Obligation Plains American Pipeline 4.5% ( US72650RBL50 ) en USD

Plains American Pipeline

98.978 % ▼

Etas-Unis

US72650RBL50 ( en USD )

4.5% par an ( paiement semestriel )

15/12/2026

Prospectus brochure de l'obligation Plains All American Pipeline US72650RBL50 en USD 4.5%, échéance 15/12/2026

1 000 USD

750 000 000 USD

72650RBL5

BBB ( Qualité moyenne inférieure )

Baa2 ( Qualité moyenne inférieure )

15/06/2026 ( Dans 72 jours )

Plains All American Pipeline LP est une société américaine de transport d'énergie qui exploite un réseau d'oléoducs, de terminaux et d'installations de stockage pour le pétrole brut et les produits pétroliers raffinés.

L'Obligation émise par Plains American Pipeline ( Etas-Unis ) , en USD, avec le code ISIN US72650RBL50, paye un coupon de 4.5% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 15/12/2026

L'Obligation émise par Plains American Pipeline ( Etas-Unis ) , en USD, avec le code ISIN US72650RBL50, a été notée Baa2 ( Qualité moyenne inférieure ) par l'agence de notation Moody's.

L'Obligation émise par Plains American Pipeline ( Etas-Unis ) , en USD, avec le code ISIN US72650RBL50, a été notée BBB ( Qualité moyenne inférieure ) par l'agence de notation Standard & Poor's ( S&P ).

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TABLE OF CONTENTS
TABLE OF CONTENTS
Table of Contents
Filed pursuant to Rule 424(b)(5)
Registration No. 333-207139
333-207139-01
CALCULATION OF REGISTRATION FEE

Proposed maximum
Title of Each Class of Securities
aggregate offering
Amount of
to be Registered

price

registration fee

4.50% Senior Notes due 2026

$747,870,000

$86,679(1)

(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. 333-207139 by means of this prospectus supplement.
Table of Contents
PROSPECTUS SUPPLEMENT
To prospectus dated September 25, 2015
Plains All American Pipeline, L.P.
PAA Finance Corp.
$750,000,000 4.50% Senior Notes due 2026
Plains All American Pipeline, L.P. and PAA Finance Corp. are offering $750 million aggregate principal amount of 4.50% Senior Notes due 2026
(the "Notes").
We will pay interest on the Notes semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2017. The Notes will
mature on December 15, 2026, unless redeemed prior to the maturity date.
We may, at our option, redeem the Notes at any time in whole or from time to time in part, prior to maturity, at the redemption prices as described
herein under "Description of Notes--Optional Redemption."
The Notes will be the unsecured senior obligations of Plains All American Pipeline, L.P. and PAA Finance Corp. and will rank equally in right of
payment with their other senior indebtedness from time to time outstanding.
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 have the Notes quoted on any automated quotation system.
Investing in the Notes involves risks. See "Risk Factors" beginning on page S-5 of this prospectus supplement.
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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.

Public Offering
Underwriting
Proceeds, Before

Price(1)

Discount

Expenses, to Us

Per Note

99.716%

0.650%

99.066%

Total

$747,870,000

$4,875,000

$742,995,000

(1)
Plus accrued interest, if any, from November 22, 2016 if settlement occurs after that date.
The underwriters expect to deliver the Notes in book-entry form only through facilities of The Depository Trust Company for the account of its
participants, including Clearstream Banking, société anonyme, and Euroclear Bank SA/NV, as operator of the Euroclear System, against payment in
New York, New York on or about November 22, 2016, the fifth trading day after the date of this prospectus supplement.
Joint Book-Running Managers
J.P. Morgan
BNP PARIBAS
BofA Merrill Lynch

Wells Fargo Securities

BBVA

DNB Markets

SMBC Nikko
Co-Managers
CIBC Capital Markets

Fifth Third Securities

ING

PNC Capital Markets LLC

Regions Securities LLC

US Bancorp

The date of this prospectus supplement is November 15, 2016.
Table of Contents
TABLE OF CONTENTS
Prospectus Supplement

