Form 8-K - Current report

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): November 17, 2023

USD Partners LP

(Exact name of registrant as specified in its charter)

Delaware

001-36674

30-0831007

(State or other jurisdiction of

incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

811 Main Street, Suite 2800

Houston, Texas 77002

(Address of principal executive offices) (Zip Code)

(281) 291-0510

Registrant’s telephone number, including area code

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:


☐			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))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Units Representing Limited Partner Interests

USDP

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 1.01			Entry into a Material Definitive Agreement

On November 17, 2023, USD Partners LP (the “Partnership”) entered into an agreement (the “Third Waiver Extension Agreement”) with (i) all the lenders (the “Lenders”) under the secured Credit Agreement (as amended from time to time, the “Credit Agreement”) among the Partnership, USD Terminals Canada ULC, an indirect, wholly-owned subsidiary of the Partnership (together with the Partnership, the “Borrowers”), the subsidiary guarantors party thereto, the Lenders and Bank of Montreal, as administrative agent (the “Administrative Agent”), and (ii) the Administrative Agent.

As previously disclosed, on August 8, 2023, the Partnership entered into an amendment to the Credit Agreement (the “Fourth Amendment”), pursuant to which the Lenders agreed to forebear through and including October 10, 2023 (the “Expiration Date”), from exercising any rights or remedies arising from certain defaults or events of default asserted by the Administrative Agent, which the Partnership disputed, or certain prospective defaults or events of default under the Credit Agreement and other loan documents arising from, among other things, any failure to disclose certain events that give or may give rise to a Material Adverse Effect. Also as previously disclosed, on October 6, 2023, the Partnership entered into a waiver extension agreement (the “First Waiver Extension Agreement”), pursuant to which the Lenders and Administrative Agent agreed to, among other things, (i) extend the Expiration Date to November 3, 2023 (the “First Extended Expiration Date”) and (ii) waive the event of default arising from the non-payment of the interest due on October 10, 2023 until the First Extended Expiration Date. Additionally as previously disclosed, on November 1, 2023, the Partnership entered into a waiver extension agreement (the “Second Waiver Extension Agreement”), pursuant to which the Lenders and Administrative Agent agreed to, among other things, (i) extend the First Extended Expiration Date to November 17, 2023 (the “Second Extended Expiration Date”) and (ii) temporarily waive, until the Second Extended Expiration Date, events of default from the non-payment of amounts due on the maturity date.

The Third Waiver Extension Agreement further extends the Second Extended Expiration Date to November 21, 2023 (the “New Expiration Date”) in respect of certain events of default or prospective events of default described in the Fourth Amendment, the First Waiver Extension Agreement and the Second Waiver Extension Agreement.

The above description of the terms of the Third Waiver Extension Agreement does not purport to be complete and is qualified in its entirety by the full text of (i) the Third Waiver Extension Agreement, which is attached as an exhibit hereto and incorporated herein by reference, (ii) the Second Waiver Extension Agreement, which is attached as an exhibit to the Partnership’s Current Report on Form 8-K filed on November 2, 2023, (iii) the First Waiver Extension Agreement, which is attached as an exhibit to the Partnership’s Current Report on Form 8-K filed on October 6, 2023, and (iv) the Fourth Amendment, which is attached as an exhibit to the Partnership’s Quarterly Report on Form 10-Q for the three months ended June 30, 2023. Capitalized terms used but not defined herein have the meaning set forth in the Third Waiver Extension Agreement. The above information is also qualified by reference to the “Risk Factors” provided in the Partnership’s Quarterly Reports on Form 10-Q for the three months ended September 30, 2023 and June 30, 2023, which shall be deemed updated for the information provided herein, and Annual Report on Form 10-K for the year ended December 31, 2022.


Item 7.01			Regulation FD Disclosure.

On November 17, 2023, the Partnership issued a press release announcing certain of the matters described in this Current Report on Form 8-K. A copy of this press release is attached hereto as Exhibit 99.1 to this Current Report. The information set forth in this Item 7.01 and in Exhibit 99.1 shall not be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.


Item 9.01			Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number

Description

10.1

Letter Agreement, dated November 17, 2023, among USD Partners LP, USD Terminals Canada ULC, the subsidiary guarantors party thereto, Bank of Montreal, as administrative agent, and the other lenders and parties thereto.

