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Partners' Capital, Mezzanine Capital and Distributions | 6 Months Ended
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Jun. 30, 2020
Equity [Abstract] |
Partners' Capital, Mezzanine Capital and Distributions | Partners’ Capital, Mezzanine Capital and Distributions At June 30, 2020, our outstanding common units consisted of 122,539,221 Class A units and 39,997 Class B units. Distributions We paid or will pay the following distributions to our common unitholders in 2019 and 2020:
Distribution For |  | Date Paid |  | Per Unit Amount |  | Total Amount |
2019 |  |  |  |  |  |  |
1st Quarter |  | May 15, 2019 |  | $ | 0.5500 |  |  | $ | 67,419 |  |
2nd Quarter |  | August 14, 2019 |  | $ | 0.5500 |  |  | $ | 67,419 |  |
3rd Quarter |  | November 14, 2019 |  | $ | 0.5500 |  |  | $ | 67,419 |  |
4th Quarter |  | February 14, 2020 |  | $ | 0.5500 |  |  | $ | 67,419 |  |
2020 |  |  |  |  |  |  |
1st Quarter |  | May 15, 2020 |  | $ | 0.1500 |  |  | $ | 18,387 |  |
2nd Quarter |  | August 14, 2020 | (1) | $ | 0.1500 |  |  | $ | 18,387 |  |
(1) This distribution was declared on July 8, 2020 and will be paid to unitholders of record as of July 31, 2020. Class A Convertible Preferred Units At June 30, 2020 we had 25,336,778 Class A Convertible Preferred Units (our "Class A Convertible Preferred Units") outstanding. Our Class A Convertible Preferred Units rank senior to all of our currently outstanding classes or series of limited partner interests with respect to distribution and/or liquidation rights. Holders of our Class A Convertible Preferred Units vote on an as-converted basis with holders of our common units and have certain class voting rights, including with respect to any amendment to the partnership agreement that would adversely affect the rights, preferences or privileges, or otherwise modify the terms, of those Class A Convertible Preferred Units. Accounting for the Class A Convertible Preferred Units Our Class A Convertible Preferred Units are considered redeemable securities under GAAP due to the existence of redemption provisions upon a deemed liquidation event that is outside our control. Therefore, we present them as temporary equity in the mezzanine section of the Unaudited Condensed Consolidated Balance Sheets. Because our Class A Convertible Preferred Units are not currently redeemable and we do not have plans or expect any events that constitute a change of control in our partnership agreement, we present our Class A Convertible Preferred Units at their initial carrying amount. However, we would be required to adjust that carrying amount if it becomes probable that we would be required to redeem our Class A Convertible Preferred Units. Initial and Subsequent Measurement We initially recognized our Class A Convertible Preferred Units at their issuance date fair value, net of issuance costs. We will not be required to adjust the carrying amount of our Class A Convertible Preferred Units until it becomes probable that they would become redeemable. Once redemption becomes probable, we would adjust the carrying amount of our Class A Convertible Preferred Units to the redemption value over a period of time comprising the date the feature first becomes probable and the date the units can first be redeemed. Our Class A Convertible Preferred Units contain a distribution Rate Reset Election (as defined in Note 15) option. This Rate Reset Election is bifurcated and accounted for separately as an embedded derivative and recorded at fair value at each reporting period. Refer to Note 15 and Note 16 for additional discussion. Class A Convertible Preferred Unit distributions are recognized on the date in which they are declared. Paid-in-kind ("PIK") distributions were declared and issued as follows:
Distribution For |  | Date Issued |  | Number of Units (1) |  | Total Amount
2019 |  |  |  |  |  |
1st Quarter |  | May 15, 2019 |  | 364,180 |  |  | $ | 12,277 |
(1) Subsequent to the first quarter of 2019, all distributions have b een and w ill be paid in cash. Net Income (Loss) Attributable to Genesis Energy, L.P. is reduced by Class A Convertible Preferred Unit distributions that accumulated during the period. Net income (loss) attributable to Genesis Energy, L.P. was reduced by $18.7 million and $37.4 million for the three and six months ended June 30, 2020, and $18.7 million and $37.1 million for the three and six months ended June 30, 2019. We paid or will pay the following cash distributions to our Class A Convertible Preferred unitholders in 2019 and 2020:
Distribution For |  | Date Paid |  | Per Unit Amount |  | Total Amount
2019 |  |  |  |  |  |
1st Quarter |  | May 15, 2019 |  | $ | 0.2458 |  |  | $ | 6,138 |
2nd Quarter |  | August 14, 2019 |  | $ | 0.7374 |  |  | $ | 18,684 |
3rd Quarter |  | November 14, 2019 |  | $ | 0.7374 |  |  | $ | 18,684 |
4th Quarter |  | February 14, 2020 |  | $ | 0.7374 |  |  | $ | 18,684 |
2020 |  |  |  |  |  |
1st Quarter |  | May 15, 2020 |  | $ | 0.7374 |  |  | $ | 18,684 |