Important Notice About Information in this Prospectus Supplement and the Accompanying Base Prospectus
S-ii
Forward-Looking Statements
S-ii
Prospectus Supplement Summary
S-1
Risk Factors
S-5
Use of Proceeds
S-7
Ratio of Earnings to Fixed Charges
S-8
Capitalization
S-9
Description of Notes
S-11
Book Entry, Delivery and Form
S-24
Material U.S. Federal Income Tax Consequences
S-27
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Underwriting
S-33
Legal Matters
S-37
Experts
S-37
Where You Can Find More Information
S-37
Prospectus

About This Prospectus

i
Where You Can Find More Information

i
Forward-Looking Statements

ii
About Plains All American Pipeline, L.P.

1
Risk Factors

3
Use Of Proceeds

4
Ratio Of Earnings To Fixed Charges

5
Description of Our Debt Securities

6
Description of Our Common Units
15
Cash Distribution Policy
17
Description of Our Partnership Agreement
21
Material U.S. Federal Income Tax Consequences
24
Plan of Distribution
38
Legal Matters
40
Experts
41
S-i
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IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS SUPPLEMENT AND THE
ACCOMPANYING BASE PROSPECTUS
This document is in two parts. The first part is the prospectus supplement, which describes our business and the specific terms of this offering. The
second part, the accompanying base prospectus, gives more general information and includes disclosures regarding the Notes and additional disclosures
that would pertain if at some time in the future we were to offer other series of our debt securities or our common units. Accordingly, the
accompanying base prospectus may contain information that does not apply to this offering. Generally, when we refer only to the "prospectus," we are
referring to both parts combined.
If the description of the offering varies between the prospectus supplement and the accompanying base prospectus, you should rely on the
information in the prospectus supplement.
You should rely only on the information contained in or incorporated by reference into this prospectus supplement, the accompanying base
prospectus or any free writing prospectus relating to this offering of Notes. Neither we nor the underwriters have authorized anyone to provide you with
different information. Neither we nor the underwriters are making an offer of the Notes in any jurisdiction where the offer is not permitted. You should
not assume that the information contained in or incorporated by reference into this prospectus supplement, the accompanying base prospectus or any
related free writing prospectus is accurate as of any date other than the date on the front of those respective documents. Our business, financial
condition, results of operations and prospects may have changed since those dates.
The information in this prospectus supplement is not complete. You should review carefully all of the detailed information appearing in this
prospectus supplement, the accompanying base prospectus, any free writing prospectus relating to this offering and the documents we have incorporated
by reference before making any investment decision.
We expect delivery of the Notes will be made against payment therefor on or about November 22, 2016, which is the fifth business day following
the date of pricing of the Notes (such settlement being referred to as "T+5"). Under Rule 15c6-1 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), trades in the secondary market generally are required to settle in three business days unless the parties to any such trade expressly
agree otherwise. Accordingly, purchasers who wish to trade the Notes on the date of pricing of the Notes or the next succeeding business day will be
required, by virtue of the fact that the Notes initially will settle in T+5, to specify an alternate settlement cycle at the time of any such trade to prevent
failed settlement and should consult their own advisers.
FORWARD-LOOKING STATEMENTS
All statements included in or incorporated by reference into this prospectus supplement or the accompanying base prospectus, other than statements
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of historical fact, are forward-looking statements, including but not limited to statements incorporating the words "anticipate," "believe," "estimate,"
"expect," "plan," "intend" and "forecast," as well as similar expressions and statements regarding our business strategy, plans and objectives for future
operations. The absence of such words, expressions or statements, however, does not mean that the statements are not forward-looking. Any such
forward-looking statements reflect our current views with respect to future events, based on what we believe to be reasonable assumptions. Certain
factors could cause actual results or outcomes to differ materially from the results or outcomes anticipated in the forward-looking statements. The most
important of these factors include, but are not limited to:
·
declines in the volume of crude oil, refined product and NGL shipped, processed, purchased, stored, fractionated and/or gathered at or
through the use of our assets, whether due to declines
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in production from existing oil and gas reserves, failure to develop or slowdown in the development of additional oil and gas reserves,
whether from reduced cash flow to fund drilling or the inability to access capital, or other factors;
·
the effects of competition;
·
failure to implement or capitalize, or delays in implementing or capitalizing, on expansion projects;
·