99.1

Press release of USD Partners LP dated November 17, 2023.

104

The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.

SIGNATURES

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

USD Partners LP
(Registrant)

By:

USD Partners GP LLC,

its general partner

Date: November 17, 2023

By:

/s/ Adam Altsuler

Name:

Adam Altsuler

Title:

Executive Vice President, Chief Financial Officer

Exhibit 10.1

AGREEMENT TO EXTEND TEMPORARY WAIVER PERIOD

November 17, 2023

USD Partners LP
811 Main St. #2800
Houston, TX 77002
Attn: Adam Altsuler

Re: Agreement to Extend Short-Term Waiver Period (this “Agreement”)

Ladies and Gentlemen:

Reference is made to that certain (i) Credit Agreement dated as of November 2, 2018, among USD Partners LP, a Delaware limited partnership, as a borrower (the “US Borrower”), USD Terminals Canada ULC, an unlimited liability company subsisting under the laws of the Province of British Columbia, Canada, as a borrower (the “Canadian Borrower”, and together with the US Borrower, the “Borrowers” and each a “Borrower”), the Guarantors party thereto from time to time, the lenders party thereto from time to time (the “Lenders”), and Bank of Montreal as administrative agent (in such capacity, the “Administrative Agent”) (as amended by that certain Master Assignment, Assignment of Liens, and Amendment No. 1 to Amended and Restated Credit Agreement dated as of October 29, 2021, Amendment No. 2 to Amended and Restated Credit Agreement dated as of April 6, 2022, Amendment No. 3 to Amended and Restated Credit Agreement dated as of January 31, 2023, and Amendment No. 4 to Amended and Restated Credit Agreement dated as of August 8, 2023 (“Amendment No. 4”), and as further amended, restated, modified, waived or otherwise supplemented from time to time prior to the date hereof, the “Credit Agreement”), (ii) Agreement to Extend Temporary Waiver Period and Waiver of Event of Default for Missed Interest Payment dated as of October 6, 2023, among the Borrowers, the Guarantors party thereto, the Lenders party thereto and the Administrative Agent (the “October Short-Term Waiver”) and (iii) Agreement to Extend Temporary Waiver Period and Temporary Waiver of Event of Default for Missed Payment on Maturity Date, dated as of November 1, 2023, among the Borrowers, the Guarantors party thereto, the Lenders party thereto and the Administrative Agent (the “November Short-Term Waiver, and together with the October Short-Term Waiver, collectively, the “Short-Term Waivers”, and each a “Short-Term Waiver”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings ascribed to them in the Credit Agreement.

A. The parties hereto have agreed that the Expiration Date (as defined in Amendment No. 4) of November 17, 2023 be extended to November 21, 2023. Pursuant to the definition of the Expiration Date in Amendment No. 4, the Borrowers and the Guarantors, on the one hand, and the Administrative Agent and the Required Lenders, on the other hand, may extend the Expiration Date

B. The Agent and the Lenders are willing to extend the existing Expiration Date to November 21, 2023, subject to the terms and conditions of this Agreement.

C. Each Borrower and each Guarantor hereby agrees that the Administrative Agent and the Lenders are entering into this Agreement in reliance on the truth and accuracy of the foregoing recitals and the representations and warranties made herein respectively by the Borrowers and the Guarantors.

1. Extension Request and Limited Waiver. The Borrowers and the Guarantors hereby agree, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and in consideration of the agreements herein contained, including the conditions precedent set forth in Section 2 below, the Administrative Agent and the Lenders hereby agree to extend the Expiration Date to 12:00 pm, New York time, November 21, 2023, time being of the essence, the period from the Effective Date (defined below) until the Expiration Date shall herein be called, “Extended Short-Term Waiver Period”), INSOFAR AS AND ONLY FOR SO LONG AS no Default or Event of Default (other than the Subject Defaults (as defined in each of the Short-Term Waivers) (collectively hereinafter, the “Subject Defaults”)) has occurred and is continuing on the date hereof or at any time during the Extended Short-Term Waiver Period. The Lenders hereby direct the Administrative Agent not to take any action or enforce any remedies under the Loan Documents or applicable law against the Borrowers or Guarantors solely with respect to the Subject Defaults, through the Expiration Date and the expiration of the Extended Short-Term Waiver Period. The Lenders shall not direct the Administrative Agent to take any action or enforce any remedies under the Loan Documents or applicable law against the Borrowers or Guarantors solely with respect to the Subject Defaults through the Expiration Date and the expiration of the Extended Short-Term Waiver Period.

