Note 6.    Debt and Financing Obligations

​

Credit Agreement

​

Certain subsidiaries of the Partnership, as borrowers, and the Partnership and certain of its subsidiaries, as guarantors, have a $1.50 billion senior secured credit facility (the “Credit Agreement”). The Credit Agreement matures on March 20, 2028.

​

On March 20, 2025, the Partnership and certain of its subsidiaries entered into the eleventh amendment to the third amended and restated credit agreement (the “Eleventh Amendment”) which, among other things, (i) extended the maturity date from May 2, 2026 to March 20, 2028, (ii) increased the working capital revolving credit facility from $950.0 million to $1.0 billion and (iii) decreased the revolving credit facility from $600.0 million to $500.0 million. All other material terms of the Credit Agreement remain substantially the same as disclosed in Note 9 of Notes to Consolidated Financial Statements in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2024.

​

As of June 30, 2025, there were two facilities under the Credit Agreement:

​

​

​

The Credit Agreement has an accordion feature whereby the Partnership may request on the same terms and conditions then applicable to the Credit Agreement, provided no Default (as defined in the Credit Agreement) then exists, an increase to the working capital revolving credit facility, the revolving credit facility, or both, by up to another $300.0 million, in the aggregate, for a total credit facility of up to $1.80 billion. Any such request for an increase must be in a minimum amount of $25.0 million. The Partnership cannot provide assurance, however, that its lending group and/or other lenders outside its lending group will agree to fund any request by the Partnership for additional amounts in excess of the total available commitments of $1.50 billion.

​

In addition, the Credit Agreement includes a swing line pursuant to which Bank of America, N.A., as the swing line lender, may make swing line loans in U.S. dollars in an aggregate amount equal to the lesser of (a) $100.0 million and (b) the Aggregate WC Commitments (as defined in the Credit Agreement). Swing line loans will bear interest at the Base Rate (as defined in the Credit Agreement). The swing line is a sub-portion of the working capital revolving credit facility and is not an addition to the total available commitments of $1.50 billion.

​

Availability under the working capital revolving credit facility is subject to a borrowing base which is redetermined from time to time and based on specific advance rates on eligible current assets. Availability under the borrowing base may be affected by events beyond the Partnership’s control, such as changes in petroleum product prices, collection cycles, counterparty performance, advance rates and limits and general economic conditions.

​

The average interest rates for the Credit Agreement were 6.7% and 7.6% for the three months ended June 30, 2025 and 2024, respectively, and 6.6% and 7.5% for the six months ended June 30, 2025 and 2024, respectively.

​

The Partnership classifies a portion of its working capital revolving credit facility as a current liability and a portion as a long-term liability. The portion classified as a long-term liability represents the amounts expected to be outstanding throughout the next twelve months based on an analysis of historical daily borrowings under the working capital revolving credit facility, the seasonality of borrowings, forecasted future working capital requirements and forward product curves, and because the Partnership has a multi-year, long-term commitment from its bank group. Accordingly, at June 30, 2025, the Partnership estimated working capital revolving credit facility borrowings will equal or exceed $100.0 million over the next twelve months.

​

The table below presents the total borrowings and availability under the Credit Agreement (in thousands):

​

​

The Credit Agreement also includes certain baskets, including: (i) a $35.0 million general secured indebtedness basket, (ii) a $30.0 million general investment basket, (iii) a $100.0 million secured indebtedness basket to permit the borrowers to enter into a Contango Facility (as defined in the Credit Agreement), (iv) a Sale/Leaseback Transaction (as defined in the Credit Agreement) basket of $150.0 million, and (v) a basket of $150.0 million in an aggregate amount for the purchase of common units of the Partnership, provided that, among other things, no Default exists or would occur immediately following such purchase(s).

​

The Credit Agreement imposes financial covenants that require the Partnership to maintain certain minimum working capital amounts, a minimum combined interest coverage ratio, a maximum senior secured leverage ratio and a maximum total leverage ratio. The Partnership was in compliance with the foregoing covenants at June 30, 2025.

​

Please read Note 9 of Notes to Consolidated Financial Statements in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional information on the Credit Agreement.

​

Supplemental cash flow information

​

The following table presents supplemental cash flow information related to the Credit Agreement for the periods presented (in thousands):

​

​

Senior Notes

​

The Partnership had 7.00% senior notes due 2027 (discussed below), 6.875% senior notes due 2029, 8.250% senior notes due 2032 and 7.125% senior notes due 2033 (discussed below) outstanding at June 30, 2025. Please read Note 9 of Notes to Consolidated Financial Statements in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional information on the 6.875% senior notes due 2029 and the 8.250% senior notes due 2032.

​

7.125% Senior Notes Due 2033

​

On June 23, 2025, the Issuers issued $450.0 million aggregate principal amount of 7.125% senior notes due 2033 to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to persons outside the United States pursuant to Regulation S under the Securities Act. The Partnership used the net proceeds from the offering to fund the purchase of a portion of the 2027 Notes in a cash tender offer and to repay a portion of the borrowings outstanding under its Credit Agreement.

​

On June 23, 2025, the Partnership redeemed $360 .3 million of the 2027 Notes, and the Issuers delivered a Notice of Full Redemption to Regions Bank, as trustee, for all of the outstanding 2027 Notes not purchased in the tender offer.