unanticipated changes in crude oil market structure, grade differentials and volatility (or lack thereof);
·
environmental liabilities or events that are not covered by an indemnity, insurance or existing reserves;
·
fluctuations in refinery capacity in areas supplied by our mainlines and other factors affecting demand for various grades of crude oil,
refined products and natural gas and resulting changes in pricing conditions or transportation throughput requirements;
·
the occurrence of a natural disaster, catastrophe, terrorist attack or other event, including attacks on our electronic and computer systems;
·
maintenance of our credit rating and ability to receive open credit from our suppliers and trade counterparties;
·
tightened capital markets or other factors that increase our cost of capital or limit our ability to obtain debt or equity financing on
satisfactory terms to fund additional acquisitions, expansion projects, working capital requirements and the repayment or refinancing of
indebtedness;
·
the currency exchange rate of the Canadian dollar;
·
continued creditworthiness of, and performance by, our counterparties, including financial institutions and trading companies with which
we do business;
·
inability to recognize current revenue attributable to deficiency payments received from customers who fail to ship or move more than
minimum contracted volumes until the related credits expire or are used;
·
non-utilization of our assets and facilities;
·
increased costs, or lack of availability, of insurance;
·
weather interference with business operations or project construction, including the impact of extreme weather events or conditions;
·
the availability of, and our ability to consummate, acquisition or combination opportunities;
·
the successful integration and future performance of acquired assets or businesses and the risks associated with operating in lines of
business that are distinct and separate from our historical operations;
·
the effectiveness of our risk management activities;
·
shortages or cost increases of supplies, materials or labor;
·
the impact of current and future laws, rulings, governmental regulations, accounting standards and statements, and related
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interpretations;
·
fluctuations in the debt and equity markets, including the price of our units at the time of vesting under our long-term incentive plans;
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·
risks related to the development and operation of our assets, including our ability to satisfy our contractual obligations to our customers;
·
factors affecting demand for natural gas and natural gas storage services and rates;
·
general economic, market or business conditions and the amplification of other risks caused by volatile financial markets, capital
constraints and pervasive liquidity concerns; and
·
other factors and uncertainties inherent in the transportation, storage, terminalling and marketing of crude oil and refined products, as
well as in the storage of natural gas and the processing, transportation, fractionation, storage and marketing of natural gas liquids.
Other factors described or incorporated by reference herein, as well as factors that are unknown or unpredictable, could also have a material adverse
effect on future results. Please read "Risk Factors" beginning on page S-5 of this prospectus supplement and in Item 1A. "Risk Factors" in our Annual
Report on Form 10-K for the fiscal year ended December 31, 2015 (File No. 001-14569) and in any subsequent quarterly reports on Form 10-Q, which
are incorporated in this prospectus supplement by reference, for information regarding risks you should consider before making an investment decision.
Except as required by applicable securities laws, we do not intend to update these forward-looking statements and information.
S-iv
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PROSPECTUS SUPPLEMENT SUMMARY
This summary highlights information included or incorporated by reference 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 carefully the entire
prospectus supplement, the accompanying base prospectus, the documents incorporated by reference herein and therein and the other documents to
which we refer herein and therein for a more complete understanding of this offering of Notes. Please read "Risk Factors" beginning on page S-5 of
this prospectus supplement and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 and in any subsequent quarterly
report on Form 10-Q, which are incorporated by reference herein, for information regarding risks you should consider before making a decision to
purchase any Notes in this offering.
For purposes of this prospectus supplement and the accompanying base prospectus, except as set forth in "Description of Notes" and unless the
context clearly indicates otherwise, references to "PAA," the "Partnership," "we," "us," "our" and similar terms refer to Plains All American
Pipeline, L.P. and its subsidiaries. With respect to the cover page and in the section entitled "--The Offering," "we," "our" and "us" refer only to Plains
All American Pipeline, L.P. and, as the context requires, PAA Finance Corp., but not to any of the other subsidiaries of Plains All American
Pipeline, L.P. References to our "general partner," as the context requires, include any or all of PAA GP LLC, Plains AAP, L.P. and Plains All
American GP LLC.
Plains All American Pipeline, L.P.
We are a Delaware limited partnership formed in 1998. Our operations are conducted directly and indirectly through our primary operating
