who sign the Registration Statement and each person, if any, who controls the Partnership within the meaning of either such Section. In the case of any such separate firm for the Placement Agent and such control persons and affiliates of the Placement Agent, such firm shall be designated in writing by the Placement Agent. In the case of any such separate firm for the Partnership Parties, and such directors, officers and control persons of the General Partner, such firm shall be designated in writing by the General Partner. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (1) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (2) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could

 

22


have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding.

(d) To the extent the indemnification provided for in Section 10(a) or 10(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Units or (ii) if the allocation provided by clause 10(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 10(d)(i) above but also the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or parties on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Partnership Parties on the one hand and the Placement Agent on the other hand in connection with the offering of the Units shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Units (before deducting expenses) received by the Partnership Parties and the Placement Fee received by the Placement Agent, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate public offering price of the Units set forth on the cover of the Prospectus. The relative fault of the Partnership Parties on the one hand and the Placement Agent on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Partnership Parties or by the Placement Agent (it being understood and agreed that the only such information by the Placement Agent consists of the information described as such in subsection (b) above) and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

(e) The Partnership Parties and the Placement Agent agree that it would not be just or equitable if contribution pursuant to this Section 10 were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in Section 10(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 10(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 10, the Placement Agent shall be required to contribute any amount in excess of the amount by which the total price at which the Units underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that the Placement Agent has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be

 

23


entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 10 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

(f) The indemnity and contribution provisions contained in this Section 10 and the representations, warranties and other statements of the Partnership Parties contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of the Placement Agent, any person controlling the Placement Agent or any affiliate of the Placement Agent, the Partnership Parties or any person controlling the Partnership Parties or their officers or directors and (iii) acceptance of and payment for any of the Units.

10. Termination . The Placement Agent may terminate this Agreement by notice given by you to the Partnership, if after the execution and delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the NYSE, the American Stock Exchange, the NASDAQ Global Market, the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any securities of the Partnership shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States or other relevant jurisdiction shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in your judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in your judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Units on the terms and in the manner contemplated in the Prospectus.

11. Effectiveness . This Agreement shall become effective upon the execution and delivery hereof by the parties hereto. If this Agreement shall be terminated by the Placement Agent, because of any failure or refusal on the part of the Partnership Parties to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Partnership Parties shall be unable to perform its obligations under this Agreement, then the Partnership Parties will reimburse the Placement Agent for all out-of-pocket expenses (including the reasonable fees and disbursements of their external counsel) reasonably incurred by the Placement Agent in connection with this Agreement or the offering contemplated hereunder.

12. Entire Agreement .

(a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Units, represents the entire agreement between the Partnership Parties, on the one hand, and the Placement Agent, on the other, with respect to the preparation of any preliminary prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Units.

 

24


(b) The Partnership acknowledges that in connection with the offering of the Units: (i) the Placement Agent has acted at arm’s length, are not agents of, and owe no fiduciary duties to, the Partnership or any other person, (ii) the Placement Agent owes the Partnership only those duties and obligations set forth in this Agreement and prior written agreements (to the extent not superseded by this Agreement), if any, and (iii) the Placement Agent may have interests that differ from those of the Partnership. The Partnership waives to the full extent permitted by applicable law any claims it may have against the Placement Agent arising from an alleged breach of fiduciary duty in connection with the offering of the Units.

13. Counterparts . This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

14. Applicable Law . This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.

15. Headings . The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.

16. Notices . All communications hereunder shall be in writing and effective only upon receipt and if to the Placement Agent shall be delivered, mailed or sent to RBC Capital Markets, LLC, 200 Vesey Street, 8th Floor, New York, New York 10281-8098, Attention: Equity Syndicate, phone: 877-822-4089, email: equityprospectus@rbccm.com; if to the Partnership shall be delivered, mailed or sent to 1 Sylvan Way, 2nd Floor, Parsippany, NJ 07054, Fax: (973) 455-7562, Attention: General Counsel, with a copy to Kramer Levin Naftalis & Frankel, 1177 Avenue of the Americas, New York, New York 10036, Attention: Todd E. Lenson and Jordan Rosenbaum, Facsimile: (212) 715-8216.

17. Recognition of the U.S. Special Resolution Regimes.

(a) In the event that the Placement Agent is a Covered Entity and becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from the Placement Agent of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

(b) In the event that the Placement Agent or a BHC Act Affiliate of such Placement Agent becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against the Placement Agent are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

 

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(c) For purposes of this Section 9, a “ BHC Act Affiliate ” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k). “ Covered Entity ” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. §252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. §47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. §382.2(b). “ Default Right ” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable. “ U.S. Special Resolution Regime ” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

 

 

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Very truly yours,
PBF LOGISTICS LP
By: PBF Logistics GP LLC, its general partner
By:  

/s/ Trecia M. Canty

  Name: Trecia M. Canty
  Title: Senior Vice President, General Counsel
PBF LOGISTICS GP LLC
By:  

/s/ Trecia M. Canty

  Name: Trecia M. Canty
  Title: Senior Vice President, General Counsel

Signature Page to Placement Agency Agreement


Accepted as of the date hereof
RBC CAPITAL MARKETS LLC
By:  

/s/ R. Michael Ventura

  Name: R. Michael Ventura
  Title: Director, Equity Capital Markets

Signature Page to Placement Agency Agreement

 


SCHEDULE I

SUBSIDIARIES

 

1.

PBF Logistics Finance Corporation

 

2.

Delaware City Terminaling Company LLC

 

3.

Toledo Terminaling Company LLC

 

4.

Delaware City Logistics Company LLC

 

5.

Delaware Pipeline Company LLC

 

6.

PBF Logistics Products Terminals LLC

 

7.

PBFX Operating Company LLC

 

8.

Torrance Valley Pipeline Company LLC

 

9.

Paulsboro Natural Gas Pipeline Company LLC

 

10.

Toledo Rail Logistics Company LLC

 

11.

Chalmette Logistics Company LLC

 

12.

Paulsboro Terminaling Company LLC

 

13.

DCR Storage and Loading Company LLC

 

14.

CPI Operations LLC

Schedule 1


EXHIBIT A

FORM OF LOCK-UP LETTER

April [•], 2019

RBC Capital Markets, LLC

200 Vesey Street, 8 th Floor

New York, New York 10281

Ladies and Gentlemen:

The undersigned understands that RBC Capital Markets, LLC (the “ Placement Agent ”), proposes to enter into a Placement Agency Agreement (the “ Placement Agency Agreement ”) with PBF Logistics LP, a Delaware limited partnership (the “ Partnership ”), and PBF Logistics GP LLC, a Delaware limited liability company (the “ General Partner ” and together with the Partnership, the “ Partnership Parties ”), providing for a public offering (the “ Public Offering ”) of common units representing limited partner interests in the Partnership (the “ Common Units ”).

To induce the Placement Agent to continue its efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of the Placement Agent, it will not, during the period commencing on the date hereof and ending 30 days after the date of the final prospectus supplement relating to the Public Offering (the “ Prospectus ”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, Common Units beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)), by the undersigned or any other securities so owned convertible into or exercisable or exchangeable for Common Units or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Units, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Units or such other securities, in cash or otherwise. In addition, the undersigned agrees that, without the prior written consent of the Placement Agent, it will not, during the period commencing on the date hereof and ending 30 days after the date of the Prospectus, make any demand for or exercise any right with respect to, the registration of Common Units or any security convertible into or exercisable or exchangeable for Common Units.

The foregoing paragraph shall not apply to:

(a) transactions relating to Common Units or other securities acquired in open market transactions after the completion of the Public Offering, provided that no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of Common Units, shall be required or shall be voluntarily made during the restricted period referred to in the foregoing paragraph in connection with subsequent sales of such Common Units or other securities;

Exhibit A-1


(b) transfers of Common Units or any security convertible into or exchangeable or exercisable for Common Units (i) as a bona fide gift or for bona fide estate planning purposes, (ii) upon death or by will, testamentary document or intestate succession, (iii) to an immediate family member of the undersigned or to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned, (iv) not involving a change in beneficial ownership, or (v) if the undersigned is a trust, to any beneficiary of the undersigned or to the estate of any such beneficiary;

(c) distributions of Common Units or any security convertible into or exchangeable or exercisable for Common Units to any direct or indirect affiliates (within the meaning set forth in Rule 405 as promulgated by the SEC under the Securities Act of 1933, as amended (the “ Securities Act ”)), current or former partners (general or limited), members or managers of the undersigned, as applicable, or to the estates of any such partners, members or managers, provided that in the case of any transfer or distribution pursuant to clauses (b) or (c), (i) each transferee, donee or distributee shall sign and deliver a lock-up letter substantially in the form of this letter and (ii) no filing under Section 16(a) of the Exchange Act (other than a filing on Form 5), reporting a reduction in beneficial ownership of Common Units, shall be required or shall be voluntarily made during the restricted period referred to in the foregoing paragraph;

(d) (i) the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of Common Units or any security convertible into or exchangeable or exercisable for Common Units, provided that (x) such plan does not provide for the transfer of Common Units or any security convertible into or exchangeable or exercisable for Common Units during the restricted period and (y) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Partnership regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Units may be made under such plan during the restricted period or (ii) the transfer of Common Units executed under a trading plan by the undersigned pursuant to Rule 10b5-1 under the Exchange Act as existing on the date of the Placement Agency Agreement;

(e) the exercise by the undersigned of any outstanding warrants or the exercise or vesting of any equity awards pursuant to employee benefit plans or the sale of Common Units or any security convertible into or exchangeable or exercisable for Common Units underlying warrants or equity awards as part of the cashless exercise of, or for the payment of tax withholdings on, such securities, in each case in connection with equity awards disclosed in the Prospectus or warrants held by the undersigned as of the date of this agreement in accordance with their terms;

(f) the transfer of Common Units or any security convertible into or exercisable or exchangeable for Common Units that occurs by operation of law, such as pursuant to a qualified domestic order or in connection with a divorce settlement;

(g) any transfer of Common Units or any security convertible into or exercisable or exchangeable for Common Units to the Partnership Parties, pursuant to agreements under which the Partnership Parties have the option to repurchase such Units or a right of first refusal with respect to transfers of such Units; or

Exhibit A-2


(h) in the event of undue hardship, any transfer of units after notice to, and with the prior written consent (not to be unreasonably withheld) of, the Placement Agent.

The undersigned also agrees and consents to the entry of stop transfer instructions with the Partnership’s transfer agent and registrar against the transfer of the undersigned’s Common Units except in compliance with the foregoing restrictions.

The undersigned understands that the Partnership and the Placement Agent are relying upon this agreement in proceeding toward consummation of the Public Offering. The undersigned further understands that this agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors and assigns.

This agreement shall automatically terminate upon the earliest of: (i) April 30, 2019, if the Public Offering shall not have occurred on or before that date, (ii) the date that the Partnership advises the Placement Agent, in writing, prior to the execution of the Placement Agency Agreement, that it has determined not to proceed with the Public Offering, and (iii) termination of the Placement Agency Agreement (other than the provisions thereof which survive termination) prior to the sale of any of the Units to the Investors.

Whether or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only be made pursuant to subscription agreements with prospective investors, the terms of which are subject to negotiation between the Partnership Parties and such investors.

 

Very truly yours,

 

(Name)

 

(Address)

Exhibit A-3


EXHIBIT B

FORM OF SUBSCRIPTION AGREEMENT


SUBSCRIPTION AGREEMENT

PBF Logistics LP

One Sylvan Way,

2nd Floor

Parsippany, NJ 07054

The undersigned (the “ Investor ”) hereby confirms its agreement with PBF Logistics LP, a Delaware limited partnership (the “ Partnership ”), as follows:

1. This Subscription Agreement, including the Terms and Conditions for Purchase of LP Units attached hereto as Annex  I (collectively, this “ Agreement ”), is made as of the date set forth below between the Partnership and the Investor.

2. The Partnership represents and warrants that it has authorized the sale and issuance to certain investors of up to an aggregate of 6,585,500 common units representing limited partnership interests in the Partnership (the “ LP Units ”), for a purchase price of $20.50 per LP Unit (the “ Purchase Price ”).

3. The Partnership represents and warrants that the offering and sale of the LP Units (the “ Offering ”) are being made pursuant to (a) an effective Registration Statement on Form S-3 (Registration No. 333-227366) (the “ Registration Statement ”) filed by the Partnership with the Securities and Exchange Commission (the “ Commission ”), including the Prospectus contained therein (the “ Base Prospectus ”), (b) if applicable, certain “free writing prospectuses” (as that term is defined in Rule 405 under the Securities Act of 1933, as amended (the “ Act ”)), that have been or will be filed with the Commission and delivered to the Investor on or prior to the date hereof (the “ Issuer Free Writing Prospectus ”), containing certain supplemental information regarding the LP Units and the terms of the Offering, and (c) a Prospectus Supplement (the “ Prospectus Supplement ” and, together with the Base Prospectus, the “ Prospectus ”) containing certain supplemental information regarding the Partnership, the LP Units and terms of the Offering that have been or will be (i) filed with the Commission, and (ii) delivered to the Investor (or made available to the Investor by the filing by the Partnership of an electronic version thereof with the Commission).

