Adrienne Saunders

General Counsel

c/o Stonepeak Infrastructure Partners

 717 Fifth Avenue, 25th Floor

New York, NY 10022

 (Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [  ]

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See Rule 13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page.

The information required in the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 3 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	STONEPEAK CATARINA UPPER HOLDINGS LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	OO, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 4 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	STONEPEAK INFRASTRUCTURE FUND (ORION AIV) LP
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	PN, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 5 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	STONEPEAK ASSOCIATES LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	OO, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 6 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	STONEPEAK GP HOLDINGS LP
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	PN, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 7 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	STONEPEAK GP INVESTORS LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	OO, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 8 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	STONEPEAK GP INVESTORS MANAGER LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	OO, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 9 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	MICHAEL DORRELL
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	United States of America
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	IN, HC

 

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SCHEDULE 13D

 

CUSIP No: 79971C201

Page 10 of 19 Pages

 

1	NAMES OF REPORTING PERSONS
	TRENT VICHIE
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
	(a) ☐ (b) ☐
3	SEC USE ONLY
4	SOURCE OF FUNDS (SEE INSTRUCTIONS)
	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(D) OR 2(E)
	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION
	United States of America
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER
			0
		8	SHARED VOTING POWER
			19,444,445
		9	SOLE DISPOSITIVE POWER
			0
		10	SHARED DISPOSITIVE POWER
			19,444,445
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
	19,444,445
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
	86.1%
14	TYPE OF REPORTING PERSON
	IN, HC

 

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SCHEDULE 13D

 

Page 11 of 19 Pages

 

This Schedule 13D relates to Class B Preferred Units (“Preferred Units”) held for the account of Stonepeak Catarina Holdings LLC.  Stonepeak Catarina Upper Holdings LLC is the managing member of Stonepeak Catarina Holdings LLC.  Stonepeak Infrastructure Fund (Orion AIV) LP is the managing member of Stonepeak Catarina Upper Holdings LLC.  Stonepeak Associates LLC is the general partner of Stonepeak Infrastructure Fund (Orion AIV) LP.  Stonepeak GP Holdings LP is the sole member of Stonepeak Associates LLC.  Stonepeak GP Investors LLC is the general partner of Stonepeak GP Holdings LP.  Stonepeak GP Investors Manager LLC is the managing member of Stonepeak GP Investors LLC.  Each of Mr. Dorrell and Mr. Vichie serve as a managing member of Stonepeak GP Investors Manager LLC.

The address of the principal office for each of the Reporting Persons is 717 Fifth Avenue, 25th Floor, New York, New York 10022.

The agreement among each of the Reporting Persons to file this Schedule 13D jointly in accordance with Rule 13d-1(k) of the Exchange Act is attached hereto as Exhibit A.

(d) None of the Reporting Persons has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

 

(e) None of the Reporting Persons has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

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this Schedule 13D.  The funds used for the purchase of the Preferred Units reported herein were derived from the working capital of Stonepeak Catarina Holdings LLC.

 

The terms of the Preferred Units are set forth in the Second Amended and Restated Agreement of Limited Partnership of the Issuer dated October 14, 2015 (the “Amended Partnership Agreement”).  Under the terms of the Amended Partnership Agreement, the Reporting Persons have the right, at any time, to request conversion of their Preferred Units into Common Units at the Conversion Rate, subject to the requirement to convert a minimum of $17,500,000 of Preferred Units.  The “Conversion Rate” is equal to the quotient of (i) the aggregate purchase price for the Preferred Units plus accrued and unpaid distributions thereon, divided by (ii) the lesser of (a) the purchase price for the Preferred Units and (b) the volume weighted average price for which Common Units are issued by the Issuer during the period beginning on the Private Placement closing date (October 14, 2015) and ending on the date on which the Issuer has issued Common Units in exchange for cash in an aggregate amount equal to at least $75 million.  The initial Conversion Rate, in effect at the time of filing of this Schedule 13D, is 1:1 (i.e., each one Preferred Unit is convertible into one Common Unit).

Under the terms of the Amended Partnership Agreement, the Preferred Units will receive a quarterly distribution of, at the election of the Board, 10.0% per annum if paid in full in cash or 12.0% per annum if paid in part cash (8.0% per annum) and in part paid-in-kind units (4.0% per annum).  In the event the Issuer does not raise at least $75,000,000 through the issuance of additional Common Units prior to September 30, 2016 or if any Class A Preferred Units of the Issuer remain outstanding after March 31, 2016, the cash portion of the distribution rate will increase by 4.0% per annum until consummation of such issuance or conversion, as applicable.

Subject to the Board Representation and Standstill Agreement (as defined below), the Preferred Units will have the same voting rights as the holders of the Common Units and shall vote together as a single class with the Common Units.

