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Partners' Capital, Mezzanine Capital and Distributions | 9 Months Ended
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Sep. 30, 2021
Equity [Abstract] |
Partners' Capital, Mezzanine Capital and Distributions | Partners’ Capital, Mezzanine Capital and Distributions At September 30, 2021, 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 2020 and 2021:
Distribution For |  | Date Paid |  | Per Unit Amount |  | Total Amount |
2020 |  |  |  |  |  |  |
1 st Quarter |  | May 15, 2020 |  | $ | 0.15 |  |  | $ | 18,387 |  |
2 nd Quarter |  | August 14, 2020 |  | $ | 0.15 |  |  | $ | 18,387 |  |
3 rd Quarter |  | November 13, 2020 |  | $ | 0.15 |  |  | $ | 18,387 |  |
4 th Quarter |  | February 12, 2021 |  | $ | 0.15 |  |  | $ | 18,387 |  |
2021 |  |  |  |  |  |  |
1 st Quarter |  | May 14, 2021 |  | $ | 0.15 |  |  | $ | 18,387 |  |
2 nd Quarter |  | August 13, 2021 |  | $ | 0.15 |  |  | $ | 18,387 |  |
3 rd Quarter |  | November 12, 2021 | (1) | $ | 0.15 |  |  | $ | 18,387 |  |
(1) This distribution was declared on October 5, 2021 and will be paid to unitholders of record as of October 29, 2021. Class A Convertible Preferred Units At September 30, 2021 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). 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. Net Loss Attributable to Genesis Energy, L.P. is reduced by Class A Convertible Preferred Unit distributions that accumulated during the period. Net Loss Attributable to Genesis Energy, L.P. was reduced by $18.7 million and $56.1 million for the three and nine months ended September 30, 2021 and 2020. We paid or will pay the following cash distributions to our Class A Convertible Preferred unitholders in 2020 and 2021:
Distribution For |  | Date Paid |  | Per Unit Amount |  | Total Amount
2020 |  |  |  |  |  |
1 st Quarter |  | May 15, 2020 |  | $ | 0.7374 |  |  | $ | 18,684 |
2 nd Quarter |  | August 14, 2020 |  | $ | 0.7374 |  |  | $ | 18,684 |
3 rd Quarter |  | November 13, 2020 |  | $ | 0.7374 |  |  | $ | 18,684 |
4 th Quarter |  | February 12, 2021 |  | $ | 0.7374 |  |  | $ | 18,684 |
2021 |  |  |  |  |  |
1 st Quarter |  | May 14, 2021 |  | $ | 0.7374 |  |  | $ | 18,684 |
2 nd Quarter |  | August 13, 2021 |  | $ | 0.7374 |  |  | $ | 18,684 |
3 rd Quarter |  | November 12, 2021 | (1) | $ | 0.7374 |  |  | $ | 18,684 |
(1) This distribution was declared on October 5, 2021 and will be paid to unitholders of record as of October 29, 2021. 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 Blackstone Alternative Credit Advisors LP, formerly known as "GSO Capital Partners LP" (collectively "BXC") purchased $55,000,000 (or 55,000 Alkali Holdings 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 (the "Granger Optimization Project" or "GOP"). BXC is obligated to purchase a minimum of $250,000,000 of preferred units of Alkali Holdings ("Minimum Alkali Holdings Preferred Units") unless certain customary closing conditions are not satisfied. On April 14, 2020, we entered into an amendment to our agreements with BXC to, among other things, extend the construction timeline of the GOP by one year, which we currently anticipate completing in the second half of 2023. In consideration for the amendment, we issued 1,750 Alkali Holdings preferred units to BXC, which was accounted for as issuance costs. As part of the amendment, the commitment period was increased to four years, and the total commitment of BXC was increased to, subject to compliance with the covenants contained in the agreements with BXC, up to $351,750,000 preferred units (or 351,750 preferred units) in Alkali Holdings and the Minimum Alkali Holdings Preferred Units was increased up to $251,750,000. As of September 30, 2021, there are 246,394 Alkali Holdings preferred units outstanding. 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 September 30, 2021 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 Loss Attributable to Genesis Energy, L.P. for the three months ended September 30, 2021 includes $7.1 million of adjustments, of which $5.9 million was allocated to the paid-in-kind ("PIK") distributions on the outstanding Alkali Holdings preferred units and $1.2 million was attributable to redemption accretion value adjustments. Net Loss Attributable to Genesis Energy, L.P. for the nine months ended September 30, 2021 includes $17.7 million of adjustments, of which $14.9 million was allocated to the PIK distributions on the outstanding Alkali Holdings preferred units and $2.8 million was attributable to redemption accretion value adjustments. Net Loss Attributable to Genesis Energy, L.P. for the three months ended September 30, 2020 includes $4.2 million of adjustments, of which $3.5 million was allocated to the PIK distributions and $0.7 million was attributable to redemption accretion value adjustments. Net Loss Attributable to Genesis Energy, L.P. for the nine months ended September 30, 2020 includes $12.4 million of adjustments, of which $10.2 million was allocated to the PIK distributions and $2.2 million was attributable to redemption accretion value adjustments. We elected to pay distributions for the period ended September 30, 2021 in-kind to our Alkali Holdings preferred unitholders. The unitholders liquidation preference is increased by new issuances and PIK distributions and is reduced by tax distributions paid to the unitholders, which are required to be paid by us to fulfill the income tax liabilities of each holder of Alkali Holdings preferred units. 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 September 30, 2021, the redemption amount would be equal to $289.9 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, 2020 to September 30, 2021:
Balance as of December 31, 2020 |  | $ | 141,194 |
Issuance of preferred units, net of issuance costs (1) |  | 103,042 |
PIK distribution |  | 14,856 |
Redemption accretion |  | 2,783 |
Tax distributions (1) |  | (10,064) |
Balance as of September 30, 2021 |  | $ | 251,811 |
(1) During the period ended September 30, 2021, we issued 10,145 Alkali Holdings preferred units to BXC to satisfy the company's obligation to pay tax distributions. Additionally, we issued 95,000 Alkali Holdings preferred units to BXC during the nine months ended September 30, 2021 to continue to fund the GOP.

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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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