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What changed in GLOBAL PARTNERS LP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of GLOBAL PARTNERS LP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+333 added−355 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-29)

Top changes in GLOBAL PARTNERS LP's 2024 10-K

333 paragraphs added · 355 removed · 288 edited across 5 sections

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

125 edited+25 added−25 removed326 unchanged
Biggest changeHigher prices for the products we sell may (1) diminish our access to trade credit support and/or cause it to become more expensive and (2) decrease the amount of borrowings available for working capital under our credit agreement as a result of total available commitments, borrowing base limitations and advance rates thereunder. 27 Table of Contents When prices for the products we sell decline, our exposure to risk of loss in the event of nonperformance by our customers of our forward contracts may be increased as they and/or their customers may breach their contracts and purchase the products we sell at the then lower market price from a competitor.
Biggest changeHigher prices for the products we sell may (1) diminish our access to trade credit support and/or cause it to become more expensive and (2) decrease the amount of borrowings available for working capital under our credit agreement as a result of total available commitments, borrowing base limitations and advance rates thereunder.
We may not be able to lease sites we own or lease and/or sub-lease sites we lease with respect to the sale of gasoline and/or related activities on favorable terms and any such failure could adversely affect our financial condition, results of operations and cash available for distribution to our unitholders.
We may not be able to lease sites we own and/or sub-lease sites we lease with respect to the sale of gasoline and/or related activities on favorable terms and any such failure could adversely affect our financial condition, results of operations and cash available for distribution to our unitholders.
Although we expect that much of the income we earn is generally eligible for the 20% deduction for qualified business income for taxable years beginning before December 31, 2025, the Treasury Regulations provide that income attributable to a guaranteed payment for the use of capital is not eligible for the 20% deduction for qualified publicly traded partnership income.
Although we expect that much of the income we earn is generally eligible for the 20% deduction for qualified publicly-traded partnership income for taxable years beginning before December 31, 2025, the Treasury Regulations provide that income attributable to a guaranteed payment for the use of capital is not eligible for the 20% deduction for qualified business income.
Any such transactions involves potential risks, including: ● performance from the acquired assets and businesses or completed growth projects that is below the forecasts we used in evaluating the transaction; ● mistaken assumptions about price, demand, market growth, volumes, revenues and costs, including synergies; ● a project that is behind schedule or in excess of budgeted costs; ● a significant increase in our indebtedness and working capital requirements; ● an inability to hire, train or retain qualified personnel to manage and operate the businesses or assets; 25 Table of Contents ● the inability to timely and effectively integrate the operations of recently acquired businesses or assets, particularly those in new geographic areas or in new lines of business; ● mistaken assumptions about the overall costs of equity or debt; ● the assumption of substantial unknown or unforeseen environmental and other liabilities arising out of the acquired businesses or assets, including liabilities arising from the operation of the acquired businesses or assets prior to our acquisition, for which we are not indemnified or for which the indemnity is inadequate; ● limitations on rights to indemnity from the seller of the acquired assets and businesses; ● customer or key employee loss from the acquired businesses; ● unforeseen difficulties operating in new and existing product areas or new and existing geographic areas; and ● diversion of our management’s and employees’ attention from other business concerns.
Any such transactions involves potential risks, including: ● performance from the acquired assets and businesses or completed growth projects that is below the forecasts we used in evaluating the transaction; 24 Table of Contents ● mistaken assumptions about price, demand, market growth, volumes, revenues and costs, including synergies; ● a project that is behind schedule or in excess of budgeted costs; ● a significant increase in our indebtedness and working capital requirements; ● an inability to hire, train or retain qualified personnel to manage and operate the businesses or assets; ● the inability to timely and effectively integrate the operations of recently acquired businesses or assets, particularly those in new geographic areas or in new lines of business; ● mistaken assumptions about the overall costs of equity or debt; ● the assumption of substantial unknown or unforeseen environmental and other liabilities arising out of the acquired businesses or assets, including liabilities arising from the operation of the acquired businesses or assets prior to our acquisition, for which we are not indemnified or for which the indemnity is inadequate; ● limitations on rights to indemnity from the seller of the acquired assets and businesses; ● customer or key employee loss from the acquired businesses; ● unforeseen difficulties operating in new and existing product areas or new and existing geographic areas; and ● diversion of our management’s and employees’ attention from other business concerns.
Regulations and directives related to these transportation services as well as disruption in any of these transportation services could adversely affect our logistics activities. ● Changes in government usage mandates and tax credits could adversely affect the availability and pricing of ethanol and renewable fuels, which could negatively impact our sales. ● We may not be able to obtain state fund or insurance reimbursement of our environmental remediation costs. 23 Table of Contents ● Our results can be adversely affected by unforeseen events, such as adverse weather, natural disasters, terrorism, cyberattacks, pandemics or other catastrophic events. ● Our businesses, including our gasoline station and convenience store business, expose us to litigation which could result in an unfavorable outcome or settlement of one or more lawsuits where insurance proceeds are insufficient or otherwise unavailable. ● Our businesses are subject to federal, state and municipal environmental and non-environmental regulations which could significantly impact our operations, increase our costs and have a material adverse effect on such businesses. ● Our assets and operations are subject to a series of risks arising from climate change. ● A disruption to our information technology systems, including cybersecurity, could significantly limit our ability to manage and operate our businesses. ● Our general partner and its affiliates have conflicts of interest and limited fiduciary duties, which could permit them to favor their own interests to the detriment of our unitholders. ● Our tax treatment depends on our status as a partnership for federal income tax purposes. ● Unitholders may be required to pay taxes on their share of our income even if they do not receive any cash distributions from us.
Regulations and directives related to these transportation services as well as disruption in any of these transportation services could adversely affect our logistics activities. ● Changes in government usage mandates and tax credits could adversely affect the availability and pricing of ethanol and renewable fuels, which could negatively impact our sales. ● We may not be able to obtain state fund or insurance reimbursement of our environmental remediation costs. ● Our results can be adversely affected by unforeseen events, such as adverse weather, natural disasters, terrorism, cyberattacks, pandemics or other catastrophic events. ● Our businesses, including our gasoline station and convenience store business, expose us to litigation which could result in an unfavorable outcome or settlement of one or more lawsuits where insurance proceeds are insufficient or otherwise unavailable. ● Our businesses are subject to federal, state and municipal environmental and non-environmental regulations which could significantly impact our operations, increase our costs and have a material adverse effect on such businesses. ● Our assets and operations are subject to a series of risks arising from climate change. ● A disruption to our information technology systems, including cybersecurity, could significantly limit our ability to manage and operate our businesses. ● Our general partner and its affiliates have conflicts of interest and limited fiduciary duties, which could permit them to favor their own interests to the detriment of our unitholders. ● Our tax treatment depends on our status as a partnership for federal income tax purposes. ● Unitholders are required to pay taxes on their share of our income even if they do not receive any cash distributions from us.
Additionally, our partnership agreement provides that we, and the officers and directors of our general partner, do not owe any duties, including fiduciary duties, or have any liabilities to holders of our preferred units. ● Our general partner determines the amount and timing of asset purchases and sales, borrowings, issuances of additional partnership securities and reserves, each of which can affect the amount of cash available for distribution to our unitholders. ● Our general partner determines the amount and timing of any capital expenditures and whether a capital expenditure is a maintenance capital expenditure, which reduces distributable cash flow, or a capital expenditure for acquisitions or capital improvements, which does not, and such determination can affect the amount of cash distributed to our unitholders. ● In some instances, our general partner may cause us to borrow funds in order to permit the payment of cash distributions, even if the purpose or effect of the borrowing is to make incentive distributions. ● Our general partner determines which costs incurred by it and its affiliates are reimbursable by us. ● Our partnership agreement does not restrict our general partner from causing us to pay it or its affiliates for any services rendered on terms that are fair and reasonable to us or entering into additional contractual arrangements with any of these entities on our behalf. ● Our general partner intends to limit its liability regarding our contractual and other obligations. ● Our general partner may exercise its limited right to call and purchase common units if it and its affiliates own more than 80% of the common units. ● Our general partner controls the enforcement of obligations owed to us by it and its affiliates. ● Our general partner decides whether to retain separate counsel, accountants or others to perform services for us.
Additionally, our partnership agreement provides that we, and the officers and directors of our general partner, do not owe any duties, including fiduciary duties, or have any liabilities to holders of our preferred units. ● Our general partner determines the amount and timing of asset purchases and sales, borrowings, issuances of additional partnership securities and reserves, each of which can affect the amount of cash available for distribution to our unitholders. 45 Table of Contents ● Our general partner determines the amount and timing of any capital expenditures and whether a capital expenditure is a maintenance capital expenditure, which reduces distributable cash flow, or a capital expenditure for acquisitions or capital improvements, which does not, and such determination can affect the amount of cash distributed to our unitholders. ● In some instances, our general partner may cause us to borrow funds in order to permit the payment of cash distributions, even if the purpose or effect of the borrowing is to make incentive distributions. ● Our general partner determines which costs incurred by it and its affiliates are reimbursable by us. ● Our partnership agreement does not restrict our general partner from causing us to pay it or its affiliates for any services rendered on terms that are fair and reasonable to us or entering into additional contractual arrangements with any of these entities on our behalf. ● Our general partner intends to limit its liability regarding our contractual and other obligations. ● Our general partner may exercise its limited right to call and purchase common units if it and its affiliates own more than 80% of the common units. ● Our general partner controls the enforcement of obligations owed to us by it and its affiliates. ● Our general partner decides whether to retain separate counsel, accountants or others to perform services for us.
Examples include the exercise of its limited call right, its voting rights with respect to the units it owns, its registration rights and its determination whether or not to consent to any merger or consolidation of us; ● provides that our general partner shall not have any liability to us or our unitholders for decisions made in its capacity as general partner so long as it acted in good faith, meaning it believed that the decision was in our best interests; ● generally provides that affiliated transactions and resolutions of conflicts of interest not approved by the conflicts committee of the board of directors of our general partner and not involving a vote of unitholders must be on terms no less favorable to us than those generally being provided to or available from unrelated third parties or be “fair and reasonable” to us and that, in determining whether a transaction or resolution is “fair and reasonable,” our general partner may consider the totality of the relationships between the parties involved, including other transactions that may be particularly advantageous or beneficial to us; and ● provides that our general partner and its officers and directors will not be liable for monetary damages to us, our limited partners or assignees for any acts or omissions unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that the general partner or those other persons acted in bad faith or engaged in fraud or willful misconduct.
Examples include the exercise of its limited call right, its voting rights with respect to the units it owns, its registration rights and its determination whether or not to consent to any merger or consolidation of us; ● provides that our general partner shall not have any liability to us or our unitholders for decisions made in its capacity as general partner so long as it acted in good faith, meaning it believed that the decision was in our best interests; ● generally provides that affiliated transactions and resolutions of conflicts of interest not approved by the conflicts committee of the board of directors of our general partner and not involving a vote of unitholders must be on terms no less favorable to us than those generally being provided to or available from unrelated third parties or be “fair and reasonable” to us and that, in determining whether a transaction or resolution is “fair and reasonable,” our general partner may consider the totality of the relationships between the parties involved, including other transactions that may be particularly advantageous or beneficial to us; and 46 Table of Contents ● provides that our general partner and its officers and directors will not be liable for monetary damages to us, our limited partners or assignees for any acts or omissions unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that the general partner or those other persons acted in bad faith or engaged in fraud or willful misconduct.
Despite our security measures and those of our vendors and suppliers, our information technology and infrastructure may be vulnerable to ransomware, malware or other cyberattacks by hackers, employee error or malfeasance, natural disasters, power loss, telecommunication failures or other disruptions, or as a result of similar disruptions experienced by our business partners, suppliers and/or vendors.
Despite our security measures and those of our vendors and suppliers, our operational and information technology and infrastructure may be vulnerable to ransomware, malware or other cyberattacks by hackers, employee error or malfeasance, natural disasters, power loss, telecommunication failures or other disruptions, or as a result of similar disruptions experienced by our business partners, suppliers and/or vendors.
We have contractual obligations for certain transportation assets such as barges and railcars. A decline in demand for the products we sell could result in a decrease in the utilization of our transportation assets. Certain costs associated with our contractual obligations for certain transportation assets are fixed and do not vary with volumes transported.
A decline in demand for the products we sell could result in a decrease in the utilization of our transportation assets. Certain costs associated with our contractual obligations for certain transportation assets, such as barges and railcars, are fixed and do not vary with volumes transported.
Our common unitholders may not receive cash distributions from us equal to their share of our taxable income or even equal to the tax liability that results from that income. Tax gain or loss on the disposition of our common units could be more or less than expected.
Our common unitholders may not receive cash distributions from us equal to their share of our taxable income or even equal to the actual tax liability that results from that income. Tax gain or loss on the disposition of our common units could be more or less than expected.
Our level of indebtedness could have important consequences to us, including the following: ● our ability to obtain additional financing for working capital, capital expenditures, acquisitions or other purposes may be impaired or such financing may not be available on favorable terms; ● covenants contained in our existing and future credit and debt arrangements will require us to meet financial tests that may affect our flexibility in planning for and reacting to changes in our businesses, including possible acquisition opportunities; 28 Table of Contents ● we will need a substantial portion of our cash flow to make principal and interest payments on our indebtedness, reducing the funds that would otherwise be available for operations, business opportunities and distributions to unitholders; ● our debt level will make us more vulnerable than our competitors with less debt to competitive pressures or a downturn in our businesses; ● our debt level may limit our flexibility in responding to changing businesses and economic conditions; and ● our debt may increase our cost of borrowing.
Our level of indebtedness could have important consequences to us, including the following: ● our ability to obtain additional financing for working capital, capital expenditures, acquisitions or other purposes may be impaired or such financing may not be available on favorable terms; ● covenants contained in our existing and future credit and debt arrangements will require us to meet financial tests that may affect our flexibility in planning for and reacting to changes in our businesses, including possible acquisition opportunities; ● we will need a substantial portion of our cash flow to make principal and interest payments on our indebtedness, reducing the funds that would otherwise be available for operations, business opportunities and distributions to unitholders; ● our debt level will make us more vulnerable than our competitors with less debt to competitive pressures or a downturn in our businesses; ● our debt level may limit our flexibility in responding to changing businesses and economic conditions; and ● our debt may increase our cost of borrowing.
Historical prices for certain products we sell have been volatile and significant changes in such prices in the future may adversely affect our financial condition, results of operations and cash available for distribution to our unitholders. Historical prices for certain products we sell have been volatile.
Historical prices for certain products we sell have been volatile and significant changes in such prices in the future may adversely affect our financial condition, results of operations and cash available for distribution to our unitholders. Prices for certain products we sell have historically been volatile.
The amount of cash we can distribute on our units principally depends upon the amount of cash we generate from our operations, which will fluctuate from quarter to quarter based on, among other things: ● competition from other companies that sell refined petroleum products, gasoline blendstocks, renewable fuels and crude oil and convenience store items and sundries; ● demand for refined petroleum products, gasoline blendstocks, renewable fuels and crude oil in the markets we serve; ● absolute price levels, as well as the volatility of prices, of refined petroleum products, gasoline blendstocks, renewable fuels, RINs and crude oil in both the spot and futures markets; ● supply, extreme weather and logistics disruptions; ● seasonal variation in temperatures which affects demand for home heating oil and residual oil to the extent that it is used for space heating; ● the level of our operating costs, including payments to our general partner; and ● prevailing economic conditions.
The amount of cash we can distribute on our units principally depends upon the amount of cash we generate from our operations, which will fluctuate from quarter to quarter based on, among other things: ● competition from other companies that sell refined petroleum products, gasoline blendstocks, renewable fuels and crude oil and convenience store items and sundries; ● demand for refined petroleum products, gasoline blendstocks, renewable fuels and crude oil in the markets we serve; ● absolute price levels, as well as the volatility of prices, of refined petroleum products, gasoline blendstocks, renewable fuels, RINs and crude oil in both the spot and futures markets; ● supply, extreme weather and logistics disruptions; 23 Table of Contents ● seasonal variation in temperatures which affects demand for home heating oil and residual oil to the extent that it is used for space heating; ● the level of our operating costs, including payments to our general partner; and ● prevailing economic conditions.
As of December 31, 2023, we conducted substantially all of our operations of our end-user business through six subsidiaries that are treated as corporations for U.S. federal income tax purposes. These corporations primarily engage in the retail sale of gasoline and/or operate convenience stores and collect rents on personal property leased to dealers and commissioned agents at other stations.
As of December 31, 2024, we conducted substantially all of our operations of our end-user business through six subsidiaries that are treated as corporations for U.S. federal income tax purposes. These corporations primarily engage in the retail sale of gasoline and/or operate convenience stores and collect rents on personal property leased to dealers and commissioned agents at other stations.