2. Conditions Precedent to Effectiveness. The effectiveness of this Agreement is subject to the satisfaction of the following conditions precedent (the first date of satisfaction of all such conditions herein, the “Effective Date”):

(i) The Administrative Agent shall have received duly executed counterparts of this Agreement from the Borrowers, the Guarantors, the Administrative Agent, and the Required Lenders.

(ii) Each of the Borrowers and the Guarantors shall have confirmed and acknowledged to the Administrative Agent and the Lenders, that by its execution and delivery of this Agreement that they do hereby confirm and acknowledge to the Administrative Agent and the Lenders, that (a) the execution, delivery and performance of this Agreement has been duly authorized by all requisite corporate action on its part; (b) the Credit Agreement and each other Loan Document to which it is a party constitute valid and legally binding agreements enforceable against it, in accordance with their respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other similar laws relating to or affecting the enforcement of creditors’ rights generally and by general principles of equity; (c) after giving effect to this Agreement, the representations and warranties by the Borrowers or the Guarantors as applicable, contained in the Credit Agreement, Amendment No. 4 and in the other Loan Documents (other than with respect to any Subject Defaults, Sections 5.05(c) and 5.07 of the Credit Agreement), to which it is a party, are true and correct on and as of the date hereof in all material respects as though made as of the date hereof, except to the extent such representations and warranties are qualified by materiality, in which case they shall be true and correct in all respects; (d) all of its obligations under Section 5 of Amendment No. 4 are hereby ratified and confirmed by such Borrower or Guarantor; and (e) no Default or Event of Default (other than the Subject Defaults) shall exist under the Credit Agreement or any of the other Loan Documents after giving effect to this Agreement.

3. Release. The Borrowers and the Guarantors hereby reaffirm and ratify the terms of the Release provision set forth in Section 11 of Amendment No. 4, as to any and all acts or inactions of the Lenders and the Administrative Agent though the Effective Date, and upon the Borrowers’ and the Guarantors’ execution of this Agreement, each such Release is being granted anew by each signatory hereunder upon the execution date of this Agreement (for the avoidance of doubt these Releases are in addition to the Release having already been granted with the execution of Amendment No. 4), and each of the Borrowers and the Guarantors, on behalf of themselves and each of their respective successors, legal representatives and assigns, as well as any other party claiming by, through or under each such entity (each a “Releasing Party” and collectively, the “Releasing Parties”) hereby

release, waive, forever relinquish and agree to hold harmless from and against any and all claims, demands, obligations, liabilities and causes of action of whatever kind or nature, whether known or unknown, liquidated or unliquidated, contingent or certain, and asserted or unasserted, which any of the Releasing Parties have, had, or may have or might assert from the beginning of time up through and including the date of execution of this Agreement against the Administrative Agent, the Lenders and/or their respective parents, affiliates, participants, officers, directors, employees, agents, attorneys, accountants, representatives, consultants, successors and assigns, directly or indirectly, which occurred, existed, was taken, permitted or begun at any time prior to and up to the execution of this Agreement, arising out of, based upon, or in any manner connected with (i) any transaction, event, circumstance, action, failure to act or occurrence of any sort of type, whether known or unknown, including without limitation any and all such claims arising out of or related, in any respect, to the Credit Agreement, any other Loan Document and/or the administration thereof or the Obligations created thereby, or (ii) any matter related to, in any respect, the foregoing, in each case, prior to the execution of this Agreement.

4. Reservation of Rights. Notwithstanding anything contained in this Agreement to the contrary, the Borrowers and the Guarantors acknowledge that the Administrative Agent and the Lenders do not waive, and expressly reserve, the right to exercise any and all of their rights and remedies under the Credit Agreement, any other Loan Document and applicable law, in each case, in respect of any Default or Event of Default (other than with regard to the Subject Defaults), regardless of when such Defaults or Events of Default may have arisen or come into existence.

