Concurrently with the execution of the Merger Agreement, PBF Energy and PBF LLC, as the record and beneficial owner of 29,953,631 Common Units as of the date thereof, entered into a Voting and Support Agreement, dated as of the Signing Date, with PBFX (the “Support Agreement”), pursuant to which, among other things, PBF Energy agrees to cause PBF LLC, in its capacity as a limited partner of PBFX, to vote its Common Units in favor of the Merger Agreement and the transactions contemplated thereby, including the Merger.
The Merger Agreement contains customary representations and warranties from the parties, and each party has agreed to customary covenants, including, among others, covenants relating to (i) with respect to PBF Energy, PBFX and PBFX GP, the conduct of business during the interim period between the execution of the Merger Agreement and the effective time of the Merger and (ii) the obligation to use reasonable best efforts to cause the Merger to be consummated.
Completion of the Merger is subject to certain customary conditions, including, among others: (i) there being no law, injunction, judgment or ruling prohibiting consummation of the transactions contemplated under the Merger Agreement or making the consummation of the transactions contemplated thereby illegal; (ii) subject to specified materiality standards, the accuracy of certain representations and warranties of the parties as of the date of execution of the Merger Agreement and as of the closing date; (iii) compliance by the parties in all material respects with their covenants and obligations under the Merger Agreement; and (iv) approval of the Merger Agreement and the transactions contemplated thereby, including the Merger, by a majority of the Common Units (inclusive of the Common Units owned by PBF LLC). Additionally, in order to complete the Merger, PBF Energy and PBF LLC will file with the Securities and Exchange Commission (“SEC”) a Registration Statement on Form S-4, and the parties will file with the SEC other relevant documents, including a proxy statement and Schedule 13E-3. The SEC may review these documents and any review by the SEC may affect the timing of the completion of the Merger.
The Merger Agreement contains certain termination rights for both PBF Energy and PBFX, including, among others, (i) by PBF Energy or PBFX, if the Merger is not consummated by March 31, 2023, and (ii) by PBF Energy or PBFX, if the GP Board or the Conflicts Committee take certain actions with respect to its recommendation of the Merger prior to the partnership unitholder meeting. In the event of a termination as a result of actions with respect to the GP Board or Conflicts Committee recommendation, PBFX shall be obligated to pay PBF Energy a termination fee of $5 million. In the event of certain other terminations, a party will be obligated to pay the other party’s expenses subject to a cap of $10 million.
The closing of the transactions contemplated by the Merger Agreement are to occur on the second business day after the satisfaction or waiver of the conditions to the Merger provided in the Merger Agreement (other than the conditions that by their nature are to be satisfied at the closing of the Merger).
The foregoing description of the Merger and the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, a copy of which is attached hereto as Exhibit 2.1, and the terms of which are incorporated herein by reference. The foregoing description of the Support Agreement does not purport to be complete and is qualified in its entirety by reference to the Support Agreement, a copy of which is attached hereto as Exhibit 10.1, and the terms of which are incorporated herein by reference.
The Merger Agreement is attached hereto as Exhibit 2.1 and is incorporated into this Item 1.01 by reference. The foregoing summary has been included to provide investors and security holders with information regarding the terms of the Merger Agreement and is qualified in its entirety by the terms and conditions of the Merger Agreement. It is not intended to provide any other factual information about PBF Energy, PBF LLC, PBFX or their respective subsidiaries and affiliates. The Merger Agreement contains representations and warranties by each of the parties to the Merger Agreement that were made only for purposes of the Merger Agreement and as of specified dates. The representations, warranties and covenants in the Merger Agreement were made solely for the benefit of the parties to the Merger Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Merger Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of PBF Energy, PBF LLC, PBFX or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in PBF Energy’s, PBF LLC’s or PBFX’s public disclosures. The Merger Agreement should not be read alone, but should instead be read in conjunction with the other information regarding the companies and the Merger that will be contained in, or incorporated by reference into, the proxy statement/prospectus that the parties will be filing in connection with the Merger, as well as in the other filings that each of PBF Energy, PBF LLC and PBFX make with the SEC.