Factors that could lead to a decrease in market demand for products we sell, including refined petroleum products, gasoline blendstocks, renewable fuels and crude oil, include: ● a recession or other adverse economic conditions or an increase in the market price or of an oversupply of refined petroleum products, gasoline blendstocks, renewable fuels and crude oil or higher taxes or other governmental or regulatory actions that increase, directly or indirectly, the cost of gasoline or other refined petroleum products, gasoline blendstocks, renewable fuels and crude oil; ● a shift by consumers to more fuel-efficient or alternative fuel vehicles, including hybrids, or an increase in fuel economy of vehicles, whether as a result of technological advances by manufacturers, governmental or regulatory actions or otherwise; and ● conversion from consumption of home heating oil or residual oil to natural gas and/or electric heat pumps and utilization of propane and/or natural gas (instead of heating oil) as primary fuel sources.
Factors that could lead to a decrease in market demand for products we sell, including refined petroleum products, gasoline blendstocks, renewable fuels and crude oil, include: ● a recession or other adverse economic conditions or an increase in the market price or of an oversupply of refined petroleum products, gasoline blendstocks, renewable fuels and crude oil or higher taxes or other governmental or regulatory actions, such as the imposition of tariffs, that increase, directly or indirectly, the cost of gasoline or other refined petroleum products, gasoline blendstocks, renewable fuels and crude oil; ● a shift by consumers to more fuel-efficient or alternative fuel vehicles, including hybrids, or an increase in fuel economy of vehicles, whether as a result of technological advances by manufacturers, governmental or regulatory actions or otherwise; and ● conversion from consumption of home heating oil or residual oil to natural gas and/or electric heat pumps and utilization of propane and/or natural gas (instead of heating oil) as primary fuel sources.
Several non-traditional retailers, including supermarkets and club stores, compete directly with convenience stores. We face intense competition in our purchasing, selling, gathering, blending, terminalling, transporting and storage.
Several non-traditional retailers, including supermarkets and club stores, compete directly with convenience stores. We face intense competition in our purchasing, selling, gathering, blending, terminalling, transporting and storage activities.
Although our general partner may elect to have our unitholders and former unitholders take such audit adjustment into account and pay any resulting taxes (including applicable penalties or interest) in accordance with their interests in us during the tax year under audit, there can be no assurance that such election will be practical, permissible or effective in all circumstances.
Although our general partner may elect to have our unitholders and former unitholders take such audit adjustments into account and pay any resulting taxes (including applicable penalties or interest) in accordance with their interests in us during the tax year under audit, there can be no assurance that such election will be practical, permissible or effective in all circumstances.
In addition, any noncompliance with our risk management policies could result in significant financial losses. ● We are exposed to trade credit risk and risk associated with our trade credit support in the ordinary course of our businesses. ● Higher prices, new technology and alternative fuels, such as electric, hybrid, battery powered, hydrogen or other alternative fuel-powered motor vehicles, energy efficiency and changing consumer preferences or driving habits could reduce demand for our products. ● We depend upon marine, pipeline, rail and truck transportation services for the petroleum products we purchase and sell.
In addition, any noncompliance with our risk management policies could result in significant financial losses. ● We are exposed to trade credit risk and risk associated with our trade credit support in the ordinary course of 22 Table of Contents our businesses. ● Higher prices, new technology and alternative fuels, such as electric, hybrid, battery powered, hydrogen or other alternative fuel-powered motor vehicles, energy efficiency and changing consumer preferences or driving habits could reduce demand for our products. ● We depend upon marine, pipeline, rail and truck transportation services for the petroleum products we purchase and sell.
In addition, the actual amount of cash we have available for distribution will depend on other factors such as: ● the level of capital expenditures we make; 24 Table of Contents ● the restrictions contained in our credit agreement and the indentures governing our senior notes, including financial covenants, borrowing base limitations and advance rates; ● distributions paid on our preferred units; ● redemptions of some or all of our preferred units; ● our debt service requirements; ● the cost of acquisitions; ● fluctuations in our working capital needs; ● our ability to borrow under our credit agreement to make distributions to our unitholders; and ● the amount of cash reserves established by our general partner.
In addition, the actual amount of cash we have available for distribution will depend on other factors such as: ● the level of capital expenditures we make; ● the restrictions contained in our credit agreement and the indentures governing our senior notes, including financial covenants, borrowing base limitations and advance rates; ● distributions paid on our preferred units; ● redemptions of some or all of our preferred units; ● our debt service requirements; ● the cost of acquisitions; ● fluctuations in our working capital needs; ● our ability to borrow under our credit agreement to make distributions to our unitholders; and ● the amount of cash reserves established by our general partner.
For example, our credit agreement restricts our ability to: ● grant liens; ● make certain loans or investments; ● incur additional indebtedness or guarantee other indebtedness; ● make any material change to the nature of our businesses or undergo a fundamental change; ● make any material dispositions; ● acquire another company; ● enter into a merger, consolidation, sale-leaseback transaction, joint venture transaction or purchase of assets; ● make distributions if any potential default or event of default occurs; or ● modify borrowing base components and advance rates.
For example, our credit agreement restricts our ability to: ● grant liens; ● make certain loans or investments; ● incur additional indebtedness or guarantee other indebtedness; ● make any material change to the nature of our businesses or undergo a fundamental change; ● make any material dispositions; ● acquire another company; 29 Table of Contents ● enter into a merger, consolidation, sale-leaseback transaction, joint venture transaction or purchase of assets; ● make distributions if any potential default or event of default occurs; or ● modify borrowing base components and advance rates.
Due to our limited diversification in asset type and location, an adverse development in these businesses or areas, including 37 Table of Contents adverse developments due to catastrophic events or weather and corresponding decreases in demand for refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, could have a significantly greater impact on our results of operations and cash available for distribution to our unitholders than if we maintained more diverse assets and locations.
Due to our limited diversification in asset type and location, an adverse development in these businesses or areas, including adverse developments due to catastrophic events or weather and corresponding decreases in demand for refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, could have a significantly greater impact on our results of operations and cash available for distribution to our unitholders than if we maintained more diverse assets and locations.
Directors and officers of our general partner’s owners have a 45 Table of Contents fiduciary duty to make these decisions in the best interest of such owners which may be contrary to our interests. ● Some officers of our general partner who provide services to us devote time to affiliates of our general partner. ● Our general partner has limited its liability and reduced its fiduciary duties under the partnership agreement, while also restricting the remedies available to our unitholders for actions that, without these limitations, might constitute breaches of fiduciary duty.
Directors and officers of our general partner’s owners have a fiduciary duty to make these decisions in the best interest of such owners which may be contrary to our interests. ● Some officers of our general partner who provide services to us devote time to affiliates of our general partner. ● Our general partner has limited its liability and reduced its fiduciary duties under the partnership agreement, while also restricting the remedies available to our unitholders for actions that, without these limitations, might constitute breaches of fiduciary duty.
The following summarizes certain of these risks: ● We may not have sufficient cash from operations to enable us to pay distributions on our Series A preferred units or our Series B preferred units (collectively, our “preferred units”) or maintain distributions on our common units at current levels. ● A significant decrease in price or demand for the products we sell or a significant increase in the cost of our logistics activities could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. ● Certain of our financial results are subject to seasonality. · The condition of credit markets may adversely affect our liquidity. ● Covenants and borrowing base limitations included in our debt instruments and our debt levels may limit our flexibility in obtaining additional financing and in pursuing other business opportunities. ● Our risk management policies cannot eliminate all commodity risk, basis risk or the impact of unfavorable market conditions.
The following summarizes certain of these risks: ● We may not have sufficient cash from operations to enable us to pay distributions on our Series B preferred units (“preferred units”) or maintain distributions on our common units at current levels. ● A significant decrease in price or demand for the products we sell or a significant increase in the cost of our logistics activities could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. · Tariffs could significantly impact our operations and costs, adversely affecting our business. ● Certain of our financial results are subject to seasonality. · The condition of credit markets may adversely affect our liquidity. ● Covenants and borrowing base limitations included in our debt instruments and our debt levels may limit our flexibility in obtaining additional financing and in pursuing other business opportunities. ● Our risk management policies cannot eliminate all commodity risk, basis risk or the impact of unfavorable market conditions.
Further, any actual or perceived failure to comply with any new or existing laws, regulations and other obligations could result in fines, penalties or other liability. We depend on key personnel for the success of our businesses. We depend on the services of our senior management team and other key personnel.
Further, any actual or perceived failure to comply with any new or existing laws, regulations and other obligations could result in fines, penalties, reputational harm or other liability. We depend on key personnel for the success of our businesses. We depend on the services of our senior management team and other key personnel.
Due to our limited asset and geographic diversification, adverse developments in the terminals we use or in our operating areas would reduce our ability to make distributions to our unitholders. We rely primarily on sales generated from products distributed from terminals we own or control or to which we have access.
Due to our limited asset and geographic diversification, adverse developments in the terminals we use or in our operating areas could reduce our ability to make distributions to our unitholders. We rely primarily on sales generated from products distributed from terminals we own or control or to which we have access.
A unitholder could be liable for our obligations as if he were a general partner if: ● a court or government agency determined that we were conducting business in a state but had not complied with that particular state’s partnership statute; or 50 Table of Contents ● a unitholder’s right to act with other unitholders to remove or replace the general partner, approve some amendments to our partnership agreement or take other actions under our partnership agreement constitute “control” of our businesses.
A unitholder could be liable for our obligations as if he were a general partner if: ● a court or government agency determined that we were conducting business in a state but had not complied with that particular state’s partnership statute; or ● a unitholder’s right to act with other unitholders to remove or replace the general partner, approve some amendments to our partnership agreement or take other actions under our partnership agreement constitute “control” of our businesses.
If these lease and terminalling agreements are not renewed or we are unable to renew them at rates and on terms and conditions satisfactory us or we are otherwise unable to replace such dedicated storage as may be needed, it could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders.
If these lease and terminalling agreements are not renewed or we are unable to renew them at rates and on terms and conditions 36 Table of Contents satisfactory us or we are otherwise unable to replace such dedicated storage as may be needed, it could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders.
While the determination of a partner’s “amount realized” generally includes any decrease of a partner’s share of the partnership’s liabilities, the Treasury regulations provide that the “amount realized” on a transfer of an interest in a publicly traded partnership, such as our units, will generally be the amount of gross proceeds paid to the broker effecting the applicable transfer on behalf of the transferor, and thus will be determined without regard to any decrease in that 54 Table of Contents partner’s share of a publicly traded partnership’s liabilities.
While the determination of a partner’s “amount realized” generally includes any decrease of a partner’s share of the partnership’s liabilities, the Treasury regulations provide that the “amount realized” on a transfer of an interest in a publicly traded partnership, such as our units, will generally be the amount of gross proceeds paid to the broker effecting the applicable transfer on behalf of the transferor, and thus will be determined without regard to any decrease in that partner’s share of a publicly traded partnership’s liabilities.
Basis risk cannot be entirely eliminated, and basis exposure, particularly in backward or other adverse market conditions, can adversely affect our financial condition, results of operations and cash available for distribution to our unitholders. 32 Table of Contents We monitor processes and procedures to prevent unauthorized trading and to maintain substantial balance between purchases and sales or future delivery obligations.
Basis risk cannot be entirely eliminated, and basis exposure, particularly in backward or other adverse market conditions, can adversely affect our financial condition, results of operations and cash available for distribution to our unitholders. We monitor processes and procedures to prevent unauthorized trading and to maintain substantial balance between purchases and sales or future delivery obligations.
Increased conservation and technological advances have adversely affected the demand for home heating oil and residual oil. Consumption of residual oil has steadily declined over the last several decades. We could face additional competition from alternative energy sources as a result of future government-mandated controls or regulations further promoting the use of cleaner fuels.
Increased conservation and technological advances have adversely affected the demand for home heating oil and residual oil. Consumption of residual oil has steadily declined over the last several decades. We could face additional competition from alternative energy sources as a result of future government-mandated controls or regulations further promoting the use of cleaner fuels or changing consumer preferences.
The Act and any new regulations could significantly increase the cost of derivative contracts (including from swap recordkeeping and reporting requirements and through requirements to post collateral which could adversely affect our available liquidity), materially alter the terms of derivative contracts, reduce the availability of some derivatives to protect against risks we encounter and reduce our ability to monetize or restructure our existing derivative contracts.
The Act and any new regulations could significantly increase the cost of derivative contracts (including from swap recordkeeping and reporting requirements and through requirements to post collateral which could adversely affect our available liquidity), materially alter the terms of derivative contracts, reduce 31 Table of Contents the availability of some derivatives to protect against risks we encounter and reduce our ability to monetize or restructure our existing derivative contracts.
Any such access, disclosure or other loss of information or loss of access to information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, regulatory penalties, disruption of our operations, damage to our reputation, and loss of confidence in our ability to supply our products and services or maintain the security of information we collect and store, which could adversely affect our business.
Any such access, disclosure or other loss of information or loss of access to information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, regulatory penalties, disruption of our operations, damage to our reputation, and loss of confidence in our ability to supply our products and services or maintain the 43 Table of Contents security of information we collect and store, which could adversely affect our business.
Increasing attention to, and social expectations on, companies to address climate change and other environmental and social impacts, investor and societal explanations regarding voluntary ESG disclosures, and increased consumer demand for alternative forms of energy may result in increased costs, reduced demand for our 40 Table of Contents products, reduced profits, increased investigations and litigation, and negative impacts on our unit price and access to capital markets.
Increasing attention to, and social expectations on, companies to address climate change and other environmental and social impacts, investor and societal explanations regarding voluntary ESG disclosures, and increased consumer demand for alternative forms of energy may result in increased costs, reduced demand for our products, reduced profits, increased investigations and litigation, and negative impacts on our unit price and access to capital markets.
These systems are vulnerable to, among other things, damage and interruption from power loss or natural disasters, computer system and network failures, loss of telecommunication services, physical and electronic loss of data, cyber and other security breaches and computer viruses.
These systems are vulnerable to, among other things, damage and interruption from power loss or natural disasters, computer system and network failures, loss of telecommunication services, physical and electronic loss of data, cybersecurity and other security breaches and computer viruses.
If, as a result of any such audit adjustment, we are required to make payments of taxes, penalties and interest, our cash available for distribution to our unitholders might be substantially reduced and our current and former unitholders may be required to indemnify us for any taxes (including any applicable penalties and interest) resulting from such audit adjustments that were paid on such unitholders’ behalf.
If, as a result of any such audit adjustment, we are required to make payments of taxes, penalties and interest, our cash available for distribution to our unitholders might be substantially reduced and our 52 Table of Contents current and former unitholders may be required to indemnify us for any taxes (including any applicable penalties and interest) resulting from such audit adjustments that were paid on such unitholders’ behalf.
Any subsequent refinancing of our current debt or any new debt could have similar restrictions. For more information regarding our credit agreement and indentures, please read Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Credit Agreement” and Note 9 of Notes to Consolidated Financial Statements.
Any subsequent refinancing of our current debt or any new debt could have similar restrictions. For more information regarding our credit agreement and indentures, please read Part II, Item 7, “Management’s Discussion and 30 Table of Contents Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Credit Agreement” and Note 9 of Notes to Consolidated Financial Statements.
Additionally, our access to trade credit support could diminish and/or become more expensive. Our ability to continue to receive sufficient trade credit on commercially acceptable terms could be adversely affected by fluctuations in prices of petroleum products, renewable fuels and other products we sell or disruptions in the credit markets or for any other reason.
Additionally, our access to trade credit support could diminish and/or become more expensive. Our ability to continue to receive sufficient trade credit on commercially acceptable terms could be adversely affected by fluctuations in prices of petroleum products, renewable fuels and other products we sell or disruptions in the credit markets or for any 32 Table of Contents other reason.
Although the litigation is varied, many such suits allege that oil and gas companies have created public nuisances by producing fuels that contribute to climate change or allege that the companies have been aware of the adverse effects of climate change for some time but failed to adequately disclose those impacts to their investors and customers.
Although the litigation is varied, many such suits allege that oil and gas companies have 39 Table of Contents created public nuisances by producing fuels that contribute to climate change or allege that the companies have been aware of the adverse effects of climate change for some time but failed to adequately disclose those impacts to their investors and customers.
Our terminalling operations involving the receipt, storage and delivery of primarily refined petroleum products, gasoline blendstocks, renewable fuels and crude oil are subject to stringent federal, 38 Table of Contents state and municipal laws and regulations governing the discharge of materials into the environment, or otherwise relating to the protection of the environment, operational safety and related matters.
Our terminalling operations involving the receipt, storage and delivery of primarily refined petroleum products, gasoline blendstocks, renewable fuels and crude oil are subject to stringent federal, state and municipal laws and regulations governing the discharge of materials into the environment, or otherwise relating to the protection of the environment, operational safety and related matters.
We might not have, or be able to obtain, sufficient funds to make 30 Table of Contents these accelerated payments. In addition, our obligations under our credit agreement are secured by substantially all of our assets, and if we are unable to repay our indebtedness under our credit agreement, the lenders could seek to foreclose on such assets.
