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Share Name | Share Symbol | Market | Type |
---|---|---|---|
CorEnergy Infrastructure Trust Inc NEW | NYSE:CORR | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.45 | 0 | 01:00:00 |
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Maryland
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20-3431375
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(State or other jurisdiction of incorporation or organization)
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(IRS Employer Identification No.)
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1100 Walnut, Ste. 3350
Kansas City, MO
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64106
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(Address of Principal Executive Offices)
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(Zip Code)
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(816) 875-3705
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(Registrant's telephone number, including area code)
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Large accelerated filer
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o
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Accelerated filer
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x
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Non-accelerated filer
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o
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Smaller reporting company
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x
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Emerging growth company
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o
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GLOSSARY OF DEFINED TERMS
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GLOSSARY OF DEFINED TERMS (Continued from previous page)
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GLOSSARY OF DEFINED TERMS (Continued from previous page)
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•
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On January 16, 2019, we exchanged $43.8 million face amount of our 7.00% Convertible Notes for an aggregate of 837,040 shares of our common stock plus aggregate cash consideration of $19.8 million.
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•
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On August 12, 2019, we completed a private placement offering of $120.0 million aggregate principal amount of 5.875% Convertible Notes. On August 15, 2019, we used a portion of the net proceeds from the offering, together with shares of our common stock, to exchange $63.9 million face amount of our 7.00% Convertible Notes. The total cash and stock consideration for the exchange was valued at approximately $93.2 million. This included an aggregate of 703,432 shares of common stock plus cash consideration of approximately $60.2 million.
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•
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On August 22, 2019, the FERC approved the settlement of the MoGas rate case filed in May of 2018. The FERC order provides annual rates of approximately $14.8 million. The settlement became effective September 1, 2019, with the new rates retroactively effective December 1, 2018. In conjunction with the settlement, MoGas entered into 5-year firm transportation service agreements with its customers in exchange for modest discounts.
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•
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During 2019, we received participating rent of $4.6 million on the Pinedale Lease Agreement based on the volumes of condensate and water that flowed through the Pinedale LGS.
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•
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During 2019, we began considering investment structures and opportunities that became available to us as a result of the PLR from the IRS which, among other things, qualifies use fees for storage and pipeline capacity and oil platforms as representing REIT-qualifying rents from real property.
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•
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Grand Isle Gathering System: a subsea, midstream 137-mile pipeline system located in the Gulf of Mexico and a 16-acre onshore terminal facility triple-net leased on a long-term basis to a subsidiary of EGC, pursuant to the Grand Isle Lease Agreement. The EGC Tenant's obligations under the lease agreement are guaranteed by EGC.
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•
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Pinedale LGS: a system consisting of approximately 150 miles of pipelines and four above-ground central gathering facilities located in the Pinedale Anticline in Wyoming triple-net leased on a long-term basis to a subsidiary of, and guaranteed by, Ultra Petroleum Corp. and Ultra Resources, Inc. pursuant to the Pinedale Lease Agreement.
|
•
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MoGas Pipeline System: MoGas is the owner and operator of the MoGas Pipeline System, an approximately 263-mile FERC-regulated interstate natural gas pipeline in and around St. Louis and extending into central Missouri.
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•
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Omega Pipeline: Omega Pipeline Company, LLC is a natural gas service provider located primarily on the US Army's Fort Leonard Wood military post in south-central Missouri.
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•
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Tenant/Borrower/Counterparty Evaluation – We evaluate each potential tenant, borrower or counterparty for its creditworthiness, typically considering factors such as management experience, industry position and fundamentals, operating history, and capital structure, as well as other factors that may be relevant to a particular acquisition. We seek opportunities in which we believe the tenant may have a stable or improving credit profile or credit potential that has not been recognized by the market. In evaluating a possible investment, the creditworthiness of a tenant, borrower or counterparty often will be balanced with the value of the underlying real estate, particularly if the underlying property is specifically suited to the needs of the tenant. Whether a prospective tenant, borrower or counterparty is creditworthy will be determined by our management team and reviewed by the investment committee, as described below. Creditworthy does not necessarily mean "investment grade."
|
•
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Importance to Tenant/Borrower/Counterparty Operations – We will predominately focus on properties that we believe are essential or important to the ongoing operations of the tenant, borrower or counterparty and/or for the economic production of hydrocarbon resources, which would remain necessary to any owner of the assets. We believe that this type of property will provide a relatively low risk of loss in the case of a potential bankruptcy or abandonment scenario since a tenant/borrower/counterparty is less likely to risk the loss of a critically important lease or property.
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•
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Diversification – We attempt to diversify our portfolio to avoid dependence on any one particular tenant, borrower, counterparty, collateral type, and geographic location within the U.S. or tenant/borrower/counterparty industry. By diversifying, we seek to reduce the adverse effect of a single under-performing investment or a downturn in any particular asset or geographic region within the U.S.
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•
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Lease Terms – Typically, the net leased properties we will acquire will be leased on a full recourse basis to the tenants or their affiliates. In addition, we often seek to include a clause in each lease that provides for increases in rent over the term of the lease. These increases are fixed or tied to increases in indices such as the CPI. In many cases the lease will also seek to provide for participation in gross revenues of the tenant at the property, thereby providing exposure to the successful commercial activity of the tenant through features such as participating rent. Alternatively, a lease may provide for mandated rental increases on specific dates, and we may adopt other methods in the future.
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•
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Asset Evaluation – We review the physical condition of the property and assess the likelihood of replacing the rental payment stream if the tenant defaults. We also engage a third party to conduct, or require the seller to conduct, a preliminary examination, or Phase 1 assessment, of the site to determine the potential for contamination or similar environmental site assessments in an attempt to identify potential environmental liabilities associated with a property prior to its acquisition.
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•
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Transaction Provisions to Enhance and Protect Value – We attempt to include provisions in the leases that we believe may help protect a real property asset from changes in the operating and financial characteristics of a tenant that may affect its ability to satisfy its obligations or reduce the value of the real property asset. Such provisions include requiring our consent to specified tenant activity, requiring the tenant to provide indemnification protections, and requiring the tenant to utilize good operating practices consistent with objective criteria. We seek to enhance the likelihood of a tenant's lease obligations being satisfied through a guaranty of obligations from the tenant's corporate parent or other entity or a letter of credit. In some circumstances, we may provide tenants with repurchase options on the leased property. We expect, in those situations that the option purchase price will generally be the greater of the contract purchase price or the fair market value of the property at the time the option is exercised.
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•
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Equity Enhancements – We may attempt to obtain equity enhancements in connection with transactions. These equity enhancements may involve warrants exercisable at a future time to purchase stock of the tenant or borrower or their parent. If warrants are obtained, and become exercisable, and if the value of the stock subsequently exceeds the exercise price of the warrant, equity enhancements can help achieve the goal of increasing investor returns.
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•
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Other Real Estate Related Assets – As other opportunities arise, we may also seek to expand the portfolio to include other types of real estate-related investments, in all cases within the energy infrastructure sector, such as:
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•
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equity investments in real properties that are not long-term net leased to a single-tenant and may include partially leased properties, undeveloped properties and properties subject to short-term net leases, among others;
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•
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mortgage loans secured by real properties including loans to our taxable REIT subsidiaries;
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•
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subordinated interests in first mortgage real estate loans, or B-notes;
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•
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mezzanine loans related to real estate, which are senior to the borrower's equity position but subordinated to other third-party financing;
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•
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other energy infrastructure assets that we may acquire and operate as provided in the PLR; and
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•
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equity and debt securities (including preferred equity, limited partnership interests, trusts and other higher-yielding structured debt and equity investments) issued by companies that are engaged in real-estate-related businesses as defined by regulations promulgated under the Code, including other REITs.
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•
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we may be unable to acquire a desired asset because of competition from other investors with significant capital, including both publicly traded and non-traded REITs and institutional investment funds;
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•
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competition from other investors may significantly increase the purchase price of a desired real property asset or result in less favorable terms;
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•
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we may not complete the acquisition of a desired real property asset even if we have signed an agreement to acquire such real property asset because such agreements are subject to customary conditions to closing, including completion of due diligence investigations to our satisfaction; and
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•
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we may be unable to finance acquisitions of real property assets on favorable terms or at all.
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•
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A sale-leaseback transaction may be re-characterized by a bankruptcy court as either a disguised financing transaction or a functional joint venture. If the sale-leaseback were re-characterized as a financing transaction, we might not be considered the owner of the subject property and, as a result, we should have the status of a secured creditor of the lessee company with regard to the subject property, assuming the securitization measures we take as described below are respected by the bankruptcy court. In that event, we would no longer have the right to sell or encumber our ownership interest in the property. Instead, we would have a claim against the lessee company for the amounts owed under the lease. Although we believe each of our lease agreements constitutes a true lease that should not be subject to recharacterization, there is no guaranty
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•
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A lessee could either assume, assign or reject a lease in a bankruptcy case. The bankrupt lessee is required to make rent payments to us during its bankruptcy until it rejects the commercial real property lease (for leases that are personal property leases, the lessee need not make rental payments that arise from the petition date until 60 days after the order for relief is entered in the bankruptcy case). If the lessee assumes the lease, the bankrupt debtor must pay or “cure” all existing monetary defaults under the lease. Further, the lease can only be assumed “as is”. The bankruptcy court would not be able to change the rental amount or any other lease provision that could financially impact us. However, if the lessee rejects the lease, the facility would be returned to us. If a lease is rejected, we may not be able to identify a new tenant, as interest in leasing certain of our assets would be dependent on ownership of an interest in nearby mineral rights. In addition, any new tenant would need to be a qualified reputable operator of such energy infrastructure assets with the wherewithal and capability of acting as our tenant. There is no assurance that we would be able to identify a tenant that meets these criteria, or that we could enter into a new lease with any such tenant on terms that are as favorable as the lease terms that were in place with the prior tenant. If we were able to re-lease the affected facility to a new tenant only on unfavorable terms or after a significant delay, we could lose some or all of the revenue from that facility for an extended period of time. Further, if the lease agreement is rejected, our claim against the lessee and/or parent guarantor could be, in some courts, subject to a statutory cap under section 502(b)(6) of the Bankruptcy Code to the extent the lease agreement is deemed to be a lease for real property rather than a lease for personal property. Such cap generally limits the amount of a claim for lease-based damages in the event of a termination of a commercial real property lease to the greater of one year's rent or 15 percent of the rent reserved for the remaining lease term, not to exceed 3 years. There is a national split of authority as to whether a rejection of such a lease equates a termination, so the outcome will depend on where the bankrupt lessee files its bankruptcy. We believe that any of our lease agreements would be characterized as real property leases rather than personal property leases, though a court could hold to the contrary.
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•
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aging infrastructure, mechanical or other performance problems;
|
•
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damage to pipelines, facilities and related equipment caused by tornadoes, hurricanes, floods, fires and other natural disasters, explosions and acts of terrorism;
|
•
|
inadvertent damage from third parties, including from construction, farm and utility equipment;
|
•
|
leaks of natural gas and other hydrocarbons or losses of natural gas as a result of the malfunction of equipment or facilities;
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•
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operator error;
|
•
|
environmental hazards, such as natural gas leaks, product and waste spills, pipeline and tank ruptures, and unauthorized discharges of products, wastes and other pollutants into the surface and subsurface environment, resulting in environmental pollution; and explosions.
|
•
|
MoGas may only charge rates that have been determined to be just and reasonable by FERC, subject to a prescribed maximum and minimum, and is prohibited from unduly preferring or unreasonably discriminating against any person with respect to its rates or terms and conditions of service.
|
•
|
MoGas' existing rates may be challenged in a proceeding before FERC, which may reduce MoGas' rates if FERC finds the rates are not just and reasonable or are unduly preferential or unduly discriminatory. Proposed rate increases may be challenged by protest and allowed to go into effect subject to refund. Even if a rate increase is permitted by FERC to become effective, the rate increase may not be adequate.
|
•
|
perform ongoing assessments of pipeline or asset integrity;
|
•
|
identify and characterize applicable threats to pipeline or asset segments that could impact a high consequence area;
|
•
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improve data collection, integration and analysis;
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•
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repair and remediate the pipeline or asset as necessary; and
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•
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implement preventative and mitigating actions.
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•
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result in the acceleration of a significant amount of debt for non-compliance with the terms of such debt or, if such debt contains cross-default or cross-acceleration provisions, other debt;
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•
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materially impair our ability to borrow undrawn amounts under existing financing arrangements or to obtain additional financing or refinancing on favorable terms or at all;
|
•
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require us to dedicate a substantial portion of our cash flow to paying principal and interest on our indebtedness, thereby reducing the cash flow available to fund our business, to pay distributions, including those necessary to maintain REIT qualification, or to use for other purposes;
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•
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increase our vulnerability to economic downturns;
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•
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limit our ability to withstand competitive pressures; or
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•
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reduce our flexibility to respond to changing business and economic conditions.
