USD PARTNERS LP: completion of acquisition or disposal of assets, unregistered sale of equity securities, amendments to articles of association or regulations; Fiscal Year Change, FD Regulation Disclosure, Financial Statements and Exhibits (Form 8-K)

Item 2.01 Completion of Acquisition or Disposal of Assets.

On April 6, 2022, USD Partners LP (the “Company”) and certain of its subsidiaries (together with the Partnership, the “Acquiring Entities”) have completed the previously announced acquisition of interests in certain subsidiaries of USD Group LLC (“USD Group“) who hold 100% of the Hardisty South Terminal (the Acquisition”). Concurrently with the closing of the Acquisition, the Partnership and USD Partners GP LLCthe General Partner of the Partnership (the “General Partner”), has effected (i) the cancellation of the Partnership Incentive Distribution Rights (“IDR”) held by the General Partner, and (ii) the conversion of the General Partner’s approximate 1.6% ownership interest % economic general partner interest in the Partnership to non-economic general partner interest in the Partnership (the “GP/IDR Restructuring” and, together with the Acquisition, the “Transactions “).

The Transactions were completed pursuant to a Contribution Agreement, dated
March 27, 2022 (the “Contribution Agreement”), by and between the Acquiring Entities, and USD Group and certain subsidiaries of USD Group (“Contributing Parties”). Subject to the terms and conditions of the Contribution Agreement, concurrently with the closing of the Transactions, the General Partner amended and restated the Second Amended and Restated Limited Partnership Agreement of the Limited Partnership, dated October 15, 2014 to reflect the GP/IDR Restructuring (the “Third Amended and Restated Partnership Agreement”). The total consideration for the Transactions was $75 million in cash, plus 5,751,136 newly issued Common Units representing the interests of Limited Partners in the Partnership (the “Common Units”), which were issued to USD Group.

At the close of the transactions, the Partnership has 33,371,045 Common Units outstanding, of which USD Group holds 17,308,226 Common Units in the Partnership representing an aggregate limited partnership interest of 51.9%. The terms of the Transactions, the Contribution Agreement and the Third Amended and Restated Partnership Agreement have been approved by the board of directors of the General Partner (the “Board”), based on the approval and recommendation of the of the Board’s conflicts, which is composed entirely of independent directors. The Conflicts Committee has engaged an independent financial advisor and legal advisor.

The foregoing description of the Contribution Agreement is qualified in its entirety by reference to the full text of the Contribution Agreement, which was filed as Exhibit 10.1 to the Partnership’s Current Report on Form 8- K filed on
March 29, 2022 and is incorporated herein by reference.

In connection with the closing of the transactions, the Partnership entered into an amendment to its Amended and Restated Credit Agreement to permit the Partnership to acquire the Netherlands cooperative which is the parent company of the company owning the Hardisty South Terminal. The foregoing description is not complete and is qualified in its entirety by reference to the full text of the Amended and Restated Credit Agreement Amendment, a copy of which is filed as Exhibit 10.1 to this Current Report. on Form 8-K and is incorporated herein by reference.

Item 3.02 Unrecorded Sales of Equity securities.

The description in Section 2.01 above of the issuance of Ordinary Units by the Partnership pursuant to the Transactions is incorporated into this Section 3.02 by reference to the extent such information relates to the sale of securities of unregistered participation. The sale and issue of the Partnership’s Common Units in the Transactions are exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) .

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Item 5.03 Amendments to Articles of Incorporation or Bylaws; Tax change

Year.

In connection with the closing of the transactions, the General Partner has entered into the Third Amended and Restated Partnership Agreement, dated April 6, 2022. Among other things, the Third Amended and Restated Partnership Agreement provides for (i) the cancellation of the IDRs, (ii) the conversion of the general partner’s 1.6% economic interest in the partnership to a non-economic interest of the general partner, and (iii) the deletion of certain inherited provisions which no longer apply, in particular the provisions relating to IDRs, economic general partner and subordinated units.

The disclosure contained in this Section 5.03 does not purport to be a complete description of the Third Amended and Restated Partnership Agreement and is qualified in its entirety by reference to the full text of the Third Amended and Restated Partnership Agreement, which is filed as Exhibit 3.1 herein and is incorporated by reference into this Section 5.03.

Section 7.01 Disclosure of FD Rules.

On April 6, 2022, the Partnership has issued a press release announcing the completion of the Contribution Agreement. A copy of the press release is attached as Exhibit 99.1 hereto and is incorporated herein by reference.

Information provided in this Section 7.01 (including exhibits referenced herein) shall be deemed “provided” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended ( the Exchange Act), nor shall they be incorporated by reference in any filing made by the Partnership under the Securities Act, except to the extent that such filing incorporates by reference any or all such information. by express reference thereto.

Item 9.01 Financial statements and supporting documents.

(d) Exhibits

Exhibit
Number                                    Description

 3.1           Third Amended and Restated Agreement of Limited Partnership of USD
             Partners LP, dated as of April 6, 2022.

10.1           Amendment No. 2 to Amended and Restated Credit Agreement, dated as
             of April 6, 2022, among USD Partners LP, USD Terminals Canada ULC, the
             Guarantors party thereto, Bank of Montreal, as Administrative Agent,
             and the other financial institutions party thereto executing the
             Amendment as Lenders.

99.1           Press Release dated April 6, 2022, issued by USD Partners LP.

104          The cover page from this Current Report on Form 8-K, formatted in
             Inline XBRL.

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