As filed with the Securities and Exchange Commission on September 13, 2010

Registration No. 333-168090

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

 

 

 

AMENDMENT NO. 2

TO

Form S-4

 

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

 

 

Buckeye Partners, L.P.

(Exact name of registrant as specified in its charter)

 

 

One Greenway Plaza

Suite 600

Houston, Texas 77046

(832) 615-8600

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

 

 

 

 

William H. Schmidt, Jr.

Vice President, General Counsel and Secretary

One Greenway Plaza

Suite 600

Houston, Texas 77046

(832) 615-8600

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

 

 

Copies to:

 

 

 

 

Approximate date of commencement of proposed sale of the securities to the public:  As soon as practicable after the effective date of this registration statement and the effective time of the merger pursuant to the merger agreement described in the enclosed joint proxy statement/prospectus.

 

 

 

 

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  o

 

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

 

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

 

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

 

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)       o

 

Exchange Act Rule 14d-1(d) (Cross-Border Third Party Tender Offer) o

 

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

Subject to completion, dated September 13, 2010

 

MERGER PROPOSED — YOUR VOTE IS VERY IMPORTANT

 

Buckeye Partners, L.P. (the “Partnership”), Buckeye GP LLC, the general partner of the Partnership (the “Partnership GP”), Grand Ohio, LLC, a wholly-owned subsidiary of the Partnership (“MergerCo”), Buckeye GP Holdings L.P. (“Holdings”), and MainLine Management LLC, Holdings’ general partner (“Holdings GP”), have entered into a First Amended and Restated Agreement and Plan of Merger dated as of August 18, 2010 (the “merger agreement”). Under the merger agreement, the Partnership will acquire Holdings through a merger of MergerCo with and into Holdings (the “merger”), and all common units and management units of Holdings (“Holdings units”) will be converted into limited partner interests of the Partnership represented by limited partnership units (“Partnership LP units”). As a result of the merger, Holdings will be a subsidiary of the Partnership, with the Partnership as Holdings’ sole limited partner and Holdings GP remaining as the non-economic general partner of Holdings. In connection with the merger, the incentive compensation agreement (the “incentive distribution rights,” or the “IDRs”) held by the Partnership GP will be cancelled and the general partner units held by the Partnership GP (representing an approximate 0.5% general partner interest in the Partnership) will be converted to a non-economic general partner interest in the Partnership pursuant to the Partnership’s amended and restated partnership agreement (the “amended and restated partnership agreement”). The merger agreement is attached as Annex A to this joint proxy statement/prospectus and is incorporated into this joint proxy statement/prospectus by reference. The form of the Partnership’s amended and restated partnership agreement is attached as Annex B to this joint proxy statement/prospectus and is incorporated into this joint proxy statement/prospectus by reference.

 

Pursuant to the merger agreement, the Partnership will issue to the holders of Holdings common units and management units (the “Holdings unitholders”) approximately 20 million Partnership LP units in the merger. Each unitholder of Holdings will receive 0.705 Partnership LP units per Holdings unit (the “stated consideration”). The stated consideration represents a 32% premium to the closing price of Holdings common units on June 10, 2010, the last trading day before the public announcement of the proposed merger.

 

The holders of Partnership LP units (the “Partnership unitholders”) will continue to own their existing Partnership LP units. Following the merger, the Partnership will be owned approximately 72% by current Partnership unitholders and approximately 28% by former Holdings unitholders (including 17% that will be owned by BGH GP Holdings, LLC, the sole member of Holdings GP (“BGH GP”)). The Partnership LP units will continue to be traded on the New York Stock Exchange under the symbol “BPL” following the merger.

 

YOUR VOTE IS VERY IMPORTANT.  We cannot complete the merger unless, among other things, (a) the Partnership unitholders approve the merger agreement and the transactions contemplated thereby, including the merger, the issuance of Partnership LP units pursuant to the merger agreement and the amended and restated partnership agreement and (b) the Holdings unitholders approve the merger, the merger agreement and the transactions contemplated thereby at the special meetings of the Partnership unitholders and Holdings unitholders.

 

The Partnership will hold a special meeting on          , 2010 at  :00 a.m., local time, at the Four Seasons Hotel, 1300 Lamar Street, Houston, Texas 77010. Holdings will hold a special meeting on          , 2010 at  :00 a.m., local time, at the Four Seasons Hotel, 1300 Lamar Street, Houston, Texas 77010. Whether or not you plan to attend your meeting, to ensure your units are represented at the meeting, please complete and submit the enclosed proxy card as soon as possible or transmit your voting instructions by using the telephone or internet as described on your proxy card.

 

The Audit Committee (the “Partnership Audit Committee”) of the board of directors of the Partnership GP (the “Partnership Board”), comprised of independent directors, to which the Partnership Board has delegated full authority to negotiate and approve the merger and any definitive documentation related to the merger, has unanimously approved and declared the advisability of the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units pursuant thereto, and has determined that the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units pursuant to the merger agreement, are fair and reasonable to and in the best interests of, the Partnership and the unaffiliated Partnership unitholders. Accordingly, the Partnership Audit Committee unanimously recommends that the Partnership unitholders vote to approve the merger agreement

and the transactions contemplated thereby, including the merger and the issuance of the Partnership LP units pursuant to the merger agreement. In addition, the Partnership Audit Committee has unanimously approved and declared the advisability of the amended and restated partnership agreement, has determined that the amended and restated partnership agreement is fair and reasonable to, and in the best interest of, the Partnership and the unaffiliated Partnership unitholders, and unanimously recommends that the Partnership unitholders vote to approve the amended and restated partnership agreement.

 

The board of directors of Holdings GP (the “Holdings Board”) has unanimously (with the director who is also the chief executive officer of the Partnership GP and Holdings GP recusing himself) approved and declared the advisability of the merger, the merger agreement and the transactions completed thereby and determined that the merger, the merger agreement and the transactions contemplated thereby are fair and reasonable to, and in the best interests of, Holdings and the Holdings unitholders. Accordingly, the Holdings Board unanimously recommends that the Holdings unitholders vote to approve the merger, the merger agreement and the transactions contemplated thereby.

