Obligation Magellan Energy Partners 4.2% ( US559080AM85 ) en USD

Magellan Energy Partners

77.1129 % ⇌

Etats-unis

US559080AM85 ( en USD )

4.2% par an ( paiement semestriel )

03/10/2047

Prospectus brochure de l'obligation Magellan Midstream Partners US559080AM85 en USD 4.2%, échéance 03/10/2047

559080AM8

BBB ( Qualité moyenne inférieure )

Baa2 ( Qualité moyenne inférieure )

03/10/2026 ( Dans 181 jours )

Magellan Midstream Partners, L.P. est une société américaine de partenariat à responsabilité limitée qui possède et exploite un vaste réseau d'infrastructures énergétiques, incluant des pipelines de transport de pétrole brut, de produits raffinés et de gaz naturel, ainsi que des terminaux de stockage.

L'Obligation émise par Magellan Energy Partners ( Etats-unis ) , en USD, avec le code ISIN US559080AM85, paye un coupon de 4.2% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 03/10/2047

L'Obligation émise par Magellan Energy Partners ( Etats-unis ) , en USD, avec le code ISIN US559080AM85, a été notée Baa2 ( Qualité moyenne inférieure ) par l'agence de notation Moody's.

L'Obligation émise par Magellan Energy Partners ( Etats-unis ) , en USD, avec le code ISIN US559080AM85, a été notée BBB ( Qualité moyenne inférieure ) par l'agence de notation Standard & Poor's ( S&P ).

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424B2 1 d450827d424b2.htm 424B2
Table of Contents
Filed Pursuant to Rule 424(b)(2)
Registration No. 333-203869
CALCULATION OF REGISTRATION FEE

Proposed
Maximum
Title of Each Class of
Aggregate
Securities to be Registered

Offering Price
Registration Fee(1)
4.200% Senior Notes Due 2047

$500,000,000

$57,950

(1)
The filing fee, calculated in accordance with Rule 457(r), has been transmitted to the SEC in connection with the securities offered from
Registration Statement File No. 333-203869 by means of this prospectus supplement.
Table of Contents

Prospectus supplement
To prospectus dated May 5, 2015

$500,000,000 4.200% Senior Notes due 2047
This is an offering by Magellan Midstream Partners, L.P. of $500 million aggregate principal amount of 4.200% Senior Notes due 2047. Interest
will be payable on the notes semi-annually in arrears on April 3 and October 3 of each year. The notes will mature on October 3, 2047. Interest on
the notes will accrue from October 3, 2017, and the first interest payment on the notes will be due on April 3, 2018.
We may redeem some or all of the notes at any time or from time to time at the applicable redemption price described in this prospectus
supplement under the caption "Description of notes--Optional redemption ."
The notes will be our senior unsecured obligations and will rank equally with all of our existing and future unsecured senior debt, including
borrowings under our revolving credit facilities and commercial paper program, and senior to any future subordinated debt that we may incur.
Investing in the notes involves risks that are described in the "Risk factors" section beginning on page S-9 of
this prospectus supplement and on page 3 of the accompanying base prospectus, as well as the risk factors
discussed in our Annual Report on Form 10-K for the year ended December 31, 2016.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus supplement or the accompanying base prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.

Proceeds, before
Public offering
Underwriting
expenses, to

price(1)

discount

Magellan(1)

Per note

99.341%

0.875%

98.466%
Total

$496,705,000
$ 4,375,000
$ 492,330,000

(1)
Plus accrued interest from October 3, 2017, if settlement occurs after that date.
The notes are a new issue of securities with no established trading market. We do not currently intend to apply for listing of the notes on any
securities exchange or to be quoted on any automated quotation system.
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The notes will be ready for delivery in book-entry form only through the facilities of The Depository Trust Company for the accounts of its
participants on or about October 3, 2017.
Joint book-running managers

Barclays

SunTrust Robinson Humphrey

Wells Fargo Securities
Citigroup

PNC Capital Markets LLC

SMBC Nikko
Co-Managers

J.P. Morgan
Mizuho Securities

RBC Capital Markets
US Bancorp
The date of this prospectus supplement is September 26, 2017.

