| ACQUISITIONS | ACQUISITIONS Third-Party Acquisitions Toledo Products Terminal Acquisition On April 17, 2017, the Partnership’s wholly-owned subsidiary, PLPT, completed the acquisition of the Toledo, Ohio refined products terminal assets from Sunoco Logistics Partners L.P. The Toledo Products Terminal is directly connected to, and currently supplied by, PBF Holding’s Toledo Refinery. The aggregate purchase price for the Toledo Products Terminal Acquisition was $10,000 , plus working capital. The consideration was funded in full with cash on hand. PBFX accounted for the Toledo Products Terminal Acquisition as a business combination under GAAP whereby the Partnership recognizes assets acquired and liabilities assumed at their estimated fair values as of the date of acquisition. The entire purchase consideration of $10,000 was allocated to Property, plant and equipment. Plains Asset Purchase On April 29, 2016, the Partnership’s wholly-owned subsidiary, PLPT, completed the acquisition of the East Coast Terminals (the “Plains Asset Purchase”). The East Coast Terminals, located in and around Philadelphia, Pennsylvania, include product tanks, pipeline connections to the Colonial Pipeline Company, Buckeye Partners, L.P., Sunoco Logistics Partners L.P. and other proprietary pipeline systems, truck loading lanes and marine facilities capable of handling barges and ships. The aggregate purchase price for the Plains Asset Purchase was $100,000 , less working capital adjustments. The consideration was funded by the Partnership with $98,336 in proceeds from the sale of marketable securities. The Partnership borrowed an additional $98,500 under its five -year, $360,000 senior secured revolving credit facility (the “Revolving Credit Facility”), which was used to repay $98,336 of its three -year, $300,000 term loan facility (the “Term Loan”) in order to release $98,336 in marketable securities that had collateralized the Term Loan. Subsequent to the closing of the Plains Asset Purchase, the Partnership recorded an adjustment to the preliminary estimate for working capital of $37 as an increase to Prepaids and other current assets. The final purchase price and fair value allocation were completed as of December 31, 2016. PBFX accounted for the Plains Asset Purchase as a business combination under U.S. GAAP whereby the Partnership recognizes assets acquired and liabilities assumed in an acquisition at their estimated fair values as of the date of acquisition. The total purchase consideration and the fair values of the assets and liabilities at the acquisition date were as follows: Purchase Price Gross purchase price $ 100,000 Working capital adjustments (1,627 ) Total consideration $ 98,373 The following table summarizes the final amounts recognized for assets acquired and liabilities assumed as of the acquisition date: Fair Value Allocation Prepaids and other current assets $ 4,221 Property, plant and equipment 99,342 Accounts payable and accrued expenses (3,174 ) Other long-term liabilities (2,016 ) Fair value of net assets acquired $ 98,373 The results of operations of the East Coast Terminals are included in the Partnership’s Consolidated Financial Statements for the full year ended December 31, 2017. The Partnership’s Consolidated Financial Statements for the year-ended December 31, 2016 include the results of operations of the East Coast Terminals since April 29, 2016 during which period the East Coast Terminals contributed affiliate revenue of $3,303 , third-party revenue of $11,871 and net income of $5,133 . On an unaudited pro forma basis, the revenues and net income of PBFX assuming the acquisition had occurred on January 1, 2015, are shown below. The unaudited pro forma information does not purport to present what PBFX’s actual results would have been had the Plains Asset Purchase occurred on January 1, 2015, nor is the financial information indicative of the results of future operations. The unaudited pro forma financial information includes the depreciation and amortization expense related to the acquisition and interest expense