(Mark One)
|
||
þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 |
|
For the fiscal year ended December 31, 2009 | ||
OR | ||
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 |
|
For the transition period from to |
Delaware | 61-1512186 | |
(State or Other Jurisdiction
of
Incorporation or Organization) |
(I.R.S. Employer
Identification No.) |
|
2277 Plaza Drive, Suite 500
Sugar Land, Texas (Address of Principal Executive Offices) |
77479
(Zip Code) |
Title of Each Class
|
Name of Each Exchange on Which Registered
|
|
Common Stock, $0.01 par value per share | The New York Stock Exchange |
Large accelerated filer o | Accelerated filer þ | Non-accelerated filer o | Smaller reporting company o |
Class
|
Outstanding at March 10, 2010
|
|
Common Stock, par value $0.01 per share | 86,329,237 shares |
Document
|
Parts Incorporated
|
|
Proxy Statement for the 2010 Annual Meeting of Stockholders to be held May 19, 2010 | Items 9, 10, 11, 12 and 13 of Part III |
i
1
2
Item 1.
Business
a crude oil gathering system serving Kansas, Oklahoma, western
Missouri, eastern Colorado and southwestern Nebraska;
a 145,000 bpd pipeline system that transports crude oil to
our refinery with 1.2 million barrels of associated
company-owned storage tanks and an additional 2.7 million
barrels of leased storage capacity located at Cushing, Oklahoma;
a rack marketing division supplying product through tanker
trucks directly to customers located in close geographic
proximity to Coffeyville and Phillipsburg and to customers at
throughput terminals on Magellan refined products distribution
systems and NuStar Energy, LP (NuStar); and
storage and terminal facilities for asphalt and refined fuels in
Phillipsburg, Kansas.
3
Table of Contents
CALLC transferred all of its businesses to CVR Energy in
exchange for all of CVR Energys common stock;
CALLC was effectively split into two entities, with the Kelso
Funds controlling CALLC and the Goldman Sachs Funds controlling
Coffeyville Acquisition II LLC (CALLC II) and
CVR Energys senior management receiving an equivalent
position in each of the two entities;
we transferred our nitrogen fertilizer business to the
Partnership in exchange for all of the partnership interests in
the Partnership; and
we sold all of the interests of the managing general partner of
the Partnership to an entity owned by our controlling
stockholders and senior management at fair market value on the
date of the transfer.
4
Table of Contents
*
CVR GP, LLC, which we refer to as Fertilizer GP, is the managing
general partner of CVR Partners, LP. As managing general
partner, Fertilizer GP holds incentive distribution rights, or
IDRs, which entitle it to receive increasing percentages of the
Partnerships quarterly distributions if the Partnership
increases its distributions above an amount specified in the
limited partnership agreement.
5
Table of Contents
Crude Oil Gathering System.
We own and operate
a crude oil gathering system serving Kansas, Oklahoma, western
Missouri, eastern Colorado and southwestern Nebraska. The system
has field offices in Bartlesville, Oklahoma and Plainville and
Winfield, Kansas. The system is comprised of approximately
300 miles of feeder and trunk pipelines, 71 trucks, and
associated storage facilities for gathering sweet Kansas,
Nebraska, Oklahoma, Missouri, and Colorado crude oils purchased
from independent crude producers. We also lease a section of a
pipeline from Magellan, which is incorporated into our crude oil
gathering system. Our crude oil gathering system has a gathering
capacity in excess of 30,000 bpd. Gathered crude oil
provides a base supply of feedstock for our refinery and serves
as an attractive and competitive supply of crude oil.
Phillipsburg Terminal.
We own storage and
terminalling facilities for refined fuels and asphalt in
Phillipsburg, Kansas. The asphalt storage and terminalling
facilities are used to receive, store and redeliver asphalt for
another oil company for a fee pursuant to an asphalt services
agreement.
Pipelines.
We own a proprietary pipeline
system capable of transporting approximately 145,000 bpd of
crude oil from Caney, Kansas to our refinery. Crude oils sourced
outside of our proprietary gathering system are delivered by
common carrier pipelines into various terminals in Cushing,
Oklahoma, where they are blended and then delivered to Caney,
Kansas via a pipeline owned by Plains Pipeline L.P.
(Plains). We also own associated crude oil storage
tanks with a capacity of approximately 1.2 million barrels
located outside our refinery.
6
Table of Contents
7
Table of Contents
8
Table of Contents
9
Table of Contents
restrictions on operations
and/or
the
need to install enhanced or additional controls;
the need to obtain and comply with permits and authorizations;
liability for the investigation and remediation of contaminated
soil and groundwater at current and former facilities and
off-site waste disposal locations; and
specifications for the products marketed by our petroleum
business and the nitrogen fertilizer business, primarily
gasoline, diesel fuel, UAN and ammonia.
10
Table of Contents
11
Table of Contents
12
Table of Contents
13
Table of Contents
Total
Site
Total O&M
Estimated
Investigation
Capital
Costs
Costs
Costs
Costs
Through 2013
Through 2013
$
0.2
$
$
0.9
$
1.1
0.6
1.2
1.8
$
0.8
$
$
2.1
$
2.9
14
Table of Contents
15
Table of Contents
Item 1A.
Risk
Factors
16
Table of Contents
17
Table of Contents
18
Table of Contents
19
Table of Contents
20
Table of Contents
weather patterns and field conditions (particularly during
periods of traditionally high nitrogen fertilizer consumption);
quantities of nitrogen fertilizers imported to and exported from
North America;
current and projected grain inventories and prices, which are
heavily influenced by U.S. exports and world-wide grain
markets; and
U.S. governmental policies, including farm and biofuel
policies, which may directly or indirectly influence the number
of acres planted, the level of grain inventories, the mix of
crops planted or crop prices.
21
Table of Contents
22
Table of Contents
23
Table of Contents
Although we believe we have sufficient liquidity under our
revolving credit facility to run our business, under extreme
market conditions there can be no assurance that such funds
would be available or sufficient, and in such a case, we may not
be able to successfully obtain additional financing on favorable
terms, or at all.
Market volatility has exerted downward pressure on our stock
price, which may make it more difficult for us to raise
additional capital and thereby limit our ability to grow.
Our credit facility contains various financial covenants that we
must comply with every quarter. Although we successfully amended
these covenants in December 2008 and again in October 2009, due
to the current economic environment there can be no assurance
that we would be able to successfully amend the agreement in the
future if we were to fall out of covenant compliance. Further,
any such amendment could be very expensive.
Market conditions could result in our significant customers
experiencing financial difficulties. We are exposed to the
credit risk of our customers, and their failure to meet their
financial obligations when due because of bankruptcy, lack of
liquidity, operational failure or other reasons could result in
decreased sales and earnings for us.
24
Table of Contents
25
Table of Contents
26
Table of Contents
27
Table of Contents
unforeseen difficulties in the acquired operations and
disruption of the ongoing operations of our petroleum business
and the nitrogen fertilizer business;
failure to achieve cost savings or other financial or operating
objectives with respect to an acquisition;
strain on the operational and managerial controls and procedures
of our petroleum business and the nitrogen fertilizer business,
and the need to modify systems or to add management resources;
difficulties in the integration and retention of customers or
personnel and the integration and effective deployment of
operations or technologies;
assumption of unknown material liabilities or regulatory
non-compliance issues;
28
Table of Contents
amortization of acquired assets, which would reduce future
reported earnings;
possible adverse short-term effects on our cash flows or
operating results; and
diversion of managements attention from the ongoing
operations of our business.
limiting our ability to obtain additional financing to fund our
working capital needs, capital expenditures, debt service
requirements or for other purposes;
limiting our ability to use operating cash flow in other areas
of our business because we must dedicate a substantial portion
of these funds to service debt;
limiting our ability to compete with other companies who are not
as highly leveraged, as we may be less capable of responding to
adverse economic and industry conditions;
29
Table of Contents
placing restrictive financial and operating covenants in the
agreements governing our and our subsidiaries long-term
indebtedness and bank loans, including, in the case of certain
indebtedness of subsidiaries, certain covenants that restrict
the ability of subsidiaries to pay dividends or make other
distributions to us;
exposing us to potential events of default (if not cured or
waived) under financial and operating covenants contained in our
or our subsidiaries debt instruments that could have a
material adverse effect on our business, financial condition and
operating results;
increasing our vulnerability to a downturn in general economic
conditions or in pricing of our products; and
limiting our ability to react to changing market conditions in
our industry and in our customers industries.
30
Table of Contents
the requirement that a majority of our board of directors
consist of independent directors;
the requirement that we have a nominating/corporate governance
committee that is composed entirely of independent
directors; and
the requirement that we have a compensation committee that is
composed entirely of independent directors.
31
Table of Contents
32
Table of Contents
We Hold Our Interest in the Nitrogen Fertilizer
Business
Because we neither serve as, nor control, the managing general
partner of the Partnership, the managing general partner may
operate the Partnership in a manner with which we disagree or
which is not in our interest. CVR GP, LLC or Fertilizer GP,
which is owned by our controlling stockholders and senior
33
Table of Contents
management, is the managing general partner of the Partnership
which holds the nitrogen fertilizer business. The managing
general partner is authorized to manage the operations of the
nitrogen fertilizer business (subject to our specified joint
management rights), and we do not control the managing general
partner. Although our senior management also serves as the
senior management of Fertilizer GP, in accordance with a
services agreement among us, Fertilizer GP and the Partnership,
our senior management operates the Partnership under the
direction of the managing general partners board of
directors and Fertilizer GP has the right to select different
management at any time (subject to our joint right in relation
to the chief executive officer and chief financial officer of
the managing general partner). Accordingly, the managing general
partner may operate the Partnership in a manner with which we
disagree or which is not in the interests of our company and our
stockholders.
We may be required in the future to share increasing portions of
the cash flows of the nitrogen fertilizer business with third
parties and we may in the future be required to deconsolidate
the nitrogen fertilizer business from our consolidated financial
statements.
The Partnership has a preferential right to pursue most
corporate opportunities (outside of the refining business)
before we can pursue them. Also, we have agreed with the
Partnership that we will not own or operate a fertilizer
business other than the Partnership (with certain exceptions).
If the Partnership elects to pursue and completes a public
offering or private placement of limited partner interests, our
voting power in the Partnership would be reduced and our rights
to distributions from the Partnership could be materially
adversely affected.
If the managing general partner of the Partnership elects to
pursue a public or private offering of Partnership interests, we
will be required to use our commercially reasonable efforts to
amend our credit facility to remove the Partnership as a
guarantor. Any such amendment could results in increased fees to
us or other onerous terms in our credit facility. In addition,
we may not be able to obtain such an amendment on terms
acceptable to us or at all.
Fertilizer GP can require us to be a selling unit holder in the
Partnerships initial offering at an undesirable time or
price.
Our rights to remove Fertilizer GP as managing general partner
of the Partnership are extremely limited.
Fertilizer GPs interest in the Partnership and the control
of Fertilizer GP may be transferred to a third party without our
consent. The new owners of Fertilizer GP may have no interest in
CVR Energy and may take actions that are not in our interest.
34
Table of Contents
Fertilizer GP, as managing general partner of the Partnership,
holds all of the IDRs in the Partnership. IDRs give Fertilizer
GP a right to increasing percentages of the Partnerships
quarterly distributions after the IDR Effective Date, and if the
quarterly distributions exceed the target of $0.4313 per unit.
Fertilizer GP may have an incentive to manage the Partnership in
a manner which preserves or increases the possibility of these
future cash flows rather than in a manner that preserves or
increases current cash flows.
The owners of Fertilizer GP, who are also our controlling
stockholders and senior management, are permitted to compete
with us or the Partnership or to own businesses that compete
with us or the Partnership. In addition, the owners of
Fertilizer GP are not required to share business opportunities
with us, and our owners are not required to share business
opportunities with the Partnership or Fertilizer GP.
Neither the partnership agreement nor any other agreement
requires the owners of Fertilizer GP to pursue a business
strategy that favors us or the Partnership. The owners of
Fertilizer GP have fiduciary duties to make decisions in their
own best interests, which may be contrary to our interests and
the interests of the Partnership. In addition, Fertilizer GP is
allowed to take into account the interests of parties other than
us, such as its owners, or the Partnership in resolving
conflicts of interest, which has the effect of limiting its
fiduciary duty to us.
Fertilizer GP has limited its liability and reduced its
fiduciary duties under the partnership agreement and has also
restricted the remedies available to the unitholders of the
Partnership, including us, for actions that, without the
limitations, might constitute breaches of fiduciary duty. As a
result of our ownership interest in the Partnership, we may
consent to some actions and conflicts of interest that might
otherwise constitute a breach of fiduciary or other duties under
applicable state law.
Fertilizer GP determines the amount and timing of asset
purchases and sales, capital expenditures, borrowings, repayment
of indebtedness, issuances of additional partnership interests
and cash reserves maintained by the Partnership (subject to our
specified joint management rights), each of which can affect the
amount of cash that is available for distribution to us.
Fertilizer GP is also able to determine the amount and timing of
any capital expenditures and whether a capital expenditure is
for maintenance, which reduces operating surplus, or expansion,
which does not. Such determinations can affect the amount of
cash that is available for distribution and the manner in which
the cash is distributed.
35
Table of Contents
The partnership agreement does not restrict Fertilizer GP from
causing the nitrogen fertilizer business to pay it or its
affiliates for any services rendered to the Partnership or
entering into additional contractual arrangements with any of
these entities on behalf of the Partnership.
Fertilizer GP determines which costs incurred by it and its
affiliates are reimbursable by the Partnership.
The executive officers of Fertilizer GP, and the majority of the
directors of Fertilizer GP, also serve as our directors
and/or
executive officers. The executive officers who work for both us
and Fertilizer GP, including our chief executive officer, chief
operating officer, chief financial officer and general counsel,
divide their time between our business and the business of the
Partnership. These executive officers will face conflicts of
interest from time to time in making decisions which may benefit
either us or the Partnership.
36
Table of Contents
Item 1B.
Unresolved
Staff Comments
Item 2.
Properties
Acres
Own/Lease
440
Own
Coffeyville Resources: oil refinery and office buildings
Partnership: fertilizer plant
200
Own
Terminal facility
20
Own
Crude oil storage
20
Own
Crude oil storage
25
Own
Truck storage and office buildings
5
Own
Truck storage
80
Own
Crude oil storage
7
Own
Crude oil storage
6
Own
Crude oil storage
Item 3.
Legal
Proceedings
37
Table of Contents
63
68
134
141
142
143
144
Item 4.
Market
For Registrants Common Equity, Related Stockholder Matters
and Issuer Purchases of Equity Securities
High
Low
$
6.71
$
3.13
10.74
5.24
12.67
6.21
13.89
6.50
High
Low
$
30.94
$
20.71
28.88
18.17
19.75
8.47
9.01
2.15
38
Table of Contents
BETWEEN OCTOBER 23, 2007 AND DECEMBER 31, 2009
among CVR Energy, Inc., Russell 2000 Index and a peer
group
Oct 07
Dec 07
Mar 08
Jun 08
Sep 08
Dec 08
Mar 09
Jun 09
Sep 09
Dec 09
100.00
123.16
113.73
95.06
42.07
19.75
27.36
36.20
61.43
33.88
100.00
93.59
84.05
84.26
83.02
61.02
51.65
62.10
73.83
76.40
100.00
84.02
58.83
50.99
40.49
27.68
33.43
27.26
31.52
28.34
39
Table of Contents
Equity Compensation Plan Information
Number of
Number of
Securities
Securities to be
Remaining Available
Issued Upon
Weighted-Average
for Future Issuance
Exercise of
Exercise Price of
Under Equity
Outstanding Options
Outstanding Options
Compensation Plans
32,350
$
19.08
7,102,644
32,350
$
19.08
7,102,644
Item 5.
Selected
Financial Data
40
Table of Contents
Successor
Predecessor
Year
233 Days
174 Days
Ended
Ended
Ended
December 31,
December 31,
June 23,
2009
2008
2007
2006
2005
2005
(dollars in millions, except share data)
$
3,136.3
$
5,016.1
$
2,966.9
$
3,037.6
$
1,454.3
$
980.7
2,547.7
4,461.8
2,308.8
2,443.4
1,168.1
768.0
226.0
237.5
276.1
199.0
85.3
80.9
68.9
35.2
93.1
62.6
18.4
18.4
0.6
7.9
41.5
84.9
82.2
60.8
51.0
24.0
1.1
42.8
$
208.2
$
148.7
$
186.6
$
281.6
$
158.5
$
112.3
(0.1
)
(5.9
)
0.2
(20.8
)
0.4
(8.4
)
(44.2
)
(40.3
)
(61.1
)
(43.9
)
(25.0
)
(7.8
)
(65.3
)
125.3
(282.0
)
94.5
(316.1
)
(7.6
)
$
98.6
$
227.8
$
(156.3
)
$
311.4
$
(182.2
)
$
88.5
(29.2
)
(63.9
)
88.5
(119.8
)
63.0
(36.1
)
0.2
$
69.4
$
163.9
$
(67.6
)
$
191.6
$
(119.2
)
$
52.4
$
0.80
$
1.90
$
(0.78
)
$
2.22
$
0.80
$
1.90
$
(0.78
)
$
2.22
86,248,205
86,145,543
86,141,291
86,141,291
86,342,433
86,224,209
86,141,291
86,158,791
$
0.70
$
0.70
$
3.1
$
246.9
$
36.9
$
8.9
$
30.5
$
41.9
$
64.7
235.4
128.5
10.7
112.3
108.0
1,614.5
1,610.5
1,868.4
1,449.5
1,221.5
491.3
495.9
500.8
775.0
499.4
10.6
10.6
10.6
4.3
653.8
579.5
432.7
76.4
115.8
85.3
83.2
145.9
186.6
82.5
12.7
(48.3
)
(86.5
)
(268.6
)
(240.2
)
(730.3
)
(12.3
)
(9.0
)
(18.3
)
111.3
30.8
712.5
(52.4
)
48.8
86.5
268.6
240.2
45.2
12.3
94.1
11.2
(5.6
)
115.4
23.6
52.4
(1)
Amounts are shown exclusive of depreciation and amortization.
41
Table of Contents
(2)
Represents the write-off of approximate net costs associated
with the June/July 2007 flood and crude oil spill that are not
probable of recovery.