subsidiaries. We own and operate midstream energy infrastructure and provide logistics services for crude oil, natural gas liquids ("NGL"), natural gas
and refined products.
We own an extensive network of pipeline transportation, terminalling, storage and gathering assets in key crude oil and NGL producing basins and
transportation corridors and at major market hubs in the United States and Canada. Our business activities are conducted through three operating
segments: Transportation, Facilities and Supply and Logistics.
Ongoing Acquisition and Investment Activities
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Consistent with our business strategy, we are continuously engaged in the evaluation of potential acquisitions, joint ventures and capital projects.
As a part of these efforts, we often engage in discussions with potential sellers or other parties regarding the possible purchase of or investment in assets
and operations that are strategic and complementary to our existing operations. In addition, in the past we have evaluated and pursued, and intend in the
future to evaluate and pursue, the acquisition of or investment in other energy-related assets that have characteristics and provide opportunities similar
to our existing business lines and enable us to leverage our assets, knowledge and skill sets. Such efforts may involve participation by us in processes
that have been made public and involve a number of potential buyers or investors, commonly referred to as "auction" processes, as well as situations in
which we believe we are the only party or one of a limited number of parties who are in negotiations with the potential seller or other party. These
acquisition and investment efforts often involve assets which, if acquired or constructed, could have a material effect on our financial condition and
results of operations.
From time to time, we may also sell assets that we regard as non-core or that we believe might be a better fit with the business and/or assets of a
third-party buyer.
We typically do not announce a transaction until after we have executed a definitive agreement. However, in certain cases in order to protect our
business interests or for other reasons, we may defer
S-1
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public announcement of a transaction until closing or a later date. Past experience has demonstrated that discussions and negotiations regarding a
potential transaction can advance or terminate in a short period of time. Moreover, the closing of any transaction for which we have entered into a
definitive agreement may be subject to customary and other closing conditions, which may not ultimately be satisfied or waived. Accordingly, we can
give no assurance that our current or future acquisition, divestiture or investment efforts will be successful. Although we expect the acquisitions and
investments we make to be accretive in the long term, we can provide no assurance that our expectations will ultimately be realized.
Recent Developments
Simplification Transactions
On July 11, 2016, we entered into a Simplification Agreement (the "Simplification Agreement") with Plains GP Holdings, L.P. ("PAGP"), Plains
AAP, L.P. ("Plains AAP"), PAA GP LLC ("PAA GP"), Plains All American GP LLC ("GP LLC") and PAA GP Holdings LLC. Pursuant to the
Simplification Agreement, in exchange for the issuance by us to Plains AAP of approximately 245.5 million common units and our assumption of
Plains AAP's outstanding debt of approximately $642 million, subject to certain adjustments, Plains AAP will contribute our incentive distribution
rights to us for cancellation thereof and PAA GP's 2% economic general partner interest in us will be converted into a non-economic general partner
interest. Following the closing of the transactions contemplated by the Simplification Agreement (the "Simplification"), which is expected to occur on
November 15, 2016, both PAA and PAGP will continue to be publicly traded. We will be required to repay the outstanding indebtedness of Plains AAP
assumed by us in connection with the Simplification within two business days after the day on which the transactions contemplated by the
Simplification close, which repayment date is expected to be November 17, 2016.
Our Principal Executive Offices
Our executive offices are located at 333 Clay Street, Suite 1600, Houston, Texas 77002. Our telephone number is (713) 646-4100. We maintain a
website at www.plainsallamerican.com that provides information about our business and operations. Information contained on or available through our
website is not incorporated into or otherwise a part of this prospectus supplement or the accompanying base prospectus.
Additional Information
For additional information about us, including our partnership structure and management, please refer to the documents set forth under "Where You
Can Find More Information" in this prospectus supplement, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2015
and our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2016, June 30, 2016 and September 30, 2016, each of which is
incorporated by reference herein.
S-2
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THE OFFERING
The summary below describes the principal terms of the Notes. Certain of the terms described below are subject to important limitations and
exceptions. The "Description of Notes" section of this prospectus supplement and the "Description of Our Debt Securities" section of the accompanying
base prospectus contain a more detailed description of the terms of the Notes.
Issuers