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•
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Prevailing interest rates, increases in which may have an adverse effect on the market price of the depositary shares representing interests in our Series A Preferred Stock;
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•
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The market for similar securities issued by other REITs;
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•
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General economic and financial market conditions;
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•
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The financial condition, performance and prospects of us, our tenants and our competitors;
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•
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Any rating assigned by a rating agency to the depositary shares;
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•
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Changes in financial estimates or recommendations by securities analysts with respect to us, our competitors or our industry; and
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•
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Actual or anticipated variations in our quarterly operating results and those of our competitors.
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•
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We are subject to the Business Combination Act of the Maryland General Corporation Law. However, pursuant to the statute, our Board of Directors has adopted a resolution exempting us from the Maryland Business Combination Act for any business combination between us and any person to the extent that such business combination receives the prior approval of our Board of Directors.
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•
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Our bylaws exempt from the Maryland Control Share Acquisition Act acquisitions of stock by any person. If we amend our bylaws to repeal the exemption from the Maryland Control Share Acquisition Act, the Maryland Control Share Acquisition Act also may make it more difficult to obtain control of our Company.
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•
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As described above, our charter includes a share ownership limit and other restrictions on ownership and transfer of shares, in each such case designed, among other purposes, to preserve our status as a REIT, which may have the effect of precluding an acquisition of control of us without the approval of our Board of Directors.
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•
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Under our charter, our Board of Directors is divided into three classes serving staggered terms, which may make it more difficult for a hostile bidder to acquire control of us.
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•
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Our charter contains a provision whereby we have elected to be subject to the provisions of Title 3, Subtitle 8 of the Maryland General Corporation Law relating to the filling of vacancies on our Board of Directors. Further, through provisions in our charter and bylaws unrelated to Subtitle 8, we (1) require a two-thirds vote for the removal of any director from the board, which removal must be for cause, (2) vest in the board the exclusive power to fix the number of directors, subject to limitations set forth in our charter and bylaws, (3) have a classified Board of Directors and (4) require that, unless a special meeting of stockholders is called by the chairman of our Board of Directors, our chief executive officer, our president or our Board of Directors, such a special meeting may be called to consider and vote on any matter that may properly be considered at a meeting of stockholders only at the request of stockholders entitled to cast not less than a majority of all votes entitled to be cast on a matter at such meeting.
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•
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In addition, our Board of Directors may, without stockholder action, authorize the issuance of shares of stock in one or more classes or series, including preferred stock. Our Board of Directors also may, without stockholder action, amend our charter to increase the number of shares of stock of any class or series that we have authority to issue.
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•
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Our bylaws include advance notice provisions, governing stockholders' director nominations or proposal of other business to be considered at an annual meeting of our stockholders, requiring the continuous ownership by the stockholder(s) putting forth any such nominee or proposal of at least one percent (1 percent) of our outstanding shares for a minimum period of at least three years prior to the date of such nomination or proposal and through the date of the related annual meeting (including any adjournment or postponement thereof), each as specified in the bylaws.
|
•
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Our bylaws designate certain Maryland courts as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a judicial forum that our stockholders believe is favorable for disputes with us or our directors, officers or employees.
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Asset Name
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Owner/Landlord
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Tenant
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Asset Location
|
Asset Description
|
Encumbrances (1)
|
Grand Isle Gathering System
|
Grand Isle Corridor, LP
|
Energy XXI GIGS Services, LLC (2)
|
Gulf of Mexico / Louisiana
|
Approximately 137 miles of offshore pipeline with total capacity of 120 thousand Bbls/d, including a 16-acre onshore terminal and saltwater disposal system
|
Security for the Company's $160 million revolving credit facility with Regions Bank
|
Pinedale Liquids Gathering System
|
Pinedale LP
|
Ultra Wyoming LGS LLC (3)
|
The Pinedale Anticline in Wyoming
|
Approximately 150 miles of pipelines and four central storage facilities
|
Security for the Amended Pinedale Term Credit Facility
|
(1) For additional information, see Part IV, Item 15, Note 11 ("Debt") included in this Report.
|
|||||
(2) Energy XXI GIGS Services, LLC's obligations under the Grand Isle Lease Agreement are guaranteed by EGC. For additional information, see "Additional Information Concerning the Grand Isle Gathering System" below.
|
|||||
(3) Ultra Wyoming's obligations under the Pinedale Lease Agreement are guaranteed by Ultra Petroleum and Ultra Petroleum's operating subsidiary, Ultra Resources. For additional information, see "Additional Information Concerning the Pinedale LGS" below.
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Conversion Date
|
|
Principal Amount of Convertible Notes Converted
|
|
Number of Shares of Common Stock Issued
|
|||
November 13, 2019
|
|
$
|
20,000
|
|
|
606
|
|
December 19, 2019
|
|
15,000
|
|
|
454
|
|
|
December 19, 2019
|
|
3,399,000
|
|
|
103,000
|
|
|
Total
|
|
$
|
3,434,000
|
|
|
104,060
|
|
|
Cumulative Value of $100 Investment, through December 31,
|
||||||||||||||||||||||
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2014
|
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2015
|
|
2016
|
|
2017
|
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2018
|
|
2019
|
||||||||||||
CorEnergy Infrastructure Trust, Inc.
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$
|
100.00
|
|
|
$
|
48.70
|
|
|
$
|
143.61
|
|
|
$
|
176.95
|
|
|
$
|
158.04
|
|
|
$
|
233.21
|
|
FTSE NAREIT All Equity REIT Index
|
100.00
|
|
|
102.24
|
|
|
111.89
|
|
|
123.67
|
|
|
114.05
|
|
|
153.07
|
|
||||||
Dow Jones Utilities Average Index
|
100.00
|
|
|
94.22
|
|
|
109.52
|
|
|
122.57
|
|
|
119.39
|
|
|
154.86
|
|
||||||
S&P Global Infrastructure Index
|
100.00
|
|
|
88.04
|
|
|
98.68
|
|
|
118.35
|
|
|
104.75
|
|
|
133.20
|
|
||||||
Alerian MLP Index
|
100.00
|
|
|
70.43
|
|
|
88.68
|
|
|
85.03
|
|
|
71.09
|
|
|
78.93
|
|
|
For the Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Operating Data
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenue
|
$
|
85,945,570
|
|
|
$
|
89,231,598
|
|
|
$
|
88,749,377
|
|
|
$
|
89,250,586
|
|
|
$
|
71,288,935
|
|
Net Income attributable to CorEnergy Stockholders
|
4,079,495
|
|
|
43,711,876
|
|
|
32,602,790
|
|
|
29,663,200
|
|
|
12,319,911
|
|
|||||
Net Income (Loss) attributable to Common Stockholders
|
(5,175,973
|
)
|
|
34,163,499
|
|
|
24,648,802
|
|
|
25,514,763
|
|
|
8,471,083
|
|
|||||
Per Share Data
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income (Loss) attributable to Common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(0.40
|
)
|
|
$
|
2.86
|
|
|
$
|
2.07
|
|
|
$
|
2.14
|
|
|
$
|
0.79
|
|
Diluted
|
(0.40
|
)
|
|
2.79
|
|
|
2.07
|
|
|
2.14
|
|
|
0.79
|
|
|||||
Cash dividends declared per common share
|
3.000
|
|
|
3.000
|
|
|
3.000
|
|
|
3.000
|
|
|
2.750
|
|
|||||
Other Data
|
|
|
|
|
|
|
|
|
|
||||||||||
AFFO attributable to Common stockholders(1)
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
4.06
|
|
|
$
|
4.11
|
|
|
$
|
4.25
|
|
|
$
|
4.41
|
|
|
$
|
3.77
|
|
Diluted
|
3.83
|
|
|
3.70
|
|
|
3.81
|
|
|
3.93
|
|
|
3.56
|
|
|||||
(1) We believe that net income (loss), as defined by U.S. GAAP, is the most appropriate earnings measurement. However, we consider Adjusted Funds From Operations ("AFFO") to be an appropriate measure of operating performance of an equity REIT. See "Management's Discussion and Analysis of Financial Condition and Results of Operations - Non-GAAP Financial Measures" included in Item 7 of this Report for a reconciliation of AFFO to our GAAP earnings.
|
|
As of December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Balance sheet data
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
651,455,794
|
|
|
$
|
624,883,180
|
|
|
$
|
633,418,113
|
|
|
$
|
650,732,571
|
|
|
$
|
677,979,621
|
|
Current debt maturities
|
5,612,178
|
|
|
3,528,000
|
|
|
3,528,000
|
|
|
7,128,556
|
|
|
66,132,000
|
|
|||||
Long-term debt
|
146,497,248
|
|
|
146,510,380
|
|
|
149,249,437
|
|
|
193,504,324
|
|
|
150,732,752
|
|
|||||
CorEnergy equity - Preferred
|
125,493,175
|
|
|
125,555,675
|
|
|
130,000,000
|
|
|
56,250,000
|
|
|
56,250,000
|
|
|||||
CorEnergy equity - Common
|
351,246,264
|
|
|
329,455,630
|
|
|
331,785,632
|
|
|
350,218,436
|
|
|
361,784,244
|
|
|
For the Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Management fees
|
$
|
6,786,637
|
|
|
$
|
7,591,750
|
|
Acquisition and professional fees
|
2,413,617
|
|
|
3,759,505
|
|
||
Other expenses
|
1,396,594
|
|
|
1,691,592
|
|
||
Total
|
$
|
10,596,848
|
|
|
$
|
13,042,847
|
|
|
For the Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Gross cash distributions and other income received from investment securities
|
$
|
1,328,853
|
|
|
$
|
770,734
|
|
Add:
|
|
|
|
||||
Cash distributions received in prior period previously deemed a return of capital (dividend income) which have been reclassified as income (return of capital) in a subsequent period
|
—
|
|
|
—
|
|
||
Less:
|
|
|
|
||||
Cash distributions and dividends received in current period deemed a return of capital and not recorded as income (recorded as a cost reduction) in the current period
|
—
|
|
|
663,939
|
|
||
Net distributions and other income
|
$
|
1,328,853
|
|
|
$
|
106,795
|
|
|
For the Years Ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Management fees
|
$
|
7,591,750
|
|
|
$
|
7,213,720
|
|
Acquisition and professional fees
|
3,759,505
|
|
|
2,380,918
|
|
||
Other expenses
|
1,691,592
|
|
|
1,191,859
|
|
||
Total
|
$
|
13,042,847
|
|
|
$
|
10,786,497
|
|
|