(3)
Upon applying the goodwill impairment testing criteria under
existing accounting rules during the fourth quarter of 2008, we
determined that the goodwill in the petroleum segment was
impaired, which resulted in a goodwill impairment loss of
$42.8 million. This represented a write-off of the entire
balance of the petroleum segments goodwill.
(4)
During the years ended December 31, 2009, 2008, 2007 and
2006 and the
174-days
ended June 23, 2005, we recognized a loss of
$2.1 million, $10.0 million, $1.3 million,
$23.4 million and $8.1 million, respectively, on early
extinguishment of debt.
(5)
The following are certain charges and costs incurred in each of
the relevant periods that are meaningful to understanding our
net income and in evaluating our performance due to their
unusual or infrequent nature (in millions):
Successor
Predecessor
Year
233 Days
174 Days
Ended
Ended
Ended
December 31,
December 31
June 23,
2009
2008
2007
2006
2005
2005
$
2.1
$
10.0
$
1.3
$
23.4
$
$
8.1
16.6
13.4
7.4
1.8
2.3
3.3
76.4
6.6
25.0
40.9
(253.2
)
103.2
(126.8
)
235.9
8.8
(42.5
)
44.1
16.9
1.1
4.0
42.8
(a)
Represents the write-off of: (1) $2.1 million of
deferred financing costs in connection with the reduction,
effective June 1, 2009, and eventual termination of the
funded letter of credit facility on October 15, 2009;
(2) $10.0 million of deferred financing costs in
connection with the second amendment to our credit facility on
December 22, 2008; (3) $1.3 million of deferred
financing costs in connection with the repayment and termination
of three credit facilities on October 26, 2007;
(4) $23.4 million in connection with the refinancing
of our senior secured credit facility on December 28, 2006;
and (5) $8.1 million of deferred financing costs in
connection with the refinancing of our senior secured credit
facility on June 23, 2005.
(b)
Consists of the additional cost of product sold expense due to
the step up to estimated fair value of certain inventories on
hand at the time of the Acquisition, June 24, 2005.
(c)
Consists of fees which are expensed to selling, general and
administrative expenses in connection with the funded letter of
credit facility of $150.0 million issued in support of the
Cash Flow Swap and other letters of credit outstanding. CRLLC
reduced the funded letter of credit facility from
$150.0 million to $60.0 million, effective
June 1, 2009. As a result of the termination of the Cash
Flow Swap effective October 8, 2009, the CRLLC was able to
terminate the remaining $60.0 million funded letter of
credit facility effective October 15, 2009. Although not
included as interest expense in our Consolidated Statements of
Operations, these fees are treated as such in the calculation of
consolidated adjusted EBITDA in the credit facility.
(d)
Represents expense associated with a major scheduled turnaround.
(e)
Represents the expense associated with the expiration of the
crude oil, heating oil and gasoline option agreements entered
into by CALLC in May 2005.
42
Table of Contents
(f)
Represents the impact of share-based compensation awards.
(g)
Upon applying the goodwill impairment testing criteria under
existing accounting rules during the fourth quarter of 2008, we
determined that the goodwill in the petroleum segment was
impaired, which resulted in a goodwill impairment loss of
$42.8 million. This represented a write-off of the entire
balance of the petroleum segments goodwill.
(6)
Earnings per share and weighted-average shares outstanding are
shown on a pro forma basis for 2007 and 2006.
(7)
Historical dividends per unit for the
174-day
period ended June 23, 2005 is calculated on the ownership
structure of the Predecessor.
(8)
Noncontrolling interest at December 31, 2006 reflects
common stock in two of our subsidiaries owned by our Chief
Executive Officer (which were exchanged for shares of our common
stock with an equivalent value prior to the consummation of our
initial public offering). The noncontrolling interest at
December 31, 2009, 2008 and 2007 reflects CAIIIs
ownership of the managing general partner interest and the IDRs
of the Partnership. In our 2008 and 2007 Annual Report on
Form 10-K,
our noncontrolling interest was previously referred to as
minority interest. As a result of the adoption of
Financial Accounting Standards Board (FASB)
Accounting Standards Codification (ASC) ASC
810
Consolidation
, the term minority
interest has been updated accordingly for all periods
presented.
(9)
Net income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap results from adjusting for the derivative transaction
that was executed in conjunction with the Acquisition. On
June 16, 2005, CALLC entered into the Cash Flow Swap with
J. Aron & Company (J. Aron), a subsidiary
of The Goldman Sachs Group, Inc., and a related party of ours.
The Cash Flow Swap was subsequently assigned by CALLC to CRLLC
on June 24, 2005. The Cash Flow Swap took the
form of three NYMEX swap agreements whereby if absolute (i.e.,
in dollar terms, not a percentage of crude oil prices) crack
spreads fell below the fixed level, J. Aron agreed to pay the
difference to us, and if absolute crack spreads rose above the
fixed level, we agreed to pay the difference to J. Aron. On
October 8, 2009, the Cash Flow Swap was terminated and all
remaining obligations were settled in advance of the original
expiration date of June 30, 2010.
We determined that the Cash Flow Swap did not qualify as a hedge
for hedge accounting treatment under current U.S. generally
accepted accounting principles (GAAP). As a result,
our periodic Statements of Operations reflect in each period
material amounts of unrealized gains and losses based on the
increases or decreases in market value of the unsettled position
under the swap agreements which are accounted for as an asset or
liability on our balance sheet, as applicable. As the absolute
crack spreads increased, we were required to record an increase
in this liability account with a corresponding expense entry to
be made to our Statements of Operations. Conversely, as absolute
crack spreads declined, we were required to record a decrease in
the swap related liability and post a corresponding income entry
to our Statements of Operations. Because of this inverse
relationship between the economic outlook for our underlying
business (as represented by crack spread levels) and the income
impact of the unrecognized gains and losses, and given the
significant periodic fluctuations in the amounts of unrealized
gains and losses, management utilizes Net income (loss) adjusted
for unrealized gain or loss from Cash Flow Swap as a key
indicator of our business performance. In managing our business
and assessing its growth and profitability from a strategic and
financial planning perspective, management and our board of
directors considers our GAAP net income results as well as Net
income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap. We believe that Net income (loss) adjusted for
unrealized gain or loss from Cash Flow Swap enhances the
understanding of our results of operations by highlighting
income attributable to our ongoing operating performance
exclusive of charges and income resulting from mark to market
adjustments that are not necessarily indicative of the
performance of our underlying business and our industry. The
adjustment has been made for the unrealized gain or loss from
Cash Flow Swap net of its related tax effect.
Net income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap is not a recognized term under GAAP and should not be
substituted for net income as a measure of our performance but
instead should be utilized as a supplemental measure of
financial performance in evaluating our business. Our
presentation of this non-GAAP measure may not be comparable to
similarly titled measures of other
43
Table of Contents
companies. We believe that net income (loss) adjusted for
unrealized gain or loss from Cash Flow Swap is important to
enable investors to better understand and evaluate our ongoing
operating results and allow for greater transparency in the
review of our overall business, financial, operational and
economic performance.
The following is a reconciliation of Net income (loss) adjusted
for unrealized gain or loss from Cash Flow Swap to Net income
(loss) (in millions):
Successor
Predecessor
Year
233 Days
174 Days
Ended
Ended
Ended
December 31,
December 31,
June 23,
2009
2008
2007
2006
2005
2005
$
94.1
$
11.2
$
(5.6
)
$
115.4
$
23.6
$
52.4
(24.7
)
152.7
(62.0
)
76.2
(142.8
)
$
69.4
$
163.9
$
(67.6
)
$
191.6
$
(119.2
)
$
52.4
Item 6.
Managements
Discussion and Analysis of Financial Condition and Results of
Operations
statements, other than statements of historical fact, that
address activities, events or developments that we expect,
believe or anticipate will or may occur in the future;
statements relating to future financial performance, future
capital sources and other matters; and
any other statements preceded by, followed by or that include
the words anticipates, believes,
expects, plans, intends,
estimates, projects, could,
should, may, or similar expressions.
44
Table of Contents
45
Table of Contents
46
Table of Contents
47
Table of Contents
48
Table of Contents
49
Table of Contents
50
Table of Contents
51
Table of Contents
52
Table of Contents
a sale of some or all of our partnership interests to an
unrelated party;
a sale of the managing general partner interest to a third party;
the issuance by the Partnership of partnership interests to
parties other than us or our related parties; and
the acquisition by us of additional partnership interests
(either new interests issued by the Partnership or interests
acquired from unrelated interest holders).
53
Table of Contents
54
Table of Contents
Year Ended December 31,
2009
2008
2007
(in millions)
$
3,136.3
$
5,016.1
$
2,966.9
2,547.7
4,461.8
2,308.8
226.0
237.5
276.1
68.9
35.2
93.1
0.6
7.9
41.5
84.9
82.2
60.8
42.8
$
208.2
$
148.7
$
186.6
69.4
163.9
(67.6
)
94.1
11.2
(5.6
)
(1)
Represents the costs associated with the June/July 2007 flood
and crude oil spill net of probable recoveries from insurance.
(2)
Depreciation and amortization is comprised of the following
components as excluded from cost of product sold, direct
operating expense and selling, general and administrative
expense:
Year Ended December 31,
2009
2008
2007
(in millions)
$
2.9
$
2.5
$
2.4
80.0
78.0
57.4
2.0
1.7
1.0
7.6
$
84.9
$
82.2
$
68.4
(3)
Upon applying the goodwill impairment testing criteria under
existing accounting rules during the fourth quarter of 2008, we
determined that the goodwill in the petroleum segment was
impaired, which resulted
55
Table of Contents
in a goodwill impairment loss of $42.8 million. This
represented a write-off of the entire balance of the petroleum
segment goodwill.
(4)
The following are certain charges and costs incurred in each of
the relevant periods that are meaningful to understanding our
net income and in evaluating our performance due to their
unusual or infrequent nature:
Year Ended December 31,
2009
2008
2007
(in millions)
$
2.1
$
10.0
$
1.3
13.4
7.4
1.8
3.3
76.4
40.9
(253.2
)
103.2
8.8
(42.5
)
44.1
42.8
(a)
For 2009, the $2.1 million loss on extinguishment of debt
represents the write-off of deferred financing costs associated
with the reduction of the funded letter of credit facility of
$150.0 million to $60.0 million, effective
June 1, 2009, issued in support of the Cash Flow Swap and
as a result of the termination of the Cash Flow Swap on
October 8, 2009, the Company was able to terminate the
remaining $60.0 million funded letter of credit facility
effective October 15, 2009. For 2008, represents the
write-off of $10.0 million in connection with the second
amendment to our existing credit facility, which amendment was
completed on December 22, 2008. For 2007, the write-off of
$1.3 million in connection with the repayment and
termination of three credit facilities on October 26, 2007.
(b)
Consists of fees which are expensed to selling, general and
administrative expense in connection with the funded letter of
credit facility issued in support of the Cash Flow Swap and
other letters of credit outstanding. Although not included as
interest expense in our Consolidated Statements of Operations,
these fees are treated as such in the calculation of
consolidated adjusted EBITDA in the credit facility. As noted
above, the Cash Flow Swap was terminated effective
October 8, 2009 and the related funded letter of credit
facility was terminated effective October 15, 2009.
(c)
Represents expenses associated with a major scheduled turnaround
at the nitrogen fertilizer plant and our refinery.
(d)
Represents the impact of share-based compensation awards.
(e)
Upon applying the goodwill impairment testing criteria under
existing accounting rules during the fourth quarter of 2008, we
determined that the goodwill in the petroleum segment was
impaired, which resulted in a goodwill impairment loss of
$42.8 million. This represented a write-off of the entire
balance of the petroleum segments goodwill.
(5)
Net income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap results from adjusting for the derivative transaction
that was executed in conjunction with the Acquisition. On
June 16, 2005, Coffeyville Acquisition entered into the
Cash Flow Swap with J. Aron , a subsidiary of The Goldman Sachs
Group, Inc., and a related party of ours. The Cash Flow Swap was
subsequently assigned by Coffeyville Acquisition to Coffeyville
Resources on June 24, 2005. The Cash Flow Swap took the
form of three NYMEX swap agreements whereby if absolute (i.e.,
in dollar terms, not a percentage of crude oil prices) crack
spreads fell below the fixed level, J. Aron agreed to pay the
difference to us, and if absolute crack spreads rose above the
fixed level, we agreed to pay the difference to J. Aron. On
October 8, 2009, the Cash Flow Swap was terminated and all
remaining obligations were settled in advance of the original
expiration date of June 30, 2010.
We determined that the Cash Flow Swap did not qualify as a hedge
for hedge accounting treatment under current U.S. GAAP. As
a result, our periodic Statements of Operations reflect in each
period material amounts of unrealized gains and losses based on
the increases or decreases in market value of the unsettled
position under the swap agreements which are accounted for as an
asset or liability on our balance sheet,
56
Table of Contents
as applicable. As absolute crack spreads increased, we were
required to record an increase in this liability account with a
corresponding expense entry to be made to our Statements of
Operations. Conversely, as absolute crack spreads declined, we
were required to record a decrease in the swap related liability
and post a corresponding income entry to our Statements of
Operations. Because of this inverse relationship between the
economic outlook for our underlying business (as represented by
crack spread levels) and the income impact of the unrecognized
gains and losses, and given the significant periodic
fluctuations in the amounts of unrealized gains and losses,
management utilizes Net income (loss) adjusted for unrealized
gain or loss from Cash Flow Swap as a key indicator of our
business performance. In managing our business and assessing its
growth and profitability from a strategic and financial planning
perspective, management and our board of directors considers our
GAAP net income results as well as Net income (loss) adjusted
for unrealized gain or loss from Cash Flow Swap. We believe that
Net income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap enhances an understanding of our results of operations
by highlighting income attributable to our ongoing operating
performance exclusive of charges and income resulting from mark
to market adjustments that are not necessarily indicative of the
performance of our underlying business and our industry. The
adjustment has been made for the unrealized gain or loss from
Cash Flow Swap net of its related tax effect.
Net income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap is not a recognized term under GAAP and should not be
substituted for net income as a measure of our performance but
instead should be utilized as a supplemental measure of
financial performance in evaluating our business. Our
presentation of this non-GAAP measure may not be comparable to
similarly titled measures of other companies. We believe that
net income (loss) adjusted for unrealized gain or loss from Cash
Flow Swap is important to enable investors to better understand
and evaluate our ongoing operating results and allow for greater
transparency in the review of our overall business, financial,
operational and economic performance.
Year Ended December 31,
2009
2008
2007
(in millions)
$
94.1
$
11.2
$
(5.6
)
(24.7
)
152.7
(62.0
)
$
69.4
$
163.9
$
(67.6
)
57
Table of Contents
58
Table of Contents
59
Table of Contents
60
Table of Contents
61
Table of Contents
Year Ended December 31,
2009
2008
2007
(in millions)
$
2,934.9
$
4,774.3
$
2,806.2
2,514.3
4,449.4
2,300.2
141.6
151.4
209.5
0.6
6.4
36.7
64.4
62.7
43.0
$
214.0
$
104.4
$
216.8
141.6
151.4
209.5
0.6
6.4
36.7
64.4
62.7
43.0
$
420.6
$
324.9
$
506.0
$
$
42.8
$
$
170.2
$
31.9
$
144.9
Year Ended December 31,
2009
2008
2007
(dollars per barrel)
$
10.65
$
8.39
$
18.17
5.42
2.69
7.79
3.58
3.91
7.52
62
Table of Contents
Year Ended December 31,
2009
2008
2007
%
%
%
82,598
68.7
77,315
65.7
54,509
66.4
15,602
13.0
16,795
14.3
14,580
17.8
10,026
8.3
11,727
10.0
7,228
8.8
108,226
90.0
105,837
90.0
76,317
93.0
12,013
10.0
11,882
10.0
5,748
7.0
120,239
100.0
117,719
100.0
82,065
100.0
62,309
51.6
56,852
48.0
37,017
44.9
46,909
38.8
48,257
40.7
34,814
42.3
11,549
9.6
13,422
11.3
10,551
12.8
120,767
100.0
118,531
100.0
82,382
100.0
$
1.68
$
2.50
$
2.20
$
1.68
$
3.00
$
2.28
$
62.09
$
99.75
$
72.36
1.70
3.44
5.16
7.82
18.72
22.94
9.05
4.76
14.61
8.03
20.25
13.29
8.54
12.50
13.95
(1.25
)
0.12
3.56
0.03
4.22
7.95
7.81
4.88
18.18
8.06
24.47
21.24
7.93
14.68
19.71
(1)
In order to derive the gross profit per crude oil throughput
barrel, we utilize the total dollar figures for gross profit as
derived above and divide by the applicable number of crude oil
throughput barrels for the period. In order to derive the direct
operating expenses per crude oil throughput barrel, we utilize
the total direct operating expenses, which does not include
depreciation or amortization expense, and divide by the
applicable number of crude oil throughput barrels for the period.
(2)
Refining margin is a measurement calculated as the difference
between net sales and cost of product sold (exclusive of
depreciation and amortization). Refining margin is a non-GAAP
measure that we believe is important to investors in evaluating
our refinerys performance as a general indication of the
amount above
Table of Contents
our cost of product sold that we are able to sell refined
products. Each of the components used in this calculation (net
sales and cost of product sold (exclusive of depreciation and
amortization)) is taken directly from our Statements of
Operations. Our calculation of refining margin may differ from
similar calculations of other companies in our industry, thereby
limiting its usefulness as a comparative measure. In order to
derive the refining margin per crude oil throughput barrel, we
utilize the total dollar figures for refining margin as derived
above and divide by the applicable number of crude oil
throughput barrels for the period. We believe that refining
margin and refining margin per crude oil throughput barrel is
important to enable investors to better understand and evaluate
our ongoing operating results and for greater transparency in
the review of our overall business, financial, operational and
economic financial performance.
(3)
Upon applying the goodwill impairment testing criteria under
existing accounting rules during the fourth quarter of 2008, we
determined that the goodwill of the petroleum business was
impaired, which resulted in a goodwill impairment loss of
$42.8 million in the fourth quarter. This goodwill
impairment is included in the petroleum business operating
income but is excluded in the refining margin and the refining
margin per crude oil throughput barrel.
