Free Writing Prospectus - Filing Under Securities Act Rules 163/433 (fwp)
November 13 2017 - 6:05AM
Edgar (US Regulatory)
Filed Pursuant to Rule 433
Registration No. 333-219196
November 9, 2017
Final
Term Sheet
300,000 9.50% Series A
Fixed-to-Floating
Rate Cumulative Redeemable Perpetual Preferred Units
(Liquidation Preference $1,000 per unit)
The information in this final term sheet supplements the preliminary prospectus supplement of Summit Midstream Partners, LP, dated November 6, 2017
(the Preliminary Prospectus Supplement), and supersedes the information in the Preliminary Prospectus Supplement to the extent it is inconsistent with the information in the Preliminary Prospectus Supplement. Terms used but not defined
herein have the meanings assigned to such terms in the Preliminary Prospectus Supplement.
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Issuer:
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Summit Midstream Partners, LP
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Security Ratings (Moodys / S&P)*:
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B3 / B-
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Trade Date:
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November 9, 2017
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Settlement Date:
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November 14, 2017 (T + 3)
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Title of Securities:
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9.50% Series A
Fixed-to-Floating
Rate Cumulative Redeemable Perpetual Preferred Units (the units).
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Number of Units:
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300,000 units.
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Public Offering Price:
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$1,000 per unit; $300,000,000 total.
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Use of Proceeds:
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The issuer expects to receive net proceeds of approximately $293 million from the sale of the units, after deducting underwriting discounts and estimated offering expenses. The issuer intends to use the net proceeds of this
offering to repay outstanding borrowings under its revolving credit facility.
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Maturity Date:
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Perpetual (unless redeemed on or after December 15, 2022 or in connection with a Change of Control Triggering Event or a Ratings Event).
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Liquidation Preference:
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$1,000 plus accumulated and unpaid distributions (subject to adjustment for any splits, combinations, or similar adjustment to the units).
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Distribution Payment Dates:
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Semi-annually in arrears on the 15th day of each June and December through and including December 15, 2022, and, thereafter, quarterly in arrears on the 15th day of March, June, September and December of each year (each a
Distribution Payment Date) to holders of record as of the close of business on the first Business Day of the month of the applicable Distribution Payment Date. A
pro-rated
initial distribution on
the units will be payable on December 15, 2017 in an amount equal to approximately $7.9167 per unit. If any Distribution Payment Date otherwise would fall on a day that is not a Business Day, declared distributions will be paid on the
immediately succeeding Business Day without the accumulation of additional distributions.
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Distribution Rate:
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The initial distribution rate for the units from and including the date of original issue to, but not including, December 15, 2022, will be 9.50% per annum of the $1,000 liquidation preference per unit (equal to $95 per
unit per annum). On and after December 15, 2022, distributions on the units will accumulate for each distribution period at a percentage of the liquidation preference equal to the three-month LIBOR plus a spread of 7.43%.
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Change of Control:
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If a Change of Control Triggering Event occurs, each holder of the units may require the issuer to repurchase all or a portion of such holders units at a purchase price equal to 101% of the liquidation preference plus an
amount equal to all
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accumulated and unpaid distributions thereon to, but not including, the date of settlement.
Any such redemption would be effected only out
of funds legally available for such
purpose and will be subject to compliance with the provisions of the issuers outstanding
indebtedness.
If the issuer fails to make a Change of Control Offer, to the extent required, or to
repurchase any of the units tendered by holders for repurchase as
required in connection
with a Change of Control Triggering Event, then, from and after the first date of such
failure and until such repurchase is made, the distribution rate for the outstanding units
will be 11.50% per annum (an increase
of 2.0% per annum) prior to December 15, 2022,
and on and after December 15, 2022, will accumulate for each distribution period at a
percentage of the liquidation preference equal to the three-month LIBOR plus a spread of
9.43%
(an increase of 2.0% per annum).
