Item 1.01 Entry into a Material Definitive Agreement.
September 2020 364-Day Revolving Credit Agreement
On September 8, 2020, Enterprise Products Operating LLC, a Texas limited
liability company ("EPO") and the operating subsidiary of Enterprise Products
Partners L.P., a Delaware limited partnership (the "Partnership"), entered into
a 364-Day Revolving Credit Agreement among EPO, as Borrower; Citibank, N.A. as
Administrative Agent; JPMorgan Chase Bank, N.A., Mizuho Bank, Ltd., MUFG Union
Bank, Ltd., Truist Bank and Wells Fargo Bank, National Association, as
Co-Syndication Agents; The Bank of Nova Scotia, Houston Branch, Barclays Bank
PLC, Royal Bank of Canada, Sumitomo Mitsui Banking Corp., and The
Toronto-Dominion Bank, New York Branch, as Co-Documentation Agents; and the
lenders party thereto (the "September 2020 364-Day Credit Agreement"). Under the
terms of the September 2020 364-Day Credit Agreement, EPO may borrow up to
$1.5 billion (which may be increased by up to $200 million to $1.7 billion at
EPO's election, provided certain conditions are met) at a variable interest rate
for a term of 364 days, subject to the terms and conditions set forth therein.
The September 2020 364-Day Credit Agreement replaces EPO's existing 364-Day
Revolving Credit Agreement, dated as of September 10, 2019 (which provided for
an aggregate borrowing capacity of $1.5 billion and had a maturity date of
September 8, 2020), among EPO, Citibank N.A., as Administrative Agent, and the
lenders party thereto. EPO may use the proceeds from loans under the September
2020 364-Day Credit Agreement for working capital, capital expenditures,
acquisitions and other company purposes.
EPO's obligations under the September 2020 364-Day Credit Agreement are not
secured by any collateral; however, they are guaranteed by the Partnership
pursuant to a Guaranty Agreement (the "September 2020 Guaranty Agreement").
Amounts borrowed under the September 2020 364-Day Credit Agreement mature on
September 7, 2021, although EPO may, between 15 and 60 days prior to the
maturity date, elect to have the entire principal balance then outstanding
continued as non-revolving term loans for a period of one additional year,
payable on September 7, 2022.
In addition to interest payments on outstanding borrowings, on a quarterly
basis, EPO is required to pay a facility fee on each lender's commitment
irrespective of commitment usage. The facility fee amount and the applicable
rate spread for loans under the September 2020 364-Day Credit Agreement will
vary based on EPO's senior debt credit rating.
The September 2020 364-Day Credit Agreement contains customary representations,
warranties, covenants (affirmative and negative) and events of default, the
occurrence of which would permit the lenders to accelerate the maturity date of
amounts borrowed under the September 2020 364-Day Credit Agreement. The
September 2020 364-Day Credit Agreement also restricts EPO's ability to pay cash
distributions to the Partnership if an event of default (as defined in the
September 2020 364-Day Credit Agreement) has occurred and is continuing at the
time such distribution is scheduled to be paid or would result therefrom.
The descriptions of the September 2020 364-Day Credit Agreement and the
September 2020 Guaranty Agreement in this Item 1.01 are qualified in their
entirety by reference to the full text of the September 2020 364-Day Credit
Agreement and the September 2020 Guaranty Agreement, which are filed as Exhibits
10.1 and 10.2 hereto, respectively, and incorporated herein by reference.
Item 1.02 Termination of a Material Definitive Agreement.
Termination of April 2020 364-Day Revolving Credit Agreement
As previously disclosed, in order to provide an incremental $1.0 billion of
borrowing capacity in addition to the aggregate borrowing capacity then
available under its existing credit agreements, on April 3, 2020 EPO entered
into a 364-Day Revolving Credit Agreement among EPO, as Borrower; Citibank, N.A.
as Administrative Agent; and the lenders party thereto (the "April 2020 364-Day
Credit Agreement"). The April 2020 364-Day Credit Agreement enhanced EPO's
financial flexibility during the economic downturn caused by the COVID-19
pandemic. Under the terms of the April 2020 364-Day Credit Agreement, EPO could
borrow up to $1.0 billion at a variable interest rate for a term of 364 days
(maturing on April 2, 2021), subject to the terms and conditions set forth
therein.
In August 2020, EPO issued $1.0 billion in principal amount of 3.20% senior
notes due February 2052 and $250.0 million in principal amount of 2.80% reopened
senior notes due January 2030. EPO received aggregate net proceeds of
$1.25 billion from the sale of such senior notes after deducting underwriting
discounts and other estimated offering expenses.
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Following the completion of the August 2020 senior notes offering and the
execution of the September 2020 364-Day Credit Agreement described in Item 1.01
above, EPO management concluded that the incremental borrowing capacity provided
by the April 2020 364-Day Credit Agreement is no longer needed; therefore, EPO
elected to terminate the April 2020 364-Day Credit Agreement effective as of
September 11, 2020.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
On September 8, 2020, EPO entered into the September 2020 364-Day Credit
Agreement. The information relating to the September 2020 364-Day Credit
Agreement and the related September 2020 Guaranty Agreement, as set forth under
Item 1.01, is incorporated by reference into this Item 2.03. The September 2020
364-Day Credit Agreement is filed as Exhibit 10.1 hereto, the September 2020
Guaranty Agreement is filed as Exhibit 10.2 hereto, and each is incorporated
herein by reference.
As of September 11, 2020, after giving effect to the transactions described in
Items 1.01 and 1.02 above, EPO has no borrowings outstanding under its revolving
credit facilities.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
10.1 364-Day Revolving Credit Agreement, dated as of September 8, 2020
among Enterprise Products Operating LLC, the Lenders party thereto,
and Citibank, N.A. as Administrative Agent.
10.2 Guaranty Agreement, dated as of September 8, 2020, by Enterprise
Products Partners L.P. in favor of Citibank, N.A., as Administrative
Agent.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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