Plains All American Pipeline, L.P. and PAA Finance Corp.

PAA Finance Corp., a Delaware corporation, is a wholly owned subsidiary of
Plains All American Pipeline, L.P. that has been organized for the purpose of
co-issuing our existing notes, the Notes offered hereby and the notes issued
in any future offerings. PAA Finance Corp. does not have operations of any
kind and will not have any revenue other than as may be incidental to its
activities as a co-issuer of our debt securities.
Future guarantees

Initially, the Notes will not be guaranteed by any subsidiaries of the issuers.
In the future, however, if any subsidiaries guarantee any of the issuers' other
debt, then those subsidiaries will, jointly and severally, fully and
unconditionally guarantee the issuers' payment obligations under the Notes.
Please read "Description of Notes--Possible Future Guarantees."
Notes offered

$750,000,000 aggregate principal amount of 4.50% Senior Notes due 2026.
Maturity date

December 15, 2026.
Interest rate

4.50%.
Interest payment dates

We will pay interest on the Notes semi-annually in arrears on June 15 and of
December 15 each year, beginning on June 15, 2017.
Optional redemption

We may redeem the Notes, in whole or in part, at any time and from time to
time prior to maturity. If we redeem the Notes before September 15, 2026
(three months prior to their maturity date), the Notes may be redeemed at a
price equal to the greater of (i) 100% of the principal amount of the Notes to
be redeemed or (ii) the sum of the present values of the remaining scheduled
payments of principal of and interest on the Notes to be redeemed that would
be due if the Notes matured three months prior to the maturity date (which
we refer to as the "Par Call Date"), discounted to the redemption date on a
semiannual basis at the Adjusted Treasury Rate (as defined herein) plus 35
basis points, together with accrued and unpaid interest to the date of
redemption. If we redeem the Notes on or after September 15, 2026 (three
months prior to their maturity date), the redemption price will equal 100% of
the principal amount of the Notes to be redeemed plus accrued and unpaid
interest to the redemption date. See "Description of Notes--Optional
Redemption."
Ranking

The Notes will be general senior unsecured obligations of the issuers and will
rank equally in right of payment with the existing and future senior
indebtedness of the issuers.
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Certain covenants

The Notes will be issued under an indenture containing covenants for your
benefit. These covenants restrict our ability, with certain exceptions, to:

· incur liens on principal properties to secure debt;

· engage in sale-leaseback transactions; and

· merge or consolidate with another entity or sell, lease or transfer
substantially all of our properties or assets to another entity.

See "Description of Notes--Covenants."
Use of proceeds

The net proceeds of this offering will be approximately $741.3 million after
deducting the underwriting discount and our estimated offering expenses. We
expect to use the net proceeds from this offering to repay outstanding
borrowings under our senior unsecured revolving credit facility and
commercial paper program and for general partnership purposes.

Amounts repaid under our senior unsecured revolving credit facility and
commercial paper program may be reborrowed, as necessary, to fund our
ongoing expansion capital program, future acquisitions and investments or
for general partnership purposes. Please read "Use of Proceeds."
Book entry, delivery and form

The Notes will be represented by one or more permanent global certificates
in fully registered form deposited with a custodian for, and registered in the
name of, a nominee of The Depository Trust Company.
Further issuances

We may create and issue additional Notes ranking equally and ratably with
the Notes offered by this prospectus supplement in all respects, so that such
additional Notes will be consolidated and form a single series with such
Notes and will have the same terms, as to status, redemption or otherwise
except for the issue date, the initial interest payment date, if applicable, and
the payment of interest accruing prior to the issue date of such additional
Notes.
No listing

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 have the Notes quoted on any automated quotation system. See
"Risk Factors--Risks Related to the Notes--Your ability to transfer the
Notes may be limited by the absence of an organized trading market."
Governing law

