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 to preferred unitholders in the first, second and third quarters of 2024 of 19,423, 19,865 and 20,225 preferred units, respectively. With the exception of 90 and 92 preferred units distributed in the second and third quarters of 2024, respectively, to an unaffiliated third party, all of the PIK distributions made during the nine months ended September 30, 2024 were to OTA Holdings, Inc., an indirect, wholly owned subsidiary of the Partnership (“OTA”). 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 issuance of preferred units as PIK distributions during the three and nine months ended September 30, 2024 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 third quarter of 2024.
Issuer Purchases of Equity Securities
The following table summarizes our equity repurchase activity during the third quarter of 2024:
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)
July 2024
–
$
–
–
$
1,001,709
August 2024
2,126,818
$
28.66
2,126,818
$
940,752
September 2024
519,533
$
28.95
519,533
$
925,709
Vesting of phantom unit awards:
August 2024 (2)
35,362
$
28.48
n/a
n/a
September 2024 (3)
1,284
$
29.29
n/a
n/a
(1)
In January 2019, we announced the 2019 Buyback Program, which authorized the repurchase of up to $2 billion of the Partnership’s common units. Units repurchased under this program are cancelled immediately upon acquisition.
(2)
Of the 129,147 phantom unit awards that vested in August 2024 and converted to common units, 35,362 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 4,250 phantom unit awards that vested in September 2024 and converted to common units, 1,284 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.