2nd Quarter |  | August 14, 2020 | (1) | $ | 0.7374 |  |  | $ | 18,684 |
(1) This distribution was declared on July 8, 2020 and will be paid to unitholders of record as of July 31, 2020. Redeemable Noncontrolling Interests On September 23, 2019, we, through a subsidiary, Alkali Holdings, entered into an amended and restated Limited Liability Company Agreement of Alkali Holdings (the "LLC Agreement") and a Securities Purchase Agreement (the "Securities Purchase Agreement") whereby certain investment fund entities affiliated with GSO Capital Partners LP (collectively "GSO") purchased $55,000,000 (or 55,000 Alkali preferred units) and committed to purchase up to $350,000,000 of preferred units in Alkali Holdings, the entity that holds our trona and trona-based exploring, mining, processing, producing, marketing and selling business, including its Granger facility near Green River, Wyoming. Alkali Holdings will use the net proceeds from the Alkali Holdings preferred units to fund up to 100% of the anticipated cost of expansion of the Granger facility. On April 14, 2020, we entered into an amendment to our agreements with GSO to, among other things, extend the construction timeline of the Granger expansion project by one year. In consideration for the amendment, we issued 1,750 Alkali preferred units to GSO, which was accounted for as issuance costs. As of June 30, 2020, we have received cash of $122.9 million for the 131,750 Alkali Holdings preferred units issued to date net of issuance costs, which is inclusive of our transaction related expenses and one-time commitment fee. Accounting for Redeemable Noncontrolling Interests Classification The Alkali Holdings preferred units issued and outstanding are accounted for as a redeemable noncontrolling interest in the mezzanine section on our Unaudited Condensed Consolidated Balance Sheets due to the redemption features for a change of control. Initial and Subsequent Measurement We recorded the Alkali Holdings preferred units at their issuance date fair value, net of issuance costs. The fair value as of June 30, 2020 represents the carrying amount based on the issued and outstanding Alkali Holdings preferred units most probable redemption event on the six and a half year anniversary of the closing, which is the predetermined internal rate of return measure accreted using the effective interest method to the redemption value as of the reporting date. Net Income (Loss) Attributable to Genesis Energy, L.P. for the three months ended June 30, 2020 includes $4.2 million of adjustments, of which $3.4 million was allocated to the PIK distributions on the outstanding Alkali Holdings preferred units and $0.8 million was attributable to redemption accretion value adjustments. Additionally, Net Income (Loss) Attributable to Genesis Energy, L.P. for the six months ended June 30, 2020 includes $8.2 million of adjustments, of which $6.7 million was allocated to the PIK distributions and $1.5 million was attributable to redemption accretion value adjustments. We elected to pay distributions for the period ended June 30, 2020 in-kind to our Alkali Holdings preferred unitholders. These PIK distributions increase the unitholders liquidation preference on each Alkali Holdings preferred unit. As of the reporting date, there are no triggering, change of control, early redemption or monetization events that are probable that would require us to revalue the Alkali Holdings preferred units. If the Alkali Holdings preferred units were redeemed on the reporting date of June 30, 2020, the redemption amount would be equal to $194.7 million, which would be the multiple of invested capital metric applied to the Alkali Holdings preferred units outstanding plus the make-whole amount on the undrawn minimum Alkali Holdings preferred units. The following table shows the change in our redeemable noncontrolling interest balance from December 31, 2019 to June 30, 2020:
Balance as of December 31, 2019 |  | $ | 125,133 |
PIK distributions |  | 6,708 |
Redemption accretion |  | 1,537 |
Balance as of June 30, 2020 |  | $ | 133,378 |

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- Definition The entire disclosure for the formation, structure, control and ownership of the partnership. Disclosures related to accounts comprising partners' capital. Includes balances of general partners' capital account, limited partners' capital account, preferred partners' capital account and total partners' capital account and units outstanding; accumulated other comprehensive income; amount and nature of changes to amount of partner's capital and units outstanding by class, rights and privileges for each class of units; distribution policies and distributions paid by unit class; impact of and correction of an error in previously issued financial statements; limitations of partners' liability; redemption, conversion and distribution policies; and deferred compensation related to the issuance of units. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
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