Item 2. Unregistered Sales of Equity Securities
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
Recent Issuances of Unregistered Securities
Holders of our Series A Cumulative Convertible Preferred Units (“preferred units”) are entitled to receive cumulative quarterly distributions at a rate of 7.25% per annum. We may satisfy our obligation to pay distributions to the preferred unitholders through the issuance, in whole or in part, of additional preferred units (referred to as paid-in-kind or “PIK” distributions), with the remainder in cash, subject to certain rights of a holder to elect all cash and other conditions as described in our partnership agreement.
The Partnership made quarterly PIK distributions of 16,823 and 17,128 preferred units to OTA Holdings, Inc., an indirect, wholly owned subsidiary of the Partnership (“OTA”) in the first and second quarters of 2022, respectively. The preferred units held by OTA are accounted for as treasury units in consolidation. For additional information regarding the preferred units, see Note 8 of the Notes to Unaudited Condensed Consolidated Financial Statements included under Part I, Item 1 of this quarterly report.
The issuances of preferred units as PIK distributions during the three and six months ended June 30, 2022 were undertaken in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof.
Other than as described above, there were no sales of unregistered equity securities during the second quarter of 2022.
Issuer Purchases of Equity Securities
The following table summarizes our equity repurchase activity during the second quarter of 2022:
Period
Total Number
of Units
Purchased
Average
Price Paid
per Unit
Total
Number
Of Units
Purchased
as Part of
2019 Buyback
Program
Remaining
Dollar Amount
of Units
That May
Be Purchased
Under the 2019 Buyback
Program
($ thousands)
2019 Buyback Program: (1)
April 2022
–
$
–
–
$
1,519,128
May 2022
707,149
$
25.74
707,149
$
1,500,924
June 2022
700,972
$
24.17
700,972
$
1,483,983
Vesting of phantom unit awards:
April 2022
–
$
–
n/a
n/a
May 2022 (2)
71,976
$
25.74
n/a
n/a
June 2022 (3)
1,699
$
26.15
n/a
n/a
(1)
In January 2019, we announced the 2019 Buyback Program, which authorized the repurchase of up to $2 billion of EPD’s common units. Units repurchased under this program are cancelled immediately upon acquisition.
(2)
Of the 272,157 phantom unit awards that vested in May 2022 and converted to common units, 71,976 units were sold back to us by employees to cover related withholding tax requirements. These repurchases are not part of any announced program. We cancelled these units immediately upon acquisition.
(3)
Of the 5,875 phantom unit awards that vested in June 2022 and converted to common units, 1,699 units were sold back to us by employees to cover related withholding tax requirements. These repurchases are not part of any announced program. We cancelled these units immediately upon acquisition.
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ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.