Petrologistics solicits consent for senior notes due 2020

24 Jun '14

5 min read

The Final Consent Payment is expected to be paid promptly following the satisfaction or waiver by the New Parent of the conditions set forth in the Consent Solicitation Statement (as defined below) for the Final Consent Payment, including the consummation of the Merger. Subject to obtaining required regulatory approvals and the satisfaction or waiver of other specified conditions, and based on the information currently available, the Merger is expected to be consummated by November 27, 2014.

Flint Hills has informed the Issuers that, in connection with the Merger, it intends to effect an internal restructuring of the Company and its subsidiaries. Flint Hills will also provide the Company with a new unsecured pari passu revolving credit facility (replacing the existing secured structurally senior facility), contribute a demand note to the Company and put in place other arrangements that will effectively support the Issuers' obligation to pay principal and interest on the outstanding Notes.

Although there can be no assurances, Flint Hills believes the Notes should be assigned investment grade ratings by each of Standard & Poor's Ratings Services ("S&P") and Moody's Investors Service, Inc. ("Moody's") following the consummation of the Merger as a result of the foregoing actions.

Subsequent to the announcement of the Merger Agreement on May 27, 2014, both S&P and Moody's published public press releases on May 28, 2014. S&P placed the Notes on watch positive and Moody's placed the Notes under review for possible upgrade. S&P's and Moody's review of the Notes for possible voting actions is ongoing.

The Consent Solicitation will expire at 5:00 p.m., New York City time, on July 2, 2014 (such date and time, as the same may be extended by the Issuers from time to time, the "Expiration Time"). Only holders of record of the Notes (or participants in The Depository Trust Company acting under an omnibus proxy) as of 5:00 p.m., New York City time, on June 23, 2014 (the "Record Date"), are eligible to deliver consents to the Proposed Amendments in the Consent Solicitation.

Holders of Notes for which no consent is delivered prior to the Expiration Time will be bound by the Supplemental Indenture if the Effective Time occurs, and will not be entitled to receive the Consent Payment.

The Consent Solicitation is being made solely on the terms and subject to the conditions set forth in the consent solicitation statement dated June 24, 2014, as the same may be amended or supplemented from time to time (the "Consent Solicitation Statement"), and the accompanying consent letter. The Issuers may, in their sole discretion, terminate, extend oramend the Consent Solicitation at any time as described in the Consent Solicitation Statement.

PetroLogistics LP

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