 

This joint proxy statement/prospectus gives you detailed information about the special meetings and the proposed merger. The Partnership and Holdings both urge you to read carefully this entire joint proxy statement/prospectus, including all of its annexes. In particular, please read “Risk Factors” beginning on page 24 of this joint proxy statement/prospectus for a discussion of risks relevant to the merger, the Partnership and other matters.

 

The Partnership LP units are traded on the New York Stock Exchange under the symbol “BPL.” The last reported sale price of the Partnership LP units on the New York Stock Exchange on September 10, 2010 was $62.65. Holdings common units are traded on the New York Stock Exchange under the symbol “BGH.” The last reported sale price of Holdings common units on the New York Stock Exchange on September 10, 2010 was $42.47.

 

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this joint proxy statement/prospectus or has passed upon the adequacy or accuracy of the disclosure in this joint proxy statement/prospectus. Any representation to the contrary is a criminal offense.

 

This joint proxy statement/prospectus is dated          , 2010 and is first being mailed to the Partnership unitholders and the Holdings unitholders on or about          , 2010.

NOTICE OF SPECIAL MEETING OF
BUCKEYE PARTNERS, L.P. UNITHOLDERS
TO BE HELD ON          , 2010

 

To the Unitholders of Buckeye Partners, L.P.:

 

This is a notice that a special meeting of the unitholders of Buckeye Partners, L.P. (the “Partnership”) will be held on          , 2010 at  :00 a.m., local time, at the Four Seasons Hotel, 1300 Lamar Street, Houston, Texas 77010. The purpose of the special meeting is:

 

1. To consider and vote upon the approval of a First Amended and Restated Agreement and Plan of Merger (the “merger agreement”) by and among the Partnership, Buckeye GP LLC, the general partner of the Partnership (the “Partnership GP”), Grand Ohio, LLC (“MergerCo”), Buckeye GP Holdings L.P. (“Holdings”) and MainLine Management LLC, the general partner of Holdings (“Holdings GP”), dated as of August 18, 2010, as such agreement may be amended from time to time, and the transactions contemplated thereby, including (i) the merger of MergerCo with and into Holdings with Holdings surviving as a subsidiary of the Partnership, the Partnership becoming Holdings’ sole limited partner and Holdings GP remaining as the sole general partner of Holdings and (ii) the issuance of limited partner interests of the Partnership represented by limited partnership units (“Partnership LP units”) pursuant to the merger agreement;

 

2. To consider and vote upon the approval of the Amended and Restated Agreement of Limited Partnership of the Partnership (the “amended and restated partnership agreement,” a copy of which is attached as Annex B to this joint proxy statement/prospectus); and

 

3. To transact such other business as may properly come before the special meeting and any adjournment or postponement thereof.

 

Pursuant to the merger agreement (i) MergerCo will merge with and into Holdings and Holdings will survive as a subsidiary of the Partnership with the Partnership as Holdings’ sole limited partner and Holdings GP remaining as the sole general partner of Holdings and (ii) all common units and management units of Holdings will be converted into Partnership LP units (a copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus).

 

The Audit Committee of the board of directors of the Partnership GP (the “Partnership Audit Committee”), comprised of independent directors, has unanimously approved and declared the advisability of the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units pursuant thereto, and has determined that the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units pursuant to the merger agreement, are fair and reasonable to, and in the best interests of, the Partnership and the holders of Partnership LP units (the “Partnership unitholders”) who are not affiliated with the Partnership GP. Accordingly, the Partnership Audit Committee unanimously recommends that the Partnership unitholders vote to approve the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units pursuant to the merger agreement. In addition, the Partnership Audit Committee has unanimously approved and declared the advisability of the amended and restated partnership agreement, has determined that the amended and restated partnership agreement is fair and reasonable to, and in the best interest of, the Partnership and the unaffiliated Partnership unitholders, and unanimously recommends that the Partnership unitholders vote to approve the amended and restated partnership agreement.

 

The proposals described in paragraphs 1 and 2 above require the affirmative vote of the holders of a majority of the Partnership’s outstanding LP units entitled to vote as of the record date. The approval of the proposals described in paragraphs 1 and 2 is a condition to consummation of the merger. Only Partnership unitholders of record at the close of business on          , 2010, the record date, are entitled to receive this notice and to vote at the Partnership special meeting or any adjournment or postponement of that meeting.

 

YOUR VOTE IS VERY IMPORTANT.  Whether or not you plan to attend the special meeting, please submit your proxy with voting instructions as soon as possible. If you hold Partnership LP units in your name as a unitholder of record, please complete, sign, date and return the accompanying proxy card in the enclosed self-addressed stamped envelope, use the toll-free telephone number shown on the proxy card or use the

internet website shown on the proxy card. If you hold your Partnership LP units through a bank or broker, please use the voting instructions you have received from your bank or broker. Submitting your proxy will not prevent you from attending the Partnership special meeting and voting in person. Please note, however, that if you hold your Partnership LP units through a bank or broker, and you wish to vote in person at the Partnership special meeting, you must obtain from your bank or broker a proxy issued in your name. You may revoke your proxy by attending the Partnership special meeting and voting your Partnership LP units in person at the special meeting. You may also revoke your proxy at any time before it is voted by giving written notice of revocation to Computershare Trust Company, N.A. at the address provided with the proxy card at or before the Partnership special meeting or by submitting a proxy with a later date.

 

The accompanying document describes the proposed merger in more detail. We urge you to read carefully the entire document before voting your Partnership LP units at the Partnership special meeting or submitting your voting instructions by proxy.

 

By Order of the Audit Committee of the Board of Directors of Buckeye GP LLC, the general partner of Buckeye Partners, L.P.

