HF Sinclair offers to exchange Holly Energy notes for new notes, cash

By Wendy Van Sickle

Columbus, Ohio, Oct. 30 – HF Sinclair Corp. announced a private offer to exchange the notes issued by Holly Energy Partners, LP and Holly Energy Finance Corp. for notes issued by itself and cash.

The new HF Sinclair notes will have the same interest rate, payment dates, maturity dates and redemption terms at the existing notes, according to a news release. Concurrent consent solicitations relating to the notes are also being held.

The notes covered by the offer include

• The $400 million of outstanding 6 3/8% senior notes due April 15, 2027 (Cusips: 435765AJ1, U4377TAG5); and

• The $500 million of outstanding 5% senior notes due Feb. 1, 2028 (Cusips: 435765AH5, U4377TAF7).

For each series, the company is offering an early participation consideration – per $1,000 of existing notes – of $1,000 of new notes plus $1 in cash. The early participation consideration will be paid only to holders who tender their notes for exchange by the early deadline of 5 p.m. ET on Nov. 13.

The early consideration includes a premium of $50 principal amount of new notes that will not be paid to holders who tender after the early deadline.

The exchange offer will expire at 5 p.m. ET on Nov. 29.

Concurrently with the exchange offers, HF Sinclair is soliciting the consents from eligible holders to adopt some proposed amendments to the indentures governing the existing notes to, among other things, eliminate from each indenture substantially all of the restrictive covenants; certain of the events that may lead to an event of default; the U.S. Securities and Exchange Commission reporting covenant; and the requirement of Holly to offer to purchase the existing notes upon a change of control.

These proposed amendments will become effective with respect to a particular indenture if participation in the exchange offer of the relevant series of existing notes exceeds 50% of the outstanding principal amount of that series and all tendered existing notes of such series are accepted for exchange. Eligible holders of existing notes that tender such existing notes will be deemed to have given consent to the proposed amendments, and holders will not be permitted to tender their existing notes without delivering consents or to deliver consents without tendering their existing notes.

Tenders of existing notes may not be withdrawn after the earlier of the early participation date and the date on which the applicable supplemental indenture to the corresponding indenture implementing the amendments is executed, unless extended.

Notes must be tendered in a minimum amount of $2,000 and in integral multiples of $1,000 in excess thereof.

D.F. King & Co., Inc. (800 992-3086, 212 269-5550 or hfc@dfking.com) is the information and exchange agent for the exchange offers and consent solicitations.

The dealer managers for the exchange offers and consent solicitations are BofA Securities (888 292-0070 or debt_advisory@bofa.com) and Wells Fargo Securities (866 309-6316 or liabilitymanagement@wellsfargo.com).

Dallas-based HF Sinclair is an independent energy company that produces and markets high-value light products such as gasoline, diesel fuel, jet fuel, renewable diesel and other specialty products. It owns a 47% limited partner interest and a non-economic general partner interest in Holly Energy.

Holly Energy Partners provides petroleum product and crude oil transportation, terminalling, storage and throughput services to the petroleum industry, including HF Sinclair subsidiaries.

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