We might not have, or be able to obtain, sufficient funds to make these accelerated payments. In addition, our obligations under our credit agreement are secured by substantially all of our assets, and if we are unable to repay our indebtedness under our credit agreement, the lenders could seek to foreclose on such assets.
Our partnership agreement also contains provisions limiting the ability of unitholders to call meetings or acquire information about our operations, as well as other provisions limiting the unitholders’ ability to influence the manner or direction of management. Cost reimbursements due to our general partner and its affiliates will reduce cash available for distribution to our unitholders.
Our partnership agreement also contains provisions limiting the ability of unitholders to call meetings or acquire information about our operations, as well as other provisions limiting the unitholders’ ability to influence the manner or direction of management. 49 Table of Contents Cost reimbursements due to our general partner and its affiliates will reduce cash available for distribution to our unitholders.
These factors could materially affect the sale of this product mix which in turn could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. Our financial condition, results of operations, and cash available for distribution to our unitholders may be adversely affected by global and national health concerns.
These factors could materially affect the sale of this product mix which in turn could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. 35 Table of Contents Our financial condition, results of operations, and cash available for distribution to our unitholders may be adversely affected by global and national health concerns.
Our partnership agreement contains provisions that reduce the standards to which our general partner would otherwise be held by state fiduciary duty law. Our partnership agreement provides that we, and the officers and directors 46 Table of Contents of our general partner, do not owe any duties, including fiduciary duties, or have any liabilities to holders of our preferred units.
Our partnership agreement contains provisions that reduce the standards to which our general partner would otherwise be held by state fiduciary duty law. Our partnership agreement provides that we, and the officers and directors of our general partner, do not owe any duties, including fiduciary duties, or have any liabilities to holders of our preferred units.
Additionally, all or part of any gain recognized by such tax-exempt organization upon a sale or other disposition of our units may be unrelated business taxable income and may be taxable to them. Tax-exempt entities should consult a tax advisor before investing in our common units. Non-U.S.
Additionally, all or part of any gain recognized by such tax-exempt organization upon a sale or other disposition of our units may be unrelated business taxable income and may be taxable to them. Tax-exempt entities should consult a tax advisor before investing in our common units. 53 Table of Contents Non-U.S.
We may not be able to effect any of these remedies on satisfactory terms or at all. A significant increase in interest rates could adversely affect our ability to service our indebtedness. The interest rates on our credit agreement are variable; therefore, we have exposure to movements in interest rates.
We may not be able to effect any of these remedies on satisfactory terms or at all. 28 Table of Contents A significant increase in interest rates could adversely affect our ability to service our indebtedness. The interest rates on our credit agreement are variable; therefore, we have exposure to movements in interest rates.
We rely on our information technology systems, including cybersecurity, to manage numerous aspects of our businesses, and a disruption of these systems could adversely affect our businesses. We depend on our information technology (“IT”) systems to manage numerous aspects of our businesses and to provide analytical information to management.
We rely on our operational and information technology systems, including cybersecurity, to manage numerous aspects of our businesses, and a disruption of these systems could adversely affect our businesses. We depend on our operational and information technology systems to manage numerous aspects of our businesses and to provide analytical information to management.
To the extent possible under these rules, our general partner may elect to either pay the taxes (including any applicable penalties and interest) directly to the IRS or, if we are eligible, issue a revised information statement to each unitholder and former unitholder with respect to an audited and adjusted return.
To the extent possible, our general partner may elect to either pay the taxes (including any applicable penalties and interest) directly to the IRS or, if we are eligible, issue a revised information statement to each unitholder and former unitholder with respect to an audited and adjusted return.
Although we expect to qualify for the end-user exception from such margin requirements for swaps entered into to hedge our commercial 31 Table of Contents risks, the application of such requirements to other market participants, such as swap dealers, may change the cost and availability of the swaps that we use for hedging.
Although we expect to qualify for the end-user exception from such margin requirements for swaps entered into to hedge our commercial risks, the application of such requirements to other market participants, such as swap dealers, may change the cost and availability of the swaps that we use for hedging.
Because holders of our preferred units will generally not be allocated a share of our items of depreciation, depletion or amortization, it is not anticipated that such holders will be required to recharacterize any 56 Table of Contents portion of their gain as ordinary income as a result of the recapture rules.
Because holders of our preferred units will generally not be allocated a share of our items of depreciation, depletion or amortization, it is not anticipated that such holders will be required to recharacterize any portion of their gain as ordinary income as a result of the recapture rules.
A reduction in our sales could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. 33 Table of Contents Energy efficiency, higher prices, new technology and alternative fuels could reduce demand for our heating oil and residual oil.
A reduction in our sales could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. Energy efficiency, higher prices, new technology and alternative fuels could reduce demand for our heating oil and residual oil.
While we believe we have adequate systems and controls in place, we are continuously working to install new, and upgrade existing, information technology systems and provide employee awareness around phishing, malware and other cyber risks in an effort to ensure that we are protected against cyber risks and security breaches.
While we believe we have adequate systems and controls in place, we are continuously working to install new, and upgrade existing, operational and information technology systems and provide employee awareness around phishing, malware and other cybersecurity risks in an effort to ensure that we are protected against cybersecurity risks and security breaches.
There can be no assurance that there will not be further changes to U.S. federal income tax laws or the Treasury Department’s interpretation of the qualifying income rules in a manner that could impact our ability to qualify as a partnership in the future.
There can be no assurance that there will not be further changes to U.S. federal 51 Table of Contents income tax laws or the Treasury Department’s interpretation of the qualifying income rules in a manner that could impact our ability to qualify as a partnership in the future.
If the IRS were to contest the U.S. federal income tax positions we take, it may adversely impact the market for our 52 Table of Contents units, and the costs of any such contest would reduce our cash available for distribution to our unitholders.
If the IRS were to contest the U.S. federal income tax positions we take, it may adversely impact the market for our units, and the costs of any such contest would reduce our cash available for distribution to our unitholders.
While we believe we have adequate cyber and other security controls over individually identifiable customer, employee and vendor data provided to us, a breakdown or a breach in our systems that results in the unauthorized release of individually identifiable customer or other sensitive data could nonetheless occur and have a material adverse effect on our reputation, operating results and financial condition.
While we believe we have adequate cybersecurity and other security controls over personally identifiable customer, employee and vendor data provided to us, a breakdown or a breach in our systems that results in the unauthorized release of personally identifiable customer or other sensitive data could nonetheless occur and have a material adverse effect on our reputation, operating results and financial condition.
Rule 144 under the Securities Act provides that after a holding period of six months, non-affiliates may resell restricted securities of reporting companies, provided that current public information for the reporting company is available.
Rule 144 under the Securities Act provides that after a 48 Table of Contents holding period of six months, non-affiliates may resell restricted securities of reporting companies, provided that current public information for the reporting company is available.
The IRS may challenge these valuation 55 Table of Contents methods and the resulting allocations of income, gain, loss and deduction. A successful IRS challenge to these methods or allocations could adversely affect the timing or amount of taxable income or loss being allocated to our unitholders.
The IRS may challenge these valuation methods and the resulting allocations of income, gain, loss and deduction. A successful IRS challenge to these methods or allocations could adversely affect the timing or amount of taxable income or loss being allocated to our unitholders.
While there have been incidents of security breaches and unauthorized access to our information technologies, we have not experienced any material impact to our operations or business as a result of these attacks; however, other similar incidents could have a significant negative impact on our systems and operations.
While there have been incidents of security breaches and unauthorized access to our operational and information technologies and those of our vendors and suppliers, we have not experienced any material impact to our operations or business as a result of these attacks; however, other similar incidents could have a significant negative impact on our systems and operations.
We are allowed to 47 Table of Contents issue additional preferred units and parity securities without any vote of the holders of our preferred units, except where the cumulative distributions on our preferred units or any parity securities are in arrears.
We are allowed to issue additional preferred units and parity securities without any vote of the holders of our preferred units, except where the cumulative distributions on our preferred units or any parity securities are in arrears.
Private parties, including the owners of properties located near our terminal facilities and those with whom we do business, also may have the right to pursue legal actions against us to enforce compliance with environmental laws, as well as seek damages for personal injury or property damage. We may also be held liable for damages to natural resources.
Private parties, including the owners of properties located near our terminal facilities and those with whom we do business, also may have the right to pursue legal actions against us to enforce compliance with environmental laws, as well as seek damages for personal injury or property damage.
A reduction or waiver of the RFS mandate or oxygenate blending requirements could 34 Table of Contents adversely affect the availability and pricing of ethanol, which in turn could adversely affect our future gasoline and ethanol sales.
A reduction or waiver of the RFS mandate or oxygenate blending requirements could adversely affect the availability and pricing of ethanol, which in turn could adversely affect our future gasoline and ethanol sales.
Additionally, institutional lenders may decide not to provide funding for fossil fuel energy companies or the corresponding infrastructure projects based on climate change related concerns, which could affect our access to capital for potential growth projects.
Additionally, institutional lenders may decide not to provide funding for fossil fuel energy companies or the corresponding infrastructure projects 40 Table of Contents based on climate change related concerns, which could affect our access to capital for potential growth projects.
All holders of our preferred units are urged to consult a tax advisor with respect to the consequences of owning our preferred units. Item 1B. Unresolved Staff Comments . None.
All holders of our preferred units are urged to consult a tax advisor with respect to the consequences of owning our preferred units. Item 1B. Unresolved Staff Comments . None. 56 Table of Contents
Richard Slifka and Eric Slifka and certain affiliates of our general partner from owning certain assets or engaging in certain businesses that compete directly or indirectly with us.
Richard Slifka and Eric Slifka and certain 50 Table of Contents affiliates of our general partner from owning certain assets or engaging in certain businesses that compete directly or indirectly with us.
If we do not pay the required distributions on our preferred units, we will be unable to pay distributions on our common units. Additionally, because distributions to our preferred units are cumulative, we will have to pay all unpaid accumulated preferred distributions before we can pay any distributions to our common unitholders.
If we do not pay the required distributions on our preferred units, we will be unable to pay distributions on our common units. Additionally, because 47 Table of Contents distributions to our preferred units are cumulative, we will have to pay all unpaid accumulated preferred distributions before we can pay any distributions to our common unitholders.
Finally, public statements with respect to ESG matters, such as emissions reduction goals, other environmental targets, or other commitments addressing certain social issues, are becoming increasingly subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” i.e., misleading information or false claims overstating potential ESG benefits.
Finally, public statements with respect to certain matters, such as emissions reduction goals, other environmental targets, or other commitments addressing certain social issues, have been subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” i.e., misleading information or false claims overstating potential benefits.
We are currently involved in two joint ventures. We may not always be in complete alignment with our unaffiliated joint venture counterparties due to, for example, conflicting strategic objectives, change in control, change in market conditions or applicable laws, or other events.
We are currently involved in two joint ventures accounted for using the equity method. We may not always be in complete alignment with our unaffiliated joint venture counterparties due to, for example, conflicting strategic objectives, change in control, change in market conditions or applicable laws, or other events.
Moreover, federal regulators and state and local governments have taken (or announced that they plan to take) actions that have or may 39 Table of Contents have a significant influence on our operations.
Moreover, federal regulators and state and local governments have taken (or announced that they plan to take) actions that have or may have a significant influence on our operations.
The secure storage, processing, maintenance and transmission of this 43 Table of Contents information is critical to our operations and business strategy.
The secure storage, processing, maintenance and transmission of this information is critical to our operations and business strategy.
Effective February 8, 2024, we have the ability to incur additional debt, including the capacity to borrow up to $1.55 billion under our credit agreement, subject to limitations in our credit agreement.
We have the ability to incur additional debt, including the capacity to borrow up to $1.55 billion under our credit agreement, subject to limitations in our credit agreement.
As of February 22, 2024, affiliates of our general partner, including directors and executive officers and their affiliates, owned 19.1% of our common units and the entire general partner interest.
As of February 21, 2025, affiliates of our general partner, including directors and executive officers and their affiliates, owned 19.1% of our common units and the entire general partner interest.
Our partnership agreement defines “Available Cash” to generally mean, for each fiscal quarter, all cash and cash equivalents on hand on the date of determination of available cash with respect to such quarter, less the amount of any cash reserves established by our general partner to: ● provide for the proper conduct of our businesses; ● comply with applicable law or the terms of any of our debt instruments or other agreements; or ● provide funds for distributions to holders of our common units and preferred units for any one or more of the next four quarters. 48 Table of Contents As a result, we do not expect to accumulate significant amounts of cash.
Our partnership agreement defines “Available Cash” to generally mean, for each fiscal quarter, all cash and cash equivalents on hand on the date of determination of available cash with respect to such quarter, less the amount of any cash reserves established by our general partner to: ● provide for the proper conduct of our businesses; ● comply with applicable law or the terms of any of our debt instruments or other agreements; or ● provide funds for distributions to holders of our common units and preferred units for any one or more of the next four quarters.
An increase in market interest rates, which are currently at low levels relative to historical rates, may lead prospective purchasers of our preferred units to expect a higher distribution yield, and higher interest rates would likely increase our borrowing costs and potentially decrease funds available for distribution to our limited partners, including the holders of our preferred units.
An increase in market interest rates may lead prospective purchasers of our preferred units to expect a higher distribution yield, and higher interest rates would likely increase our borrowing costs and potentially decrease funds available for distribution to our limited partners, including the holders of our preferred units.
Such agency action could also increase the potential for private litigation. Relatedly, California has enacted new laws requiring additional disclosure with respect to certain climate-related risks and GHG emissions reduction claims. Non-compliance with these new laws may result in the imposition of substantial fines or penalties. Other states are considering similar laws.
Relatedly, California has enacted new laws requiring additional disclosure with respect to certain climate-related risks and GHG emissions reduction claims. Non-compliance with these new laws may result in the imposition of substantial fines or penalties. Other states are considering similar laws.
“Business and Properties—Regulation.” Our assets and operations are subject to a series of risks arising from climate change. The threat of climate change continues to attract considerable attention. In the United States, no comprehensive climate change legislation has been implemented at the federal level.
“Business and Properties—Regulation.” Our assets and operations are subject to a series of risks arising from climate change. The threat of climate change continues to attract considerable attention. In the United States, no comprehensive climate change legislation has been implemented at the federal level. However, while in office, President Biden made action on climate change a priority of his administration.
Therefore, treatment of us as a corporation would result in a material reduction in the anticipated cash flow and after-tax return to our unitholders, likely causing a substantial reduction in the value of our common units.
Because a tax would be imposed upon us as a corporation, our cash available for distribution to our unitholders would be substantially reduced. Therefore, treatment of us as a corporation would result in a material reduction in the anticipated cash flow and after-tax return to our unitholders, likely causing a substantial reduction in the value of our common units.
A significant change in any of these factors could materially impact our customers’ needs, motor fuel gallon volumes, gross profit and overall customer traffic, which in turn could have a material adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders.
A significant change in any of these factors could materially impact our customers’ needs, motor fuel gallon volumes, gross profit and overall customer traffic, which in turn could have a material adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. 27 Table of Contents We have contractual obligations for certain transportation assets such as barges and railcars.
Our IT systems are an essential component of our businesses and growth 44 Table of Contents strategies, and a serious disruption to our IT systems could significantly limit our ability to manage and operate our businesses effectively.
Our operational and information technology systems are an essential component of our businesses and growth strategies, and a serious disruption to our operational and information technology systems could significantly limit our ability to manage and operate our businesses effectively.
Additionally, we could face increasing costs as we attempt to comply with and navigate further regulatory focus and scrutiny. 41 Table of Contents Our businesses involve the buying, selling, gathering, blending and shipping of refined petroleum products, gasoline blendstocks, renewable fuels and crude oil by various modes of transportation, which involves risks of derailment, accidents and liabilities associated with cleanup and damages, as well as potential regulatory changes that may adversely impact our businesses, financial condition or results of operations.
Our businesses involve the buying, selling, gathering, blending and shipping of refined petroleum products, gasoline blendstocks, renewable fuels and crude oil by various modes of transportation, which involves risks of derailment, accidents and liabilities associated with cleanup and damages, as well as potential regulatory changes that may adversely impact our businesses, financial condition or results of operations.
We are subject to federal, state and municipal environmental regulations which could have a material adverse effect on our retail operations business and results of operations.
We are subject to federal, state and municipal non-environmental regulations which could have an adverse effect on our convenience store business and results of operations.
If funding is not available when needed, or is available only on unfavorable terms, we may be unable to maintain our businesses as currently conducted, enhance our existing businesses, complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders. 29 Table of Contents Operating and financial restrictions and covenants in our credit agreement and the indentures governing our senior notes and borrowing base requirements in our credit agreement may restrict our business and financing activities.
If funding is not available when needed, or is available only on unfavorable terms, we may be unable to maintain our businesses as currently conducted, enhance our existing businesses, complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeGovernance We have an internal cybersecurity risk management team consisting of our cybersecurity operations team, cybersecurity engineering team and data privacy and data security team, all reporting to our Chief Information Security Officer (“CISO”). This team is responsible for overseeing cybersecurity threats and assessing and managing material risks from cybersecurity threats.