4. The Partnership and the Investor agree that the Investor will purchase from the Partnership and the Partnership will issue and sell to the Investor the LP Units set forth below for the aggregate purchase price set forth below. The LP Units shall be purchased pursuant to the Terms and Conditions for Purchase of LP Units attached hereto as Annex I and incorporated herein by this reference as if fully set forth herein. The Investor acknowledges that the Offering is not being underwritten by the placement agent, RBC Capital Markets, LLC (the “ Placement Agent ”) named in the Prospectus Supplement and that there is no minimum offering amount.

5. The Investor represents that, except as set forth below, (a) it has had no material relationship (exclusive of any investments by the Investor in the Partnership’s securities) within the past three years with the Partnership or persons known to it to be affiliates of the Partnership and (b) it is not a FINRA member or an Associated Person of a FINRA member (as such term is defined under the NASD Membership and Registration Rules Section 1011) as of the Closing. Exceptions:


The representations above are made to the knowledge of the signatory below .

(If no exceptions, write “none.” If left blank, response will be deemed to be “none.”)

6. The Investor represents that it has received (or otherwise had made available to it by the filing by the Partnership of an electronic version thereof with the Commission) the Base Prospectus which is a part of the Partnership’s Registration Statement, the documents incorporated by reference therein and any Issuer Free Writing Prospectus (collectively, the “ Filed Documents ”), prior to or in connection with the receipt of this Agreement. The Investor acknowledges that, prior to the delivery of this Agreement by the Investor to the Partnership, the Investor will receive certain additional information regarding the Partnership and the Offering, including pricing information (the “ Offering Information ” and, collectively with the Filed Documents, the “Disclosure Package ”). Such information may be provided to the Investor by any means permitted under the Act, including the Prospectus Supplement, a free writing prospectus and oral communications, including any live, confidential management presentation.

7. No offer by the Investor to buy LP Units will be accepted and no part of the Purchase Price will be delivered to the Partnership until the Investor has received the Offering Information and the Partnership has accepted such offer by countersigning a copy of this Agreement, and any such offer may be withdrawn or revoked, without obligation or commitment of any kind, at any time prior to the Partnership (or the Placement Agent on behalf of the Partnership) sending (orally, in writing or by electronic mail) notice of its acceptance of such offer. An indication of interest will involve no obligation or commitment of any kind until the Investor has been delivered the Offering Information and this Agreement is accepted and countersigned by or on behalf of the Partnership.

[ Remainder of Page Left Blank Intentionally. Signature Page Follows. ]


Number of LP Units:                                         

Purchase Price Per LP Unit: $                         

Aggregate Purchase Price: $                         

Please confirm that the foregoing correctly sets forth the agreement between us by signing in the space provided below for that purpose.

 

Dated as of:                                                                   , 2019

 

INVESTOR
By:    
Print Name:    
Title:    
Address:    

 

E-mail:  
Phone:  

 

Signature Page – Subscription Agreement


Agreed and Accepted

this                 day of                     , 2019:

PBF LOGISTICS LP

 

By:   PBF Logistics GP LLC,
  its General Partner

 

By:    
Name: Trecia M. Canty
Title: Senior Vice President, General Counsel

Signature Page – Subscription Agreement

 


ANNEX I

TERMS AND CONDITIONS FOR PURCHASE OF LP UNITS

1. Authorization and Sale of the Securities . Subject to the terms and conditions of this Agreement, the Partnership has authorized the sale of the LP Units.

2. Agreement to Sell and Purchase the LP Units; Placement Agent .

2.1 At the Closing (as defined in Section  3.1 ), the Partnership will sell to the Investor, and the Investor will purchase from the Partnership, upon the terms and conditions set forth herein, the number of LP Units set forth on the last page of the Agreement to which these Terms and Conditions for Purchase of LP Units are attached as Annex I (the “ Signature Page ”) for the aggregate purchase price therefor set forth on the Signature Page.

2.2 The Partnership proposes to enter into substantially this same form of Subscription Agreement with certain other investors (the “ Other Investors ”) and expects to complete sales of LP Units to them. The Investor and the Other Investors, if any, are hereinafter collectively referred to as the “ Investors ,” and this Agreement and the Subscription Agreements executed by the Other Investors are hereinafter collectively referred to as the “ Agreements .”

2.3 Investor acknowledges that the Partnership has agreed to pay the Placement Agent a fee (the “ Placement Fee ”) in respect of the sale of LP Units to the Investor.

2.4 Except for the Offering Information, the Partnership confirms that neither it nor any other person acting on its behalf has provided the Investor or any Other Investor or its respective agents or counsel with any information that constitutes or could reasonably be expected to constitute material, non-public information. The Partnership understands and confirms that the Investor will rely on the foregoing representations in effecting transactions in securities of the Partnership.

3. Closings and Delivery of the LP Units and Funds .

3.1 Closing . The completion of the purchase and sale of the LP Units (the “ Closing ”) shall occur, in accordance with Rule 15c6-1 of the Securities Exchange Act of 1934, as amended, and unless otherwise agreed upon by the Partnership and the Placement Agent, at Kramer Levin Naftalis & Frankel, 1177 Avenue of the Americas, New York, New York 10036 at 10:00 am Eastern time on Monday, April 29, 2019 (the “ Closing Date ”). At the Closing, (a) the Partnership shall cause to be delivered to the Investor the number of LP Units set forth on the Signature Page registered in the name of the Investor or, if so indicated on the Investor Questionnaire attached hereto as Exhibit A , in the name of a nominee designated by the Investor and (b) the aggregate purchase price for the LP Units being purchased by the Investor will be delivered by or on behalf of the Investor to the Partnership.

 

I-1


3.2 Conditions to the Obligations of the Parties .

(a) Conditions to the Partnership’s Obligations . The Partnership’s obligation to issue and sell the LP Units to the Investor shall be subject to: (i) the delivery by the Investor, in accordance with the provisions of this Agreement, of the purchase price for the LP Units being purchased hereunder as set forth on the Signature Page and (ii) the accuracy of the representations and warranties made by the Investor in this Agreement and the fulfillment of those undertakings of the Investor in this Agreement to be fulfilled prior to the Closing Date.

(b) Conditions to the Investor’s Obligations . The Investor’s obligation to purchase the LP Units will be subject to (i) the delivery by the Partnership of the LP Units in accordance with the provisions of this Agreement, (ii) the accuracy of the representations and warranties made by the Partnership and the fulfillment of those undertakings of the Partnership to be fulfilled prior to the Closing Date, in each case as contained in this Agreement, and (iii) the condition that the Placement Agent shall not have: (x) terminated the Placement Agency Agreement, dated April 24, 2019 (the “ Placement Agreement ”) pursuant to the terms thereof or (y) determined that the conditions to the closing in the Placement Agreement have not been satisfied. The Investor’s obligations are expressly not conditioned on the purchase by any or all of the Other Investors of the LP Units that they have agreed to purchase from the Partnership. The Investor understands and agrees that, in the event that the Placement Agent determines that the conditions to closing in the Placement Agreement have not been satisfied or if the Placement Agreement may be terminated for any other reason permitted by the Placement Agreement, then the Placement Agent, may, but shall not be obligated to, terminate such Agreement, which shall have the effect of terminating this Subscription Agreement pursuant to Section  13 below.

3.3 Delivery of Funds . In order to effect the settlement of the LP Units purchased by such Investor with the Depository Trust Company (“ DTC ”) through its Deposit/Withdrawal At Custodian (“ DWAC ”) system, on the Closing Date, the Investor shall remit by wire transfer the amount of funds equal to the aggregate purchase price for the LP Units being purchased by the Investor to the following account designated by the Partnership:

Bank Name:

ABA

Account Name:

Account Number:

3.4 Delivery of LP Units. In order to effect the settlement of the LP Units purchased by such Investor through the DTC’s DWAC delivery system, no later than 9:00 a.m. Eastern Time, April  29, 2019 , the Investor shall direct the broker-dealer at which the account or counts to be credited with the LP Units being purchased by such Investor are maintained, which broker/dealer shall be a DTC participant, to set up a DWAC instructing American Stock Transfer & Trust Company, LLC, the Partnership’s transfer agent (the “ Transfer Agent ”), to credit such account or accounts with the LP Units. Such DWAC instruction shall indicate the settlement date for the deposit of the LP Units, which date shall be the Closing Date. At the Closing, the Partnership shall direct the Transfer Agent to credit the Investor’s account or accounts with the LP Units pursuant to the information contained in the DWAC.

 

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4. Survival of Representations, Warranties and Agreements . Notwithstanding any investigation made by any party to this Agreement or by the Placement Agent, all covenants, agreements, representations and warranties made by the Partnership and the Investor herein will survive the execution of this Agreement, the delivery to the Investor of the LP Units being purchased and the payment therefor.

5. Notices . All notices, requests, consents and other communications hereunder will be in writing, will be mailed (a) if within the domestic United States by first-class registered or certified airmail, or nationally recognized overnight express courier, postage prepaid, or by facsimile or (b) if delivered from outside the United States, by International Federal Express or facsimile, and (c) will be deemed given (i) if delivered by first-class registered or certified mail domestic, three business days after so mailed, (ii) if delivered by nationally recognized overnight carrier, one business day after so mailed, (iii) if delivered by International Federal Express, two business days after so mailed and (iv) if delivered by facsimile, upon electric confirmation of receipt and will be delivered and addressed as follows:

(a)     if to the Partnership , to:

PBF Logistics LP

c/o PBF Logistics GP LLC

One Sylvan Way, 2nd Floor

Parsippany, NJ 07054

Attention: Trecia Canty, Senior Vice President, General Counsel

Facsimile: (973) 971-3654

(b)     if to the Investor , at its address on the Signature Page hereto, or at such other address or addresses as may have been furnished to the Partnership in writing.

6. Changes . This Agreement may not be modified or amended except pursuant to an instrument in writing signed by the Partnership and the Investor.

7. Headings . The headings of the various sections of this Agreement have been inserted for convenience of reference only and will not be deemed to be part of this Agreement.

8. Severability . In case any provision contained in this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein will not in any way be affected or impaired thereby.

9. Governing Law . This Agreement will be governed by, and construed in accordance with, the internal laws of the State of New York, without giving effect to the principles of conflicts of law that would require the application of the laws of any other jurisdiction. Except as set forth below, no proceeding may be commenced, prosecuted or continued in any court other than the courts of the State of New York located in the City and County of New York or the United States District Court for the Southern District of New York, which courts shall have jurisdiction over the adjudication of such matters, and the parties hereby consent to the jurisdiction of such courts and personal service with respect thereto. All parties

 

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hereby waive all right to trial by jury in any proceeding (whether based upon contract, tort or otherwise) in any way arising out of or relating to this Agreement. All parties agree that a final judgment in any such proceeding brought in any such court shall be conclusive and binding upon each party and may be enforced in any other courts in the jurisdiction of which a party is or may be subject, by suit upon such judgment.

10. Counterparts . This Agreement may be executed in two or more counterparts, each of which will constitute an original, but all of which, when taken together, will constitute but one instrument, and will become effective when one or more counterparts have been signed by each party hereto and delivered to the other parties. Delivery of an executed counterpart by facsimile or portable document format (.pdf) shall be effective as delivery of a manually executed counterpart thereof.

11. Confirmation of Sale . The Investor acknowledges and agrees that such Investor’s receipt of the Partnership’s signed counterpart to this Agreement, together with the Prospectus Supplement (or the filing by the Partnership of an electronic version thereof with the Commission), shall constitute written confirmation of the Partnership’s sale of LP Units to such Investor.

12. Press Release . The Partnership and the Investor agree that the Partnership will either (a) file with or furnish to the U.S. Securities and Exchange Commission a Form 8-K or widely disseminate a press release disclosing any material non-public information concerning the Partnership and the Offering delivered to the Investor (the “ Confidential Information ”) no later than 7:00 p.m. (New York City time) on April 24, 2019, or (b) notify the Placement Agent, for the benefit of the Investor, that the Confidential Information no longer constitutes material non-public information of the Partnership, and that the Investor is released from their obligations relating thereto. The Partnership shall not identify the name of any Investor or any affiliate of any investment adviser of such Investor in any press release or public filing, or otherwise publicly disclose the name of any Investor or any affiliate of investment adviser of such Investor, without such Investor’s prior written consent, unless required by law or the rules and regulations of a national securities exchange.

13. Termination . In the event that the Placement Agreement is terminated by the Placement Agent pursuant to the terms thereof, this Agreement shall terminate without any further action on the part of the parties hereto.