Without limiting the generality of the foregoing, the Borrowers and the Guarantors hereby agree that (i) none of the Administrative Agent, the Lenders or the L/C Issuers, has waived or does waive any defaults, and its wavier herein is solely a limited, temporary waiver of only the Subject Defaults and it expires upon the earlier of the expiration of the Extended Short-Term Waiver Period or a noticed default, (ii) any forbearance of any rights, powers, privileges and other remedies by the Administrative Agent, the Lenders or the L/C Issuers, under the Loan Documents, or at law or in equity, with respect to any of the Subject Defaults or any other event of default, whether or not identified above, or any other current or future Default or Event of Default shall not be, and shall not be construed as, a waiver, ratification, release or limitation thereof, and the Administrative Agent, the Lenders and the L/C Issuers, expressly reserve their respective rights to invoke fully any and all such rights, powers, privileges and other remedies under the Loan Documents, or at law or in equity, at any time the Administrative Agent, the Lenders or the L/C Issuers, deem appropriate in respect thereof, in accordance with the Loan Documents, and without further notice, (iii) the Administrative Agent, the Lenders and the L/C Issuers, as applicable, reserve the right at any time to identify and assert additional Defaults or Events of Default that may exist, arise now or hereafter, or come to exist under the Loan Documents and demand any sums that may be, or become, due under the Loan Documents as a result thereof, including, without limitation, accrued and unpaid late charges and costs of collection (including, without limitation, attorneys’ fees and expenses) and other costs, and (iv) nothing contained herein, or in any other correspondence, shall constitute, or be deemed to constitute, a modification of, or waiver under, the Loan Documents, or acceptance of any event, occurrence or circumstance that may constitute a Default or an Event of Default under the Loan Documents.

5. Severability. Any provision of this Agreement held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Agreement and the effect thereof shall be confined to the provisions so held to be invalid. This Agreement shall constitute a Loan Document for purposes of the Credit Agreement.

6. Counterparts and Governing Law. The counterpart execution provisions set forth in Section 11.10 or the Credit Agreement and the governing law provisions set forth in Section 11.15 of the Credit Agreement are incorporated herein by reference mutatis mutandis.

[The remainder of this page is intentionally left blank; signature pages to follow]

This Agreement is executed as of the day and year first above written.

ADMINISTRATIVE AGENT, L/C ISSUER, SWING LINE LENDER AND LENDER:

BANK OF MONTREAL,

as Administrative Agent, L/C Issuer, Swing Line Lender, and a Lender

By: /s/ Radhika Kapur

Name: Radhika Kapur

Title: Director

LENDERS:

U.S. BANK NATIONAL ASSOCIATION,

as L/C Issuer and a Lender

By: /s/ Timothy Scheer

Name: Timothy Scheer

Title: Senior Vice President

CITIBANK, N.A.,

as L/C Issuer and a Lender

By: /s/ Gabe Juarez

Name: Gabe Juarez

Title: Vice President

FIRST HORIZON BANK,

as a Lender

By: /s/ Mike Smith

Name: Mike Smith

Title: Vice President

GOLDMAN SACHS BANK USA,

as a Lender

By:/s/ Andrew B. Vernon

Name: Andrew B.Vernon

Title: Authorized Signatory

Acknowledged and agreed to by:

BORROWERS AND GUARANTORS:

USD PARTNERS LP

By: USD PARTNERS GP LLC, its general partner

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Executive Vice President and Chief Financial Officer

USD TERMINALS CANADA ULC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

USD LOGISTICS OPERATIONS GP LLC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Executive Vice President and Chief Financial Officer

USD LOGISTICS OPERATIONS LP

By: USD LOGISTICS OPERATIONS GP LLC, its general partner

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Executive Vice President and Chief Financial Office

WEST COLTON RAIL TERMINAL LLC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Executive Vice President and Chief Financial Officer

USD TERMINALS LLC

By :/s/ Adam Altsuler

Name: Adam Altsuler

Title Executive Vice President and Chief Financial Officer

USD RAIL LP

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Executive Vice President and Chief Financial Officer

USD RAIL CANADA ULC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

USD TERMINALS CANADA II ULC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

USD TERMINALS CANADA III ULC

By/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

USDP FINANCE CORP.