associated with the Plains Asset Purchase financing. Year Ended December 31, 2016 Year Ended (Unaudited) Pro forma revenues $ 195,800 $ 160,068 Pro forma net income attributable to the partners: 86,059 68,819 Pro forma net income per limited partner unit: Common units - basic $ 2.11 $ 1.84 Common units - diluted 2.11 1.84 Subordinated units - basic and diluted 2.11 1.84 Acquisitions from PBF The following Acquisitions from PBF are transactions between affiliate companies. As a result, these acquisitions were accounted for as a transfer of assets between entities under common control under GAAP. The assets and liabilities of the Acquisitions from PBF were transferred at their historical carrying value. Development Assets Acquisition On July 31, 2018, the Partnership closed the Development Assets Acquisition. Pursuant to the Development Assets Contribution Agreements, the Partnership acquired from PBF LLC all of the issued and outstanding limited liability company interests of TRLC, whose assets consist of the Toledo Rail Products Facility, CLC, whose assets consist of the Chalmette Truck Rack and the Chalmette Rosin Yard, PTC, whose assets consist of the Paulsboro Lube Oil Terminal, and DSLC, whose assets consist of the Delaware Ethanol Storage Facility. In connection with the Development Asset Acquisition, the Partnership entered into various commercial agreements with PBF Holding and assumed a commercial agreement with a third-party. The Development Assets Acquisition closed on July 31, 2018 for total consideration of $31,586 , consisting of 1,494,134 common units issued to PBF LLC. As the Development Assets Acquisition was considered a transfer of assets between entities under common control, TRLC’s, CLC’s, PTC’s and DSLC’s assets and liabilities were transferred at their historical carrying value. The financial information contained herein of PBFX has been retrospectively adjusted to include the historical results of the Development Assets, with the exception of the Delaware Ethanol Storage Facility which is considered an asset purchase, as if they were owned by the Partnership for all periods presented. Net loss attributable to the Development Assets Acquisition prior to the effective date was allocated entirely to PBF GP as if only PBF GP had rights to that net loss; therefore, there is no retrospective adjustment to net income per unit. The following tables present the Partnership’s statement of financial position and results of operations giving retrospective effect to the Development Assets Acquisition as of and for the periods presented. December 31, 2017 PBF Logistics Development Assets Consolidated ASSETS Current assets: Cash and cash equivalents $ 19,664 $ — $ 19,664 Accounts receivable - affiliates 40,817 — 40,817 Accounts receivable 1,423 — 1,423 Prepaids and other current assets 1,793 — 1,793 Total current assets 63,697 — 63,697 Property, plant and equipment, net 673,823 10,665 684,488 Other non-current assets 30 — 30 Total assets $ 737,550 $ 10,665 $ 748,215 LIABILITIES AND EQUITY Current liabilities: Accounts payable - affiliates $ 8,352 $ — $ 8,352 Accounts payable and accrued liabilities 19,794 — 19,794 Deferred revenue 1,438 — 1,438 Total current liabilities 29,584 — 29,584 Long-term debt 548,793 — 548,793 Other long-term liabilities 2,078 — 2,078 Total liabilities 580,455 — 580,455 Commitments and contingencies (Note 10) Equity: Net investment - Predecessor — 10,665 10,665 Common unitholders (17,544 ) — (17,544 ) IDR holder - PBF LLC 2,736 — 2,736 Total PBF Logistics LP equity (14,808 ) 10,665 (4,143 ) Noncontrolling interest 171,903 — 171,903 Total equity 157,095 10,665 167,760 Total liabilities and equity $ 737,550 $ 10,665 $ 748,215 December 31, 2016 PBF Logistics Development Assets Consolidated ASSETS Current assets: Cash and cash equivalents $ 64,221 $ — $ 64,221 Marketable securities - current 40,024 — 40,024 Accounts receivable - affiliates 37,863 — 37,863 Accounts receivable 4,294 — 4,294 Prepaids and other current assets 1,657 — 1,657 Total current assets 148,059 — 148,059 Property, plant and