64
Table of Contents
65
Table of Contents
66
Table of Contents
Year Ended December 31,
2009
2008
2007
(in millions)
$
208.4
$
263.0
$
165.9
42.2
32.6
13.0
84.5
86.1
66.7
2.4
18.7
18.0
16.8
48.9
116.8
46.6
Year Ended December 31,
2009
2008
2007
435.2
359.1
326.7
156.6
112.5
91.8
677.7
599.2
576.9
483.5
451.9
449.8
$
27
$
31
$
30
159.9
99.4
92.1
686.0
594.2
555.4
845.9
693.6
647.5
67
Table of Contents
Year Ended December 31,
2009
2008
2007
$
314
$
557
$
376
$
198
$
303
$
211
97.4
%
87.8
%
90.0
%
96.5
%
86.2
%
87.7
%
94.1
%
83.4
%
78.7
%
$
21.3
$
18.9
$
13.9
0.8
9.0
186.3
235.1
152.0
$
208.4
$
263.0
$
165.9
Year Ended December 31,
2009
2008
2007
$
4.16
$
8.91
$
7.12
$
306
$
707
$
409
$
218
$
422
$
288
(1)
The gross tons produced for ammonia represent the total ammonia
produced, including ammonia produced that was upgraded into UAN.
The net tons available for sale represent the ammonia available
for sale that was not upgraded into UAN.
(2)
Plant gate sales per ton represent net sales less freight costs
and hydrogen revenue divided by product sales volume in tons in
the reporting period. Plant gate pricing per ton is shown in
order to provide a pricing measure that is comparable across the
fertilizer industry.
(3)
On-stream factor is the total number of hours operated divided
by the total number of hours in the reporting period. Excluding
the impact of turnarounds and the flood at the fertilizer
facility, (i) the on-stream factors in 2009 adjusted for
the Linde air separation unit outage would have been 99.3% for
gasifier, 98.4% for ammonia and 96.1% for UAN, (ii) the
on-stream factors in 2008 adjusted for turnaround would have
been 91.7% for gasifier, 90.2% for ammonia and 87.4% for UAN,
and (iii) the on-stream factors in 2007 adjusted for flood
would have been 94.6% for gasifier, 92.4% for ammonia and 83.9%
for UAN.
Table of Contents
69
Table of Contents
70
Table of Contents
71
Table of Contents
Tranche D term loans and revolving credit loans each bear
interest at either (a) the greater of the prime rate and
the federal funds effective rate plus 0.5%, plus in either case
the interest-rate margin (as discussed below) or, at the
borrowers option, (b) LIBOR plus the interest-rate
margin.
Revolving credit lenders each receive commitment fees equal to
the amount of undrawn revolving credit loans, multiplied by 0.5%
per annum.
Letters of credit issued under the $75.0 million
sub-limit
available under the revolving credit facility are subject to a
fee equal to the applicable margin on revolving LIBOR loans
owing to all revolving credit lenders and a fronting fee of
0.25% per annum owing to the issuing lender.
Permitted CRLLC to terminate the Cash Flow Swap with J. Aron and
to return to the lenders $60.0 million of funded letter of
credit deposits in connection therewith. CRLLC terminated the
funded letter of credit facility effective October 15, 2009.
Enables CRLLC and subsidiaries of CVR, which are parties to the
credit agreement, to pay up to $20 million in dividends
during any fiscal year to CVR (which is not a party to the
credit agreement) to allow CVR to make interest payments on any
indebtedness it may incur, subject to certain conditions.
Requires that 35% of net proceeds obtained through indebtedness
issued by CVR Energy, Inc. be used to prepay the tranche D
term loans.
Requires CRLLC to pay a premium on certain voluntary prepayments
and mandatory prepayments of the term loans in an amount equal
to (a) 2.00% for the
1-year
period after the effective date of the third amendment and
(b) 1.00% for the period beginning at the end of such
1-year
period and ending on the second anniversary of the effective
date of the third amendment.
72
Table of Contents
Reduces the percentage of consolidated excess cash flow that has
to be used to prepay loans from 100% to 75%. As such, 75% of
consolidated excess cash flow less 100% of voluntary prepayments
made during the fiscal year must be used to prepay outstanding
loans (excluding repayments of revolving or swing line loans).
Extends the application of the FIFO adjustment obtained in
connection with the second amendment through the remaining term
of the credit facility at a reduced level of 75%.
Provides greater flexibility with respect to the financial
covenants by adjusting the leverage ratio and interest coverage
ratio to 2.75:1.00 and 3.00:1.00, respectively, through the
remaining term of the credit facility.
Increases the interest-rate margin applicable to the loans by
0.50% if CRLLCs credit rating drops to the equivalent of a
CCC+ or worse.
Amends the definition of Change of Control.
73
Table of Contents
Minimum
Maximum
Interest
Leverage
Coverage Ratio
Ratio
3.00:1.00
2.75:1.00
74
Table of Contents
Year Ended December 31,
2009
2008(2)
2007(2)
(in millions)
$
69.4
$
163.9
$
(67.6
)
13.9
4.0
1.8
0.6
0.7
29.2
63.9
(88.5
)
1.8
(6.7
)
2.2
(0.1
)
(0.2
)
114.3
227.2
(153.2
)
84.9
82.2
68.4
44.2
40.3
60.5
2.1
10.0
0.6
13.4
7.4
1.8
3.3
76.4
37.8
(247.9
)
113.5
3.3
(10.5
)
25.0
5.8
1.3
2.7
10.3
10.9
11.6
(50.9
)
102.5
11.7
42.8
$
262.7
$
285.0
$
206.0
(1)
The second amendment to the credit facility entered into on
December 22, 2008 amended the definition of consolidated
adjusted EBITDA to add a FIFO adjustment. This amendment to the
definition first applied for the year ending December 31,
2008 and applied through the quarter ending September 30,
2009. The third amendment to the credit facility entered into on
October 2, 2009 permits CRLLC to continue to incorporate
the FIFO adjustment at a reduced level of 75% into its financial
covenant calculations through the remaining term of the credit
facility.
(2)
The 2008 and 2007 adjusted EBITDA amounts have been updated to
incorporate the reconciliation of CVR consolidated net income
(loss) to CRLLC consolidated net income (loss), for purposes of
comparability to the 2009 CRLLC consolidated adjusted EBITDA.
75
Table of Contents
76
Table of Contents
Year Ended December 31,
2009 Actual
2010 Budget
$
2.3
$
15.4
21.2
22.0
10.5
15.3
34.0
52.7
0.9
1.1
12.5
12.8
13.4
13.9
1.4
1.8
$
48.8
$
68.4
Year Ended December 31,
2009
2008
2007
(in millions)
$
85.3
$
83.2
$
145.9
(48.3
)
(86.5
)
(268.6
)
(9.0
)
(18.3
)
111.3
$
28.0
$
(21.6
)
$
(11.4
)
77
Table of Contents
78
Table of Contents
Payments Due by Period
Total
2010
2011
2012
2013
2014
Thereafter
(in millions)
$
479.5
$
4.8
$
4.7
$
4.7
$
465.3
$
$
21.6
5.4
5.4
5.0
2.6
1.9
1.3
4.4
4.4
300.5
32.1
30.5
27.7
27.8
27.8
154.6
5.8
2.2
0.4
0.4
0.3
0.4
2.1
148.5
41.1
40.6
40.4
26.4
$
960.3
$
90.0
$
81.6
$
78.2
$
522.4
$
30.1
$
158.0
$
63.8
$
$
$
$
$
$
79
Table of Contents
(1)
Long-term debt amortization is based on the contractual terms of
our credit facility and assumes no additional borrowings under
our revolving credit facility. We may be required to amend our
credit facility in connection with an offering by the
Partnership. As of December 31, 2009, $479.5 million
was outstanding under our credit facility. See
Liquidity and Capital Resources
Credit Facility. In January 2010, we made a
voluntary unscheduled principal payment of $20.0 million on
our tranche D term loans. In addition, we made a second
voluntary unscheduled principal payment of $5.0 million in
February 2010. Our outstanding term loan balance as of
March 8, 2010 was $453.3 million.
(2)
The nitrogen fertilizer business leases various facilities and
equipment, primarily railcars, under non-cancelable operating
leases for various periods.
(3)
This amount represents a capital lease for real property used
for corporate purposes.
(4)
The amount includes (a) commitments under several
agreements in our petroleum operations related to pipeline
usage, petroleum products storage and petroleum transportation
and (b) commitments under an electric supply agreement with
the city of Coffeyville.
(5)
This amount excludes approximately $510.0 million
potentially payable under petroleum transportation service
agreements with TransCanada, pursuant to which CRRM would
receive transportation of at least 25,000 barrels per day
of crude oil with a delivery point at Cushing, Oklahoma for a
term of 10 years on a new pipeline system being constructed
by TransCanada. This $510.0 million would be payable
ratably over the 10 year service period under the
agreements, such period to begin upon commencement of services
under the new pipeline system. Based on information currently
available to us, we believe commencement of services would begin
in the first quarter of 2011. The Company filed a Statement of
Claim in the Court of the Queens Bench of Alberta,
Judicial District of Calgary, on September 15, 2009, to
dispute the validity of the petroleum transportation service
agreements. The Company cannot provide any assurance that the
petroleum transportation service agreements will be found to be
invalid.
(6)
Environmental liabilities represents (a) our estimated
payments required by federal and/or state environmental agencies
related to closure of hazardous waste management units at our
sites in Coffeyville and Phillipsburg, Kansas and (b) our
estimated remaining costs to address environmental contamination
resulting from a reported release of UAN in 2005 pursuant to the
State of Kansas Voluntary Cleaning and Redevelopment Program. We
also have other environmental liabilities which are not
contractual obligations but which would be necessary for our
continued operations. See Business
Environmental Matters.
(7)
Interest payments are based on interest rates in effect at
December 31, 2009 and assume contractual amortization
payments.
(8)
Standby letters of credit include $0.2 million of letters
of credit issued in connection with environmental liabilities,
$30.6 million in letters of credit to secure transportation
services for crude oil, $5.0 million standby letter of
credit issued in support of the Interest Rate Swap and
$28.0 million standby letter of credit issued in support of
the purchase of feedstocks.
80
Table of Contents
81
Table of Contents
82
Table of Contents
Income Approach:
To determine fair value, we
discounted the expected future cash flows for each reporting
unit utilizing observable market data to the extent available.
The discount rate used was 13.4% representing the estimated
weighted-average costs of capital, which reflects the overall
level of inherent risk involved in each reporting unit and the
rate of return an outside investor would expect to earn.
Market-Based Approach:
To determine the fair
value of each reporting unit, we also utilized a market based
approach. We used the guideline company method, which focuses on
comparing our risk profile and growth prospects to select
reasonably similar publicly traded companies.
83
Table of Contents
Item 6A.
Quantitative
and Qualitative Disclosures About Market Risk
84
Table of Contents
lock in or fix a percentage of the anticipated or planned gross
margin in future periods when the derivative market offers
commodity spreads that generate positive cash flows;
hedge the value of inventories in excess of minimum required
inventories; and
manage existing derivative positions related to change in
anticipated operations and market conditions.
Time Basis
In entering
over-the-counter
swap agreements, the settlement price of the swap is typically
the average price of the underlying commodity for a designated
calendar period. This settlement price is based on the
assumption that the underlying physical commodity will price
ratably over the swap period. If the commodity does not move
ratably over the periods than weighted-average physical prices
will be weighted differently than the swap price as the result
of timing.
Location Basis
In hedging NYMEX crack
spreads, we experience location basis as the settlement of NYMEX
refined products (related more to New York Harbor cash markets)
which may be different than the prices of refined products in
our Group 3 pricing area.
From time to time, our petroleum segment also holds various
NYMEX positions through a third-party clearing house. At
December 31, 2009, we were short 525 WTI crude oil
contracts and short 20 unleaded gasoline contracts. At
December 31, 2009, our account balance maintained at the
third-party
85
Table of Contents
clearing house totaled approximately $7.7 million, of which
$2.7 million is reflected on the Consolidated Balance
Sheets in cash and cash equivalents and $5.0 million is
reflected in other current assets. Our NYMEX positions were in
an unrealized loss position of approximately $1.8 million
as of December 31, 2009. This unrealized loss is reflected
in the Consolidated Statement of Operations for the year ended
December 31, 2009 and in other current liabilities in our
Consolidated Balance Sheet at December 31, 2009. NYMEX
transactions conducted throughout 2009 resulted in realized
losses of approximately $6.6 million.
Effective
Termination
Fixed
Date
Date
Rate
March 31, 2009
March 30, 2010
4.195
%
March 31, 2010
June 29, 2010
4.195
%
86
Item 7.
Financial
Statements and Supplementary Data
Page
Number
88
89
90
91
92
94
95
87
Table of Contents
88
Table of Contents
89
Table of Contents
90
Table of Contents
Year Ended December 31,
2009
2008
2007
(in thousands, except share data)
$
3,136,329
$
5,016,103
$
2,966,864
2,547,695
4,461,808
2,308,740
226,043
237,469
276,137
68,918
35,239
93,122
614
7,863
41,523
84,873
82,177
60,779
42,806
2,928,143
4,867,362
2,780,301
208,186
148,741
186,563
(44,237
)
(40,313
)
(61,126
)
1,717
2,695
1,100
(65,286
)
125,346
(281,978
)
(2,101
)
(9,978
)
(1,258
)
310
1,355
356
(109,597
)
79,105
(342,906
)
98,589
227,846
(156,343
)
29,235
63,911
(88,515
)
210
$
69,354
$
163,935
$
(67,618
)
$
0.80
$
1.90
$
0.80
$
1.90
86,248,205
86,145,543
86,342,433
86,224,209
$
(0.78
)
$
(0.78
)
86,141,291
86,141,291
91
Table of Contents
Management Voting
Common Units
Subject to Redemption
Total
Units
Dollars
Dollars
(in thousands, except unit/share data)
201,063
$
6,981
$
6,981
2,037
2,037
(362
)
(362
)
(201,063
)
(8,656
)
(8,656
)
$
$
Management
Management
Nonvoting Override
Nonvoting Override
Total
Voting Common Units
Operating Units
Value Units
Members
Noncontrolling
Total
Units
Dollars
Units
Dollars
Units
Dollars
Equity
Interest
Equity
(in thousands, except unit/share data)
22,614,937
$
73,593
992,122
$
1,763
1,984,231
$
1,090
$
76,446
$
4,326
$
80,772
1,017
701
1,718
1,718
(2,037
)
(2,037
)
(2,037
)
(210
)
(210
)
(1,053
)
(1,053
)
1,053
1,053
1,053
(5,169
)
(4,116
)
(40,756
)
(40,756
)
(40,756
)
(22,614,937
)
(30,800
)
(992,122
)
(2,780
)
(1,984,231
)
(1,791
)
(35,371
)
(35,371
)
$
$
$
$
$
$
92
Table of Contents
Common Stock
Additional
Retained
Total CVR
Shares
Paid-In
Earnings
Treasury
Stockholders
Noncontrolling
Total
Issued
Amount
Capital
(Deficit)
Stock
Equity
Interest
Equity
(in thousands, except unit/share data)
$
$
$
$
$
$
$
62,866,720
629
43,398
44,027
44,027
247,471
2
4,700
4,702
4,702
(10,600
)
(10,600
)
(10,600
)
10,600
10,600
22,917,300
229
395,326
395,555
395,555
82,700
1
1,570
1,571
1,571
23,399
23,399
23,399
27,100
566
566
566
(26,500
)
(26,500
)
(26,500
)
86,141,291
$
861
$
458,359
$
(26,500
)
$
$
432,720
$
10,600
$
443,320
(17,789
)
(17,789
)
(17,789
)
96,620
1
399
400
400
5,834
201
201
201
163,935
163,935
163,935
86,243,745
$
862
$
441,170
$
137,435
$
$
579,467
$
10,600
$
590,067
4,614
4,614
4,614
73,284
1
479
480
480
27,479
(100
)
(100
)
(100
)
69,354
69,354
69,354
86,344,508
$
863
$
446,263
$
206,789
$
(100
)
$
653,815
$
10,600
$
664,415
93
Table of Contents
Year Ended December 31,
2009
2008
2007
(in thousands)
$
69,354
$
163,935
$
(67,618
)
84,873
82,177
68,406
644
3,737
15
1,941
1,991
2,778
41
5,795
1,272
2,101
9,978
1,258
7,935
(42,523
)
44,083
1,567
2,539
(210
)
42,806
34,560
(34,560
)
(13,057
)
49,493
(16,972
)
(126,414
)
97,989
(84,980
)
12,104
(19,064
)
4,848
(1,681
)
(105,260
)
11,756
74,185
20,000
862
(3,751
)
3,246
5,650
(59,392
)
59,110
19,996
(9,487
)
732
4,541
(7,413
)
4,349
(85
)
(5,319
)
27,027
(24,113
)
(326,532
)
240,944
(1,412
)
(604
)
(551
)
1,279
1,492
1,122
(7,282
)
55,846
(57,684
)
85,274
83,204
145,915
(48,773
)
(86,458
)
(268,593
)
481
(48,292
)
(86,458
)
(268,593
)
(87,200
)
(453,200
)
(345,800
)
87,200
453,200
345,800
50,000
(4,825
)
(4,874
)
(335,797
)
(100
)
(940
)
(3,975
)
(8,522
)
(2,491
)
(100
)
(2,429
)
(1,567
)
399,556
(10,600
)
10,600
(9,000
)
(18,332
)
111,268
27,982
(21,586
)
(11,410
)
8,923
30,509
41,919
$
36,905
$
8,923
$
30,509
$
16,521
$
17,551
$
(31,563
)
$
40,537
$
43,802
$
44,837
$
$
$
586
$
(5,040
)
$
(16,972
)
$
(15,268
)
$
$
4,827
$
94
Table of Contents
(1)
Organization
and History of the Company
95
Table of Contents
96
Table of Contents
(2)
Summary
of Significant Accounting Policies
97
Table of Contents
Range of Useful
Lives, in Years
15 to 20
20 to 30
5 to 30
5
3 to 7
98
Table of Contents
99
Table of Contents
100
Table of Contents
101
Table of Contents
102
Table of Contents
103
Table of Contents
(3)
Share-Based
Compensation
*Compensation Expense Increase
Benchmark
Original
(Decrease) for the Year Ended
Value
Awards
December 31,
(per Unit)
Issued
Grant Date
2009
2008
2007
$
11.31
919,630
June 2005
$
1,369
$
(5,979
)
$
10,675
$
34.72
72,492
December 2006
36
(430
)
877
$
11.31
1,839,265
June 2005
2,690
(11,063
)
12,788
$
34.72
144,966
December 2006
37
(493
)
718
$
10.00
138,281
October 2007
(2
)
2
$
10.00
642,219
February 2008
26
5
Total
$
4,158
$
(17,962
)
$
25,060
*
As CVRs common stock price increases or decreases,
compensation expense increases or is reversed in correlation
with the calculation of the fair value under the
probability-weighted expected return method.