For the Years Ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Gross cash distributions and other income received from investment securities
|
$
|
770,734
|
|
|
$
|
949,646
|
|
Add:
|
|
|
|
||||
Cash distributions received in prior period previously deemed a return of capital (dividend income) which have been reclassified as income (return of capital) in a subsequent period
|
—
|
|
|
(148,649
|
)
|
||
Less:
|
|
|
|
||||
Cash distributions and dividends received in current period deemed a return of capital and not recorded as income (recorded as a cost reduction) in the current period
|
663,939
|
|
|
120,906
|
|
||
Net distributions and other income
|
$
|
106,795
|
|
|
$
|
680,091
|
|
Book Value Per Common Share
|
|||||||
Analysis of Equity
|
December 31, 2019
|
|
December 31, 2018
|
||||
Series A Cumulative Redeemable Preferred Stock 7.375%, $125,493,175 and $125,555,675 liquidation preference ($2,500 per share, $0.001 par value), 10,000,000 authorized; 50,197 and 50,222 issued and outstanding at December 31, 2019 and December 31, 2018, respectively
|
$
|
125,493,175
|
|
|
$
|
125,555,675
|
|
Capital stock, non-convertible, $0.001 par value; 13,638,916 and 11,960,225 shares issued and outstanding at December 31, 2019 and December 31, 2018 (100,000,000 shares authorized)
|
13,639
|
|
|
11,960
|
|
||
Additional paid-in capital
|
360,844,497
|
|
|
320,295,969
|
|
||
Retained earnings (deficit)
|
(9,611,872
|
)
|
|
9,147,701
|
|
||
Total CorEnergy Stockholders' Equity
|
$
|
476,739,439
|
|
|
$
|
455,011,305
|
|
Subtract: 7.375% Series A Preferred Stock
|
(125,493,175
|
)
|
|
(125,555,675
|
)
|
||
Total CorEnergy Common Equity
|
$
|
351,246,264
|
|
|
$
|
329,455,630
|
|
Common shares outstanding
|
13,638,916
|
|
|
11,960,225
|
|
||
Book Value per Common Share
|
$
|
25.75
|
|
|
$
|
27.55
|
|
NAREIT FFO, FFO Adjusted for Securities Investment, and AFFO Reconciliation
|
|||||||||||
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net Income attributable to CorEnergy Stockholders
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
32,602,790
|
|
Less:
|
|
|
|
|
|
||||||
Preferred Dividend Requirements
|
9,255,468
|
|
|
9,548,377
|
|
|
7,953,988
|
|
|||
Net Income (Loss) attributable to Common Stockholders
|
$
|
(5,175,973
|
)
|
|
$
|
34,163,499
|
|
|
$
|
24,648,802
|
|
Add:
|
|
|
|
|
|
||||||
Depreciation
|
22,046,041
|
|
|
24,355,959
|
|
|
23,292,713
|
|
|||
Less:
|
|
|
|
|
|
||||||
Gain on the sale of leased property, net
|
—
|
|
|
11,723,257
|
|
|
—
|
|
|||
Non-Controlling Interest attributable to NAREIT FFO reconciling items
|
—
|
|
|
—
|
|
|
1,632,546
|
|
|||
NAREIT funds from operations (NAREIT FFO)
|
$
|
16,870,068
|
|
|
$
|
46,796,201
|
|
|
$
|
46,308,969
|
|
Add:
|
|
|
|
|
|
||||||
Distributions received from investment securities
|
1,328,853
|
|
|
106,795
|
|
|
949,646
|
|
|||
Income tax expense (benefit) from investment securities
|
(12,584
|
)
|
|
(682,199
|
)
|
|
1,000,084
|
|
|||
Less:
|
|
|
|
|
|
||||||
Net distributions and other income
|
1,328,853
|
|
|
106,795
|
|
|
680,091
|
|
|||
Net realized and unrealized gain (loss) on other equity securities
|
—
|
|
|
(1,845,309
|
)
|
|
1,531,827
|
|
|||
Funds from operations adjusted for securities investments (FFO)
|
$
|
16,857,484
|
|
|
$
|
47,959,311
|
|
|
$
|
46,046,781
|
|
Add:
|
|
|
|
|
|
||||||
Loss of extinguishment of debt
|
33,960,565
|
|
|
—
|
|
|
336,933
|
|
|||
Transaction costs
|
185,495
|
|
|
521,311
|
|
|
592,068
|
|
|||
Amortization of debt issuance costs
|
1,226,139
|
|
|
1,414,457
|
|
|
1,661,181
|
|
|||
Amortization of deferred lease costs
|
91,932
|
|
|
91,932
|
|
|
91,932
|
|
|||
Accretion of asset retirement obligation
|
443,969
|
|
|
499,562
|
|
|
663,065
|
|
|||
Non-cash loss associated with derivative instruments
|
—
|
|
|
—
|
|
|
33,763
|
|
|||
Loss on settlement of ARO
|
—
|
|
|
310,941
|
|
|
—
|
|
|||
Less:
|
|
|
|
|
|
||||||
Non-cash settlement of accounts payable
|
—
|
|
|
—
|
|
|
221,609
|
|
|||
Income tax (expense) benefit
|
(247,202
|
)
|
|
1,736,527
|
|
|
(1,345,234
|
)
|
|||
Provision for loan gain
|
—
|
|
|
36,867
|
|
|
—
|
|
|||
Non-Controlling Interest attributable to AFFO reconciling items
|
—
|
|
|
—
|
|
|
13,154
|
|
|||
Adjusted funds from operations (AFFO)
|
$
|
53,012,786
|
|
|
$
|
49,024,120
|
|
|
$
|
50,536,194
|
|
|
|
|
|
|
|
|
|
|
|||
Weighted Average Shares of Common Stock Outstanding:
|
|
|
|
|
|
|
|
|
|||
Basic
|
13,041,613
|
|
|
11,935,021
|
|
|
11,900,516
|
|
|||
Diluted
|
15,425,747
|
|
|
15,389,180
|
|
|
15,355,061
|
|
|||
NAREIT FFO attributable to Common Stockholders
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
1.29
|
|
|
$
|
3.92
|
|
|
$
|
3.89
|
|
Diluted (1)
|
$
|
1.29
|
|
|
$
|
3.61
|
|
|
$
|
3.59
|
|
FFO attributable to Common Stockholders
|
|
|
|
|
|
||||||
Basic
|
$
|
1.29
|
|
|
$
|
4.02
|
|
|
$
|
3.87
|
|
Diluted (1)
|
$
|
1.29
|
|
|
$
|
3.69
|
|
|
$
|
3.57
|
|
AFFO attributable to Common Stockholders
|
|
|
|
|
|
||||||
Basic
|
$
|
4.06
|
|
|
$
|
4.11
|
|
|
$
|
4.25
|
|
Diluted (2)
|
$
|
3.83
|
|
|
$
|
3.70
|
|
|
$
|
3.81
|
|
(1) The year ended December 31, 2019 diluted per share calculations exclude dilutive adjustments for convertible note interest expense, discount amortization and deferred debt issuance amortization because such impact is antidilutive. The years ended December 31, 2018 and 2017 include these dilutive adjustments. For periods presented without per share dilution, the number of weighted average diluted shares is equal to the number of weighted average basic shares presented. Refer to the Convertible Note Interest Expense table in Part IV, Item 15, Note 11 ("Debt") for additional details.
|
|||||||||||
(2) Diluted per share calculations include a dilutive adjustment for convertible note interest expense. Refer to the Convertible Note Interest Expense table in Part IV, Item 15, Note 11 ("Debt") for additional details.
|
NAREIT FFO, FFO Adjusted for Securities Investment, and AFFO Reconciliation
|
|||||||||||||||
|
For the Fiscal 2019 Quarters Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Net Income (Loss) attributable to CorEnergy Stockholders
|
$
|
3,866,441
|
|
|
$
|
9,824,926
|
|
|
$
|
(19,419,600
|
)
|
|
$
|
9,807,728
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Preferred Dividend Requirements
|
2,314,128
|
|
|
2,313,780
|
|
|
2,313,780
|
|
|
2,313,780
|
|
||||
Net Income (Loss) attributable to Common Stockholders
|
$
|
1,552,313
|
|
|
$
|
7,511,146
|
|
|
$
|
(21,733,380
|
)
|
|
$
|
7,493,948
|
|
Add:
|
|
|
|
|
|
|
|
||||||||
Depreciation
|
5,511,121
|
|
|
5,511,274
|
|
|
5,511,367
|
|
|
5,512,279
|
|
||||
NAREIT funds from operations (NAREIT FFO)
|
$
|
7,063,434
|
|
|
$
|
13,022,420
|
|
|
$
|
(16,222,013
|
)
|
|
$
|
13,006,227
|
|
Add:
|
|
|
|
|
|
|
|
||||||||
Distributions received from investment securities
|
256,615
|
|
|
285,259
|
|
|
360,182
|
|
|
426,797
|
|
||||
Income tax expense (benefit) from investment securities
|
151,793
|
|
|
6,912
|
|
|
45,205
|
|
|
(216,494
|
)
|
||||
Less:
|
|
|
|
|
|
|
|
||||||||
Net distributions and other income
|
256,615
|
|
|
285,259
|
|
|
360,182
|
|
|
426,797
|
|
||||
Funds from operations adjusted for securities investments (FFO)
|
$
|
7,215,227
|
|
|
$
|
13,029,332
|
|
|
$
|
(16,176,808
|
)
|
|
$
|
12,789,733
|
|
Add:
|
|
|
|
|
|
|
|
||||||||
Loss of extinguishment of debt
|
5,039,731
|
|
|
—
|
|
|
28,920,834
|
|
|
—
|
|
||||
Transaction costs
|
53,970
|
|
|
88,611
|
|
|
14,799
|
|
|
28,115
|
|
||||
Amortization of debt issuance costs
|
298,432
|
|
|
281,630
|
|
|
313,022
|
|
|
333,055
|
|
||||
Amortization of deferred lease costs
|
22,983
|
|
|
22,983
|
|
|
22,983
|
|
|
22,983
|
|
||||
Accretion of asset retirement obligation
|
110,992
|
|
|
110,993
|
|
|
110,992
|
|
|
110,992
|
|
||||
Less:
|
|
|
|
|
|
|
|
||||||||
Income tax (expense) benefit
|
(295,542
|
)
|
|
(55,787
|
)
|
|
137,911
|
|
|
(33,784
|
)
|
||||
Adjusted funds from operations (AFFO)
|
$
|
13,036,877
|
|
|
$
|
13,589,336
|
|
|
$
|
13,067,911
|
|
|
$
|
13,318,662
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted Average Shares of Common Stock Outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
12,604,943
|
|
|
12,811,171
|
|
|
13,188,546
|
|
|
13,549,797
|
|
||||
Diluted
|
15,042,567
|
|
|
14,934,886
|
|
|
15,609,545
|
|
|
16,102,310
|
|
||||
NAREIT FFO attributable to Common Stockholders
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.56
|
|
|
$
|
1.02
|
|
|
$
|
(1.23
|
)
|
|
$
|
0.96
|
|
Diluted (1)
|
$
|
0.56
|
|
|
$
|
0.96
|
|
|
$
|
(1.23
|
)
|
|
$
|
0.93
|
|
FFO attributable to Common Stockholders
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.57
|
|
|
$
|
1.02
|
|
|
$
|
(1.23
|
)
|
|
$
|
0.94
|
|
Diluted (1)
|
$
|
0.57
|
|
|
$
|
0.96
|
|
|
$
|
(1.23
|
)
|
|
$
|
0.92
|
|
AFFO attributable to Common Stockholders
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.03
|
|
|
$
|
1.06
|
|
|
$
|
0.99
|
|
|
$
|
0.98
|
|
Diluted (2)
|
$
|
0.96
|
|
|
$
|
0.99
|
|
|
$
|
0.94
|
|
|
$
|
0.94
|
|
(1) The fiscal 2019 quarters ended for March 31 and September 30 diluted per share calculations exclude dilutive adjustments for convertible note interest expense, discount amortization and deferred debt issuance amortization because such impact is antidilutive. The fiscal 2019 quarters ended June 30 and December 31 include these dilutive adjustments. For periods presented without per share dilution, the number of weighted average diluted shares is equal to the number of weighted average basic shares presented.
|
|||||||||||||||
(2) Diluted per share calculations include a dilutive adjustment for convertible note interest expense.
|
|
As a Percentage of (1)
|
|||||||||||||
|
Leased Properties
|
|
Lease Revenues
|
|||||||||||
|
As of December 31,
|
|
For the Years Ended December 31,
|
|||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2017
|
|||||
Pinedale LGS (2)
|
44.4
|
%
|
|
44.5
|
%
|
|
39.2
|
%
|
|
35.2
|
%
|
|
31.2
|
%
|
Grand Isle Gathering System
|
55.3
|
%
|
|
55.2
|
%
|
|
60.6
|
%
|
|
55.9
|
%
|
|
59.1
|
%
|
Portland Terminal Facility (3)
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
8.8
|
%
|
|
9.6
|
%
|
(1) Insignificant leases are not presented; thus percentages may not sum to 100%.
|
||||||||||||||
(2) Pinedale LGS lease revenues include variable rent of $4.6 million, $4.3 million and $587 thousand for the years ended December 31, 2019, 2018 and 2017, respectively.
|
||||||||||||||
(3) On December 21, 2018, the Portland Terminal Facility was sold to Zenith Terminals, terminating the Portland Lease Agreement.
|
Contractual Obligations
|
|||||||||||||||||||
|
Notional Value
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
||||||||||
Pinedale LP Debt
|
$
|
33,944,000
|
|
|
$
|
3,528,000
|
|
|
$
|
30,416,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest payments on Pinedale LP Debt
|
|
|
2,107,331
|
|
|
3,607,076
|
|
|
—
|
|
|
—
|
|
||||||
7.00% Convertible Debt(1)
|
2,092,000
|
|
|
2,092,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Interest payments on 7.00% Convertible Debt(1)
|
|
|
73,220
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
5.875% Convertible Debt
|
120,000,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
120,000,000
|
|
|||||
Interest payments on 5.875% Convertible Debt
|
|
|
7,108,750
|
|
|
14,100,000
|
|
|
14,100,000
|
|
|
7,050,000
|
|
||||||
Totals
|
|
|
$
|
14,909,301
|
|
|
$
|
48,123,076
|
|
|
$
|
14,100,000
|
|
|
$
|
127,050,000
|
|
||
(1) Subsequent to December 31, 2019, holders of the 7.00% Convertible Notes converted $416 thousand face amount of notes for 12,605 shares of common stock, reducing (i) the 7.00% Convertible Notes outstanding to $1.7 million and (ii) interest expense to $59 thousand in 2020.
|
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
61,779,104
|
|
|
$
|
48,622,740
|
|
|
$
|
56,791,571
|
|
Investing activities
|
4,699,066
|
|
|
56,816,490
|
|
|
7,595,477
|
|
|||
Financing activities
|
(14,901,704
|
)
|
|
(51,939,122
|
)
|
|
(56,495,063
|
)
|
|||
Net increase in cash and cash equivalents
|
$
|
51,576,466
|
|
|
$
|
53,500,108
|
|
|
$
|
7,891,985
|
|
Exhibit No.
