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EX-4.2 - EX-4.2 - ANDEAVORd645464dex42.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 17, 2013

 

 

Tesoro Corporation

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   1-3473   95-0862768

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

19100 Ridgewood Pkwy

San Antonio, Texas

  78259-1828
(Address of principal executive offices)   (Zip Code)

(210) 626-6000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 1.01 Entry into a Material Definitive Agreement.

Senior Notes and Indenture

On December 17, 2013, Tesoro Logistics LP (the “Partnership”), a consolidated subsidiary of Tesoro Corporation (the “Company”) and whose general partner, Tesoro Logistics GP, LLC, is a wholly-owned subsidiary of the Company, and its wholly-owned subsidiary Tesoro Logistics Finance Corp. (together with the Partnership, the “Issuers”) closed their previously announced offering (the “Offering”) of $250.0 million aggregate principal amount of the Issuers’ 5.875% Senior Notes due 2020 (the “Senior Notes”) pursuant to a private placement transaction conducted under Rule 144A and Regulation S of the Securities Act of 1933, as amended (the “Securities Act”). The Partnership used the proceeds from the Offering (i) to repay $250.0 million of indebtedness outstanding under its revolving credit facility, which amounts were used to fund a portion of the Partnership’s acquisition of two marine terminals, a marine storage terminal, a products terminal, a petroleum coke handling and storage facility, over 100 miles of active crude oil and refined products pipelines and certain other related assets and properties from Tesoro Refining & Marketing Company LLC, a subsidiary of the Company, (ii) to pay estimated fees and expenses related to the Offering and (iii) for general partnership purposes.

The Senior Notes were issued pursuant to the Third Supplemental Indenture, dated as of December 17, 2013 (the “Supplemental Indenture”), to the Indenture, dated as of September 14, 2012 (the “Base Indenture,” together with the Supplemental Indenture, the “Indenture”), among the Issuers, the guarantors party thereto (the “Guarantors”) and U.S. Bank National Association, as trustee. The Senior Notes were issued as additional notes under the Base Indenture governing the Issuers’ 5.875% Senior Notes due 2020 that were issued on September 14, 2012 (the “Existing Notes”). Interest on the Senior Notes accrues beginning on October 1, 2013 at a rate of 5.875% per year. Interest on the Senior Notes is payable semi-annually on April 1 and October 1 of each year, commencing on April 1, 2014, and the Senior Notes mature on October 1, 2020. The Indenture contains customary terms, events of default and covenants for an issuer of non-investment grade debt securities. These covenants include limitations on, among other things, making investments, incurring additional indebtedness or issuing preferred units, paying dividends or making distributions on units or redeeming or repurchasing subordinated debt, creating liens, incurring dividend or other payment restrictions affecting subsidiaries, selling assets, merging or consolidating with other entities and entering into transactions with affiliates. On or after October 1, 2016, the Issuers may on any one or more occasions redeem some or all of the Senior Notes at a purchase price equal to 102.938% of the principal amount of the Senior Notes, plus accrued and unpaid interest to the redemption date, if any, such optional redemption prices decreasing to 101.469% on or after October 1, 2017, and 100.000% on or after October 1, 2018. Prior to October 1, 2015, the Issuers may on any one or more occasions redeem up to 35% of the aggregate principal amount of the Senior Notes with the net proceeds of certain equity offerings at 105.875% of the aggregate principal amount thereof, plus accrued and unpaid interest to the redemption date, if any. Prior to October 1, 2016, the Issuers may redeem some or all of the Senior Notes at a make-whole price plus accrued and unpaid interest to the redemption date, if any. If a change of control triggering event occurs, the holders of the Senior Notes may require the Issuers to purchase for cash all or a portion of their Senior Notes at a purchase price equal to 101% of the principal amount of the Senior Notes, plus accrued and unpaid interest to the redemption date, if any.

The Senior Notes are expected to be treated as a single series with the Existing Notes and will have the same terms as those of the Existing Notes, except that (i) the Senior Notes will be subject to a separate registration rights agreement and (ii) the Senior Notes will be issued initially under CUSIP numbers different from the Existing Notes. The Senior Notes and the Existing Notes will vote as one class under the Indenture. Holders who exchange their Senior Notes in the registered exchange offer described below will receive registered notes that are expected to share a single CUSIP number with the Existing Notes, and we expect that such registered notes and the Existing Notes will thereafter be fungible. Prior to that, the Senior Notes will trade separately from the Existing Notes.

