On March 24, 2022, HF Sinclair Corporation (the “Company”), commenced private offers to all Eligible Holders (as defined in the press release) to exchange (the “Exchange Offers”) any and all outstanding 2.625% Senior Notes due 2023, 5.875% Senior Notes due 2026 and 4.500% Senior Notes due 2030 (the “HFC Notes”) issued by HollyFrontier Corporation (“HFC”), for new notes to be issued by the Company and cash, pursuant to the terms and subject to the conditions set forth in a confidential exchange offer memorandum and consent solicitation statement, dated March 24, 2022 (the “Exchange Offer Memorandum”).
In conjunction with the Exchange Offers, the Company is soliciting the consents (collectively, the “Consent Solicitations”) of the Eligible Holders to adopt certain proposed amendments to the indenture governing the HFC Notes (as supplemented for each particular series of existing HFC Notes, the “HFC Indenture”) to, among other things, eliminate from the HFC Indenture, as it relates to each series of HFC Notes (i) substantially all of the restrictive covenants, (ii) certain of the events which may lead to an “Event of Default”, (iii) the SEC reporting covenant and (iv) with respect to HFC’s 2.625% Senior Notes due 2023 (the “HFC 2023 Notes”) and HFC’s 4.500% Senior Notes due 2030 (the “HFC 2030 Notes”) only, the offer to purchase HFC 2023 Notes and HFC 2030 Notes upon certain change of control triggering events (collectively, the “Proposed Amendments”). The Proposed Amendments will become effective with respect to a particular series of HFC Notes to the extent (i) participation in the Exchange Offer by such series of HFC Notes exceeds 50% of the outstanding principal amount of such series and (ii) all tendered HFC Notes of such series are accepted for exchange in the related Exchange Offer. Eligible Holders of HFC Notes that tender such HFC Notes will be deemed to have given consent to the Proposed Amendments (in respect of the applicable series of HFC Notes tendered). Eligible Holders will not be permitted to tender their HFC Notes without delivering consents or to deliver consents without tendering their HFC Notes. Tenders of HFC Notes may not be withdrawn after the earlier of (i) 5:00 p.m., New York City time, on the Early Participation Date (as defined below), and (ii) the date the applicable supplemental indenture to the corresponding HFC Indenture implementing the applicable Proposed Amendments is executed, unless extended (such date and time, as the same may be extended, the “Withdrawal Deadline”), except in the limited circumstances where additional withdrawal rights are required by law. A valid withdrawal of tendered HFC Notes will also constitute the revocation of the related consent with respect to the applicable HFC Indenture. As used herein, a “valid withdrawal” means valid withdrawal prior to the Withdrawal Deadline.
The Exchange Offers and the Consent Solicitations will expire at 5:00 p.m., New York City time, on April 22, 2022, unless extended or earlier terminated (such time and date, as the same may be extended, the “Expiration Date”). However, Eligible Holders who validly tender and do not validly withdraw their HFC Notes at or prior to 5:00 p.m., New York City time, on April 6, 2022 (as the same may be extended, the “Early Participation Date”), will be eligible to receive greater consideration for their HFC Notes than will be available for tenders made after the Early Participation Date but at or prior to the Expiration Date, all as more fully described in the attached press release and in the Exchange Offer Memorandum.
The Company will return to HFC all HFC Notes which are validly tendered and accepted pursuant to the Exchange Offers (the “Returned Notes”), and HFC will cancel such Returned Notes.
The Exchange Offers and Consent Solicitations are being made solely pursuant to the conditions set forth in the Exchange Offer Memorandum in a private offering exempt from, or not subject to, registration under the Securities Act of 1933, as amended, and are subject to certain conditions set forth in the Exchange Offer Memorandum, although the Company may waive any such conditions at any time.
The Company and HFC are in discussions with the current lending group under HFC’s Senior Unsecured 5-Year Revolving Credit Agreement, dated July 1, 2014 (as amended, restated, amended and restated, supplemented or otherwise modified as of the date hereof), among HFC, as borrower, and MUFG Bank, Ltd. (formerly known as The Bank of Tokyo Mitsubishi, Ltd.), as administrative agent, and each of the financial institutions party thereto as lenders (the “HFC Credit Agreement”), to either obtain a consent under or amendment to the HFC Credit Agreement or enter into a new credit facility, in each case to make the Company the borrower thereunder, to close contemporaneously with the settlement of the Exchange Offers and Consent Solicitations described in the Exchange Offer Memorandum. No assurances can be given, however, as to whether we will do so or as to the terms of any amended or new credit facility.
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