104
Table of Contents
(a) Override Operating Units
(b) Override Operating Units
December 31,
December 31,
2009
2008
2007
2009
2008
2007
None
None
None
None
None
None
$
6.86
$
4.00
$
24.94
$
6.86
$
4.00
$
24.94
$
11.95
$
8.25
$
51.84
$
1.40
$
1.59
$
32.65
20
%
15
%
15
%
20
%
15
%
15
%
50.7
%
68.8
%
35.8
%
50.7
%
68.8
%
35.8
%
Forfeiture
Percentage
75%
50%
25%
0%
(c) Override Value Units
(d) Override Value Units
December 31,
December 31,
2009
2008
2007
2009
2008
2007
None
None
None
None
None
None
6 years
6 years
6 years
6 years
6 years
6 years
$
6.86
$
4.00
$
24.94
$
6.86
$
4.00
$
24.94
$
5.63
$
3.20
$
51.84
$
1.39
$
1.59
$
32.65
20
%
15
%
15
%
20
%
15
%
15
%
50.7
%
68.8
%
35.8
%
50.7
%
68.8
%
35.8
%
Forfeiture
Percentage
75
%
50
%
25
%
0
%
105
Table of Contents
None
$0.02 per unit
15% discount
34.7%
December 31,
2009
2008
None
None
Based on forfeiture schedule
Based on forfeiture schedule
$0.08 per unit
$0.02 per unit
20% discount
20% discount
59.7%
64.3%
Override
Override
Operating Units
Value Units
220,000
1,677,000
799,000
$
220,000
$
2,476,000
106
Table of Contents
107
Table of Contents
Weighted-
Average
Aggregate Intrinsic
Grant-Date
Value
Shares
Fair Value
(in thousands)
$
$
17,500
20.88
17,500
$
20.88
$
436
163,620
4.14
(102,454
)
5.09
78,660
$
6.62
$
315
202,257
6.68
(100,763
)
6.86
(3,100
)
4.14
177,060
$
6.59
$
1,215
108
Table of Contents
Weighted-
Weighted-
Average
Average
Remaining
Exercise
Contractual
Shares
Price
Term
$
18,900
21.61
18,900
$
21.61
9.89
13,450
15.52
32,350
$
19.08
9.21
32,350
$
19.08
8.21
17,087
20.01
8.21
(4)
Inventories
December 31,
2009
2008
$
123,548
$
61,008
107,840
45,928
19,401
14,376
24,049
27,112
$
274,838
$
148,424
109
Table of Contents
(5)
Property,
Plant, and Equipment
December 31,
2009
2008
$
18,016
$
17,383
23,316
22,851
1,305,362
1,288,782
8,796
7,825
8,095
7,835
1,301
1,081
77,818
53,927
1,442,704
1,399,684
304,794
220,719
$
1,137,910
$
1,178,965
(6)
Goodwill
and Intangible Assets
Income Approach:
To determine fair value, the
Company discounted the expected future cash flows for each
reporting unit utilizing observable market data to the extent
available. The discount rates used was 13.4% representing the
estimated weighted-average costs of capital, which reflects the
overall level of inherent risk involved in each reporting unit
and the rate of return an outside investor would expect to earn.
110
Table of Contents
Market-Based Approach:
To determine the fair
value of each reporting unit, the Company also utilized a market
based approach. The Company used the guideline company method,
which focuses on comparing the Companys risk profile and
growth prospects to select reasonably similar publicly traded
companies.
Contractual
Agreements
33
33
28
27
27
229
377
(7)
Deferred
Financing Costs
111
Table of Contents
Year Ended December 31,
2009
2008
$
6,976
$
8,045
1,941
1,991
5,035
6,054
1,550
2,171
$
3,485
$
3,883
Year Ending
Deferred
Financing
$
1,550
1,544
1,534
407
$
5,035
(8)
Note
Payable and Capital Lease Obligations
112
Table of Contents
(9)
Flood
(10)
Income
Taxes
Year Ended
December 31,
2009
2008
2007
$
33,651
$
8,474
$
(26,814
)
2,866
(409
)
(4,017
)
36,517
8,065
(30,831
)
(6,613
)
57,236
(21,434
)
(669
)
(1,390
)
(36,250
)
(7,282
)
55,846
(57,684
)
$
29,235
$
63,911
$
(88,515
)
113
Table of Contents
Year Ended
December 31,
2009
2008
2007
$
34,506
$
79,746
$
(54,720
)
5,402
13,372
(6,382
)
(3,205
)
(14,519
)
(19,792
)
(3,798
)
(913
)
(4,783
)
(23,742
)
(17,259
)
1,457
(6,286
)
8,771
14,982
(344
)
1,271
867
$
29,235
$
63,911
$
(88,515
)
114
Table of Contents
Year Ended
December 31,
2009
2008
(in thousands)
$
1,918
$
1,638
4,822
2,564
938
426
1,856
31,719
50,263
854
203
234
29,887
31,994
3,280
3,388
2,096
2,276
792
256
77,511
93,893
(330,477
)
(340,292
)
(3,537
)
(4,247
)
(13,139
)
(334,014
)
(357,678
)
$
(256,503
)
$
(263,785
)
115
Table of Contents
$
0
$
0
(11)
Long-Term
Debt
116
Table of Contents
Minimum
Interest
Maximum
Coverage Ratio
Leverage Ratio
3.00:1.00
2.75:1.00
117
Table of Contents
Year Ending
December 31,
Amount
2010
$
4,777,000
2011
4,730,000
2012
4,682,000
2013
465,314,000
2014
Thereafter
$
479,503,000
(12)
Earnings
Per Share
118
Table of Contents
For the Year
Ended December 31,
2009
2008
(unaudited)
(in thousands except share data)
$
69,354
$
163,935
86,248,205
86,145,543
94,228
78,666
86,342,433
86,224,209
$
0.80
$
1.90
$
0.80
$
1.90
For the Year
Ended December 31,
2007
(unaudited)
(in thousands)
$
(67,618
)
100
62,866,620
247,471
27,100
23,000,000
86,141,291
86,141,291
$
(0.78
)
$
(0.78
)
119
Table of Contents
(13)
Benefit
Plans
(14)
Commitments
and Contingent Liabilities
Year Ending
Operating
Unconditional
Leases
Purchase Obligations(1)
$
5,404
$
32,065
5,406
30,487
4,998
27,692
2,555
27,846
1,891
27,846
1,357
154,577
$
21,611
$
300,513
(1)
This amount excludes approximately $510,000,000 potentially
payable under petroleum transportation service agreements with
TransCanada Keystone Pipeline, LP (TransCanada),
pursuant to which Coffeyville Resources Refining &
Marketing, LLC (CRRM) would receive transportation
of at least 25,000 barrels per day of crude oil with a
delivery point at Cushing, Oklahoma for a term of ten years on a
new pipeline system being constructed by TransCanada. This
$510,000,000 would be payable ratably over the ten year service
period under the agreements, such period to begin upon
commencement of services under the new pipeline system. Based on
information currently available to us, we believe commencement
of services would begin in the first quarter of 2011. The
Company filed a Statement of Claim in the Court of the
Queens Bench of Alberta, Judicial District of Calgary, on
September 15, 2009, to dispute the validity of the
petroleum transportation service agreements. The Company cannot
provide any assurance that the petroleum transportation service
agreements will be found to be invalid.
120
Table of Contents
121
Table of Contents
122
Table of Contents
123
Table of Contents
124
Table of Contents
Amount
$
2,179
370
435
325
431
2,023
5,763
756
$
5,007
125
Table of Contents
(15)
Fair
Value Measurements
126
Table of Contents
Level 1 Quoted prices in active market for
identical assets and liabilities
Level 2 Other significant observable inputs
(including quoted prices in active markets for similar assets or
liabilities)
Level 3 Significant unobservable inputs
(including the Companys own assumptions in determining the
fair value)
2009
Level 1
Level 2
Level 3
Total
$
723
$
$
723
(2,830
)
(2,830
)
(1,847
)
(1,847
)
2008
Level 1
Level 2
Level 3
Total
$
149
$
$
149
(7,789
)
(7,789
)
32,630
32,630
5,632
5,632
127
Table of Contents
(16)
Derivative
Financial Instruments
Year Ended
December 31,
2009
2008
2007
(in thousands)
$
(14,331
)
$
(110,388
)
$
(157,239
)
(40,903
)
253,195
(103,212
)
(6,646
)
(10,582
)
(15,346
)
(1,847
)
634
(1,348
)
(6,518
)
(1,593
)
4,115
4,959
(5,920
)
(8,948
)
$
(65,286
)
$
125,346
$
(281,978
)
128
Table of Contents
Notional
Fixed
Amount
Interest Rate
180 million
4.195
%
110 million
4.195
%
(17)
Related
Party Transactions
129
Table of Contents
130
Table of Contents
(18)
Business
Segments
131
Table of Contents
132
Table of Contents
Year Ended December 31,
2009
2008
2007
(in thousands)
$
2,934,904
$
4,774,337
$
2,806,203
208,371
262,950
165,856
(6,946
)
(21,184
)
(5,195
)
$
3,136,329
$
5,016,103
$
2,966,864
$
2,514,293
$
4,449,422
$
2,300,226
42,158
32,574
13,042
(8,756
)
(20,188
)
(4,528
)
$
2,547,695
$
4,461,808
$
2,308,740
$
141,590
$
151,377
$
209,474
84,453
86,092
66,663
$
226,043
$
237,469
$
276,137
$
614
$
6,380
$
36,669
27
2,432
1,456
2,422
$
614
$
7,863
$
41,523
$
64,424
$
62,690
$
43,040
18,685
17,987
16,819
1,764
1,500
920
$
84,873
$
82,177
$
60,779
$
$
42,806
$
$
$
42,806
$
133
Table of Contents
Year Ended December 31,
2009
2008
2007
(in thousands)
170,184
31,902
144,876
48,863
116,807
46,593
(10,861
)
32
(4,906
)
$
208,186
$
148,741
$
186,563
$
34,018
$
60,410
$
261,562
13,389
24,076
6,488
1,366
1,972
543
$
48,773
$
86,458
$
268,593
$
1,082,707
$
1,032,223
$
1,277,124
702,929
644,301
446,763
(171,142
)
(66,041
)
144,469
$
1,614,494
$
1,610,483
$
1,868,356
$
$
$
42,806
40,969
40,969
40,969
$
40,969
$
40,969
$
83,775
(19)
Major
Customers and Suppliers
Year Ended
December 31,
2009
2008
2007
14
%
13
%
12
%
0
%
3
%
7
%
10
%
10
%
9
%
11
%
9
%
10
%
35
%
35
%
38
%
15
%
13
%
18
%
Table of Contents
Year Ended
December 31,
2009
2008
2007
%
67
%
63
%
69
%
%
%
Year Ended
December 31,
2009
2008
2007
5
%
5
%
5
%
135
Table of Contents
(20)
Selected
Quarterly Financial and Information (unaudited)
Year Ended December 31, 2009
Quarter
First
Second
Third
Fourth
(in thousands except share data)
$
609,395
$
793,304
$
811,693
$
921,937
421,605
587,635
712,730
825,725
56,234
54,447
58,419
56,943
19,506
21,772
29,165
(1,525
)
181
(101
)
529
5
20,909
21,107
21,634
21,223
518,435
684,860
822,477
902,371
90,960
108,444
(10,784
)
19,566
(11,470
)
(11,191
)
(10,932
)
(10,644
)
14
653
475
575
(36,861
)
(29,233
)
3,116
(2,308
)
(677
)
(1,424
)
25
173
82
30
(48,292
)
(40,275
)
(7,259
)
(13,771
)
42,668
68,169
(18,043
)
5,795
12,007
25,500
(4,604
)
(3,668
)
$
30,661
$
42,669
$
(13,439
)
$
9,463
$
0.36
$
0.49
$
(0.16
)
$
0.11
$
0.36
$
0.49
$
(0.16
)
$
0.11
86,243,745
86,244,152
86,244,245
86,260,539
86,322,411
86,333,349
86,244,245
86,369,127
136
Table of Contents
Year Ended December 31, 2008
Quarter
First
Second
Third
Fourth
(in thousands except share data)
$
1,223,003
$
1,512,503
$
1,580,911
$
699,686
1,036,194
1,287,477
1,440,355
697,782
60,556
62,336
56,575
58,002
13,497
14,762
(7,820
)
14,800
5,763
3,896
(817
)
(979
)
19,635
21,080
20,609
20,853
42,806
1,135,645
1,389,551
1,508,902
833,264
87,358
122,952
72,009
(133,578
)
(11,298
)
(9,460
)
(9,333
)
(10,222
)
702
601
257
1,135
(47,871
)
(79,305
)
76,706
175,816
(9,978
)
179
251
428
497
(58,288
)
(87,913
)
68,058
157,248
29,070
35,039
140,067
23,670
6,849
4,051
40,411
12,600
$
22,221
$
30,988
$
99,656
$
11,070
$
0.26
$
0.36
$
1.16
$
0.13
$
0.26
$
0.36
$
1.16
$
0.13
86,141,291
86,141,291
86,141,291
86,158,206
86,158,791
86,158,791
86,158,791
86,236,872
137
Table of Contents
(21)
Subsequent
Events
138
Table of Contents
Item 8.
Changes
in and Disagreements With Accountants on Accounting and
Financial Disclosure
Item 8A.
Controls
and Procedures
Item 8B.
Other
Information
Item 9.
Directors,
Executive Officers and Corporate Governance
Item 10.
Executive
Compensation
139
Table of Contents
Item 11.
Security
Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
Item 12.
Certain
Relationships and Related Transactions, and Director
Independence
Item 13.
Principal
Accounting Fees and Services
Item 14.
Exhibits
and Financial Statement Schedules
Exhibit
Amended and Restated Certificate of Incorporation of CVR Energy,
Inc. (filed as Exhibit 10.1 to the Companys Quarterly
Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated herein by reference).
Amended and Restated Bylaws of CVR Energy, Inc. (filed as
Exhibit 10.2 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated herein by reference).
Specimen Common Stock Certificate (filed as Exhibit 4.1 to
the Companys Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Second Amended and Restated Credit and Guaranty Agreement, dated
as of December 28, 2006, among Coffeyville Resources, LLC
and the other parties thereto (filed as Exhibit 10.1 to the
Companys Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
140
Table of Contents
Exhibit
First Amendment to Second Amended and Restated Credit and
Guaranty Agreement, dated as of August 23, 2007, among
Coffeyville Resources, LLC and the other parties thereto (filed
as Exhibit 10.1.1 to the Companys Registration
Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Second Amendment to Second Amended and Restated Credit and
Guaranty Agreement dated December 22, 2008 between
Coffeyville Resources, LLC and the other parties thereto (filed
as Exhibit 10.1 to the Companys Current Report on
Form 8-K,
filed on December 23, 2008 and incorporated herein by
reference).
Third Amendment to Second Amended and Restated Credit and
Guaranty Agreement, dated October 2, 2009, among
Coffeyville Resources, LLC and the other parties thereto (filed
as Exhibit 10.1 to the Companys Current Report on
Form 8-K,
filed on October 5, 2009 and incorporated herein by
reference).
Amended and Restated First Lien Pledge and Security Agreement,
dated as of December 28, 2006, among Coffeyville Resources,
LLC, CL JV Holdings, LLC, Coffeyville Pipeline, Inc.,
Coffeyville Refining and Marketing, Inc., Coffeyville Nitrogen
Fertilizers, Inc., Coffeyville Crude Transportation, Inc.,
Coffeyville Terminal, Inc., Coffeyville Resources Pipeline, LLC,
Coffeyville Resources Refining & Marketing, LLC,
Coffeyville Resources Nitrogen Fertilizers, LLC, Coffeyville
Resources Crude Transportation, LLC and Coffeyville Resources
Terminal, LLC, as grantors, and Credit Suisse, as collateral
agent (filed as Exhibit 10.2 to the Companys
Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
License Agreement For Use of the Texaco Gasification Process,
Texaco Hydrogen Generation Process, and Texaco Gasification
Power Systems, dated as of May 30, 1997 by and between
Texaco Development Corporation and Farmland Industries, Inc., as
amended (filed as Exhibit 10.4 to the Companys
Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Amended and Restated
On-Site
Product Supply Agreement dated as of June 1, 2005, between
Linde, Inc. (f/k/a The BOC Group, Inc.) and Coffeyville
Resources Nitrogen Fertilizers, LLC (filed as Exhibit 10.6
to the Companys Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
First Amendment to Amended and Restated
On-Site
Product Supply Agreement, dated as of October 31, 2008,
between Coffeyville Resources Nitrogen Fertilizers, LLC and
Linde, Inc. (filed as Exhibit 10.3 to the Companys
Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2008 and
incorporated by reference herein).
Crude Oil Supply Agreement dated December 2, 2008 between
Vitol Inc. and Coffeyville Resources Refining &
Marketing, LLC (filed as Exhibit 10.6 to the Companys
Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008 and
incorporated by reference herein).
First Amendment to Crude Oil Supply Agreement dated
January 1, 2009 between Vitol Inc. and Coffeyville
Resources Refining & Marketing, LLC (filed as
Exhibit 10.6.1 to the Companys Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008 and
incorporated by reference herein).
Second Amendment to Crude Oil Supply Agreement dated
July 7, 2009 between Vitol Inc. and Coffeyville Resources
Refining & Marketing, LLC (filed as Exhibit 10.3
to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended June 30, 2009 and
incorporated by reference herein).