Biggest changeThis team is responsible for identifying and managing cybersecurity threats and assessing and managing material risks from cybersecurity threats. With more than two decades of cybersecurity and information security experience, our CISO leads our cybersecurity risk management team and holds certifications including CISSP, CISA, CISM, and CRISC.
See “Item 1A, Risk Factors,” for additional information about the risks to our business associated with a breach or compromise to our information technology systems. Item 3. Legal Proceedings . The information required by this item is included in Note 25 of Notes to Consolidated Financial Statements and is incorporated herein by reference. Item 4.
See “Part I, Item 1A, Risk Factors,” for additional information about the risks to our business associated with a breach or compromise to our information technology systems. Item 3. Legal Proceedings . The information required by this item is included in Note 24 of Notes to Consolidated Financial Statements and is incorporated herein by reference. Item 4.
We have a management-level cybersecurity committee that has primary responsibility for our overall cybersecurity risk management program and oversees our internal cybersecurity personnel and retained external cybersecurity consultants. The cybersecurity committee includes our Chief Financial Officer, CIO) CLO and our Director of Internal Audit.
We have a management-level cybersecurity committee that has primary responsibility for our overall cybersecurity risk management program and oversees our internal cybersecurity personnel and retained external cybersecurity consultants and applicable third-party service providers. The cybersecurity committee includes our Chief Financial Officer, CIO, CLO and our Director of Internal Audit.
Mine Safety Disclosure s Not applicable. ​ 59 Table of Contents PART I I
Mine Safety Disclosure s Not applicable. ​ 58 Table of Contents PART I I
In addition, we have implemented measures designed to address the risks associated with the use of industrial control systems to help 57 Table of Contents maintain the reliability and safety of our operations.
We have implemented measures designed to address the risks associated with the use of industrial control systems to help maintain the reliability and safety of our operations.
We have also implemented a threat hunting program designed to seek out and identify potential cybersecurity threats in our systems. We require all employees and contractors to participate in cybersecurity training designed to enhance their understanding of cyber threats and their ability to identify and escalate potential incidents.
We also operate a threat hunting program to help us identify potential cybersecurity threats in our systems. We require all employees and contractors to participate in cybersecurity training designed to enhance their understanding of cybersecurity threats and their ability to identify and escalate potential incidents.
However, we acknowledge that cybersecurity threats are continually evolving, and the possibility of future cybersecurity incidents remains. Despite the implementation of our cybersecurity processes, our security measures cannot guarantee that a significant cyberattack will not occur. A successful attack on our information technology systems could have significant consequences to the business.
However, we acknowledge that cybersecurity threats are continually evolving, and the possibility of future cybersecurity incidents remains. Despite the implementation of our cybersecurity risk management program and governance structure, we cannot guarantee that a significant cyberattack will not occur. A successful attack on our operational and information technology or other business systems could have significant consequences to the business.
Our business is dependent upon our computer systems, devices, software and networks (operational and information technology) to collect, process and store the data necessary to conduct almost all aspects of our business.
Our business is dependent upon our computer systems, devices, software and networks (operational and information technology) to process the data necessary to conduct our business.
Item 1C. Cybersecurity. Risk Management and Strategy ​ In the ordinary course of our business, we collect and store sensitive data including, without limitation, our proprietary business information and that of our customers, suppliers and business partners, information with respect to potential ventures and transactions, and personally identifiable information of our employees, customers and business partners.
Item 1C. Cybersecurity. Risk Management and Strategy ​ In the ordinary course of our business, we collect and store data, including sensitive data such as our proprietary business information and that of our customers, suppliers and business partners, information related to potential ventures and transactions, and personal information related to our employees, customers and business partners.
Our CISO meets with the members of the cybersecurity committee regularly, together with other members of the internal cybersecurity risk management team, to provide updates on cybersecurity issues and risk management activities related to preventing, detecting and mitigating cybersecurity incidents. Our cybersecurity committee monitors the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents.
Our CISO and members of the internal cybersecurity risk management team regularly meet with the cybersecurity committee to provide updates on cybersecurity threats, risk management activities and other issues related to preventing, detecting and mitigating cybersecurity incidents.
Our information technology and operational technology disaster recovery program is designed to help maintain the continuity of critical business operations in the event of a disruptive cybersecurity incident through procedures for data recovery, system restoration, and business resumption.
Our information technology and operational technology disaster recovery program is designed to help maintain the continuity of critical business operations in the event of a disruptive cybersecurity incident through procedures for data recovery, system restoration, and business resumption. We engage third-party cybersecurity consultants to provide cybersecurity audits, targeted attack testing, cybersecurity threat intelligence and cybersecurity incident response services.
Impacts from Cybersecurity Threats As of the date of this report, though we and our service providers have been subject to certain cybersecurity incidents, we are not aware of any previous cybersecurity threats that have materially affected or are reasonably likely to 58 Table of Contents materially affect us.
Impacts from Cybersecurity Threats As of the date of this report, though we and our service providers have experienced certain cybersecurity incidents, we are not aware of any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
We conduct an annual “tabletop” exercise during which we simulate cybersecurity incidents to help us prepare to respond to a cybersecurity incident and to identify areas for potential improvement.
We aim to test the IR plan at least annually to assess its operational effectiveness. We strive to conduct an annual “tabletop” exercise during which we simulate cybersecurity incidents to help us prepare for and respond to a cybersecurity incident and to identify areas for potential improvement.
We also have implemented an incident response plan that is designed to facilitate our response to cybersecurity incidents and escalation of cybersecurity incidents deemed to have a moderate or higher business impact, even if immaterial to us, to our executive officers, other members of our senior management team and other internal stakeholders.
Our cybersecurity risk management program includes an incident response (“IR”) plan that is designed to facilitate our response to cybersecurity incidents, including an escalation process for cybersecurity incidents that may have a moderate or higher business impact to notify our executive officers, other members of our senior management team and other internal stakeholders.
These exercises are conducted in close coordination with members of our internal cybersecurity risk management team, our retained cybersecurity incident response consultants, outside cybersecurity counsel and internal technical, operations, insurance risk management, internal audit and legal personnel, as well as certain executive officers and members of the senior management team.
These exercises are conducted in close coordination with members of our internal cybersecurity risk management team, our retained cybersecurity incident response consultants, outside cybersecurity counsel and internal technical, operations and insurance risk management, internal audit and legal personnel, as well as certain executive officers and members of the senior management team. 57 Table of Contents Governance We have an internal cybersecurity risk management team consisting of our cybersecurity operations team, cybersecurity engineering team and data privacy and data security compliance team that reports to our Chief Information Security Officer (“CISO”).
Our cybersecurity committee also consults with internal and external cybersecurity personnel and threat intelligence, obtains other information from governmental, public or private sources, and communicates with senior management about cybersecurity threats and resources for managing them. Our Board of Directors (the “Board”) oversees our cybersecurity risk management activities.
Our cybersecurity committee also consults with internal and external cybersecurity and threat intelligence consultants and communicates with senior management about cybersecurity threats and resource needs for managing them. Our Board of Directors (the “Board”) oversees all cybersecurity risk management activities.
With over two decades of cybersecurity and information security experience, our CISO leads our cybersecurity risk management team and holds certifications including CISSP, CISA, CISM, and CRISC. Leveraging their cybersecurity experience, knowledge of our company and leadership, our CISO plays an important role in both the strategic development and tactical execution of our cybersecurity risk management program.
Leveraging their cybersecurity experience, knowledge of our company and leadership, our CISO plays an important role in both the strategic development and tactical execution of our cybersecurity risk management program.
At least annually, the CISO, CIO and certain other members of the cybersecurity committee report to the Board on the state of our cybersecurity risk program and current and emerging cybersecurity risks.
At least annually, the CISO, CIO and other members of the cybersecurity committee report to the Board on the state of our cybersecurity risk management program and current and emerging cybersecurity risks. The Board’s Audit Committee has been delegated strategic oversight of the cybersecurity committee and our cybersecurity risk management program, and is responsible for providing feedback, as needed.
With the goal of protecting against and managing cybersecurity threats, we have a cybersecurity risk management program designed to assess, identify, manage and mitigate cybersecurity threats that could adversely and materially affect our business.
To protect our data and systems against cybersecurity threats, our cybersecurity risk management program is designed to assess, identify, manage and mitigate cybersecurity threats that could adversely and materially affect our business. Our cybersecurity risk management program is aligned with our business strategy and integrated throughout our operations.
We are committed to protecting the confidentiality and integrity of, and access to, our information technology and other business systems, and the personal information of our employees and customers and business data managed, stored and processed on such systems.
We are committed to protecting the confidentiality and integrity of, and access to, our operational and information technology as well as the other systems used to conduct our business.
Our vulnerability management program is designed to identify, assess, and remediate cybersecurity threats in our systems, such as through penetration testing.
As part of our cybersecurity risk management program, we undertake ongoing cybersecurity risk assessments to help us detect, evaluate and respond to potential cybersecurity threats, including regular testing by our internal cyber operations team. Our vulnerability management program is designed to identify, assess, and remediate cybersecurity threats in our systems, such as through penetration testing.
This plan is designed to provide our executive officers and other members of our senior management team with the information needed to assess the materiality of a cybersecurity incident and the need for public disclosure. The incident response plan is tested annually to assess its operational effectiveness.
The IR plan provides our executive officers and other members of our senior management team with the information needed to assess whether a cybersecurity incident materially affected or is reasonably likely to materially affect our business strategy, results of operations, or financial condition, and the need for public disclosure.
The Board’s Audit Committee has been delegated strategic oversight of our cybersecurity risk management program and the work of the cybersecurity committee and is responsible for providing feedback regarding the cybersecurity risk program, as needed. Any cybersecurity incident deemed to have a moderate or higher business risk is also reported to the Board.
Any cybersecurity incident deemed to have a moderate or higher business risk also is reported to the Board.
We require all of our third-party information technology vendors to undergo evaluations by our internal data privacy and data security team as part of our efforts to assess, document and mitigate potential cybersecurity threats associated with our use of such vendors and the software, applications and services they provide.
Our internal data privacy and data security team evaluates vendors that have access (directly or indirectly) to our data and/or systems to help us document and mitigate potential cybersecurity threats associated with our use of those vendors and the products and services they provide.
Removed
We have sought to align our cybersecurity risk management program with our business strategy and integrate our cybersecurity risk management program into our overall risk management strategy and policies and throughout our operations.
Added
In addition, the breadth and complexity of the technologies we use continue to grow, including as a result of the use of mobile devices, cloud services, artificial intelligence, open-source software, social media and the increased reliance on devices connected to the internet.
Removed
As part of our cybersecurity risk management program, we undertake ongoing cyber risk assessments as part of our efforts to detect, evaluate and respond to potential cybersecurity threats, including regular testing by our internal cyber operations team. We also engage third-party cybersecurity consultants to provide cybersecurity audits, targeted attack testing, cybersecurity threat intelligence and cybersecurity incident response services.
Added
These evaluations also include how these vendors may incorporate generative artificial intelligence and other similar artificial intelligence tools into their offerings.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

8 edited+1 added−6 removed13 unchanged
Biggest changeIssuer Purchases of Equity Securities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Maximum Number (or ​ ​ ​ ​ ​ ​ Total Number of ​ Approximate Dollar ​ ​ ​ ​ ​ ​ Units Purchased as ​ Value) of Units That May ​ ​ Total Number ​ Average ​ Part of Publicly ​ Yet Be Purchased ​ ​ Of Units ​ Price Paid ​ Announced Plans or ​ Under the Plans or Period ​ Purchased ​ Per Unit($) ​ Programs (1) ​ Programs (1) October 1—October 31, 2023 — — — — ​ November 1—November 30, 2023 75,000 33.90 — 224,187 ​ December 1—December 31, 2023 8,000 37.78 — 216,187 ​ ​ (1) In May 2009, the board of directors of our general partner authorized the repurchase of our common units for the purpose of meeting our general partner’s anticipated obligations to deliver common units under the Long-Term Incentive Plan (“LTIP”) and meeting the general partner’s obligations under existing employment agreements and other employment related obligations of the general partner.
Biggest changeEquity Compensation Plan The equity compensation plan information required by Item 201(d) of Regulation S-K in response to this item is incorporated by reference from Part III, Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters—Equity Compensation Plan Table.” Recent Sales of Unregistered Securities None. 60 Table of Contents Issuer Purchases of Equity Securities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Maximum Number (or ​ ​ ​ ​ ​ ​ Total Number of ​ Approximate Dollar ​ ​ ​ ​ ​ ​ Units Purchased as ​ Value) of Units That May ​ ​ Total Number ​ Average ​ Part of Publicly ​ Yet Be Purchased ​ ​ Of Units ​ Price Paid ​ Announced Plans or ​ Under the Plans or Period ​ Purchased ​ Per Unit($) ​ Programs (1) ​ Programs (1) October 1 —October 31, 2024 — — — — ​ November 1—November 30, 2024 30,000 50.82 — 1,099,021 ​ December 1 —December 31, 2024 29,000 50.57 — 1,070,021 ​ ​ (1) In May 2009, the board of directors of our general partner authorized the repurchase of our common units for the purpose of meeting our general partner’s anticipated obligations to deliver common units under the Long-Term Incentive Plan (“LTIP”) and meeting the general partner’s obligations under existing employment agreements and other employment related obligations of the general partner.
Common units may be repurchased from time to time in open market transactions, including block purchases, or in privately negotiated transactions. Such authorized unit repurchases may be modified, suspended or terminated at any time, and are subject to price, economic and market conditions, applicable legal requirements and available liquidity. Item 6. [Reserved] ​ ​ 62 Table of Contents
Common units may be repurchased from time to time in open market transactions, including block purchases, or in privately negotiated transactions. Such authorized unit repurchases may be modified, suspended or terminated at any time, and are subject to price, economic and market conditions, applicable legal requirements and available liquidity. Item 6. [Reserved] ​ ​ 61 Table of Contents
Distributions on the Series A Preferred Units will be paid out of Available Cash with respect to the quarter immediately preceding the applicable Series A Distribution Payment Date.
Distributions on the Series A Preferred Units were paid out of available cash with respect to the quarter immediately preceding the applicable Series A Distribution Payment Date.
Distributions on the Series A Preferred Units are cumulative from August 7, 2018, the original issue date of the Series A Preferred Units, and payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each 60 Table of Contents year (each, a “Series A Distribution Payment Date”), commencing on November 15, 2018, to holders of record as of the opening of business on the February 1, May 1, August 1 or November 1 next preceding the Series A Distribution Payment Date, in each case, when, as, and if declared by the General Partner out of legally available funds for such purpose.
Prior to the April 15, 2024 redemption of the Series A Preferred Units, distributions on the Series A Preferred 59 Table of Contents Units were cumulative from August 7, 2018, the original issue date of the Series A Preferred Units, and were payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year (each, a “Series A Distribution Payment Date”), commencing on November 15, 2018, to holders of record as of the opening of business on the February 1, May 1, August 1 or November 1 next preceding the Series A Distribution Payment Date, in each case, when, as, and if declared by the general partner out of legally available funds for such purpose.
Market Information and Holders Our common units trade on the New York Stock Exchange (“NYSE”) under the symbol “GLP.” At the close of business on February 22, 2024, based upon information received from our transfer agent, we had 32 holders of record of our common units. The number of record holders does not include common units held in street name.
Market Information and Holders Our common units trade on the New York Stock Exchange (“NYSE”) under the symbol “GLP.” At the close of business on February 21, 2025, based upon information received from our transfer agent, we had 31 holders of record of our common units. The number of record holders does not include common units held in street name.
As of February 28, 2024, our general partner is authorized to acquire up to 216,187 of our common units in the aggregate over an extended period of time, consistent with the general partner’s obligations under the LTIP and employment agreements.
As of February 28, 2025, our general partner is authorized to acquire up to 1,070,021 of our common units in the aggregate over an extended period of time, consistent with the general partner’s obligations under the LTIP and employment agreements.
Since the repurchase program was implemented and through December 31, 2023, our general partner repurchased 1,221,240 common units pursuant to this repurchase program.
Since the repurchase program was implemented and through December 31, 2024, our general partner repurchased 1,530,566 common units pursuant to this repurchase program.
As holder of the incentive distribution rights, the general partner is entitled to incentive distributions if the amount we distribute with respect to any quarter exceeds specified target levels shown below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Marginal Percentage ​ ​ Total Quarterly Distribution ​ Interest in Distributions ​ ​ Target Amount ​ Unitholders ​ General Partner First Target Distribution up to $0.4625 99.33 % 0.67 % Second Target Distribution above $0.4625 up to $0.5375 86.33 % 13.67 % Third Target Distribution above $0.5375 up to $0.6625 76.33 % 23.67 % Thereafter above $0.6625 51.33 % 48.67 % Series A Preferred Units On August 7, 2018, we issued 2,760,000 Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units representing limited partner interests (the “Series A Preferred Units”) at a price of $25.00 per Series A Preferred Unit.