 

William H. Schmidt, Jr.

Secretary

 

Houston, Texas

          , 2010

NOTICE OF SPECIAL MEETING OF
BUCKEYE GP HOLDINGS L.P. UNITHOLDERS
TO BE HELD ON          , 2010

 

To the Unitholders of Buckeye GP Holdings L.P.:

 

This is a notice that a special meeting of the unitholders of Buckeye GP Holdings L.P. (“Holdings”) will be held on          , 2010 at   a.m., local time, at the Four Seasons Hotel, 1300 Lamar Street, Houston, Texas 77010. The purpose of the special meeting is:

 

1. To consider and vote upon the approval of (a) the First Amended and Restated Agreement and Plan of Merger (the “merger agreement”) by and among Holdings, Buckeye Partners, L.P. (the “Partnership”), Buckeye GP LLC, the general partner of the Partnership (the “Partnership GP”), Grand Ohio, LLC, a wholly owned subsidiary of the Partnership (“MergerCo”), and MainLine Management LLC, the general partner of Holdings (“Holdings GP”), dated as of August 18, 2010, as such agreement may be amended from time to time, pursuant to which (i) MergerCo will merge with and into Holdings and Holdings will survive as a subsidiary of the Partnership with the Partnership as Holdings’ sole limited partner and Holdings GP remaining as the sole general partner of Holdings and (ii) all common units and management units of Holdings will be converted into limited partner interests of the Partnership represented by limited partnership units (“Partnership LP units”) (a copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus), (b) the merger, and (c) the transactions contemplated thereby; and

 

2. To transact such other business as may properly come before the special meeting and any adjournment or postponement thereof.

 

The board of directors of Holdings GP (the “Holdings Board”) has unanimously (with the director who is also the chief executive officer of the Partnership GP and Holdings GP recusing himself) approved and declared the advisability of the merger, the merger agreement and the transactions contemplated thereby and determined that the merger, the merger agreement and the transactions contemplated thereby are fair and reasonable to, and in the best interests of, Holdings and the holders of Holdings common units and management units (the “Holdings unitholders”). Accordingly, the Holdings Board unanimously recommends that the Holdings unitholders vote to approve the merger, the merger agreement and the transactions contemplated thereby.

 

The proposal described in paragraph 1 above requires the affirmative vote of the holders of (A) a majority of the common units of Holdings outstanding and entitled to vote at the meeting as of the record date, voting as a separate class, and (B) a majority of the common units and management units of Holdings outstanding and entitled to vote at the meeting as of the record date, voting together as a single class. The approval and adoption of the proposal described in paragraph 1 is a condition to consummation of the merger. Only Holdings unitholders of record at the close of business on          , 2010, the record date, are entitled to receive this notice and to vote at the Holdings special meeting or any adjournment or postponement of that meeting.

 

Whether or not you plan to attend the Holdings special meeting, please submit your proxy with voting instructions as soon as possible. If you hold units in your name as a unitholder of record, please complete, sign, date and return the accompanying proxy card in the enclosed self-addressed stamped envelope, use the toll-free telephone number shown on the proxy card or use the internet website shown on the proxy card. If you hold your units through a bank or broker, please use the voting instructions you have received from your bank or broker. Submitting your proxy will not prevent you from attending the Holdings special meeting and voting in person. Please note, however, that if you hold your units through a bank or broker, and you wish to vote in person at the Holdings special meeting, you must obtain from your bank or broker a proxy issued in your name. You may revoke your proxy by attending the Holdings special meeting and voting your shares in person at the Holdings special meeting. You may also revoke your proxy at any time before it is voted by giving written notice of revocation to Computershare Trust Company, N.A. at the address provided with the proxy card at or before the Holdings special meeting or by submitting a proxy with a later date.

The accompanying document describes the proposed merger in more detail. We urge you to read carefully the entire document before voting your shares at the Holdings special meeting or submitting your voting instructions by proxy.

 

By Order of the Board of Directors of MainLine Management LLC, the general partner of Buckeye GP Holdings L.P.

 

William H. Schmidt, Jr.

Secretary

 

Houston, Texas

          , 2010

 

TABLE OF CONTENTS

 

 

This joint proxy statement/prospectus, which forms part of a registration statement on Form S-4 filed with the Securities and Exchange Commission (the “SEC”), constitutes a proxy statement under Section 14(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of (a) the Partnership with respect to the solicitation of proxies for the Partnership special meeting to, among other things, approve the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units, and to approve the Partnership’s amended and restated partnership agreement; and (b) Holdings with respect to the solicitation of proxies for the Holdings special meeting to, among other things, approve the merger, the merger agreement and the transactions contemplated thereby. This joint proxy statement/prospectus is also a prospectus of the Partnership under Section 5 of the Securities Act of 1933, as amended (the “Securities Act”), for the Partnership LP units that Holdings unitholders will receive in the merger.

 

As permitted under the rules of the SEC, this joint proxy statement/prospectus incorporates by reference important business and financial information about the Partnership and Holdings from other documents filed with the SEC that are not included in or delivered with this joint proxy statement/prospectus. Please read “Where You Can Find More Information” beginning on page 155. This information is available to you without charge upon your request. You can obtain documents incorporated by reference in this joint proxy statement/prospectus by requesting them in writing or by telephone from the Partnership or Holdings at the following addresses and telephone numbers:

 

 

Please note that copies of the documents provided to you will not include exhibits.

 

You may obtain certain of these documents at the Partnership’s website, www.buckeye.com, by selecting “Investor Center” and then selecting “SEC Filings,” and at Holdings’ website, www.buckeyegp.com, by selecting “Investor Center” and then selecting “SEC Filings.” Information contained on the Partnership’s and Holdings’ websites is expressly not incorporated by reference into this joint proxy statement/prospectus.

 

In order to receive timely delivery of the documents in advance of the Partnership special meeting and Holdings special meeting, your request should be received no later than          , 2010.