equipment, net 608,802 10,519 619,321 Other non-current assets — — — Total assets $ 756,861 $ 10,519 $ 767,380 LIABILITIES AND EQUITY Current liabilities: Accounts payable - affiliates $ 7,631 $ — $ 7,631 Accounts payable and accrued liabilities 20,871 — 20,871 Current portion of long-term debt 39,664 — 39,664 Deferred revenue 952 — 952 Total current liabilities 69,118 — 69,118 Long-term debt 532,011 — 532,011 Other long-term liabilities 3,161 — 3,161 Total liabilities 604,290 — 604,290 Commitments and contingencies (Note 10) Equity: Net investment - Predecessor 6,231 10,519 16,750 Common unitholders 241,275 — 241,275 Subordinated unitholder - PBF LLC (276,083 ) — (276,083 ) IDR holder - PBF LLC 1,266 — 1,266 Total PBF Logistics LP equity (27,311 ) 10,519 (16,792 ) Noncontrolling interest 179,882 — 179,882 Total equity 152,571 10,519 163,090 Total liabilities and equity $ 756,861 $ 10,519 $ 767,380 Year Ended December 31, 2017 PBF Logistics Development Assets Consolidated Results Revenue: Affiliate $ 240,654 $ — $ 240,654 Third-party 14,159 2,775 16,934 Total revenue 254,813 2,775 257,588 Costs and expenses: Operating and maintenance expenses 66,483 7,038 73,521 General and administrative expenses 16,284 — 16,284 Depreciation and amortization 23,831 573 24,404 Total costs and expenses 106,598 7,611 114,209 Income (loss) from operations 148,215 (4,836 ) 143,379 Other expense: Interest expense, net (31,875 ) — (31,875 ) Amortization of loan fees and debt premium (1,488 ) — (1,488 ) Net income (loss) 114,852 (4,836 ) 110,016 Less: Net loss attributable to Predecessor (150 ) (4,836 ) (4,986 ) Less: Net income attributable to noncontrolling interest 14,565 — 14,565 Net income attributable to the partners 100,437 — 100,437 Less: Net income attributable to the IDR holder 9,055 — 9,055 Net income attributable to PBF Logistics LP unitholders $ 91,382 $ — $ 91,382 Year Ended December 31, 2016 PBF Logistics Development Assets Consolidated Results Revenue: Affiliate $ 175,448 $ — $ 175,448 Third-party 11,887 1,671 13,558 Total revenue 187,335 1,671 189,006 Costs and expenses: Operating and maintenance expenses 44,563 6,830 51,393 General and administrative expenses 16,967 — 16,967 Depreciation and amortization 14,983 423 15,406 Total costs and expenses 76,513 7,253 83,766 Income (loss) from operations 110,822 (5,582 ) 105,240 Other expense: Interest expense, net (28,755 ) — (28,755 ) Amortization of loan fees (1,678 ) — (1,678 ) Net income (loss) 80,389 (5,582 ) 74,807 Less: Net loss attributable to Predecessor (6,250 ) (5,582 ) (11,832 ) Less: Net income attributable to noncontrolling interest 5,679 — 5,679 Net income attributable to the partners 80,960 — 80,960 Less: Net income attributable to the IDR holder 4,031 — 4,031 Net income attributable to PBF Logistics LP unitholders $ 76,929 $ — $ 76,929 Year Ended December 31, 2015 PBF Logistics Development Assets Consolidated Results Revenue: Affiliate $ 142,102 $ — $ 142,102 Third-party — 594 594 Total revenue 142,102 594 142,696 Costs and expenses: Operating and maintenance expenses 25,661 5,069 30,730 General and administrative expenses 13,898 — 13,898 Depreciation and amortization 7,684 122 7,806 Total costs and expenses 47,243 5,191 52,434 Income (loss) from operations 94,859 (4,597 ) 90,262 Other expense: Interest expense, net (19,939 ) — (19,939 ) Amortization of loan fees (1,315 ) — (1,315 ) Net income (loss) 73,605 (4,597 ) 69,008 Less: Net loss attributable to Predecessor (243 ) (4,597 ) (4,840 ) Less: Net income attributable to noncontrolling interest — — — Net income attributable to the partners 73,848 — 73,848 Less: Net income attributable to the IDR holder — — — Net income attributable to PBF Logistics LP unitholders $ 73,848 $ — $ 73,848 PNGPC Acquisition On February 28, 2017, the Partnership closed the PNGPC Acquisition, which had been contemplated by a contribution agreement dated as of February 15, 2017 between the Partnership and PBF LLC (the “PNGPC Contribution Agreement”). Pursuant to the PNGPC Contribution Agreement, the Partnership, through its wholly-owned subsidiary, PBFX