Pipeline Construction, Operation and Transportation Commitment
Agreement, dated February 11, 2004, as amended, between
Plains Pipeline, L.P. and Coffeyville Resources
Refining & Marketing, LLC (filed as Exhibit 10.14
to the Companys Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Table of Contents
Exhibit
Electric Services Agreement dated January 13, 2004, between
Coffeyville Resources Nitrogen Fertilizers, LLC and the City of
Coffeyville, Kansas (filed as Exhibit 10.15 to the
Companys Registration Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Stockholders Agreement of CVR Energy, Inc., dated as of
October 16, 2007, by and among CVR Energy, Inc.,
Coffeyville Acquisition LLC and Coffeyville Acquisition II
LLC (filed as Exhibit 10.20 to the Companys Quarterly
Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Registration Rights Agreement, dated as of October 16,
2007, by and among CVR Energy, Inc., Coffeyville Acquisition LLC
and Coffeyville Acquisition II LLC (filed as
Exhibit 10.21 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Management Registration Rights Agreement, dated as of
October 24, 2007, by and between CVR Energy, Inc. and John
J. Lipinski (filed as Exhibit 10.27 to the Companys
Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
First Amended and Restated Agreement of Limited Partnership of
CVR Partners, LP, dated as of October 24, 2007, by and
among CVR GP, LLC and Coffeyville Resources, LLC (filed as
Exhibit 10.4 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated herein by reference).
Coke Supply Agreement, dated as of October 25, 2007, by and
between Coffeyville Resources Refining & Marketing,
LLC and Coffeyville Resources Nitrogen Fertilizers, LLC (filed
as Exhibit 10.5 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated herein by reference).
Cross Easement Agreement, dated as of October 25, 2007, by
and between Coffeyville Resources Refining &
Marketing, LLC and Coffeyville Resources Nitrogen Fertilizers,
LLC (filed as Exhibit 10.6 to the Companys Quarterly
Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Environmental Agreement, dated as of October 25, 2007, by
and between Coffeyville Resources Refining &
Marketing, LLC and Coffeyville Resources Nitrogen Fertilizers,
LLC (filed as Exhibit 10.7 to the Companys Quarterly
Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Supplement to Environmental Agreement, dated as of
February 15, 2008, by and between Coffeyville Resources
Refining and Marketing, LLC and Coffeyville Resources Nitrogen
Fertilizers, LLC (filed as Exhibit 10.17.1 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
Second Supplement to Environmental Agreement, dated as of
July 23, 2008, by and between Coffeyville Resources
Refining and Marketing, LLC and Coffeyville Resources Nitrogen
Fertilizers, LLC (filed as Exhibit 10.1 to the
Companys Quarterly Report on
Form 10-Q
for the quarterly period ended June 30, 2008 and
incorporated by reference herein).
Feedstock and Shared Services Agreement, dated as of
October 25, 2007, by and between Coffeyville Resources
Refining & Marketing, LLC and Coffeyville Resources
Nitrogen Fertilizers, LLC (filed as Exhibit 10.8 to the
Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Amendment to Feedstock and Shared Services Agreement, dated
July 24, 2009, by and between Coffeyville Resources
Refining & Marketing, LLC and Coffeyville Resources
Nitrogen Fertilizers, LLC (filed as Exhibit 10.2 to the
Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2009 and
incorporated by reference herein).
Raw Water and Facilities Sharing Agreement, dated as of
October 25, 2007, by and between Coffeyville Resources
Refining & Marketing, LLC and Coffeyville Resources
Nitrogen Fertilizers, LLC (filed as Exhibit 10.9 to the
Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Table of Contents
Exhibit
Services Agreement, dated as of October 25, 2007, by and
among CVR Partners, LP, CVR GP, LLC, CVR Special GP, LLC, and
CVR Energy, Inc. (filed as Exhibit 10.10 to the
Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Omnibus Agreement, dated as of October 24, 2007 by and
among CVR Energy, Inc., CVR GP, LLC, CVR Special GP, LLC and CVR
Partners, LP (filed as Exhibit 10.11 to the Companys
Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Registration Rights Agreement, dated as of October 24,
2007, by and among CVR Partners, LP, CVR Special GP, LLC and
Coffeyville Resources, LLC (filed as Exhibit 10.24 to the
Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2007 and
incorporated by reference herein).
Amended and Restated Employment Agreement, dated as of
January 1, 2008, by and between CVR Energy, Inc. and John
J. Lipinski (filed as Exhibit 10.24 to the Companys
Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
Amended and Restated Employment Agreement, dated as of
December 29, 2007, by and between CVR Energy, Inc. and
Stanley A. Riemann (filed as Exhibit 10.25 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
Employment Agreement, dated as of April 1, 2009, by and
between CVR Energy, Inc. and Edward Morgan (filed as
Exhibit 10.1 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended June 30, 2009 and
incorporated by reference herein).
Amendment to Employment Agreement, dated August 17, 2009,
by and between CVR Energy, Inc. and Edward Morgan (filed as
Exhibit 10.3 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2009 and
incorporated by reference herein).
Amended and Restated Employment Agreement, dated as of
December 29, 2007, by and between CVR Energy, Inc. and
Edmund S. Gross (filed as Exhibit 10.46 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2008 and incorporated by
reference herein).
Amended and Restated Employment Agreement, dated as of
December 29, 2007, by and between CVR Energy, Inc. and
Robert W. Haugen (filed as Exhibit 10.28 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
Amended and Restated Employment Agreement, dated as of
December 29, 2007, by and between CVR Energy, Inc. and
Wyatt E. Jernigan (filed as Exhibit 10.44 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2008 and incorporated by
reference herein).
Amended and Restated Employment Agreement, dated as of
December 29, 2007, by and between CVR Energy, Inc. and
Kevan A. Vick (filed as Exhibit 10.43 to the Companys
Annual Report on
Form 10-K
for the year ended December 31, 2008 and incorporated by
reference herein).
Employment Agreement, dated as of October 23, 2007, by and
between CVR Energy, Inc. and Daniel J. Daly, Jr. (filed as
Exhibit 10.27 to the Companys Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
First Amendment to Employment Agreement, dated as of
November 30, 2007, by and between CVR Energy, Inc. and
Daniel J. Daly, Jr. (filed as Exhibit 10.27.1 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
Second Amendment to Employment Agreement, dated as of
August 17, 2009, by and between CVR Energy, Inc. and Daniel
J. Daly, Jr. (filed as Exhibit 10.4 to the Companys
Quarterly Report on
Form 10-Q
for the quarterly period ended September 30, 2009 and
incorporated by reference herein).
Table of Contents
Exhibit
Amended and Restated CVR Energy, Inc. 2007 Long-Term Incentive
Plan, dated as of December 18, 2009.
Form of Nonqualified Stock Option Agreement (filed as
Exhibit 10.33.1 to the Companys Registration
Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Form of Director Stock Option Agreement (filed as
Exhibit 10.33.2 to the Companys Registration
Statement on
Form S-1,
File
No. 333-137588
and incorporated herein by reference).
Form of Director Restricted Stock Agreement.
Form of Restricted Stock Agreement.
Amended and Restated Coffeyville Resources, LLC Phantom Unit
Appreciation Plan (Plan I), dated as of November 9, 2009.
Amended and Restated Coffeyville Resources, LLC Phantom Unit
Appreciation Plan (Plan II), dated as of November 9, 2009.
Fourth Amended and Restated Limited Liability Company Agreement
of Coffeyville Acquisition LLC, dated as of November 9,
2009.
Second Amended and Restated Limited Liability Company Agreement
of Coffeyville Acquisition II LLC, dated as of
November 9, 2009.
Amended and Restated Limited Liability Company Agreement of
Coffeyville Acquisition III LLC, dated as of
February 15, 2008 (filed as Exhibit 10.41 to the
Companys Annual Report on
Form 10-K
for the year ended December 31, 2007 and incorporated by
reference herein).
Consulting Agreement, dated May 2, 2008, by and between
General Wesley Clark and CVR Energy, Inc. (filed as
Exhibit 10.1 to the Companys Quarterly Report on
Form 10-Q
for the quarterly period ended March 31, 2008 and
incorporated by reference herein).
Separation Agreement dated January 23, 2009 between James
T. Rens, CVR Energy, Inc. and Coffeyville Resources, LLC (filed
as Exhibit 10.47 to the Companys Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008 and
incorporated by reference herein).
LLC Unit Agreement dated January 23, 2009 between
Coffeyville Acquisition, LLC, Coffeyville Acquisition II, LLC,
Coffeyville Acquisition III, LLC and James T. Rens (filed as
Exhibit 10.48 to the Companys Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008 and
incorporated by reference herein).
Form of Indemnification Agreement between CVR Energy, Inc. and
each of its directors and officers (filed as Exhibit 10.49
to the Companys Annual Report on
Form 10-K
for the fiscal year ended December 31, 2008 and
incorporated by reference herein).
Computation of Ratio of Earnings to Fixed Charges is attached
hereto as Exhibit 12.1.
List of Subsidiaries of CVR Energy, Inc.
Consent of KPMG LLP.
Rule 13a-14(a)/15d-14(a)
Certification of Chief Executive Officer.
Rule 13a-14(a)/15d-14(a)
Certification of Chief Financial Officer.
Section 1350 Certification of Chief Executive Officer and
Chief Financial Officer.
*
Filed herewith.
**
Previously filed.
Certain portions of this exhibit have been omitted and
separately filed with the SEC pursuant to a request for
confidential treatment which has been granted by the SEC.
++
Denotes management contract or compensatory plan or arrangement
required to be filed as an exhibit to this Report pursuant to
Item 14(a)(3) of this Report.
Table of Contents
145
Table of Contents
By:
Title:
Chief Executive Officer
Chairman of the Board of Directors, Chief Executive Officer and
President (Principal Executive Officer)
March 12, 2010
Chief Financial Officer and Treasurer (Principal Financial and
Accounting Officer)
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
Director
March 12, 2010
146
- 2 -
- 3 -
- 4 -
- 5 -
- 6 -
- 7 -
- 8 -
- 9 -
- 10 -
- 11 -
- 12 -
- 13 -
- 14 -
- 15 -
- 16 -
- 17 -
- 18 -
- 19 -
- 20 -
- 21 -
- 22 -
- 23 -
- 24 -
- 25 -
- 26 -
- 27 -
2
3
CVR ENERGY, INC. | GRANTEE | |||||
|
||||||
|
||||||
By:
|
John J. Lipinski | Print Name: | ||||
Title:
|
Chief Executive Officer and President |
2
3
4
CVR ENERGY, INC. | GRANTEE | |||||
|
||||||
|
||||||
By:
|
John J. Lipinski | Print Name: | ||||
Title:
|
Chief Executive Officer and President |
1. | Purpose; Operation . The purpose of the Amended and Restated Coffeyville Resources, LLC Phantom Unit Appreciation Plan (Plan I) (the Plan) is to provide an incentive to employees of the Company and its Affiliates who contribute to the Companys success to increase their efforts on behalf of the Company and to promote the success of the Companys business. Participants in the Plan have the opportunity to receive cash payments in respect of Phantom Points they hold in the event of certain distributions pursuant to the Parent LLC Agreement to Members (as defined in the Parent LLC Agreement) in Coffeyville Acquisition LLC, an indirect equity owner of the Company. Whether payments will be made will depend on the amount of net proceeds realized in connection with the event that gives rise to such distributions. Defined terms are defined in Exhibit A hereto. | |
2. | Administration . The Plan shall be administered by the Committee. The Committee shall have the authority in its discretion, subject to and not inconsistent with the express provisions of the Plan, to administer the Plan and to exercise all the powers and authorities either specifically granted to it under the Plan or necessary or advisable in the administration of the Plan, including, without limitation: |
| the authority to grant Phantom Points; | ||
| to determine the persons to whom and the time or times at which Phantom Points shall be granted; | ||
| to determine the number and type of Phantom Points to be granted and the terms, conditions and restrictions relating thereto; | ||
| to determine whether, to what extent, and under what circumstances Phantom Points may be settled, cancelled, forfeited, exchanged, or surrendered; | ||
| to make adjustments in the terms and conditions applicable to Phantom Points; | ||
| to construe and interpret the Plan and Award Agreements; | ||
| to prescribe, amend and rescind rules and regulations relating to the Plan; | ||
| to determine the terms and provisions of the Award Agreements; | ||
| to determine the Baseline Primary Phantom Percentage, the Total Phantom Percentages and the Final Phantom Percentages; | ||
| to determine the amounts allocable for payment pursuant to this Plan; |
| to assign Phantom Benchmark Amounts; and | ||
| to make all other determinations deemed necessary or advisable for the administration of the Plan. |
All determinations made by the Committee in respect of the Plan shall be final and binding on all Participants and their beneficiaries. No manager or member of the Company or member of the Committee shall be liable for any action taken or determination made in good faith with respect to the Plan or any Phantom Points granted hereunder. The Committee, with the consent of Parent LLC, shall make determinations with respect to percentages (including the Total Phantom Percentages and the Final Phantom Percentages) and cash amounts allocated, if any, to the Plan with reference to the applicable definitions set forth in Exhibit A ; provided that any and all determinations with respect to applicable percentages and cash amounts allocated to the Plan shall be made in the Committees discretion and may vary from such definitions. The Committee may make adjustments in the operation of provisions of the Plan if the Committee determines in its sole discretion that such adjustments will further the intent of such provisions. | ||
3. | Eligibility . Phantom Points may be granted at any time to directors, employees (including officers) and service providers of an Employer, in the discretion of the Committee. | |
4. | Phantom Service Points; Payment . |
(a) | Phantom Service Point Pool . A pool of points shall exist consisting of Phantom Service Points. Phantom Service Points shall represent the right to receive a cash payment from the Employer within thirty (30) days following the date on which a distribution is made pursuant to the Parent LLC Agreement. The pool of Phantom Service Points shall initially be 10,000,000 but may be increased in the discretion of the Committee at any time. The total number of Phantom Service Points outstanding (after taking into account any adjustments made pursuant to Section 7) shall be referred to as the Total Phantom Service Point Pool. | ||
(b) | Phantom Service Percentage . The Phantom Plan Service Percentage for each Participant shall be the Final Phantom Service Percentage multiplied by the quotient obtained by dividing (x) the number of Phantom Service Points allocated to such Participant by (y) 10,000,000, or, if the Total Phantom Service Point Pool is greater than 10,000,000, the Total Phantom Service Point Pool. | ||
(c) | Phantom Service Point Payments . The cash amount payable to a Participant in respect of his or her Phantom Service Points at any time that a distribution is made pursuant to the Parent LLC Agreement in respect of Operating Units shall be determined by multiplying (x) such Participants Phantom Plan Service Percentage and (y) the amount of Exit Proceeds. For the avoidance of doubt, the foregoing is simply a calculation of amount of the cash payment payable to a Participant holding Phantom Service Points, and in no event shall such |
2
Participant, in its capacity as such, have any rights to receive a payment or distribution from Parent LLC. 1 |
5. | Phantom Performance Points; Payment . |
(a) | Phantom Performance Point Pool . A pool of points shall exist consisting of Phantom Performance Points. Phantom Performance Points shall represent the right to receive a cash payment within thirty (30) days following the date on which a distribution is made pursuant to the Parent LLC Agreement in respect of Value Units. The pool of Phantom Performance Points shall initially be 10,000,000, but may be increased in the discretion of the Committee at any time. The total number of Phantom Performance Points outstanding (after taking into account any adjustment made pursuant to Section 7) shall be referred to as the Total Phantom Performance Point Pool. | ||
(b) | Phantom Performance Percentage . The Phantom Plan Performance Percentage for each Participant shall initially be the Final Phantom Performance Percentage multiplied by the quotient obtained by dividing (x) the number of Phantom Performance Points allocated to such Participant by (y) 10,000,000, or, if the Total Phantom Performance Point Pool is greater than 10,000,000, the Total Phantom Performance Point Pool, and shall be further subject to reduction pursuant to Section 5(c) below. | ||
(c) | Performance Factor; Investment Multiple . As provided in the definition of Final Phantom Performance Percentage, each Participants Phantom Plan Performance Percentage reflects the Performance Factor, which operates to adjust Participants performance percentages based on the performance of the investment in the Parent LLC by the Investor Members. For purposes of this Plan: |
(1) | The Performance Factor equals a number (between zero and one) equal to the quotient obtained by dividing (i) the excess, if positive, of the Final Investment Multiple (as defined below) over the Minimum Investment Multiple by (ii) two (2); provided that if such quotient is greater than one, the Performance Factor will equal one. | ||
(2) | The Final Investment Multiple is computed, after giving effect to any payments to be made pursuant to this Plan, by dividing (x) the total fair market value of all net distributions received, or to be received upon the applicable distribution, by the Investor Members from the Company in respect of their aggregate investment in the Company divided by (y) the aggregate of such investment of the |
1 | Schedule A provides an illustration of how a calculation of a Phantom Service Point payment would be made under the Plan. It is not intended to be an indication of actual payments under the Plan. |
3
Investor Members in the Company (it being understood that all such amounts are themselves simultaneously being calculated by reference to amounts that may be payable pursuant to the Plan). |
(d) | Phantom Performance Point Payments . The cash amount payable to a Participant in respect of his or her Phantom Performance Points at any time that a distribution is made pursuant to the Parent LLC Agreement in respect of Value Units shall be determined by adding (x) the product of (i) such Participants Phantom Plan Performance Percentage and (ii) the amount of Exit Proceeds plus (y) an additional amount to provide a catch-up similar to that provided in respect of Value Units pursuant to Section 9.1(d) of the Parent LLC Agreement. For the avoidance of doubt, the foregoing is simply a calculation of the amount of the cash payment payable to a Participant holding Phantom Performance Points, and in no event shall such Participant, in its capacity as such, have any rights to receive a payment or distribution from Parent LLC. |
6. | Additional Awards; Adjustments . |
(a) | Additional Awards . An Employer may determine that a Participants performance warrants an award of additional Phantom Points, in which case the Employer may recommend to the Committee that an additional award be made. | ||
(b) | Prior Appreciation Adjustments . Each Participant will be assigned a Phantom Benchmark Amount, which shall be an amount determined by the Committee with respect to the Participant each time the Committee awards any Phantom Points to the Participant and relates to the valuation of Parent LLC at such time, provided that with respect to Phantom Points that are forfeited and reallocated pursuant to Section 7, the Committee, in its discretion, may instead assign the Phantom Benchmark Amount that was in effect for such forfeited Phantom Points immediately prior to such forfeiture or such other Phantom Benchmark Amount as it may determine in its discretion. Notwithstanding anything to the contrary set forth in the Plan, for purposes of the calculations under Section 4(c) and Section 5(d), the Committee shall make such adjustments to the amounts otherwise determined thereunder to account for the Phantom Benchmark Amount assigned in respect of a Participants Phantom Points. | ||