14. Fees and Expenses . Each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement.

 

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EXHIBIT A

PBF LOGISTICS LP

INVESTOR QUESTIONNAIRE

Pursuant to Section  3 of Annex I to the Agreement, please provide us with the following information:

 

1.  The exact name that your LP Units are to be registered in. You may use a nominee name if appropriate:

 

     

2.  The relationship between the Investor and the registered holder listed in response to item 1 above:

 

     

3.  The mailing address of the registered holder listed in response to item 1 above:

 

     

4.  The Social Security Number or Tax Identification Number (EIN) of the registered holder listed in the response to item 1 above:

 

     

5.  Name of DTC Participant (broker-dealer at which the account or accounts to be credited with the LP Units are maintained):

 

     

6.  DTC Participant Number:

 

     

7.  Name of Account at DTC Participant being credited with the LP Units:

 

     

8.  Account Number at DTC Participant being credited with the LP Units:

 

     

9.  Email Address:

 

     

Signature Page – Subscription Agreement

Exhibit 2.1

Execution

 

 

 

CONTRIBUTION AGREEMENT

by and between

PBF ENERGY COMPANY LLC

and

PBF LOGISTICS LP,

dated as of

April 24, 2019

 

 

 


TABLE OF CONTENTS

 

         Page  
ARTICLE I

 

DEFINITIONS AND RULES OF CONSTRUCTION

     2  

Section 1.1

  Definitions      2  

Section 1.2

  Defined Terms      5  

Section 1.3

  Rules of Construction      5  
ARTICLE II

 

CONTRIBUTION; CLOSING

     6  

Section 2.1

  Contribution of Subject Interests      6  

Section 2.2

  Consideration      6  

Section 2.3

  The Closing      6  
ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

 

RELATING TO PBF ENERGY

     7  

Section 3.1

  Organization      7  

Section 3.2

  Authorization; Enforceability      7  

Section 3.3

  No Conflict      8  

Section 3.4

  Capitalization      8  

Section 3.5

  Litigation      8  

Section 3.6

  Brokers’ Fees      9  
ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

     9  

RELATING TO THE PARTNERSHIP

     9  

Section 4.1

  Organization of the Partnership      9  

Section 4.2

  Authorization; Enforceability      9  

Section 4.3

  No Conflict      9  

Section 4.4

  Litigation      10  

Section 4.5

  Brokers’ Fees      10  

Section 4.6

  Financing      10  

Section 4.7

  Investment Representation      10  
ARTICLE V

 

COVENANTS

     10  

Section 5.1

  Conduct of Business      11  

Section 5.2

  Third Party Approvals      11  

Section 5.3

  PBF Distributions      11  

Section 5.4

  Straddle Period Distribution      12  

 

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ARTICLE VI

 

TAX MATTERS

     12  

Section 6.1

  Assistance and Cooperation      12  

Section 6.2

  Tax Allocation and Indemnification      12  

Section 6.3

  Filing of Tax Returns; Payment of Taxes      12  

Section 6.4

  Transfer Taxes      12  

Section 6.5

  Scope      13  
ARTICLE VII

 

CONDITIONS TO OBLIGATIONS

     13  

Section 7.1

  Conditions to Obligations of the Partnership      13  

Section 7.2

  Conditions to the Obligations of PBF Energy      14  
ARTICLE VIII

 

INDEMNIFICATION      14  

Section 8.1

  Survival      14  

Section 8.2

  Indemnification      15  

Section 8.3

  Indemnification Procedures      15  

Section 8.4

  Additional Agreements Regarding Indemnification      16  

Section 8.5

  Waiver of Other Representations      17  

Section 8.6

  Consideration Adjustment      17  

Section 8.7

  Exclusive Remedy      17  
ARTICLE IX

 

TERMINATION

     18  

Section 9.1

  Termination      18  

Section 9.2

  Effect of Termination      18  
ARTICLE X

 

MISCELLANEOUS      18  

Section 10.1

  Notices      18  

Section 10.2

  Assignment      19  

Section 10.3

  Rights of Third Parties      19  

Section 10.4

  Expense      19  

Section 10.5

  Counterparts      19  

Section 10.6

  Entire Agreement      19  

Section 10.7

  Amendments      19  

Section 10.8

  Publicity      20  

Section 10.9

  Severability      20  

Section 10.10

  Governing Law; Jurisdiction      20  

Section 10.11

  Action by the Partnership      20  

Exhibits

 

Exhibit A   -   

Amendment to the Service Orders

 

ii


Schedules

 

Schedule 3.3

   -    PBF Approvals

Schedule 4.3

   -    Partnership Approvals

 

 

iii


CONTRIBUTION AGREEMENT

This CONTRIBUTION AGREEMENT , dated as of April 24, 2019 (this “ Agreement ”), is entered into by and between PBF Energy Company LLC, a Delaware limited liability company (“ PBF Energy ”), and PBF Logistics LP, a Delaware limited partnership (the “ Partnership ”). PBF Energy and the Partnership are each a “ Party ” and together, the “ Parties ”.

RECITALS

A. Torrance Logistics Company LLC, a Delaware limited liability company (“ Torrance Logistics ”) and wholly-owned Subsidiary of PBF Energy, owns 100% of the outstanding membership interests (the “ Subject Interests ”) in TVP Holding Company LLC, a Delaware limited liability company (“ TVP Holding ”);

B. TVP Holding owns 50% of the membership interests (the “ TVP Interests ”) in Torrance Valley Pipeline Company LLC (“ Torrance Pipeline ”) and PBFX Operating Company LLC (“ PBFX Operating ”), a Delaware limited liability company and wholly-owned Subsidiary of the Partnership owns the other 50% of the membership interests in Torrance Pipeline;

C. Prior to the Closing (as defined below):

 

  (i)

Torrance Logistics intends to distribute the Subject Interests to PBF Energy Western Region LLC, a Delaware limited liability company (“ PBF Western ”) and the sole member of Torrance Logistics;

 

  (ii)

Following the distribution in clause (i), PBF Western intends to distribute the Subject Interests to PBF Holding Company LLC, a Delaware limited liability company (“ PBF Holding ”) and the sole member of PBF Western; and

 

  (iii)

Following the distribution in clause (ii), PBF Holding intends to distribute the Subject Interests to PBF Energy, the sole member of PBF Holding (the actions taken in clauses (i) through (iii) collectively, the “ PBF Distributions ”).

D. The Partnership will raise up to $200.0 million of net proceeds (the “ Cash Distribution ”) through a combination of a public equity offering with gross proceeds of up to $135.0 million (the “ Equity Proceeds ”) and borrowings under the Partnership’s Revolving Credit Agreement (the “ Borrowed Funds ”).

E. At the Closing, PBF Energy intends to contribute to the Partnership, and the Partnership intends to accept from PBF Energy, the Subject Interests, and, in exchange, the Partnership intends to pay PBF Energy by means of the Cash Distribution in the amount of $200.0 million.

F. Immediately following the Closing:

 

  (i)

The Partnership intends to contribute the Subject Interests to PBFX Operating; and

 

  (ii)

Following the contribution in clause (i), TVP Holding intends to distribute its 50% interest in Torrance Pipeline to PBFX Operating, resulting in PBFX Operating being Torrance Pipeline’s sole member.

G. In connection with the foregoing transactions, the Parties intend for PBF Holding and Torrance Pipeline to enter into an amendment (the “ Amendment ”) of the existing Service Order (as defined below) under the Transportation Services Agreement (as defined below), in the form attached as Exhibit A hereto.


H. The Conflicts Committee (as defined below) has (i) received an opinion of Simmons Energy, a division of Piper Jaffray & Co., the financial advisor to the Conflicts Committee, that the Consideration paid by the Partnership in exchange for the Subject Interests is fair, from a financial point of view, to the Partnership and the common unitholders of the Partnership other than the General Partner, PBF Energy, PBF Energy Inc. and their respective affiliates, (ii) found this Agreement, the other Transaction Documents (defined below) and the transactions contemplated hereby and thereby to be in the best interests of the Partnership and (iii) approved this Agreement, the other Transactions Documents and the transactions contemplated hereby and thereby.

In consideration of the premises and mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I

DEFINITIONS AND RULES OF CONSTRUCTION

Section  1.1 Definitions . As used herein, the following capitalized terms shall have the following meanings:

Affiliate means, with respect to any Person, any other Person that, directly or indirectly, controls, is controlled by or is under common control with, such specified Person through one or more intermediaries or otherwise. For the purposes of this definition, “ control means, where used with respect to any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by Contract or otherwise. Notwithstanding anything in this definition to the contrary, for the purposes of this Agreement, none of the Partnership and its Subsidiaries, on the one hand, and PBF Parent and its other Subsidiaries (including PBF Energy), on the other hand, shall be considered to be Affiliates with respect to each other.

Business Day means any day that is not a Saturday, Sunday or legal holiday in the States of New York, New Jersey or Delaware or a federal holiday in the United States.

Commission ” means the United States Securities and Exchange Commission.

Common Units ” has the meaning provided such term in the Partnership Agreement.

Conflicts Committee has the meaning provided such term in the Partnership Agreement.

Contract means any legally binding agreement, commitment, lease, license or contract.

Dropdown Aggregate Value means $200.0 million.

Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.

Fundamental Representations means the representations and warranties contained in Section  3.1 , 3.2 , 3.3(c) , 3.4 , 3.6 , 4.1 , 4.2 , 4.3(c) and 4.5 .

 

2


GAAP means generally accepted accounting principles of the United States, consistently applied.

General Partner means PBF Logistics GP LLC, a Delaware limited liability company.

Governmental Authority means any federal, state, local or foreign government or any provincial, departmental or other political subdivision thereof, or any entity, body or authority exercising executive, legislative, judicial, regulatory, administrative or other governmental functions or any court, department, commission, board, bureau, agency, instrumentality or administrative body of any of the foregoing.

Law means any applicable statute, law (including common law), rule, regulation, ordinance, order, judgment, code, injunction, decree or other legally enforceable requirements of a Governmental Authority.

Lien means, with respect to any property or asset, any mortgage, pledge, charge, security interest or other encumbrance of any kind in respect of such property or asset.

Losses means all actual liabilities, losses, damages, fines, penalties, judgments, settlements, awards, costs and expenses (including those required to comply with any injunctive relief and reasonable fees and expenses of counsel); provided, however, that (a) Losses shall not include any special, punitive, exemplary, incidental, consequential or indirect damages nor shall Losses include lost profits, lost opportunities or other speculative damages, except to the extent a Party is required to pay such damages to a third party in connection with a matter for which such Party is entitled to indemnification under Article  VIII , and (b) the amount of any Loss shall be reduced by (i) any insurance proceeds actually recovered with respect to such Loss, (ii) any Tax Benefits with respect to such Loss and (iii) indemnification or reimbursement payments actually recovered from third parties with respect to such Loss.

Material Adverse Effect means, any circumstance, change or effect that (a) is or would reasonably be expected to be materially adverse to the business, operations or financial condition of Torrance Pipeline, or (b) materially impedes or would reasonably be expected to impede the ability of the Parties to complete the transactions contemplated herein, but shall exclude any circumstance, change or effect resulting or arising from:

(i) any change in general economic conditions in the industries or markets in which Torrance Pipeline or its business operate;

(ii) seasonal reductions in revenues or earnings of Torrance Pipeline or its business substantially consistent with the historical results;

(iii) national or international political conditions, including any engagement in hostilities, whether or not pursuant to the declaration of a national emergency or war, or the occurrence of any military or terrorist attack;

(iv) changes in Law or GAAP;

(v) the entry into or announcement of this Agreement, actions contemplated by this Agreement or the consummation of the transactions contemplated hereby.

Notwithstanding the foregoing, clauses (i), (iii) and (iv) shall not apply to the extent such circumstance, change or effect has a materially disproportionate effect on Torrance Pipeline or its business as compared to other entities in the industry or markets in which Torrance Pipeline or its business operate.

 

3


Organizational Documents means any charter, certificate of incorporation, certificate of formation, articles of association, bylaws, partnership agreement, limited liability company agreement or similar formation or governing documents and instruments.

Partnership Agreement means the Third Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of February 13, 2019.

Partnership Transaction Document Parties means the Partnership (including the General Partner when acting in its capacity as the general partner of the Partnership), PBFX Operating, and, with respect to the Amendment, Torrance Pipeline.

PBF Parent ” means PBF Energy Inc., a Delaware corporation.

Person means any individual, firm, corporation, partnership, limited liability company, incorporated or unincorporated association, joint venture, joint stock company, Governmental Authority or other entity of any kind.

Reasonable Efforts means efforts in accordance with reasonable commercial practice and without the incurrence of unreasonable expense.

Representatives means, as to any Person, its officers, directors, employees, counsel, accountants, financial advisers and consultants.

Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.

Service Orders has the meaning set forth in the Transportation Services Agreement.

Subsidiary means, with respect to any Person, any other Person of which (a) more than 50% of (i) the total combined voting power of all classes of voting securities of such entity, (ii) the total combined equity interests or (iii) the capital or profit interests, in each case, is beneficially owned, directly or indirectly, by such Person or (b) the power to vote or to direct the voting of sufficient securities to elect a majority of the board of directors or similar governing body is held by such Person.

Tax means all taxes, assessments, duties, levies, imposts or other similar charges imposed by a Governmental Authority, including all income, franchise, profits, capital gains, capital stock, transfer, gross receipts, sales, use, transfer, service, occupation, ad valorem, property, excise, severance, windfall profits, premium, stamp, license, payroll, employment, social security, unemployment, disability, environmental, alternative minimum, add-on, value-added, backup withholding and other taxes, assessments, duties, levies, imposts or other similar charges of any kind whatsoever (whether payable directly or by withholding and whether or not requiring the filing of a Tax Return), and all estimated taxes, deficiency assessments, additions to tax, additional amounts imposed by any Governmental Authority, penalties and interest.