 

The Partnership and Holdings have not authorized anyone to give any information or make any representation about the merger and related matters or about the Partnership or Holdings that is different from, or in addition to, that contained in this joint proxy statement/prospectus or in any of the materials that have been incorporated into this joint proxy statement/prospectus. Therefore, if anyone distributes this type of information, you should not rely on it. If you are in a jurisdiction where offers to exchange or sell, or solicitations of offers to exchange or purchase, the securities offered by this joint proxy statement/prospectus or the solicitation of proxies is unlawful, or you are a person to whom it is unlawful to direct these types of activities, then the offer presented in this joint proxy statement/prospectus does not extend to you. The information contained in this joint proxy statement/prospectus speaks only as of the date of this joint proxy statement/prospectus unless the information specifically indicates that another date applies.

 

In the following questions and answers, selected information from this joint proxy statement/prospectus has been highlighted but all of the information that may be important to the holders of Partnership LP units and the holders of Holdings units regarding the merger and the other transactions contemplated by the merger agreement has not been included. To better understand the merger and the other transactions contemplated by the merger agreement, and for a complete description of their legal terms, please read carefully this joint proxy statement/prospectus in its entirety, including all of its annexes, as well as the documents incorporated by reference in this joint proxy statement/prospectus. Please read “Important Note About this Joint Proxy Statement/Prospectus” on page v and “Where You Can Find More Information” beginning on page 155.

 

 

 

 

 

 

 

 

 

 

 

 

Morrow & Co., LLC
470 West Avenue — 3^rd Floor
Stamford, CT 06902

Banks and brokers call: (203) 658-9400
Unitholders call toll-free: (800) 573-4412
Email: buckeye.info@morrowco.com

 

SUMMARY

 

The Proposed Merger (page 85)

 

Merger Consideration (page 91)

 

Transactions Related to the Merger (page 86)

 

Directors and Executive Officers of the Partnership GP Following the Merger (page 142)

 

Recommendation of the Partnership Audit Committee and Its Reasons for the Merger (page 48)

 

Recommendation of the Holdings Board and Its Reasons for the Merger (page 51)

 

Conditions to the Completion of the Merger (page 100)

 

The Parties to the Merger Agreement (page 76)

	•	the indirect ownership of the incentive distribution rights in the Partnership;
	•	the indirect ownership of the general partner interests in certain of the Partnership’s operating subsidiaries (representing an approximate 1% interest in each of such operating subsidiaries);
	•	the indirect ownership of the general partner interests in the Partnership (representing 243,914 GP units), or an approximate 0.5% interest in the Partnership; and
	•	80,000 Partnership LP units.

 

Relationship of the Parties (page 76)

														Six Months
														Ended
		Year Ended December 31,												June 30,
		2007				2008				2009				2010
Incentive distributions from the Partnership		$	29,978			$	38,895			$	45,739			$	24,918
Distributions from the ~ 1% ownership in certain of the Partnership’s operating subsidiaries			1,292				1,131				1,955				403
Distribution from the ownership of 243,914 GP units			786				835				884				460
Distribution from the ownership of 80,000 Partnership LP units			258				274				290				151
		$	32,314			$	41,135			$	48,868			$	25,932

 

Information About the Special Meetings and Voting (page 78)

	•	a proposal to approve the merger agreement and the transactions contemplated thereby, including the merger and the issuance of Partnership LP units pursuant to the merger agreement;
	•	a proposal to approve the Partnership’s amended and restated partnership agreement; and
	•	any proposal to transact such other business as may properly come before the Partnership special meeting and any adjournment or postponement thereof.

	•	a proposal to approve the merger, the merger agreement and the transactions contemplated thereby; and
	•	any proposal to transact such other business as may properly come before the Holdings special meeting and any adjournment or postponement thereof.

Risk Factors (page 24)

	•	the directors and executive officers of the Partnership GP and of Holdings GP may have interests that differ from your interests;
	•	at the effective time, the market value of the Partnership LP units to be received in the merger could decrease and Holdings unitholders cannot be sure of the market value of such Partnership LP units;
	•	no ruling has been obtained with respect to the tax consequences of the merger; and
	•	the benefits of the merger may not be realized.

Appraisal Rights (page 87)

 

No Solicitation of Other Offers by Holdings (page 99)

 

Termination of the Merger Agreement (page 102)

	•	by mutual written consent of Holdings and the Partnership;
	•	by either Holdings or the Partnership upon written notice to the other:

	•	if the merger is not completed on or before December 31, 2010, unless the failure of the closing to occur by this date is primarily due to the failure of the party seeking to terminate the merger agreement to fulfill any material obligation under the merger agreement or a material breach of the merger agreement by such party. Either the Partnership or Holdings may extend the termination date to February 28, 2011 unless a change in U.S. law has been adopted such that gain or loss would be recognized by holders of Holdings units upon exchange of such Holdings units for Partnership LP units (other than gain resulting from any decrease in partnership liabilities pursuant to Section 752 of the Internal Revenue Code or cash or other property distributions);
	•	if any regulatory authority has issued a final and nonappealable statute, rule, order, decree or regulation or taken any other action that permanently restrains, enjoins or prohibits the consummation of the merger; provided, that the terminating party is not in breach of its covenant to use commercially reasonable best efforts to complete the merger promptly;
	•	if Holdings fails to get the necessary unitholder approval at the Holdings special meeting, subject to certain limitations;
	•	if there has been a material breach of any agreements or covenants, or there is any material inaccuracy in any of the representations or warranties of any of the other parties set forth in the merger agreement under certain circumstances;
	•	if the Partnership fails to get the necessary unitholder approval at the Partnership special meeting, subject to certain limitations;

	•	by the Partnership if the Holdings Board makes a change in recommendation;
	•	by Holdings if:

	•	prior to obtaining the necessary unitholder approval at the Holdings special meeting, Holdings receives a third party acquisition proposal which the Holdings Board concludes, in good faith, is a superior proposal; the Holdings Board makes a change in recommendation; Holdings has not knowingly and intentionally breached the no solicitation provisions of the merger agreement; and Holdings subsequently enters into an agreement for the superior proposal, and pays the termination fee described below; or
	•	the Partnership Audit Committee makes a change in recommendation regarding the merger.