Table of Contents
Table of contents
Prospectus supplement

Page
About this prospectus supplement
S-ii
Summary
S-1
Risk factors
S-9
Ratio of earnings to fixed charges
S-12
Use of proceeds
S-13
Capitalization
S-14
Description of notes
S-15
Certain United States federal income tax considerations
S-31
Underwriting
S-35
Legal
S-40
Experts
S-40
Information regarding forward-looking statements
S-41
Where you can find more information
S-44
Prospectus

Page
About this prospectus

1
Magellan Midstream Partners, L.P.

2
Risk factors

3
Information regarding forward-looking statements

4
Ratio of earnings to fixed charges

7
Use of proceeds

7
Description of our debt securities

8
Description of our common units

18
Cash distributions

20
Description of our partnership agreement

22
Material tax considerations

29
Tax consequences of ownership of debt securities

45
Investment by U.S. employee benefit plan

46
Legal matters

48
Experts

48
Where you can find more information

48
Incorporation of certain information by reference

48

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S-i
Table of Contents
About this prospectus supplement
This document is in two parts. The first part is this prospectus supplement, which describes the terms of this offering of notes. The second part is
the accompanying base prospectus, which gives more general information about the securities we may offer from time to time. Generally when we
refer only to the "prospectus," we are referring to both parts combined.
If the information about the offering varies between this prospectus supplement and the accompanying base prospectus, you should rely on the
information in this prospectus supplement.
You should rely only on the information contained or incorporated by reference in this prospectus supplement, the accompanying base prospectus
and any free writing prospectus filed by us with the Securities and Exchange Commission (the "SEC"). Neither we nor the underwriters have
authorized anyone to provide you with different or additional information. We and the underwriters are not making an offer of these securities in
any jurisdiction where the offer is not permitted. You should not assume that the information contained in this prospectus supplement, the
accompanying base prospectus and any free writing prospectus is accurate as of any date other than the dates shown in those documents or that any
information we have incorporated by reference is accurate as of any date other than the date of the document incorporated by reference. Our
business, financial condition, results of operations and prospects may have changed since such dates.
None of Magellan Midstream Partners, L.P., the underwriters or any of their respective representatives is making any representation to you
regarding the legality of an investment in the notes by you under applicable laws. You should consult with your own advisors as to legal, tax,
business, financial and related aspects of an investment in the notes.
As used in this prospectus supplement and the accompanying base prospectus, unless we indicate otherwise, the terms "our," "we," "us" and
similar terms refer to Magellan Midstream Partners, L.P., together with its subsidiaries.

S-ii
Table of Contents
Summary
This summary highlights information contained elsewhere in this prospectus supplement and the accompanying base prospectus. It does not
contain all of the information that you should consider before making an investment decision. You should read the entire prospectus
supplement, the accompanying base prospectus, the documents incorporated by reference and the other documents to which we refer for a
more complete understanding of this offering. Please read "Risk factors" beginning on page S-9 of this prospectus supplement and on page 3
of the accompanying base prospectus, as well as the risk factors discussed in our Annual Report on Form 10-K for the year ended
December 31, 2016 for more information about important factors that you should consider before purchasing notes in this offering.
Magellan Midstream Partners, L.P.
We were formed as a limited partnership under the laws of the State of Delaware in August 2000 to own, operate and acquire a diversified
portfolio of complementary energy assets. We are principally engaged in the transportation, storage and distribution of refined petroleum
products and crude oil. As of June 30, 2017, our three operating segments included:

· our refined products segment, comprised of our 9,700-mile refined products pipeline system with 53 terminals as well as 26 independent

terminals not connected to our pipeline system and our 1,100-mile ammonia pipeline system;

· our crude oil segment, comprised of approximately 2,200 miles of crude oil pipelines, our condensate splitter and storage facilities with

an aggregate storage capacity of approximately 27 million barrels, of which 17 million barrels are used for contract storage; and

· our marine storage segment, consisting of five marine terminals located along coastal waterways with an aggregate storage capacity of

approximately 26 million barrels.
Our principal executive offices are located in One Williams Center, Tulsa, Oklahoma 74172 and our phone number is (918) 574-7000.
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Partnership structure and management
Our operations are conducted through, and our operating assets are owned by, our subsidiaries. Our general partner, which is also a wholly
owned subsidiary, has sole responsibility for conducting our business and managing our operations. Our general partner has a non-economic
general partner interest in us and does not receive a management fee or other compensation in connection with its management of our
business.
The following table describes our current ownership structure. The percentages reflected in the table, other than the general partner interest,
represent approximate ownership interests in us.

