Article 2.01. Completion of acquisition or disposal of assets.
(as well as certain affiliates, “Oryx”), a holding company of
The joint venture includes all of the assets of the Permian Oryx Basin and, with the exception of PAA’s long-haul pipeline networks and some of its intra-basin terminal assets, the vast majority of PAA’s assets located in the Permian Basin. Specifically, Oryx’s assets in the joint venture include approximately 1,600 miles of pipeline and related operational storage capacity, in addition to long-term marketing and acreage agreements covering approximately 1.3 million. acres. The AAP assets in the joint venture include approximately 3,900 miles of pipeline and associated operational storage capacity, long-term marketing and acreage agreements covering approximately 2.8 million acres, as well as as supply and installation assignments. On a combined basis, the assets of the joint venture will include approximately 5,500 miles of pipeline representing approximately 6.8 million barrels per day of multi-segment pipeline network capacity, approximately 4.1 million acres of dedicated network, including including dedicated supplies and facilities, and direct downstream connections to all major intra-basin and downstream markets.
As part of the formation of the joint venture, PAA and Oryx entered into an LLC agreement, the main terms of which are as follows:
o Ownership and governance. Subject to the modified multi-level sharing arrangement
described below, the joint venture is 65% owned by PAA and 35% owned by Oryx. The
The joint venture is managed by a board of directors of five members including three PAAs
representatives and two Oryx representatives. PAA serves as the operator of
Joint Venture, and a joint operating committee which includes representatives
of PAA and Oryx will oversee the significant activities of the joint venture
and business decisions. The joint venture will be consolidated in the PAA
o Distribution. Quarterly distributions of available cash (cash at end of
of a quarter less reserves) of the Joint Venture to PAA and Oryx are subject to
a modified multi-level sharing agreement (“MSA”) for a maximum of 10 years. Under the
MSA, the distributions will be broken down as follows:
Available Cash Distribution Percentages Tier (Annualized) PAA Oryx 1 Up to $300mm 50 % 50 % 2 $300mm - $428mm 100 % 0 % 3 $428mm - $815mm 65 % 35 % 4 $815mm and above 70 % 30 %
Upon termination of the MSA, quarterly distributions of available cash will be paid 65% to PAA and 35% to Oryx.
o Area of mutual interest. Members of the joint venture and their affiliates (other than
Stonepeak and its non-Oryx holding companies) will be limited by
develop, acquire or own assets related to collection and marketing
crude oil and condensate in the Permian Basin, subject to certain exceptions.
o Future downstream projects. For a period of seven years after closing, the
The joint venture will have certain limited investment rights with respect to
important downstream projects pursued by one or other of the members.
o Transfer of interest and related provisions. In general, each joint venture
member will be free to transfer all, but not less than all, of his
interest in the joint venture; however, in certain circumstances and subject to
to certain limitations, (1) if Oryx wishes to transfer its interest, is
subject to foreclosure authorized by certain lenders or should be
subject to a change of control, PAA will have the right to make an offer
and negotiate to acquire the stake in Oryx, and (2) if PAA wishes to transfer
interest or undergo a change of control, Oryx will dispose of certain
The foregoing description of the Merger Agreement and LLC Agreement is qualified in its entirety by reference to that Merger Agreement and Schedule C-1 thereof, copies of which are incorporated herein by reference. in Annex 2.1 of the current PAGP report on Form 8-K filed on
1 Stonepeak affiliates own approximately 8.9% of the outstanding PAA Series A Preferred Units, which is equivalent to less than 1% of the outstanding PAA common units and common unit equivalents combined.
Article 7.01 Regulation FD Disclosure.
In accordance with Policy Statement B.2 of Form 8-K, the information presented herein in Item 7.01 will not be deemed to be “filed” for the purposes of section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the responsibilities of this section, nor will such information be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, each as amended.
Item 9.01 Financial statements and supporting documents.
(a) Financial statements of the acquired business.
The financial statements of the acquiree are not included in this Form 8-K report. These financial statements will be filed within 71 calendar days of the filing date of this Form 8-K report.
(b) Pro Forma Financial Information.
Pro forma financial information relating to the acquired business is not included in this Form 8-K report. This pro forma financial information will be filed within 71 calendar days of the filing date of this Form 8-K report.
(d) Exhibits Exhibit Description Number 2.1 Agreement and Plan of Merger dated as of
July 12, 2021by and among Plains Pipeline, L.P., Plains Marketing, L.P., Oryx Midstream Holdings LLC, Middle Cadence Holdings LLC, POP HoldCo LLC, Oryx Wink Oil Marketing LLC, Oryx Permian Oil Marketing LLC, Plains Oryx Permian Basin LLC, Plains Oryx Permian Basin Marketing LLCand Plains Oryx Permian Basin Pipeline LLC(incorporated by reference to Exhibit 2.1 to PAGP's Current Report on Form 8-K filed on July 13, 2021). 99.1 Press Release Dated October 5, 2021. 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
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