 

Termination Fees and Expenses (page 103)

	•	Holdings will be obligated to pay a fee to the Partnership equal to $29.0 million in cash, reduced by certain amounts paid, if:

	•	the merger agreement is terminated by the Partnership because the Holdings Board makes a change in recommendation regarding the merger;
	•	after an acquisition proposal for 50% or more of the assets of, the equity interest in or businesses of Holdings has been made to the Holdings unitholders or an intention to make such an acquisition proposal has been made known, the merger agreement is terminated by either the Partnership or Holdings because the merger was not consummated by the termination date or Holdings failed to obtain the requisite unitholder approvals or by the Partnership because of a breach of Holdings’ representations and warranties or agreements and covenants and, in either case, within 12 months after the merger agreement is terminated, Holdings enters into a definitive agreement in respect of any acquisition proposal and consummates the transaction contemplated by such definitive agreement (which need not be the same acquisition proposal as the acquisition proposal first mentioned in this paragraph); or
	•	the merger agreement is terminated by Holdings to enter into a superior proposal under certain circumstances.

	•	The Partnership will be obligated to pay a fee to Holdings equal to $29.0 million in cash if the Partnership Audit Committee makes a change in recommendation regarding the merger and Holdings terminates the merger agreement because of such change in recommendation.

	•	Holdings will be obligated to pay the Partnership’s expenses, not to exceed $6.0 million, if the merger agreement is terminated by:

	•	the Partnership because of a breach of Holdings’ or Holdings GP’s material representations and warranties or agreements and covenants; or
	•	the Partnership or Holdings because Holdings failed to obtain the requisite approvals from its unitholders.

	•	The Partnership will be obligated to pay Holdings’ expenses, not to exceed $6.0 million, if the merger agreement is terminated by:

	•	Holdings because of a breach of the Partnership’s or the Partnership GP’s material representations and warranties or agreements and covenants; or
	•	Holdings or the Partnership because the Partnership failed to obtain the requisite approvals from its unitholders.

 

Opinion of Barclays Capital Inc. — Financial Advisor to the Partnership Audit Committee (page 56)

 

Opinion of Credit Suisse Securities (USA) LLC — Financial Advisor to the Holdings Board (page 67)

 

Comparison of Partnership Unitholder Rights and Holdings Unitholder Rights (page 146)

 

Interests of Certain Persons in the Merger (page 138)

	•	Holdings and Partnership Units.  Some of the executive officers and directors of the Partnership GP and Holdings GP currently own Holdings units and will be receiving Partnership LP units as a result of the merger. Holdings units held by the directors and executive officers will be converted into Partnership LP units at a ratio of 0.705 Partnership LP units per Holdings unit. This is the same ratio as that applicable to all other holders of Holdings units. In addition, certain directors and officers of the Partnership GP and Holdings GP currently own Partnership LP units.
	•	Indemnification and Insurance.  The merger agreement provides for indemnification by the Partnership and Holdings of each person who was, as of the date of the merger agreement, or is at any time from the date of the merger agreement through the effective date, an officer or director of Holdings or any of its subsidiaries or acting as a fiduciary under or with respect to any employee benefit plan of Holdings and for the maintenance of directors’ and officers’ liability insurance covering directors and executive officers of Holdings GP for a period of six years following the merger. The Partnership and MergerCo also agreed that all rights to indemnification now existing in favor of indemnified parties as provided in the Holdings agreement of limited partnership (or, as applicable, the charter, bylaws, partnership agreement, limited liability company agreement, or other organizational documents of any of Holdings’ subsidiaries) and the indemnification agreements of Holdings or any of its subsidiaries will be assumed by Holdings, the Partnership and the Partnership GP in the merger, without further action, at the effective time of the merger and will survive the merger and will continue in full force and effect in accordance with their terms.
	•	Director and Executive Officer Interlock.  Certain of Holdings GP’s directors and all of Holdings GP’s executive officers are currently directors and executive officers of the Partnership GP, respectively, and are expected to remain directors and executive officers of the Partnership GP following the merger. Messrs. Wylie, Smith, St.Clair and Schmidt are officers of BGH GP. Mr. Wylie is a director of BGH GP. After the effective time, the Partnership Board is expected to consist of nine members, three of whom are expected to be the existing members of the Partnership Audit Committee, one of whom is expected to be the existing chief executive officer of the Partnership GP and three of whom are expected to be the three existing members of the audit committee of the Holdings Board. The amended and restated partnership agreement of the Partnership will provide that, following (a) the receipt of approvals from the CPUC and the PaPUC of the public election provisions or (b) a determination by the Partnership Board that such approvals are not required, Holdings GP shall have the right to designate (a) two directors for so long as BGH GP, ArcLight Capital Partners, LLC (“ArcLight”) and Kelso & Company (“Kelso”) and their affiliates (directly and indirectly) own at least 10,495,107 Partnership LP units (85% of the number they will own after the closing of the merger) or (b) one director for so long as they own at least 5,247,554 Partnership LP units (42.5% of the number they will own after the closing of the merger).
	•	Interests in BGH GP.  In addition, all of the executive officers and certain of the directors of the Partnership GP and Holdings GP have limited liability company interests in BGH GP, which owns approximately 61% of the total Holdings common units and 97% of the total Holdings management units and has entered into a support agreement and registration rights agreement. For more information

		on the support agreement and registration rights agreement, please read “The Proposed Merger — Transactions Related to the Merger.”

