Partners' Capital

12 Months Ended

Jul. 31, 2017

As of July 31, 2017 and 2016, limited partner units were beneficially owned by the following:



	2017	2016
Public common unitholders (1)	69,612,939	70,462,939
Ferrell Companies (2)	22,529,361	22,529,361
FCI Trading Corp. (3)	195,686	195,686
Ferrell Propane, Inc. (4)	51,204	51,204
James E. Ferrell (5)	4,763,475	4,763,475


(1)	These common units are listed on the New York Stock Exchange under the symbol “FGP.”

(2)

Ferrell Companies is the owner of the general partner and an approximate 23.0% direct owner of Ferrellgas Partner’s common units and thus a related party. Ferrell Companies also beneficially owns 195,686 and 51,204 common units of Ferrellgas Partners held by FCI Trading Corp. (“FCI Trading”) and Ferrell Propane, Inc. (“Ferrell Propane”), respectively, bringing Ferrell Companies’ total beneficial ownership to 23.4%.


(3)	FCI Trading is an affiliate of the general partner and thus a related party.


(4)	Ferrell Propane is controlled by the general partner and thus a related party.

(5)

James E. Ferrell is the Interim Chief Executive Officer and President of our general partner; and is the Chairman of the Board of Directors of our general partner and a related party. JEF Capital Management owns 4,758,859 of these common units and is wholly-owned by the James E. Ferrell Revocable Trust Two for which James E. Ferrell is the trustee and sole beneficiary. The remaining 4,616 common units are held by Ferrell Resources Holdings, Inc., which is wholly-owned by the James E. Ferrell Revocable Trust One, for which James E. Ferrell is the trustee and sole beneficiary.

Together these limited partner units represent Ferrellgas Partner’s limited partners’ interest and an effective 98% economic interest in Ferrellgas Partners, exclusive of the general partners’ incentive distribution rights. The general partner has an effective 2% interest in Ferrellgas Partners, excluding incentive distribution rights. Since ongoing distributions have not yet reached the levels required to commence payment of incentive distribution rights to the general partner, distributions to the partners from operations or interim capital transactions will generally be made in accordance with the above percentages. In liquidation, allocations and distributions will be made in accordance with each common unitholder’s positive capital account.

The common units of Ferrellgas Partners represent limited partner interests in Ferrellgas Partners, which give the holders thereof the right to participate in distributions made by Ferrellgas Partners and to exercise the other rights or privileges available to such holders under the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P. dated February 18, 2003, as amended (the “Partnership Agreement”). Under the terms of the Partnership Agreement, holders of common units have limited voting rights on matters affecting the business of Ferrellgas Partners. Generally, persons owning 20% or more of Ferrellgas Partners’ outstanding common units cannot vote; however, this limitation does not apply to those common units owned by the general partner or its “affiliates,” as such term is defined in the Partnership Agreement.

The Partnership Agreement allows the general partner to issue an unlimited number of additional Ferrellgas general and limited partner interests of Ferrellgas Partners for such consideration and on such terms and conditions as shall be established by the general partner without the approval of any unitholders.

Partnership distributions paid by Ferrellgas Partners



	For the year ended July 31,
	2017		2016		2015
Public common unitholders	$	56,561	$	145,666	$	111,163
Ferrell Companies	18,305		46,184		45,059
FCI Trading Corp.	160		400		392
Ferrell Propane, Inc.	41		104		104
James E. Ferrell	3,869		9,764		8,717
General partner	797		2,042		1,670
	$	79,733	$	204,160	$	167,105

On August 22, 2017, Ferrellgas Partners declared a cash distribution of $0.10 per common unit for the three months ended July 31, 2017, which was paid on September 14, 2017. Included in this cash distribution were the following amounts paid to related parties:



Ferrell Companies	$	2,253
FCI Trading Corp.	20
Ferrell Propane, Inc.	5
James E. Ferrell	476
General partner	98

See additional discussions about transactions with related parties in Note N – Transactions with related parties.

Common unit issuances

During fiscal 2015, in a non-brokered registered direct offering, which units are subject to certain contractual transfer restrictions, Ferrellgas issued to Ferrell Companies, Inc. and the former owners of two salt water disposal wells from C&E Production, LLC ("C&E") and its affiliates an aggregate of 1.5 million common units for an aggregate purchase price of $42.0 million. Ferrellgas used these proceeds to pay down a portion of the borrowing under the secured credit facility used to fund the C&E salt water disposal wells acquisition as well as propane operations and related equipment sales acquisitions completed in fiscal 2014.

