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Subsequent Events
3 Months Ended
Mar. 31, 2015
Subsequent Events  
Subsequent Events

Note 18.Subsequent Events

 

On April 9, 2015, the Partnership, as Buyer, entered into a Sale and Purchase Agreement (the “Purchase Agreement”) with Liberty Petroleum Realty, LLC, East River Petroleum Realty, LLC, Big Apple Petroleum Realty, LLC, White Oak Petroleum, LLC, Anacostia Realty, LLC, Mount Vernon Petroleum Realty, LLC and DAG Realty, LLC (collectively, “Capitol Petroleum Group”), as Seller.  Under the terms of the Purchase Agreement, the Partnership will acquire 97 primarily Mobil and Exxon branded retail gasoline stations and seven dealer supply contracts in New York City and Prince George’s County, Maryland, along with certain related supply, franchise agreements, third party leases and other assets associated with the operations (collectively, the “Acquired Assets”) for a cash purchase price of approximately $156.0 million, subject to certain post-closing adjustments related to the Acquired Assets at the time of closing (the “CPG Acquisition”).  Of the 97 locations, 18 are fee properties and the balance are the subject of long term leases.

 

The Purchase Agreement provides that the closing will take place on or before June 1, 2015, subject to a one-time extension not to exceed 30 days, if required in connection with satisfying certain closing conditions, including filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR”) (the “Closing Date”).  Closing of the CPG Acquisition is conditioned upon the satisfaction or waiver of customary closing conditions, including HSR approval, certain third party rights of first refusal and delivery of all items required by the Purchase Agreement.

 

The Purchase Agreement contains customary representations and warranties and covenants by each of the parties. Among other covenants, during the period between the execution of the Purchase Agreement and the closing of the CPG Acquisition, Capitol Petroleum Group has agreed to conduct its business in substantially the same manner previously conducted and not to engage in certain types of activities and transactions.  At closing, subject to the terms and conditions set forth in the Purchase Agreement, the Partnership will assume certain liabilities and obligations of Capitol Petroleum Group related to the Acquired Assets. The Partnership expects to finance the CPG Acquisition with borrowings under its revolving credit facility.

 

The Partnership will account for this transaction as a business combination, and management is currently in the process of evaluating the preliminary purchase price accounting.  The Partnership intends to engage a third-party valuation firm to assist in the valuation of the Acquired Assets and possible intangible assets.  The operations of Acquired Assets are expected to be reported within the Partnership’s GDSO segment upon closing.

 

On April 22, 2015, the board of directors of the General Partner declared a quarterly cash distribution of $0.68 per unit ($2.72 per unit on an annualized basis) for the period from January 1, 2015 through March 31, 2015.  On May 15, 2015, the Partnership will pay this cash distribution to its unitholders of record as of the close of business on May 6, 2015.