 

Accounting Treatment of the Merger (page 88)

 

Material Federal Income Tax Consequences of the Merger (page 115)

 

Litigation (page 89)

 

Ownership Structure

 

Summary Historical and Unaudited Pro Forma Financial Information of Holdings

		Holdings Consolidated Historical																								Pro Forma
																						Six								Six
																						Months								Months
																						Ended				Year Ended				Ended
		Year Ended December 31,																				June 30,				December 31,				June 30,
		2005(1)				2006				2007				2008				2009				2010				2009				2010
																						(Unaudited)				(Unaudited)				(Unaudited)
		(In thousands, except per unit amounts)
Income Statement Data:
Product sales		$	6,629			$	9,840			$	10,680			$	1,304,097			$	1,125,653			$	1,069,914			$	1,125,653			$	1,069,914
Transportation and other services			401,817				451,920				508,667				592,555				644,719				328,536				644,719				328,536
Total revenues(2)			408,446				461,760				519,347				1,896,652				1,770,372				1,398,450				1,770,372				1,398,450
Cost of product sales and natural gas storage services			6,457				9,637				10,473				1,274,135				1,103,015				1,068,382				1,103,015				1,068,382
Operating expenses			190,293				217,737				245,271				281,965				275,930				135,352				275,930				135,352
Depreciation and amortization			32,408				39,629				40,236				50,834				54,699				29,197				54,699				29,197
Asset impairment expense			—				—				—				—				59,724				—				59,724				—
General and administrative			23,419				29,884				28,014				43,226				41,147				24,089				41,147				24,089
Reorganization expense			—				—				—				—				32,057				—				32,057				—
Operating income(2)			155,869				164,873				195,353				246,492				203,800				141,430				203,800				141,430
Investment income			884				1,410				1,490				1,553				453				240				453				240
Interest and debt expense			(55,366	)			(60,702	)			(51,721	)			(75,410	)			(75,147	)			(43,006	)			(75,239	)			(43,052	)
Earnings from equity investments			5,303				6,219				7,553				7,988				12,531				5,416				12,531				5,416
Net income			106,690				111,800				152,675				180,623				141,637				104,080				141,545				104,034
Less: net income attributable to noncontrolling interests			(99,704	)			(103,066	)			(129,754	)			(154,146	)			(92,043	)			(81,303	)			(4,202	)			(2,511	)
Net income attributable to Holdings(2)		$	6,986			$	8,734			$	22,921			$	26,477			$	49,594			$	22,777			$	137,343			$	101,523
Net income from August 9 to December 31, 2006		$	—			$	2,599			$	—			$	—			$	—			$	—			$	—			$	—
Earnings per limited partner unit:(3)
Basic		$	—			$	0.09			$	0.81			$	0.94			$	1.75			$	0.80			$	1.95			$	1.42
Diluted		$	—			$	0.09			$	0.81			$	0.94			$	1.75			$	0.80			$	1.94			$	1.42

		Holdings Consolidated Historical																								Pro Forma
																						Six								Six
																						Months								Months
																						Ended				Year Ended				Ended
		Year Ended December 31,																				June 30,				December 31,				June 30,
		2005(1)				2006				2007				2008				2009				2010				2009				2010
																						(Unaudited)				(Unaudited)				(Unaudited)
		(In thousands, except per unit amounts)
Adjusted EBITDA:(4)
Net income		$	106,690			$	111,800			$	152,675			$	180,623			$	141,637			$	104,080			$	141,545			$	104,034
Less: Net income attributable to noncontrolling interests			(99,704	)			(103,066	)			(129,754	)			(154,146	)			(92,043	)			(81,303	)			(4,202	)			(2,511	)
Net income attributable to Holdings’ unitholders			6,986				8,734				22,921				26,477				49,594				22,777				137,343				101,523
Interest and debt expense			55,366				60,702				51,721				75,410				75,147				43,006				75,239				43,052
Income tax expense (benefit)			874				596				760				801				(343	)			(662	)			(343	)			(662	)
Depreciation and amortization			32,408				39,629				40,236				50,834				54,699				29,197				54,699				29,197
EBITDA			95,634				109,661				115,638				153,522				179,097				94,318				266,938				173,110
Non-cash deferred lease expense			—				—				—				4,598				4,500				2,117				4,500				2,117
Asset impairment expense			—				—				—				—				59,724				—				59,724				—
Reorganization expense			—				—				—				—				32,057				—				32,057				—
Non-cash unit-based compensation expense			—				329				968				1,912				4,405				3,718				4,405				3,718
Adjusted EBITDA		$	95,634			$	109,990			$	116,606			$	160,032			$	279,783			$	100,153			$	367,624			$	178,945
Balance Sheet Data (at period end):
Total assets(2)		$	2,040,832			$	2,212,585			$	2,354,326			$	3,263,097			$	3,486,571			$	3,343,879				n/a			$	3,343,879
Total debt, including current portion			1,104,660				1,020,449				869,463				1,555,719				1,746,473				1,619,959				n/a				1,633,959
Partners’ Capital			80,442				240,617				238,330				232,060				242,334				240,003				n/a				1,371,339
Noncontrolling interests			711,722				772,525				1,066,143				1,166,774				1,209,960				1,163,827				n/a				18,491
Cash Distribution Data:
Cash distributions declared per unit(5)		$	—			$	0.350			$	1.040			$	1.260			$	1.520			$	0.880			$	3.250			$	1.727
Cash distributions paid per unit(5)		$	—			$	0.125			$	0.980			$	1.215			$	1.440			$	0.840			$	3.180			$	1.693

