Note 9: Financing

Notes and Debentures

As of June 30, 2013, and December 31, 2012, the Partnership had notes and debentures outstanding of $3.0 billion with a weighted-average interest rate of 5.32%. The indentures governing the notes and debentures have restrictive covenants which provide that, with certain exceptions, neither the Partnership nor any of its subsidiaries may create, assume or suffer to exist any lien upon any property to secure any indebtedness unless the debentures and notes shall be equally and ratably secured. All debt obligations are unsecured. At June 30, 2013, the Partnership and its subsidiaries were in compliance with its debt covenants.

Issuance of Notes

During the six months ended June 30, 2013 and 2012, the Partnership completed the following debt issuance (in millions, except interest rates):



Date of Issuance	Issuing Subsidiary	Amount of Issuance	Purchaser Discounts and Expenses	Net Proceeds			Interest Rate	Maturity Date	Interest Payable
June 2012	Gulf South	$300.0	$3.5		$296.5	⁽¹⁾	4.00%	June 15, 2022	June 15 and December 15

(1) The net proceeds of this offering were used to reduce borrowings under the Partnership's revolving credit facility.

Revolving Credit Facility

Outstanding borrowings under the Partnership’s revolving credit facility as of June 30, 2013, and December 31, 2012, were $20.0 million and $302.0 million, with a weighted-average borrowing rate of 1.32% and 1.34%.

The credit facility contains various restrictive covenants and other usual and customary terms and conditions, including the incurrence of additional debt, the sale of assets and sale-leaseback transactions. The financial covenants under the credit facility require the Partnership and its subsidiaries to maintain, among other things, a ratio of total consolidated debt to consolidated EBITDA (as defined in the Amended Credit Agreement) measured for the previous twelve months of not more than 5.0 to 1.0, or up to 5.5 to 1.0 for the three quarters following an acquisition. The Partnership and its subsidiaries were in compliance with all covenant requirements under the credit facility as of June 30, 2013.

Term Loan

The Partnership has a $225.0 million variable-rate term loan due October 1, 2017 (2017 Term Loan), which was entered into to partially finance the acquisition of Louisiana Midstream. The 2017 Term Loan bears interest at a rate that is based on the one-month London Interbank Offered Rate (LIBOR) rate plus an applicable margin. Outstanding borrowings as of June 30, 2013 and December 31, 2012, were $225.0 million, with a weighted-average borrowing interest rate of 1.95% and 1.96%.

Common Unit Offering

For the six months ended June 2013 and 2012, the Partnership completed the following issuances and sales of common units (in millions, except the issuance price):



Month of Offering	Number of Common Units	Issuance Price	Less Underwriting Discounts and Expenses	Net Proceeds (including General Partner Contribution)	Common Units Outstanding After Offering	Common Units Held by the Public After Offering
May 2013 ⁽¹⁾	12.7	$30.12	$12.3	$376.5	220.4	117.6
February 2012 ⁽²⁾	9.2	$27.55	$8.5	$250.2	184.9	82.2

(1) The net proceeds of this offering were used to repay borrowings outstanding under the Partnership's credit facility.

(2) The net proceeds were used to purchase the remaining equity ownership interest in HP Storage from BPHC.

Class B Units

The Class B units are convertible into common units upon demand by the holder on a one-for-one basis at any time after June 30, 2013. The Partnership expects the Class B units to be converted in the third quarter 2013.