Percentage
Ownership of Magellan Midstream Partners, L.P.

interest
Public common units

99.8%
Officer and director common units

0.2%
General partner interest

0.0%

Total

100.0%

S-1
Table of Contents
The offering

Issuer
Magellan Midstream Partners, L.P.

Securities
$500 million aggregate principal amount of 4.200% Senior Notes due 2047.

Maturity date
October 3, 2047.

Interest payment dates
Interest will be payable on the notes semi-annually in arrears on April 3 and October 3
of each year, beginning April 3, 2018.

Interest on the notes will accrue from October 3, 2017.

Use of proceeds
We intend to use the net proceeds from this offering to repay borrowings outstanding
under our commercial paper program. The remaining net proceeds will be used for
general partnership purposes, which may include capital expenditures.

Affiliates of certain of the underwriters participating in this offering are participants in
our commercial paper program and may receive a portion of the net proceeds of this

offering through our repayment of the indebtedness outstanding under our commercial
paper program with such proceeds. Please see "Use of proceeds" on page S-13.

Optional redemption
We may redeem some or all of the notes at any time or from time to time prior to
maturity. If we elect to redeem the notes prior to April 3, 2047 (the date that is six
months prior to the maturity date of the notes the "Par Call Date")), we will pay an
amount equal to the greater of 100% of the principal amount of the notes to be
redeemed or the sum of the present values of the remaining scheduled payments of
principal and interest on the notes that would be due if the notes matured on the Par Call
Date, but for the redemption, plus a make-whole premium.

On or after the Par Call Date, we will pay an amount equal to 100% of the principal
amount of the notes to be redeemed. We will pay accrued and unpaid interest, if any, on

the notes redeemed to, but excluding, the redemption date. See "Description of notes--
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Optional redemption."

Subsidiary guarantees
Our subsidiaries will not initially guarantee the notes. In the future, however, we will
cause any of our subsidiaries that subsequently guarantee or become a co-obligor in
respect of any of our funded debt to equally and ratably guarantee the notes offered
hereby.

Ranking
The notes will be our senior unsecured obligations and will rank equally with all of our
other existing and future unsecured senior debt, including borrowings under our
revolving credit facilities and commercial paper program, and senior to any future
subordinated debt that we may incur.

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Table of Contents
We conduct substantially all of our business through our subsidiaries. The notes will be
structurally subordinated to all existing and future debt and other liabilities, including

trade payables, of any of our non-guarantor subsidiaries. As of June 30, 2017, our
subsidiaries had no debt for borrowed money.

Certain covenants
We will issue the notes under an indenture, with U.S. Bank National Association, as
trustee. The indenture does not limit the amount of unsecured debt we may incur. The
indenture contains limitations on, among other things, our ability to:

· incur debt secured by certain liens;

· engage in certain sale-leaseback transactions; and

· consolidate, merge or dispose of all or substantially all of our assets.

Additional issuances
We may, at any time, without the consent of the holders of the notes, issue additional
notes having the same interest rate, maturity and other terms as the notes offered hereby
(except for the issue date, the public offering price and, if applicable, the first interest
payment date). Any additional notes having such similar terms, together with the notes
offered hereby, will constitute a single series under the indenture.

Risk factors
Please read "Risk factors" beginning on page S-9 of this prospectus supplement and on
page 3 of the accompanying base prospectus, as well as the risk factors discussed in our
Annual Report on Form 10-K for the year ended December 31, 2016, for a discussion
of factors you should carefully consider before investing in the notes.

Governing law
The notes and the indenture governing the notes will be governed by the laws of the
State of New York.