|
Description of Document
|
|
|
3.1
|
|
3.2
|
|
3.3
|
|
3.4
|
|
4.1
|
|
4.2
|
|
4.3.1
|
|
4.3.2
|
|
4.4
|
|
4.5
|
|
4.6
|
|
10.1.1
|
|
10.1.2
|
|
10.2.1
|
|
10.2.2
|
|
10.2.3
|
|
10.2.4
|
|
10.2.5
|
|
10.2.6
|
|
10.2.7
|
|
10.2.8
|
|
10.2.9
|
10.3.1
|
|
10.3.2
|
|
10.4.1
|
|
10.4.2
|
|
10.5
|
|
10.6.1
|
|
10.6.2
|
|
10.6.3
|
|
10.7
|
|
10.8
|
|
10.9
|
|
10.9.1
|
|
10.9.2
|
|
10.10
|
|
10.10.1
|
|
10.11.1
|
|
10.11.2
|
|
10.11.3
|
|
10.12.1
|
|
10.12.2
|
|
10.12.3
|
|
10.12.4
|
|
10.12.5
|
|
10.12.6
|
|
10.13.1
|
|
10.13.2
|
|
10.14
|
|
10.15.1
|
|
10.15.2
|
|
|
|
Page No.
|
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
|||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
||||
Leased property, net of accumulated depreciation of $105,825,816 and $87,154,095
|
$
|
379,211,399
|
|
|
$
|
398,214,355
|
|
Property and equipment, net of accumulated depreciation of $19,304,610 and $15,969,346
|
106,855,677
|
|
|
109,881,552
|
|
||
Financing notes and related accrued interest receivable, net of reserve of $600,000 and $600,000
|
1,235,000
|
|
|
1,300,000
|
|
||
Note receivable
|
—
|
|
|
5,000,000
|
|
||
Cash and cash equivalents
|
120,863,643
|
|
|
69,287,177
|
|
||
Deferred rent receivable
|
29,858,102
|
|
|
25,942,755
|
|
||
Accounts and other receivables
|
4,143,234
|
|
|
5,083,243
|
|
||
Deferred costs, net of accumulated amortization of $1,956,710 and $1,290,236
|
2,171,969
|
|
|
2,838,443
|
|
||
Prepaid expenses and other assets
|
804,341
|
|
|
668,584
|
|
||
Deferred tax asset, net
|
4,593,561
|
|
|
4,948,203
|
|
||
Goodwill
|
1,718,868
|
|
|
1,718,868
|
|
||
Total Assets
|
$
|
651,455,794
|
|
|
$
|
624,883,180
|
|
Liabilities and Equity
|
|
|
|
||||
Secured credit facilities, net of debt issuance costs of $158,070 and $210,891
|
33,785,930
|
|
|
37,261,109
|
|
||
Unsecured convertible senior notes, net of discount and debt issuance costs of $3,768,504 and $1,180,729
|
118,323,496
|
|
|
112,777,271
|
|
||
Asset retirement obligation
|
8,044,200
|
|
|
7,956,343
|
|
||
Accounts payable and other accrued liabilities
|
6,000,981
|
|
|
3,493,490
|
|
||
Management fees payable
|
1,669,950
|
|
|
1,831,613
|
|
||
Unearned revenue
|
6,891,798
|
|
|
6,552,049
|
|
||
Total Liabilities
|
$
|
174,716,355
|
|
|
$
|
169,871,875
|
|
Equity
|
|
|
|
||||
Series A Cumulative Redeemable Preferred Stock 7.375%, $125,493,175 and $125,555,675 liquidation preference ($2,500 per share, $0.001 par value), 10,000,000 authorized; 50,197 and 50,222 issued and outstanding at December 31, 2019 and December 31, 2018, respectively
|
$
|
125,493,175
|
|
|
$
|
125,555,675
|
|
Capital stock, non-convertible, $0.001 par value; 13,638,916 and 11,960,225 shares issued and outstanding at December 31, 2019 and December 31, 2018 (100,000,000 shares authorized)
|
13,639
|
|
|
11,960
|
|
||
Additional paid-in capital
|
360,844,497
|
|
|
320,295,969
|
|
||
Retained earnings (deficit)
|
(9,611,872
|
)
|
|
9,147,701
|
|
||
Total Equity
|
476,739,439
|
|
|
455,011,305
|
|
||
Total Liabilities and Equity
|
$
|
651,455,794
|
|
|
$
|
624,883,180
|
|
See accompanying Notes to Consolidated Financial Statements.
|
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenue
|
|
|
|
|
|
||||||
Lease revenue
|
$
|
67,050,506
|
|
|
$
|
72,747,362
|
|
|
$
|
68,803,804
|
|
Transportation and distribution revenue
|
18,778,237
|
|
|
16,484,236
|
|
|
19,945,573
|
|
|||
Financing revenue
|
116,827
|
|
|
—
|
|
|
—
|
|
|||
Total Revenue
|
85,945,570
|
|
|
89,231,598
|
|
|
88,749,377
|
|
|||
Expenses
|
|
|
|
|
|
||||||
Transportation and distribution expenses
|
5,242,244
|
|
|
7,210,748
|
|
|
6,729,707
|
|
|||
General and administrative
|
10,596,848
|
|
|
13,042,847
|
|
|
10,786,497
|
|
|||
Depreciation, amortization and ARO accretion expense
|
22,581,942
|
|
|
24,947,453
|
|
|
24,047,710
|
|
|||
Provision for loan gain
|
—
|
|
|
(36,867
|
)
|
|
—
|
|
|||
Total Expenses
|
38,421,034
|
|
|
45,164,181
|
|
|
41,563,914
|
|
|||
Operating Income
|
$
|
47,524,536
|
|
|
$
|
44,067,417
|
|
|
$
|
47,185,463
|
|
Other Income (Expense)
|
|
|
|
|
|
||||||
Net distributions and other income
|
$
|
1,328,853
|
|
|
$
|
106,795
|
|
|
$
|
680,091
|
|
Net realized and unrealized gain (loss) on other equity securities
|
—
|
|
|
(1,845,309
|
)
|
|
1,531,827
|
|
|||
Interest expense
|
(10,578,711
|
)
|
|
(12,759,010
|
)
|
|
(12,378,514
|
)
|
|||
Gain on the sale of leased property, net
|
—
|
|
|
11,723,257
|
|
|
—
|
|
|||
Loss on extinguishment of debt
|
(33,960,565
|
)
|
|
—
|
|
|
(336,933
|
)
|
|||
Total Other Expense
|
(43,210,423
|
)
|
|
(2,774,267
|
)
|
|
(10,503,529
|
)
|
|||
Income before income taxes
|
4,314,113
|
|
|
41,293,150
|
|
|
36,681,934
|
|
|||
Taxes
|
|
|
|
|
|
||||||
Current tax expense (benefit)
|
(120,024
|
)
|
|
(585,386
|
)
|
|
2,831,658
|
|
|||
Deferred tax expense (benefit)
|
354,642
|
|
|
(1,833,340
|
)
|
|
(486,340
|
)
|
|||
Income tax expense (benefit), net
|
234,618
|
|
|
(2,418,726
|
)
|
|
2,345,318
|
|
|||
Net Income
|
4,079,495
|
|
|
43,711,876
|
|
|
34,336,616
|
|
|||
Less: Net Income attributable to non-controlling interest
|
—
|
|
|
—
|
|
|
1,733,826
|
|
|||
Net Income attributable to CorEnergy Stockholders
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
32,602,790
|
|
Preferred dividend requirements
|
9,255,468
|
|
|
9,548,377
|
|
|
7,953,988
|
|
|||
Net Income (Loss) attributable to Common Stockholders
|
$
|
(5,175,973
|
)
|
|
$
|
34,163,499
|
|
|
$
|
24,648,802
|
|
|
|
|
|
|
|
||||||
Net Income
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
34,336,616
|
|
Other comprehensive income:
|
|
|
|
|
|
||||||
Changes in fair value of qualifying hedges / AOCI attributable to CorEnergy stockholders
|
—
|
|
|
—
|
|
|
11,196
|
|
|||
Changes in fair value of qualifying hedges / AOCI attributable to non-controlling interest
|
—
|
|
|
—
|
|
|
2,617
|
|
|||
Net Change in Other Comprehensive Income
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
13,813
|
|
Total Comprehensive Income
|
4,079,495
|
|
|
43,711,876
|
|
|
34,350,429
|
|
|||
Less: Comprehensive income attributable to non-controlling interest
|
—
|
|
|
—
|
|
|
1,736,443
|
|
|||
Comprehensive Income attributable to CorEnergy Stockholders
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
32,613,986
|
|
Earnings (Loss) Per Common Share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.40
|
)
|
|
$
|
2.86
|
|
|
$
|
2.07
|
|
Diluted
|
$
|
(0.40
|
)
|
|
$
|
2.79
|
|
|
$
|
2.07
|
|
Weighted Average Shares of Common Stock Outstanding:
|
|
|
|
|
|
||||||
Basic
|
13,041,613
|
|
|
11,935,021
|
|
|
11,900,516
|
|
|||
Diluted
|
13,041,613
|
|
|
15,389,180
|
|
|
11,900,516
|
|
|||
Dividends declared per share
|
$
|
3.000
|
|
|
$
|
3.000
|
|
|
$
|
3.000
|
|
See accompanying Notes to Consolidated Financial Statements.
|
|
Capital Stock
|
|
Preferred Stock
|
|
Additional
Paid-in Capital |
|
Accumulated Other Comprehensive Income (Loss)
|
|
Retained
Earnings (Deficit) |
|
Non-Controlling
Interest |
|
Total
|
|||||||||||||||||
|
Shares
|
|
Amount
|
|
Amount
|
|
|
|
|
|
||||||||||||||||||||
Balance at December 31, 2016
|
11,886,216
|
|
|
$
|
11,886
|
|
|
$
|
56,250,000
|
|
|
$
|
350,217,746
|
|
|
$
|
(11,196
|
)
|
|
$
|
—
|
|
|
$
|
27,441,044
|
|
|
$
|
433,909,480
|
|
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,602,790
|
|
|
1,733,826
|
|
|
34,336,616
|
|
|||||||
Amortization related to de-designated cash flow hedges
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,196
|
|
|
—
|
|
|
2,617
|
|
|
13,813
|
|
|||||||
Total comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,196
|
|
|
32,602,790
|
|
|
1,736,443
|
|
|
34,350,429
|
|
|||||||
Issuance of Series A preferred stock
|
—
|
|
|
—
|
|
|
73,750,000
|
|
|
(2,588,469
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71,161,531
|
|
|||||||
Series A preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(727,001
|
)
|
|
—
|
|
|
(7,500,733
|
)
|
|
—
|
|
|
(8,227,734
|
)
|
|||||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,592,143
|
)
|
|
—
|
|
|
(25,102,057
|
)
|
|
—
|
|
|
(35,694,200
|
)
|
|||||||
Common stock issued under director's compensation plan
|
1,979
|
|
|
2
|
|
|
—
|
|
|
67,498
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,500
|
|
|||||||
Distributions to Non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,833,650
|
)
|
|
(1,833,650
|
)
|
|||||||
Purchase of non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,566,195
|
)
|
|
—
|
|
|
—
|
|
|
(27,343,837
|
)
|
|
(32,910,032
|
)
|
|||||||
Reinvestment of dividends paid to common stockholders
|
27,635
|
|
|
28
|
|
|
—
|
|
|
962,280
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
962,308
|
|
|||||||
Balance at December 31, 2017
|
11,915,830
|
|
|
11,916
|
|
|
130,000,000
|
|
|
331,773,716
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
461,785,632
|
|
|||||||
Cumulative transition adjustment upon the adoption of ASC 606, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,449,245
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,449,245
|
)
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
43,711,876
|
|
|
—
|
|
|
43,711,876
|
|
||||||||
Series A preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,587,500
|
)
|
|
—
|
|
|
(9,587,500
|
)
|
|||||||
Preferred stock repurchases(1)
|
—
|
|
|
—
|
|
|
(4,444,325
|
)
|
|
158,218
|
|
|
—
|
|
|
10,554
|
|
|
—
|
|
|
(4,275,553
|
)
|
|||||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,806,660
|
)
|
|
—
|
|
|
(24,987,229
|
)
|
|
—
|
|
|
(35,793,889
|
)
|
|||||||
Common stock issued under director's compensation plan
|
1,807
|
|
|
2
|
|
|
—
|
|
|
67,498
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,500
|
|
|||||||
Common stock issued upon conversion of convertible notes
|
1,271
|
|
|
1
|
|
|
—
|
|
|
42,653
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,654
|
|
|||||||
Reinvestment of dividends paid to common stockholders
|
41,317
|
|
|
41
|
|
|
—
|
|
|
1,509,789
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,509,830
|
|
|||||||
Balance at December 31, 2018 (2)
|
11,960,225
|
|
|
11,960
|
|
|
125,555,675
|
|
|
320,295,969
|
|
|
—
|
|
|
9,147,701
|
|
|
—
|
|
|
455,011,305
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,079,495
|
|
|
—
|
|
|
4,079,495
|
|
|||||||
Series A preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,627,561
|
)
|
|
—
|
|
|
(4,627,560
|
)
|
|
—
|
|
|
(9,255,121
|
)
|
|||||||
Preferred stock repurchases(3)
|
—
|
|
|
—
|
|
|
(62,500
|
)
|
|
2,195
|
|
|
—
|
|
|
(245
|
)
|
|
—
|
|
|
(60,550
|
)
|
|||||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,293,224
|
)
|
|
—
|
|
|
(18,211,263
|
)
|
|
—
|
|
|
(39,504,487
|
)
|
|||||||
Common stock issued upon exchange of convertible notes
|
1,540,472
|
|
|
1,540
|
|
|
—
|
|
|
61,869,762
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
61,871,302
|
|
|||||||
Common stock issued upon conversion of convertible notes
|
127,143
|
|
|
128
|
|
|
—
|
|
|
4,193,536
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,193,664
|
|
|||||||
Reinvestment of dividends paid to common stockholders
|
11,076
|
|
|
11
|
|
|
—
|
|
|
403,820
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
403,831
|
|
|||||||
Balance at December 31, 2019
|
13,638,916
|
|
|
$
|
13,639
|
|
|
$
|
125,493,175
|
|
|
$
|
360,844,497
|
|
|
$
|
—
|
|
|
$
|
(9,611,872
|
)
|
|
$
|
—
|
|
|
$
|
476,739,439
|
|
See accompanying Notes to Consolidated Financial Statements.
