UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Earliest Event Reported: February 8, 2004
Date of Report: February 13, 2004
Ferrellgas Partners, L.P.
Ferrellgas Partners Finance Corp.
Ferrellgas, L.P.
Ferrellgas Finance Corp.
---------------------------------------------------------
(Exact name of registrants as specified in their charters)
Delaware 001-11331 43-1698480
Delaware 333-06693 43-1742520
Delaware 000-50182 43-1698481
Delaware 000-50183 14-1866671
-------------------------- ------------------ ----------------------------
(States or other Commission file (I.R.S. Employer
jurisdictions of numbers Identification Nos.)
incorporation or
organization)
One Liberty Plaza, Liberty, Missouri 64068
--------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrants' telephone number, including area code: (816) 792-1600
ITEM 5. OTHER EVENTS
Contribution Agreement
On February 8, 2004, Ferrellgas Partners, L.P., Ferrellgas, L.P.,
Ferrellgas, Inc., and FCI Trading Corp. entered into a Contribution Agreement.
FCI Trading is a wholly-owned subsidiary of Ferrell Companies, Inc., which also
owns Ferrellgas, Inc. Ferrellgas, Inc. is the general partner of both Ferrellgas
Partners and Ferrellgas, L.P.
Pursuant to the Contribution Agreement, FCI Trading has agreed to convert
an entity it intends to acquire, Blue Rhino Corporation, to a limited liability
company, Blue Rhino LLC. FCI Trading's proposed acquisition of Blue Rhino
Corporation will be made pursuant to the terms of an Agreement and Plan of
Merger described below. Upon that conversion, FCI Trading will contribute to
Ferrellgas Partners a portion of the membership interests in Blue Rhino LLC and
Ferrellgas Partners will assume FCI Trading's obligations under the Agreement
and Plan of Merger to pay the consideration of $17.00 per share to the then
former common stockholders of Blue Rhino Corporation together with specific
other obligations.
After that contribution, Ferrellgas Partners will contribute to Ferrellgas,
L.P. its membership interests in Blue Rhino LLC and Ferrellgas, L.P. will assume
Ferrellgas Partners' obligation to pay the merger consideration of $17.00 per
share to the former common stockholders of Blue Rhino Corporation together with
specific other obligations. Blue Rhino LLC will then be merged with and into
Ferrellgas, L.P.
As consideration for FCI Trading's net contribution to Ferrellgas Partners,
Ferrellgas Partners will issue to FCI Trading common units representing limited
partner interests in Ferrellgas Partners. The value of those common units to be
issued will be approximately $8.7 million less the value of the remaining
portion of the membership interests in Blue Rhino LLC to be contributed by
Ferrellgas, Inc. to both Ferrellgas Partners and Ferrellgas, L.P. to maintain
its overall 2% general partner interest in the partnerships as a result of
transactions occurring at or shortly after the closing.
The Contribution Agreement contains standard representations and warranties
and the closing is conditioned upon the closing of the transactions contemplated
by the Agreement and Plan of Merger. The Contribution Agreement will terminate
if the Agreement and Plan of Merger is terminated.
Both FCI Trading and Ferrellgas Partners have agreed to indemnify
Ferrellgas, Inc. from any damages incurred by Ferrellgas, Inc. related to the
assumption of the obligations described above.
A conformed copy of the Contribution Agreement is attached hereto as
Exhibit 2.1 and incorporated herein by reference. The description herein of the
Contribution Agreement and the transactions contemplated thereby is qualified in
its entirety by reference to such exhibit.
1
Agreement and Plan of Merger
FCI Trading is also a party to an Agreement and Plan of Merger dated as of
February 8, 2004, among Blue Rhino Corporation, Diesel Acquisition Corp. LLC,
FCI Trading and Ferrell Companies. Diesel Acquisition was formed solely for the
transactions contemplated by the Agreement and Plan of Merger and is a
wholly-owned subsidiary of FCI Trading. Pursuant to the Agreement and Plan of
Merger, Diesel Acquisition will be merged with and into Blue Rhino Corporation,
with Blue Rhino Corporation being the surviving entity. FCI Trading has agreed
to pay the common stockholders of Blue Rhino Corporation $17.00 per share upon
the closing of the merger.