​

As a result of the redemption of $360.3 million of the 2027 Notes, the Partnership recorded a $2.8 million loss from early extinguishment of debt for each of the three and six months ended June 30, 2025, consisting of a $1.7 million non-cash write-off of a portion of the remaining unamortized original issue discount and a $1.1 million cash call premium.

​

On August 1, 2025, the Partnership redeemed the remaining portion of the 2027 Notes in the amount of $39.7 million, which is included in senior notes in the accompanying consolidated balance sheet at June 30, 2025, with available funds under its revolving credit facility.

​

2033 Notes Indenture

​

In connection with the issuance of the 2033 Notes on June 23, 2025, the Issuers and the subsidiary guarantors and Regions Bank, as trustee, entered into an indenture (the “2033 Notes Indenture”).

​

The 2033 Notes will mature on July 1, 2033 with interest accruing at a rate of 7.125% per annum. Interest is payable beginning January 1, 2026 and thereafter semi-annually in arrears on January 1 and July 1 of each year. The 2033 Notes are guaranteed on a joint and several senior unsecured basis by certain subsidiaries of the Partnership. Upon

a continuing event of default, the trustee or the holders of at least 25% in principal amount of the outstanding 2033 Notes may declare the 2033 Notes immediately due and payable, except that an event of default resulting from entry into a bankruptcy, insolvency or reorganization with respect to the Issuers, any restricted subsidiary of the Partnership that is a significant subsidiary or any group of its restricted subsidiaries that, taken together, would constitute a significant subsidiary of the Partnership, will automatically cause the outstanding 2033 Notes to become due and payable.

​

At any time prior to July 1, 2028, the Issuers have the option to redeem up to 35% of the 2033 Notes, in an amount not greater than the net cash proceeds of certain equity offerings, at a redemption price (expressed as a percentage of principal amount) of 107.125%, plus accrued and unpaid interest, if any, to the redemption date. The Issuers have the option to redeem all or part of the 2033 Notes at any time on or after July 1, 2028, at the redemption prices (expressed as percentages of principal amount) of 103.563% for the twelve-month period beginning July 1, 2028, 101.781% for the twelve-month period beginning July 1, 2029, and 100% beginning on July 1, 2030 and at any time thereafter, plus accrued and unpaid interest, if any, to the redemption date. In addition, prior to July 1, 2028, the Issuers may redeem all or part of the 2033 Notes at a redemption price equal to the sum of the principal amount thereof, plus a make whole premium, plus accrued and unpaid interest, if any, to the redemption date. The holders of the 2033 Notes may require the Issuers to repurchase the 2033 Notes following certain asset sales or a Change of Control Triggering Event (as defined in the 2033 Notes Indenture) at the prices and on the terms specified in the 2033 Notes Indenture.

​

The 2033 Notes Indenture contains covenants that limit the Partnership’s ability to, among other things, incur additional indebtedness and issue preferred securities, make certain dividends and distributions, make certain investments and other restricted payments, restrict distributions by its subsidiaries, create liens, sell assets or merge with other entities. Events of default under the 2033 Notes Indenture include, but are not limited to, (i) a default in payment of principal of, or interest or premium, if any, on, the 2033 Notes, (ii) breach of the Partnership’s covenants under the 2033 Notes Indenture, (iii) certain events of bankruptcy and insolvency, (iv) any payment default or acceleration of indebtedness of the Partnership or certain subsidiaries if the total amount of such indebtedness unpaid or accelerated exceeds $50.0 million and (v) failure to pay within 60 days uninsured final judgments exceeding $50.0 million.

​

Financing Obligations

​

The Partnership had financing obligations outstanding at June 30, 2025 and December 31, 2024 associated with historical sale-leaseback transactions that did not meet the criteria for sale accounting. Please read Note 9 of Notes to Consolidated Financial Statements in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional information on these financial obligations.

​

Deferred Financing Fees

​

The Partnership incurs bank fees related to its Credit Agreement and other financing arrangements. These deferred financing fees are capitalized and amortized over the life of the Credit Agreement or other financing arrangements. In 2025, the Partnership capitalized additional financing fees of $16.4 million, consisting of $8.6 million in connection with the issuance of the 2033 Notes and $7.8 million in connection with the Eleventh Amendment. These expenses are included in interest expense in the accompanying consolidated statement of operations for the six months ended June 30, 2025. The Partnership had unamortized deferred financing fees of $31.0 million and $19.9 million at June 30, 2025 and December 31, 2024, respectively.

​

Unamortized fees related to the Credit Agreement are included in other current assets and other long-term assets and amounted to $11.8 million and $6.2 million at June 30, 2025 and December 31, 2024, respectively. Unamortized fees related to the senior notes are presented as a direct deduction from the carrying amount of that debt liability and amounted to $18.8 million and $13.3 million at June 30, 2025 and December 31, 2024, respectively. Unamortized fees related to the Partnership’s sale-leaseback transactions are presented as a direct deduction from the carrying amount of the financing obligation and amounted to $0.4 million at both June 30, 2025 and December 31, 2024.

​

Amortization expense of approximately $1.8 million and $1.9 million for the three months ended June 30, 2025 and 2024, respectively, and $3.7 million and $3.7 million for the six months ended June 30, 2025 and 2024, respectively, is included in interest expense in the accompanying consolidated statements of operations.