Tax Authority means any Governmental Authority having jurisdiction over the assessment, determination, collection or imposition of any Tax.

Tax Benefit means, with respect to a Loss, an amount by which the Tax liability of a Person (or group of Persons filing a Tax Return that includes such Person) is reduced as a result of such Loss or the amount of any Tax refund or Tax credit that is generated (including, by deduction, loss, credit or otherwise) as a result of such Loss, and any related interest received from any relevant Tax Authority; provided, however, in each case, only the reasonable present value of any Tax Benefit shall be considered with respect to a Loss.

 

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Tax Return means any report, return, election, document, estimated Tax filing, declaration or other filing provided to any Tax Authority, including any amendments thereto.

Transaction Documents means this Agreement, the Amendment and any other documents of conveyance or other related documents contemplated to be entered into in connection with the Agreement and the transaction contemplated hereby with respect to which the Partnership and PBF Energy are parties.

Transportation Services Agreement means the Transportation Services Agreement, dated as of August 31, 2016, by and between Torrance Pipeline and PBF Holding (as amended or supplemented from time to time).

United States or “ U.S. means United States of America.

Section  1.2 Defined Terms . The following terms are set forth and defined in the following locations in this Agreement:

 

Defined Term    Section Reference
Agreement    Preamble
Amendment    Recital G
Borrowed Funds    Recital D
Cash Distribution    Recital D
Claim Notice    Section 8.3(a)
Closing    Section 2.3(a)
Closing Date    Section 2.3(a)
Contribution    Section 2.1
Effective Time    Section 2.3(a)
Equity Proceeds    Recital D
Indemnified Party    Section 8.3(a)
Indemnifying Party    Section 8.3(a)
Partnership    Preamble
Partnership Approvals    Section 4.3
Partnership Financial Statements    Section 4.9
Partnership Indemnified Parties    Section 8.2(a)
Partnership SEC Documents    Section 4.9
Parties    Preamble
Party    Preamble
PBF Approvals    Section 3.3
PBF Distributions    Recital C(iii)
PBF Energy    Preamble
PBF Holding    Recital C(ii)
PBF Indemnified Parties    Section 8.2(b)
PBF Western    Recital C(i)
PBFX Operating    Recital B
Post-Closing Period    Section 6.2
Pre-Closing Period    Section 6.2
Subject Interests    Recital A
Straddle Period    Section 5.4(a)

 

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Tax Straddle Period    Section 6.2
Third Party Claim    Section 8.3(a)
Torrance Logistics    Recital A
Torrance Pipeline    Recital B
Transfer Taxes    Section 6.4
TVP Holding    Recital A
TVP Interests    Recital B

Section  1.3 Rules of Construction .

(a) All article, section and schedule references used in this Agreement are to articles, sections and schedules to this Agreement unless otherwise specified. The schedules attached to this Agreement constitute a part of this Agreement and are incorporated herein for all purposes.

(b) If a term is defined as one part of speech (such as a noun), it shall have a corresponding meaning when used as another part of speech (such as a verb). Terms defined in the singular have the corresponding meanings in the plural, and vice versa. Unless the context of this Agreement clearly requires otherwise, words importing the masculine gender shall include the feminine and neutral genders and vice versa. The term “includes” or “including” shall mean “including without limitation.” The words “hereof,” “hereto,” “hereby,” “herein,” “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular section or article in which such words appear.

(c) The Parties acknowledge that each Party and its attorney have reviewed this Agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting Party, or any similar rule operating against the drafter of an agreement, shall not be applicable to the construction or interpretation of this Agreement.

(d) The captions in this Agreement are for convenience only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement.

(e) All references to currency herein shall be to, and all payments required hereunder shall be paid in, U.S. dollars.

(f) All accounting terms used herein and not expressly defined herein shall have the meanings given to them under GAAP.

(g) Any event hereunder requiring the payment of cash or cash equivalents on a day that is not a Business Day shall be deferred until the next Business Day.

(h) Unless expressly set forth or qualified otherwise (e.g., by “Business” or “trading”), all references herein to a “day” are deemed to be a reference to a calendar day.

(i) References to any Law are references to such Law as it may be amended from time to time, and references to particular provisions of a Law include a reference to the corresponding provisions of any succeeding Law.

 

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ARTICLE II

CONTRIBUTION; CLOSING

Section  2.1 Contribution of Subject Interests . At the Closing, upon the terms and subject to the conditions set forth in this Agreement, PBF Energy shall contribute to the Partnership, and the Partnership shall accept from PBF Energy, the Subject Interests, free and clear of any Liens, other than transfer restrictions (i) imposed thereon by securities Laws, (ii) arising under the Organizational Documents of Torrance Pipeline or (iii) resulting from actions of the Partnership or any of its Subsidiaries (the “ Contribution ”).

Section  2.2 Consideration . At the Closing, upon the terms and subject to the conditions set forth in this Agreement, in exchange for the Subject Interests, the Partnership shall distribute the Cash Distribution to PBF Energy.

Section  2.3 The Closing .

(a) The closing of the transactions contemplated by this Agreement (the “ Closing ”) shall take place at the offices of PBF Energy, (i) within two Business Days following the satisfaction or, to the extent permitted by applicable Law, waiver of all conditions to the obligations of the Parties set forth in Article VII (other than such conditions as may, by their terms, only be satisfied at the Closing or on the Closing Date) or (ii) at such other place or on such other date as the Parties mutually may agree in writing. The day on which the Closing takes place is referred to as the “ Closing Date ”; provided, however, the Closing shall be deemed to have been consummated at 11:59:59 p.m. (Eastern time) on the Closing Date (the “ Effective Time ”).

(b) At the Closing, PBF Energy will deliver (or cause to be delivered) the following documents and deliverables to the Partnership:

(i) an assignment or assignments effecting the transfer to the Partnership of ownership of all of the Subject Interests together with certificates, if any, representing the Subject Interests and such other documentation as is reasonably required to transfer the Subject Interests to the Partnership;

(ii) a counterpart of the Amendment, executed by PBF Holding; and

(iii) such other certificates, instruments of conveyance and documents as may be reasonably requested by the Partnership and agreed to by PBF Energy prior to the Closing Date to carry out the intent and purposes of this Agreement.

(c) At the Closing, the Partnership will deliver (or cause to be delivered) the following documents and deliverables to PBF Energy or take the following actions:

(i) the Cash Distribution to PBF Energy by wire transfer of immediately available U.S. federal funds to an account specified by PBF Energy;

(ii) a counterpart of the Amendment, executed by Torrance Pipeline; and

(iii) such other certificates, instruments of conveyance and documents as may be reasonably requested by PBF Energy and agreed to by the Partnership prior to the Closing Date to carry out the intent and purposes of this Agreement.

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

RELATING TO PBF ENERGY

PBF Energy hereby represents and warrants to the Partnership as follows:

Section  3.1 Organization . PBF Energy and PBF Holding are each a limited liability company duly formed, validly existing and in good standing under the Laws of the State of Delaware.

Section  3.2 Authorization; Enforceability .

(a) PBF Energy has all requisite limited liability company power and authority to execute and deliver this Agreement and to perform all obligations to be performed by it hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized and approved by all requisite limited liability company action on the part of PBF Energy, and no other limited liability company proceedings on the part of PBF Energy are necessary to authorize this Agreement. This Agreement has been duly and validly executed and delivered by PBF Energy, and this Agreement constitutes a valid and binding obligation of PBF Energy, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity.

(b) PBF Energy and PBF Holding have all requisite limited liability company power and authority to execute and deliver the Transaction Documents (other than this Agreement) to which it will be a party. The execution and delivery of each of the Transaction Documents (other than this Agreement) by PBF Energy and PBF Holding and the consummation of the transactions contemplated thereby have been duly and validly authorized and approved by all requisite limited liability company action on the part of PBF Energy and PBF Holding.

Section  3.3 No Conflict . The execution and delivery of this Agreement by PBF Energy and the other Transaction Documents by PBF Energy and PBF Holding and the consummation of the transactions contemplated hereby (including the PBF Distributions) and thereby (assuming all required filings, consents, approvals, authorizations and notices set forth in Schedule 3.3 (collectively, the “ PBF Approvals ”) have been made, given or obtained) do not and shall not:

(a) violate in any material respect any Law applicable to PBF Energy or PBF Holding;

(b) require any of them to make any filing with, obtain the consent, approval or authorization of, or provide notice to, any Person;

(c) violate the Organizational Documents of PBF Energy or PBF Holding; or

(d) (i) breach or result in the termination of any material Contract to which PBF Energy or PBF Holding is a party, (ii) result in the creation of any Lien upon the Subject Interests or (iii) constitute an event which, after notice or lapse of time or both, would result in any of the foregoing;

except in the case of clauses (a), (b) or (d), as would not, individually or in the aggregate, have a Material Adverse Effect.

Section  3.4 Capitalization .

(a) Upon consummation of the PBF Distributions, PBF Energy will have good and valid title to, hold of record and own the Subject Interests free and clear of any Liens, other than transfer restrictions (i) imposed thereon by securities Laws, (ii) arising under the Organizational Documents of TVP Holding, or (iii) resulting from the actions of the Partnership or any of its Subsidiaries. There are no outstanding options, warrants, rights or other securities convertible into or exchangeable or exercisable for the Subject Interests or any other limited liability company interests of TVP Holding issued or granted and there are no agreements of any kind which may obligate TVP Holding to issue, purchase, redeem or otherwise acquire any of the Subject Interests or any other limited liability company interests, except as may be contained in its Organizational Documents.

 

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(b) TVP Holding is the record and beneficial owner of, and has good and valid title to, the TVP Interests, free and clear of any Liens, other than transfer restrictions (i) imposed thereon by securities Laws, or (ii) arising under the Organizational Documents of Torrance Pipeline. TVP Holdings has not had any business or liabilities other than holding the interest in Torrance Pipeline.

Section  3.5 Litigation . There are no legal actions before any Governmental Authority or lawsuits pending or, to the knowledge of PBF Energy, threatened that would adversely affect the ability of PBF Energy to perform its obligations under this Agreement or the ability of PBF Energy or PBF Holding to perform its obligations under each of the other Transaction Documents to which it is a party, and there are no orders or unsatisfied judgments from any Governmental Authority binding upon PBF Energy or PBF Holding that would adversely affect the ability of PBF Energy to perform its obligations under this Agreement or the ability of PBF Energy or PBF Holding to perform its obligations under any of the other Transaction Documents, except in each case, as would not, individually or in the aggregate, have a Material Adverse Effect.

Section  3.6 Brokers Fees . No broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with the transactions contemplated by this Agreement based upon arrangements made by PBF Energy or any of its Affiliates.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

RELATING TO THE PARTNERSHIP

The Partnership hereby represents and warrants to PBF Energy as follows:

Section  4.1 Organization of the Partnership . The Partnership is a limited partnership duly organized, validly existing and in good standing under the Laws of the State of Delaware.

Section  4.2 Authorization; Enforceability .

(a) The Partnership has all requisite partnership power and authority to execute and deliver this Agreement and to perform all obligations to be performed by it hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized and approved by all requisite limited partnership action on the part of the Partnership, and no other partnership proceeding on the part of the Partnership is necessary to authorize this Agreement. This Agreement has been duly and validly executed and delivered by the Partnership, and this Agreement constitutes a valid and binding obligation of the Partnership, enforceable against it in accordance with its terms, subject to bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity.

(b) Each of the Partnership Transaction Document Parties has all requisite partnership or limited liability company power and authority, as the case may be, to execute and deliver the Transaction Documents (other than this Agreement) to which it will be a party. The execution and delivery of each of the Transaction Documents (other than this Agreement) by the Partnership Transaction Document Parties party thereto and the consummation of the transactions contemplated thereby have been duly and validly authorized and approved by all requisite partnership or limited liability company action, as the case may be, on the part of each of such Partnership Transaction Document Parties.

 

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Section  4.3 No Conflict . The execution and delivery by the Partnership of this Agreement and the other Transaction Documents by each of the Partnership Transaction Document Parties party thereto and the consummation of the transactions contemplated hereby and thereby (assuming all required filings, consents, approvals authorizations and notices set forth in Schedule 4.3 (collectively, the “ Partnership Approvals ”) have been made, given or obtained) do not and shall not:

(a) violate in any material respect, any Law applicable to the Partnership or any of the other Partnership Transaction Document Parties;

(b) require the Partnership to make any filing with, obtain the consent, approval or authorization of, or provide notice to, any Person;

(c) violate any Organizational Document of the Partnership or any of the other Partnership Transaction Document Parties; or

(d) (i) breach any material Contract, to which the Partnership or any of the other Partnership Transaction Document Parties is a party, (ii) result in the termination of any such material Contract, (iii) result in the creation of any Lien upon any of the properties or assets of the Partnership or any of the other Partnership Transaction Document Parties or (iv) constitute an event which, after notice or lapse of time or both, would result in any such breach, termination or creation of a Lien

except, in the case of clause (a), (b) or (d), as would not, individually or in the aggregate, have a Material Adverse Effect.