|
||||||||||||||||||||||||||||||
(1) In connection with the repurchases of Series A Preferred Stock during 2018, the deduction to preferred dividends of $10,554 represents the discount in the repurchase price paid compared to the carrying amount derecognized.
|
||||||||||||||||||||||||||||||
(2) The retained earnings balance at December 31, 2018 was generated due to the timing of quarterly dividends and quarterly net income. In the fourth quarter of 2018, net income was greater than dividends due to the gain on sale of leased property, net from the sale of the Portland Terminal Facility resulting in a retained earnings balance as of December 31, 2018.
|
||||||||||||||||||||||||||||||
(3) In connection with the repurchases of Series A Preferred Stock during 2019, the addition to preferred dividends of $245 represents the premium in the repurchase price paid compared to the carrying amount derecognized.
|
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net Income
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
34,336,616
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Deferred income tax, net
|
354,642
|
|
|
(1,845,710
|
)
|
|
(486,340
|
)
|
|||
Depreciation, amortization and ARO accretion
|
23,808,083
|
|
|
26,361,907
|
|
|
25,708,891
|
|
|||
Gain on sale of leased property, net
|
—
|
|
|
(11,723,257
|
)
|
|
—
|
|
|||
Provision for loan gain
|
—
|
|
|
(36,867
|
)
|
|
—
|
|
|||
Loss on extinguishment of debt
|
33,960,565
|
|
|
—
|
|
|
336,933
|
|
|||
Non-cash settlement of accounts payable
|
—
|
|
|
—
|
|
|
(221,609
|
)
|
|||
(Gain) loss on sale of equipment
|
(7,390
|
)
|
|
(8,416
|
)
|
|
4,203
|
|
|||
Net distributions and other income, including recharacterization of income
|
—
|
|
|
—
|
|
|
148,649
|
|
|||
Net realized and unrealized (gain) loss on other equity securities
|
—
|
|
|
1,845,309
|
|
|
(1,531,827
|
)
|
|||
Loss on settlement of asset retirement obligation
|
—
|
|
|
310,941
|
|
|
—
|
|
|||
Common stock issued under directors' compensation plan
|
—
|
|
|
67,500
|
|
|
67,500
|
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Increase in deferred rent receivables
|
(3,915,347
|
)
|
|
(7,038,848
|
)
|
|
(7,184,005
|
)
|
|||
(Increase) decrease in accounts and other receivables
|
940,009
|
|
|
(1,297,207
|
)
|
|
752,848
|
|
|||
(Increase) decrease in prepaid expenses and other assets
|
(136,108
|
)
|
|
73,505
|
|
|
(16,717
|
)
|
|||
Increase (decrease) in management fee payable
|
(161,663
|
)
|
|
83,187
|
|
|
13,402
|
|
|||
Increase (decrease) in accounts payable and other accrued liabilities
|
2,517,069
|
|
|
476,223
|
|
|
(225,961
|
)
|
|||
Increase (decrease) in income tax liability
|
—
|
|
|
(2,204,626
|
)
|
|
2,204,626
|
|
|||
Increase (decrease) in unearned revenue
|
339,749
|
|
|
(152,777
|
)
|
|
2,884,362
|
|
|||
Net cash provided by operating activities
|
$
|
61,779,104
|
|
|
$
|
48,622,740
|
|
|
$
|
56,791,571
|
|
Investing Activities
|
|
|
|
|
|
||||||
Proceeds from the sale of leased property
|
—
|
|
|
55,553,975
|
|
|
—
|
|
|||
Proceeds from sale of other equity securities
|
—
|
|
|
449,067
|
|
|
7,591,166
|
|
|||
Purchases of property and equipment, net
|
(372,934
|
)
|
|
(105,357
|
)
|
|
(116,595
|
)
|
|||
Proceeds from asset sale
|
7,000
|
|
|
17,999
|
|
|
—
|
|
|||
Principal payment on financing note receivable
|
65,000
|
|
|
236,867
|
|
|
—
|
|
|||
Principal payment on note receivable
|
5,000,000
|
|
|
—
|
|
|
—
|
|
|||
Return of capital on distributions received
|
—
|
|
|
663,939
|
|
|
120,906
|
|
|||
Net cash provided by investing activities
|
$
|
4,699,066
|
|
|
$
|
56,816,490
|
|
|
$
|
7,595,477
|
|
Financing Activities
|
|
|
|
|
|
||||||
Debt financing costs
|
(372,759
|
)
|
|
(264,010
|
)
|
|
(1,462,741
|
)
|
|||
Net offering proceeds on Series A preferred stock
|
—
|
|
|
—
|
|
|
71,161,531
|
|
|||
Cash paid for extinguishment of convertible notes
|
(78,939,743
|
)
|
|
—
|
|
|
—
|
|
|||
Net offering proceeds on convertible debt
|
116,355,125
|
|
|
—
|
|
|
—
|
|
|||
Repurchases of Series A preferred stock
|
(60,550
|
)
|
|
(4,275,553
|
)
|
|
—
|
|
|||
Dividends paid on Series A preferred stock
|
(9,255,121
|
)
|
|
(9,587,500
|
)
|
|
(8,227,734
|
)
|
|||
Dividends paid on common stock
|
(39,100,656
|
)
|
|
(34,284,059
|
)
|
|
(34,731,892
|
)
|
|||
Distributions to non-controlling interest
|
—
|
|
|
—
|
|
|
(1,833,650
|
)
|
|||
Advances on revolving line of credit
|
—
|
|
|
—
|
|
|
10,000,000
|
|
|||
Payments on revolving line of credit
|
—
|
|
|
—
|
|
|
(54,000,000
|
)
|
|||
Proceeds from term debt
|
—
|
|
|
—
|
|
|
41,000,000
|
|
|||
Principal payments on secured credit facilities
|
(3,528,000
|
)
|
|
(3,528,000
|
)
|
|
(45,600,577
|
)
|
|||
Purchase of non-controlling interest
|
—
|
|
|
—
|
|
|
(32,800,000
|
)
|
|||
Net cash used in financing activities
|
$
|
(14,901,704
|
)
|
|
$
|
(51,939,122
|
)
|
|
$
|
(56,495,063
|
)
|
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net Change in Cash and Cash Equivalents
|
$
|
51,576,466
|
|
|
$
|
53,500,108
|
|
|
$
|
7,891,985
|
|
Cash and Cash Equivalents at beginning of period
|
69,287,177
|
|
|
15,787,069
|
|
|
7,895,084
|
|
|||
Cash and Cash Equivalents at end of period
|
$
|
120,863,643
|
|
|
$
|
69,287,177
|
|
|
$
|
15,787,069
|
|
|
|
|
|
|
|
||||||
Supplemental Disclosure of Cash Flow Information
|
|
|
|
|
|
||||||
Interest paid
|
$
|
6,834,439
|
|
|
$
|
11,200,835
|
|
|
$
|
10,780,150
|
|
Income taxes paid (net of refunds)
|
89,433
|
|
|
2,136,563
|
|
|
199,772
|
|
|||
|
|
|
|
|
|
||||||
Non-Cash Investing Activities
|
|
|
|
|
|
||||||
Note receivable in consideration of the sale of leased property
|
$
|
—
|
|
|
$
|
5,000,000
|
|
|
$
|
—
|
|
Investment in other equity securities
|
—
|
|
|
—
|
|
|
(1,161,034
|
)
|
|||
|
|
|
|
|
|
||||||
Non-Cash Financing Activities
|
|
|
|
|
|
|
|
|
|||
Change in accounts payable and accrued expenses related to debt financing costs
|
$
|
—
|
|
|
$
|
(255,037
|
)
|
|
$
|
255,037
|
|
Reinvestment of distributions by common stockholders in additional common shares
|
403,831
|
|
|
1,509,830
|
|
|
962,308
|
|
|||
Common stock issued upon exchange and conversion of convertible notes
|
66,064,966
|
|
|
42,654
|
|
|
—
|
|
|||
See accompanying Notes to Consolidated Financial Statements.
|
•
|
Level 1 - quoted prices in active markets for identical investments
|
•
|
Level 2 - other significant observable inputs (including quoted prices for similar investments, market corroborated inputs, etc.)
|
•
|
Level 3 - significant unobservable inputs (including the Company's own assumptions in determining the fair value of investments)
|
•
|
Lease revenue – Refer to Leased Property and Leases for the Company's lease revenue recognition policy.
|
•
|
Transportation and distribution revenue – The Company's contracts related to transportation and distribution revenue are primarily comprised of a mix of natural gas supply, transportation and distribution performance obligations, as well as limited performance obligations related to system maintenance and improvement. Transportation revenues are recognized by MoGas and distribution revenues are recognized by Omega and Omega Gas Marketing, LLC.
|
◦
|
Under the Company's natural gas supply, transportation and distribution performance obligations, the customer simultaneously receives and consumes the benefit of the services as natural gas is delivered. Therefore, the transaction price is allocated proportionally over the series of identical performance obligations with each contract. The transaction price is calculated based on (i) index price, plus a contractual markup in the case of natural gas supply agreements (considered variable due to fluctuations in the index), (ii) FERC regulated rates or negotiated rates in the case of transportation agreements and (iii) contracted amounts (with annual CPI escalators) in the case of the Company's distribution agreement. Based on the nature of the agreements, revenue for all but one of the Company's natural gas supply, transportation and distribution performance obligations is recognized on a right to invoice basis as the performance obligations are met, which represents what the Company expects to receive in consideration and is representative of value delivered to the customer. The Company has a contract with one customer, Spire, that has fixed pricing which varies over the contract term. For this specific contract, the transaction price has been allocated ratably over the contractual performance obligation beginning in 2018 with the adoption of ASC 606. All invoicing is done in the month following service, with payment typically due a month from invoice date.
|
◦
|
The Company's contracts also contain performance obligations related to system maintenance and improvement, which are completed on an as-needed basis. The work performed is specific and tailored to the customer's needs and there are no alternative uses for the services provided. Therefore, as the work is being completed, control is transferring to the customer. These services are billed at the Company's cost, plus an agreed upon margin, and the Company has an enforceable right to payment as the services are provided. The Company invoices for this service on a monthly basis according to an agreed upon billing schedule. Revenue is recognized on an input method, based on the actual cost of a service as a measure of performance obligations satisfaction, which the Company determined to be the method which faithfully depicts the transfer of services. Differences between the amounts invoiced and revenue recognized under the input method are reflected as an asset or liability on the Consolidated Balance Sheets. Any differences are typically expected to be recognized within a year. As discussed in Note 3 ("Leased Properties And Leases"), the costs of system improvement projects are recognized as a financing arrangement in accordance with guidance in the lease standard while the margin is recognized in accordance with the revenue standard as discussed above.
|
◦
|
Beginning February 1, 2016, due to changes that commenced under a new contract with the Department of Defense ("DOD"), gas sales and cost of gas sales are presented on a net basis in the transportation and distribution revenue
|
•
|
Financing revenue – Historically, financing notes receivable have been considered a core product offering and therefore the related income is presented as a component of operating income. For increasing rate loans, base interest income is recorded ratably over the life of the loan, using the effective interest rate. The net amount of deferred loan origination income and costs are amortized on a straight-line basis over the life of the loan and reported as an adjustment to yield in financing revenue. Participating financing revenues are recorded when specific performance criteria have been met.
|
•
|
Net distributions and other income from investments – Distributions and dividends from investments are recorded on their ex-dates and are reflected as other income within the accompanying Consolidated Statements of Income. Distributions received from the Company's investments are generally characterized as ordinary income, capital gains and distributions received from investment securities. The portion characterized as return of capital is paid by the Company's investees from their cash flow from operations. The Company records investment income, capital gains and distributions received from investment securities based on estimates made at the time such distributions are received. Such estimates are based on information available from each company and other industry sources. These estimates may subsequently be revised based on information received from the entities after their tax reporting periods are concluded, as the actual character of these distributions is not known until after the fiscal year end of the Company.
|
•
|
Net realized and unrealized gain (loss) from investments – Securities transactions are accounted for on the date the securities are purchased or sold. Realized gains and losses are reported on an identified cost basis. The Company records investment income and return of capital based on estimates made at the time such distributions are received. Such estimates are based on information available from the portfolio company and other industry sources. These estimates may subsequently be revised based on information received from the portfolio company after their tax reporting periods are concluded, as the actual character of these distributions are not known until after the Company's fiscal year end.