(c) | In the event of any material acquisition, disposition, merger, recapitalization, capital contribution or other similar event, the Committee may make such adjustment(s) to the terms of the Plan or any awards granted under the Plan as the Committee shall determine appropriate in its sole discretion. |
7. | Termination of Employment . If a Participant ceases to be employed by an Employer (other than in connection with a transfer to another Employer) prior to an Exit Event, such Participant shall forfeit all Phantom Points granted to the Participant. For avoidance of doubt, any forfeited Phantom Service Points and Phantom Performance Points shall be returned to the Phantom Service Point Pool and Phantom Performance Point Pool, respectively, and the Committee, in its discretion, may reallocate, by one or more separate grants, such forfeited Phantom Points to one or more employees who are eligible to participate in the Plan. |
4
8. | General Provisions . |
(a) | Nontransferability . Unless otherwise provided in an Award Agreement, Phantom Points shall not be transferable by a Participant under any circumstances, except by will or the laws of descent and distribution. | ||
(b) | No Right to Continued Employment, etc . Nothing in the Plan or in any Award Agreement entered into pursuant the Plan shall confer upon any Participant the right to continue in the employ of or to be entitled to any remuneration or benefits not set forth in the Plan or such Award Agreement, or to interfere with or limit in any way the right of an Employer to terminate such Participants employment. | ||
(c) | Taxes . The Company or any Affiliate is authorized to withhold from any payment relating to Phantom Points under the Plan amounts of withholding and other taxes due to enable the Company and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations. | ||
(d) | Excise Tax . To the extent that, (i) in the Committees determination, payment to a Participant in respect of his or her Phantom Points would constitute parachute payments (within the meaning of Section 280G of the Code), and if (ii) such payment would (together with any other payment to which the Participant is or may be entitled that would constitute a parachute payment), if reduced by all federal, state, and local taxes applicable thereto, including the excise tax imposed under Section 4999 of the Code, be less than the amount the Participant would receive, after all taxes, if the Participant received aggregate payments in respect of his or her Phantom Points (and such other payments) equal (as valued under Section 280G of the Code) to only three times the Participants base amount (within the meaning of Section 280G of the Code), less $1.00, then (iii) such payments hereunder shall be reduced to such extent to avoid the application of such excise tax; provided that the Company shall use its reasonable best efforts to obtain shareholder approval of the payments in a manner intended to satisfy requirements of the shareholder approval exception to Section 280G of the Code and the regulations promulgated thereunder, such that payments may be made to the Participant in respect of his or her Phantom Points without the application of the excise tax. | ||
(e) | Amendment and Termination . The Plan shall take effect on the date of its adoption by the manager of the Company (the Manager). The Manager may at any time and from time to time alter, amend, suspend, or terminate the Plan in whole or in part, including, but not limited to, amending the Plan and awards to alter the structure of the Plan if the Manager determines the Plan is not meeting its objectives. | ||
(f) | No Rights to Awards; No Stockholder or Member Rights . No Participant shall have any claim to be granted any Phantom Points under the Plan, and there is no obligation for uniformity of treatment of Participants. A Participant or a |
5
transferee of Phantom Points shall have no rights as a stockholder or member of the Company or any Affiliate. | |||
(g) | Unfunded Status of Awards . The Plan is intended to constitute an unfunded plan for incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Phantom Points shall give any such Participant any rights that are greater than those of a general creditor of the Company. | ||
(h) | Governing Law . The Plan and all determinations made and actions taken pursuant hereto shall be governed by the laws of the State of Delaware without giving effect to the conflict of laws principles thereof. | ||
(i) | Beneficiary . Upon the death of a Participant, all of his of her rights under the Plan shall inure to his or her designated beneficiary or, if no beneficiary has been designated, to his or her estate. | ||
(j) | No Guarantee or Assurances . There can be no guarantee that any distributions in respect of Operating Units or Value Units will occur under the Parent LLC Agreement or that any payment to any Participant will result under the Plan. | ||
(k) | Expiration of Plan . Unless otherwise determined by the Manager, the Plan shall expire on July 25, 2015 and all outstanding Phantom Points shall then expire and be forfeited with no consideration paid in respect of such forfeiture. |
6
7
8
9
Phantom Plan Service Percentage: |
(0.333 * 0.0391) * (500,000 / 10,000,000)
0.0130203 * 0.05 = 0.000651015 |
10
1. | Purpose; Operation . The purpose of the Amended and Restated Coffeyville Resources, LLC Phantom Unit Appreciation Plan (Plan II) (the Plan) is to provide an incentive to employees of the Company and its Affiliates who contribute to the Companys success to increase their efforts on behalf of the Company and to promote the success of the Companys business. Participants in the Plan have the opportunity to receive cash payments in respect of Phantom Points they hold in the event of certain distributions pursuant to the Parent II LLC Agreement to Members (as defined in the Parent II LLC Agreement) in Coffeyville Acquisition II LLC, an indirect equity owner of the Company. Whether payments will be made will depend on the amount of net proceeds realized in connection with the event that gives rise to such distributions. Defined terms are defined in Exhibit A hereto. | |
2. | Administration . The Plan shall be administered by the Committee. The Committee shall have the authority in its discretion, subject to and not inconsistent with the express provisions of the Plan, to administer the Plan and to exercise all the powers and authorities either specifically granted to it under the Plan or necessary or advisable in the administration of the Plan, including, without limitation: |
| the authority to grant Phantom Points; | ||
| to determine the persons to whom and the time or times at which Phantom Points shall be granted; | ||
| to determine the number and type of Phantom Points to be granted and the terms, conditions and restrictions relating thereto; | ||
| to determine whether, to what extent, and under what circumstances Phantom Points may be settled, cancelled, forfeited, exchanged, or surrendered; | ||
| to make adjustments in the terms and conditions applicable to Phantom Points; | ||
| to construe and interpret the Plan and Award Agreements; | ||
| to prescribe, amend and rescind rules and regulations relating to the Plan; | ||
| to determine the terms and provisions of the Award Agreements; | ||
| to determine the Baseline Primary Phantom Percentage, the Total Phantom Percentages and the Final Phantom Percentages; | ||
| to determine the amounts allocable for payment pursuant to this Plan; |
| to assign Phantom Benchmark Amounts; and | ||
| to make all other determinations deemed necessary or advisable for the administration of the Plan. |
All determinations made by the Committee in respect of the Plan shall be final and binding on all Participants and their beneficiaries. No manager or member of the Company or member of the Committee shall be liable for any action taken or determination made in good faith with respect to the Plan or any Phantom Points granted hereunder. The Committee, with the consent of Parent II LLC, shall make determinations with respect to percentages (including the Total Phantom Percentages and the Final Phantom Percentages) and cash amounts allocated, if any, to the Plan with reference to the applicable definitions set forth in Exhibit A ; provided that any and all determinations with respect to applicable percentages and cash amounts allocated to the Plan shall be made in the Committees discretion and may vary from such definitions. The Committee may make adjustments in the operation of provisions of the Plan if the Committee determines in its sole discretion that such adjustments will further the intent of such provisions. | ||
3. | Eligibility . Phantom Points may be granted at any time to directors, employees (including officers) and service providers of an Employer, in the discretion of the Committee. | |
4. | Phantom Service Points; Payment . |
(a) | Phantom Service Point Pool . A pool of points shall exist consisting of Phantom Service Points. Phantom Service Points shall represent the right to receive a cash payment from the Employer within thirty (30) days following the date on which a distribution is made pursuant to the Parent II LLC Agreement. The pool of Phantom Service Points shall initially be 10,000,000 but may be increased in the discretion of the Committee at any time. The total number of Phantom Service Points outstanding (after taking into account any adjustments made pursuant to Section 7) shall be referred to as the Total Phantom Service Point Pool. | ||
(b) | Phantom Service Percentage . The Phantom Plan Service Percentage for each Participant shall be the Final Phantom Service Percentage multiplied by the quotient obtained by dividing (x) the number of Phantom Service Points allocated to such Participant by (y) 10,000,000, or, if the Total Phantom Service Point Pool is greater than 10,000,000, the Total Phantom Service Point Pool. | ||
(c) | Phantom Service Point Payments . The cash amount payable to a Participant in respect of his or her Phantom Service Points at any time that a distribution is made pursuant to the Parent II LLC Agreement in respect of Operating Units shall be determined by multiplying (x) such Participants Phantom Plan Service Percentage and (y) the amount of Exit Proceeds. For the avoidance of doubt, the foregoing is simply a calculation of amount of the cash payment payable to a Participant holding Phantom Service Points, and in no event shall such |
2
Participant, in its capacity as such, have any rights to receive a payment or distribution from Parent II LLC. 1 |
5. | Phantom Performance Points; Payment . |
(a) | Phantom Performance Point Pool . A pool of points shall exist consisting of Phantom Performance Points. Phantom Performance Points shall represent the right to receive a cash payment within thirty (30) days following the date on which a distribution is made pursuant to the Parent II LLC Agreement in respect of Value Units. The pool of Phantom Performance Points shall initially be 10,000,000, but may be increased in the discretion of the Committee at any time. The total number of Phantom Performance Points outstanding (after taking into account any adjustment made pursuant to Section 7) shall be referred to as the Total Phantom Performance Point Pool. | ||
(b) | Phantom Performance Percentage . The Phantom Plan Performance Percentage for each Participant shall initially be the Final Phantom Performance Percentage multiplied by the quotient obtained by dividing (x) the number of Phantom Performance Points allocated to such Participant by (y) 10,000,000, or, if the Total Phantom Performance Point Pool is greater than 10,000,000, the Total Phantom Performance Point Pool, and shall be further subject to reduction pursuant to Section 5(c) below. | ||
(c) | Performance Factor; Investment Multiple . As provided in the definition of Final Phantom Performance Percentage, each Participants Phantom Plan Performance Percentage reflects the Performance Factor, which operates to adjust Participants performance percentages based on the performance of the investment in the Parent II LLC by the Investor Members. For purposes of this Plan: |
(1) | The Performance Factor equals a number (between zero and one) equal to the quotient obtained by dividing (i) the excess, if positive, of the Final Investment Multiple (as defined below) over the Minimum Investment Multiple by (ii) two (2); provided that if such quotient is greater than one, the Performance Factor will equal one. | ||
(2) | The Final Investment Multiple is computed, after giving effect to any payments to be made pursuant to this Plan, by dividing (x) the total fair market value of all net distributions received, or to be received upon the applicable distribution, by the Investor Members from the Company in respect of their aggregate investment in the Company divided by (y) the aggregate of such investment of the |
1 | Schedule A provides an illustration of how a calculation of a Phantom Service Point payment would be made under the Plan. It is not intended to be an indication of actual payments under the Plan. |
3
Investor Members in the Company (it being understood that all such amounts are themselves simultaneously being calculated by reference to amounts that may be payable pursuant to the Plan). |
(d) | Phantom Performance Point Payments . The cash amount payable to a Participant in respect of his or her Phantom Performance Points at any time that a distribution is made pursuant to the Parent II LLC Agreement in respect of Value Units shall be determined by adding (x) the product of (i) such Participants Phantom Plan Performance Percentage and (ii) the amount of Exit Proceeds plus (y) an additional amount to provide a catch-up similar to that provided in respect of Value Units pursuant to Section 9.1(d) of the Parent II LLC Agreement. For the avoidance of doubt, the foregoing is simply a calculation of the amount of the cash payment payable to a Participant holding Phantom Performance Points, and in no event shall such Participant, in its capacity as such, have any rights to receive a payment or distribution from Parent II LLC. |
6. | Additional Awards; Adjustments . |
(a) | Additional Awards . An Employer may determine that a Participants performance warrants an award of additional Phantom Points, in which case the Employer may recommend to the Committee that an additional award be made. | ||
(b) | Prior Appreciation Adjustments . Each Participant will be assigned a Phantom Benchmark Amount, which shall be an amount determined by the Committee with respect to the Participant each time the Committee awards any Phantom Points to the Participant and relates to the valuation of Parent II LLC at such time, provided that with respect to Phantom Points that are forfeited and reallocated pursuant to Section 7, the Committee, in its discretion, may instead assign the Phantom Benchmark Amount that was in effect for such forfeited Phantom Points immediately prior to such forfeiture or such other Phantom Benchmark Amount as it may determine in its discretion. Notwithstanding anything to the contrary set forth in the Plan, for purposes of the calculations under Section 4(c) and Section 5(d), the Committee shall make such adjustments to the amounts otherwise determined thereunder to account for the Phantom Benchmark Amount assigned in respect of a Participants Phantom Points. | ||
(c) | In the event of any material acquisition, disposition, merger, recapitalization, capital contribution or other similar event, the Committee may make such adjustment(s) to the terms of the Plan or any awards granted under the Plan as the Committee shall determine appropriate in its sole discretion. |
7. | Termination of Employment . If a Participant ceases to be employed by an Employer (other than in connection with a transfer to another Employer) prior to an Exit Event, such Participant shall forfeit all Phantom Points granted to the Participant. For avoidance of doubt, any forfeited Phantom Service Points and Phantom Performance Points shall be returned to the Phantom Service Point Pool and Phantom Performance Point Pool, respectively, and the Committee, in its discretion, may reallocate, by one or more separate grants, such forfeited Phantom Points to one or more employees who are eligible to participate in the Plan. |
4
8. | General Provisions . |
(a) | Nontransferability . Unless otherwise provided in an Award Agreement, Phantom Points shall not be transferable by a Participant under any circumstances, except by will or the laws of descent and distribution. | ||
(b) | No Right to Continued Employment, etc . Nothing in the Plan or in any Award Agreement entered into pursuant the Plan shall confer upon any Participant the right to continue in the employ of or to be entitled to any remuneration or benefits not set forth in the Plan or such Award Agreement, or to interfere with or limit in any way the right of an Employer to terminate such Participants employment. | ||
(c) | Taxes . The Company or any Affiliate is authorized to withhold from any payment relating to Phantom Points under the Plan amounts of withholding and other taxes due to enable the Company and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations. | ||
(d) | Excise Tax . To the extent that, (i) in the Committees determination, payment to a Participant in respect of his or her Phantom Points would constitute parachute payments (within the meaning of Section 280G of the Code), and if (ii) such payment would (together with any other payment to which the Participant is or may be entitled that would constitute a parachute payment), if reduced by all federal, state, and local taxes applicable thereto, including the excise tax imposed under Section 4999 of the Code, be less than the amount the Participant would receive, after all taxes, if the Participant received aggregate payments in respect of his or her Phantom Points (and such other payments) equal (as valued under Section 280G of the Code) to only three times the Participants base amount (within the meaning of Section 280G of the Code), less $1.00, then (iii) such payments hereunder shall be reduced to such extent to avoid the application of such excise tax; provided that the Company shall use its reasonable best efforts to obtain shareholder approval of the payments in a manner intended to satisfy requirements of the shareholder approval exception to Section 280G of the Code and the regulations promulgated thereunder, such that payments may be made to the Participant in respect of his or her Phantom Points without the application of the excise tax. | ||
(e) | Amendment and Termination . The Plan shall take effect on the date of its adoption by the manager of the Company (the Manager). The Manager may at any time and from time to time alter, amend, suspend, or terminate the Plan in whole or in part, including, but not limited to, amending the Plan and awards to alter the structure of the Plan if the Manager determines the Plan is not meeting its objectives. | ||
(f) | No Rights to Awards; No Stockholder or Member Rights . No Participant shall have any claim to be granted any Phantom Points under the Plan, and there is no obligation for uniformity of treatment of Participants. A Participant or a |
5
transferee of Phantom Points shall have no rights as a stockholder or member of the Company or any Affiliate. | |||
(g) | Unfunded Status of Awards . The Plan is intended to constitute an unfunded plan for incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Phantom Points shall give any such Participant any rights that are greater than those of a general creditor of the Company. | ||
(h) | Governing Law . The Plan and all determinations made and actions taken pursuant hereto shall be governed by the laws of the State of Delaware without giving effect to the conflict of laws principles thereof. | ||
(i) | Beneficiary . Upon the death of a Participant, all of his of her rights under the Plan shall inure to his or her designated beneficiary or, if no beneficiary has been designated, to his or her estate. | ||
(j) | No Guarantee or Assurances . There can be no guarantee that any distributions in respect of Operating Units or Value Units will occur under the Parent II LLC Agreement or that any payment to any Participant will result under the Plan. | ||
(k) | Expiration of Plan . Unless otherwise determined by the Manager, the Plan shall expire on July 25, 2015 and all outstanding Phantom Points shall then expire and be forfeited with no consideration paid in respect of such forfeiture. |
6
7
8
9
Phantom Plan Service Percentage: |
(0.333 * 0.0391) * (500,000 / 10,000,000)
0.0130203 * 0.05 = 0.000651015 |
10
Page | ||||
ARTICLE I
|
||||
|
||||
FORMATION OF THE COMPANY
|
||||
|
||||
Section 1.1 Formation
|
2 | |||
Section 1.2 Company Name
|
2 | |||
Section 1.3 The Certificate, etc.
