HOLLY ENERGY PARTNERS, L.P. Item 1.01 Entry into a Material Definitive Agreement.
Contribution Agreement
On
The cash consideration for the HEP Transactions is subject to customary
adjustments at closing for working capital of STC. The number of HEP common
limited partner units to be issued to Sinclair HoldCo at closing is subject to
downward adjustment if, as a condition to obtaining antitrust clearance for the
Sinclair Transactions (as defined below), the Partnership agrees to divest a
portion of its equity interest in
The Contribution Agreement contains customary representations, warranties and
covenants of HEP, Sinclair Holdco, and STC. The HEP Transactions are expected to
close in mid-2022, subject to the satisfaction or waiver of certain customary
conditions, including, among others (i) the expiration or early termination of
the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, and receipt of other required regulatory consents and
approvals and (ii) the consummation of the transactions contemplated by that
certain Business Combination Agreement, dated as of
The Contribution Agreement automatically terminates if the HFC Transactions are
terminated. The Contribution Agreement contains other customary termination
rights, including a termination right for each of the Partnership and Sinclair
HoldCo if, under certain circumstances, the closing does not occur by
The foregoing summary description of the Contribution Agreement and the HEP Transactions contemplated thereby is subject to and qualified in its entirety by reference to the Contribution Agreement, which is filed as Exhibit 2.1 hereto and incorporated by reference herein.
The Contribution Agreement has been attached as an exhibit to this Current Report on Form 8-K in order to provide investors and security holders with information regarding its terms. It is not intended to provide any other financial information about the parties thereto or their respective subsidiaries and affiliates. The representations, warranties and covenants contained in the Contribution Agreement were made only for purposes of that agreement and as of specific dates; were solely for the benefit of the parties thereto; may be subject to limitations agreed upon by such parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties thereto instead of establishing these matters as facts; and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors and security holders. Investors and security holders should not rely on the representations, warranties or covenants or any description thereof as characterizations of the actual state of facts or condition of the parties to the Contribution Agreement or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Contribution Agreement, which subsequent information may or may not be fully reflected in public disclosures by the parties thereto.
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Unitholders Agreement
On
Pursuant to the Unitholders Agreement, the Sinclair Parties will have the right to nominate one person to the HLS board of directors at the closing until such time that (x) the Sinclair Parties beneficially own less than 10.5 million HEP common limited partner units or (y) the HEP common limited partner units beneficially owned by the Sinclair Parties constitute less than 5% of all outstanding HEP common limited partner units. The Unitholders Agreement also subjects 15.75 million of the HEP common limited partner units issued to the Sinclair Parties (the "Restricted Units") to a "lock-up" period commencing on the closing date, during which the Sinclair Parties will be prohibited from selling the Restricted Units, except for certain permitted transfers. One-third of such Restricted Units will be released from such restrictions on the date that is six months after the closing, one-third of the Restricted Units will be released from such restrictions on the first anniversary of the closing date, and the remainder will be released from such restrictions on the date that is 15 months from the closing date. In addition, the Unitholders Agreement contains customary registration rights, requiring the Partnership to file, within five business days following the closing date, a shelf registration statement on Form S-3 under the Securities Act, to permit the public resale of all the registrable securities held by the Sinclair Parties and to use commercially reasonable efforts to cause such shelf registration statement to be declared effective as soon as reasonably practicable after the initial filing of the shelf registration statement, but in any event within forty-five days after the filing of a registration statement (if such Form S-3 is not immediately effective upon filing).
The foregoing description of the Unitholders Agreement does not purport to be a . . .
Item 3.02 Unregistered Sale of
The information set forth under the heading "Contribution Agreement" in Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference in this Item 3.02 hereof.
Item 7.01 Regulation FD Disclosure.
On
The information provided in this Item 7.01 (including Exhibit 99.1 and
Exhibit 99.2) shall not deemed to be "filed" for the purposes of Section 18 of
the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by
reference in any filing made by
Cautionary Statement Regarding Forward Looking Statements
This communication may contain or incorporate by reference statements or information that are, include or are based on forward-looking statements within the meaning of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give expectations, intentions, beliefs or forecasts of future events or otherwise for the future, and can be identified by the fact that they relate to future actions, performance or results rather than relating strictly to historical or current facts. Words such as "anticipate(s)," "project(s)," "expect(s)," "plan(s)," "goal(s)," "forecast(s)," "strategy", "intend(s)," "should," "would," "could," "believe," "may," and variations of such words and other words and expressions of similar meaning are intended to identify such forward-looking statements. However, the absence of such words or other words and expressions of similar meaning does not mean that a statement is not forward-looking.
These forward-looking statements include, but are not limited to, statements
regarding the acquisition by
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prices for refined products and market prices for crude oil, the possibility of
constraints on the transportation of refined products or lubricant and specialty
products, the possibility of inefficiencies, curtailments or shutdowns in
refinery operations or pipelines, whether due to infection in the work force or
in response to reductions in demand, effects of current and future governmental
and environmental regulations and policies, including the effects of current and
future restrictions on various commercial and economic activities in response to
the COVID-19 pandemic, and (viii) other factors, including those listed in the
most recent annual, quarterly and periodic reports of
HEP assumes no, and expressly disclaims any, duty or obligation to update or
correct any forward-looking statement as a result of events, changes, effects,
states of facts, conditions, circumstances, occurrences or developments
subsequent to the date of this communication or otherwise, except as required by
law. Readers are advised, however, to consult any further disclosures HEP makes
in its filings with the
Additional Information and Where to Find It
The issuance of shares of common stock in the new parent company of
Participants in Solicitation
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 2.1* Contribution Agreement, dated as ofAugust 2, 2021 , by and amongHolly Energy Partners, L.P. ,The Sinclair Companies , andSinclair Transportation Company . 10.1* Unitholders Agreement, dated as ofAugust 2, 2021 , by and amongHolly Energy Partners, L.P. ,Holly Logistic Services, L.L.C. ,Navajo Pipeline Co., L.P. ,The Sinclair Companies , and the unitholders set forth on Schedule I thereto, as may be amended from time to time. 10.2 Letter Agreement, dated as ofAugust 2, 2021 , by and amongHollyFrontier Corporation andHolly Energy Partners, L.P. 99.1 Press Release, dated as ofAugust 3, 2021 . 99.2 Investor Presentation, dated as ofAugust 3, 2021 . 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
* Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of
Regulation S-K. The registrant will furnish supplementally to the Securities
and
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