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Net Deferred Lease Costs
|
|
|
|
||||
GIGS
|
$
|
198,755
|
|
|
$
|
229,319
|
|
Pinedale
|
488,981
|
|
|
550,349
|
|
||
Total Deferred Lease Costs, net
|
$
|
687,736
|
|
|
$
|
779,668
|
|
Balance Sheet
|
|
Balance at December 31, 2018
|
|
Adjustments Due to ASC 842
|
|
Balance at
January 1, 2019 |
||||||
Assets
|
|
|
|
|
|
|
||||||
Prepaid expenses and other assets
|
|
$
|
668,584
|
|
|
$
|
74,534
|
|
|
$
|
743,118
|
|
Liabilities
|
|
|
|
|
|
|
||||||
Accounts payable and other accrued liabilities
|
|
3,493,490
|
|
|
74,534
|
|
|
3,568,024
|
|
|||
Equity
|
|
|
|
|
|
|
||||||
Retained earnings
|
|
9,147,701
|
|
|
—
|
|
|
9,147,701
|
|
|
For the Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Natural gas transportation contracts
|
67.8
|
%
|
|
64.3
|
%
|
|
71.5
|
%
|
Natural gas distribution contracts
|
25.5
|
%
|
|
26.8
|
%
|
|
20.4
|
%
|
Income Tax Expense (Benefit)
|
|||||||||||
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Application of statutory income tax rate
|
$
|
904,111
|
|
|
$
|
8,671,562
|
|
|
$
|
12,231,838
|
|
State income taxes, net of federal tax benefit
|
409,839
|
|
|
(583,186
|
)
|
|
352,708
|
|
|||
Income of Real Estate Investment Trust not subject to tax
|
(941,900
|
)
|
|
(10,339,520
|
)
|
|
(11,975,853
|
)
|
|||
Tax reform impact
|
—
|
|
|
—
|
|
|
1,262,444
|
|
|||
Other
|
(137,432
|
)
|
|
(167,582
|
)
|
|
474,181
|
|
|||
Total income tax expense (benefit)
|
$
|
234,618
|
|
|
$
|
(2,418,726
|
)
|
|
$
|
2,345,318
|
|
2017 Common Stock Tax Information
|
||||||||||||||||||||||||
Record Date
|
|
Ex-Dividend Date
|
|
Payable Date
|
|
Total Distribution per Share
|
|
Total Ordinary Dividends
|
|
Qualified Dividends
|
|
Capital Gain Distributions
|
|
Nondividend Distributions
|
||||||||||
2/13/2017
|
|
2/9/2017
|
|
2/28/2017
|
|
$
|
0.7500
|
|
|
$
|
0.5925
|
|
|
$
|
0.0785
|
|
|
$
|
—
|
|
|
$
|
0.1575
|
|
5/16/2017
|
|
5/12/2017
|
|
5/31/2017
|
|
0.7500
|
|
|
0.5925
|
|
|
0.0785
|
|
|
—
|
|
|
0.1575
|
|
|||||
8/17/2017
|
|
8/15/2017
|
|
8/31/2017
|
|
0.7500
|
|
|
0.5925
|
|
|
0.0785
|
|
|
—
|
|
|
0.1575
|
|
|||||
11/15/2017
|
|
11/14/2017
|
|
11/30/2017
|
|
0.7500
|
|
|
0.5925
|
|
|
0.0785
|
|
|
—
|
|
|
0.1575
|
|
|||||
Total 2017 Distributions
|
|
$
|
3.0000
|
|
|
$
|
2.3700
|
|
|
$
|
0.3140
|
|
|
$
|
—
|
|
|
$
|
0.6300
|
|
2017 Preferred Stock Tax Information
|
||||||||||||||||||||||||
Record Date
|
|
Ex-Dividend Date
|
|
Payable Date
|
|
Total Distribution per Share
|
|
Total Ordinary Dividends
|
|
Qualified Dividends
|
|
Capital Gain Distributions
|
|
Nondividend Distributions
|
||||||||||
02/13/2017
|
|
2/9/2017
|
|
2/28/2017
|
|
$
|
0.4609
|
|
|
$
|
0.4609
|
|
|
$
|
0.0611
|
|
|
$
|
—
|
|
|
$
|
—
|
|
05/16/2017
|
|
5/12/2017
|
|
5/31/2017
|
|
0.4609
|
|
|
0.4609
|
|
|
0.0611
|
|
|
—
|
|
|
—
|
|
|||||
8/17/2017
|
|
8/15/2017
|
|
8/31/2017
|
|
0.4609
|
|
|
0.4609
|
|
|
0.0611
|
|
|
—
|
|
|
—
|
|
|||||
11/15/2017
|
|
11/14/2017
|
|
11/30/2017
|
|
0.4609
|
|
|
0.4609
|
|
|
0.0611
|
|
|
—
|
|
|
—
|
|
|||||
Total 2017 Distributions
|
|
$
|
1.8436
|
|
|
$
|
1.8436
|
|
|
$
|
0.2444
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Property and Equipment
|
|||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
Land
|
$
|
605,070
|
|
|
$
|
580,000
|
|
Natural gas pipeline
|
124,614,696
|
|
|
124,306,175
|
|
||
Vehicles and trailers
|
671,962
|
|
|
696,164
|
|
||
Office equipment and computers
|
268,559
|
|
|
268,559
|
|
||
Gross property and equipment
|
$
|
126,160,287
|
|
|
$
|
125,850,898
|
|
Less: accumulated depreciation
|
(19,304,610
|
)
|
|
(15,969,346
|
)
|
||
Net property and equipment
|
$
|
106,855,677
|
|
|
$
|
109,881,552
|
|
•
|
During the year ended December 31, 2017, the Manager voluntarily recommended, and the Company agreed, that the Manager would waive $100 thousand of the total $595 thousand incentive fee that would otherwise be payable under the provisions of the Management Agreement with respect to dividends paid on the Company's common stock.
|
•
|
In order to ensure equitable application of the quarterly management fee provisions of the Management Agreement for the acquisition of Prudential's minority limited partner interest in Pinedale LP, which closed on December 29, 2017, the Manager waived any incremental management fee due as of the end of the fourth quarter of 2017 based on the net impact of the Pinedale LP acquisition.
|
•
|
During the year ended December 31, 2019, the Manager voluntarily recommended, and the Company agreed, that the Manager would waive $470 thousand of the total $658 thousand incentive fee that would otherwise be payable under the provisions of the Management Agreement with respect to dividends paid on the Company's common stock.
|
•
|
In reviewing the application of the quarterly management fee provisions of the Management Agreement to the net proceeds received during the third quarter of 2019 from the offering of 5.875% Convertible Notes, which closed on August 12, 2019,
|
Level 3 Rollforward
|
||||||||||||||||||||||||||||
For the Year Ended 2018
|
|
Fair Value Beginning Balance
|
|
Acquisitions
|
|
Disposals
|
|
Total Realized and Unrealized Losses Included in Net Income
|
|
Return of Capital Adjustments Impacting Cost Basis of Securities
|
|
Fair Value Ending Balance
|
|
Changes in Unrealized Losses Included In Net Income, Relating to Securities Still Held
|
||||||||||||||
Other equity securities
|
|
$
|
2,958,315
|
|
|
$
|
—
|
|
|
$
|
(449,067
|
)
|
|
$
|
(1,845,309
|
)
|
|
$
|
(663,939
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Total
|
|
$
|
2,958,315
|
|
|
$
|
—
|
|
|
$
|
(449,067
|
)
|
|
$
|
(1,845,309
|
)
|
|
$
|
(663,939
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Total Commitment
or Original Principal
|
|
Quarterly Principal Payments
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||
|
|
|
Maturity
Date
|
|
Amount Outstanding
|
|
Interest
Rate |
|
Amount Outstanding
|
|
Interest
Rate |
||||||||||||
CorEnergy Secured Credit Facility:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CorEnergy Revolver
|
$
|
160,000,000
|
|
|
$
|
—
|
|
|
7/28/2022
|
|
$
|
—
|
|
|
4.51
|
%
|
|
$
|
—
|
|
|
5.25
|
%
|
MoGas Revolver
|
1,000,000
|
|
|
—
|
|
|
7/28/2022
|
|
—
|
|
|
4.51
|
%
|
|
—
|
|
|
5.25
|
%
|
||||
Omega Line of Credit
|
1,500,000
|
|
|
—
|
|
|
7/31/2020
|
|
—
|
|
|
5.76
|
%
|
|
—
|
|
|
6.50
|
%
|
||||
Pinedale Secured Credit Facility:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Amended Pinedale Term Credit Facility
|
41,000,000
|
|
|
882,000
|
|
|
12/29/2022
|
|
33,944,000
|
|
|
6.50
|
%
|
|
37,472,000
|
|
|
6.50
|
%
|
||||
7.00% Unsecured Convertible Senior Notes
|
115,000,000
|
|
|
—
|
|
|
6/15/2020
|
|
2,092,000
|
|
|
7.00
|
%
|
|
113,958,000
|
|
|
7.00
|
%
|
||||
5.875% Unsecured Convertible Senior Notes
|
120,000,000
|
|
|
—
|
|
|
8/15/2025
|
|
120,000,000
|
|
|
5.875
|
%
|
|
—
|
|
|
—
|
%
|
||||
Total Debt
|
|
$
|
156,036,000
|
|
|
|
|
$
|
151,430,000
|
|
|
|
|||||||||||
Less:
|
|
|
|
|
|
|
|
|
|||||||||||||||
Unamortized deferred financing costs (1)
|
|
$
|
635,351
|
|
|
|
|
$
|
283,278
|
|
|
|
|||||||||||
Unamortized discount on 7.00% Convertible Senior Notes
|
|
6,681
|
|
|
|
|
1,108,342
|
|
|
|
|||||||||||||
Unamortized discount on 5.875% Convertible Senior Notes
|
|
3,284,542
|
|
|
|
|
—
|
|
|
|
|||||||||||||
Long-term debt, net of deferred financing costs
|
|
$
|
152,109,426
|
|
|
|
|
$
|
150,038,380
|
|
|
|
|||||||||||
Debt due within one year
|
|
$
|
5,612,178
|
|
|
|
|
$
|
3,528,000
|
|
|
|
|||||||||||
(1) Unamortized deferred financing costs related to the Company's revolving credit facilities are included in Deferred Costs in the Assets section of the Consolidated Balance Sheets. Refer to the "Deferred Financing Costs" paragraph below.
|
Deferred Financing Cost Amortization Expense (1)(2)
|
|||||||||||
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
CorEnergy Credit Facility
|
$
|
574,542
|
|
|
$
|
574,541
|
|
|
$
|
873,601
|
|
Amended Pinedale Term Credit Facility
|
52,821
|
|
|
52,728
|
|
|
392
|
|
|||
Total Deferred Debt Cost Amortization
|
$
|
627,363
|
|
|
$
|
627,269
|
|
|
$
|
873,993
|
|
(1) Amortization of deferred debt issuance costs is included in interest expense in the Consolidated Statements of Income.
|
|||||||||||
(2) For the amount of deferred debt costs amortization relating to the Convertible Notes included in the Consolidated Statements of Income, refer to the Convertible Note Interest Expense table below.
