Item 1.01 Entry into a Material Definitive Agreement.
Agreement and Plan of Merger
On March 4, 2021, Noble Midstream Partners LP, a Delaware limited partnership
(the "Partnership"), Noble Midstream GP LLC, a Delaware limited liability
company and the general partner of the Partnership (the "General Partner"),
Chevron Corporation, a Delaware corporation ("Chevron"), Cadmium Holdings Inc.,
a Delaware corporation and a wholly owned subsidiary of Chevron ("Holdings"),
and Cadmium Merger Sub LLC, a Delaware limited liability company and a wholly
owned subsidiary of Holdings ("Merger Sub"), entered into an Agreement and Plan
of Merger (the "Merger Agreement"), pursuant to which Merger Sub will merge with
and into the Partnership, with the Partnership surviving as an indirect, wholly
owned subsidiary of Chevron (the "Merger").
Under the terms of the Merger Agreement, at the effective time of the Merger,
(i) each outstanding common unit representing a limited partner interest in the
Partnership (each, a "Partnership Common Unit") other than Partnership Common
Units owned by Chevron and its subsidiaries (each, a "Public Common Unit") will
be converted into the right to receive 0.1393 shares of common stock, par value
$0.75 per share, of Chevron (the "Chevron Common Stock" and the shares of
Chevron Common Stock to be issued in the Merger, the "Merger Consideration"). In
connection with the Merger, (i) the General Partner's non-economic general
partner interest in the Partnership and (ii) the Common Units owned by Chevron
and its subsidiaries shall not be cancelled, shall not be converted into the
Merger Consideration and shall remain outstanding following the Merger as a
non-economic general partner interest in the Partnership and as Common Units,
respectively.
The Conflicts Committee (the "Conflicts Committee") of the board of directors of
the General Partner (the "GP Board") has (i) determined that the Merger
Agreement and the transactions contemplated thereby, including the Merger, are
in, or are not adverse to, the interests of the Partnership and the holders of
Public Common Units, (ii) approved the Merger Agreement and the transactions
contemplated thereby, including the Merger, and (iii) recommended that the GP
Board resolve to direct that the Merger Agreement be submitted to a vote of the
limited partners of the Partnership (the "Limited Partners"). The GP Board
(acting upon the recommendation of the Conflicts Committee) has (i) determined
that the Merger Agreement and the transactions contemplated thereby, including
the Merger, are in, or not adverse to, the interests of the Partnership and the
Limited Partners, (ii) approved the execution, delivery and performance of the
Merger Agreement and the transactions contemplated thereby, including the
Merger, (iii) directed that the Merger Agreement be submitted to a vote of the
Limited Partners and (iv) authorized the Limited Partners to act by written
consent pursuant to the terms of the Partnership Agreement.
Concurrently with the execution of the Merger Agreement, NBL Midstream, LLC, a
Delaware limited liability company and an indirect, wholly owned subsidiary of
Chevron ("NBL"), which as of the Record Date (as defined below) held 56,447,616
Partnership Common Units (the "Covered Units"), representing approximately 62.4%
of the outstanding Partnership Common Units, delivered its written consent
covering all of the Covered Units approving the Merger Agreement and the
transactions contemplated thereby, including the Merger (the "Written Consent").
The Merger Agreement contains customary representations and warranties from the
parties, and each party has agreed to customary covenants, including, among
others, covenants relating to (i) the conduct of business during the interim
period between the execution of the Merger Agreement and the effective time of
the Merger and (ii) the obligation to use reasonable best efforts to cause the
Merger to be consummated.
Completion of the Merger is subject to certain customary conditions, including,
among others: (i) approval of the Merger Agreement by holders of a majority of
the outstanding Common Units, which was received on March 4, 2021 in the Written
Consent; (ii) there being no law or injunction prohibiting consummation of the
transactions contemplated under the Merger Agreement; (iii) the effectiveness of
a registration statement on Form S-4 relating to the shares of Chevron Common
Stock to be issued as Merger Consideration; (iv) approval for listing on the New
York Stock Exchange of the shares of Chevron Common Stock to be issued as Merger
Consideration; (v) subject to specified materiality standards, the accuracy of
certain representations and warranties of each party; and (vi) compliance by
each party in all material respects with its covenants.
