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): February 20, 2014

 

CROSSTEX ENERGY, L.P.

(Exact name of registrant as specified in its charter)

 

 

 

Registrant’s telephone number, including area code:  (214) 953-9500

 

 

(Former name or former address, if changed since last report)

 

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 (see General Instruction A.2. below):

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 1.01.                                        Entry into a Material Definitive Agreement.

 

On February 20, 2014, Crosstex Energy, L.P. (the “Partnership”) entered into a Credit Agreement, dated as of February 20, 2014 (the “New Credit Agreement”), with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer thereunder, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents, Royal Bank of Canada and Bank of Montreal, as Co-Documentation Agents, and the other lenders party thereto.  A copy of the New Credit Agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K (this “Current Report”).

 

The New Credit Agreement permits the Partnership to borrow up to $1.0 billion on a revolving credit basis and includes a $500.0 million letter of credit subfacility.  The Partnership’s ability to borrow funds and obtain letters of credit under the new credit facility is conditioned upon, among other things, the closing of the transactions contemplated by the Contribution Agreement, dated as of October 21, 2013, by and among Devon Energy Corporation, Devon Gas Corporation, Devon Gas Services, L.P., Southwestern Gas Pipeline, Inc., the Partnership and Crosstex Energy Services, L.P., and the prior or concurrent termination of the Partnership’s existing credit facility.  The Partnership’s obligations under the New Credit Agreement are unsecured, and the Partnership’s subsidiaries are not required to guarantee the Partnership’s obligations under the New Credit Agreement.

 

The New Credit Agreement will mature on the fifth anniversary of the initial funding date, unless the Partnership requests, and the requisite lenders agree, to extend it pursuant to its terms.  The New Credit Agreement contains certain financial, operational and legal covenants.  Among other things, these covenants include maintaining a ratio of consolidated indebtedness to consolidated EBITDA (as defined in the New Credit Agreement, which definition includes projected EBITDA from certain capital expansion projects) of no more than 5.0 to 1.0.  If the Partnership consummates one or more acquisitions in which the aggregate purchase price is $50.0 million or more, the maximum allowed ratio of consolidated indebtedness to consolidated EBITDA will increase to 5.5 to 1.0 for the quarter of the acquisition and the three following quarters.

 

Borrowings under the New Credit Agreement bear interest at the Partnership’s option at the Eurodollar Rate (the LIBOR Rate) plus an applicable margin or the Base Rate (the highest of the Federal Funds Rate plus 0.50%, the 30-day Eurodollar Rate plus 1.0%, or the administrative agent’s prime rate) plus an applicable margin.  The applicable margins vary depending on the Partnership’s credit rating.  Upon breach by the Partnership of certain covenants governing the New Credit Agreement, amounts outstanding under the New Credit Agreement, if any, may become due and payable immediately.

 

The description set forth above is qualified in its entirety by the New Credit Agreement, which is filed as Exhibit 10.1 to this Current Report and is incorporated herein by reference.

 

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Item 2.03.                                        Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

The information provided in Item 1.01 of this Current Report is incorporated herein by reference.

 

Item 9.01.                                        Financial Statements and Exhibits.

 

(d)           Exhibits.

 

EXHIBIT  NUMBER				DESCRIPTION
10.1		—		Credit Agreement, dated as of February 20, 2014, by and among Crosstex Energy, L.P., Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer thereunder, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents, Royal Bank of Canada and Bank of Montreal, as Co-Documentation Agents, and the other lenders party thereto.

 

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SIGNATURES

 

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

 

	CROSSTEX ENERGY, L.P.
	By: Crosstex Energy GP, LLC, its General Partner
Date: February 21, 2014	By:	/s/ Michael J. Garberding
			Michael J. Garberding
			Executive Vice President and
			Chief Financial Officer

 

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INDEX TO EXHIBITS

 

EXHIBIT NUMBER				DESCRIPTION
10.1		—		Credit Agreement, dated as of February 20, 2014, by and among Crosstex Energy, L.P., Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer thereunder, Citibank, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents, Royal Bank of Canada and Bank of Montreal, as Co-Documentation Agents, and the other lenders party thereto.

 

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