|
2 | |||
Section 1.4 Term of Company
|
2 | |||
Section 1.5 Registered Agent and Office
|
3 | |||
Section 1.6 Principal Place of Business
|
3 | |||
Section 1.7 Qualification in Other Jurisdictions
|
3 | |||
Section 1.8 Fiscal Year; Taxable Year
|
3 | |||
|
||||
ARTICLE II
|
||||
|
||||
PURPOSE AND POWERS OF THE COMPANY
|
||||
|
||||
Section 2.1 Purpose
|
3 | |||
Section 2.2 Powers of the Company
|
3 | |||
Section 2.3 Certain Tax Matters
|
3 | |||
|
||||
ARTICLE III
|
||||
|
||||
MEMBERS AND INTERESTS GENERALLY
|
||||
|
||||
Section 3.1 Powers of Members
|
4 | |||
Section 3.2 Interests Generally
|
4 | |||
Section 3.3 Meetings of Members
|
5 | |||
Section 3.4 Business Transactions of a Member with the Company
|
6 | |||
Section 3.5 No Cessation of Membership upon Bankruptcy
|
6 | |||
Section 3.6 Additional Members
|
6 | |||
Section 3.7 Other Business for Members
|
7 | |||
|
||||
ARTICLE IV
|
||||
|
||||
MANAGEMENT
|
||||
|
||||
Section 4.1 Board
|
8 | |||
Section 4.2 Meetings of the Board
|
8 | |||
Section 4.3 Quorum and Acts of the Board
|
9 | |||
Section 4.4 Electronic Communications
|
9 | |||
Section 4.5 Committees of Directors
|
9 | |||
Section 4.6 Compensation of Directors
|
9 | |||
Section 4.7 Resignation
|
10 | |||
Section 4.8 Removal of Directors
|
10 |
i
Page | ||||
Section 4.9 Vacancies
|
10 | |||
Section 4.10 Directors as Agents
|
10 | |||
Section 4.11 Officers
|
10 | |||
Section 4.12 Strategic Planning Committee
|
11 | |||
|
||||
ARTICLE V
|
||||
|
||||
INVESTMENT REPRESENTATIONS, WARRANTIES AND COVENANTS
|
||||
|
||||
Section 5.1 Representations, Warranties and Covenants of Members
|
11 | |||
Section 5.2 Additional Representations and Warranties of Non-Investor Members
|
12 | |||
Section 5.3 Additional Representations and Warranties of Investor Members
|
13 | |||
Section 5.4 Additional Covenants of Management Members
|
13 | |||
|
||||
ARTICLE VI
|
||||
|
||||
CAPITAL ACCOUNTS; CAPITAL CONTRIBUTIONS
|
||||
|
||||
Section 6.1 Capital Accounts
|
14 | |||
Section 6.2 Adjustments
|
14 | |||
Section 6.3 Additional Capital Contributions
|
14 | |||
Section 6.4 Negative Capital Accounts
|
14 | |||
|
||||
ARTICLE VII
|
||||
|
||||
ADDITIONAL TERMS APPLICABLE TO OVERRIDE UNITS
|
||||
|
||||
Section 7.1 Certain Terms
|
14 | |||
Section 7.2 Effects of Termination of Employment on Override Units
|
15 | |||
|
||||
ARTICLE VIII
|
||||
|
||||
ALLOCATIONS
|
||||
|
||||
Section 8.1 Book Allocations of Net Income and Net Loss
|
18 | |||
Section 8.2 Special Book Allocations
|
18 | |||
Section 8.3 Tax Allocations
|
18 | |||
|
||||
ARTICLE IX
|
||||
|
||||
DISTRIBUTIONS
|
||||
|
||||
Section 9.1 Distributions Generally
|
19 | |||
Section 9.2 Distributions In Kind
|
20 | |||
Section 9.3 No Withdrawal of Capital
|
21 | |||
Section 9.4 Withholding
|
21 | |||
Section 9.5 Restricted Distributions
|
21 |
ii
Page | ||||
Section 9.6 Tax Distributions
|
21 | |||
|
||||
ARTICLE X
|
||||
|
||||
BOOKS AND RECORDS
|
||||
|
||||
Section 10.1 Books, Records and Financial Statements
|
22 | |||
Section 10.2 Filings of Returns and Other Writings; Tax Matters Partner
|
22 | |||
Section 10.3 Accounting Method
|
23 | |||
|
||||
ARTICLE XI
|
||||
|
||||
LIABILITY, EXCULPATION AND INDEMNIFICATION
|
||||
|
||||
Section 11.1 Liability
|
23 | |||
Section 11.2 Exculpation
|
23 | |||
Section 11.3 Fiduciary Duty
|
23 | |||
Section 11.4 Indemnification
|
24 | |||
Section 11.5 Expenses
|
24 | |||
Section 11.6 Severability
|
24 | |||
|
||||
ARTICLE XII
|
||||
|
||||
TRANSFERS OF INTERESTS
|
||||
|
||||
Section 12.1 Restrictions on Transfers of Interests by Members
|
24 | |||
Section 12.2 Overriding Provisions
|
25 | |||
Section 12.3 Estate Planning Transfers; Transfers upon Death of a Management Member
|
25 | |||
Section 12.4 Involuntary Transfers
|
26 | |||
Section 12.5 Assignments
|
26 | |||
Section 12.6 Substitute Members
|
26 | |||
Section 12.7 Release of Liability
|
27 | |||
|
||||
ARTICLE XIII
|
||||
|
||||
DISSOLUTION, LIQUIDATION AND TERMINATION
|
||||
|
||||
Section 13.1 Dissolving Events
|
27 | |||
Section 13.2 Dissolution and Winding-Up
|
27 | |||
Section 13.3 Distributions in Cash or in Kind
|
28 | |||
Section 13.4 Termination
|
28 | |||
Section 13.5 Claims of the Members
|
28 |
iii
Page | ||||
ARTICLE XIV
|
||||
|
||||
MISCELLANEOUS
|
||||
|
||||
Section 14.1 Notices
|
28 | |||
Section 14.2 Securities Act Matters
|
29 | |||
Section 14.3 Headings
|
30 | |||
Section 14.4 Entire Agreement
|
30 | |||
Section 14.5 Counterparts
|
30 | |||
Section 14.6 Governing Law; Attorneys Fees
|
30 | |||
Section 14.7 Waivers
|
30 | |||
Section 14.8 Invalidity of Provision
|
30 | |||
Section 14.9 Further Actions
|
30 | |||
Section 14.10 Amendments
|
31 | |||
Section 14.11 No Third Party Beneficiaries
|
31 | |||
Section 14.12 Injunctive Relief
|
31 | |||
Section 14.13 Power of Attorney
|
32 | |||
|
||||
ARTICLE XV
|
||||
|
||||
DEFINED TERMS
|
||||
|
||||
Section 15.1 Definitions
|
32 |
iv
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Percentage of such | ||||
Inactive Management | ||||
Members Operating Units | ||||
If the termination occurs | to be Forfeited | |||
Before the second anniversary of the grant of
such Inactive Management Members Operating Units
|
100 | % | ||
|
||||
On or after the second anniversary, but before
the third anniversary, of the grant of such
Inactive Management Members Operating Units
|
75 | % | ||
|
||||
On or after the third anniversary, but before the
fourth anniversary, of the grant of such Inactive
Management Members Operating Units
|
50 | % | ||
|
||||
On or after the fourth anniversary, but before
the fifth anniversary, of the grant of such
Inactive Management Members Operating Units
|
25 | % | ||
|
||||
On or after the fifth anniversary of the grant of
such Inactive Management Members Operating Units
|
0 | % |
16
Percentage of such | ||||
Inactive Management | ||||
Members Value Units | ||||
Not Subject to Forfeiture | ||||
Pursuant to Section | ||||
If death or Disability occurs | 7.2(a)(ii) | |||
Before the second anniversary of the grant of
such Inactive Management Members Value Units
|
0 | % | ||
|
||||
On or after the second anniversary, but before
the third anniversary, of the grant of such
Inactive Management Members Value Units
|
25 | % | ||
|
||||
On or after the third anniversary, but before
the fourth anniversary, of the grant of such
Inactive Management Members Value Units
|
50 | % | ||
|
||||
On or after the fourth anniversary, but before
the fifth anniversary, of the grant of such
Inactive Management Members Value Units
|
75 | % | ||
|
||||
On or after the fifth anniversary of the grant
of such Inactive Management Members Value Units
|
100 | % |
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
(a) | the sale, transfer or other disposition by the Investor Members to one or more Persons that are not, immediately prior to such sale, Affiliates of the Company or any Investor Member of all of the Interests of the Company beneficially owned by the Investor Members as of the date of such transaction; or | ||
(b) | the sale, transfer or other disposition of all of the assets of the Company and its Subsidiaries, taken as a whole, to one or more Persons that are not, immediately prior to such sale, transfer or other disposition, Affiliates of the Company or any Investor Member. |
(a) | for purposes of determining the value of any property owned by, contributed to or distributed by the Company, ( i ) in the case of publicly-traded securities, the average of their last sales prices on the applicable trading exchange or quotation system on each trading day during the five trading-day period ending on such date and ( ii ) in the case of any other property, the fair market value of such property, as determined in good faith by the Board; or | ||
(b) | for purposes of determining the value of any Members Interest in connection with Section 12.4 (Involuntary Transfers), ( i ) the fair market value of such Interest as reflected in the most recent appraisal report prepared, at the request of the Board, by an independent valuation consultant or appraiser of recognized national standing, reasonably satisfactory to the Board, or ( ii ) in the event no such appraisal exists or the date of such report is more than one year prior to the date of determination, the fair market value of such Interest as determined in good faith by the Board. |
35
36
(a) | without the Management Members prior written consent, a reduction by the Company or any such Subsidiary of his or her current salary, other than any such reduction which is part of a general salary reduction or other concessionary arrangement affecting all employees or affecting the group of employees of which the Management Member is a member (after receipt by the Company of written notice from such Management Member and a 20-day cure period); or |
37
(b) | the taking of any action by the Company or any such Subsidiary that would substantially diminish the aggregate value of the benefits provided him or her under the Companys or such Subsidiarys accident, disability, life insurance and any other employee benefit plans in which he or she was participating on the date of his or her execution of this Agreement, other than any such reduction which is ( i ) required by law, ( ii ) implemented in connection with a general concessionary arrangement affecting all employees or affecting the group of employees of which the Management Member is a member, ( iii ) generally applicable to all beneficiaries of such plans (after receipt by the Company of written notice and a 20-day cure period) or ( iv ) in accordance with the terms of any such plan. |
38
39
Date of
Initial
Capital
Name
Admission
Mailing Address
Balance
Contribution
Common Units
June 24, 2005
c/o Kelso & Company, L.P.
320 Park Avenue, 24th Floor
New York, New York 10022
Attention: James J. Connors II
Fax: (212) 223-2379
N/A
$
100,846,088.29
8,912,707.00
June 24, 2005
c/o Kelso & Company, L.P.
320 Park Avenue, 24th Floor
New York, New York 10022
Attention: James J. Connors II
Fax: (212) 223-2379
N/A
$
24,971,411.71
2,206,956.00
N/A
$
125,817,500.00
11,119,663.00
Override Units
Date of
Capital
Date of
Operating
Value
Benchmark
Name
Admission
Mailing Address
Contribution
Common Units
Issuance
Units
Units
Amount
July 25, 2005
806 Skimmer Court
$
650,000
57,446
Jul. 25, 2005
315,818
631,637
$
11.3149
Sugar Land, TX 77478
Dec. 29, 2006
72,492
144,966
$
34.72
July 25, 2005
5005 Hidalgo, Apt. 810
$
400,000
35,352
Jul. 25, 2005
140,185
280,371
$
11.3149
Houston, TX 77056
July 25, 2005
8030 NW Breckenridge Drive
$
250,000
22,095
Jul. 25, 2005
71,965
143,931
$
11.3149
Kansas City, MO 64152
July 25, 2005
225 Fluor Daniel #13103
$
250,000
22,095
Jul. 25, 2005
71,965
143,931
$
11.3149
Sugar Land, TX 77479
July 25, 2005
4704 Cherry Hills Court
$
250,000
22,095
Jul. 25, 2005
71,965
143,931
$
11.3149
Lawrence, KS 66047
July 25, 2005
5610 Lone Cedar Drive
$
100,000
8,838
Jul. 25, 2005
71,965
143,931
$
11.3149
Kingwood, TX 77345
July 25, 2005
250 South Post Oak Lane
$
100,000
8,838
Jul. 25, 2005
71,965
143,931
$
11.3149
Houston, TX 77056
July 25, 2005
2003 Sea King Street
$
100,000
8,838
Jul. 25, 2005
51,901
103,801
$
11.3149
Houston, TX 77008
July 25, 2005
5364 McCulloch Circle
$
50,000
4,419
Jul. 25, 2005
51,901
103,801
$
11.3149
Houston, TX 77056
September 12, 2005
8824 Rosewood Drive
$
30,000
2,651
Sep 12, 2005
N/A
N/A
N/A
Prairie Village, KS 66207
July 25, 2005
1543 Haddon Street
$
25,000
2,209
Jul. 25, 2005
N/A
N/A
N/A
Houston, TX 77006
July 25, 2005
1523 Green Leaf Oaks Drive
$
70,000
6,187
Jul. 25, 2005
N/A
N/A
N/A
Sugar Land, TX 77479
$
2,275,000
201,063
992,122
1,984,931
Override Units
Capital
Common
Date of
Value
Benchmark
Name
Contribution
Units
Issuance/Forfeiture
Operating Units
Units
Amount
806 Skimmer Court
$
325,000
28,723
Jul. 25, 2005
N/A
N/A
N/A
Sugar Land, TX 77478
November 9, 2009
3,796
15,185
$
33.8149
806 Skimmer Court
N/A
N/A
Jul. 25, 2005
78,954.5
157,909.25
$
11.3149
Sugar Land, TX 77478
Dec. 29, 2006
18,123
36,241.5
$
34.72
806 Skimmer Court
N/A
N/A
Jul. 25, 2005
78,954.5
157,909.25
$
11.3149
Sugar Land, TX 77478
Dec. 29, 2006
18,123
36,241.5
$
34.72
5005 Hidalgo, Apt. 810
$
200,000
17,676
Jul. 25, 2005
70,092.5
140,185.5
$
11.3149
Houston, TX 77056
November 9, 2009
1,370
5,482
$
33.8149
8030 NW Breckenridge Drive
$
125,000
11,047.5
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Kansas City, MO 64152
May 22, 2009
(8,996
)
(35,983
)
225 Fluor Daniel #13103
$
125,000
11,047.5
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Sugar Land, TX 77479
November 9, 2009
704
2,814
$
33.8149
4704 Cherry Hills Court
$
125,000
11,047.5
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Lawrence, KS 66047
November 9, 2009
704
2,814
$
33.8149
5610 Lone Cedar Drive
$
50,000
4,419
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Kingwood, TX 77345
November 9, 2009
704
2,814
$
33.8149
250 South Post Oak Lane
$
50,000
4,419
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Houston, TX 77056
November 9, 2009
704
2,814
$
33.8149
2003 Sea King Street
$
50,000
4,419
Jul. 25, 2005
25,950.5
51,900.5
$
11.3149
Houston, TX 77008
November 9, 2009
507
2,030
$
33.8149
5364 McCulloch Circle
$
25,000
2,209.5
Jul. 25, 2005
25,950.5
51,900.5
$
11.3149
Houston, TX 77056
November 9, 2009
507
2,030
$
33.8149
8824 Rosewood Drive
$
15,000
1,325.5
Sep 12, 2005
N/A
N/A
N/A
Prairie Village, KS 66207
1543 Haddon Street
$
12,500
1,104.5
Jul. 25, 2005
N/A
N/A
N/A
Houston, TX 77006
1523 Green Leaf Oaks Drive
$
35,000
3,093.5
Jul. 25, 2005
N/A
N/A
N/A
Sugar Land, TX 77479
$
1,137,500
100,531.75
496,061
992,115.5
Date of
Capital
Name
Admission
Mailing Address
Contribution
Common Units
June 24, 2005
Magnetite Asset Investors III
L.L.C.
c/o BlackRock Financial
Management, Inc.
40 East 52
nd
Street
New York, New York 10022
Attention: Jeff Gary
$
2,000,000
176,758.00
September 20, 2005
One Crestmont Drive
Little Rock, AR 72227
$
125,000
11,047.50
Name: | ||||
Page | ||||
ARTICLE I
|
||||
|
||||
FORMATION OF THE COMPANY
|
||||
|
||||
Section 1.1 Formation
|
2 | |||
Section 1.2 Company Name
|
2 | |||
Section 1.3 The Certificate, etc.