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Optional Redemption:
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At any time within 120 days after the conclusion of any review or appeal process instituted by the issuer following the occurrence of a
Ratings Event, the issuer may, at its option, redeem the units in whole, but not in part, at a redemption price in cash per unit equal to $1,020 (102% of the liquidation preference of $1,000) plus an amount equal to all accumulated and unpaid
distributions thereon to, but not including, the date fixed for redemption, whether or not declared. Any such redemption would be effected only out of funds legally available for such purpose and will be subject to compliance with the provisions of
the issuers outstanding indebtedness.
At any time on or after
December 15, 2022, the issuer may, at its option, redeem the units, in whole or in part, by paying the redemption price set forth below plus an amount equal to all accumulated and unpaid distributions thereon to, but not including, the date of
redemption, whether or not declared.
The redemption price shall be as follows
(assuming the units are redeemed during the
12-month
period beginning on December 15 of the years indicated below):
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Year
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Redemption Price
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2022
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104% of liquidation preference
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2023
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102% of liquidation preference
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2024 and thereafter
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100% of liquidation preference
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The issuer must provide not less than 30 days and not more than 60 days written notice of any such redemption. The issuer may undertake multiple partial redemptions. Any such redemption would be effected only out of
funds legally available for such purposes and will be subject to compliance with the provisions of the issuers outstanding indebtedness.
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CUSIP/ISIN:
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866142AA0 / US866142AA01
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Joint Book-Running Managers:
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Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Credit Suisse Securities (USA) LLC
Morgan Stanley & Co.
LLC
Wells Fargo Securities, LLC
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Senior
Co-Managers:
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BBVA Securities Inc.
BMO Capital Markets
Corp.
Deutsche Bank Securities Inc.
ING Financial Markets
LLC
RBC Capital Markets, LLC
Regions Securities LLC
TD Securities (USA) LLC
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Co-Managers:
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BB&T Capital Markets, a division of BB&T Securities, LLC
Capital One Securities, Inc.
Citigroup Global Markets Inc.
Citizens Capital Markets, Inc.
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Listing:
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The issuer does not intend to apply for the listing of the units on any securities exchange.
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Note: A securities rating is not a recommendation to buy, sell or hold securities and may be revised or withdrawn at any time.
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For the nine months ended September 30, 2017 and the year ended December 31, 2016 the issuers ratio of earnings to fixed charges, on a pro
forma basis giving effect to this offering, would have been 2.76x and 1.14x, respectively.
All information (including financial information) presented in
the Preliminary Prospectus Supplement is deemed to have changed to the extent affected by the changes described herein.
This communication is intended
for the sole use of the person to whom it is provided by the issuer. This communication does not constitute an offer to sell the units and is not soliciting an offer to buy the units in any jurisdiction where the offer or sale is not permitted.
It is expected that delivery of the units will be made to investors on or about November 14, 2017, which will be the third business day following the
date hereof (such settlement being referred to as T+3). Under Rule
15c6-1
under the Exchange Act, trades in the secondary market generally are required to settle in two business days, unless the
parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade the units on any date prior to the business day before delivery will be required to specify an alternate settlement cycle at the time of any such trade to
prevent a failed settlement. Purchasers of the units who wish to trade the units on any date prior to the business day before delivery should consult their own advisors.
The issuer has filed a registration statement (including a base prospectus) and a prospectus supplement with the U.S. Securities and Exchange Commission (the
SEC) for the offering to which this communication relates. Before you invest, you should read the prospectus supplement for this offering, the issuers prospectus in that registration statement and any other documents the issuer has
filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC web site at
www.sec.gov
. Alternatively, the issuer, any underwriter or any dealer
participating in the offering will arrange to send you the prospectus supplement and prospectus if you request it by calling Merrill Lynch, Pierce, Fenner & Smith Incorporated at
1-(800)
294-1322,
Credit Suisse Securities (USA) LLC at
1-(800)
221-1037,
Morgan Stanley & Co. LLC at
1-(866)-718-1649
or Wells Fargo Securities, LLC at
1-(800)
645-3751.
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