Debt and Financing Obligations |
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| Debt and Financing Obligations | Note 6. Debt and Financing Obligations Credit Agreement As of September 30, 2026, certain subsidiaries of the Partnership, as borrowers, and the Partnership and certain of its subsidiaries, as guarantors, had a $1.8 billion senior secured credit facility (the “Credit Agreement”). As discussed below, on March 13, 2026, the total commitment under the Credit Agreement was increased from $1.5 billion to $1.8 billion, and on October 16, 2026 was decreased back to $1.5 billion. On March 13, 2026, the Partnership and the lenders under the Credit Agreement agreed to, pursuant to the terms of the Credit Agreement, (i) exercise the accordion feature included in the Credit Agreement, and (ii) increase the aggregate working capital interim commitments as provided in the Credit Agreement to $300.0 million for a period not to exceed 364 days, after which the aggregate working capital interim commitments will automatically be reduced to $0. As of September 30, 2026, there were two facilities under the Credit Agreement:
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 6.1% and 6.6% for the three months ended September 30, 2026 and 2025, respectively, and 6.0% and 6.6% for the nine months ended September 30, 2026 and 2025, 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. The table below presents the total borrowings and availability under the Credit Agreement (in thousands):
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 September 30, 2026. 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, 2025 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):
Twelfth Amendment to the Credit Agreement On October 16, 2026, the Partnership and certain of its subsidiaries entered into the twelfth amendment to the third amended and restated credit agreement and joinder which, among other things, (i) extended the maturity date from March 20, 2028 to October 16, 2031, (ii) reduced the aggregate working capital interim commitments, which were previously increased in March 2026 as provided in the credit agreement, from $300.0 million to $0 and (iii) maintained each of the $1.0 billion working capital revolving credit facility and the $500.0 million revolving credit facility. 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, 2025. Senior Notes The Partnership had 6.875% senior notes due 2029, 8.250% senior notes due 2032 and 7.125% senior notes due 2033 outstanding at September 30, 2026 and December 31, 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, 2025 for additional information on these senior notes. Financing Obligations The Partnership had financing obligations outstanding at September 30, 2026 and December 31, 2025 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, 2025 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 2026, the Partnership capitalized additional financing fees of $0.8 million in connection with the accordion exercise in March 2026. These expenses are included in interest expense in the accompanying consolidated statement of operations for the nine months ended September 30, 2026. The Partnership had unamortized deferred financing fees of $22.5 million and $27.7 million at September 30, 2026 and December 31, 2025, respectively. Unamortized fees related to the Credit Agreement are included in other current assets and other long-term assets and amounted to $7.1 million and $10.0 million at September 30, 2026 and December 31, 2025, 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 $15.1 million and $17.3 million at September 30, 2026 and December 31, 2025, 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 $0.3 million and $0.4 million at September 30, 2026 and December 31, 2025, respectively. Amortization expense of $2.0 million and $1.9 million for the three months ended September 30, 2026 and 2025, respectively, and $6.0 million and $5.6 million for the nine months ended September 30, 2026 and 2025, respectively is included in interest expense in the accompanying consolidated statements of operations. |
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