Subsequent Events

12 Months Ended

Dec. 31, 2024

Subsequent Events

Subsequent Events

21. Subsequent Events

Equity Distribution Agreement

On January 14, 2025, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) with BMO Capital Markets Corp. (the “Agent”) pursuant to which the Company may sell, from time to time, up to an aggregate offering price of $65.0 million of its common stock, par value $0.01 per share (the “Common Stock”), in an “at-the-market” equity offering program (the “ATM Offering”) through the Agent.

9.75% Senior Notes due 2028

On January 16, 2025, the Issuers issued $100.0 million aggregate principal amount of a new series of the Issuers’ 9.75% Senior Notes due 2028 (the “2028 Notes”) in a private placement conducted pursuant to Rule 144A and Regulation S under the Securities Act. The 2028 Notes were issued at 98% of par for net proceeds of approximately $96.2 million, after deducting the initial purchasers’ discount and estimated offering expenses. The Company intends to use the net proceeds from the offering of the Notes to redeem a portion of the Issuers’ outstanding 2026 Notes on or before April 15, 2025.

U.S. Department of Energy Facility

On January 10, 2025, MRL and the U.S. Department of Energy (the “DOE”), as guarantor and loan servicer, executed a Loan Guarantee Agreement (“LGA”) for a $1.44 billion guaranteed loan facility to fund the construction and expansion of the renewable fuels facility owned by MRL. The loan guarantee is structured in two tranches, with the first tranche of approximately $782 million disbursed on February 18, 2025 (the “Funding Date”) to fund eligible expenses previously incurred by MRL. MRL has the ability to draw additional tranches of up to approximately $658.0 million through a delayed draw construction facility.

In connection with the funding of the first tranche under the DOE Facility, MRL terminated (i) the MRL Asset Financing Arrangements, (ii) the MRL Term Loan Credit Agreement, (iii) the MRL Revolving Credit Agreement and (iv) the MRL Supply and Offtake Agreement.

On the Funding Date, the Company used a portion of the proceeds from the first tranche of the DOE Facility to:

● repurchase all of the equipment associated with the MRL Asset Financing Arrangements for approximately $392.3 million (including exit fees of $23.0 million);

● repay in full the outstanding loans of approximately $83.8 million under the MRL Term Loan Credit Agreement (including a make-whole premium of approximately $9.4 million and an early termination premium of approximately $0.7 million);

● repay in full the outstanding loans of approximately $26.7 million under the MRL Revolving Credit Agreement; and

● repay in full the outstanding obligations of approximately $32.5 million under the MRL Supply and Offtake Agreement.

Refer to Note 8 — “Long-Term Debt” for additional information regarding the MRL Asset Financing Arrangements, the MRL Term Loan Credit Agreement and MRL Revolving Credit Agreement Refer to Note 7 — “Inventory Financing Agreements” for further information regarding the MRL Supply and Offtake Agreement.

In addition, the Company received $40.0 million of cash from Stonebriar on the Funding Date in satisfaction of the remaining purchase price for the Montana Refinery Asset Financing Arrangement. Refer to Note 8 — “Long-Term Debt” for further information regarding the Montana Refinery Asset Financing Arrangement.

Sale of Assets Related to Industrial Portion of Royal Purple® Business

On February 28, 2025, the Company announced that it entered into a definitive agreement with a wholly owned subsidiary of Lubrication Engineers, Inc., a portfolio company of Aurora Capital Partners, to sell the industrial portion of its Royal Purple® business, for $110.0 million, subject to certain customary adjustments. The Company will retain the consumer portion of the Royal Purple® business. The Company expects to use the sale proceeds to primarily reduce its indebtedness. The transaction is expected to close in the first half of 2025, subject to customary regulatory approvals and other closing conditions.