Unrestricted Subsidiaries

9 Months Ended

Sep. 30, 2023

Unrestricted Subsidiaries

Unrestricted Subsidiaries

13. Unrestricted Subsidiaries

As defined in the indentures governing the Company’s outstanding senior notes, an unrestricted subsidiary means MRHL, MRL and any other subsidiary of the Company, other than Calumet Finance Corp., that is designated by the Company’s general partner’s board of directors as an unrestricted subsidiary, but only to the extent that such subsidiary:

● has no indebtedness other than non-recourse debt owing to any person other than the Company or any of its restricted subsidiaries, except to the extent permitted by the indentures of the senior notes;

● is not party to any agreement, contract, arrangement or understanding with the Company or any restricted subsidiary of the Company unless the terms of any such agreement, contract, arrangement or other understanding are no less favorable to the Company or such restricted subsidiary than those that might be obtained at the time from persons who are not affiliates of the Company, except to the extent permitted by the indentures of the senior notes;

● is a person with respect to which neither the Company nor any of its restricted subsidiaries has any direct or indirect obligation (a) to subscribe for additional equity interests or (b) to maintain or preserve such person’s financial condition or to cause such person to achieve any specified levels of operating results, except to the extent permitted by the indentures of the senior notes; and

● has not guaranteed or otherwise directly or indirectly provided credit support for any indebtedness of the Company or any of its restricted subsidiaries.

As of September 30, 2023 and December 31, 2022, respectively, MRHL and MRL were the only unrestricted subsidiaries of the Company. In accordance with the indentures governing the Company’s outstanding senior notes, the following tables set forth certain financial information of (i) the Company and its restricted subsidiaries, on a combined basis, (ii) the Company’s unrestricted subsidiaries, on a combined basis, and (iii) the Company and its subsidiaries, on a consolidated basis, in each case, as of September 30, 2023 and December 31, 2022, respectively.

	Parent
	Company and
	Restricted		Unrestricted				Consolidated
September 30, 2023	Subsidiaries		Subsidiaries		Eliminations		Total
Cash and cash equivalents	$	6.1	$	7.6	$	—	$	13.7
Accounts receivable	$	307.4	$	40.4	$	—	$	347.8
Inventory	$	345.0	$	102.7	$	—	$	447.7
Prepaid expenses and other current assets	$	20.7	$	28.3	$	—	$	49.0
Property, plant and equipment, net	$	737.9	$	789.0	$	—	$	1,526.9
Other noncurrent assets, net	$	397.0	$	17.5	$	—	$	414.5
Accounts payable	$	307.4	$	283.9	$	(249.2)	$	342.1
Accrued interest payable	$	40.2	$	1.0		—		41.2
Obligations under inventory financing agreements	$	166.1	$	71.8	$	—	$	237.9
Other current liabilities	$	73.0	$	12.2	$	—	$	85.2
Current portion of long-term debt	$	187.8	$	16.8	$	—	$	204.6
Other long-term liabilities	$	53.7	$	3.8	$	—	$	57.5
Long-term debt	$	1,167.0	$	541.2	$	(100.0)	$	1,608.2
Redeemable noncontrolling interest	$	—	$	250.0	$	—	$	250.0
Partners’ capital (deficit)	$	(233.6)	$	(195.2)	$	(18.8)	$	(447.6)

	Parent
	Company and
	Restricted		Unrestricted				Consolidated
December 31, 2022	Subsidiaries		Subsidiaries		Eliminations		Total
Cash and cash equivalents	$	9.4	$	25.8	$	—	$	35.2
Accounts receivable	$	259.8	$	8.2	$	—	$	268.0
Inventory	$	370.1	$	127.9	$	—	$	498.0
Prepaid expenses and other current assets	$	13.2	$	6.0	$	—	$	19.2
Property, plant and equipment, net	$	760.7	$	721.3	$	—	$	1,482.0
Other noncurrent assets, net	$	428.8	$	10.6	$	—	$	439.4
Accounts payable	$	307.6	$	265.6	$	(130.8)	$	442.4
Obligations under inventory financing agreements	$	158.2	$	63.6	$	—	$	221.8
Other current liabilities	$	100.8	$	13.7	$	—	$	114.5
Current portion of long-term debt	$	8.2	$	11.8	$	—	$	20.0
Other long-term liabilities	$	59.0	$	1.2	$	—	$	60.2
Long-term debt	$	1,183.3	$	356.4	$	—	$	1,539.7
Redeemable noncontrolling interest	$	—	$	250.0	$	—	$	250.0
Partners’ capital (deficit)	$	(456.4)	$	(62.5)	$	(18.8)	$	(537.7)

For the three months ended September 30, 2023, the Company’s unrestricted subsidiaries had revenue of $184.6 million, operating costs of $164.1 million, which was exclusive of depreciation expense of $11.7 million, selling, general and administrative expense of $5.8 million, interest expense of $22.6 million, unrealized loss on derivative instruments of $4.5 million, other income of $0.6 million and net loss attributable to noncontrolling interest of $3.1 million. For the three months ended September 30, 2022, the Company’s unrestricted subsidiaries had tolling revenue of $20.3 million, operating costs of $4.6 million, which was exclusive of depreciation expense of $3.8 million, interest expense of $7.1 million, and loss on debt extinguishment of $38.3 million.

For the nine months ended September 30, 2023, the Company’s unrestricted subsidiaries had revenue of $431.4 million, operating costs of $452.3 million, which was exclusive of depreciation expense of $30.7 million, selling, general and administrative expense of $15.1 million, other operating expense of $4.0 million, interest expense of $59.5 million, unrealized loss on derivative instruments of $3.2 million, other income of $0.7 million and net loss attributable to noncontrolling interest of $18.5 million. For the nine months ended September 30, 2022, the Company’s unrestricted subsidiaries had tolling revenue of $63.5 million, operating costs of $18.5 million, which was exclusive of depreciation expense of $11.3 million, interest expense of $29.4 million, and loss on debt extinguishment of $38.3 million.