As holder of the incentive distribution rights, the general partner is entitled to incentive distributions if the amount we distribute with respect to any quarter exceeds specified target levels shown below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Marginal Percentage ​ ​ Total Quarterly Distribution ​ Interest in Distributions ​ ​ Target Amount ​ Unitholders ​ General Partner First Target Distribution up to $0.4625 99.33 % 0.67 % Second Target Distribution above $0.4625 up to $0.5375 86.33 % 13.67 % Third Target Distribution above $0.5375 up to $0.6625 76.33 % 23.67 % Thereafter above $0.6625 51.33 % 48.67 % Series A Preferred Units On April 15, 2024 we redeemed all 2,760,000 of our Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units (the “Series A Preferred Units”) at a redemption price of $25.00 per unit, plus a $0.514275 per unit cash distribution for the period from February 15, 2024 through April 14, 2024 .
Removed
No distribution may be declared or paid or set apart for payment on any junior securities (other than a distribution payable solely in junior securities) unless full cumulative distributions have been or contemporaneously are being paid or provided for on all outstanding Series A Preferred Units and any parity securities through the most recent respective distribution periods.
Added
Effective April 15, 2024, the Series A Preferred Units are no longer outstanding.
Removed
The initial distribution rate for the Series A Preferred Units from and including the original issue date, but excluding, August 15, 2023 was 9.75% per annum of the $25.00 liquidation preference per unit.
Removed
On and after August 15, 2023, distributions on the Series A Preferred Units accumulate for each distribution period at a percentage of the $25.00 liquidation preference equal to (i) an annual floating rate of a substitute or successor base rate that a calculation agent determines to be the most comparable to the three-month LIBOR plus (ii) a spread of 6.774% per annum.
Removed
For the successor base rate comparable to the three-month LIBOR, a calculation agent selected the industry-accepted substitute which is the 3-month CME Term SOFR plus the applicable tenor spread of 0.26161% per annum.
Removed
We may redeem, at our option and at any time, in whole or in part, the Series A Preferred Units at a redemption price in cash of $25.00 per Series A Preferred Unit plus an amount equal to all accumulated and unpaid distributions thereon to, but excluding, the date of redemption, whether or not declared.
Removed
We must provide not less than 30 days’ and not more than 60 days’ advance written notice of any such redemption. 61 Table of Contents Equity Compensation Plan The equity compensation plan information required by Item 201(d) of Regulation S-K in response to this item is incorporated by reference from Part III, Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters—Equity Compensation Plan Table.” Recent Sales of Unregistered Securities None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

121 edited+17 added−34 removed147 unchanged
Biggest change(7) Excludes 64 sites at December 31, 2023 that are operated by our SPR joint venture (see Note 17 of Notes to Consolidated Financial Statements). ​ ​ 74 Table of Contents ​ The following table presents reconciliations of EBITDA and adjusted EBITDA to the most directly comparable GAAP financial measures on a historical basis (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2023 2022 Reconciliation of net income to EBITDA and adjusted EBITDA: ​ ​ ​ ​ ​ ​ ​ Net income ​ $ 152,506 ​ $ 362,207 ​ Depreciation and amortization ​ 110,090 ​ 104,796 ​ Interest expense ​ 85,631 ​ 81,259 ​ Income tax expense ​ 8,136 ​ 16,822 ​ EBITDA ​ ​ 356,363 ​ ​ 565,084 ​ Net gain on sale and disposition of assets ​ ​ (2,626) ​ ​ (79,873) ​ Income from equity method investments (1) ​ ​ (2,503) ​ ​ — ​ EBITDA related to equity method investments (1) ​ ​ 5,030 ​ ​ — ​ Adjusted EBITDA ​ $ 356,264 ​ $ 485,211 ​ ​ ​ ​ ​ ​ ​ ​ ​ Reconciliation of net cash provided by operating activities to EBITDA and adjusted EBITDA: ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ​ $ 512,441 ​ $ 479,996 ​ Net changes in operating assets and liabilities and certain non-cash items ​ (249,845) ​ (12,993) ​ Interest expense ​ 85,631 ​ 81,259 ​ Income tax expense ​ 8,136 ​ 16,822 ​ EBITDA ​ ​ 356,363 ​ ​ 565,084 ​ Net gain on sale and disposition of assets ​ ​ (2,626) ​ ​ (79,873) ​ Income from equity method investments (1) ​ ​ (2,503) ​ ​ — ​ EBITDA related to equity method investments (1) ​ ​ 5,030 ​ ​ — ​ Adjusted EBITDA ​ $ 356,264 ​ $ 485,211 ​ (1) Represents our proportionate share of income and EBITDA, as applicable, related to our 49.99% interest in our SPR joint venture (see Note 17 of Notes to Consolidated Financial Statements). ​ ​ 75 Table of Contents The following table presents reconciliations of distributable cash flow and adjusted distributable cash flow to the most directly comparable GAAP financial measures on a historical basis (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2023 2022 Reconciliation of net income to distributable cash flow and adjusted distributable cash flow: ​ ​ ​ ​ ​ ​ ​ Net income ​ $ 152,506 ​ $ 362,207 ​ Depreciation and amortization ​ 110,090 ​ 104,796 ​ Amortization of deferred financing fees ​ 5,651 ​ 5,432 ​ Amortization of routine bank refinancing fees ​ (4,700) ​ (4,596) ​ Maintenance capital expenditures ​ (60,838) ​ (54,444) ​ Distributable cash flow (1)(2) ​ ​ 202,709 ​ ​ 413,395 ​ Income from equity method investments (3) ​ ​ (2,503) ​ ​ — ​ Distributable cash flow from equity method investments (3) ​ ​ 1,509 ​ ​ — ​ Adjusted distributable cash flow (1) ​ ​ 201,715 ​ ​ 413,395 ​ Distributions to preferred unitholders (4) ​ ​ (14,559) ​ ​ (13,852) ​ Adjusted distributable cash flow after distributions to preferred unitholders ​ $ 187,156 ​ $ 399,543 ​ ​ ​ ​ ​ ​ ​ ​ ​ Reconciliation of net cash provided by operating activities to distributable cash flow and adjusted distributable cash flow: ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ​ $ 512,441 ​ $ 479,996 ​ Net changes in operating assets and liabilities and certain non-cash items ​ (249,845) ​ (12,993) ​ Amortization of deferred financing fees ​ 5,651 ​ 5,432 ​ Amortization of routine bank refinancing fees ​ (4,700) ​ (4,596) ​ Maintenance capital expenditures ​ (60,838) ​ (54,444) ​ Distributable cash flow (1)(2) ​ ​ 202,709 ​ ​ 413,395 ​ Income from equity method investments (3) ​ ​ (2,503) ​ ​ — ​ Distributable cash flow from equity method investments (3) ​ ​ 1,509 ​ ​ — ​ Adjusted distributable cash flow (1) ​ ​ 201,715 ​ ​ 413,395 ​ Distributions to preferred unitholders (4) ​ ​ (14,559) ​ ​ (13,852) ​ Adjusted distributable cash flow after distributions to preferred unitholders ​ $ 187,156 ​ $ 399,543 ​ ​ (1) Distributable cash flow and adjusted distributable cash flow are non-GAAP financial measures which are discussed above under “—Evaluating Our Results of Operations.” As defined by our partnership agreement, distributable cash flow is not adjusted for certain non-cash items, such as net losses on the sale and disposition of assets and goodwill and long-lived asset impairment charges.
Biggest change(7) Excludes 64 sites at December 31, 2024 that are operated by our joint venture, SPR (see Note 17 of Notes to Consolidated Financial Statements). ​ The following table presents reconciliations of EBITDA and adjusted EBITDA to the most directly comparable GAAP financial measures on a historical basis (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2024 2023 Reconciliation of net income to EBITDA and adjusted EBITDA: ​ ​ ​ ​ ​ ​ ​ Net income ​ $ 110,327 ​ $ 152,506 ​ Depreciation and amortization ​ 139,685 ​ 110,090 ​ Interest expense ​ 134,773 ​ 85,631 ​ Income tax expense ​ 4,609 ​ 8,136 ​ EBITDA ​ ​ 389,394 ​ ​ 356,363 ​ Net gain on sale and disposition of assets ​ ​ (9,494) ​ ​ (2,626) ​ Long-lived asset impairment ​ ​ 492 ​ ​ — ​ Loss (income) from equity method investments (1) ​ ​ 1,514 ​ ​ (2,503) ​ EBITDA related to equity method investments (1) ​ ​ 6,987 ​ ​ 5,030 ​ Adjusted EBITDA ​ $ 388,893 ​ $ 356,264 ​ ​ ​ ​ ​ ​ ​ ​ ​ Reconciliation of net cash provided by operating activities to EBITDA and adjusted EBITDA: ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ​ $ 31,600 ​ $ 512,441 ​ Net changes in operating assets and liabilities and certain non-cash items ​ 218,412 ​ (249,845) ​ Interest expense ​ 134,773 ​ 85,631 ​ Income tax expense ​ 4,609 ​ 8,136 ​ EBITDA ​ ​ 389,394 ​ ​ 356,363 ​ Net gain on sale and disposition of assets ​ ​ (9,494) ​ ​ (2,626) ​ Long-lived asset impairment ​ ​ 492 ​ ​ — ​ Loss (income) from equity method investments (1) ​ ​ 1,514 ​ ​ (2,503) ​ EBITDA related to equity method investments (1) ​ ​ 6,987 ​ ​ 5,030 ​ Adjusted EBITDA ​ $ 388,893 ​ $ 356,264 ​ (1) Represents our proportionate share of (loss) income and EBITDA, as applicable, related to our interests in our equity method investments (see Note 17 of Notes to Consolidated Financial Statements). 72 Table of Contents ​ The following table presents reconciliations of distributable cash flow and adjusted distributable cash flow to the most directly comparable GAAP financial measures on a historical basis (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2024 2023 Reconciliation of net income to distributable cash flow and adjusted distributable cash flow: ​ ​ ​ ​ ​ ​ ​ Net income ​ $ 110,327 ​ $ 152,506 ​ Depreciation and amortization ​ 139,685 ​ 110,090 ​ Amortization of deferred financing fees ​ 7,449 ​ 5,651 ​ Amortization of routine bank refinancing fees ​ (4,774) ​ (4,700) ​ Maintenance capital expenditures ​ (46,889) ​ (60,838) ​ Distributable cash flow (1)(2) ​ ​ 205,798 ​ ​ 202,709 ​ Loss (income) from equity method investments (3) ​ ​ 1,514 ​ ​ (2,503) ​ Distributable cash flow from equity method investments (3) ​ ​ 661 ​ ​ 1,509 ​ Adjusted distributable cash flow (1) ​ ​ 207,973 ​ ​ 201,715 ​ Distributions to preferred unitholders (4) ​ ​ (9,575) ​ ​ (14,559) ​ Adjusted distributable cash flow after distributions to preferred unitholders ​ $ 198,398 ​ $ 187,156 ​ ​ ​ ​ ​ ​ ​ ​ ​ Reconciliation of net cash provided by operating activities to distributable cash flow and adjusted distributable cash flow: ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ​ $ 31,600 ​ $ 512,441 ​ Net changes in operating assets and liabilities and certain non-cash items ​ 218,412 ​ (249,845) ​ Amortization of deferred financing fees ​ 7,449 ​ 5,651 ​ Amortization of routine bank refinancing fees ​ (4,774) ​ (4,700) ​ Maintenance capital expenditures ​ (46,889) ​ (60,838) ​ Distributable cash flow (1)(2) ​ ​ 205,798 ​ ​ 202,709 ​ Loss (income) from equity method investments (3) ​ ​ 1,514 ​ ​ (2,503) ​ Distributable cash flow from equity method investments (3) ​ ​ 661 ​ ​ 1,509 ​ Adjusted distributable cash flow (1) ​ ​ 207,973 ​ ​ 201,715 ​ Distributions to preferred unitholders (4) ​ ​ (9,575) ​ ​ (14,559) ​ Adjusted distributable cash flow after distributions to preferred unitholders ​ $ 198,398 ​ $ 187,156 ​ ​ (1) Distributable cash flow and adjusted distributable cash flow are non-GAAP financial measures which are discussed above under “—Evaluating Our Results of Operations.” As defined by our partnership agreement, distributable cash flow is not adjusted for certain non-cash items, such as net losses on the sale and disposition of assets and goodwill and long-lived asset impairment charges.
We used the net proceeds from the offering to repay a portion of the borrowings outstanding under our credit agreement and for general corporate purposes.
We used the net proceeds from the offering to repay a portion of the borrowings outstanding under our credit agreement and for general corporate purposes.
The Issuers will have the option to redeem the 2032 Notes, in whole or in part, at any time on or after January 15, 2027, at the redemption prices of 104.125% for the twelve-month period beginning January 15, 2027, 102.063% for the twelve-month period beginning January 15, 2028, and 100% beginning on January 15, 2029 and at any time thereafter, together with any accrued and unpaid interest to the date of redemption.
The Issuers have the option to redeem the 2032 Notes, in whole or in part, at any time on or after January 15, 2027, at the redemption prices of 104.125% for the twelve-month period beginning January 15, 2027, 102.063% for the twelve-month period beginning January 15, 2028, and 100% beginning on January 15, 2029 and at any time thereafter, together with any accrued and unpaid interest to the date of redemption.
On February 5, 2024, we and the lenders under our credit agreement agreed, pursuant to the terms of our credit agreement, to (i) a reallocation of $300.0 million of the revolving credit facility to the working capital revolving credit facility and (ii) reduce the accordion feature from $200.0 million to $0.
Credit Agreement Facility Reallocation and Accordion Reduction —On February 5, 2024, we and the lenders under our credit agreement agreed, pursuant to the terms of our credit agreement, to (i) a reallocation of $300.0 million of the revolving credit facility to the working capital revolving credit facility and (ii) reduce the accordion feature from $200.0 million to $0.
EBITDA and Adjusted EBITDA EBITDA and adjusted EBITDA are non-GAAP financial measures used as supplemental financial measures by management and may be used by external users of our consolidated financial statements, such as investors, commercial banks and research analysts, to assess: ● our compliance with certain financial covenants included in our debt agreements; ● our financial performance without regard to financing methods, capital structure, income taxes or historical cost basis; ● our ability to generate cash sufficient to pay interest on our indebtedness and to make distributions to our partners; ● our operating performance and return on invested capital as compared to those of other companies in the wholesale, marketing, storing and distribution of refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, and in the gasoline stations and convenience stores business, without regard to financing methods and capital structure; and 70 Table of Contents ● the viability of acquisitions and capital expenditure projects and the overall rates of return of alternative investment opportunities.
EBITDA and Adjusted EBITDA EBITDA and adjusted EBITDA are non-GAAP financial measures used as supplemental financial measures by management and may be used by external users of our consolidated financial statements, such as investors, commercial banks and research analysts, to assess: ● our compliance with certain financial covenants included in our debt agreements; ● our financial performance without regard to financing methods, capital structure, income taxes or historical cost basis; ● our ability to generate cash sufficient to pay interest on our indebtedness and to make distributions to our partners; ● our operating performance and return on invested capital as compared to those of other companies in the wholesale, marketing, storing and distribution of refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, and in the gasoline stations and convenience stores business, without regard to financing methods and capital structure; and ● the viability of acquisitions and capital expenditure projects and the overall rates of return of alternative investment opportunities.
Net cash used in financing activities was offset by $281.0 million in net borrowings on our revolving credit facility, in part due to fund the acquisition of the Terminal Facilities from Motiva.
Net cash used in financing activities was offset by $281.0 million in net borrowings on our revolving credit facility, in part due to fund the acquisition of the Motiva Terminal Facilities.
Events of default under the 2032 Notes Indenture include (i) a default in payment of principal of, or interest or premium, if any, on, the 2032 Notes, (ii) breach of our covenants under the 2032 Notes Indenture, (iii) certain events of bankruptcy and insolvency, (iv) any payment default or acceleration of indebtedness of our or certain subsidiaries if the total amount of such indebtedness unpaid or accelerated exceeds $50.0 million and (v) failure to pay within 60 days uninsured final judgments exceeding $50.0 million. 6.875% Senior Notes Due 2029 On October 7, 2020, the Issuers issued $350.0 million aggregate principal amount of 6.875% senior notes due 2029 (the “2029 Notes”) to several initial purchasers in a private placement exempt from the registration requirements under the Securities Act.
Events of default under the 2032 Notes Indenture include (i) a default in payment of principal of, or interest or premium, if any, 81 Table of Contents on, the 2032 Notes, (ii) breach of our covenants under the 2032 Notes Indenture, (iii) certain events of bankruptcy and insolvency, (iv) any payment default or acceleration of indebtedness of our or certain subsidiaries if the total amount of such indebtedness unpaid or accelerated exceeds $50.0 million and (v) failure to pay within 60 days uninsured final judgments exceeding $50.0 million. 6.875% Senior Notes Due 2029 On October 7, 2020, the Issuers issued $350.0 million aggregate principal amount of 6.875% senior notes due 2029 (the “2029 Notes”) to several initial purchasers in a private placement exempt from the registration requirements under the Securities Act.
