Sunoco 2012 Annual Report Download - page 56

In connection with the acquisition of Sunoco by ETP in October 2012, Sunoco’s interests in the general
partner and limited partnership were contributed to ETP, resulting in a change of control of the Partnership’s
general partner. This would have represented an event of default under the Partnership’s credit facilities as the
general partner interest would no longer be owned by Sunoco. During the third quarter 2012, the Partnership
amended this provision of its credit facilities to avoid an event of default upon the transfer of the general partner
interest to ETP.
In May 2012, West Texas Gulf entered into 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. The ratio for the fiscal quarter ending December 31, 2012 shall not be less than 1.00 to 1. The
minimum ratio fluctuates between 0.80 to 1 and 1.00 to 1 throughout the term of the revolver as specified in the
credit agreement. 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 1.29 to 1 and 0.62 to 1, respectively, at
December 31, 2012. Outstanding borrowings under this credit facility were $20 million at December 31, 2012.
Promissory Note, Affiliated Companies
In July 2010, the Operating Partnership entered into a subordinated $100 million variable rate promissory
note due to Sunoco in May 2013 to fund a portion of the purchase price of our July 2010 acquisition of the
butane blending business discussed earlier. The note was repaid in full during the fourth quarter 2011.
Senior Notes
The Operating Partnership had $250 million of 7.25 percent Senior Notes which matured and were repaid in
February 2012.
In January 2013, the Operating Partnership 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.
In July 2011, the Operating Partnership issued $300 million of 4.65 percent Senior Notes and $300 million
of 6.10 percent Senior Notes (the “2022 and 2042 Senior Notes”), due February 2022 and February 2042,
respectively. The net proceeds of $595 million from the 2022 and 2042 Senior Notes were used to pay down
outstanding borrowings under the prior credit facilities, which were used to fund the acquisitions of a controlling
financial interest in Inland and the Texon crude oil acquisition and marketing business, and for general
partnership purposes.
In February 2010, the Operating Partnership issued $250 million of 5.50 percent Senior Notes and
$250 million of 6.85 percent Senior Notes, due February 2020 and February 2040, respectively. The net proceeds
of $494 million from the 2020 and 2040 Senior Notes were used to repay the $201 million promissory note
issued in connection with the Partnership’s repurchase and exchange of its IDR interest, repay outstanding
borrowings under the prior credit facility and for general partnership purposes.
Equity Offerings
In July 2011, we issued 3.9 million Class A Units to Sunoco in connection with the acquisition of the Eagle
Point tank farm and related assets. The deferred distribution units were a new class of units that converted to
common units in July 2012. Prior to their conversion, the Class A units participated in the allocation of net
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