S-3
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Summary financial and operating data
The following table sets forth our summary financial and operating data as of and for the years ended December 31, 2014, 2015 and 2016 and
as of June 30, 2017 and for the six months ended June 30, 2016 and 2017. This financial data was derived from our audited consolidated
financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2016 and from our
unaudited consolidated financial statements and related notes included in our Quarterly Report on Form 10-Q for the six months ended
June 30, 2017. The financial data set forth below should be read in conjunction with those consolidated financial statements and the notes
thereto, which are incorporated by reference into this prospectus supplement and the accompanying base prospectus and have been filed with
the SEC. The other data and operating statistics have been derived from our financial records.
We believe that investors benefit from having access to the same financial measures utilized by management. In the following tables, we
present the financial measure of distributable cash flow, which is not prepared in accordance with generally accepted accounting principles
("GAAP"). Our partnership agreement requires that all of our available cash, less amounts reserved by our general partner's board of
directors, be distributed to our limited partners on a quarterly basis. Management uses distributable cash flow to determine the amount of cash
our operations generated that is available for distribution to our limited partners (before any reserves established by our general partner's
board of directors) and for recommending to our general partner's board of directors the amount of cash distributions to be paid each period.
We also use distributable cash flow as the basis for calculating our equity-based incentive pay. A reconciliation of distributable cash flow to
net income, the nearest comparable GAAP measure, is included in the following tables.
In addition to distributable cash flow, the non-GAAP measures of operating margin (in the aggregate and by segment) and adjusted EBITDA
are presented in the following tables. We compute the components of operating margin and adjusted EBITDA using amounts that are
determined in accordance with GAAP. Reconciliations of operating margin to operating profit and adjusted EBITDA to net income, which are
the nearest comparable GAAP financial measures, are included in the following tables. Reconciliations of segment operating margin to
segment operating profit are included in our Annual Report on Form 10-K for the year ended December 31, 2016 and our Quarterly Report on
Form 10-Q for the period ended June 30, 2017. Operating margin is an important measure of the economic performance of our core
operations. Operating profit, alternatively, includes depreciation and amortization expense and general and administrative expense that
management does not consider when evaluating the core profitability of an operation. Adjusted EBITDA is an important measure utilized by
management and the investment community to assess the financial results of an entity.

S-4
Table of Contents
Since the non-GAAP measures presented here include adjustments specific to us, they may not be comparable to similarly-titled measures of
other companies.

Year ended December 31,

Six months ended June 30,
(dollars in thousands, except per unit amounts)

2014

2015

2016

2016

2017

Income statement data:

Transportation and terminals revenue

$1,459,267
$1,544,746
$1,591,119
$ 762,315
$ 825,910
Product sales revenue

878,974

629,836

599,602

270,251

427,624
Affiliate management fee revenue

22,111

13,871

14,689

6,147

7,980

Total revenue

2,360,352
2,188,453
2,205,410
1,038,713
1,261,514
Operating expenses

499,053

523,650

528,672

257,096

276,886
Cost of product sales

594,585

447,273

493,338

209,288

318,851
Earnings of non-controlled entities

(19,394)

(66,483)

(78,696)

(32,967)

(47,022)

Operating margin

1,286,108
1,284,013
1,262,096

605,296

712,799
Depreciation and amortization expense

161,741

166,812

178,142

87,056

96,194
General and administrative expense

147,203

149,948

147,165

75,230

83,674

Operating profit

977,164

967,253

936,789

443,010

532,931
Interest expense, net

121,519

143,177

165,410

78,379

94,830
Gain on exchange of interest in non-controlled entity

--

--

(28,144)

(28,144)

--
Other expense (income)(a)

11,506

2,618

(6,466)

(3,710)

3,213

Income before provision for income taxes

844,139

821,458

805,989

396,485

434,888
Provision for income taxes

4,620

2,336

3,218

1,556

1,752

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Net income

$ 839,519
$ 819,122
$ 802,771
$ 394,929
$ 433,136

Basic net income per limited partner unit

$
3.69
$
3.60
$
3.52
$
1.73
$
1.90

Diluted net income per limited partner unit

$
3.69
$
3.59
$
3.52
$
1.73
$
1.90

Balance sheet data:

Working capital deficit(b)

$ (133,488)
$ (374,218)
$ (111,262)

$ (130,919)
Total assets

$5,501,409
$6,041,567
$6,772,073

$6,930,722
Long-term debt, net

$2,967,019
$3,189,287
$4,087,192

$4,231,912
Partners' capital

$1,868,233
$2,021,736
$2,092,105

$2,134,269
Cash distribution data:

Cash distributions declared per unit(c)