In addition, each vested stock option and warrant that permits its holder
to purchase common stock of Blue Rhino Corporation and that is outstanding
immediately prior to the merger will be converted into the right to receive a
cash payment from Blue Rhino Corporation equal to the difference between $17.00
per share and the applicable exercise price of the stock option or warrant;
unvested options and warrants not otherwise subject to automatic accelerated
vesting upon a change in control will vest on a pro rata basis, based on their
original vesting date, through the day immediately prior to the closing date of
the merger.
For the merger to occur, several conditions must be met, including the
approval and adoption of the Agreement and Plan of Merger by Blue Rhino
Corporation's stockholders, and the expiration or termination of the applicable
waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
In addition, the Agreement and Plan of Merger may be terminated under a
number of circumstances, including:
o by either FCI Trading or Blue Rhino Corporation, if the merger has not
closed by August 3, 2004;
o by either FCI Trading or Blue Rhino Corporation, if Blue Rhino Corporation
's stockholders do not approve and adopt the Agreement and Plan of Merger
at a special meeting of Blue Rhino Corporation's stockholders;
o by either FCI Trading or Blue Rhino Corporation, if (i) Blue Rhino
Corporation 's Board of Directors approves or recommends to its
stockholders an alternate acquisition proposal made by someone other than
FCI Trading to acquire Blue Rhino Corporation or (ii) Blue Rhino
Corporation receives an unsolicited tender offer to acquire control of Blue
Rhino Corporation, and its Board recommends to its stockholders to either
accept the tender offer or otherwise fails to recommend that its
stockholders reject such tender offer within 10 business days of receiving
notice of the tender offer; however, prior to the termination of the
Agreement and Plan of Merger by Blue Rhino Corporation under these
circumstances, the Board of Directors of Blue Rhino Corporation must
determine in good faith that its failure to accept an alternate acquisition
proposal would constitute a breach of its fiduciary duties; or
2
o by FCI Trading within 10 days after the date of the Blue Rhino Corporation
stockholder's meeting, if FCI Trading and its affiliates have exercised
good faith reasonable best efforts to obtain financing on reasonable
commercial terms (which reasonableness will be determined based on whether
there has been a material adverse change in the pricing then available for
the securities of Ferrellgas Partners from the pricing available as of the
date of the Agreement and Plan of Merger) for the payment of the merger
consideration and have been unable to do so.
If the Agreement and Plan of Merger is terminated by FCI Trading as a result of:
o the failure of the stockholders of Blue Rhino Corporation to approve and
adopt the Agreement and Plan of Merger while an alternate acquisition
proposal is pending; or
o the determination by the Board of Directors of Blue Rhino Corporation that
its failure to accept an alternate acquisition proposal from someone other
than FCI Trading would constitute a breach of its fiduciary duty;
Blue Rhino Corporation would be obligated to pay FCI Trading a termination fee
of $10 million.
If FCI Trading exercises its right to terminate the Agreement and Plan of
Merger due to its and its affiliates failure to obtain financing as described
above, FCI Trading would be obligated to pay Blue Rhino Corporation a
termination fee of $10 million.
If the Agreement and Plan of merger is terminated under any other
circumstance by any party thereto on account of a material and willful breach of
the Merger Agreement, the breaching party is subject to liability under
applicable law.
FCI Trading has also entered into a Voting Agreement with three
stockholders of Blue Rhino Corporation pursuant to which those stockholders have
agreed to vote their shares of common stock of Blue Rhino Corporation in favor
of the merger and to approve and adopt the Agreement and Plan of Merger. Those
shares represent approximately 26.8% of the shares of common stock of Blue Rhino
Corporation entitled to vote.
A conformed copy of the Agreement and Plan of Merger is attached hereto as
Exhibit 99.2 and incorporated herein by reference. The description herein of the
merger and the Agreement and Plan of Merger is qualified in its entirety by
reference to such exhibit.