State of New York.
Trustee

U.S. Bank National Association.
Risk factors

Investing in the Notes involves risks. You should consider carefully all of the
information in this prospectus supplement, the accompanying base
prospectus, any free writing prospectus relating to this offering and the
documents incorporated by reference herein and therein. In particular, you
should consider carefully the specific risks set forth in "Risk Factors"
beginning on page S-5 of this prospectus supplement.
S-4
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RISK FACTORS
Before making an investment in the Notes offered hereby, you should carefully consider the risk factors included below and those included in
Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (File No. 001-14569), which is incorporated
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by reference herein, together with all of the other information included in or incorporated by reference into this prospectus supplement and the
accompanying base prospectus. If any of these risks were to occur, our business, financial condition or results of operations could be materially
adversely affected. In such case, the value of the Notes could decline, and you could lose all or part of your investment.
Risks Related to the Notes
Your right to receive payments on the Notes is unsecured and will be effectively subordinated to our existing and future secured indebtedness and
will be structurally subordinated as to any existing and future indebtedness and other obligations of our subsidiaries, other than subsidiaries that
may guarantee the Notes in the future.
The Notes are effectively subordinated to claims of our secured creditors and to any existing and future indebtedness and other obligations of our
subsidiaries, including trade payables, other than subsidiaries that may guarantee the Notes in the future. As of September 30, 2016, on an as further
adjusted basis as described under "Capitalization," the Notes would have been subordinated to $500 million of short-term secured indebtedness and
would have been structurally subordinated to $560 million of our subsidiaries' indebtedness. In the event of the insolvency, bankruptcy, liquidation,
reorganization, dissolution or winding up of the business of a subsidiary, other than a subsidiary that may guarantee the Notes in the future, creditors of
that subsidiary would generally have the right to be paid in full before any distribution is made to us or the holders of the Notes.
Our leverage may limit our ability to borrow additional funds, comply with the terms of our indebtedness or capitalize on business opportunities.
Our leverage is significant in relation to our partners' capital. As of September 30, 2016, on an as further adjusted basis as described under
"Capitalization," our total outstanding long-term debt was approximately $10.122 billion, and our total outstanding short-term debt was approximately
$1.384 billion. Various limitations in our credit facilities and other debt instruments may reduce our ability to incur additional debt, to engage in some
transactions and to capitalize on business opportunities. Any subsequent refinancing of our current indebtedness or any new indebtedness could have
similar or greater restrictions.
Our leverage could have important consequences to investors in the Notes. We will require substantial cash flow to meet our principal and interest
obligations with respect to the Notes and our other consolidated indebtedness. Our ability to make scheduled payments, to refinance our obligations
with respect to our indebtedness or our ability to obtain additional financing in the future will depend on our financial and operating performance,
which, in turn, is subject to prevailing economic conditions and to financial, business and other factors. We believe that we will have sufficient cash
flow from operations and available borrowings under our bank credit facility to service our indebtedness, although the principal amount of the Notes
will likely need to be refinanced at maturity in whole or in part. A significant downturn in the hydrocarbon industry or other development adversely
affecting our cash flow could materially impair our ability to service our indebtedness. If our cash flow and capital resources are insufficient to fund our
debt service obligations, we may be forced to refinance all or a portion of our debt or sell assets. We can give no assurance that we would be able to
refinance our existing indebtedness or sell assets on terms that are commercially reasonable.
Our leverage may adversely affect our ability to fund future working capital, capital expenditures and other general partnership requirements,
future acquisition, construction or development activities,
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or to otherwise fully realize the value of our assets and opportunities because of the need to dedicate a substantial portion of our cash flow from
operations to payments on our indebtedness or to comply with any restrictive terms of our indebtedness. Our leverage may also make our results of
operations more susceptible to adverse economic and industry conditions by limiting our flexibility in planning for, or reacting to, changes in our
business and the industry in which we operate and may place us at a competitive disadvantage as compared to our competitors that have less debt.
Your ability to transfer the Notes may be limited by the absence of an organized trading market.
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 have the Notes quoted on any automated quotation system. Although certain of the underwriters have informed us that they
