Terra Nitrogen Company, L.P. Reports Exercise of Right to Purchase Common Units and Declares Quarterly Distribution
08 2월 2018 - 7:20AM
Business Wire
Terra Nitrogen Company, L.P. (“TNCLP”) (NYSE: TNH) announced
today that, in accordance with Section 17.1 of TNCLP’s First
Amended and Restated Agreement of Limited Partnership, as amended
(the “Partnership Agreement”), Terra Nitrogen GP Inc., a Delaware
corporation and the sole general partner of TNCLP (“TNGP” or the
“General Partner”), has elected to exercise the right, assigned to
TNGP by TNCLP, to purchase all of the issued and outstanding common
units representing limited partner interests in TNCLP not already
owned by TNGP or its affiliates (the “Units”).
TNGP will purchase the Units on April 2, 2018 (the “Purchase
Date”) for a cash purchase price of $84.033 per Unit. The purchase
price was determined in accordance with Section 17.1 of the
Partnership Agreement as the average of the daily closing prices
per common unit for the 20 consecutive trading days beginning with
January 5, 2018 and ending with February 2, 2018.
As of the Purchase Date, all rights of the holders of the Units
will cease, except for the right to receive payment of the purchase
price. Upon completion of the purchase on the Purchase Date, TNGP
will own 100 percent of the Units and will be entitled to all of
the benefits resulting from the Units. In addition, upon completion
of the purchase, the common units representing limited partner
interests in TNCLP will cease to be publicly traded or listed on
the New York Stock Exchange.
TNCLP also announced today the declaration of a cash
distribution for the quarter ended December 31, 2017, of $2.03 per
common limited partnership unit. The distribution is payable
February 28, 2018, to holders of record as of February 16,
2018.
Cash distributions depend on TNCLP’s cash requirements for
working capital needs and capital expenditures, as well as its
earnings, which can be affected by nitrogen fertilizer selling
prices, natural gas costs, seasonal demand factors, production
levels and weather. The calculation of available cash for the cash
distribution for the quarter ended December 31, 2017 included the
proceeds from the previously-announced sale of TNCLP’s 50% interest
in the Oklahoma CO2 Partnership joint venture that closed in the
fourth quarter of 2017. Cash distributions per limited partnership
unit also vary based on increasing amounts allocable to the General
Partner when cumulative distributions exceed targeted levels. With
this distribution, TNCLP cumulative distributions continue to
exceed targeted levels. As a result of TNGP’s exercise of the right
to purchase the Units, there will be no further cash distributions
on the common limited partnership units after the distribution
payable February 28, 2018.
This release serves as a qualified notice to nominees and
brokers as provided for under Treasury Regulation Section
1.1446-4(b). Please note that 100 percent of TNCLP’s distributions
to foreign investors are attributable to income that is effectively
connected with a United States trade or business. Accordingly,
TNCLP’s distributions to foreign investors are subject to federal
income tax withholding at the highest effective tax rate.
About TNCLP
Terra Nitrogen Company, L.P. is a leading manufacturer of
nitrogen fertilizer products.
Terra Nitrogen, Limited Partnership (TNLP), owner of the
Verdigris, Oklahoma manufacturing facility and related assets, is a
subsidiary of TNCLP. Terra Nitrogen GP Inc., an indirect,
wholly-owned subsidiary of CF Industries Holdings, Inc., is the
General Partner of TNCLP and TNLP and exercises full control over
all of TNCLP’s and TNLP’s business affairs.
Forward-Looking
Statements
All statements in this communication, other than those relating
to historical facts, are forward-looking statements. These
forward-looking statements are not guarantees of future performance
and are subject to a number of assumptions, risks and
uncertainties, many of which are beyond TNCLP’s control, which
could cause actual results to differ materially from such
statements. Important factors that could cause actual results to
differ materially from expectations include, among others:
- Risks related to TNCLP’s reliance on
one production facility;
- The cyclical nature of TNCLP’s business
and the agricultural sector;
- The volatility of natural gas prices in
North America;
- The global commodity nature of TNCLP’s
fertilizer products, the impact of global supply and demand on
TNCLP’s selling prices, and the intense global competition from
other fertilizer producers;
- Conditions in the U.S. agricultural
industry;
- Difficulties in securing the supply and
delivery of raw materials, increases in their costs or delays or
interruptions in their delivery;
- Reliance on third party providers of
transportation services and equipment;
- The significant risks and hazards
involved in producing and handling TNCLP's products against which
it may not be fully insured;
- Risks associated with cyber
security;
- Weather conditions;
- Potential liabilities and expenditures
related to environmental, health and safety laws and regulations,
and permitting requirements;
- Future regulatory restrictions and
requirements related to greenhouse gas emissions;
- The seasonality of the fertilizer
business;
- Risks involving derivatives and the
effectiveness of TNCLP’s risk measurement and hedging
activities;
- Limited access to capital;
- Acts of terrorism and regulations to
combat terrorism;
- Risks related to TNCLP’s dependence on
and relationships with CF Industries;
- Deterioration of global market and
economic conditions;
- Risks related to TNCLP's partnership
structure and control of TNCLP’s General Partner by CF
Industries;
- Changes in TNCLP’s available cash for
distribution to its unitholders, due to, among other things,
changes in its earnings, the amount of cash generated by its
operations and the amount of cash reserves established by its
General Partner for operating, capital and other requirements;
- The conflicts of interest that may be
faced by the executive officers of TNCLP’s General Partner, who
operate both TNCLP and CF Industries; and
- Tax risks to TNCLP's common unitholders
and changes in TNCLP’s treatment as a partnership for U.S. or state
income tax purposes.
More detailed information about factors that may affect TNCLP’s
performance may be found in its filings with the Securities and
Exchange Commission, including its most recent periodic reports
filed on Form 10-K and Form 10-Q, which are available through CF
Industries’ website. Forward-looking statements are given only as
of the date of this release and TNCLP disclaims any obligation to
update or revise the forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
Terra Nitrogen Company, L.P. news announcements are also
available on CF Industries’ Web site, www.cfindustries.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20180207006315/en/
Terra Nitrogen Company, L.P.Martin JarosickVice President,
Investor Relations847-405-2045mjarosick@cfindustries.com
Terra Nitrogen Company . (NYSE:TNH)
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