The Merger Agreement provides for certain termination rights for both Chevron
and the Partnership, including in the event that (i) the parties agree by mutual
written consent to terminate the Merger Agreement, (ii) the Merger is not
consummated by September 4, 2021 or (iii) a law or injunction prohibiting the
consummation of the
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transactions contemplated by the Merger Agreement is in effect and has become
final and non-appealable. The Merger Agreement provides that upon termination of
the Merger Agreement under certain circumstances, (i) the Partnership will be
obligated to reimburse Chevron for its expenses and (ii) Chevron will be
obligated to reimburse the Partnership for its expenses, in each case, in an
amount not to exceed $3.5 million.
The foregoing description of the Merger Agreement and the transactions
contemplated thereby does not purport to be complete and is qualified in its
entirety by the actual Merger Agreement, a copy of which is filed as Exhibit 2.1
to this Current Report on Form 8-K and incorporated into this Item 1.01 by
reference.
The foregoing summary of the Merger Agreement has been included to provide
investors and security holders with information regarding the terms of the
Merger Agreement and is qualified in its entirety by the terms and conditions of
the Merger Agreement. It is not intended to provide any other factual
information about Chevron, the Partnership or their respective subsidiaries and
affiliates. The representations, warranties and covenants contained in the
Merger Agreement were made only for purposes of such agreement and as of
specified dates, were solely for the benefit of the respective parties to such
agreement, may be subject to limitations agreed upon by the contracting parties,
including being qualified by confidential disclosures made for the purposes of
allocating contractual risk between the respective parties to such agreement
instead of establishing these matters as facts, and may be subject to standards
of materiality that differ from those applicable to investors. Investors should
not rely on the representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or condition of
Chevron, the Partnership or any of their respective subsidiaries or affiliates.
Moreover, information concerning the subject matter of the representations,
warranties and covenants may change after the date of the Merger Agreement,
. . .
Item 5.07 Submission of Matters to a Vote of Securityholders.
In connection with the completion of the Merger, the GP Board authorized the
Limited Partners to act by written consent pursuant to the terms of the
Partnership Agreement in order to provide their approval for the Merger
Agreement and the transactions contemplated thereby, including the Merger. The
GP Board set March 4, 2021 as the record date (the "Record Date") for
determining the Limited Partners entitled to execute and deliver written
consents approving the Merger Agreement and the transactions contemplated
thereby, including the Merger. Concurrently with the execution of the Merger
Agreement, NBL, which as of the Record Date held the Covered Units, representing
approximately 62.4% of the outstanding Partnership Common Units, delivered the
Written Consent. The Written Consent was sufficient to approve the Merger
Agreement and the transactions contemplated thereby, including the Merger,
without the receipt of written consents from any other holder of Partnership
Common Units.
Item 7.01 Regulation FD Disclosure.
Chevron and the Partnership issued a joint press release on March 5, 2021
announcing the execution of the Merger Agreement. A copy of the press release is
attached hereto as Exhibit 99.1 to this Current Report on Form 8-K and is
incorporated into this Item 7.01 by reference.
The information set forth in this Item 7.01 and the attached Exhibit 99.1 shall
not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended (the "Exchange Act").
Forward-Looking Statements
All statements in this report (and oral statements made regarding the subjects
of this communication), including those that express a belief, expectation or
intention, may be considered forward-looking statements (as defined in
Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A
of the Securities Act) that involve risks and uncertainties that could cause
actual results to differ materially from projected results. Without limiting the
generality of the foregoing, forward-looking statements contained in this
communication include statements relying on a number of assumptions concerning
future events and are subject to a number of uncertainties and factors, many of
which are outside the control of Chevron and the Partnership, which could cause
actual results to differ materially from such statements. Accordingly, investors
should not place undue reliance on forward-looking statements as a prediction of
actual results. The forward-looking statements may include, but are not limited
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to, statements regarding the expected benefits of the proposed transaction to
Chevron and the Partnership and their stockholders and unitholders,
respectively; the anticipated completion of the proposed transaction and the
timing thereof; and the expected future growth, dividends and distributions of
the combined company; and plans and objectives of management for future
operations. This report contains forward-looking statements within the meaning
of the federal securities laws. Words such as "estimate," "anticipate,"
"believe," "project," "budget," "continue," "could," "intend," "may," "plan,"
"potential," "predict," "seek," "should," "will," "would," "expect,"
"objective," "projection," "forecast," "goal," "guidance," "outlook," "effort,"
"target," "on schedule," "on track," "strategy" and other similar expressions
may be used to identify forward-looking statements. Forward-looking statements
are not statements of historical fact and reflect the Partnership's current
views about future events. Our forward-looking statements may include statements
about our business strategy, our industry, our future profitability, our
expected capital expenditures and the impact of such expenditures on our
performance, the costs of being a publicly traded partnership and our capital
programs. In addition, our forward-looking statements address the various risks
and uncertainties associated with the extraordinary market environment and
impacts resulting from the COVID-19 pandemic and the actions of foreign oil
producers (most notably Saudi Arabia and Russia) to maintain market share and
impact commodity pricing and the expected impact on our business, operations,
earnings and results. You are cautioned not to place undue reliance on any
forward-looking statements, which speak only as of the date hereof. The
Partnership does not assume any obligation to update publicly any
forward-looking statements whether as a result of new information, future events
or otherwise.