3
Ancillary Transactions
FCI Trading, Ferrell Companies and Diesel Acquisition would not have
entered into the Agreement and Plan of Merger but for the simultaneous execution
of the Voting Agreement described above and the agreements described below. None
of the transactions contemplated by the following agreements will occur unless
the merger has closed in accordance with the terms of the Agreement and Plan of
Merger.
o Mr. James E. Ferrell, Chairman, President and Chief Executive Officer of
Ferrellgas, Inc., entered into a Unit Purchase Agreement with Ferrellgas
Partners dated February 8, 2004, pursuant to which he has agreed to
purchase common units with an aggregate value of up to $5 million.
o Billy D. Prim, the Chairman and Chief Executive Officer of Blue Rhino,
entered into an Employment Agreement dated February 8, 2004, with Ferrell
Companies, Inc. and Ferrellgas, Inc. that will become effective upon the
closing of the merger in accordance with the terms of the Agreement and
Plan of Merger and that will supercede and replace Mr. Prim's current
Employment Agreement with Blue Rhino Corporation. Mr. Prim is also expected
to be named to the Board of Directors of Ferrellgas, Inc. upon the
effectiveness of this employment agreement.
o Mr. Prim has entered into a Real Property Contribution Agreement with
Ferrellgas Partners dated February 8, 2004, pursuant to which he will
contribute to Ferrellgas Partners real property in Yadkin County, North
Carolina currently leased to Blue Rhino Corporation in exchange for common
units with an aggregate value of $3.15 million.
o Mr. Prim and the other two Blue Rhino Corporation stockholders who executed
the Voting Agreement described above, each entered into Unit Purchase
Agreements with Ferrellgas Partners dated February 8, 2004, pursuant to
which they have agreed to purchase common units with an aggregate value of
$31 million.
o The Blue Rhino Corporation stockholders who entered into the Unit Purchase
Agreements and Real Property Contribution Agreement described above, each
entered into a Registration Rights Agreement with Ferrellgas Partners dated
February 8, 2004, that require Ferrellgas Partners to register the common
units to be acquired by them within 90 days after issuance of those common
units.
A conformed copy of Mr. Ferrell's Unit Purchase Agreement is attached
hereto as Exhibit 99.3 and incorporated herein by reference. The description
herein of the Unit Purchase Agreement is qualified in its entirety by reference
to such exhibit.
4
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
The Exhibits listed in the Index to Exhibits are filed as part of this
Current Report on Form 8-K.
5
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FERRELLGAS PARTNERS, L.P.
By Ferrellgas, Inc., its general partner
Date: February 13, 2004 By /s/ Kevin T. Kelly
-----------------------------------------
Kevin T. Kelly
Senior Vice President and
Chief Financial Officer
FERRELLGAS PARTNERS FINANCE CORP.
Date: February 13, 2004 By /s/ Kevin T. Kelly
-----------------------------------------
Kevin T. Kelly
Senior Vice President and
Chief Financial Officer
FERRELLGAS, L.P.
By Ferrellgas, Inc., its general partner
Date: February 13, 2004 By /s/ Kevin T. Kelly
-----------------------------------------
Kevin T. Kelly
Senior Vice President and
Chief Financial Officer
FERRELLGAS FINANCE CORP.
Date: February 13, 2004 By /s/ Kevin T. Kelly
-----------------------------------------
Kevin T. Kelly
Senior Vice President and
Chief Financial Officer
6
INDEX TO EXHIBITS
-----------------
Exhibit No. Description of Exhibit
----------- ----------------------
2.1 Contribution Agreement dated February 8, 2004, by and among
FCI Trading Corp., Ferrellgas, Inc., Ferrellgas Partners,
L.P. and Ferrellgas, L.P.
99.1 Press Release of Ferrellgas Partners, L.P. dated
February 9, 2004
99.2 Agreement and Plan of Merger, dated as of February 8, 2004,
by and among Blue Rhino Corporation, FCI Trading Corp.,
Diesel Acquisition, LLC, and Ferrell Companies, Inc.
99.3 Unit Purchase Agreement dated February 8, 2004, between
Ferrellgas Partners, L.P. and James E. Ferrell