For purposes of evaluating our results of operations, we use the normal heating degree day amount as reported by the National Weather Service at its Logan International Airport station in Boston, Massachusetts . 72 Table of Contents Key Performance Indicators The following table provides a summary of some of the key performance indicators that may be used to assess our results of operations.
For purposes of evaluating our results of operations, we use the normal heating degree day amount as reported by the National Weather Service at its Logan International Airport station in Boston, Massachusetts . 70 Table of Contents Key Performance Indicators The following table provides a summary of some of the key performance indicators that may be used to assess our results of operations.
When prices for 66 Table of Contents the products we sell decline, our exposure to risk of loss in the event of nonperformance by our customers of our forward contracts may be increased as they and/or their customers may breach their contracts and purchase the products we sell at the then lower market price from a competitor. ● We commit substantial resources to pursuing acquisitions and expending capital for growth projects, although there is no certainty that we will successfully complete any acquisitions or growth projects or receive the economic results we anticipate from completed acquisitions or growth projects.
When prices for the products we sell decline, our exposure to risk of loss in the event of nonperformance by our customers of our forward contracts may be increased as they and/or their customers may breach their contracts and purchase the products we sell at the then lower market price from a competitor. ● We commit substantial resources to pursuing acquisitions and expending capital for growth projects, although there is no certainty that we will successfully complete any acquisitions or growth projects or receive the economic results we anticipate from completed acquisitions or growth projects.
The credit agreement also includes certain baskets, including (i) a $25.0 million general secured indebtedness basket, (ii) a $25.0 million general investment basket, (iii) a $75.0 million secured indebtedness basket to permit the borrowers to enter into a Contango Facility (as defined in the credit agreement), (iv) a Sale/Leaseback Transaction (as defined in the credit agreement) basket of $100.0 million, and (v) a basket of $150.0 million in an aggregate amount for the purchase of our common units, provided that, among other things, no Default exists or would occur immediately following such purchase(s).
The credit agreement also includes certain baskets, including (i) a $25.0 million general secured indebtedness 80 Table of Contents basket, (ii) a $25.0 million general investment basket, (iii) a $75.0 million secured indebtedness basket to permit the borrowers to enter into a Contango Facility (as defined in the credit agreement), (iv) a Sale/Leaseback Transaction (as defined in the credit agreement) basket of $100.0 million, and (v) a basket of $150.0 million in an aggregate amount for the purchase of our common units, provided that, among other things, no Default exists or would occur immediately following such purchase(s).
Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 that are not included in this Form 10-K can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023.
See Note 17 of Notes to Consolidated Financial Statements. Except as otherwise specifically indicated, the information and discussion and analysis in this section does not otherwise take into account the financial condition and results of operations of SPR. Overview We are a master limited partnership formed in March 2005.
See Note 17 of Notes to Consolidated Financial Statements. Except as otherwise specifically indicated, the information and discussion and analysis in this section does not otherwise take into account the financial condition and results of operations of SPR or Everett. Overview We are a master limited partnership formed in March 2005.
Goodwill is tested for impairment annually as of October 1 or when events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. All of our goodwill is allocated to the GDSO segment. During 2023 and 2022, we completed a quantitative assessment for the GDSO reporting unit.
Goodwill is tested for impairment annually as of October 1 or when events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable. All of our goodwill is allocated to the GDSO segment. During 2024 and 2023, we completed a quantitative assessment for the GDSO reporting unit.
In addition, we had other revenues of approximately $0.6 billion for the year ended December 31, 2023 from convenience store and prepared food sales at our directly operated stores, rental income from dealer leased and commissioned agent leased gasoline stations and from cobranding arrangements, and sundries.
In addition, we had other revenues of approximately $0.6 billion for the year ended December 31, 2024 from convenience store and prepared food sales at our directly operated stores, rental income from dealer leased and commissioned agent leased gasoline stations and from cobranding arrangements, and sundries.
The respective income tax expense predominantly reflects the income tax expense from the operating results of GMG, which is a taxable entity for federal and state income tax purposes. 78 Table of Contents Liquidity and Capital Resources Liquidity Our primary liquidity needs are to fund our working capital requirements, capital expenditures and distributions and to service our indebtedness.
The respective income tax expense predominantly reflects the income tax expense from the operating results of GMG, which is a taxable entity for federal and state income tax purposes. 75 Table of Contents Liquidity and Capital Resources Liquidity Our primary liquidity needs are to fund our working capital requirements, capital expenditures and distributions and to service our indebtedness.
The credit agreement imposes financial covenants that require us to maintain certain minimum working capital amounts, a minimum combined interest coverage ratio, a maximum senior secured leverage ratio and a maximum total leverage ratio. We were in compliance with the foregoing covenants at December 31, 2023.
The credit agreement imposes financial covenants that require us to maintain certain minimum working capital amounts, a minimum combined interest coverage ratio, a maximum senior secured leverage ratio and a maximum total leverage ratio. We were in compliance with the foregoing covenants at December 31, 2024.
We own, control or have access to a large terminal network of refined petroleum products and renewable fuels—with strategic rail and/or marine assets—spanning from Maine to Florida and into the U.S. Gulf states.
We own, control or have access to a large terminal network of refined petroleum products and renewable fuels—with connectivity to strategic rail, pipeline and marine assets—spanning from Maine to Florida and into the U.S. Gulf States.
Increased conservation and technological advances have adversely affected the demand for home heating oil and residual oil. Consumption of residual oil has steadily declined over the last several decades. We could face additional competition from alternative energy sources as a result of future government-mandated controls or regulations further promoting the use of cleaner fuels.
Increased conservation and technological advances have adversely affected the demand for home heating oil and residual oil. Consumption of residual oil has steadily declined over the last several decades. We could face additional competition from alternative energy sources as a result of future government-mandated controls or regulations further promoting the use of cleaner fuels or changing consumer preferences.
Lease payments, maintenance and repair, property taxes, utilities, credit card fees, taxes, labor and labor-related expenses comprise the most significant portion of our operating expenses. While the majority of these expenses remains relatively stable, independent of the volumes through our system, they can 71 Table of Contents fluctuate depending on the activities performed during a specific period.
Lease payments, maintenance and repair, property taxes, utilities, credit card fees, taxes, labor and labor-related expenses comprise the most significant portion of our operating expenses. While the majority of these expenses remains relatively stable, independent of the volumes through our system, they can fluctuate depending on the activities performed during a specific period.
The Issuers have the option to redeem the 2029 Notes, in whole or in part, at any time on or after January 15, 2024, at the redemption prices of 103.438% for the twelve-month period beginning on January 15, 2024, 102.292% for the twelve-month period beginning January 15, 2025, 101.146% for the twelve-month period beginning January 15, 2026, and 100% beginning on January 15, 2027 and at any time thereafter, together with any accrued and unpaid interest to the date of redemption.
The Issuers have the option to redeem the 2029 Notes, in whole or in part, at any time on or after January 15, 2025, at the redemption prices of 102.292% for the twelve-month period beginning on January 15, 2025, 101.146% for the twelve-month period beginning January 15, 2026, and 100% beginning on January 15, 2027 and at any time thereafter, together with any accrued and unpaid interest to the date of redemption.
Product sales primarily include sales of unbranded and branded gasoline, distillates, residual oil, renewable fuels and crude oil, as well as convenience store and prepared food sales, gasoline station rental income and revenue generated from our logistics activities when we engage in the storage, transloading and shipment of products owned by others.
Product sales primarily include sales of unbranded and branded gasoline, distillates, residual oil, renewable fuels and crude oil, as well as convenience store and prepared food sales, gasoline station rental income and revenue generated from our logistics activities when we engage in the storage, transloading and shipment of products 68 Table of Contents owned by others.
The Issuers have the option to redeem the 2027 Notes, in whole or in part, at any time on or after August 1, 2023, at the redemption prices of 102.333% for the twelve-month period beginning August 1, 2023, 101.167% for the twelve-month period beginning August 1, 2024, and 100% beginning on August 1, 2025 and at any time thereafter, together with any accrued and unpaid interest to the date of redemption.
The Issuers have the option to redeem the 2027 Notes, in whole or in part, at any time on or after August 1, 2024, at the redemption prices of 101.167% for the twelve-month period beginning August 1, 2024, and 100% beginning on August 1, 2025 and at any time thereafter, together with any accrued and unpaid interest to the date of redemption.
If the subsequent actual results and updated projections of the underlying business activity change compared with the assumptions and projections used to develop these values, we could experience impairment charges. In addition, we have estimated the economic lives of certain acquired assets and these lives are used to calculate depreciation and amortization expense.
If the subsequent actual results and updated projections of the 84 Table of Contents underlying business activity change compared with the assumptions and projections used to develop these values, we could experience impairment charges. In addition, we have estimated the economic lives of certain acquired assets and these lives are used to calculate depreciation and amortization expense.
Financing Activities Net cash used in financing activities was $4.4 million for 2023 and included $144.7 million in cash distributions to our limited partners (preferred and common unitholders) and our general partner, $136.6 million in net payments on our working capital revolving credit facility, $3.5 million in the repurchase of common units pursuant to our repurchase program for future satisfaction of our LTIP obligations, $0.5 million in LTIP units withheld for tax obligations and $0.1 million in distribution equivalent rights.
Net cash used in financing activities was $4.4 million for 2023 and included $144.7 million in cash distributions to our limited partners (preferred and common unitholders) and our general partner, $136.6 million in net payments on our working capital revolving credit facility, $3.5 million in the repurchase of common units pursuant to our repurchase program for future satisfaction of our LTIP obligations, $0.5 million in LTIP units withheld for tax obligations and $0.1 million paid pursuant to distribution equivalent rights previously granted under our LTIP.
In addition, changes in blending requirements or broadening the definition of what constitutes a renewable fuel could affect the price of RINs which could impact the magnitude of the mark-to-market liability recorded for the deficiency, if any, in our RIN position relative to our RVO at a point in time.
In addition, changes in blending requirements or broadening the definition of what constitutes a renewable fuel could affect the price of RINs which could impact the magnitude of the mark-to-market liability recorded for the deficiency, if any, in our RIN position relative to 67 Table of Contents our RVO at a point in time.
As a result of such challenges, the anticipated benefits associated with our joint ventures may not be achieved and could negatively impact our results of operations. ● The condition of credit markets may adversely affect our liquidity. In the past, world financial markets experienced a severe reduction in the availability of credit.
As a result of such challenges, the anticipated benefits associated with our joint ventures may not be achieved and could negatively impact our results of operations. 65 Table of Contents ● The condition of credit markets may adversely affect our liquidity. In the past, world financial markets experienced a severe reduction in the availability of credit.
We may not be able to renew the permits necessary for our 69 Table of Contents operations, or we may be forced to accept terms in future permits that limit our operations or result in additional compliance costs. Results of Operations Evaluating Our Results of Operations Our management uses a variety of financial and operational measurements to analyze our performance.
We may not be able to renew the permits necessary for our operations, or we may be forced to accept terms in future permits that limit our operations or result in additional compliance costs. Results of Operations Evaluating Our Results of Operations Our management uses a variety of financial and operational measurements to analyze our performance.
Interest will be payable beginning July 15, 2024 and thereafter semi-annually in arrears on January 15 and July 15 of each year. The 2032 Notes are guaranteed on a joint and several senior unsecured basis by each of the Issuers and the subsidiary guarantors to the extent set forth in the 2032 Notes Indenture.
Interest is payable beginning July 15, 2024 and thereafter semi-annually in arrears on January 15 and July 15 of each year. The 2032 Notes are guaranteed on a joint and several senior unsecured basis by each of the Issuers and the subsidiary guarantors to the extent set forth in the 2032 Notes Indenture.
Environmental and Other Liabilities We record accrued liabilities for all direct costs associated with the estimated resolution of contingencies at the earliest date at which it is deemed probable that a liability has been incurred and the amount of such liability can be 88 Table of Contents reasonably estimated.
Environmental and Other Liabilities We record accrued liabilities for all direct costs associated with the estimated resolution of contingencies at the earliest date at which it is deemed probable that a liability has been incurred and the amount of such liability can be reasonably estimated.
This reallocation and accordion reduction return our credit facilities to the terms in place prior to the reallocation and accordion exercise previously agreed to by us and the lenders on December 7, 2023.
This reallocation and accordion reduction returned our credit facilities to the terms in place prior to the reallocation and accordion exercise previously agreed to by us and the lenders on December 7, 2023.
A number of new legal incentives and regulatory requirements, and executive initiatives, including various government subsidies including the extension of certain tax credits for renewable energy, have made these alternative forms of energy more competitive.
A number of new legal incentives and regulatory requirements, and executive 66 Table of Contents initiatives, including various government subsidies including the extension of certain tax credits for renewable energy, have made these alternative forms of energy more competitive.
The 2029 Notes Indenture contains covenants that limit our ability to, among other things, incur additional indebtedness and issue preferred securities, make certain dividends and distributions, make certain investments and other 85 Table of Contents restricted payments, restrict distributions by our subsidiaries, create liens, sell assets or merge with other entities.
The 2029 Notes Indenture contains covenants that limit our ability to, among other things, incur additional indebtedness and issue preferred securities, make certain dividends and distributions, make certain investments and other restricted payments, restrict distributions by our subsidiaries, create liens, sell assets or merge with other entities.
Recent Accounting Pronouncements A description and related impact expected from the adoption of certain new accounting pronouncements is provided in Note 2 of Notes to Consolidated Financial Statements included elsewhere in this report.
Recent Accounting Pronouncements A description and related impact expected from the adoption of certain new accounting pronouncements is provided in Note 2 of Notes to Consolidated Financial Statements included elsewhere in this report. 85 Table of Contents
Please read “—Capital Expenditures” for a discussion of our capital expenditures for the years ended December 31, 2023 and 2022.
Please read “—Capital Expenditures” for a discussion of our capital expenditures for the years ended December 31, 2024 and 2023.
During the terms of these leases, which expire in May 2028 and September 2029, in lieu of recognizing lease expense for the lease rental payments, we incur interest expense associated with the financing obligation. Interest expense of approximately $8.8 million and $9.0 million was recorded for the years ended December 31, 2023 and 2022, respectively.
During the terms of these leases, which expire in May 2028 and September 2029, in lieu of recognizing lease expense for the lease rental payments, we incur interest expense associated with the financing obligation. Interest expense of approximately $8.6 million and $8.8 million was recorded for the years ended December 31, 2024 and 2023, respectively.
Adjusted EBITDA is EBITDA further adjusted for gains or losses on the sale and disposition of assets, goodwill and long-lived asset impairment charges and our proportionate share of EBITDA related to our SPR joint venture, which is accounted for using the equity method.
Adjusted EBITDA is EBITDA further adjusted for gains or losses on the sale and disposition of assets, goodwill and long-lived asset impairment charges and our proportionate share of EBITDA related to our joint ventures accounted for using the equity method.
The average interest rates for the credit agreement were 7.2% and 3.7% for the years ended December 31, 2023 83 Table of Contents and 2022, respectively. The credit agreement provides for a letter of credit fee equal to the then applicable working capital rate or then applicable revolver rate per annum for each letter of credit issued.
The average interest rates for the credit agreement were 7.4%, 7.2% and 3.7% for the years ended December 31, 2024, 2023 and 2022, respectively. The credit agreement provides for a letter of credit fee equal to the then applicable working capital rate or then applicable revolver rate per annum for each letter of credit issued.
There were no Level 3 physical forward derivative contracts as of December 31, 2023 and 2022. 87 Table of Contents Accounting for the fair value measurement of physical forward derivative instruments is complex given the judgmental nature of the assumptions used as inputs into the valuation models.
There were no Level 3 physical forward derivative contracts as of December 31, 2024 and 2023. Accounting for the fair value measurement of physical forward derivative instruments is complex given the judgmental nature of the assumptions used as inputs into the valuation models.
Sales from wholesale gasoline and gasoline blendstocks were $5.9 billion and $6.4 billion for 2023 and 2022, respectively, a decrease of $0.5 billion, or 8%, primarily due to a decrease in prices, partially offset by an increase in volume sold.
Sales from wholesale gasoline and gasoline blendstocks were $6.5 billion and $5.9 billion for 2024 and 2023, respectively, an increase of $0.6 billion, or 10%, primarily due to an increase in volume sold, partially offset by a decrease in prices.
Adjusted distributable cash flow is distributable cash flow (as defined in our partnership agreement) further adjusted for our proportionate share of distributable cash flow related to our SPR joint venture, which is accounted for using the equity method.
Adjusted distributable cash flow is distributable cash flow (as defined in our partnership agreement) further adjusted for our proportionate share of distributable cash flow related to our joint ventures accounted for using the equity method.