Section  4.4 Litigation . There are no legal actions before any Governmental Authority or lawsuits pending or, to the knowledge of the Partnership, threatened that would adversely affect the ability of the Partnership to perform its obligations under this Agreement or the ability of each of the Partnership Transaction Document Parties to perform its obligations under of the other Transaction Documents to which it is a party, and there are no orders or unsatisfied judgments from any Governmental Authority binding upon the Partnership or any of the other Partnership Transaction Document Parties that would adversely affect the ability of the Partnership to perform its obligations under this Agreement or the ability of any of the Partnership Transaction Document Parties to perform its obligations under any of the other Transaction Documents to which it is a party, except, in each case, as would not, individually or in the aggregate, have a Material Adverse Effect.

Section  4.5 Brokers Fees . Except for Simmons Energy, a division of Piper Jaffray & Co., in connection with its fairness opinion, no broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with the transactions contemplated by this Agreement based upon arrangements made by the Partnership or any of its Subsidiaries.

Section  4.6 Financing . At or prior to the Closing, the Partnership will have sufficient funds to pay the Cash Distribution to PBF Energy at the Closing.

Section  4.7 Investment Representation . The Partnership is purchasing the Subject Interests for its own account with the present intention of holding the Subject Interests for investment purposes and not with a view to or for sale in connection with any public distribution of the Subject Interests in violation of any federal or state securities Laws. The Partnership acknowledges that the Subject Interests have not been registered under federal and state securities Laws and that the Subject Interests may not be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of unless such transfer, sale, assignment, pledge, hypothecation or other disposition is registered under federal and state securities Laws or pursuant to an exemption from registration under any federal or state securities Laws.

 

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Section  4.8 Partnership SEC Documents . The Partnership has timely filed with the Commission all forms, registration statements, reports, schedules and statements required to be filed by it under the Exchange Act or the Securities Act (all such documents filed on or prior to the date of this Agreement, collectively, the “ Partnership SEC Documents ”). The Partnership SEC Documents, including any audited or unaudited financial statements and any notes thereto or schedules included therein (the “ Partnership Financial Statements ”), at the time filed (in the case of registration statements, solely on the dates of effectiveness) (except to the extent corrected by a subsequently filed Partnership SEC Document filed prior to the date of this Agreement) (i) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading and (ii) complied in all material respects with the applicable requirements of the Exchange Act and the Securities Act, as the case may be. The Partnership Financial Statements were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case of unaudited statements, as permitted by Form 10-Q of the Commission) and fairly present (subject in the case of unaudited statements to normal, recurring and year-end audit adjustments) in all material respects the consolidated financial position and status of the business of the Partnership as of the dates thereof and the consolidated results of its operations and cash flows for the periods then ended. Deloitte & Touche LLP is an independent registered public accounting firm with respect to the Partnership and has not resigned or been dismissed as independent registered public accountants of the Partnership as a result of or in connection with any disagreement with the Partnership on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures.

ARTICLE V

COVENANTS

Section  5.1 Conduct of Business . From the date hereof until the earlier of the Closing and the termination of this Agreement, and except as otherwise contemplated by this Agreement or as required by Law, without the prior written consent of the other Party, no Party shall, and each shall not take any action to cause the other Party to, take any action that would be reasonably likely to result in a Material Adverse Effect (including, on such Party’s ability to perform any of its obligations under this Agreement).

Section  5.2 Third Party Approvals .

(a) The Partnership shall (and shall cause its Subsidiaries to) use Reasonable Efforts to obtain all material consents and approvals of third parties that the Partnership or any of its Subsidiaries are required to obtain in order to consummate the transactions contemplated hereby, including the Partnership Approvals; provided, however , that the Partnership shall not be obligated to pay any consideration therefor to any third party from whom consent or approval is requested.

(b) PBF Energy shall (and shall cause its Affiliates to) use Reasonable Efforts to obtain all material consents and approvals of third parties that PBF Energy or any of its Affiliates are required to obtain in order to consummate the transactions contemplated hereby (including the PBF Distributions), including the PBF Approvals; provided, however , that PBF Energy shall not be obligated to pay any consideration therefor to any third party from whom consent or approval is requested.

 

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Section  5.3 PBF Distributions . From the date of this Agreement until the Closing, PBF Energy shall, and shall cause its Affiliates to, use Reasonable Efforts to cause the PBF Distributions to be consummated prior to the Closing Date, including making all filings with respect thereto and seeking all approvals required in connection therewith; provided, however , that PBF Energy shall not be obligated to effect or consent to any action, individually or in the aggregate, that would have or would reasonably be expected to have a material adverse effect on PBF Energy or any of its Affiliates.

Section  5.4 Straddle Period Distribution .

(a) With respect to any distribution of cash by Torrance Pipeline after the Closing Date related to a period of time that includes, but does not end on, the Closing Date (a “ Straddle Period ”) , the Partnership shall, promptly upon its receipt of any such cash distribution by Torrance Pipeline attributable to the Subject Interests, pay PBF Energy an amount in cash equal to the product of (A) the amount of such cash distribution multiplied by (B) the quotient of (i) the number of days in the period beginning on the first day of the Straddle Period and ending on and including the Closing Date and (ii) the total number of days in the Straddle Period.

(b) The Partnership and PBF Energy agree that any payment by the Partnership pursuant to Section  5.4(a) would be characterized as PBF Energy’s retention of the right to its share of the cash distribution by Torrance Pipeline for the Straddle Period.

ARTICLE VI

TAX MATTERS

Section  6.1 Assistance and Cooperation . PBF Energy and the Partnership agree to furnish or cause to be furnished to each other, upon request, as promptly as practicable, such information (including access to books and records) and assistance relating to the assets or business of Torrance Pipeline as is reasonably requested by PBF Energy, the Partnership or any Affiliate for the filing of any Tax Returns, for the preparation of any audit, and for the prosecution or defense of any Tax claim. The party requesting assistance hereunder shall reimburse the other for reasonable out-of-pocket expenses incurred in providing such assistance. Any information obtained under this Section  6.1 shall be held confidential by the receiving party in the same manner as it holds confidential its own similar information, except (i) as may be otherwise necessary in connection with the filing of Tax Returns or claims for refund or in conducting an audit or other proceeding or (ii) with the consent of PBF Energy and the Partnership.

Section 6.2 Tax Allocation and Indemnification. Except as provided in Section  6.5 , PBF Energy shall retain responsibility for (and shall be entitled to any refunds with respect to), and shall indemnify the Partnership for, all Taxes related to the Subject Interests attributable to taxable periods ending on or prior to the Closing Date (the “ Pre-Closing Period ”) , and the Partnership shall assume responsibility for (and shall be entitled to any refunds with respect to), and shall indemnify PBF Energy for, all Taxes related to the Subject Interests attributable to taxable periods beginning after the Closing Date (the “ Post-Closing Period ”). In the case of any Taxes related to the Subject Interests that are payable for any taxable period that begins before and ends after the Closing Date (any “ Tax Straddle Period ”), the portion of such Taxes attributable to the period of time prior to the Closing Date shall be deemed equal to the amount which would be payable as computed on an interim closing-of-the-books basis if the relevant Tax period ended at the close of business on the Closing Date. PBF Energy shall be responsible for, and shall indemnify the Partnership for, all Taxes related to the Subject Interests with respect to the portion of any Tax Straddle Period prior to the Closing Date. The Partnership shall be responsible for, and shall indemnify PBF Energy for all Taxes related to the Subject Interests with respect to the portion of any Tax Straddle Period after the Closing Date.

 

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Section 6.3 Filing of Tax Returns; Payment of Taxes . Except as otherwise provided, regardless of which party is responsible for Taxes under this Section  6.3 , PBF Energy shall handle payment to the appropriate Governmental Authority of all Taxes related to the Subject Interests with respect to any Pre-Closing Period (and shall file all such Tax Returns), and the Partnership shall handle payment to the appropriate Governmental Authority of all Taxes related to the Subject Interests with respect to any Post-Closing Period (and shall file all such Tax Returns). PBF Energy shall deliver to the Partnership within thirty (30) days of filing copies of all Tax Returns filed by or on behalf of PBF Energy after the Closing Date relating to the Subject Interests and any supporting documentation provided by or on behalf of PBF Energy to taxing authorities, excluding Tax Returns related to income tax, franchise tax, or other similar Taxes.

Section  6.4 Transfer Taxes . All sales, use, transfer, gains, stamp, duties, recording, and similar Taxes (collectively, “ Transfer Taxes ”) incurred in connection with the Contribution and the transfer of Dropdown Aggregate Value pursuant thereto shall be borne equally by PBF Energy and the Partnership. PBF Energy and the Partnership shall cooperate in causing the filing of all necessary Tax Returns and timely pay all such Transfer Taxes as required by Law.

Section  6.5 Scope . Notwithstanding anything to the contrary herein, this Article VI shall be the exclusive remedy for any claims relating to Taxes hereunder. The rights under this Article VI shall survive the Closing until 30 days after the expiration of the statute of limitations (including extensions) applicable to such Tax matter. No claim may be made or brought by any Party hereto after the expiration of the applicable survival period unless such claim has been asserted by written notice specifying the details supporting the claim on or prior to the expiration of the applicable survival period.

ARTICLE VII

CONDITIONS TO OBLIGATIONS

Section  7.1 Conditions to Obligations of the Partnership . The obligation of the Partnership to consummate the transactions contemplated by this Agreement is subject to the satisfaction of the following conditions, any one or more of which may be waived in writing by the Partnership:

(a) all of the PBF Approvals have been made, given or obtained in order to consummate the transactions contemplated hereby (including the PBF Distributions);

(b) each of the representations and warranties of PBF Energy contained in this Agreement shall be true and correct as of the Closing, as if made at and as of that time other than such representations and warranties that expressly address matters only as of a certain date, which need only be true as of such certain date without giving effect to the words “material” or “Material Adverse Effect” contained in such representations and warranties, except where the failure of such representations and warranties to be so true and correct would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; provided, however , the Fundamental Representations of PBF Energy shall be true and correct as of the Closing, as if made at and as of that time.

(c) PBF Energy shall have performed or complied in all material respects with all of the covenants and agreements required by this Agreement to be performed or complied with by it at or before the Closing;

(d) PBF Energy shall have delivered to the Partnership a certificate dated the Closing Date, certifying that the conditions specified in Section  7.1(b) and Section  7.1(c) have been fulfilled;

(e) no statute, rule, regulation, executive order, decree, temporary restraining order, preliminary or permanent injunction, judgment or other order shall have been enacted, entered, promulgated, enforced or issued by any Governmental Authority, or other legal restraint or prohibition preventing the consummation of the transactions contemplated hereby shall be in effect, and no investigation, action or proceeding before a Governmental Authority shall have been instituted or threatened challenging or seeking to restrain or prohibit the transactions contemplated hereby or to recover damages in connection therewith;

 

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(f) the Partnership shall have received an executed counterpart of each of the other Transaction Documents (in addition to this Agreement), signed by PBF Energy or its Affiliates (as applicable);

(g) the PBF Distributions have been consummated without the occurrence of a Material Adverse Effect; and

(h) the Partnership shall have received the Equity Proceeds and the Borrowed Funds and consummated the transactions related thereto.

Section  7.2 Conditions to the Obligations of PBF Energy . The obligation of PBF Energy to consummate the transactions contemplated by this Agreement is subject to the satisfaction of the following conditions, any one or more of which may be waived in writing by PBF Energy:

(a) all of the Partnership Approvals have been made, given or obtained in order to consummate the transactions contemplated hereby (including the PBF Distributions);

(b) each of the representations and warranties of the Partnership contained in this Agreement shall be true and correct as of the Closing, as if made at and as of that time other than such representations and warranties that expressly address matters only as of a certain date, which need only be true as of such certain date without giving effect to the words “material” or “Material Adverse Effect” contained in such representations and warranties, except where the failure of such representations and warranties to be so true and correct would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; provided, however , the Fundamental Representations of the Partnership shall be true and correct as of the Closing, as if made at and as of that time.

(c) the Partnership shall have performed or complied in all material respects with all of the covenants and agreements required by this Agreement to be performed or complied with by the Partnership on or before the Closing;

(d) the Partnership shall have delivered to PBF Energy a certificate, dated the Closing Date, certifying that the conditions specified in Section  7.2(b) and (c)  have been fulfilled;

(e) no statute, rule, regulation, executive order, decree, temporary restraining order, preliminary or permanent injunction, judgment or other order shall have been enacted, entered, promulgated, enforced or issued by any Governmental Authority, or other legal restraint or prohibition preventing the consummation of the transactions contemplated hereby shall be in effect, and no investigation, action or proceeding before a court or any other governmental agency or body shall have been instituted or threatened challenging or seeking to restrain or prohibit the consummation of the transactions contemplated by this Agreement or to recover damages in connection therewith;

(f) PBF Energy shall have received an executed counterpart of each of the other Transaction Documents (in addition to this Agreement), signed by the Partnership or its Subsidiaries (as applicable);

(g) the PBF Distributions have been consummated without the occurrence of a Material Adverse Effect; and

 

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(h) PBF Energy shall have received the Cash Distribution.