|
Year
|
|
Amended Pinedale Term Credit Facility
|
||
2020
|
|
$
|
3,528,000
|
|
2021
|
|
3,528,000
|
|
|
2022
|
|
26,888,000
|
|
|
2023
|
|
—
|
|
|
2024
|
|
—
|
|
|
Thereafter
|
|
—
|
|
|
Total
|
|
$
|
33,944,000
|
|
Convertible Note Interest Expense
|
|||||||||||
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
7.00% Convertible Notes:
|
|
|
|
|
|
||||||
Interest Expense
|
$
|
3,354,178
|
|
|
$
|
7,979,118
|
|
|
$
|
7,980,000
|
|
Discount Amortization
|
320,821
|
|
|
738,912
|
|
|
738,912
|
|
|||
Deferred Debt Issuance Cost Amortization
|
21,004
|
|
|
48,276
|
|
|
48,276
|
|
|||
Total 7.00% Convertible Notes
|
$
|
3,696,003
|
|
|
$
|
8,766,306
|
|
|
$
|
8,767,188
|
|
|
|
|
|
|
|
||||||
5.875% Convertible Notes:
|
|
|
|
|
|
||||||
Interest Expense
|
$
|
2,722,083
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Discount Amortization
|
225,458
|
|
|
—
|
|
|
—
|
|
|||
Deferred Debt Issuance Amortization
|
31,493
|
|
|
—
|
|
|
—
|
|
|||
Total 5.875% Convertible Notes
|
$
|
2,979,034
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Convertible Note Interest
|
$
|
6,675,037
|
|
|
$
|
8,766,306
|
|
|
$
|
8,767,188
|
|
Asset Retirement Obligation
|
|||||||
|
For the Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Beginning asset retirement obligation
|
$
|
7,956,343
|
|
|
$
|
9,170,493
|
|
Liabilities assumed
|
—
|
|
|
—
|
|
||
ARO accretion expense
|
443,969
|
|
|
499,562
|
|
||
Liabilities settled
|
—
|
|
|
(628,300
|
)
|
||
Revision in cash flow estimates
|
(356,112
|
)
|
|
(1,085,412
|
)
|
||
Ending asset retirement obligation
|
$
|
8,044,200
|
|
|
$
|
7,956,343
|
|
|
For the Fiscal 2019 Quarters Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Lease revenue
|
$
|
16,717,710
|
|
|
$
|
16,635,876
|
|
|
$
|
16,984,903
|
|
|
$
|
16,712,017
|
|
Transportation and distribution revenue
|
4,871,582
|
|
|
4,868,144
|
|
|
4,068,338
|
|
|
4,970,173
|
|
||||
Financing revenue
|
33,540
|
|
|
27,989
|
|
|
28,003
|
|
|
27,295
|
|
||||
Total Revenue
|
21,622,832
|
|
|
21,532,009
|
|
|
21,081,244
|
|
|
21,709,485
|
|
||||
Expenses
|
|
|
|
|
|
|
|
||||||||
Transportation and distribution expenses
|
1,503,143
|
|
|
1,246,755
|
|
|
1,116,194
|
|
|
1,376,152
|
|
||||
General and administrative
|
2,870,407
|
|
|
2,739,855
|
|
|
2,494,240
|
|
|
2,492,346
|
|
||||
Depreciation, amortization and ARO accretion expense
|
5,645,096
|
|
|
5,645,250
|
|
|
5,645,342
|
|
|
5,646,254
|
|
||||
Total Expenses
|
10,018,646
|
|
|
9,631,860
|
|
|
9,255,776
|
|
|
9,514,752
|
|
||||
Operating Income
|
$
|
11,604,186
|
|
|
$
|
11,900,149
|
|
|
$
|
11,825,468
|
|
|
$
|
12,194,733
|
|
Other Income (Expense)
|
|
|
|
|
|
|
|
||||||||
Net distributions and other income
|
$
|
256,615
|
|
|
$
|
285,259
|
|
|
$
|
360,182
|
|
|
$
|
426,797
|
|
Interest expense
|
(2,507,294
|
)
|
|
(2,297,783
|
)
|
|
(2,777,122
|
)
|
|
(2,996,512
|
)
|
||||
Loss on extinguishment of debt
|
(5,039,731
|
)
|
|
—
|
|
|
(28,920,834
|
)
|
|
—
|
|
||||
Total Other Expense
|
(7,290,410
|
)
|
|
(2,012,524
|
)
|
|
(31,337,774
|
)
|
|
(2,569,715
|
)
|
||||
Income (loss) before income taxes
|
4,313,776
|
|
|
9,887,625
|
|
|
(19,512,306
|
)
|
|
9,625,018
|
|
||||
Taxes
|
|
|
|
|
|
|
|
||||||||
Current tax expense (benefit)
|
353,744
|
|
|
—
|
|
|
(1,270
|
)
|
|
(472,498
|
)
|
||||
Deferred tax expense (benefit)
|
93,591
|
|
|
62,699
|
|
|
(91,436
|
)
|
|
289,788
|
|
||||
Income tax expense (benefit), net
|
447,335
|
|
|
62,699
|
|
|
(92,706
|
)
|
|
(182,710
|
)
|
||||
Net income (loss) attributable to CorEnergy Stockholders
|
$
|
3,866,441
|
|
|
$
|
9,824,926
|
|
|
$
|
(19,419,600
|
)
|
|
$
|
9,807,728
|
|
Preferred dividend requirements
|
2,314,128
|
|
|
2,313,780
|
|
|
2,313,780
|
|
|
2,313,780
|
|
||||
Net income (loss) attributable to Common Stockholders
|
$
|
1,552,313
|
|
|
$
|
7,511,146
|
|
|
$
|
(21,733,380
|
)
|
|
$
|
7,493,948
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) Per Common Share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.12
|
|
|
$
|
0.59
|
|
|
$
|
(1.65
|
)
|
|
$
|
0.55
|
|
Diluted
|
$
|
0.12
|
|
|
$
|
0.59
|
|
|
$
|
(1.65
|
)
|
|
$
|
0.55
|
|
|
For the Fiscal 2018 Quarters Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Lease revenue
|
$
|
17,591,859
|
|
|
$
|
18,275,859
|
|
|
$
|
18,391,983
|
|
|
$
|
18,487,661
|
|
Transportation and distribution revenue
|
3,952,979
|
|
|
3,874,157
|
|
|
4,244,722
|
|
|
4,412,378
|
|
||||
Total Revenue
|
21,544,838
|
|
|
22,150,016
|
|
|
22,636,705
|
|
|
22,900,039
|
|
||||
Expenses
|
|
|
|
|
|
|
|
||||||||
Transportation and distribution expenses
|
1,572,896
|
|
|
1,534,524
|
|
|
2,241,999
|
|
|
1,861,329
|
|
||||
General and administrative
|
2,727,057
|
|
|
3,107,776
|
|
|
3,046,481
|
|
|
4,161,533
|
|
||||
Depreciation, amortization and ARO accretion expense
|
6,289,330
|
|
|
6,290,082
|
|
|
6,289,459
|
|
|
6,078,582
|
|
||||
Provision for loan (gain) loss
|
500,000
|
|
|
—
|
|
|
—
|
|
|
(536,867
|
)
|
||||
Total Expenses
|
11,089,283
|
|
|
10,932,382
|
|
|
11,577,939
|
|
|
11,564,577
|
|
||||
Operating Income
|
$
|
10,455,555
|
|
|
$
|
11,217,634
|
|
|
$
|
11,058,766
|
|
|
$
|
11,335,462
|
|
Other Income (Expense)
|
|
|
|
|
|
|
|
||||||||
Net distributions and other income
|
$
|
3,951
|
|
|
$
|
55,714
|
|
|
$
|
5,627
|
|
|
$
|
41,503
|
|
Net realized and unrealized gain (loss) on other equity securities
|
13,966
|
|
|
(881,100
|
)
|
|
(930,147
|
)
|
|
(48,028
|
)
|
||||
Interest expense
|
(3,210,590
|
)
|
|
(3,196,248
|
)
|
|
(3,183,589
|
)
|
|
(3,168,583
|
)
|
||||
Gain on the sale of leased property, net
|
—
|
|
|
—
|
|
|
—
|
|
|
11,723,257
|
|
||||
Total Other Income (Expense)
|
(3,192,673
|
)
|
|
(4,021,634
|
)
|
|
(4,108,109
|
)
|
|
8,548,149
|
|
||||
Income before income taxes
|
7,262,882
|
|
|
7,196,000
|
|
|
6,950,657
|
|
|
19,883,611
|
|
||||
Taxes
|
|
|
|
|
|
|
|
||||||||
Current tax benefit
|
(35,549
|
)
|
|
(10,785
|
)
|
|
(8,393
|
)
|
|
(530,659
|
)
|
||||
Deferred tax benefit
|
(409,277
|
)
|
|
(604,064
|
)
|
|
(738,274
|
)
|
|
(81,725
|
)
|
||||
Income tax benefit, net
|
(444,826
|
)
|
|
(614,849
|
)
|
|
(746,667
|
)
|
|
(612,384
|
)
|
||||
Net Income attributable to CorEnergy Stockholders
|
$
|
7,707,708
|
|
|
$
|
7,810,849
|
|
|
$
|
7,697,324
|
|
|
$
|
20,495,995
|
|
Preferred dividend requirements
|
2,396,875
|
|
|
2,396,875
|
|
|
2,396,875
|
|
|
2,357,752
|
|
||||
Net Income attributable to Common Stockholders
|
$
|
5,310,833
|
|
|
$
|
5,413,974
|
|
|
$
|
5,300,449
|
|
|
$
|
18,138,243
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings Per Common Share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.45
|
|
|
$
|
0.45
|
|
|
$
|
0.44
|
|
|
$
|
1.52
|
|
Diluted
|
$
|
0.45
|
|
|
$
|
0.45
|
|
|
$
|
0.44
|
|
|
$
|
1.32
|
|
CONDENSED BALANCE SHEETS
|
December 31, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
||||
Leased property, net of accumulated depreciation of $1,296,598 and $1,112,218
|
$
|
3,497,058
|
|
|
$
|
3,681,438
|
|
Investments
|
401,331,625
|
|
|
415,674,601
|
|
||
Cash and cash equivalents
|
113,264,989
|
|
|
64,574,701
|
|
||
Due from subsidiary
|
11,635,874
|
|
|
10,549,719
|
|
||
Note receivable from subsidiary
|
75,412,500
|
|
|
81,000,000
|
|
||
Deferred costs, net of accumulated amortization of $1,198,023 and $712,182
|
1,283,744
|
|
|
1,769,585
|
|
||
Prepaid expenses and other assets
|
306,939
|
|
|
265,024
|
|
||
Total Assets
|
$
|
606,732,729
|
|
|
$
|
577,515,068
|
|
Liabilities and Equity
|
|
|
|
||||
Unsecured convertible senior notes, net of discount and debt issuance costs of $3,768,504 and $1,180,729
|
118,323,496
|
|
|
112,777,271
|
|
||
Accounts payable and other accrued liabilities
|
3,180,010
|
|
|
1,075,045
|
|
||
Management fees payable
|
1,669,950
|
|
|
1,831,613
|
|
||
Due to affiliate
|
153,640
|
|
|
153,640
|
|
||
Total Liabilities
|
$
|
123,327,096
|
|
|
$
|
115,837,569
|
|
Equity
|
|
|
|
||||
Series A Cumulative Redeemable Preferred Stock 7.375%, $125,493,175 and $125,555,675 liquidation preference ($2,500 per share, $0.001 par value), 10,000,000 authorized; 50,197 and 50,222 issued and outstanding at December 31, 2019 and December 31, 2018, respectively
|
$
|
125,493,175
|
|
|
$
|
125,555,675
|
|
Capital stock, non-convertible, $0.001 par value; 13,638,916 and 11,960,225 shares issued and outstanding at December 31, 2019 and December 31, 2018 (100,000,000 shares authorized)
|
13,639
|
|
|
11,960
|
|
||
Additional paid-in capital
|
367,510,691
|
|
|
326,962,163
|
|
||
Retained earnings (deficit)
|
(9,611,872
|
)
|
|
9,147,701
|
|
||
Total Equity
|
483,405,633
|
|
|
461,677,499
|
|
||
Total Liabilities and Equity
|
$
|
606,732,729
|
|
|
$
|
577,515,068
|
|
See accompanying Schedule I Notes to Condensed Financial Statements.
|
CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenue
|
|
|
|
|
|
||||||
Earnings from subsidiary
|
$
|
41,073,290
|
|
|
$
|
48,353,177
|
|
|
$
|
36,222,221
|
|
Total Revenue
|
41,073,290
|
|
|
48,353,177
|
|
|
36,222,221
|
|
|||
Expenses
|
|
|
|
|
|
||||||
General and administrative
|
2,045,404
|
|
|
2,353,593
|
|
|
2,298,201
|
|
|||
Depreciation expense
|
184,380
|
|
|
184,380
|
|
|
184,380
|
|
|||
Amortization expense
|
5,316
|
|
|
5,316
|
|
|
5,316
|
|
|||
Total Expenses
|
2,235,100
|
|
|
2,543,289
|
|
|
2,487,897
|
|
|||
Operating Income
|
$
|
38,838,190
|
|
|
$
|
45,809,888
|
|
|
$
|
33,734,324
|
|
Other Income (Expense)
|
|
|
|
|
|
||||||
Net distributions and other income
|
$
|
1,252,749
|
|
|
$
|
56,827
|
|
|
$
|
96,866
|
|
Interest on loans to subsidiaries
|
5,916,317
|
|
|
7,903,104
|
|
|
11,549,344
|
|
|||
Interest expense, net
|
(7,967,196
|
)
|
|
(10,057,943
|
)
|
|
(11,451,944
|
)
|
|||
Loss on extinguishment of debt
|
(33,960,565
|
)
|
|
—
|
|
|
(225,801
|
)
|
|||
Total Other Expense
|
(34,758,695
|
)
|
|
(2,098,012
|
)
|
|
(31,535
|
)
|
|||
Net Income
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
33,702,789
|
|
|
|
|
|
|
|
||||||
Other comprehensive income:
|
|
|
|
|
|
||||||
Changes in fair value of qualifying hedges
|
—
|
|
|
—
|
|
|
11,196
|
|
|||
Total Comprehensive Income
|
$
|
4,079,495
|
|
|
$
|
43,711,876
|
|
|
$
|
33,713,985
|
|
See accompanying Schedule I Notes to Condensed Financial Statements.