As of December 31, 2023, there were two facilities under the credit agreement: ● a working capital revolving credit facility to be used for working capital purposes and letters of credit in the principal amount equal to the lesser of the Partnership’s borrowing base and $850 million; and ● a $900.0 million revolving credit facility to be used for general corporate purposes.
As of December 31, 2024, there were two facilities under the credit agreement: ● a working capital revolving credit facility to be used for working capital purposes and letters of credit in the principal amount equal to the lesser of the Partnership’s borrowing base and $950 million; and ● a $600.0 million revolving credit facility to be used for general corporate purposes.
On February 15, 2024, we paid the total cash distribution of approximately $1.8 million. Contractual Obligations We have contractual obligations that are required to be settled in cash.
On February 18, 2025, we paid the total cash distribution of approximately $1.8 million. Contractual Obligations We have contractual obligations that are required to be settled in cash.
The EPA has implemented a 68 Table of Contents RFS pursuant to the Energy Policy Act of 2005 and the Energy Independence and Security Act of 2007.
The EPA has implemented a RFS pursuant to the Energy Policy Act of 2005 and the Energy Independence and Security Act of 2007.
This section generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
This section generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
We currently expect maintenance capital expenditures of approximately $50.0 million to $60.0 million and expansion capital expenditures, excluding acquisitions, of approximately $60.0 million to $70.0 million in 2024, relating primarily to investments in our gasoline station and terminal businesses.
We currently expect maintenance capital expenditures of approximately $60.0 million to $70.0 million and expansion capital expenditures, excluding acquisitions, of approximately $75.0 million to $85.0 million in 2025, relating primarily to investments in our gasoline station and terminal businesses.
We may consummate transactions that we believe will be accretive but that ultimately may not be accretive. ● We may not be able to realize expected returns or other anticipated benefits associated with our joint ventures. We are currently involved in two joint ventures.
We may consummate transactions that we believe will be accretive but that ultimately may not be accretive. ● We may not be able to realize expected returns or other anticipated benefits associated with our joint ventures. We are currently involved in two joint ventures accounted for using the equity method.
In addition, we had outstanding letters of credit of $220.2 million. Subject to borrowing base limitations, the total remaining availability for borrowings and letters of credit was $1.13 billion and $1.12 billion at December 31, 2023 and 2022, respectively.
In addition, we had outstanding letters of credit of $100.2 million. Subject to borrowing base limitations, the total remaining availability for borrowings and letters of credit was $1.05 billion and $1.13 billion at December 31, 2024 and 2023, respectively.
These contracts are considered Level 2 derivative instruments under the fair value hierarchy as inputs used to determine fair value are not quoted prices in active markets. As of December 31, 2023, derivative assets of $17.7 million and derivative liabilities of $5.0 million were recorded for physical forward derivative contracts based on Level 2 fair value measurements.
These contracts are considered Level 2 derivative instruments under the fair value hierarchy as inputs used to determine fair value are not quoted prices in active markets. As of December 31, 2024, derivative assets of $13.7 million and derivative liabilities of $6.1 million were recorded for physical forward derivative contracts based on Level 2 fair value measurements.
Distributable cash flow as used in our partnership agreement also determines our ability to make cash distributions on our incentive distribution rights.
Distributable cash flow as used in our partnership agreement also determines our ability to make cash 69 Table of Contents distributions on our incentive distribution rights.
Cash Flow The following table summarizes cash flow activity for the years ended December 31 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2023 2022 Net cash provided by operating activities ​ $ 512,441 ​ $ 479,996 ​ Net cash used in investing activities ​ $ (492,380) ​ $ (236,193) ​ Net cash used in financing activities ​ $ (4,459) ​ $ (250,612) ​ Operating Activities Cash flow from operating activities generally reflects our net income, balance sheet changes arising from inventory purchasing patterns, the timing of collections on our accounts receivable, the seasonality of parts of our businesses, fluctuations in product prices, working capital requirements and general market conditions.
Cash Flow The following table summarizes cash flow activity for the years ended December 31 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Net cash provided by operating activities ​ $ 31,600 ​ $ 512,441 ​ Net cash used in investing activities ​ $ (276,871) ​ $ (492,380) ​ Net cash provided by (used in) financing activities ​ $ 233,837 ​ $ (4,459) ​ Operating Activities Cash flow from operating activities generally reflects our net income, balance sheet changes arising from inventory purchasing patterns, the timing of collections on our accounts receivable, the seasonality of parts of our businesses, fluctuations in product prices, working capital requirements and general market conditions.
We had approximately $28.0 million and $52.4 million in expansion capital expenditures, excluding acquired property and equipment, for the years ended December 31, 2023 and 2022, respectively, primarily related to investments in our gasoline station business.
We had approximately $56.4 million and $28.0 million in expansion capital expenditures, excluding acquired property and equipment, for the years ended December 31, 2024 and 2023, respectively, primarily related to investments in our gasoline station and terminal businesses.
In addition, we incur a commitment fee on the unused portion of each facility under the credit agreement, ranging from 0.35% to 0.50% per annum. As of December 31, 2023, we had $16.8 million outstanding on the working capital revolving credit facility and $380.0 million outstanding on the revolving credit facility.
In addition, we incur a commitment fee on the unused portion of each facility under the credit agreement, ranging from 0.35% to 0.50% per annum. As of December 31, 2024, we had $229.5 million outstanding on the working capital revolving credit facility and $167.0 million outstanding on the revolving credit facility.
Certain costs associated with our contractual obligations for certain transportation assets are fixed and do not vary with volumes transported. Should we experience a reduction in our logistics activities, costs associated with our contractual obligations for related transportation assets may not decrease ratably or at 67 Table of Contents all.
Certain costs associated with our contractual obligations for certain transportation assets, such as barges and railcars, are fixed and do not vary with volumes transported. Should we experience a reduction in our logistics activities, costs associated with our contractual obligations for related transportation assets may not decrease ratably or at all.
We had approximately $60.8 million and $54.4 million in maintenance capital expenditures for the years ended December 31, 2023 and 2022, respectively, which are included in capital expenditures in the accompanying consolidated statements of cash flows, of which approximately $52.9 million and $45.0 million for 2023 and 2022, respectively, are related to our investments in our gasoline station business.
We had approximately $46.9 million and $60.8 million in maintenance capital expenditures for the years ended December 31, 2024 and 2023, respectively, which are included in capital expenditures in the accompanying consolidated statements of cash flows, of which approximately $36.7 million and $52.9 million for 2024 and 2023, respectively, are related to our investments in our gasoline station business.
In 2022, the increases in accounts receivable inventories and accounts payable are in part due to the increase in prices. 81 Table of Contents Investing Activities Net cash used in investing activities was $492.4 million for 2023 and included $313.2 million related to the acquisition of the Terminal Facilities from Motiva (see Note 3 to Notes to Consolidated Financial Statements), $95.3 million in expenditures associated with our equity method investments (see Note 17 of Notes to Consolidated Financial Statements), $88.8 million in capital expenditures, $8.5 million in seller note issuances which represent notes we received from buyers in connection with the sale of certain of our gasoline stations and $1.5 million in an immaterial acquisition.
Net cash used in investing activities was $492.4 million for 2023 and included $313.2 million related to the acquisition of the Motiva Terminal Facilities (see Note 3 to Notes to Consolidated Financial Statements), $95.3 million in expenditures associated with our equity method investments, $88.8 million in capital expenditures, $8.5 million in seller note issuances which represent notes we received from buyers in connection with the sale of certain of our gasoline stations and $1.5 million in an immaterial acquisition.
Sales from distillates and other oils (primarily residual oil and crude oil) were $3.7 billion and $4.5 billion for 2023 and 2022, respectively, a decrease of $0.8 billion, or 17%, primarily due to a decrease in distillate prices, partially offset by an increase in volume sold.
Sales from distillates and other oils (primarily residual oil and crude oil) were $4.2 billion and $3.7 billion for 2024 and 2023, respectively, an increase of $0.5 billion, or 13%, primarily due to an increase in distillate volume sold, partially offset by decreases in residual oil volume sold and in distillates prices.
Sales from gasoline distribution were $5.3 billion and $6.1 billion for 2023 and 2022, respectively, a decrease of $0.8 billion, or 13%, primarily due to decreases in prices and in volume sold.
Sales from gasoline distribution were $4.8 billion and $5.3 billion for 2024 and 2023, respectively, a decrease of $0.5 billion, or 9%, primarily due to decreases in prices and in volume sold.
Collectively, we sold approximately $15.9 billion of refined petroleum products, gasoline blendstocks, renewable fuels and crude oil for the year ended December 31, 2023.
Collectively, we sold approximately $16.6 billion of refined petroleum products, gasoline blendstocks, renewable fuels and crude oil for the year ended December 31, 2024.
As of December 31, 2023, we had a portfolio of 1,627 owned, leased and/or supplied gasoline stations, including 341 directly operated convenience stores, primarily in the Northeast, as well as 64 gasoline stations located in Texas that are operated by our unconsolidated affiliate, SPR.
As of December 31, 2024, we had a portfolio of 1,584 owned, leased and/or supplied gasoline stations, including 300 directly operated convenience stores, primarily in the Northeast, as well as 64 gasoline stations located in Texas that are operated by our joint venture, SPR.
Our primary sources of liquidity are cash generated from operations, amounts available under our working capital revolving credit facility and equity and debt offerings. Please read “—Credit Agreement” for more information on our working capital revolving credit facility. Working capital was $115.0 million and $197.8 million at December 31, 2023 and 2022, respectively, a decrease of $82.8 million.
Our primary sources of liquidity are cash generated from operations, amounts available under our working capital revolving credit facility and equity and debt offerings. Please read “—Credit Agreement” for more information on our working capital revolving credit facility. Working capital was $207.2 million and $115.0 million at December 31, 2024 and 2023, respectively, an increase of $92.2 million.
Preferred Units During 2023, we paid the following cash distributions to holders of the Series A Preferred Units and the Series B Preferred Units: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Distribution ​ Series A Preferred Units ​ Series B Preferred Units ​ Distribution Paid for the ​ Payment Date ​ Total Paid ​ Rate ​ Total Paid ​ Rate ​ Quarterly Period Covering ​ 2/15/2023 ​ $ 1.7 million ​ 9.75% ​ $ 1.8 million ​ 9.50% 11/15/22 - 2/14/23 ​ 5/15/2023 ​ $ 1.7 million ​ 9.75% ​ $ 1.8 million ​ 9.50% 2/15/23 - 5/14/23 ​ 8/15/2023 ​ $ 1.7 million ​ 9.75% ​ $ 1.8 million ​ 9.50% 5/15/23 - 8/14/23 ​ 11/15/2023 ​ $ 2.1 million ​ 12.40% ​ $ 1.8 million ​ 9.50% 8/15/23 - 11/14/23 ​ In addition, on January 16, 2024, the board of directors of our general partner declared a quarterly cash distribution of $0.77596 per unit ($3.10 per unit on an annualized basis) on the Series A Preferred Units for the period from November 15, 2023 through February 14, 2024 to our Series A preferred unitholders of record as of the opening of business on February 1, 2024.
During 2024, we paid the following cash distributions to holders of the Series B Preferred Units: ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Distribution ​ Series B Preferred Units ​ Distribution Paid for the ​ Payment Date ​ Total Paid ​ Rate ​ Quarterly Period Covering ​ February 15, 2024 ​ $ 1.8 million ​ 9.50% 11/15/23 - 2/14/24 ​ May 15, 2024 ​ $ 1.8 million ​ 9.50% 2/15/24 - 5/14/24 ​ August 15, 2024 ​ $ 1.8 million ​ 9.50% 5/15/24 - 8/14/24 ​ November 15, 2024 ​ $ 1.8 million ​ 9.50% 8/15/24 - 11/14/24 ​ 76 Table of Contents In addition, on January 13, 2025, the board of directors of our general partner declared a quarterly cash distribution of $0.59375 per unit ($2.375 per unit on an annualized basis) on the Series B Preferred Units for the period from November 15, 2024 through February 14, 2025 to our Series B preferred unitholders of record as of the opening of business on February 3, 2025.
Repair and maintenance expenses associated with existing assets that are minor in nature and do not extend the useful life of existing assets are charged to operating expenses as incurred. 80 Table of Contents Expansion capital expenditures include expenditures to acquire assets to grow our businesses or expand our existing facilities, such as projects that increase our operating capacity or revenues by, for example, increasing dock capacity and tankage, diversifying product availability, investing in raze and rebuilds and new-to-industry gasoline stations and convenience stores, increasing storage flexibility at various terminals and by adding terminals to our storage network.
Expansion capital expenditures include expenditures to acquire assets to grow our businesses or expand our existing facilities, such as projects that increase our operating capacity or revenues by, for example, increasing dock 77 Table of Contents capacity and tankage, diversifying product availability, investing in raze and rebuilds and new-to-industry gasoline stations and convenience stores, increasing storage flexibility at various terminals and by adding terminals to our storage network.
The financing obligation will amortize through expiration of the leases based upon the lease rental 86 Table of Contents payments which were $10.9 million and $10.6 million for the years ended December 31, 2023 and 2022, respectively. The financing obligation balance outstanding at December 31, 2023 was $81.3 million associated with the acquisition.
The financing obligation will amortize through expiration of the leases based upon the lease rental payments which were $11.1 million and $10.9 million for the years ended December 31, 2024 and 2023, respectively. The financing obligation balance outstanding at December 31, 2024 was $78.8 million associated with the acquisition.
The decrease in working capital was offset by a decrease of $136.6 million in the current portion of our working capital revolving credit facility and an increase of $72.9 million in accounts receivable.
The increase in working capital was offset by an increase of $112.7 million in the current portion of our working capital revolving credit facility and a decrease of $79.2 million in accounts receivable.
We try to anticipate future regulatory requirements that might be imposed and plan accordingly to remain in compliance with changing environmental laws and regulations and to minimize the costs of such compliance.
Our businesses may be adversely affected by increased costs and liabilities resulting from such stricter laws and regulations. We try to anticipate future regulatory requirements that might be imposed and plan accordingly to remain in compliance with changing environmental laws and regulations and to minimize the costs of such compliance.
Results for Commercial Segment Our commercial sales were $1.0 billion and $1.3 billion for 2023 and 2022, respectively, decreasing $275.4 million, or 21%, due a decrease in prices, partially offset by an increase in volume sold.
Results for Commercial Segment Our commercial sales were $1.1 billion and $1.0 billion for 2024 and 2023, increasing $33.7 million, or 3%, primarily due an increase in volume sold, partially offset by a decrease in prices.
Net cash provided by operating activities was $512.4 million and $480.0 million for 2023 and 2022, respectively, for a period-over-period increase in cash flow from operating activities of $32.4 million.
Net cash provided by operating activities was $31.6 million and $512.4 million for 2024 and 2023, respectively, for a period-over-period decrease in cash flow from operating activities of $480.8 million.
Our station operations, which include (i) convenience store and prepared food sales at our directly operated stores, (ii) rental income from gasoline stations leased to dealers or from commissioned agents and from cobranding arrangements and (iii) sale of sundries, such as car wash sales and lottery and ATM commissions, collectively generated revenues of $572.2 million and $559.8 million for 2023 and 2022, respectively, an increase of $12.4 million, or 2%.
Our station operations, which include (i) convenience store and prepared food sales at our directly operated stores, (ii) rental income from gasoline stations leased to dealers or from commissioned agents and from cobranding arrangements and (iii) sale of sundries, such as car wash sales and lottery and ATM commissions, collectively generated revenues of $565.8 million and $572.2 million for 2024 and 2023, respectively, a decrease of $6.4 million, or 1%, primarily due to the sales and conversions of certain company-operated sites, offset by increases in sundries and rental income.
Except for net income, the primary drivers of the changes in operating activities include the following for the years ended December 31 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ 2023 2022 Increase in accounts receivable ​ $ (73,782) ​ $ (67,774) ​ Decrease (increase) in inventories ​ $ 172,112 ​ $ (52,086) ​ Increase in accounts payable ​ $ 117,777 ​ $ 177,644 ​ In 2023, the increases in accounts receivable and accounts payable are in part due to timing of sales and payments, offset by a decrease in prices.
Except for net income, the primary drivers of the changes in operating activities include the following for the years ended December 31 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Decrease (increase) in accounts receivable ​ $ 79,193 ​ $ (73,782) ​ (Increase) decrease in inventories ​ $ (200,412) ​ $ 172,112 ​ (Decrease) increase in accounts payable ​ $ (138,742) ​ $ 117,777 ​ In 2024, the decreases in accounts receivable and accounts payable are due in part to timing of sales and payments and to a decrease in prices.
Upon a continuing event of default, the trustee or the holders of at least 25% in principal amount of the 2032 Notes may declare the 2032 Notes immediately due and payable, except that an event of default resulting from entry into a bankruptcy, insolvency or reorganization with respect to the Issuers, any restricted subsidiary of ours that is a significant subsidiary or any group of our restricted subsidiaries that, taken together, would constitute a significant subsidiary of ours, will automatically cause the 2032 Notes to become due and payable. 84 Table of Contents The Issuers will have the option to redeem up to 35% of the 2032 Notes prior to January 15, 2027 at a redemption price (expressed as a percentage of principal amount) of 108.250% plus accrued and unpaid interest, if any.