Forward-looking statements are not guarantees of future performance, are based
on certain assumptions, and are subject to certain risks, uncertainties and
other factors, many of which are beyond our control and difficult to predict,
that could cause actual results to differ materially from those projected. These
risks include, without limitation, the ability to realize the expected benefits
of the proposed transaction to Chevron and its shareholders and the Partnership
and its unitholders; the ability to consummate, and the timing of such
consummation of, the proposed transaction; changes in general economic
conditions, including without limitation the impacts of the COVID-19 pandemic;
our customers' ability to meet their drilling and development plans; competitive
conditions in the Partnership's industry; actions taken by third-party
operators, gatherers, processors and transporters; the demand for crude oil and
natural gas gathering and processing services; our ability to successfully
implement our business plan; our ability to complete internal growth projects on
time and on budget; the ability of third parties to complete construction of
pipelines in which the Partnership holds equity interests on time and on budget;
the price and availability of debt and equity; the availability and price of
crude oil and natural gas to the consumer compared to the price of alternative
and competing fuels; risks associated with the change in ownership of our
General Partner; and other risks inherent in the Partnership's business,
including those described under "Risk Factors" and "Disclosure Regarding
Forward-Looking Statements" in the Partnership's 2020 Annual Report on Form 10-K
and in subsequent reports that we file with the U.S. Securities and Exchange
Commission ("SEC").
No Offer or Solicitation
This report is for informational purposes only and shall not constitute an offer
to sell or the solicitation of an offer to buy any securities pursuant to the
proposed transaction or otherwise, nor shall there be any sale of securities in
any jurisdiction in which the offer, solicitation or sale would be unlawful
prior to the registration or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act, as
amended.
Additional Information and Where You Can Find It
In connection with the proposed transaction, Chevron will file a registration
statement on Form S-4, which will include an information statement of the
Partnership with the SEC. INVESTORS AND SECURITY HOLDERS OF CHEVRON AND THE
PARTNERSHIP ARE ADVISED TO CAREFULLY READ THE REGISTRATION STATEMENT AND
INFORMATION STATEMENT, PROSPECTUS OR OTHER DOCUMENT (INCLUDING ALL AMENDMENTS
AND SUPPLEMENTS THERETO) WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE TRANSACTION, THE PARTIES TO THE TRANSACTION AND
THE RISKS ASSOCIATED WITH THE TRANSACTION. A definitive information statement,
will be sent to securityholders of the Partnership in connection with any
solicitation of proxies or consents of the Partnership unitholders relating to
the proposed transaction. Investors and securityholders may obtain a free copy
of such documents and other relevant documents (if and when available) filed by
Chevron or the Partnership with the SEC from the SEC's website at www.sec.gov.
Securityholders and other interested parties will also be able to obtain,
without charge, a copy of such documents and other relevant documents (if and
when available) from Chevron's website at www.chevron.com under the "Investors"
tab under the heading "SEC Filings" or from the Partnerships's website at
. . .
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description of the Exhibit
2.1* Agreement and Plan of Merger, dated as of March 4, 2021, by and
among Chevron Corporation, Cadmium Holdings Inc., Cadmium Merger Sub
LLC, Noble Midstream Partners LP, and Noble Midstream GP LLC
99.1 Press Release dated March 5, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
* The schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K
and will be provided to the Securities and Exchange Commission upon request.
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