|
2 | |||
Section 1.4 Term of Company
|
2 | |||
Section 1.5 Registered Agent and Office
|
2 | |||
Section 1.6 Principal Place of Business
|
3 | |||
Section 1.7 Qualification in Other Jurisdictions
|
3 | |||
Section 1.8 Fiscal Year; Taxable Year
|
3 | |||
|
||||
ARTICLE II
|
||||
|
||||
PURPOSE AND POWERS OF THE COMPANY
|
||||
|
||||
Section 2.1 Purpose
|
3 | |||
Section 2.2 Powers of the Company
|
3 | |||
Section 2.3 Certain Tax Matters
|
3 | |||
|
||||
ARTICLE III
|
||||
|
||||
MEMBERS AND INTERESTS GENERALLY
|
||||
|
||||
Section 3.1 Powers of Members
|
3 | |||
Section 3.2 Interests Generally
|
4 | |||
Section 3.3 Meetings of Members
|
5 | |||
Section 3.4 Business Transactions of a Member with the Company
|
6 | |||
Section 3.5 No Cessation of Membership upon Bankruptcy
|
6 | |||
Section 3.6 Additional Members
|
6 | |||
Section 3.7 Other Business for Members
|
7 | |||
|
||||
ARTICLE IV
|
||||
|
||||
MANAGEMENT
|
||||
|
||||
Section 4.1 Board
|
8 | |||
Section 4.2 Meetings of the Board
|
8 | |||
Section 4.3 Quorum and Acts of the Board
|
8 | |||
Section 4.4 Electronic Communications
|
9 | |||
Section 4.5 Committees of Directors
|
9 | |||
Section 4.6 Compensation of Directors
|
9 | |||
Section 4.7 Resignation
|
9 | |||
Section 4.8 Removal of Directors
|
10 |
Page | ||||
Section 4.9 Vacancies
|
10 | |||
Section 4.10 Directors as Agents
|
10 | |||
Section 4.11 Officers
|
10 | |||
Section 4.12 Strategic Planning Committee
|
10 | |||
|
||||
ARTICLE V
|
||||
|
||||
INVESTMENT REPRESENTATIONS, WARRANTIES AND COVENANTS
|
||||
|
||||
Section 5.1 Representations, Warranties and Covenants of Members
|
11 | |||
Section 5.2 Additional Representations and Warranties of Non-Investor Members
|
12 | |||
Section 5.3 Additional Representations and Warranties of Investor Members
|
13 | |||
Section 5.4 Additional Covenants of Management Members
|
13 | |||
|
||||
ARTICLE VI
|
||||
|
||||
CAPITAL ACCOUNTS; CAPITAL CONTRIBUTIONS
|
||||
|
||||
Section 6.1 Capital Accounts
|
13 | |||
Section 6.2 Adjustments
|
14 | |||
Section 6.3 Additional Capital Contributions
|
14 | |||
Section 6.4 Negative Capital Accounts
|
14 | |||
|
||||
ARTICLE VII
|
||||
|
||||
ADDITIONAL TERMS APPLICABLE TO OVERRIDE UNITS
|
||||
|
||||
Section 7.1 Certain Terms
|
14 | |||
Section 7.2 Effects of Termination of Employment on Override Units
|
15 | |||
|
||||
ARTICLE VIII
|
||||
|
||||
ALLOCATIONS
|
||||
|
||||
Section 8.1 Book Allocations of Net Income and Net Loss
|
17 | |||
Section 8.2 Special Book Allocations
|
18 | |||
Section 8.3 Tax Allocations
|
18 | |||
|
||||
ARTICLE IX
|
||||
|
||||
DISTRIBUTIONS
|
||||
|
||||
Section 9.1 Distributions Generally
|
19 | |||
Section 9.2 Distributions In Kind
|
20 | |||
Section 9.3 No Withdrawal of Capital
|
20 | |||
Section 9.4 Withholding
|
20 |
Page | ||||
Section 9.5 Restricted Distributions
|
21 | |||
Section 9.6 Tax Distributions
|
21 | |||
|
||||
ARTICLE X
|
||||
|
||||
BOOKS AND RECORDS
|
||||
|
||||
Section 10.1 Books, Records and Financial Statements
|
22 | |||
Section 10.2 Filings of Returns and Other Writings; Tax Matters Partner
|
22 | |||
Section 10.3 Accounting Method
|
23 | |||
|
||||
ARTICLE XI
|
||||
|
||||
LIABILITY, EXCULPATION AND INDEMNIFICATION
|
||||
|
||||
Section 11.1 Liability
|
23 | |||
Section 11.2 Exculpation
|
23 | |||
Section 11.3 Fiduciary Duty
|
23 | |||
Section 11.4 Indemnification
|
23 | |||
Section 11.5 Expenses
|
24 | |||
Section 11.6 Severability
|
24 | |||
|
||||
ARTICLE XII
|
||||
|
||||
TRANSFERS OF INTERESTS
|
||||
|
||||
Section 12.1 Restrictions on Transfers of Interests by Members
|
24 | |||
Section 12.2 Overriding Provisions
|
24 | |||
Section 12.3 Estate Planning Transfers; Transfers upon Death of a Management Member
|
25 | |||
Section 12.4 Involuntary Transfers
|
25 | |||
Section 12.5 Assignments
|
26 | |||
Section 12.6 Substitute Members
|
26 | |||
Section 12.7 Release of Liability
|
26 | |||
|
||||
ARTICLE XIII
|
||||
|
||||
DISSOLUTION, LIQUIDATION AND TERMINATION
|
||||
|
||||
Section 13.1 Dissolving Events
|
27 | |||
Section 13.2 Dissolution and Winding-Up
|
27 | |||
Section 13.3 Distributions in Cash or in Kind
|
28 | |||
Section 13.4 Termination
|
28 | |||
Section 13.5 Claims of the Members
|
28 |
Page | ||||
ARTICLE XIV
|
||||
|
||||
MISCELLANEOUS
|
||||
|
||||
Section 14.1 Notices
|
28 | |||
Section 14.2 Securities Act Matters
|
29 | |||
Section 14.3 Headings
|
29 | |||
Section 14.4 Entire Agreement
|
29 | |||
Section 14.5 Counterparts
|
30 | |||
Section 14.6 Governing Law; Attorneys Fees
|
30 | |||
Section 14.7 Waivers
|
30 | |||
Section 14.8 Invalidity of Provision
|
30 | |||
Section 14.9 Further Actions
|
30 | |||
Section 14.10 Amendments
|
31 | |||
Section 14.11 No Third Party Beneficiaries
|
31 | |||
Section 14.12 Injunctive Relief
|
31 | |||
Section 14.13 Power of Attorney
|
31 | |||
|
||||
ARTICLE XV
|
||||
|
||||
DEFINED TERMS
|
||||
|
||||
Section 15.1 Definitions
|
32 |
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Percentage of such | ||||
Inactive Management | ||||
Members Operating Units | ||||
If the termination occurs | to be Forfeited | |||
Before the second anniversary of the Issuance
Date of such Inactive Management Members
Operating Units
|
100 | % | ||
|
||||
On or after the second anniversary, but before
the third anniversary, of the Issuance Date of
such Inactive Management Members Operating Units
|
75 | % | ||
|
||||
On or after the third anniversary, but before the
fourth anniversary, of the Issuance Date of such
Inactive Management Members Operating Units
|
50 | % | ||
|
||||
On or after the fourth anniversary, but before
the fifth anniversary, of the Issuance Date of
such Inactive Management Members Operating Units
|
25 | % | ||
|
||||
On or after the fifth anniversary of the Issuance
Date of such Inactive Management Members
Operating Units
|
0 | % |
16
Percentage of such | ||||
Inactive Management | ||||
Members Value Units | ||||
Not Subject to Forfeiture | ||||
Pursuant to Section | ||||
If death or Disability occurs | 7.2(a)(ii) | |||
Before the second anniversary of the
Issuance Date of such Inactive
Management Members Value Units
|
0 | % | ||
|
||||
On or after the second anniversary, but
before the third anniversary, of the
Issuance Date of such Inactive
Management Members Value Units
|
25 | % | ||
|
||||
On or after the third anniversary, but
before the fourth anniversary, of the
Issuance Date of such Inactive
Management Members Value Units
|
50 | % | ||
|
||||
On or after the fourth anniversary, but
before the fifth anniversary, of the
Issuance Date of such Inactive
Management Members Value Units
|
75 | % | ||
|
||||
On or after the fifth anniversary of the
Issuance Date of such Inactive
Management Members Value Units
|
100 | % |
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
(a) | the sale, transfer or other disposition by the Investor Members to one or more Persons that are not, immediately prior to such sale, Affiliates of the Company or any Investor Member of all of the Interests of the Company beneficially owned by the Investor Members as of the date of such transaction; or | ||
(b) | the sale, transfer or other disposition of all of the assets of the Company and its Subsidiaries, taken as a whole, to one or more Persons that are not, immediately prior to such sale, transfer or other disposition, Affiliates of the Company or any Investor Member. |
(a) | for purposes of determining the value of any property owned by, contributed to or distributed by the Company, ( i ) in the case of publicly-traded securities, the average of their last sales prices on the applicable trading exchange or quotation system on each trading day during the five trading-day period ending on such date and ( ii ) in the case of any other property, the fair market value of such property, as determined in good faith by the Board; or | ||
(b) | for purposes of determining the value of any Members Interest in connection with Section 12.4 (Involuntary Transfers), ( i ) the fair market value of such Interest as reflected in the most recent appraisal report prepared, at the request of the Board, by an independent valuation consultant or appraiser of recognized national standing, reasonably satisfactory to the Board, or ( ii ) in the event no such appraisal exists or the date of such report is more than one year prior to the date of determination, the fair market value of such Interest as determined in good faith by the Board. |
35
36
37
(a) | without the Management Members prior written consent, a reduction by the Company or any such Subsidiary of his or her current salary, other than any such reduction which is part of a general salary reduction or other concessionary arrangement affecting all employees or affecting the group of employees of which the Management Member is a member (after receipt by the Company of written notice from such Management Member and a 20-day cure period); or | ||
(b) | the taking of any action by the Company or any such Subsidiary that would substantially diminish the aggregate value of the benefits provided him or her under the Companys or such Subsidiarys accident, disability, life insurance and any other employee benefit plans in which he or she was participating on the date of his or her execution of this Agreement, other than any such reduction which is ( i ) required by law, ( ii ) implemented in connection with a general concessionary arrangement affecting all employees or affecting the group of employees of which the Management Member is a member, ( iii ) generally applicable to all beneficiaries of such plans (after receipt by the Company of written notice and a 20-day cure period) or ( iv ) in accordance with the terms of any such plan. |
38
39
Name
Date of Admission
Mailing Address
Capital Contribution
Common Units
Fund, L.P.
October 16, 2007
c/o GS Capital Partners V, L.P.
85 Broad Street
New York, New York 10004
Attention: Kenneth Pontarelli
Facsimile No.: (212) 357-5505
$
67,303,592.42
5,948,244
Offshore Fund,
L.P.
October 16, 2007
c/o GS Capital Partners V, L.P.
85 Broad Street
New York, New York 10004
Attention: Kenneth Pontarelli
Facsimile No.: (212) 357-5505
$
34,766,224.76
3,072,615
Institutional,
L.P.
October 16, 2007
c/o GS Capital Partners V, L.P.
85 Broad Street
New York, New York 10004
Attention: Kenneth Pontarelli
Facsimile No.: (212) 357-5505
$
23,079,323.46
2,039,735
GmbH & Co. KG
October 16, 2007
c/o GS Capital Partners V, L.P.
85 Broad Street
New York, New York 10004
Attention: Kenneth Pontarelli
Facsimile No.: (212) 357-5505
$
2,668,359.36
235,827
$
127,817,500.00
11,296,421
Override Units
Date of
Capital
Common
Operating
Benchmark
Name
Admission
Mailing Address
Contribution
Units
Issuance Date
Units
Value Units
Amount
October 16, 2007
806 Skimmer Court
$
325,000
28,723
Jul. 25, 2005
N/A
N/A
N/A
Sugar Land, TX 77478
November 9, 2009
3,796
15,185
$
33.8149
October 16, 2007
806 Skimmer Court
N/A
N/A
Jul. 25, 2005
78,954.5
157,909.25
$
11.3149
Sugar Land, TX 77478
Dec. 29, 2006
18,123
36,241.5
$
34.72
October 16, 2007
806 Skimmer Court
N/A
N/A
Jul. 25, 2005
78,954.5
157,909.25
$
11.3149
Sugar Land, TX 77478
Dec. 29, 2006
18,123
36,241.5
$
34.72
October 16, 2007
5005 Hidalgo, Apt. 810
$
200,000
17,676
Jul. 25, 2005
70,092.5
140,185.5
$
11.3149
Houston, TX 77056
November 9, 2009
1,370
5,482
$
33.8149
October 16, 2007
8030 NW Breckenridge Drive
$
125,000
11,047.5
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Kansas City, MO 64152
May 22, 2009
(8,996
)
(35,983
)
October 16, 2007
225 Fluor Daniel #13103
$
125,000
11,047.5
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Sugar Land 77479
November 9, 2009
704
2,814
$
33.8149
October 16, 2007
4704 Cherry Hills Court
$
125,000
11,047.5
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Lawrence, KS 66047
November 9, 2009
704
2,814
$
33.8149
October 16, 2007
5610 Lone Cedar Drive
$
50,000
4,419
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Kingwood, TX 77345
November 9, 2009
704
2,814
$
33.8149
October 16, 2007
250 South Post Oak Lane
$
50,000
4,419
Jul. 25, 2005
35,982.5
71,965.5
$
11.3149
Houston, TX 77056
November 9, 2009
704
2,814
$
33.8149
October 16, 2007
2003 Sea King Street
$
50,000
4,419
Jul. 25, 2005
25,950.5
51,900.5
$
11.3149
Houston, TX 77008
November 9, 2009
507
2,030
$
33.8149
Override Units
Date of
Capital
Common
Operating
Benchmark
Name
Admission
Mailing Address
Contribution
Units
Issuance Date
Units
Value Units
Amount
October 16, 2007
5364 McCulloch Circle
$
25,000
2,209.5
Jul. 25, 2005
25,950.5
51,900.5
$
11.3149
Houston, TX 77056
November 9, 2009
507
2,030
$
33.8149
October 16, 2007
8824 Rosewood Drive
$
15,000
1,325.5
Sep 12, 2005
N/A
N/A
N/A
Prairie Village, KS 66207
October 16, 2007
1543 Haddon Street
$
12,500
1,104.5
Jul. 25, 2005
N/A
N/A
N/A
Houston, TX 77006
October 16, 2007
1523 Green Leaf Oaks Drive
$
35,000
3,093.5
Jul. 25, 2005
N/A
N/A
N/A
Sugar Land, TX 77479
$
1,137,500
100,531.75
496,061
992,115.5
Date of
Capital
Name
Admission
Mailing Address
Contribution
Common Units
October 16, 2007
One Crestmont Drive
Little Rock, AR 72227
$
125,000
11,047.5
Name: | ||||
Predecessor (1) | Successor (1) | |||||||||||||||||||||||
174 Days | 233 Days | |||||||||||||||||||||||
Ended | Ended | Year Ended | Year Ended | Year Ended | Year Ended | |||||||||||||||||||
June 23, | December 31, | December 31, | December 31, | December 31, | December 31, | |||||||||||||||||||
2005 | 2005 | 2006 | 2007 | 2008 | 2009 | |||||||||||||||||||
(in millions) | ||||||||||||||||||||||||
Fixed charges:
|
||||||||||||||||||||||||
a) Interest expensed and capitalized
|
7.3 | 24.1 | 52.2 | 70.4 | 40.7 | 44.3 | ||||||||||||||||||
b) Amortized capitalized expenses related
to indebtedness (2)
|
8.9 | 1.7 | 26.7 | 4.1 | 12.0 | 4.0 | ||||||||||||||||||
c) Estimate of interest within rental
expense
|
0.6 | 0.6 | 1.3 | 1.3 | 1.4 | 1.7 | ||||||||||||||||||
|
||||||||||||||||||||||||
Total fixed charges
|
16.8 | 26.4 | 80.2 | 75.8 | 54.1 | 50.0 | ||||||||||||||||||
Adjusted earnings:
|
||||||||||||||||||||||||
a) Pre-tax income (loss) (3)
|
88.5 | (182.2 | ) | 311.4 | (156.3 | ) | 227.8 | 98.6 | ||||||||||||||||
b) Fixed charges
|
16.8 | 26.4 | 80.2 | 75.8 | 54.1 | 50.0 | ||||||||||||||||||
c) Amortization of capitalized interest
|
| | 0.1 | 0.5 | 1.2 | 1.3 | ||||||||||||||||||
d) Interest capitalized
|
(0.3 | ) | (0.8 | ) | (11.6 | ) | (12.0 | ) | (2.4 | ) | (2.0 | ) | ||||||||||||
|
||||||||||||||||||||||||
Adjusted earnings
|
105.0 | (156.6 | ) | 380.1 | (92.0 | ) | 280.7 | 147.9 | ||||||||||||||||
|
||||||||||||||||||||||||
Ratio of Earnings to Fixed Charges (4)
|
6.3 | x | | 4.7 | x | | 5.2 | x | 3.0 | x |
(1) |
On June 24, 2005, pursuant to a stock purchase agreement dated May 15, 2005, Coffeyville Acquisition LLC (CALLC), which was formed in Delaware on May 13, 2005 by
certain funds affiliated with Goldman, Sachs & Co. and Kelso & Company, L.P., acquired all of the subsidiaries of Coffeyville Group Holdings, LLC (Predecessor).
In the five year period presented above, the business was operated by the Predecessor for the 174-days ended June 23, 2005. Post-June 24, 2005 operations are
referred to as Successor. CALLC operated the business from June 24, 2005 until CVR Energys initial public offering in October 2007.
CVR Energy was formed in September 2006 as a subsidiary of CALLC in order to consummate an initial public offering of the businesses previously operated by CALLC. Prior to CVR Energys initial public offering in October 2007, (1) CALLC transferred all of its businesses to CVR Energy in exchange for all of CVR Energys common stock, (2) CALLC was effectively split into two entities, with the Kelso Funds controlling CALLC and the Goldman Sachs Funds controlling Coffeyville Acquisition II LLC (CALLC II) and CVR Energys senior management receiving an equivalent position in each of the two entities, (3) the nitrogen fertilizer business was transferred to the Partnership in exchange for all of the partnership interests in the Partnership and (4) all of the interests of the managing general partner of the Partnership were sold to an entity owned by the controlling stockholders and senior management at fair market value on the date of the transfer. CVR Energy consummated its initial public offering on October 26, 2007. |
|
(2) | Includes the write-off of $8.1 million of deferred financing costs in connection with the refinancing of our senior secured credit facility on June 23, 2005; $23.4 million in connection with the refinancing of our senior secured credit facility on December 28, 2006 and $1.3 million in connection with the repayment and termination of three credit facilities on October 26, 2007; $10.0 million of deferred financing costs in connection with the second amendment to our credit facility on December 22, 2008; $2.1 million of deferred financing with the reduction, effective June 1, 2009 and eventual termination of our funded letter of credit facility on October 15, 2009. | |
(3) | Pre-tax income (loss) for the calculation of ratio of income to fixed charges is defined as pre-tax income (loss) before adjustments for noncontrolling interest. | |
(4) | Earnings were insufficient to cover fixed charges by $183.0 million and $167.8 million for the 233 days ended December 31, 2005 and the year ended December 31, 2007, respectively. |
Entity | Jurisdiction | |
Coffeyville Refining & Marketing Holdings, Inc.
|
Delaware | |
Coffeyville Refining & Marketing, Inc.
|
Delaware | |
Coffeyville Nitrogen Fertilizers, Inc.
|
Delaware | |
Coffeyville Crude Transportation, Inc.
|
Delaware | |
Coffeyville Terminal, Inc.
|
Delaware | |
Coffeyville Pipeline, Inc.
|
Delaware | |
CL JV Holdings, LLC
|
Delaware | |
Coffeyville Resources, LLC
|
Delaware | |
Coffeyville Resources Refining & Marketing, LLC
|
Delaware | |
Coffeyville Resources Crude Transportation, LLC
|
Delaware | |
Coffeyville Resources Terminal, LLC
|
Delaware | |
Coffeyville Resources Pipeline, LLC
|
Delaware | |
CVR Special GP, LLC
|
Delaware | |
CVR Partners, LP
|
Delaware | |
Coffeyville Resources Nitrogen Fertilizers, LLC
|
Delaware |
Date: March 12, 2010 | By: | /s/ John J. Lipinski | ||
John J. Lipinski | ||||
Chief Executive Officer |
122
Date: March 12, 2010 | By: | /s/ Edward Morgan | ||
Edward Morgan | ||||
Chief Financial Officer |
123
Date: March 12, 2010 | By: | /s/ John J. Lipinski | ||
John J. Lipinski | ||||
Chief Executive Officer | ||||
By: | /s/ Edward Morgan | |||
Edward Morgan | ||||
Chief Financial Officer | ||||
124