Upon a continuing event of default, the trustee or the holders of at least 25% in principal amount of the 2032 Notes may declare the 2032 Notes immediately due and payable, except that an event of default resulting from entry into a bankruptcy, insolvency or reorganization with respect to the Issuers, any restricted subsidiary of ours that is a significant subsidiary or any group of our restricted subsidiaries that, taken together, would constitute a significant subsidiary of ours, will automatically cause the 2032 Notes to become due and payable.
Under this method with regard to SPR, our share of income and losses is included in the income from equity method investments in the accompanying consolidated statement of operations of Global Partners LP, and our investment balance in the joint venture is included in equity method investments in the accompanying consolidated balance sheet of Global Partners LP.
Under this method, our share of income and losses is included in (loss) income from equity method investments in the accompanying consolidated statements of operations of Global Partners LP, and our investment balance in the joint ventures are included in equity method investments in the accompanying consolidated balance sheets of Global Partners LP.
Results from our purchasing, storing, terminalling, transporting, selling and blending operations are influenced by prices for refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, price volatility and the market for such products. Prices in the overall markets for these products may affect our financial condition, results of operations and cash available for distribution to our unitholders.
Results from our purchasing, storing, terminalling, transporting, selling and blending operations are 64 Table of Contents influenced by prices for refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane, price volatility and the market for such products.
In addition, higher prices and inflation in general could reduce the demand for gasoline and the products and services we offer at our convenience stores and adversely impact our sales.
In addition, higher prices, including as result of tariffs and other controls on imports or exports of goods, and inflation in general could reduce the demand for gasoline and the products and services we offer at our convenience stores and adversely impact our sales.
On February 14, 2024, we paid the total cash distribution of approximately $26.8 million.
On February 14, 2025, we paid the total cash distribution of approximately $29.5 million.
(the “Issuers”) issued $450.0 million aggregate principal amount of 8.250% senior notes due 2032 (the “2032 Notes”) that are guaranteed by certain of our subsidiaries in a private placement exempt from the registration requirements under the Securities Act of 1933, as amended (the “Securities Act”).
See — Liquidity and Capital Resources — Credit Agreement.” 2032 Notes Offering —On January 18, 2024, we and GLP Finance Corp. issued $450.0 million aggregate principal amount of 8.250% senior notes due 2032 (the “2032 Notes”) that are guaranteed by certain of our subsidiaries in a private placement exempt from the registration requirements under the Securities Act of 1933, as amended.
Net Gain on Sale and Disposition of Assets Net gain on sale and disposition of assets was $2.6 million for 2023, primarily due to the sale of GDSO sites.
Amortization Expense Amortization expense related to our intangible assets was $8.2 million and $8.1 million for 2024 and 2023, respectively. Net Gain on Sale and Disposition of Assets Net gain on sale and disposition of assets was $9.5 million and $2.6 million for 2024 and 2023, respectively, primarily due to the sale of GDSO sites.
Income Tax Expense Income tax expense was $8.1 million and $16.8 million 2023 and 2022, respectively .
Income Tax Expense Income tax expense was $4.6 million and $8.1 million for 2024 and 2023, respectively.
Environmental Matters Our businesses of purchasing, storing, supplying and distributing refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane and other business activities, involves a number of activities that are subject to extensive and stringent environmental laws.
The financing obligation balance outstanding at December 31, 2024 was $59.8 million associated with this transaction. 83 Table of Contents Environmental Matters Our businesses of purchasing, storing, supplying and distributing refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane and other business activities, involves a number of activities that are subject to extensive and stringent environmental laws.
We account for our investment in Spring Partners Retail LLC (“SPR”) as an equity method investment.
We account for our investments in Spring Partners Retail LLC (“SPR”) and Everett Landco GP, LLC (“Everett”) as equity method investments.
These comparisons are not necessarily indicative of future results (gallons and dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2023 2022 Net income ​ $ 152,506 ​ $ 362,207 ​ EBITDA (1) ​ $ 356,363 ​ $ 565,084 ​ Adjusted EBITDA (1) ​ $ 356,264 ​ $ 485,211 ​ Distributable cash flow (2)(3) ​ $ 202,709 ​ $ 413,395 ​ Adjusted distributable cash flow (2) ​ $ 201,715 ​ $ 413,395 ​ Wholesale Segment: ​ ​ ​ ​ ​ ​ ​ Volume (gallons) ​ 3,681,530 ​ 3,408,709 ​ Sales ​ ​ ​ ​ ​ ​ ​ Gasoline and gasoline blendstocks ​ $ 5,897,428 ​ $ 6,408,184 ​ Distillates and other oils (4) ​ 3,715,888 ​ 4,455,309 ​ Total ​ $ 9,613,316 ​ $ 10,863,493 ​ Product margin ​ ​ ​ ​ ​ ​ ​ Gasoline and gasoline blendstocks ​ $ 105,165 ​ $ 106,982 ​ Distillates and other oils (4) ​ 96,747 ​ 180,715 ​ Total ​ $ 201,912 ​ $ 287,697 ​ Gasoline Distribution and Station Operations Segment: ​ ​ ​ ​ ​ ​ ​ Volume (gallons) ​ 1,628,305 ​ 1,648,104 ​ Sales ​ ​ ​ ​ ​ ​ ​ Gasoline ​ $ 5,268,268 ​ $ 6,140,823 ​ Station operations (5) ​ 572,266 ​ 559,826 ​ Total ​ $ 5,840,534 ​ $ 6,700,649 ​ Product margin ​ ​ ​ ​ ​ ​ ​ Gasoline ​ $ 558,516 ​ $ 588,676 ​ Station operations (5) ​ 276,040 ​ 267,941 ​ Total ​ $ 834,556 ​ $ 856,617 ​ Commercial Segment: ​ ​ ​ ​ ​ ​ ​ Volume (gallons) ​ 421,223 ​ 414,871 ​ Sales ​ $ 1,038,324 ​ $ 1,313,744 ​ Product margin ​ $ 31,722 ​ $ 40,973 ​ Combined sales and product margin: ​ ​ ​ ​ ​ ​ ​ Sales ​ $ 16,492,174 ​ $ 18,877,886 ​ Product margin (6) ​ $ 1,068,190 ​ $ 1,185,287 ​ Depreciation allocated to cost of sales ​ (94,550) ​ (87,638) ​ Combined gross profit ​ $ 973,640 ​ $ 1,097,649 ​ ​ ​ ​ ​ ​ ​ ​ ​ GDSO portfolio as of December 31, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ Company operated (7) ​ ​ 341 ​ ​ 353 ​ Commissioned agents ​ ​ 302 ​ ​ 295 ​ Lessee dealers ​ ​ 182 ​ ​ 192 ​ Contract dealers ​ ​ 802 ​ ​ 833 ​ Total GDSO portfolio ​ ​ 1,627 ​ ​ 1,673 ​ ​ 73 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2023 2022 Weather conditions: ​ ​ ​ ​ ​ ​ ​ Normal heating degree days ​ 5,630 ​ 5,630 ​ Actual heating degree days ​ 4,741 ​ 5,072 ​ Variance from normal heating degree days ​ (16) % ​ (10) % Variance from prior period actual heating degree days ​ (7) % 4 % (1) EBITDA and adjusted EBITDA are non-GAAP financial measures which are discussed above under “—Evaluating Our Results of Operations.” The table below presents reconciliations of EBITDA and adjusted EBITDA to the most directly comparable GAAP financial measures.
These comparisons are not necessarily indicative of future results (gallons and dollars in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2024 2023 Net income ​ $ 110,327 ​ $ 152,506 ​ EBITDA (1) ​ $ 389,394 ​ $ 356,363 ​ Adjusted EBITDA (1) ​ $ 388,893 ​ $ 356,264 ​ Distributable cash flow (2)(3) ​ $ 205,798 ​ $ 202,709 ​ Adjusted distributable cash flow (2) ​ $ 207,973 ​ $ 201,715 ​ Wholesale Segment: ​ ​ ​ ​ ​ ​ ​ Volume (gallons) ​ 4,597,008 ​ 3,681,530 ​ Sales ​ ​ ​ ​ ​ ​ ​ Gasoline and gasoline blendstocks ​ $ 6,541,224 ​ $ 5,897,428 ​ Distillates and other oils (4) ​ 4,176,681 ​ 3,715,888 ​ Total ​ $ 10,717,905 ​ $ 9,613,316 ​ Product margin ​ ​ ​ ​ ​ ​ ​ Gasoline and gasoline blendstocks ​ $ 181,802 ​ $ 105,165 ​ Distillates and other oils (4) ​ 110,430 ​ 96,747 ​ Total ​ $ 292,232 ​ $ 201,912 ​ Gasoline Distribution and Station Operations Segment: ​ ​ ​ ​ ​ ​ ​ Volume (gallons) ​ 1,584,269 ​ 1,628,305 ​ Sales ​ ​ ​ ​ ​ ​ ​ Gasoline ​ $ 4,807,765 ​ $ 5,268,268 ​ Station operations (5) ​ 565,839 ​ 572,266 ​ Total ​ $ 5,373,604 ​ $ 5,840,534 ​ Product margin ​ ​ ​ ​ ​ ​ ​ Gasoline ​ $ 578,737 ​ $ 558,516 ​ Station operations (5) ​ 281,745 ​ 276,040 ​ Total ​ $ 860,482 ​ $ 834,556 ​ Commercial Segment: ​ ​ ​ ​ ​ ​ ​ Volume (gallons) ​ 469,660 ​ 421,223 ​ Sales ​ $ 1,072,057 ​ $ 1,038,324 ​ Product margin ​ $ 31,354 ​ $ 31,722 ​ Combined sales and product margin: ​ ​ ​ ​ ​ ​ ​ Sales ​ $ 17,163,566 ​ $ 16,492,174 ​ Product margin (6) ​ $ 1,184,068 ​ $ 1,068,190 ​ Depreciation allocated to cost of sales ​ (126,172) ​ (94,550) ​ Combined gross profit ​ $ 1,057,896 ​ $ 973,640 ​ ​ ​ ​ ​ ​ ​ ​ ​ GDSO portfolio as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ Company operated (7) ​ ​ 300 ​ ​ 341 ​ Commissioned agents ​ ​ 318 ​ ​ 302 ​ Lessee dealers ​ ​ 174 ​ ​ 182 ​ Contract dealers ​ ​ 792 ​ ​ 802 ​ Total GDSO portfolio ​ ​ 1,584 ​ ​ 1,627 ​ ​ 71 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ 2024 2023 Weather conditions: ​ ​ ​ ​ ​ ​ ​ Normal heating degree days ​ 5,661 ​ 5,630 ​ Actual heating degree days ​ 4,921 ​ 4,741 ​ Variance from normal heating degree days ​ (13) % ​ (16) % Variance from prior period actual heating degree days ​ 4 % (7) % (1) EBITDA and adjusted EBITDA are non-GAAP financial measures which are discussed above under “—Evaluating Our Results of Operations.” The table below presents reconciliations of EBITDA and adjusted EBITDA to the most directly comparable GAAP financial measures.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAt December 31, 2023, the fair value of all of our commodity risk derivative instruments and the change in fair value that would be expected from a 10% price increase or decrease are shown in the table below (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value at Gain (Loss) ​ ​ December 31, ​ Effect of 10% Effect of 10% ​ ​ 2023 ​ Price Increase ​ Price Decrease Exchange traded derivative contracts ​ $ 33,421 ​ $ (18,458) ​ $ 18,458 ​ Forward derivative contracts ​ 12,669 ​ (13,072) ​ 13,072 ​ Total ​ $ 46,090 ​ $ (31,530) ​ $ 31,530 ​ The fair values of the futures contracts are based on quoted market prices obtained from the NYMEX, CME and ICE.
Biggest changeGenerally, our practice is to close all exchange positions rather than to make or receive physical deliveries. 86 Table of Contents At December 31, 2024, the fair value of all of our commodity risk derivative instruments and the change in fair value that would be expected from a 10% price increase or decrease are shown in the table below (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value at Gain (Loss) ​ ​ December 31, ​ Effect of 10% Effect of 10% ​ ​ 2024 ​ Price Increase ​ Price Decrease Exchange traded derivative contracts ​ $ (1,808) ​ $ (35,940) ​ $ 35,940 ​ Forward derivative contracts ​ 7,605 ​ (11,233) ​ 11,233 ​ Total ​ $ 5,797 ​ $ (47,173) ​ $ 47,173 ​ The fair values of the futures contracts are based on quoted market prices obtained from the NYMEX, CME and ICE.
The fair value of the swaps and option contracts are estimated based on quoted prices from various sources such as independent reporting services, industry publications and brokers. These quotes are compared to the contract price of the swap, which approximates the gain or loss that would have been realized if the contracts had been closed out at December 31, 2023.
The fair value of the swaps and option contracts are estimated based on quoted prices from various sources such as independent reporting services, industry publications and brokers. These quotes are compared to the contract price of the swap, which approximates the gain or loss that would have been realized if the contracts had been closed out at December 31, 2024.
While we seek to maintain a position that is substantially balanced within our commodity product purchase and sales activities, we may experience net unbalanced positions for short periods of time as a result of variances in daily purchases and sales and transportation and delivery schedules as well as other logistical issues inherent in our businesses, 89 Table of Contents such as weather conditions.
While we seek to maintain a position that is substantially balanced within our commodity product purchase and sales activities, we may experience net unbalanced positions for short periods of time as a result of variances in daily purchases and sales and transportation and delivery schedules as well as other logistical issues inherent in our businesses, such as weather conditions.
Accordingly, the fair value of our exchange-traded derivative instruments is presented on a net basis in the consolidated balance sheet. Exposure on physical forward contracts and swap agreements is limited to the amount of the recorded fair value as of the balance sheet dates. 90 Table of Contents Item 8. Financial Statements and Supplementary Dat a.
Accordingly, the fair value of our exchange-traded derivative instruments is presented on a net basis in the consolidated balance sheet. Exposure on physical forward contracts and swap agreements is limited to the amount of the recorded fair value as of the balance sheet dates. Item 8. Financial Statements and Supplementary Dat a.
As of December 31, 2023, we had total borrowings outstanding under our credit agreement of $396.8 million. Please read Part II, Item 7, “Management’s Discussion and Analysis—Liquidity and Capital Resources—Credit Agreement,” for information on interest rates related to our borrowings.
As of December 31, 2024, we had total borrowings outstanding under our credit agreement of $396.5 million. Please read Part II, Item 7, “Management’s Discussion and Analysis—Liquidity and Capital Resources—Credit Agreement,” for information on interest rates related to our borrowings.
In connection with managing these positions, we are aided by maintaining a constant presence in the marketplace. We also engage in a controlled trading program for up to an aggregate of 250,000 barrels of commodity products at any one point in time.
In connection with managing these positions, we are aided by maintaining a constant presence in the marketplace. We also engage in a controlled trading program with an aggregate outright commodity exposure of up to 250,000 barrels at any one point in time.
We have a daily margin requirement to maintain a cash deposit with our brokers based on the prior day’s market results on open futures contracts. The balance of this deposit will fluctuate based on our open market positions and the commodity exchange’s requirements. The brokerage margin balance was $12.8 million at December 31, 2023.
We have a daily margin requirement to maintain a cash deposit with our brokers based on the prior day’s market results on open futures contracts. The balance of this deposit will fluctuate based on our open market positions and the commodity exchange’s requirements. The brokerage margin balance was $20.1 million at December 31, 2024.
These instruments may include foreign currency exchange contracts and forwards. In conjunction with entering into the commodity derivative, we may enter into a foreign currency derivative to hedge the resulting foreign currency risk. These foreign currency derivatives are generally short-term in nature and not designated for hedge accounting.
In conjunction with entering into the commodity derivative, we may enter into a foreign currency derivative to hedge the resulting foreign currency risk. These foreign currency derivatives are generally short-term in nature and not designated for hedge accounting.
Changes in the fair value of these derivative instruments are recognized in the consolidated statements of operations through cost of sales. In addition, because a portion of our crude oil business may be conducted in Canadian dollars, we may use foreign currency derivatives to minimize the risks of unfavorable exchange rates.
Changes in the fair value of these derivative instruments are recognized in the consolidated statements of operations through cost of sales. We may use foreign currency derivatives to minimize the risks of unfavorable exchange rates. These instruments may include foreign currency exchange contracts and forwards.
We utilize regulated exchanges, including the NYMEX, CME and ICE, which are exchanges for the respective commodities that each trades, thereby reducing potential delivery and supply risks. Generally, our practice is to close all exchange positions rather than to make or receive physical deliveries.
We utilize regulated exchanges, including the NYMEX, CME and ICE, which are exchanges for the respective commodities that each trades, thereby reducing potential delivery and supply risks.

Other GLP 10-K year-over-year comparisons