Sunoco 2014 Annual Report Download - page 54

52
Capital Resources
Credit Facilities
In November 2013, we replaced our existing $550 million of credit facilities with a new $1.50 billion Credit Facility. The
$1.50 billion Credit Facility, which matures in November 2018, includes an "accordion" feature, under which the total aggregate
commitment may be extended to $2.25 billion under certain circumstances. The facility is available to fund our working capital
requirements, finance acquisitions and capital projects, to pay distributions and for general partnership purposes. The facility
contains various covenants, including limitations on the creation of indebtedness and liens, and other covenants related to the
operation and conduct of our business. The credit facility also limits us, on a rolling four-quarter basis, to a maximum total
consolidated debt to consolidated Adjusted EBITDA ratio, as defined in the underlying credit agreement, of 5.0 to 1, which can
generally be increased to 5.5 to 1 during an acquisition period. Our ratio of total consolidated debt, excluding net unamortized
fair value adjustments, to consolidated Adjusted EBITDA was 3.7 to 1 at December 31, 2014, as calculated in accordance with
the credit agreement.
West Texas Gulf maintains a $35 million revolving credit facility (the "$35 million Credit Facility") which expires in April
2015. The facility is available to fund West Texas Gulf's general corporate purposes including working capital and capital
expenditures. The credit facility also limits West Texas Gulf, on a rolling four-quarter basis, to a minimum fixed charge coverage
ratio, as defined in the underlying credit agreement, of 1.00 to 1. In addition, the credit facility limits West Texas Gulf to a
maximum leverage ratio of 2.00 to 1. West Texas Gulf's fixed charge coverage ratio and leverage ratio were 1.67 to 1 and 0.85 to
1, respectively, at December 31, 2014. Outstanding borrowings under this credit facility were $35 million at December 31, 2014
and 2013, respectively.
Senior Notes
We had $175 million of 8.75 percent Senior Notes that matured and were repaid in February 2014 with borrowings under
the $1.50 billion Credit Facility.
In November 2014, we issued $800 million of 5.35 percent Senior Notes and $200 million of 4.25 percent Senior Notes
(the "2024 and 2045 Senior Notes"), due April 2024 and May 2045, respectively. The terms and conditions of the 2024 and 2045
Senior Notes are comparable to those under our existing senior notes.
In April 2014, we issued $300 million of 4.25 percent Senior Notes and $700 million of 5.30 percent Senior Notes (the
"2024 and 2044 Senior Notes"), due April 2024 and April 2044, respectively. The terms and conditions of the 2024 and 2044
Senior Notes are comparable to those under our other outstanding senior notes.
The net proceeds of $1.98 billion from the 2014 senior notes offerings were used to repay outstanding borrowings under
the $1.50 billion Credit Facility and for general partnership purposes
In January 2013, we issued $350 million of 3.45 percent Senior Notes and $350 million of 4.95 percent Senior Notes (the
"2023 and 2043 Senior Notes"), due January 2023 and January 2043, respectively. The terms and conditions of the 2023 and
2043 Senior Notes are comparable to those under our existing senior notes. The net proceeds of $691 million from the 2023 and
2043 Senior Notes were used to pay outstanding borrowings under the $350 and $200 million credit facilities and for general
partnership purposes.
Equity Offerings
In the first quarter 2014, we filed a registration statement establishing a $250 million ATM program. The program allows
us to issue common units directly to the public and raise capital in a timely and efficient manner to finance our growth capital
program, while supporting our investment grade credit ratings. In the third quarter 2014, we filed a registration statement which
will allow us to issue an additional $1.0 billion of common units under the ATM program. For the year ended December 31,
2014, we issued 10.3 million common units under the ATM program for net proceeds of $477 million.
In September 2014, we completed an overnight public offering of 7.7 million common units for net proceeds of $362
million. The net proceeds from this offering were used to repay outstanding borrowings under the $1.5 billion Credit Facility and
for general partnership purposes.
Cash Flows and Capital Expenditures
Operating Activities
Cash flows from operating activities are primarily driven by earnings, excluding the impact of non-cash items; the timing
of cash receipts and disbursements related to accounts receivable and payable; and the timing of inventory transactions and
changes in other working capital amounts. Non-cash items include depreciation and amortization expense, compensation