currently intend to make a market in the Notes, they are not obligated to do so. In addition, the underwriters may discontinue any such market making at
any time without notice. The liquidity of any market for the Notes will depend on the number of holders of the Notes, the interest of securities dealers in
making a market in the Notes and other factors. Accordingly, we can give no assurance as to the development, continuation or liquidity of any market
for the Notes.
We have a holding company structure in which our subsidiaries conduct our operations and own our operating assets.
We are a holding company, and our subsidiaries conduct all of our operations and own all of our operating assets. We have no 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 facilities and applicable state partnership laws and other laws and regulations. Pursuant to our credit facilities, we may be required to
establish cash reserves for the future payment of principal and interest on the amounts outstanding under our credit facilities. If we are unable to obtain
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the funds necessary to pay the principal amount at maturity of the Notes, 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.
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.
Unlike a corporation, our partnership agreement requires us to distribute, on a quarterly basis, 100% of our available cash to our unitholders of
record and our general partner. Available cash is generally all of our cash receipts adjusted for cash distributions and net changes to reserves. 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 partnerships in amounts the general partner determines in its reasonable discretion to be necessary or appropriate:
·
to provide for the proper conduct of our business and the businesses of our operating partnerships (including reserves for future capital
expenditures and for our anticipated future credit needs);
·
to provide funds for distributions to our unitholders and the general partner for any one or more of the next four calendar quarters; or
·
to comply with applicable law or any of our loan or other agreements.
Although our payment obligations to our unitholders are subordinate to our payment obligations to you, the value of our units will decrease in
direct correlation with decreases in the amount we distribute per unit. Accordingly, if we experience a liquidity problem in the future, we may not be
able to issue equity to recapitalize.
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USE OF PROCEEDS
The net proceeds of this offering will be approximately $741.3 million after deducting the underwriting discount and our estimated offering
expenses. We expect to use the net proceeds from this offering to repay outstanding borrowings under our senior unsecured revolving credit facility and
commercial paper program and for general partnership purposes. Amounts repaid under our senior unsecured revolving credit facility and commercial
paper program may be reborrowed, as necessary, to fund our ongoing expansion capital program, future acquisitions and investments or for general
partnership purposes.
Affiliates of certain underwriters are lenders under our senior unsecured revolving credit facility or dealers under our commercial paper program
and may hold commercial paper notes thereunder. Accordingly, they may receive a portion of the net proceeds from this offering. Please read
"Underwriting" in this prospectus supplement for further information.
As of November 14, 2016, we had approximately $900 million of borrowings outstanding under our senior secured hedged inventory facility with a
weighted average interest rate of 1.60%. Proceeds from such facility are primarily used to finance purchased or stored hedged inventory, including New
York Mercantile Exchange ("NYMEX") and Intercontinental Exchange ("ICE") margin deposits. As of November 14, 2016, we had no borrowings
outstanding under our senior unsecured revolving credit facility, which bears interest at a variable rate. On November 15, 2016 we plan to borrow
$642 million under our senior unsecured revolving credit facility and/or our senior secured hedged inventory facility, and will use such borrowings to
repay Plains AAP's outstanding indebtedness assumed in connection with the Simplification. As of November 14, 2016 there were no borrowings
outstanding under our senior unsecured 364-day revolving credit facility, which bears interest at a variable rate. As of November 14, 2016, we had
approximately $756 million of borrowings outstanding under our commercial paper program with a weighted average interest rate of approximately
1.44%. The outstanding borrowings under our commercial paper program have maturity dates of three months or less. Our commercial paper program is
backstopped by our senior secured hedged inventory facility and our senior unsecured revolving credit facility. Borrowings from our commercial paper
program are primarily used to fund hedged NGL and crude oil inventory and NYMEX and ICE margin deposits, capital investments and for other
general partnership purposes.
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RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed charges for the periods indicated on a consolidated historical basis. For purposes of
computing the ratio of earnings to fixed charges, "earnings" consist of pre-tax income from continuing operations before income from equity investees
plus fixed charges (excluding capitalized interest), distributed income of equity investees and amortization of capitalized interest. "Fixed charges"
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