The Issuer has the right to redeem the Preferred Units as follows: (i) from January 1, 2018 through December 31, 2018, the Issuer can redeem 33.33% of the Preferred Units at the greater of the current market price of the Common Units and 130% of the purchase price of the Preferred Units plus accrued distributions; (ii) from January 1, 2019 through December 31, 2019, the issuer can redeem 66.67% of the Preferred Units (less any Preferred Units previously redeemed) at the greater of the current market price of the Common Units and 120% of the purchase price of the Preferred Units plus accrued distributions; (iii) from January 1, 2020 through December 31, 2020, the issuer can redeem 100% of the Preferred Units at the greater of the current market price of the Common Units and 110% of the purchase price of the Preferred Units plus accrued distributions; and (iv) from January 1, 2021 through December 31, 2021, the issuer can redeem 100% of the Preferred Units at the greater of the current market price of the Common Units and the purchase price of the Preferred Units plus accrued distributions.  Subject to the foregoing limitations, if all Preferred Units are not redeemed by December 31, 2021, then the Issuer is

 

 

 

restricted from making cash distributions on any other units until the Preferred Units are redeemed in full as a result of a monthly sweep of adjusted available cash.

 

 

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SCHEDULE 13D

 

Page 14 of 19 Pages

 

The Reporting Persons acquired beneficial ownership of the securities reported herein for investment purposes and intend to review their investments in the Issuer on a continuing basis. Subject to the terms of the Transaction Documents, which have some restrictions on the potential actions described in this Item 4, depending on various factors, including but not limited to the Issuer’s financial position and strategic direction, price levels of the Common Units, conditions in the securities markets, and general economic and industry conditions, the Reporting Persons may in the future take actions with respect to their investment in the Issuer as they deem appropriate, including changing their current intentions, with respect to any or all matters required to be disclosed in this Schedule 13D. Without limiting the foregoing, and subject to the terms of the Transaction Documents, the Reporting Persons may, from time to time, acquire or cause affiliates to acquire Common Units or other securities of the Issuer, dispose, or cause affiliates to dispose, of some or all of the Preferred Units or other securities of the Issuer or continue to hold, or cause affiliates to hold, Preferred Units or other securities of the Issuer (or any combination or derivative thereof).

In addition, without limitation, subject to the terms of the Transaction Documents, as unitholders, the Reporting Persons may engage in discussions with management, the board of directors, unitholders of the Issuer and other relevant parties or take other actions concerning any extraordinary corporate transaction (including but not limited to a merger, reorganization or liquidation) or the business, operations, assets, strategy, future plans, prospects, corporate structure, board composition, management, capitalization, dividend policy, charter, bylaws, corporate documents, agreements, de-listing or de-registration of the Issuer.

(a)  As of the date hereof, each of the Reporting Persons may be deemed to beneficially own 19,444,445 Common Units issuable upon the conversion of the 19,444,445 Preferred Units at the initial Conversion Rate of 1:1.  This amount represents approximately 86.1% of the outstanding Common Units.

The foregoing beneficial ownership percentages are based on 22,593,996 Common Units outstanding, which is the sum of the 3,149,551  Common Units reported as outstanding as of August 13, 2015, in the Issuer’s amended quarterly report on Form 10-Q, filed September 3, 2015, plus, for purposes of calculating beneficial ownership pursuant to Rule 13d-3(d)(1)(i) under the Exchange Act, the 19,444,445 Common Units issuable upon the conversion of the Preferred Units beneficially owned by the Reporting Persons at the initial Conversion Rate of 1:1.

(b)  The Reporting Persons have shared voting power and shared dispositive power with regard to the 19,444,445 Common Units obtainable upon conversion of the 19,444,445 Preferred Units.

(c)  On October 14, 2015, Stonepeak Catarina Holdings LLC purchased 19,444,445 Preferred Units in a privately negotiated transaction with the Issuer for $18.00 per Preferred Unit.  There were no other transactions in Preferred Units or Common Units by the Reporting Persons in the past sixty days.

(d) Except as set forth in this Schedule 13D, no person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Common Units that may be deemed to be beneficially owned by the Reporting Persons.

(e) This Item 5(e) is not applicable.

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SCHEDULE 13D

 

Page 15 of 19 Pages

 

 

 

 

 

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SCHEDULE 13D

 

Page 16 of 19 Pages

 

 

October 26, 2015

Attention: Intentional misstatements or omissions of act constitute federal violations (see 18 U.S.C. 1001).

 

 

 

JOINT FILING AGREEMENT

The undersigned hereby agree that the statement on Schedule 13D with respect to the Common Units of Sanchez Production Partners LP, dated as of October 26, 2015, is, and any amendments thereto (including amendments on Schedule 13G) signed by each of the undersigned shall be, filed on behalf of each of us pursuant to and in accordance with the provisions of Rule 13d-1(k) under the Securities Exchange Act of 1934.