ARTICLE VIII

INDEMNIFICATION

Section  8.1 Survival .

(a) The representations and warranties of the Parties contained in this Agreement and all covenants contained in this Agreement that are to be performed prior to the Closing will survive the closing for 18 months following the Closing; provided, however , that the Fundamental Representations shall survive the Closing for five years following the Closing. No Party shall have any liability for indemnification claims made under this Article VIII with respect to any such representation, warranty or pre-closing covenant unless a Claim Notice is provided by the non-breaching Party to the other Party prior to the expiration of the applicable survival period for such representation, warranty or pre-closing covenant. If a Claim Notice has been timely given in accordance with this Agreement prior to the expiration of the applicable survival period for such representation, warranty or pre-closing covenant or claim, then the applicable representation, warranty or pre-closing covenant shall survive as to such claim, until such claim has been finally resolved.

(b) All covenants and agreements of the Parties contained in this Agreement to be performed after the Closing will survive the Closing in accordance with their terms.

Section  8.2 Indemnification .

(a) Subject to Article VI relating to Taxes and the provisions of this Article  VIII , from and after the Closing, PBF Energy shall indemnify and hold harmless the Partnership, the Partnership’s subsidiaries and their respective Representatives (the “ Partnership Indemnified Parties ”) from and against all Losses that the Partnership Indemnified Parties incur arising from or out of any breach of any representation, warranty or covenant of PBF Energy in this Agreement or in any closing certificate to be delivered by PBF Energy at the Closing pursuant to this Agreement.

(b) Subject to Article VI relating to Taxes and the provisions of this Article  VIII , from and after the Closing, the Partnership shall indemnify and hold harmless PBF Energy and its Affiliates and their respective Representatives (the “ PBF Indemnified Parties ”) from and against all Losses that the PBF Indemnified Parties incur arising from or out of or relating to any breach of any representation, warranty or covenant of the Partnership in this Agreement or any closing certificate to be delivered by the Partnership at the Closing pursuant to this Agreement.

(c) Notwithstanding anything to the contrary herein, the Parties shall have a duty to use Reasonable Efforts to mitigate any Loss arising out of or relating to this Agreement or the transactions contemplated hereby.

(d) Notwithstanding anything in this Article VIII to the contrary, all Losses relating to Taxes which are the subject of Article VI shall only be subject to indemnification under Section  6.3 .

Section  8.3 Indemnification Procedures . Claims for indemnification under this Agreement shall be asserted and resolved as follows:

(a) Any Partnership Indemnified Party or PBF Indemnified Party claiming indemnification under this Agreement (an “ Indemnified Party ”) with respect to any claim asserted against the Indemnified Party by a third party (“ Third Party Claim ”) in respect of any matter that is subject to indemnification under Section  8.2 shall promptly (i) notify the Party providing the

 

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indemnification hereunder (the “ Indemnifying Party ”) of the Third Party Claim and (ii) transmit to the Indemnifying Party a written notice (“ Claim Notice ”) describing in reasonable detail the nature of the Third Party Claim, a copy of all papers served with respect to such claim (if any), the Indemnified Party’s best estimate of the amount of Losses attributable to the Third Party Claim and the basis of the Indemnified Party’s request for indemnification under this Agreement. Failure to timely provide such Claim Notice shall not affect the right of the Indemnified Party’s indemnification hereunder, except to the extent the Indemnifying Party is prejudiced by such delay or omission.

(b) The Indemnifying Party shall have the right to defend the Indemnified Party against such Third Party Claim. If the Indemnifying Party notifies the Indemnified Party that the Indemnifying Party elects to assume the defense of the Third Party Claim, then the Indemnifying Party shall have the right to defend such Third Party Claim with counsel selected by the Indemnifying Party (who shall be reasonably satisfactory to the Indemnified Party), by all appropriate proceedings, to a final conclusion or settlement at the discretion of the Indemnifying Party in accordance with this Section  8.3(b) . The Indemnifying Party shall have full control of such defense and proceedings, including any compromise or settlement thereof; provided, however , that the Indemnifying Party shall not enter into any settlement agreement without the written consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned or delayed); provided, further, that such consent shall not be required if (i) the settlement agreement contains a complete and unconditional general release by the third party asserting the claim to all Indemnified Parties affected by the claim and (ii) the settlement agreement does not contain any sanction or restriction upon the conduct of any business by the Indemnified Party or its Affiliates. If requested by the Indemnifying Party, the Indemnified Party agrees, at the sole cost and expense of the Indemnifying Party, to cooperate with the Indemnifying Party and its counsel in contesting any Third Party Claim which the Indemnifying Party elects to contest, including the making of any related counterclaim against the Person asserting the Third Party Claim or any cross complaint against any Person. The Indemnified Party may participate in, but not control, any defense or settlement of any Third Party Claim controlled by the Indemnifying Party pursuant to this Section  8.3(b ), and the Indemnified Party shall bear its own costs and expenses with respect to such participation.

(c) If the Indemnifying Party does not notify the Indemnified Party that the Indemnifying Party elects to defend the Indemnified Party pursuant to Section  8.3(b ), then the Indemnified Party shall have the right to defend, and be reimbursed for its reasonable cost and expense (but only if the Indemnified Party is actually entitled to indemnification hereunder) in regard to the Third Party Claim with counsel selected by the Indemnified Party (who shall be reasonably satisfactory to the Indemnifying Party), by all appropriate proceedings, which proceedings shall be prosecuted diligently by the Indemnified Party. In such circumstances, the Indemnified Party shall defend any such Third Party Claim in good faith and have full control of such defense and proceedings; provided, however , that the Indemnified Party may not enter into any compromise or settlement of such Third Party Claim if indemnification is to be sought hereunder, without the Indemnifying Party’s consent (which consent shall not be unreasonably withheld, conditioned or delayed). The Indemnifying Party may participate in, but not control, any defense or settlement controlled by the Indemnified Party pursuant to this Section  8.3(c ), and the Indemnifying Party shall bear its own costs and expenses with respect to such participation.

(d) Subject to the other provisions of this Article VIII , a claim for indemnification for any matter not involving a Third Party Claim may be asserted by notice to the Party from whom indemnification is sought.

(e) Notwithstanding anything to the contrary in this Section  8.3 , the indemnification procedures set forth in Article VI shall control any indemnities relating to Taxes.

 

16


Section  8.4 Additional Agreements Regarding Indemnification . Notwithstanding anything to the contrary herein:

(a) a breach of any representation or warranty (other than with respect to a breach of the Fundamental Representations) of PBF Energy in this Agreement in connection with any single item or group of related items that results in Losses of less than $50,000 shall be deemed, for all purposes of this Article VIII not to be a breach of such representation, warranty or pre-closing covenant;

(b) PBF Energy shall not have any liability under Section  8.2(a)(i) for breaches of representations or warranties (other than with respect to a breach of the Fundamental Representations) except if the aggregate Losses actually incurred by the Partnership Indemnified Parties thereunder exceed $250,000 and then, subject to Section  8.4(c ), only to the extent such aggregate Losses exceed such amount;

(c) in no event shall (i) the aggregate liability of PBF Energy under Section  8.2(a)(i) for breaches of representations or warranties (other than with respect to a breach of the Fundamental Representations) exceed 10.0% of the Dropdown Aggregate Value and (ii) the aggregate liability of PBF Energy arising out of or relating to Section  8.2(a)(i) for breaches of the Fundamental Representations exceed 100.0% of the Dropdown Aggregate Value;

(d) for purposes of determining the amount of a Loss, with respect to any asserted breach or inaccuracy of a representation or warranty of a Party, such determination shall be made without regard to any qualifier as to “material,” “materiality” or “Material Adverse Effect” expressly contained in Article III or IV ; provided that this Section  8.4(d) shall not so modify the representations and warranties for purposes of first determining whether a breach of any representation or warranty has occurred; and

(e) for the avoidance of doubt, nothing in this Section  8.4 shall affect the provisions of Article VI .

Section  8.5 Waiver of Other Representations . NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, IT IS THE EXPLICIT INTENT OF EACH PARTY HERETO, AND THE PARTIES HEREBY AGREE, THAT NONE OF PBF ENERGY OR ANY OF ITS AFFILIATES OR REPRESENTATIVES HAS MADE OR IS MAKING ANY REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WRITTEN OR ORAL, INCLUDING ANY IMPLIED REPRESENTATION OR WARRANTY AS TO THE CONDITION, MERCHANTABILITY, USAGE, SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE WITH RESPECT TO THE SUBJECT INTERESTS, EXCEPT THOSE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT.

Section 8.6 Consideration Adjustment . The Parties agree to treat all payments made pursuant to this Article VIII as adjustments to the Cash Distribution for Tax purposes, except as otherwise required by Law following a final determination by the U.S. Internal Revenue Service or a Governmental Authority with competent jurisdiction.

Section  8.7 Exclusive Remedy .

(a) Notwithstanding anything to the contrary herein, except as provided in Section  6.3 , 6.5 , 8.2 or 9.2 , no Party shall have any liability, and no Party shall make any claim, for any Loss or other matter (and the Partnership and PBF Energy hereby waive any right of contribution against the other and their respective affiliates), under, arising out of or relating to this Agreement, any other document, agreement, certificate or other matter delivered pursuant hereto or the transactions contemplated hereby, whether based on contract, tort, strict liability, other Laws or otherwise.

 

17


(b) NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, NO PARTY SHALL BE LIABLE FOR SPECIAL, PUNITIVE, EXEMPLARY, INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES, LOST PROFITS, LOST OPPORTUNITIES OR OTHER SPECULATIVE DAMAGES, WHETHER BASED ON CONTRACT, TORT, STRICT LIABILITY, OTHER LAW OR OTHERWISE AND WHETHER OR NOT ARISING FROM ANY OTHER PARTY’S SOLE, JOINT OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT; PROVIDED, HOWEVER, THAT THIS Section  8.7(b) SHALL NOT LIMIT A PARTY’S RIGHT TO RECOVERY UNDER Article VIII FOR ANY SUCH DAMAGES TO THE EXTENT SUCH PARTY IS REQUIRED TO PAY SUCH DAMAGES TO A THIRD PARTY IN CONNECTION WITH A MATTER FOR WHICH SUCH PARTY IS OTHERWISE ENTITLED TO INDEMNIFICATION UNDER Article VIII .

ARTICLE IX

TERMINATION

Section  9.1 Termination . At any time prior to the Closing, this Agreement may be terminated and the transactions contemplated hereby abandoned:

(a) by the mutual consent of the Partnership and PBF Energy as evidenced in writing signed by each of the Partnership and PBF Energy;

(b) by either of the Partnership or PBF Energy if any Governmental Authority having competent jurisdiction has issued a final, non-appealable order, decree, ruling or injunction (other than a temporary restraining order) or taken any other action permanently restraining, enjoining or otherwise prohibiting the transactions contemplated by this Agreement; or

(c) by either the Partnership or PBF Energy, if the Closing has not occurred on or before June 30, 2019 or such later date as the Parties may agree upon.

Section 9.2 Effect of Termination . In the event of termination and abandonment of this Agreement pursuant to Section  9.1 , this Agreement shall forthwith become void and have no effect without any liability on the part of any Party hereto other than for any prior breaches, as to which the Parties will remain liable and/or to which the other Party shall be entitled to all rights and remedies available under Law or equity. The provisions of this Section  9.2 and Section  10.4 shall survive any termination of this Agreement.

ARTICLE X

MISCELLANEOUS

Section  10.1 Notices . Any notice, request, demand and other communication required or permitted to be given hereunder shall be in writing, and may be served by personal delivery, facsimile or by depositing same in the mail, addressed to the Party to be notified, first class, postage prepaid, and registered or certified with a return receipt requested. Notice deposited in the mail in the manner hereinabove described shall be deemed to have been given and received on the date of the delivery as shown on the return receipt. Notice served in any other manner shall be deemed to have been given and received only if and when actually received by the addressee (except that notice given by facsimile shall be deemed given and received upon receipt only if received during normal business hours and, if received other than during normal business hours, shall be deemed received as of the opening of business on the next Business Day). For purposes of notice, the addresses of the Parties shall be as follows:

 

18


                                                                   (a)    If to the Partnership, to:
       PBF Logistics LP
       One Sylvan Way, Second Floor
       Parsippany, New Jersey 07054
       Attention: Matthew Lucey
       Facsimile: (973) 455-7562
       With copies to:
       PBF Logistics LP
       One Sylvan Way, Second Floor
       Parsippany, New Jersey 07054
      

Attention: David Roush, Chairman of the Conflicts Committee of the

                 Board of Directors of PBF Logistics GP LLC

       Facsimile: (973) 455-7562
    (b)    If to PBF Energy, to:
       PBF Energy Company LLC
       One Sylvan Way, Second Floor
       Parsippany, New Jersey 07054
       Attention: Erik Young
       Facsimile: (973) 455-7562
       with copies to:
       PBF Energy Company LLC
       One Sylvan Way, Second Floor
       Parsippany, New Jersey 07054
       Attention: Trecia Canty
       Facsimile: (973) 455-7562

or to such other address or addresses as the Parties may from time to time designate in writing.