The Senior Notes are senior unsecured obligations of the Issuers and will rank equally in right of payment with all of the Issuers’ existing and future senior debt and senior to any future indebtedness of the Issuers that expressly provides for subordination to the Senior Notes. The Senior Notes are guaranteed on a senior unsecured basis by the Guarantors. The guarantees will rank equally in right of payment with all of the existing and future senior debt of the Guarantors and senior to any future indebtedness of the Guarantors that expressly provides for subordination to the guarantees. The Senior Notes and guarantees are effectively subordinated to any secured debt, to the extent of the assets securing such debt, including indebtedness under the Partnership’s revolving credit agreement.

The Senior Notes are unsecured and guaranteed by all of the Partnership’s domestic subsidiaries, except Tesoro Logistics Finance Corp., and are non-recourse to the Company and its consolidated subsidiaries, except for Tesoro Logistics GP, LLC and the Partnership and its consolidated subsidiaries.

The foregoing summaries of the Indenture and the Senior Notes do not purport to be complete and are qualified in their entirety by reference to the Base Indenture, which includes the form of the certificate for the Senior Notes, a copy of which was previously filed as Exhibit 4.1 to the Company’s Form 8-K filed on September 17, 2012 and incorporated herein by reference, and the Supplemental Indenture, a copy of which is filed as Exhibit 4.2 to this Form 8-K and incorporated herein by reference.


Registration Rights Agreement

In connection with the Offering, the Issuers and the Guarantors entered into a Registration Rights Agreement, dated as of December 17, 2013, with Wells Fargo Securities LLC, as representative of the several initial purchasers (the “Registration Rights Agreement”). Under the Registration Rights Agreement, the Issuers and the Guarantors have agreed to file with the Securities and Exchange Commission and use commercially reasonable efforts to cause to become effective a registration statement with respect to an offer to exchange the Senior Notes for substantially identical notes (other than with respect to restrictions on transfer or to any increase in annual interest rate) that are registered under the Securities Act so as to permit the exchange offer to be consummated by the 365th day after December 17, 2013. Under specified circumstances, the Issuers and Guarantors have also agreed to use commercially reasonable efforts to cause to become effective a shelf registration statement relating to resales of the Senior Notes. The Issuers will be obligated to pay additional interest if they fail to comply with their obligations to register the Senior Notes within the specified time periods.

The foregoing summary of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the Registration Rights Agreement, a copy of which is filed as Exhibit 4.3 to this Form 8-K and incorporated herein by reference.

 

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The description above under Item 1.01 is incorporated in this Item 2.03 by reference.


Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit
Number

  

Description of the Exhibit

4.1    Indenture dated as of September 14, 2012 among Tesoro Logistics LP, Tesoro Logistics Finance Corp., the Guarantors (as defined) and U.S. Bank National Association, as trustee (incorporated by reference from Exhibit 4.1 of the Company’s Form 8-K filed on September 17, 2012).
4.2    Third Supplemental Indenture, dated as of December 17, 2013, among Tesoro Logistics LP, Tesoro Logistics Finance Corp., the guarantors named therein and U.S. Bank National Association, as trustee.
4.3    Registration Rights Agreement, dated as of December 17, 2013, among Tesoro Logistics LP, Tesoro Logistics Finance Corp., the guarantors named therein and Wells Fargo Securities LLC, as representative of the several initial purchasers.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: December 17, 2013

 

TESORO CORPORATION
By:   /s/ G. SCOTT SPENDLOVE
  G. Scott Spendlove
  Senior Vice President and Chief Financial Officer


Index to Exhibits

 

Exhibit
Number

  

Description of the Exhibit

4.1    Indenture dated as of September 14, 2012 among Tesoro Logistics LP, Tesoro Logistics Finance Corp., the Guarantors (as defined) and U.S. Bank National Association, as trustee (incorporated by reference from Exhibit 4.1 of the Company’s Form 8-K filed on September 17, 2012).
4.2    Third Supplemental Indenture, dated as of December 17, 2013, among Tesoro Logistics LP, Tesoro Logistics Finance Corp., the guarantors named therein and U.S. Bank National Association, as trustee.
4.3    Registration Rights Agreement, dated as of December 17, 2013, among Tesoro Logistics LP, Tesoro Logistics Finance Corp., the guarantors named therein and Wells Fargo Securities LLC, as representative of the several initial purchasers.