PBF Energy 2013 Annual Report Download - page 129

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- 33
Advances under the Revolving Loan cannot exceed the lesser of $1,610,000 or the Borrowing Base, as defined in
the agreement. The Revolving Loan can be prepaid, without penalty, at any time. Interest on the Revolving Loan
is payable quarterly in arrears, at the option of PBF Holding, either at the Alternate Base Rate plus the Applicable
Margin, or at the Adjusted LIBOR Rate plus the Applicable Margin, all as defined in the agreement. PBF Holding
is required to pay a LC Participation Fee, as defined in the agreement on each outstanding letter of credit issued
under the Revolving Loan equal to the Applicable Margin applied to Adjusted LIBOR Rate Loans, plus a Fronting
Fee equal to 0.125%.
The Revolving Loan has a financial covenant which requires that at any time Excess Availability, as defined in the
agreement, is less than the greater of (i) 17.5% of the lesser of the Borrowing Base and the aggregate Revolving
Commitments of the Lenders, or (ii) $35,000, PBF Holding will not permit the Consolidated Fixed Charge Coverage
Ratio, as defined in the agreement, determined as of the last day of the most recently completed quarter, to be less
than 1.1 to 1.0. PBF Holding was in compliance with this covenant as of December 31, 2013.
All obligations under the Revolving Loan are guaranteed (solely on a limited recourse basis) to the extent required
to support the lien described in clause (y) below by PBF LLC, PBF Finance, and each of our domestic operating
subsidiaries and secured by a lien on (y) PBF LLC’s equity interests in PBF Holding and (z) substantially all of
the assets of PBF Holding and the subsidiary guarantors (subject to certain exceptions). The lien of the Revolving
Loan is secured by: all deposit accounts (other than zero balance accounts, cash collateral accounts, trust accounts
and/or payroll accounts, all of which are excluded from the collateral); all accounts receivables; all hydrocarbon
inventory (other than the Saudi crude oil pledged under the letter of credit facility); to the extent evidencing,
governing, securing or otherwise related to the foregoing, all general intangibles, chattel paper, instruments,
documents, letter of credit rights and supporting obligations; and all products and proceeds of the foregoing.
At December 31, 2013, PBF Holding had $15,000 outstanding loans and standby letters of credit of $441,368
issued under the Revolving Loan. At December 31, 2012, PBF Holding had no outstanding loans of and standby
letters of credit of $449,652 issued under the Revolving Loan.
Senior Secured Notes
On February 9, 2012, PBF Holding completed the offering of $675,000 aggregate principal amount of 8.25%
Senior Secured Notes due 2020. The net proceeds, after deducting the original issue discount, the initial purchasers’
discounts and commissions, and the fees and expenses of the offering, were used to repay all of the outstanding
indebtedness plus accrued interest owed under the Toledo Promissory Note, the Paulsboro Promissory Note, and
the Term Loan, as well as to reduce the outstanding balance of the Revolving Loan. The Company’s Executive
Chairman of the Board of Directors, and certain of his affiliates and family members, and certain of the Company’s
other executives, purchased $25,500 aggregate principal amount of these Senior Secured Notes in connection with
the offering which were subsequently sold to third parties in 2013.
The Senior Secured Notes are secured on a first-priority basis by substantially all of the present and future assets
of PBF Holding and its subsidiaries (other than assets securing the Revolving Loan). Payment of the Senior Secured
Notes is jointly and severally guaranteed by all of PBF Holding’s subsidiaries. PBF Holding has optional redemption
rights to repurchase all or a portion of the Senior Secured Notes at varying prices no less than 100% of the principal
amounts of the notes plus accrued and unpaid interest. The holders of the Senior Secured Notes have repurchase
options exercisable only upon a change in control, certain asset sale transactions, or in event of a default as defined
in the indenture agreement. In addition, the Senior Secured Notes contain covenant restrictions limiting certain
types of additional debt, equity issuances, and payments. PBF Holding is in compliance with the covenants as of
December 31, 2013.
Delaware City Construction Financing
In October 2010, subsidiaries of the Company entered into a project management and financing agreement for a
capital project at the Delaware City refinery. On August 5, 2011 the Delaware City construction advances in the
amount of $20,000 were converted to a term financing payable in equal monthly installments of $530 over a period