(1)		Certain amounts for the year ended December 31, 2005 presented in this table as product sales and transportation and other services have been reclassified to conform to the presentation for the years ended December 31, 2006, 2007, 2008 and 2009 and the six months ended June 30, 2010. These reclassifications for 2005 have not been audited.
(2)		Substantial increases in revenue, operating income, net income and total assets for the year ended December 31, 2008 resulted from the acquisitions of Lodi Gas Storage, L.L.C. and Farm & Home Oil Company LLC in the first quarter of 2008.
(3)		Earnings per limited partner unit is presented only for the period since August 9, 2006, the date Holdings became a public company.
(4)		EBITDA, a measure not defined under U.S. generally accepted accounting principles, referred to as GAAP, is defined as net income attributable to Holdings’ unitholders before interest expense, income taxes and depreciation and amortization. EBITDA should not be considered an alternative to net income, operating income, cash flow from operations or any other measure of financial performance presented in accordance with GAAP. The EBITDA measure eliminates the significant level of non-cash depreciation and

		amortization expense that results from the capital-intensive nature of Holdings’ businesses and from intangible assets recognized in business combinations. In addition, EBITDA is unaffected by Holdings’ capital structure due to the elimination of interest expense and income taxes. Adjusted EBITDA, which is also a non-GAAP measure, is defined as EBITDA plus (i) non-cash deferred lease expense, which is the difference between the estimated annual land lease expense for the natural gas storage facility in the Natural Gas Storage segment to be recorded under GAAP and the actual cash to be paid for such annual land lease, and (ii) non-cash unit-based compensation expense. In addition, for the year ended December 31, 2009, the Buckeye NGL impairment expense of $59.7 million and the reorganization expense of $32.1 million have been excluded from Adjusted EBITDA in order to evaluate Holdings’ results of operations on a comparative basis over multiple periods. The EBITDA and Adjusted EBITDA data presented may not be comparable to similarly titled measures at other companies because EBITDA and Adjusted EBITDA exclude some items that affect net income attributable to Holdings’ unitholders, and these items may vary among other companies. Historically, the Partnership’s senior management used Adjusted EBITDA to evaluate consolidated operating performance and the operating performance of the business segments and to allocate resources and capital to the business segments. In addition, the Partnership’s senior management used Adjusted EBITDA as a performance measure to evaluate the viability of proposed projects and to determine overall rates of return on alternative investment opportunities. Adjusted EBITDA is provided in this joint proxy statement/prospectus because the Partnership believes that investors benefit from having access to the same financial measures that the Partnership has historically used. Further, Adjusted EBITDA is provided in this joint proxy statement/prospectus because the Partnership and Holdings believe that this measure is useful to investors because it is one of the bases for comparing its operating performance with that of other companies with similar operations, although its measures may not be directly comparable to similar measures used by other companies. Given the nature of the transactions the merger agreement contemplates, the Partnership and Holdings believe investors benefit from having Adjusted EBITDA for partnership comparison purposes.
(5)		Cash distributions declared represent distributions declared associated with each calendar year. Distributions are generally declared and paid within 60 days following the close of each quarter. Cash distributions paid represent cash payments for distributions during each of the periods presented. Cash distributions declared/paid reflect the distribution decisions made by the Holdings Board and the Partnership Board at their respective quarterly board meetings. As such, these pro forma calculations are not necessarily indicative of the distribution decision that the Holdings Board or the Partnership Board would have made had the merger been completed at January 1, 2009 or January 1, 2010. For comparison to the historical Holdings per unit data, the pro forma data should be multiplied by the 0.705 conversion ratio.

 

Selected Historical Financial Information of the Partnership

		The Partnership Consolidated Historical
																						Six Months
																						Ended
		Year Ended December 31,																				June 30,
		2005(1)				2006				2007				2008				2009				2010
																						(Unaudited)
		(In thousands, except per unit amounts)
Income Statement Data:
Product sales		$	6,629			$	9,840			$	10,680			$	1,304,097			$	1,125,653			$	1,069,914
Transportation and other services			401,817				451,920				508,667				592,555				644,719				328,536
Total revenues(2)			408,446				461,760				519,347				1,896,652				1,770,372				1,398,450
Cost of product sales and natural gas storage services			6,457				9,637				10,473				1,274,135				1,103,015				1,068,382
Operating expenses			185,628				211,801				240,258				279,454				273,985				133,269
Depreciation and amortization			36,760				44,039				44,651				55,299				59,164				31,430
Asset impairment expense			—				—				—				—				59,724				—
General and administrative			18,288				19,216				21,885				34,143				33,984				20,510
Reorganization expense			—				—				—				—				32,057				—
Operating income(2)			161,313				177,067				202,080				253,621				208,443				144,859
Other income			637				1,944				1,362				1,429				777				239
Interest and debt expense			(43,357	)			(52,113	)			(50,378	)			(74,387	)			(74,851	)			(42,811	)
General partner incentive compensation			(20,180	)			(18,277	)			—				—				—				—
Earnings from equity investments			5,303				6,219				7,553				7,988				12,531				5,416
Income from continuing operations			103,716				114,840				160,617				188,651				146,900				107,703
Income from discontinued operations			—				—				—				1,230				—				—
Net income(2)			103,716				114,840				160,617				189,881				146,900				107,703
Less: net income attributable to noncontrolling interests			(3,758	)			(4,600	)			(5,261	)			(5,492	)			(5,918	)			(3,583	)
Net income attributable to the Partnership		$	99,958			$	110,240			$	155,356			$	184,389			$	140,982			$	104,120
Earnings per LP unit:
Basic		$	2.12			$	2.14			$	2.91			$	3.00			$	1.84			$	1.52
Diluted		$	2.12			$	2.14			$	2.91			$	3.00			$	1.84			$	1.51

