Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Holly Energy Partners, L.P. ("HEP") announced today that Holly Logistic
Services, L.L.C. ("HLS") and Richard L. Voliva III agreed to a mutual separation
effective as of the date hereof (the "Separation Date"). Mr. Voliva served as
President of HLS and Executive Vice President and Chief Financial Officer of HF
Sinclair Corporation ("HF Sinclair") prior to his separation. HLS, a
wholly-owned subsidiary of the HF Sinclair, is the general partner of HEP
Logistics Holdings, L.L.C., which is the general partner of HEP.
In connection with Mr. Voliva's separation, HF Sinclair, HollyFrontier
Corporation ("HFC"), HLS, HollyFrontier Payroll Services, Inc., and HEP, on
behalf of themselves and their respective parents, subsidiaries and affiliates,
and Mr. Voliva entered into a Mutual Separation Agreement and Release dated
September 15, 2022 (the "Agreement"). The Agreement sets forth the terms of his
separation compensation approved by the Board of Directors (the "Board") of HLS
and includes the following compensation to be paid to Mr. Voliva: (i) as a
result of his provision of services to HEP and HLS during substantially all of
the 2022 performance period ending on September 30, 2022, a 2022 annual
incentive cash bonus payment of $600,000, which is 150% of his target bonus of
$400,000 and at or near the expected actual payout for the 2022 performance
period, and (ii) pro rata vesting of his outstanding HEP phantom units,
resulting in the vesting of 14,956 phantom units granted to him in October 2020
as of his Separation Date.
As a result of Mr. Voliva's prior position with HF Sinclair, the terms of the
Agreement include, and Mr. Voliva will also receive from HF Sinclair, a
separation payment equal to one year of salary of $715,000 to be paid in twelve
monthly installments, a one-time cash payment of $100,000 payable within 30 days
following the date of execution of the Agreement, a 2022 annual incentive cash
bonus from HF Sinclair in the amount of $965,250, and pro rata vesting of his HF
Sinclair equity awards, resulting in the vesting of 23,953 HF Sinclair
restricted stock units and 48,971 HF Sinclair performance share units as of the
Separation Date. For additional information regarding Mr. Voliva's separation
compensation from HF Sinclair, see HF Sinclair's Current Report on Form 8-K
filed September 15, 2022.
The foregoing severance and bonus payments are subject to Mr. Voliva not later
revoking the Agreement, which contains non-solicitation, non-compete,
non-disparagement and confidentiality covenants from Mr. Voliva.
As a result of Mr. Voliva's separation, the Board appointed Michael C. Jennings
as President of HLS, effective as of the date hereof. Mr. Jennings, 56, has
served as Chief Executive Officer of HLS since January 2020 and as the
Chairperson of the Board of HLS since November 2017 and will continue to serve
in those capacities. He previously served as Chief Executive Officer of HLS from
January 2014 to November 2016 and as President of HLS from October 2015 to
February 2016. Mr. Jennings has served as Chief Executive Officer of HF Sinclair
since March 2022 and as Chief Executive Officer of HFC, the predecessor entity
of HF Sinclair, since January 2020. He also served as President of HFC from
January 2020 to November 2021, as Executive Vice President of HFC from November
2019 to January 2020, as Executive Chairman of HFC from January 2016 to January
2017 and as the Chief Executive Officer and President of HFC from the merger of
Holly Corporation and Frontier Oil Corporation in July 2011 to January 2016.
Mr. Jennings previously served as the President and Chief Executive Officer of
Frontier Oil Corporation from 2009 until the merger in July 2011 and as the
Executive Vice President and Chief Financial Officer of Frontier Oil Corporation
from 2005 to 2009. He currently serves as a director of HF Sinclair.
Mr. Jennings served as Chairperson of the Board of HFC from January 2017 to
February 2019 and January 2013 to January 2016. He served as a director of FTS
International, Inc. from January 2019 to November 2020, as a director and
Chairman of the Board of Montage Resources and its predecessor entities from May
2016 to November 2019, and as a director of ION Geophysical Corporation from
December 2010 until February 2019. Mr. Jennings served as a director of Frontier
Oil Corporation from 2008 until the merger in July 2011 and as Chairman of the
Board of Frontier Oil Corporation from 2010 until the merger in July 2011.
There are no arrangements or understandings between Mr. Jennings and any other
person pursuant to which he was named President. Mr. Jennings does not have any
family relationship with any director or executive officer of HLS or any person
nominated or chosen by HLS to become a director or executive officer. There are
no transactions in which Mr. Jennings has an interest requiring disclosure under
Item 404(a) of Regulation S-K.
Item 7.01 Regulation FD Disclosure
On September 15, 2022, HEP issued a joint press release with HF Sinclair
announcing the management changes. A copy of the Corporation's press release is
attached hereto at Exhibit 99.1 and incorporated in this Item 7.01 in its
entirety.
The information contained in, or incorporated into, this Item 7.01 is being
furnished and shall not be deemed "filed" for the purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, or otherwise subject to the
liabilities of that section, nor shall it be deemed incorporated by reference
into any registration statement or other filing under the Securities Act of
1933, as amended, except as shall be expressly set forth by specific reference
to such filing.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
99.1 Press Release dated September 15, 2022.*
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
* Furnished herewith.
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