Section  10.2 Assignment . No Party shall assign this Agreement or any part hereof without the prior written consent of the other Party; provided that the Partnership may assign its rights hereunder to PBFX Operating. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the Parties and their respective permitted successors and assigns.

Section 10.3 Rights of Third Parties . Except for the provisions of Section  8.2 which are intended to be enforceable by the Persons respectively referred to therein, nothing expressed or implied in this Agreement is intended or shall be construed to confer upon or give any Person, other than the Parties, any right or remedies under or by reason of this Agreement.

Section  10.4 Expense . Except as otherwise provided herein, each Party shall bear its own expenses incurred in connection with this Agreement and the transactions herein contemplated hereby whether or not such transactions shall be consummated, including all fees of its legal counsel, financial advisers and accountants.

Section  10.5 Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. An executed counterpart of a signature page of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have, for all purposes, the same legal effect as delivery of a manually executed counterpart.

 

19


Section  10.6 Entire Agreement . This Agreement (together with the schedules and exhibits to this Agreement) constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes any other agreements, whether written or oral, that may have been made or entered into by or among any of the Parties or any of their respective Affiliates relating to such subject matter.

Section  10.7 Amendments . This Agreement may be amended or modified in whole or in part, and terms and conditions may be waived, only by a duly authorized agreement in writing which makes reference to this Agreement executed by each Party.

Section  10.8 Publicity . All press releases or other public communications of any nature whatsoever relating to the transactions contemplated by this Agreement, and the method of the release for publication thereof, shall be subject to the prior consent of the Partnership and PBF Energy, which consent shall not be unreasonably withheld, conditioned or delayed by any Party; provided, however, that nothing herein shall prevent a Party from publishing such press releases or other public communications as such Party may consider necessary in order to satisfy such Party’s obligations at Law or under the rules of any stock or commodities exchange after consultation with the other Party as is reasonable under the circumstances.

Section  10.9 Severability . If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, then the other provisions of this Agreement shall remain in full force and effect. The Parties further agree that if any provision contained herein is, to any extent, held invalid or unenforceable in any respect under the Laws governing this Agreement, then they shall take any actions necessary to render the remaining provisions of this Agreement valid and enforceable to the fullest extent permitted by Law and, to the extent necessary, shall amend or otherwise modify this Agreement to replace any provision contained herein that is held invalid or unenforceable with a valid and enforceable provision giving effect to the intent of the Parties to the greatest extent legally permissible.

Section  10.10 Governing Law; Jurisdiction .

(a) This Agreement shall be governed and construed in accordance with the Laws of the State of Delaware without regard to the Laws that might be applicable under conflicts of laws principles.

(b) The Parties agree that the appropriate, exclusive and convenient forum for any disputes between any of the Parties hereto arising out of this Agreement or the transactions contemplated hereby shall be in any state or federal court in Delaware, and each of the Parties hereto irrevocably submits to the jurisdiction of such courts solely in respect of any legal proceeding arising out of or related to this Agreement. The Parties further agree that the Parties shall not bring suit with respect to any disputes arising out of this Agreement or the transactions contemplated hereby in any court or jurisdiction other than the above specified courts; provided, however , that the foregoing shall not limit the rights of the Parties to obtain execution of judgment in any other jurisdiction. The Parties further agree, to the extent permitted by Law, that a final and unappealable judgment against a Party in any action or proceeding contemplated above shall be conclusive and may be enforced in any other jurisdiction within or outside the United States by suit on the judgment, a certified or exemplified copy of which shall be conclusive evidence of the fact and amount of such judgment. Except to the extent that a different determination or finding is mandated due to the Law being that of a different jurisdiction, the Parties agree that all judicial determinations or findings by a state or federal court in Wilmington, Delaware with respect to any matter under this Agreement shall be binding.

 

20


(c) To the extent that any Party hereto has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, each such party hereby irrevocably (i) waives such immunity in respect of its obligations with respect to this Agreement and (ii) submits to the personal jurisdiction of any court described in Section  10.11(b) .

(d) THE PARTIES HERETO AGREE THAT THEY HEREBY IRREVOCABLY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION TO ENFORCE OR INTERPRET THE PROVISIONS OF THIS AGREEMENT.

Section  10.11 Action by the Partnership . With respect to any action (including any case where the agreement of, or selection by, the Partnership is required), notice, consent, approval or waiver that is required to be taken or given or that may be taken or given by the Partnership prior to the Closing Date with respect to, or in connection with, the subject matter hereof, such action, notice, consent, approval or waiver shall be taken or given by the Conflicts Committee on behalf of the Partnership.

[ Signature page follows .]

 

21


IN WITNESS WHEREOF, this Contribution Agreement has been duly executed and delivered by each Party as of the date first above written.

 

PBF Energy :
PBF ENERGY COMPANY LLC
By:  

/s/ Trecia Canty

Name: Trecia Canty
Title: Secretary
Partnership:
PBF LOGISTICS LP
By:   PBF LOGISTICS GP LLC,
  its general partner
By:  

/s/ Erik Young

Name: Erik Young
Title: Chief Financial Officer

[Signature Page to the Contribution Agreement]


EXHIBIT A

AMENDMENT NO. 1 TO THE SERVICE ORDERS

Exhibit 5.1

Kramer Levin Naftalis & Frankel LLP

1177 Avenue of the Americas

New York, NY 10036

 

April 24, 2019

PBF Logistics LP

One Sylvan Way, Second Floor

Parsippany, New Jersey 07054

 

Ladies and Gentlemen:

We have acted as counsel for PBF Logistics LP, a Delaware limited partnership (the “ Partnership ”), in connection with the offer and sale by the Partnership of an aggregate of 6,585,500 common units representing limited partner interests in the Partnership (the “ Units ”) in a registered direct offering pursuant to the shelf registration statement on Form S-3 (File No. 333-227366) (the “ Registration Statement ”) filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “ Securities Act ”). The Units are to be sold by the Partnership pursuant to those certain Subscription Agreements, dated as of April 24, 2019, by and between the Partnership and each purchaser of the Units named therein (the “ Subscription Agreements ”).

We have reviewed (i) the Registration Statement, (ii) the prospectus dated September 24, 2018 contained within the Registration Statement, (iii) the prospectus supplement dated April 24 , 2019 relating to the Units (the “Prospectus Supplement”), (iv) the Certificate of Limited Partnership of the Partnership, (v) the Third Amended and Restated Agreement of Limited Partnership of the Partnership dated as of February 13, 2019, as amended to date (the “Partnership Agreement”), (vi) copies of the formation, organizational and other governing documents of PBF Logistics GP LLC, a Delaware limited liability company and the general partner of the Partnership (the “General Partner”), (vii) resolutions of the General Partner (including any committees thereof), (viii) the Subscription Agreements and (ix) such other certificates, statutes, including the Delaware Revised Uniform Limited Partnership Act (the “Delaware LP Act”) and the Delaware Limited Liability Company Act, and other instruments and documents as we have deemed necessary or appropriate for purposes of the opinions hereafter expressed. We also have examined the originals, or duplicates or certified or conformed copies, of such partnership and other records, agreements, documents and other instruments and have made such other investigations as we have deemed relevant and necessary in connection with the opinions hereinafter set forth. As to questions of fact material to this opinion, we have relied upon certificates or comparable documents of public officials and of officers of the General Partner. We have not independently verified the facts so relied on.

In rendering the opinion set forth below, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as duplicates or certified or conformed copies and the authenticity of the originals of such latter documents.

Based upon the foregoing, and subject to the qualifications, limitations and assumptions set forth herein, we are of the opinion that the Units will, when issued and delivered against payment therefor in accordance with the Subscription Agreements and the Prospectus Supplement, will be duly authorized, validly issued and purchasers of the Units will have no obligation under the Delaware LP Act, the Partnership’s governing documents or any

 

Page 1 of 2


resolution or other action taken under the Partnership’s governing documents, to make further payments for their purchase of Units or contributions to the Partnership solely by reason of their ownership of Units or their status as limited partners of the Partnership, and no personal liability for the debts, obligations and liabilities of the Partnership, whether arising in contract, tort or otherwise, solely by reason of being limited partners of the Partnership.

Attorneys involved in the preparation of this opinion are admitted to practice law in the State of New York and we do not purport to be experts on, or express any opinion herein concerning, any law other than the laws of the State of New York, the federal Laws of the United States of America, the Delaware LP Act and the Delaware Limited Liability Company Act.

We hereby consent to the filing of this opinion as Exhibit 5.1 to a Current Report on Form 8-K and to the use of our name under the caption “Legal Matters” in the Prospectus Supplement. In giving this consent, we do not hereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations promulgated thereunder.

 

Very truly yours,

 

/s/ Kramer Levin Naftalis & Frankel LLP

 

KRAMER LEVIN NAFTALIS & FRANKEL LLP

 

Page 2 of 2

EXHIBIT 8.1

 

LOGO   

Hunton Andrews Kurth LLP

600 Travis, Suite 4200

Houston, Texas 77002

+1.713.220.4200 Phone

+1.713.220.4285 Fax

HuntonAK.com

 

April 24, 2019

PBF Logistics LP

One Sylvan Way, Second Floor

Parsippany, New Jersey 07054

Ladies and Gentlemen:

We have acted as special counsel to PBF Logistics LP, a Delaware limited partnership (the “ Partnership ”), in connection with the preparation of a prospectus supplement dated on or about the date hereof (“ Prospectus Supplement ”) and the prospectus forming part of the registration statement on Form S-3 (No. 333-227366) (the “ Registration Statement ”) filed by the Partnership with the Securities and Exchange Commission (the “ Commission ”) and declared effective on September 24, 2018, relating to the registration of the offering and sale (the “ Offering ”) of common units representing limited partner interests in the Partnership (the “Units”), under the Securities Act of 1933, as amended (the “ Act ”). In connection therewith, we have participated in the preparation of the discussion set forth under the heading “Material U.S. Federal Income Tax Consequences” in the Registration Statement as updated in the Prospectus Supplement under the heading “Material U.S. Federal Income Tax Consequences” (the “ Discussion ”).

This opinion is based on various facts and assumptions, and is conditioned upon certain representations made to us by the Partnership as to factual matters through an officer’s certificate (the “ Officer’s Certificate ”). In addition, this opinion is based upon the factual representations of the Partnership concerning its business, properties and governing documents as set forth in the Registration Statement and the Partnership’s responses to our examinations and inquiries.

In our capacity as counsel to the Partnership, we have made such legal and factual examinations and inquiries, including an examination of originals or copies certified or otherwise identified to our satisfaction of such documents, corporate records and other instruments, as we have deemed necessary or appropriate for purposes of this opinion. In our examination, we have assumed the authenticity of all documents submitted to us as originals, the genuineness of all signatures thereon, the legal capacity of natural persons executing such documents and the conformity to authentic original documents of all documents submitted to us as copies. For the purpose of our opinion, we have not made an independent investigation or audit of the facts set forth in the above-referenced documents or representations. In addition, in rendering this opinion we have assumed the truth and accuracy of all representations and statements made to us which are qualified as to knowledge or belief, without regard to such qualification.

ATLANTA AUSTIN BANGKOK BEIJING BOSTON BRUSSELS CHARLOTTE DALLAS DUBAI HOUSTON LONDON LOS ANGELES MIAMI NEW YORK NORFOLK RALEIGH/DURHAM RICHMOND SAN FRANCISCO THE WOODLANDS TYSONS WASHINGTON, DC


April 24, 2019

Page 2

We hereby confirm that all statements of legal conclusion contained in the Discussion, subject to the qualifications and assumptions stated in the Discussion and the limitations and qualifications set forth herein, constitute the opinion of Hunton Andrews Kurth LLP with respect to the matters set forth therein. This opinion is based on various statutory provisions, regulations promulgated thereunder and interpretations thereof by the Internal Revenue Service and the courts having jurisdiction over such matters, all of which are subject to change either prospectively or retroactively. Also, any variation or difference in the facts from those set forth in the representations described above, including in the Registration Statement and the Officer’s Certificate, may affect the conclusions stated herein.

This opinion letter is limited to the matters set forth herein, and no opinions are intended to be implied or may be inferred beyond those expressly stated herein. Our opinion is rendered as of the date hereof and we assume no obligation to update or supplement this opinion or any matter related to this opinion to reflect any change of fact, circumstances, or law after the date hereof. In addition, our opinion is based on the assumption that the matter will be properly presented to the applicable court.

Furthermore, our opinion is not binding on the Internal Revenue Service or a court. In addition, we must note that our opinion represents merely our best legal judgment on the matters presented and that others may disagree with our conclusion. There can be no assurance that the Internal Revenue Service will not take a contrary position or that a court would agree with our opinion if litigated.

We hereby consent to the filing of this opinion as an exhibit to a Current Report on Form 8-K of the Partnership filed on or about the date hereof and to the references to our firm and this opinion contained in the Discussion. In giving this consent, we do not thereby admit that we are included in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission relating thereto, with respect to any part of the Registration Statement, including this exhibit to the Current Report on Form 8-K.