		The Partnership Consolidated Historical
																						Six Months
																						Ended
		Year Ended December 31,																				June 30,
		2005(1)				2006				2007				2008				2009				2010
																						(Unaudited)
		(In thousands, except per unit amounts)
Adjusted EBITDA:(3)
Net income		$	103,716			$	114,840			$	160,617			$	189,881			$	146,900			$	107,703
Less: Net income attributable to noncontrolling interests			(3,758	)			(4,600	)			(5,261	)			(5,492	)			(5,918	)			(3,583	)
Less: Income from discontinued operations			—				—				—				(1,230	)			—				—
Net income attributable to the Partnership’s unitholders from continuing operations			99,958				110,240				155,356				183,159				140,982				104,120
Interest and debt expense			43,357				52,113				50,378				74,387				74,851				42,811
Income tax expense (benefit)			866				595				763				796				(348	)			(665	)
Depreciation and amortization			36,760				44,039				44,651				55,299				59,164				31,430
EBITDA			180,941				206,987				251,148				313,641				274,649				177,696
General partner incentive compensation			20,180				18,277				—				—				—				—
Non-cash deferred lease expense			—				—				—				4,598				4,500				2,117
Asset impairment expense			—				—				—				—				59,724				—
Reorganization expense			—				—				—				—				32,057				—
Non-cash unit-based compensation expense			—				329				378				486				3,079				2,794
Adjusted EBITDA		$	201,121			$	225,593			$	251,526			$	318,725			$	374,009			$	182,607
Balance Sheet Data (at period end):
Total assets(2)		$	1,816,867			$	1,995,470			$	2,133,652			$	3,034,410			$	3,255,649			$	3,110,335
Long-term debt			899,077				994,127				849,177				1,445,722				1,498,970				1,421,181
General Partner’s capital (deficit)			2,529				1,964				(1,005	)			(6,680	)			1,849				1,762
Limited Partners’ capital			756,531				807,488				1,100,346				1,201,144				1,214,136				1,199,649
Accumulated other comprehensive income (loss)			—				785				(9,169	)			(18,967	)			(847	)			(37,533	)
Noncontrolling interests			19,516				20,169				21,468				20,775				20,957				22,037
Cash Distribution Data:
Cash distributions declared per LP unit(4)		$	2.8750			$	3.0750			$	3.2750			$	3.4750			$	3.6750			$	1.9125
Cash distributions paid per LP unit(4)		$	2.8250			$	3.0250			$	3.2250			$	3.4250			$	3.6250			$	1.8875

(1)		Certain amounts for the year ended December 31, 2005 presented in this table as product sales and transportation and other services have been reclassified to conform to the presentation for the years ended December 31, 2006, 2007, 2008 and 2009 and the six months ended June 30, 2010. These reclassifications for 2005 have not been audited.
(2)		Substantial increases in revenue, operating income, net income and total assets for the year ended December 31, 2008 resulted from the acquisitions of Lodi Gas Storage, L.L.C. and Farm & Home Oil Company LLC in the first quarter of 2008.
(3)		EBITDA, a measure not defined under GAAP, is defined as net income attributable to the Partnership’s unitholders from continuing operations before interest expense, income taxes and depreciation and

		amortization. EBITDA should not be considered an alternative to net income, operating income, cash flow from operations or any other measure of financial performance presented in accordance with GAAP. The EBITDA measure eliminates the significant level of non-cash depreciation and amortization expense that results from the capital-intensive nature of the Partnership’s businesses and from intangible assets recognized in business combinations. In addition, EBITDA is unaffected by the Partnership’s capital structure due to the elimination of interest expense and income taxes. The Partnership defines Adjusted EBITDA, which is also a non-GAAP measure, as EBITDA plus (i) general partner incentive compensation, (ii) non-cash deferred lease expense, which is the difference between the estimated annual land lease expense for the Partnership’s natural gas storage facility in the Natural Gas Storage segment to be recorded under GAAP and the actual cash to be paid for such annual land lease, and (iii) non-cash unit-based compensation expense. In addition, for the year ended December 31, 2009, the Partnership has excluded the Buckeye NGL impairment expense of $59.7 million and the reorganization expense of $32.1 million from Adjusted EBITDA in order to evaluate its results of operations on a comparative basis over multiple periods. The EBITDA and Adjusted EBITDA data presented may not be comparable to similarly titled measures at other companies because EBITDA and Adjusted EBITDA exclude some items that affect net income attributable to the Partnership’s unitholders, and these items may vary among other companies. The Partnership’s senior management uses Adjusted EBITDA to evaluate consolidated operating performance and the operating performance of the business segments and to allocate resources and capital to the business segments. In addition, the Partnership’s senior management uses Adjusted EBITDA as a performance measure to evaluate the viability of proposed projects and to determine overall rates of return on alternative investment opportunities. The Partnership believes that investors benefit from having access to the same financial measures that it uses. Further, the Partnership believes that these measures are useful to investors because they are one of the bases for comparing its operating performance with that of other companies with similar operations, although its measures may not be directly comparable to similar measures used by other companies.
(4)		Cash distributions declared represent distributions declared associated with each calendar year. Distributions are generally declared and paid within 60 days following the close of each quarter. Cash distributions paid represent cash payments for distributions during each of the periods presented.

 

The following table sets forth certain historical per unit information of the Partnership and Holdings and the unaudited pro forma combined per unit information after giving pro forma effect to the merger, and the Partnership’s issuance of 0.705 Partnership LP units for each outstanding Holdings unit.

 

You should read this information in conjunction with the summary historical financial information included elsewhere in this joint proxy statement/prospectus and the historical consolidated financial statements of Holdings and the Partnership and related notes that are incorporated by reference in this joint proxy statement/prospectus and in conjunction with the Unaudited Pro Forma Condensed Consolidated Financial Statements and related notes included elsewhere in this joint proxy statement/prospectus. The unaudited pro forma combined per unit information does not purport to represent what the actual results of operations of Holdings and the Partnership would have been had the partnerships been combined or to project Holdings and the Partnership’s results of operations that may be achieved after the merger is completed.

 

 

 

 

The Partnership LP units are traded on the New York Stock Exchange under the symbol “BPL,” and the Holdings common units are traded on the New York Stock Exchange under the symbol “BGH.” The Holdings management units are not publicly traded. The following table sets forth, for the periods indicated, the range of high and low sales prices per unit for the Partnership LP units and the Holdings common units, as well as information concerning quarterly cash distributions for the Partnership LP units and Holdings common units. The sales prices are as reported in published financial sources.