Op Co, acquired from PBF LLC all of the issued and outstanding limited liability company interests of PNGPC, which owns and operates an existing interstate natural gas pipeline that serves PBF Holding’s Paulsboro Refinery and is subject to regulation by the FERC. In connection with the PNGPC Acquisition, the Partnership constructed the Paulsboro Natural Gas Pipeline to replace the existing pipeline, which commenced services in August 2017. In consideration for the PNGPC limited liability company interests, the Partnership delivered to PBF LLC (i) an $11,600 intercompany promissory note in favor of Paulsboro Refining Company LLC (“PRC”), a wholly-owned subsidiary of PBF Holding (the “Affiliate Note Payable”), (ii) an expansion rights and right of first refusal agreement in favor of PBF LLC with respect to the Paulsboro Natural Gas Pipeline and (iii) an assignment and assumption agreement with respect to certain outstanding litigation involving PNGPC and the existing pipeline. TVPC Acquisition On August 31, 2016, the Partnership entered into a contribution agreement with PBF LLC (the “Contribution Agreement V”). Pursuant to Contribution Agreement V, the Partnership, through its wholly-owned subsidiary, PBFX Op Co, acquired from PBF LLC 50% of the issued and outstanding limited liability company interests of TVPC, whose assets consist of the Torrance Valley Pipeline, which supports PBF Holding’s Torrance Refinery (the “TVPC Acquisition”). The Torrance Valley Pipeline consists of the M55, M1 and M70 pipeline systems, including pipeline stations with storage capacity and truck unloading capability. Total consideration paid to PBF LLC was $175,000 . The consideration was funded by the Partnership with $20,000 of cash on hand, $76,200 in proceeds from the sale of marketable securities and $78,800 in net proceeds from the August 2016 Equity Offering (as defined in Note 7 “Equity” of the Notes to Consolidated Financial Statements). The Partnership borrowed an additional $76,200 under its Revolving Credit Facility, which was used to repay $76,200 of its Term Loan in order to release $76,200 in marketable securities that had collateralized the Term Loan. Subsequent to the closing of the TVPC Acquisition, PBF LLC recorded adjustments to the preliminary estimate for the working capital acquired as part of the acquisition of the Torrance refinery and related logistics assets, of which $1,000 related to TVPC as a decrease to Other long-term liabilities. The final PBF LLC purchase price and fair value allocation was completed as of June 30, 2017. The following table summarizes the final amounts recognized for assets acquired and liabilities assumed as of the acquisition date: Fair Value Allocation Property, plant and equipment $ 350,475 Other long-term liabilities (475 ) Fair value of net assets acquired $ 350,000 The results of operations of TVPC are included in the Partnership’s Consolidated Financial Statements for the full year ended December 31, 2017. The Partnership’s Consolidated Financial Statements for the year-ended December 31, 2016 include the results of operations of TVPC since July 1, 2016, including the historical results prior to its acquisition on August 31, 2016, during which period TVPC contributed affiliate revenue of $24,717 and net income of $6,341 . On an unaudited pro forma basis, the revenues and net income of PBFX assuming the acquisition had occurred on January 1, 2015, are shown below. The unaudited pro forma information does not purport to present what PBFX’s actual results would have been had the TVPC Acquisition occurred on January 1, 2015, nor is the financial information indicative of the results of future operations. The unaudited pro forma financial information includes the depreciation and amortization expense related to the acquisition and interest expense associated with the TVPC Acquisition financing. Year Ended Year Ended (Unaudited) Pro forma revenues $ 236,723 $ 214,272 Pro forma net income attributable to the partners: 90,967 92,280 Pro forma net income per limited partner unit: Common units - basic $ 2.18 $ 2.38 Common units - diluted 2.18 2.38 Subordinated units - basic and diluted 2.18 2.38 DCR Products Pipeline and Truck Rack Acquisition On May 5, 2015, the Partnership entered into a contribution agreement between the Partnership and PBF LLC (the “Contribution Agreement IV”). Pursuant to the terms of the Contribution Agreement IV, PBF LLC contributed to the Partnership all of the issued and outstanding limited liability company interests of Delaware Pipeline Company LLC (“DPC”) and Delaware City Logistics Company LLC (“DCLC”), whose assets consist of a products pipeline, truck rack and related facilities located at PBF Energy’s Delaware City Refinery for total consideration payable to PBF LLC of $143,000 , consisting of $112,500 of cash and $30,500 of Partnership common units, or 1,288,420 common units (the “DCR Products Pipeline and Truck Rack Acquisition”). The cash consideration was funded by the Partnership with $88,000 in proceeds from the initial 2023 Notes (as defined in Note 5 “Debt” of the Notes to Consolidated Financial Statements), sale of approximately $700 in marketable securities and $23,800 in borrowings under the Partnership’s Revolving Credit Facility. The DCR Products Pipeline and Truck Rack Acquisition closed on May 15, 2015. The Partnership borrowed an additional $700 under its Revolving Credit Facility to repay $700 of its outstanding Term Loan in order to release the $700 in marketable securities that had collateralized PBFX’s Term Loan. As the Acquisitions from PBF were considered transfers of businesses between entities under common control, the PNGPC assets and liabilities were transferred at their historical carrying value, whose net value was $11,538 as of February 28, 2017. The TVPC assets and liabilities were transferred at their historical carrying value of $344,989 as of August 31, 2016, of which 50% was allocated to noncontrolling interest in equity (“NCI”). The DCR Products Pipeline and Truck Rack assets and liabilities were transferred at their historical carrying value of $15,975 on May 15, 2015. The historical financial statements have been retrospectively adjusted to reflect the financial position, results of operations and cash flows of PNGPC, TVPC and the DCR Products Pipeline and Truck Rack. Net income (loss) attributable to PNGPC, TVPC and the DCR Products Pipeline and Truck Rack prior to their respective effective dates were allocated entirely to PBF GP as if only PBF GP had rights to that net income (loss), therefore there is no retrospective adjustment to net income per unit. PBFX’s Consolidated Financial Statements include TVPC, a variable interest entity with the interest in TVPC not owned by PBFX reflected as a reduction to net income and equity as a noncontrolling interest. In accordance with the Amended and Restated Limited Liability Company Agreement of TVPC (the “TVPC LLC Agreement”), PBFX Op Co serves as TVPC’s managing member. PBFX, through its ownership of PBFX Op Co, has the sole ability to direct the activities of TVPC that most significantly impact its economic performance. PBFX is also considered to be the primary beneficiary for accounting purposes, and as a result, fully consolidates TVPC. TVPC provides transportation and storage services to PBF Holding, primarily under fee-based contracts. Acquisition Expenses PBFX incurred acquisition related costs of $533 for the year ended December 31, 2017, consisting primarily of consulting and legal expenses related to the PNGPC Acquisition, the Toledo Products Terminal Acquisition and other pending and non-consummated acquisitions. Acquisition related costs were $3,522 for the year ended December 31, 2016, consisting primarily of consulting and legal expenses related to the Plains Asset Purchase, the TVPC Acquisition and other pending and non-consummated acquisitions. Acquisition related costs were $830 for the year ended December 31, 2015, primarily related to the DCR Products Pipeline and Truck Rack acquisition. These costs are included in the consolidated income statement in general and administrative expenses. |