$
2.62
$
3.01
$
3.32
$
1.62
$
1.76
Cash distributions paid per unit(c)

$
2.51
$
2.92
$
3.25
$
1.59
$
1.73
(Footnotes appear on page S-7)

S-5
Table of Contents

Year ended December 31,

Six months ended June 30,
(dollars in thousands)

2014

2015

2016

2016
2017
Other data:

Operating margin:

Refined products

$ 871,492
$ 778,515
$ 723,588
$ 348,408
$ 435,749
Crude oil

296,132

381,819

408,327
197,701

207,754
Marine storage

114,971

119,828

125,226

56,832

66,665
Allocated partnership depreciation costs(d)

3,513

3,851

4,955

2,355

2,631

Operating margin

$1,286,108
$1,284,013
$1,262,096
$ 605,296
$ 712,799

Adjusted EBITDA and distributable cash flow:

Net income

$ 839,519
$ 819,122
$ 802,771
$ 394,929
$ 433,136
Interest expense, net(e)

121,519

143,177

165,410

78,379

94,830
Depreciation and amortization expense

161,741

166,812

178,142

87,056

96,194
Equity-based incentive compensation expense(f)

12,471

6,461

4,982

(4,317)

(3,158)
Loss on sale and retirement of assets

7,223

7,871

11,190

3,263

5,331
Gain on exchange of interest in non-controlled
entity(g)

--

--

(28,144)

(28,144)

--
Commodity-related adjustments(h)

(56,288)

13,988

64,257

28,855

(27,882)
Cash distributions received from non-controlled
entities in excess of (less than) earnings for the
period

(8,724)

14,572

9,293

55

10,884
Other(i)

--

--

5,341

2,576

2,900

Adjusted EBITDA

1,077,461
1,172,003
1,213,242
562,652

612,235
Interest expense, net, excluding debt issuance cost
amortization(e)

(119,186)
(140,464)
(162,251)

(76,858)

(93,176)
Maintenance capital(j)

(77,806)

(88,685)
(103,507)

(59,446)

(41,095)

Distributable cash flow

$ 880,469
$ 942,854
$ 947,484
$ 426,348
$ 477,964

(Footnotes appear on page S-7)

S-6
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Table of Contents
Six months ended

Year ended December 31,

June 30,

2014
2015
2016
2016
2017
Operating statistics:

Refined products:

Transportation revenue per barrel shipped

$1.399
$1.439
$1.473
$1.422
$1.472
Volume shipped (million barrels):

Gasoline

256.1
268.1
275.4
132.2
142.9
Distillates

163.1
152.5
150.2
72.7
78.6
Aviation fuel

23.0
21.2
25.7
12.4
13.5
Liquefied petroleum gases

9.9

9.7
10.4

5.8

5.7

Total volume shipped

452.1
451.5
461.7
223.1
240.7
Crude oil:

Magellan 100%-owned assets:

Transportation revenue per barrel shipped

$1.192
$1.118
$1.321
$1.403
$1.456
Volume shipped (million barrels)

185.5
209.9
187.0
88.8
88.6
Crude oil terminal average utilization (million barrels per month)

12.2
13.1
15.0
14.6
15.9
Select joint venture pipelines:

BridgeTex--volume shipped (million barrels)(k)

18.3
75.2
79.0
38.1
40.7
Saddlehorn--volume shipped (million barrels)(l)

--

--

5.2

--

7.7
Marine storage:

Marine terminal average utilization (million barrels per month)