During fiscal 2015, Ferrellgas issued 6.3 million common units in a public offering valued at $139.1 million, after deducting for issuance costs. The net proceeds from this offering were used to partially fund the acquisition of Bridger.

During fiscal 2015, Ferrellgas issued 11.3 million common units valued at $260.0 million in connection with the acquisitions of Bridger and propane distribution assets.

Common unit repurchases

During September, 2016, Ferrellgas paid approximately $16.9 million to Jamex Marketing, LLC, and in return received approximately 0.9 million Ferrellgas Partners’ common units, which were cancelled upon receipt, and approximately 23 thousand barrels of crude oil.

During November, 2015, Ferrellgas repurchased approximately 2.4 million common units from Jamex Marketing, LLC, for approximately $45.9 million.

Accumulated Other Comprehensive Income (Loss) (“AOCI”)

See Note M – Derivative instruments and hedging activities – for details regarding changes in fair value on risk management financial derivatives recorded within AOCI for the years ended July 31, 2017 and 2016.

General partner’s commitment to maintain its capital account

Ferrellgas’ partnership agreements allows the general partner to have an option to maintain its effective 2% general partner interest concurrent with the issuance of other additional equity.

During fiscal 2017, the general partner made cash contributions of $1.7 million and non-cash contributions of $0.4 million to Ferrellgas to maintain its effective 2% general partner interest.

During fiscal 2016, the general partner made non-cash contributions of $0.7 million to Ferrellgas to maintain its effective 2% general partner interest.

Ferrellgas, L.P. [Member]

Partners' Capital

Partners' deficit

Partnership quarterly distributions paid

Ferrellgas, L.P. has paid the following quarterly distributions.



	For the year ended July 31,
	2017		2016		2015
Ferrellgas Partners	$	102,978	$	220,058	$	182,803
General partner	1,050		2,246		1,864

On August 22, 2017, Ferrellgas, L.P. declared distributions for the three months ended July 31, 2017 to Ferrellgas Partners and the general partner of $9.8 million and $0.1 million, respectively, which were paid on September 14, 2017.

Other Partnership distributions

During September 2016, in connection with Ferrellgas Partners' repurchase of common units, Ferrellgas, L.P distributed $15.9 million to Ferrellgas Partners.

During November 2015, in connection with Ferrellgas Partners' repurchase of common units, Ferrellgas, L.P distributed $46.4 million and $0.5 million to Ferrellgas Partners and the general partner, respectively.

Bridger transaction and related distributions and contributions

During June 2015, in connection with the Bridger Logistics Acquisition, Ferrellgas, L.P. entered into the following transactions with Ferrellgas Partners and the general partner:


•	Distributed $418.9 million and $4.3 million in cash to Ferrellgas Partners and the general partner, respectively.


•	Received an asset contribution of $822.5 million from Ferrellgas Partners.


•	In connection with this non-cash contribution, Ferrellgas, L.P. received a cash contribution of $8.4 million from the general partner.

See Note E – Business combinations for details regarding the acquisition of Bridger.

Other partnership contributions

During fiscal 2017, Ferrellgas, L.P. received cash contributions of $166.1 million and $1.7 million from Ferrellgas Partners and the general partner, respectively, which were used to reduce borrowings under the secured credit facility.

During fiscal 2015, Ferrellgas, L.P. received cash contributions of $42.2 million from Ferrellgas Partners. The proceeds were used to reduce outstanding indebtedness under Ferrellgas, L.P.'s secured credit facility.

During fiscal 2015, Ferrellgas, L.P. received asset contributions of $3.0 million from Ferrellgas Partners in connection with acquisitions of propane distribution assets.

See additional discussions about transactions with related parties in Note N – Transactions with related parties.

Accumulated other comprehensive income (loss) (“AOCI”)

General partner’s commitment to maintain its capital account

Ferrellgas, L.P.’s partnership agreement allows the general partner to have an option to maintain its 1.0101% general partner interest concurrent with the issuance of other additional equity.

During fiscal 2017, the general partner made cash contributions of $1.7 million and non-cash contributions of $0.2 million to Ferrellgas, L.P. to maintain its 1.0101% general partner interest.

During fiscal 2016, the general partner made non-cash contributions of $0.4 million to Ferrellgas, L.P. to maintain its 1.0101% general partner interest.