PBF Energy 2013 Annual Report Download - page 114

PBF ENERGY INC. AND
PBF HOLDING COMPANY LLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)
F- 18
IPO-Related Reorganization Transactions
Concurrent with completion of the IPO, PBF LLC’s limited liability company agreement was amended and restated,
among other things, to designate PBF Energy as the sole managing member of PBF LLC and to establish the PBF
LLC Series C Units which are held solely by PBF Energy. The PBF LLC Series A Units continue to be held by
parties other than PBF Energy (“the members of PBF LLC other than PBF Energy”). The PBF LLC Series C Units
rank on parity with the PBF LLC Series A Units as to distribution rights, voting rights and rights upon liquidation,
winding up or dissolution. Following the IPO, profits and losses of PBF LLC are allocated, and all distributions
generally will be made, pro rata to the holders of PBF LLC Series A Units and PBF LLC Series C Units. In addition,
the amended and restated limited liability company agreement of PBF LLC provides that any PBF LLC Series A
Units acquired by PBF Energy will automatically be reclassified as PBF LLC Series C Units in connection with
such acquisition.
As part of the IPO and reorganization transactions, each holder of PBF LLC Series A Units received one share of
PBF Energy Class B common stock. The holder of a share of Class B common stock receives no economic rights
but entitles the holder, without regard to the number of shares of Class B common stock held by such holder, to
one vote on matters presented to stockholders of PBF Energy for each PBF LLC Series A Unit held by such holder.
Holders of PBF Energy Class A common stock and Class B common stock vote together as a single class on all
matters presented to stockholders for their vote or approval, except as otherwise required by applicable law. In
connection with the IPO and related reorganization transactions, PBF Energy, PBF LLC and PBF LLC Series A
Unit holders also entered into an exchange agreement pursuant to which each of the existing members of PBF LLC
other than PBF Energy and other holders who acquire PBF LLC Series A Units upon the exercise of certain warrants
and options, will have the right to cause PBF LLC to exchange their PBF LLC Series A Units for shares of PBF
Energy Class A common stock on a one-for-one basis, subject to equitable adjustments for stock splits, stock
dividends and reclassifications. As of December 31, 2013, there were 57,201,674 PBF LLC Series A Units held
by parties other than PBF Energy which upon exercise of the right to exchange would exchange for 57,201,674
shares of PBF Energy Class A common stock. In addition, as of that date, there were options and warrants to acquire
909,499 PBF LLC Series A Units outstanding, that upon exercise, could be exchanged for 909,499 shares of PBF
Energy Class A common stock.
Initial Public Offering and Secondary Offering
On December 12, 2012, a registration statement filed with the U.S. Securities and Exchange Commission relating
to shares of Class A common stock of PBF Energy to be offered and sold in an initial public offering was declared
effective. On December 12, 2012, PBF Energy completed an IPO of 23,567,686 shares of Class A common stock
at a public offering price of $26.00 per share. The IPO closed on December 18, 2012.
PBF Energy used proceeds from the offering in the amount of $571,200 to purchase 21,967,686 PBF LLC Series
A Units from funds affiliated with The Blackstone Group L.P. and First Reserve Management, L.P., PBF LLC’s
financial sponsors, which were then reclassified as PBF LLC Series C Units. The remaining proceeds from the
initial public offering in the amount of $41,600 were used to acquire 1,600,000 newly-issued PBF LLC Series C
Units from PBF LLC. PBF LLC used the proceeds from the sale of the PBF LLC Series C Units to pay the expenses
of the IPO. There was no change in carrying value of PBF LLC’s assets and liabilities as a result of the IPO or the
IPO-related reorganization transactions.
Additionally, on June 12, 2013, Blackstone and First Reserve completed a public offering of 15,950,000 shares of
PBF Energy Class A common stock at a price of $27.00 per share, less underwriting discounts and commissions,
in a secondary public offering. All of the shares were sold by funds affiliated with Blackstone and First Reserve.
In connection with this offering, Blackstone and First Reserve exchanged 15,950,000 Series A Units of PBF LLC
for an equivalent number of shares of PBF Energy Class A common stock.
Noncontrolling Interest
As a result of the PBF Energy IPO and the related reorganization transactions on December 18, 2012, PBF Energy
became the sole managing member of, and had a controlling interest in, PBF LLC which represented 24.4% of the