|
CONDENSED STATEMENTS OF CASH FLOW
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net cash provided by (used in) operating activities
|
$
|
(939,775
|
)
|
|
$
|
(6,257,124
|
)
|
|
$
|
1,661,123
|
|
Investing Activities
|
|
|
|
|
|
||||||
Principal payments received from notes to subsidiaries
|
5,587,500
|
|
|
2,250,000
|
|
|
40,092,095
|
|
|||
Investment in consolidated subsidiaries
|
—
|
|
|
(73,996
|
)
|
|
(33,900,000
|
)
|
|||
Cash distributions from consolidated subsidiaries
|
55,416,267
|
|
|
110,140,459
|
|
|
46,774,111
|
|
|||
Net cash provided by investing activities
|
$
|
61,003,767
|
|
|
$
|
112,316,463
|
|
|
$
|
52,966,206
|
|
Financing Activities
|
|
|
|
|
|
||||||
Debt financing costs
|
(372,759
|
)
|
|
—
|
|
|
(1,360,241
|
)
|
|||
Net offering proceeds on Series A preferred stock
|
—
|
|
|
—
|
|
|
71,161,531
|
|
|||
Net offering proceeds on convertible debt
|
116,355,125
|
|
|
—
|
|
|
—
|
|
|||
Cash paid for extinguishment of convertible debt
|
(78,939,743
|
)
|
|
—
|
|
|
—
|
|
|||
Repurchases of preferred stock debt
|
(60,550
|
)
|
|
(4,275,553
|
)
|
|
—
|
|
|||
Dividends paid on Series A preferred stock
|
(9,255,121
|
)
|
|
(9,587,500
|
)
|
|
(8,227,734
|
)
|
|||
Dividends paid on common stock
|
(39,100,656
|
)
|
|
(34,284,059
|
)
|
|
(34,731,892
|
)
|
|||
Advances on revolving line of credit
|
—
|
|
|
—
|
|
|
10,000,000
|
|
|||
Payments on revolving line of credit
|
—
|
|
|
—
|
|
|
(54,000,000
|
)
|
|||
Principal payments on term debt
|
—
|
|
|
—
|
|
|
(36,740,000
|
)
|
|||
Net cash used in financing activities
|
$
|
(11,373,704
|
)
|
|
$
|
(48,147,112
|
)
|
|
$
|
(53,898,336
|
)
|
Net Change in Cash and Cash Equivalents
|
$
|
48,690,288
|
|
|
$
|
57,912,227
|
|
|
$
|
728,993
|
|
Cash and Cash Equivalents at beginning of period
|
64,574,701
|
|
|
6,662,474
|
|
|
5,933,481
|
|
|||
Cash and Cash Equivalents at end of period
|
$
|
113,264,989
|
|
|
$
|
64,574,701
|
|
|
$
|
6,662,474
|
|
|
|
|
|
|
|
||||||
Supplemental Disclosure of Cash Flow Information
|
|
|
|
|
|
||||||
Interest Paid
|
$
|
4,504,263
|
|
|
$
|
8,794,086
|
|
|
$
|
10,080,764
|
|
Non-Cash Investing Activities
|
|
|
|
|
|
||||||
Conversion of note receivable from subsidiary to investments
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,902,495
|
|
Dissolution of investment in subsidiary upon liquidation
|
—
|
|
|
(73,996
|
)
|
|
—
|
|
|||
Non-Cash Financing Activities
|
|
|
|
|
|
||||||
Common stock issued upon exchange and conversion of convertible notes
|
$
|
66,064,966
|
|
|
$
|
42,654
|
|
|
$
|
—
|
|
Reinvestment of distributions by common stockholders in additional common shares
|
403,831
|
|
|
1,509,830
|
|
|
962,308
|
|
|||
See accompanying Schedule I Notes to Condensed Financial Statements.
|
|
|
|
|
|
|
Initial Cost to Company
|
|
Costs Capitalized Subsequent to Acquisition
|
|
Gross Amount Carried at Close of Period December 31, 2019
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Description
|
|
Location
|
|
Encumbrances
|
|
Land
|
|
Building & Fixtures
|
|
Improvements / Adjustments (4)
|
|
Land
|
|
Building & Fixtures
|
|
Total
|
|
Accumulated Depreciation
|
|
Investment in Real Estate, net, at 12/31/19
|
|
Date Acquired
|
|
Life on which depreciation in latest income statement is computed
|
||||||||||||||||||
Pinedale LGS (1)(5)
|
|
Pinedale, WY
|
|
$
|
33,944,000
|
|
|
$
|
105,485,063
|
|
|
$
|
125,119,062
|
|
|
$
|
—
|
|
|
$
|
105,485,063
|
|
|
$
|
125,119,062
|
|
|
$
|
230,604,125
|
|
|
$
|
62,370,978
|
|
|
$
|
168,233,147
|
|
|
2012
|
|
26 years
|
United Property Systems (4)
|
|
St. Louis, MO
|
|
—
|
|
|
210,000
|
|
|
1,188,000
|
|
|
103,497
|
|
|
210,000
|
|
|
1,291,497
|
|
|
1,501,497
|
|
|
177,214
|
|
|
1,324,283
|
|
|
2014
|
|
40 years
|
|||||||||
Grand Isle Gathering System (2)(3)(4)
|
|
Gulf of Mexico
|
|
—
|
|
|
960,000
|
|
|
258,471,397
|
|
|
(6,499,804
|
)
|
|
960,000
|
|
|
251,971,593
|
|
|
252,931,593
|
|
|
43,277,624
|
|
|
209,653,969
|
|
|
2015
|
|
27 years
|
|||||||||
|
|
|
|
$
|
33,944,000
|
|
|
$
|
106,655,063
|
|
|
$
|
384,778,459
|
|
|
$
|
(6,396,307
|
)
|
|
$
|
106,655,063
|
|
|
$
|
378,382,152
|
|
|
$
|
485,037,215
|
|
|
$
|
105,825,816
|
|
|
$
|
379,211,399
|
|
|
|
|
|
(1) In connection with the asset acquisition, CorEnergy and Pinedale LP incurred acquisition costs of $2,557,910, which are included in the total asset balance.
|
||||||||||||||||||||||||||||||||||||||||||
(2) In connection with the asset acquisition, Grand Isle Gathering System incurred acquisition costs of $1,931,396, which are included in the total asset balance.
|
||||||||||||||||||||||||||||||||||||||||||
(3) Initial costs associated with the GIGS asset include amounts capitalized related to an acquired asset retirement obligation (ARO). The negative subsequent adjustment relates to (i) downward revisions of the ARO based on periodic reevaluation as required under FASB ASC 410-20 and (ii) the settlement of a portion of the ARO when a segment of the GIGS pipeline system was decommissioned during the fourth quarter of 2018.
|
||||||||||||||||||||||||||||||||||||||||||
(4) These two properties serve as collateral under the CorEnergy Credit Facility. There are no amounts outstanding on the credit facility as of December 31, 2019.
|
||||||||||||||||||||||||||||||||||||||||||
(5) The amount outstanding for the Amended Pinedale Term Credit Facility is $33,944,000 as of December 31, 2019.
|
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Investment in real estate:
|
|
|
|
|
|
||||||
Balance, beginning of year
|
$
|
485,368,450
|
|
|
$
|
538,112,220
|
|
|
$
|
541,478,086
|
|
Addition: Acquisitions and developments
|
24,877
|
|
|
3,599
|
|
|
9,649
|
|
|||
Deduction: Dispositions and other(1)(2)
|
(356,112
|
)
|
|
(52,747,369
|
)
|
|
(3,375,515
|
)
|
|||
Balance, end of year
|
$
|
485,037,215
|
|
|
$
|
485,368,450
|
|
|
$
|
538,112,220
|
|
Accumulated depreciation:
|
|
|
|
|
|
||||||
Balance, beginning of year
|
$
|
87,154,095
|
|
|
$
|
72,155,753
|
|
|
$
|
52,219,717
|
|
Addition: Depreciation
|
18,671,721
|
|
|
20,986,461
|
|
|
19,936,036
|
|
|||
Deduction: Dispositions and other(2)
|
—
|
|
|
(5,988,119
|
)
|
|
—
|
|
|||
Balance, end of year
|
$
|
105,825,816
|
|
|
$
|
87,154,095
|
|
|
$
|
72,155,753
|
|
(1) The Grand Isle Gathering System had a change in estimate related to the ARO in 2019, 2018 and 2017. Refer to Note 12 ("Asset Retirement Obligation") for further details.
|
|||||||||||
(2) On December 21, 2018, the Company sold its Portland Terminal Facility with a net carrying value of $45.7 million (i.e. gross investment of $51.7 million less accumulated depreciation of $6.0 million). Refer to Note 3 ("Leased Properties and Leases") for further details.
|
Description
|
|
Interest Rate
|
|
Final Maturity
|
|
Monthly Payment Amount
|
|
Prior Liens
|
|
Face Value
|
|
Carrying Amount of Mortgage
|
|
Principal Amount of Loans Subject to Delinquent Principal or Interest
|
||||||||
First Mortgages
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Billings, Dunn and McKenzie Counties, North Dakota (Morlock Well)
|
|
8.50%
|
|
6/30/2021
|
|
$
|
10,833
|
|
|
None
|
|
$
|
1,300,000
|
|
|
$
|
1,235,000
|
|
|
$
|
—
|
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
1,300,000
|
|
|
$
|
1,235,000
|
|
|
$
|
—
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Beginning balance
|
$
|
1,300,000
|
|
|
$
|
1,500,000
|
|
|
$
|
1,500,000
|
|
Additions:
|
|
|
|
|
|
||||||
New loans
|
—
|
|
|
—
|
|
|
—
|
|
|||
Interest receivable
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total Additions
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Deductions:
|
|
|
|
|
|
||||||
Principal repayments(1)
|
$
|
65,000
|
|
|
$
|
236,867
|
|
|
$
|
—
|
|
Foreclosures
|
—
|
|
|
—
|
|
|
—
|
|
|||
Amortization of deferred costs
|
—
|
|
|
—
|
|
|
—
|
|
|||
Principal, Interest and Deferred Costs Write Up(1)
|
—
|
|
|
(36,867
|
)
|
|
—
|
|
|||
Total deductions
|
$
|
65,000
|
|
|
$
|
200,000
|
|
|
$
|
—
|
|
Ending balance
|
$
|
1,235,000
|
|
|
$
|
1,300,000
|
|
|
$
|
1,500,000
|
|
(1) In 2018, Four Wood Corridor and Compass SWD executed a $1.3 million loan agreement and Compass SWD paid approximately $237 thousand in cash for assets secured by the previous $1.5 million loans. As a result, SWD Enterprises was released from the terms of its loans, and the Company recognized a provision for loan gain of $37 thousand in the Consolidated Statements of Income. Refer to Note 5 ("Financing Notes Receivable") for further details.
|
CORENERGY INFRASTRUCTURE TRUST, INC.
|
||
|
|
(Registrant)
|
|
|
|
By:
|
|
/s/ Kristin M. Leitze
|
|
|
Kristin M. Leitze
|
|
|
Chief Accounting Officer (Principal Accounting and Principal Financial Officer)
|
SIGNATURE
|
|
TITLE
|
DATE
|
/s/ David J. Schulte
|
|
Chairman and Chief Executive Officer (Principal Executive Officer)
|
February 27, 2020
|
David J. Schulte
|
|
|
|
|
|
|
|
/s/ Kristin M. Leitze
|
|
Chief Accounting Officer (Principal Accounting and Principal Financial Officer)
|
February 27, 2020
|
Kristin M. Leitze
|
|
|
|
|
|
|
|
/s/ Todd Banks
|
|
Director
|
February 27, 2020
|
Todd Banks
|
|
|
|
|
|
|
|
/s/ Barrett Brady
|
|
Director
|
February 27, 2020
|
Barrett Brady
|
|
|
|
|
|
|
|
/s/ Conrad S. Ciccotello
|
|
Director
|
February 27, 2020
|
Conrad S. Ciccotello
|
|
|
|
|
|
|
|
/s/ Catherine A. Lewis
|
|
Director
|
February 27, 2020
|
Catherine A. Lewis
|
|
|
|
1 Year CorEnergy Infrastructure Chart |
1 Month CorEnergy Infrastructure Chart |
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