22.9
24.0
23.8
23.2
24.0

(a)
Other expense (income) includes the non-cash impact of the change in the differential between the current spot price and forward price
on fair value hedges associated with our tank bottom assets, as well as pension costs other than service costs. Additionally, other income
for 2016 includes a break-up fee related to a potential acquisition.
(b)
Working capital deficit at December 31, 2015 and June 30, 2016 included the current portion of long-term debt of approximately $250.0
million.
(c)
Cash distributions declared were determined based on the distributable cash flow generated for each calendar year. Distributions were
declared and paid within 45 days following the close of each quarter. Cash distributions paid represent cash payments for distributions
during each of the periods presented.
(d)
Certain depreciation expense was allocated to our various business segments, which in turn recognized these allocated costs as operating
expense, reducing segment operating margin by these amounts.
(e)
For the purpose of calculating distributable cash flow, we have excluded debt issuance cost amortization from interest expense.
(f)
Equity-based incentive compensation expense excludes the tax withholdings on settlement of equity-based incentive awards, which were
paid in cash.
(g)
In February 2016, we transferred our 50% membership interest in Osage Pipe Line Company, LLC ("Osage") to an affiliate of
HollyFrontier Corporation ("HFC"). In conjunction with this transaction, we entered into several commercial agreements with affiliates
of HFC, which were recorded as intangible assets and other receivables on our consolidated balance sheets. We recorded a $28.1 million
non-cash gain in relation to this transaction.
(h)
Certain derivatives we use as economic hedges have not been designated as hedges for accounting purposes and the mark-to-market
changes of these derivatives are recognized currently in earnings. In addition, we have designated certain derivatives we use to hedge
our crude oil tank bottoms as fair value hedges and the change in the differential between the current spot price and forward price on
these hedges is recognized currently in earnings. We exclude the net impact of both of these adjustments from our determination of

S-7
Table of Contents
distributable cash flow until the hedged products are physically sold. In the period in which these hedged products are physically sold,

the net impact of the associated hedges is included in our determination of distributable cash flow.
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(i)
Other adjustments in 2016 include certain payments received from HFC in conjunction with the transfer of our 50% membership
interest in Osage in February 2016. HFC agreed to make certain payments to us until HFC completes a connection to our El Paso
terminal. These payments replace distributions we would have received had the Osage transaction not occurred and are, therefore,
included in our calculation of distributable cash flow.
(j)
Maintenance capital expenditure projects maintain our existing assets and do not generate incremental distributable cash flow (i.e.
incremental returns to our unitholders). For this reason, we deduct maintenance capital expenditures to determine distributable cash
flow.
(k)
These volumes reflect the total shipments for the BridgeTex pipeline, which is owned 50% by us and began operations in September
2014.
(l)
These volumes reflect the total shipments for the Saddlehorn pipeline, which is owned 40% by us and began operations in September
2016.

S-8
Table of Contents
Risk factors
An investment in our notes involves risk. You should carefully read the risk factors set forth below, the risk factors included under the caption
"Risk factors" beginning on page 3 of the accompanying base prospectus, and the risk factors discussed in our Annual Report on Form 10-K for
the year ended December 31, 2016, which is incorporated by reference into this prospectus supplement and the accompanying base prospectus.
Risks related to the notes
Your ability to transfer the notes at a time or price you desire may be limited by the absence of an active trading market, which may not
develop.
The notes are a new issue of securities with no established trading market. Although we have registered the offer and sale of the notes under the
Securities Act of 1933, as amended (the "Securities Act"), we do not intend to apply for listing of the notes on any securities exchange or for
quotation of the notes in any automated dealer quotation system. In addition, although the underwriters have informed us that they intend to make a
market in the notes as permitted by applicable laws and regulations, they are not obligated to make a market in the notes, and they may discontinue
their market-making activities at any time without notice. An active market for the notes may not develop or, if developed, may not continue. In
the absence of an active trading market, you may not be able to transfer the notes within the time or at the price you desire.
The notes will be our senior unsecured obligations. As such, the notes will be effectively junior to any secured debt we may incur in the future
and to the future secured debt of any subsidiaries that guarantee the notes and structurally junior to the existing and future debt and other
liabilities of our subsidiaries that do not guarantee the notes.
The notes will be our senior unsecured debt and will rank equally in right of payment with all of our other existing and future unsubordinated debt,
including borrowings under our revolving credit facility, our 364-day revolving credit facility and commercial paper program. The notes will be
effectively junior to any secured debt we may incur in the future (to the extent of the value of the collateral securing the indebtedness) and to the
future secured debt of any subsidiaries that guarantee the notes (to the extent of the value of the collateral securing the indebtedness) and
structurally junior to the existing and future debt and other liabilities, including trade payables, of our subsidiaries that do not guarantee the notes.
As of June 30, 2017, our subsidiaries had no debt for borrowed money owing to any unaffiliated third parties. Initially, there will be no subsidiary
guarantors of the notes, and there may be none in the future.
If we are involved in any dissolution, liquidation or reorganization, any secured debt holders would be paid before you receive any amounts due
under the notes to the extent of the value of the assets securing their debt and creditors of our subsidiaries may also be paid before you receive any
amounts due under the notes. In that event, you may not be able to recover any principal or interest you are due under the notes.
A guarantee could be voided if the guarantee was held to be a fraudulent transfer at the time the indebtedness evidenced by the guarantee was
incurred, which could result in the noteholders being able to rely only on us to satisfy claims.
Initially, none of our subsidiaries will guarantee the notes. In the future, however, if our subsidiaries become guarantors or co-obligors of our
funded debt, then these subsidiaries will guarantee our payment obligations under the notes. Under U.S. bankruptcy law and comparable provisions
of state fraudulent transfer laws, a guarantee can be voided, or claims under a guarantee may be subordinated to all other debts of that guarantor if,
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among other things, the guarantor, at the time it incurred the indebtedness evidenced by its guarantee:

· intended to hinder, delay or defraud any present or future creditor or received less than reasonably equivalent value or fair consideration for

the incurrence of the guarantee;

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· was insolvent or rendered insolvent by reason of such incurrence;

· was engaged in a business or transaction for which the guarantor's remaining assets constituted unreasonably small capital; or

· intended to incur, or believed that it would incur, debts beyond its ability to pay those debts as they mature.
In addition, any payment by that guarantor under a guarantee could be voided and required to be returned to the guarantor or to a fund for the
benefit of the creditors of the guarantor.
We do not have the same flexibility as other types of organizations to accumulate cash, which may limit cash available to service the notes or to
repay them at maturity.
Our partnership agreement requires us to distribute, on a quarterly basis, 100% of our available cash to our unitholders of record within 45 days
following the end of every quarter. Available cash with respect to any quarter is generally all of our cash on hand at the end of such quarter, less
cash reserves for certain purposes. The board of directors of our general partner will determine the amount and timing of such distributions and has
broad discretion to establish and make additions to our reserves or the reserves of our operating subsidiaries as it determines are necessary or
appropriate. As a result, we do not have the same flexibility as corporations or other entities that do not pay dividends or have complete flexibility
regarding the amounts they will distribute to their equity holders. Although our payment obligations to our unitholders are subordinate to our
payment obligations to you, the timing and amount of our quarterly distributions to our unitholders could significantly reduce the cash available to
pay the principal, premium (if any) and interest on the notes.
Because we have a holding company structure in which our subsidiaries conduct our operations and own our operating assets, our ability to
service our debt is largely dependent on our receipt of distributions or other payments from our subsidiaries.
We are a partnership holding company, and our subsidiaries conduct all of our operations and own all of our operating assets. We do not have
significant assets other than the ownership interests in our subsidiaries. As a result, our ability to make required payments on the notes depends on
the performance of our subsidiaries and their ability to distribute funds to us. The ability of our subsidiaries to make distributions to us may be
restricted by, among other things, credit instruments, applicable state business organization laws and other laws and regulations. If we are unable to
obtain the funds necessary to pay all the principal and interest on the notes when due, we may be required to adopt one or more alternatives, such
as a refinancing of the notes. We cannot assure you that we would be able to refinance the notes on terms that are acceptable to us, or at all.
We may be able to incur substantially more debt. This could exacerbate the risks associated with our indebtedness.
We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The total borrowing capacity under our revolving
credit facility, which matures in October 2020, is $1.0 billion and the total borrowing capacity under our 364-day revolving credit facility, which
matures on October 19, 2017, is $250.0 million. As of September 25, 2017, we had no outstanding borrowings under our revolving credit facility
and our 364-day revolving credit facility and $314 million outstanding indebtedness under our commercial paper program. If we incur any
additional indebtedness, including borrowings under our revolving credit facility and issuances of additional notes, that ranks equally with the
notes, the holders of that debt will be entitled to share ratably with you in any proceeds distributed in connection with any insolvency, liquidation,
reorganization, dissolution or other winding up of us. This may have the effect of reducing the amount of proceeds paid to you. If new debt is
added to our current debt levels, the related risks that we now face could intensify.
The indenture governing the notes will also permit us and our subsidiaries to incur additional indebtedness, including secured indebtedness, that
could effectively rank senior to the notes, and to engage in sale-leaseback

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