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Chief Financial Officer

STROUD CRUDE TERMINAL LLC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

SCT PIPELINE LLC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

USDP CCR LLC

By:/s/ Adam Altsuler

Name: Adam Altsuler

Title: Senior Vice President and Chief Financial Officer

Exhibit 99.1

November 17, 2023

USD Partners Announces Third Waiver Extension Agreement Under Credit Agreement

Houston, TX – USD Partners LP (OTC: USDP) (the “Partnership”) announced today that it has entered into an agreement (the “Third Waiver Extension Agreement”) with the lenders and administrative agent under its existing Credit Agreement to, among other things, extend the forbearance period as provided in the previously announced Second Waiver Extension Agreement, dated as of November 1, 2023, from its expiration date of November 17, 2023 to November 21, 2023 (the “New Expiration Date”). Pursuant to the Third Waiver Extension Agreement, the lenders and administrative agent have agreed to continue to forbear until the New Expiration Date from exercising any rights or remedies arising from certain events of default or prospective events of default described in the previously announced Fourth Amendment to Credit Agreement, First Waiver Extension Agreement and the Second Waiver Extension Agreement.

Additional details regarding the terms of the Third Waiver Extension Agreement will be provided in the Partnership’s related Current Report on Form 8-K that will be filed with the SEC.

About USD Partners LP

USD Partners LP is a fee-based, growth-oriented master limited partnership formed in 2014 by US Development Group, LLC (“USD”) to acquire, develop and operate midstream infrastructure and complementary logistics solutions for crude oil, biofuels and other energy-related products. The Partnership generates substantially all of its operating cash flows from multi-year, take-or-pay contracts with primarily investment grade customers, including major integrated oil companies, refiners and marketers. The Partnership’s principal assets include a network of crude oil terminals that facilitate the transportation of heavy crude oil from Western Canada to key demand centers across North America. The Partnership’s operations include railcar loading and unloading, storage and blending in on-site tanks, inbound and outbound pipeline connectivity, truck transloading, as well as other related logistics services. In addition, the Partnership provides customers with leased railcars and fleet services to facilitate the transportation of liquid hydrocarbons and biofuels by rail.

USD, which owns the general partner of USD Partners LP, is engaged in designing, developing, owning, and managing large-scale multi-modal logistics centers and energy-related infrastructure across North America. USD’s solutions create flexible market access for customers in significant growth areas and key demand centers, including Western Canada, the U.S. Gulf Coast and Mexico. Among other projects, USD is currently pursuing the development of a premier energy logistics terminal on the Houston Ship Channel with capacity for substantial tank storage, multiple docks (including barge and deepwater), inbound and outbound pipeline connectivity, as well as a rail terminal with unit train capabilities. For additional information, please visit texasdeepwater.com. Information on websites referenced in this release is not part of this release.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of U.S. federal securities laws, including statements with respect to the impact of the waiver extension agreement, future events relating

to our credit agreement, and the business prospects of the Partnership. Words and phrases such as “plans,” “will,” “could” and similar expressions are used to identify such forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements relating to the Partnership are based on management’s expectations, estimates and projections about the Partnership, its interests and the energy industry in general on the date this press release was issued. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include those as set forth under the heading “Risk Factors” in the Partnership’s most recent Annual Report on Form 10-K and in its subsequent filings with the Securities and Exchange Commission. The Partnership is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Relations Contacts:

Adam Altsuler

Executive Vice President, Chief Financial Officer

(281) 291-3995

aaltsuer@usdg.com

Jennifer Waller

Sr. Director, Financial Reporting and Investor Relations

(832) 991-8383

jwaller@usdg.com

Cover Page	Nov. 17, 2023
Cover [Abstract]
Document Type	8-K
Document Period End Date	Nov. 17, 2023
Entity Registrant Name	USD Partners LP
Entity Incorporation, State or Country Code	DE
Entity File Number	001-36674
Entity Tax Identification Number	30-0831007
Entity Address, Address Line One	811 Main Street
Entity Address, Address Line Two	Suite 2800
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77002
City Area Code	281
Local Phone Number	291-0510
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Units Representing Limited Partner Interests
Trading Symbol	USDP
Security Exchange Name	NYSE
Entity Emerging Growth Company	false
Entity Central Index Key	0001610682
Amendment Flag	false