 

Very truly yours,
  /s/ Hunton Andrews Kurth LLP

Exhibit 99.1

 

LOGO

PBF Logistics Announces Acquisition of Remaining 50% Interest in Torrance Valley Pipeline Company and

Provides First Quarter Interim Update

PARSIPPANY, NJ – April 24, 2019 – PBF Logistics LP (NYSE:PBFX) (the “Partnership” or “PBF Logistics”) announced today the execution of definitive agreements for the acquisition of the remaining fifty percent interest in Torrance Valley Pipeline Company LLC (“TVPC”) from an affiliate of PBF Energy Inc. (NYSE:PBF) for total consideration of approximately $200 million in cash. The Partnership and PBF Energy currently anticipate closing of the transaction to occur in the second quarter, subject to customary closing conditions. The acquisition is expected to be financed through a combination of $135 million of gross proceeds from PBFX’s over-subscribed registered direct offering of common units to certain institutional investors announced today and a $65 million draw-down from the Partnership’s senior secured revolving credit facility.

The acquisition of TVPC by the Partnership immediately doubles its position in one of its core assets and is immediately accretive to distributable cash flow. Pro forma for the transaction, the Partnership expects 2019 coverage to be consistent with its original guidance of approximately 1.05x based on current expectations. The Partnership reiterates its prior guidance of maintaining leverage in the three-to-four times run-rate EBITDA range and its commitment to a long-term coverage ratio of 1.15x.

PBFX and PBF Energy Chief Executive Officer Thomas Nimbley said, “The acquisition of the remaining 50 percent interest in TVPC reflects PBFX’s ongoing commitment to deliver sustained growth to our unitholders by adding high-quality assets to our earnings base. The equity issuance and drop-down transaction were executed in response to high investor demand for investable opportunities in PBF Logistics.” Mr. Nimbley continued, “With this transaction, in combination with our organic growth efforts, we exceed our near-term distribution growth funding requirements and achieve the flexibility to execute our strategic plan without accessing public equity to fund growth capital through 2020.”

About the TVPC Transaction

TVPC owns the 189-mile San Joaquin Valley Pipeline system with a throughput capacity of approximately 110,000 barrels per day. The system is comprised of the M55, M1 and M70 pipelines which are the primary crude gathering and transportation lines that supply PBF Energy’s Torrance refinery. The assets also include 11 pipeline stations with approximately one million barrels of combined storage capacity and truck unloading capability at two of the stations.

Pursuant to the agreement, upon closing, the Partnership would consolidate the existing ten-year term transportation services agreements with subsidiaries of PBF Energy containing minimum volume throughput commitments (“MVCs”) of approximately 50,000 barrels per day for the M1 and M55 pipelines; increased MVCs of approximately 75,000 barrels per day for the M70 pipeline, from current MVCs of 70,000 bpd, and for storage capacity at certain tanks representing approximately 50 percent of the total available shell capacity of the storage facilities. Based on the TVPC ownership interest to be acquired, current cost structure, increased fees payable by PBF Energy under the amended M70 services agreement and the expected minimum throughput rates, the newly-acquired interests of TVPC would be expected to generate, on an annualized run-rate basis subsequent to closing the proposed acquisition, estimated annual net income of approximately $15.5 million based on revenues of approximately $44.0 million and estimated earnings before interest, taxes, depreciation and amortization (“EBITDA”) of approximately $25.0 million. Annual maintenance capital expenditures for the Partnership’s acquired interest would be expected to average approximately $1.5 million.


The terms of the potential transaction have been approved by the Conflicts Committee of the Board of Directors of the general partner of PBF Logistics. The Conflicts Committee is composed of independent directors and was advised by Piper, Jaffray & Co., its financial advisor, and Baker Botts LLP, its legal counsel.

First Quarter Interim Update

The preliminary financial data discussed below has been prepared by, and is the responsibility of, our management and has not been audited or reviewed by our independent registered public accounting firm. We have provided a range for our current preliminary unaudited estimates of revenue, net income, EBITDA and EBITDA attributable to PBFX discussed below because our financial closing procedures for the first quarter of fiscal year 2019 are not yet complete and are subject to final adjustments and other developments that may arise between now and the time the financial results for the first quarter of fiscal year 2019 are finalized.

The preliminary first quarter estimates are based upon assumptions we believe to be reasonable but include information from third parties that is subject to further review and verification. It is possible that our final reported results may not be within the ranges we currently estimate, and the difference may be material. We expect to report financial results related to the quarter ended March 31, 2019 on or about May 1, 2019.

The following are our current preliminary estimates for the three month period ended March 31, 2019:

 

   

Revenue of between $78.3 million and $79.3 million;

 

   

Net income of between $21.6 million and $22.6 million;

 

   

EBITDA of between $42.4 million and $43.4 million (see below for a reconciliation of net income to EBITDA);

 

   

EBITDA attributable to PBFX of between $36.3 million and $37.3 million (see below for a reconciliation of net income to EBITDA attributable to PBFX);

 

   

Included in results for the first quarter are $6.1 million of transaction costs, unit-based compensation and non-recurring charges negatively impacting net income and EBITDA and EBITDA attributable to PBFX comprised of transaction-related expenses primarily associated with the IDR simplification transaction, unit-based compensation, environmental remediation costs associated with our East Coast Terminals and a true-up for revenue associated with the Paulsboro Natural Gas Pipeline due to a reduction in its pipeline tariff based on the lower than budget project costs; and

 

   

Adjusted EBITDA of between $42.4 million and $43.4 million, after adding back $6.1 million of transaction, unit-based compensation and non-recurring charges.

As of March 31, 2019, the Partnership had approximately $352 million of liquidity, including approximately $16 million in cash and cash equivalents, and access to approximately $336 million under its revolving credit facility.

Non-GAAP Measures

The Partnership defines EBITDA as net income (loss) before net interest expense including amortization of loan fees and debt premium and accretion on discounted liabilities, income tax expense, depreciation and amortization expense. The Partnership defines EBITDA attributable to PBFX as net income (loss) attributable to PBFX before net interest expense including amortization of loan fees and debt premium and accretion on discounted liabilities, income tax expense, depreciation and amortization expense attributable to PBFX, which excludes results of acquisitions from affiliates of PBF Energy prior to the effective dates of such transactions. The Partnership defines Adjusted EBITDA as EBITDA attributable to PBFX excluding acquisition and transaction costs, unit-based compensation and items that meet the conditions of unusual, infrequent and/or non-recurring charges. EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA are supplemental measures of performance that are not required by or presented in accordance with U.S. generally accepted accounting principles (“GAAP”). We use these non-GAAP financial measure as a supplement to our GAAP results in order to provide a more complete understanding of the factors and trends affecting our business and to assist in evaluating our ongoing operating performance for the current reporting period in comparison to other reporting periods. EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA are measures of operating performance that are not defined by GAAP and should not be considered a substitute for net income, operating income or any other measure of financial performance in accordance with GAAP.


Also, because EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA are not calculated in the same manner by all companies, they are not necessarily comparable to other similarly titled measures used by other companies. EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA have their limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. Some of the limitations of EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA are:

 

   

they do not reflect depreciation expense or our cash expenditures, or future requirements, for capital expenditures or contractual commitments;

 

   

they do not reflect changes in, or cash requirements for, our working capital needs;

 

   

they do not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our debt; and

 

   

they do not reflect transaction costs, unit-based compensation and non-recurring charges incurred during the period.

PBF Logistics LP Reconciliation of Amounts (unaudited, millions)

Reconciliation of preliminary first quarter net income to EBITDA, EBITDA attributable to PBFX and Adjusted EBITDA:

 

     Three Months Ended  
     March 31, 2019  
     Range  
     Low      High  

Net income

   $ 21.6      $ 22.6  

Add: Depreciation and amortization expense

     8.7        8.7  

Add: Interest expense, net and other financing costs

     12.1        12.1  
  

 

 

    

 

 

 

EBITDA

     42.4        43.4  

Less: Noncontrolling interest EBITDA

     6.1        6.1  
  

 

 

    

 

 

 

EBITDA attributable to PBFX

     36.3        37.3  

Add: Transaction, unit-based compensation and non-recurring charges

     6.1        6.1  
  

 

 

    

 

 

 

Adjusted EBITDA

   $ 42.4      $ 43.4  
  

 

 

    

 

 

 

Reconciliation of fifty percent TVPC acquired interest, inclusive of the amendment to the M70 services agreement, estimated annualized run-rate Net Income to annualized run-rate EBITDA:

 

Annualized run-rate net income

   $ 15.5  

Add: Depreciation and amortization expense

     5.5  

Add: Interest expense, net and other financing costs

     4.0  
  

 

 

 

Annualized run-rate EBITDA

   $ 25.0  
  

 

 

 

Due to the forward-looking nature of annualized run-rate EBITDA, information to reconcile annualized run-rate EBITDA to annualized run-rate cash flow from operating activities is not available as management is unable to project working capital changes for future periods at this time.

Due to the forward-looking nature of forecasted and long-term, consolidated run-rate EBITDA and distributable cash flow, information to reconcile long-term, consolidated run-rate EBITDA, distributable cash flow and coverage ratios to long-term, consolidated run-rate net income and cash flow from operating activities is not available as management is unable to project financing terms and working capital changes for future periods at this time.


About PBF Logistics LP

PBF Logistics LP (NYSE: PBFX), headquartered in Parsippany, New Jersey, is a fee-based, growth-oriented master limited partnership formed by PBF Energy to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets.

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 accretion expected to be realized by the Partnership as a result of the acquisition, the information under “First Quarter Interim Update” and the expectations of plans, strategies, objectives and growth and anticipated financial and operational performance of the Partnership and its subsidiaries. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Partnership, 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, including those set forth in reports filed by the Partnership with the Securities and Exchange Commission. Any forward-looking statement applies only as of the date on which such statement is made and the Partnership does 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:

Colin Murray (investors)

ir@pbfenergy.com

Tel: 973.455.7578

Michael C. Karlovich (media)

mediarelations@pbfenergy.com

Tel: 973.455.8994

Exhibit 99.2

 

LOGO

PBF Logistics Announces Registered Direct Offering of 6,585,500 Common Units

PARSIPPANY, NJ – April 24, 2019 – PBF Logistics LP (NYSE: PBFX, the “Partnership”), a master limited partnership formed by PBF Energy Inc., announced that it has entered into definitive subscription agreements with certain institutional investors, pursuant to which the Partnership will sell an aggregate of 6,585,500 common units directly to such institutional investors in a registered direct offering for gross proceeds of approximately $135.0 million. The offering is expected to close on April 29, 2019, subject to customary closing conditions.

The Partnership plans to use the net proceeds from this offering, after placement fees and other estimated offering expenses, to fund a portion of the purchase price for its acquisition from an affiliate of PBF Energy Inc. of the remaining 50 percent interest in the Torrance Valley Pipeline Company LLC that it does not currently own. If the Partnership does not consummate such transaction, the Partnership intends to use the net proceeds from this offering for general partnership purposes, which may include reducing indebtedness outstanding under its revolving credit facility. The offering is not conditioned on the closing of the acquisition.

RBC Capital Markets, LLC acted as the placement agent for the transaction.

The offering was made pursuant to an effective shelf registration statement that was previously filed with the Securities and Exchange Commission (“SEC”). This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, any of the securities described herein, nor shall there be any sale of these securities, in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. The offering is being made only by means of a prospectus and related prospectus supplement meeting the requirements of Section 10 of the Securities Act of 1933, as amended, copies of which may be obtained at the SEC’s website at http:// www.sec.gov . Copies of the prospectus supplement and accompanying prospectus may also be obtained from RBC Capital Markets, LLC, Attention: Equity Syndicate, 200 Vesey Street, 8th Floor, New York, NY 10281-8098, by telephone toll-free at (877) 822-4098, or by e-mail to equityprospectus@rbccm.com .

Forward-Looking Statements

This press release contains forward-looking statements (as that term is defined under the federal securities laws) made by the Partnership and its management. Such statements are based on current expectations, forecasts and projections, including, but not limited to, anticipated financial and operating results, plans, objectives, expectations and intentions that are not historical in nature. Forward-looking statements should not be read as a guarantee of future performance or results, and may not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved. Forward-looking statements are based on information available at the time, and are subject to various risks and uncertainties, including risks relating to the securities markets generally, the impact of adverse


market conditions impacting the Partnership’s logistics and other assets, the possibility that the Partnership may not consummate the proposed acquisition, the Partnership’s plans for financing the proposed acquisition, and other risks inherent in the Partnership’s business. For more information concerning factors that could cause actual results to differ from those expressed or forecasted, see the Partnership’s filings with the Securities and Exchange Commission including its most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q. Forward-looking statements reflect information, facts and circumstances only as of the date they are made. The Partnership assumes no responsibility or obligation to update forward-looking statements except as may be required by law.

PBF Logistics LP

PBF Logistics LP, headquartered in Parsippany, New Jersey, is a fee-based, growth-oriented master limited partnership formed by PBF Energy Inc. to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets.

Contacts:

For PBF Logistics LP

Investors:

Colin Murray, 973-455-7578

ir@pbfenergy.com

or

Media:

Michael C. Karlovich, 973-455-8994

mediarelations@pbfenergy.com

 

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