What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-08-08 compared with 2024-05-08 · 356 added, 231 removed, 732 unchanged (45% of the section changed)

4 unchanged sentences

(in thousands, except share data)

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Current assets

2 unchanged sentences

Total cash, cash equivalents, and restricted cash 180,001 279,446

Trade accounts receivable, net of allowances of $ 0.2 million and $ 0.2 million at March 31, 2024 and December 31, 2023, respectively

Trade accounts receivable, net of allowances of $ 0.3 million and $ 0.2 million at June 30, 2024 and December 31, 2023, respectively

486,300 367,249

35 unchanged sentences

Common stock, $ 0.01 par value;

500,000,000 shares authorized at March 31, 2024 and December 31, 2023, 59,070,467 shares and 59,755,844 shares issued at March 31, 2024 and December 31, 2023, respectively

500,000,000 shares authorized at June 30, 2024 and December 31, 2023, 56,908,751 shares and 59,755,844 shares issued at June 30, 2024 and December 31, 2023, respectively

Additional paid-in capital 875,868 860,797

8 unchanged sentences

(in thousands, except per share amounts)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2024 2023 2024 2023

Revenues $ 2,017,468 $ 1,783,927 $ 3,998,303 $ 3,469,136

13 unchanged sentences

Debt extinguishment and commitment costs ( 1,418 ) 38 ( 1,418 ) ( 17,682 )

Other loss, net ( 2,576 ) ( 35 )

Equity earnings from Laramie Energy, LLC 4,563 10,706

Other income (loss), net ( 124 ) 379 ( 2,700 ) 344

Equity earnings (losses) from Laramie Energy, LLC ( 1,360 ) — 3,203 10,706

Total other expense, net ( 23,336 ) ( 14,492 ) ( 39,233 ) ( 37,791 )

Income (loss) before income taxes ( 6,382 ) 238,103

Income tax benefit (expense) 2,631 ( 213 )

Net income (loss) $ ( 3,751 ) $ 237,890

Income (loss) per share

Income before income taxes 25,305 31,941 18,923 270,044

Income tax expense ( 6,667 ) ( 1,928 ) ( 4,036 ) ( 2,141 )

Net income $ 18,638 $ 30,013 $ 14,887 $ 267,903

Income per share

Basic $ 0.33 $ 0.50 $ 0.26 $ 4.45

6 unchanged sentences

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

Three Months Ended

Net income (loss) $ ( 3,751 ) $ 237,890

Three Months Ended Six Months Ended

June 30, June 30,

2024 2023 2024 2023

Net income $ 18,638 $ 30,013 $ 14,887 $ 267,903

Other comprehensive income (loss):

1 unchanged sentence

Total other comprehensive loss, net of tax ( 55 ) ( 11 ) ( 109 ) ( 22 )

Comprehensive income (loss) $ ( 3,805 ) $ 237,879

Comprehensive income $ 18,583 $ 30,002 $ 14,778 $ 267,881

See accompanying notes to the condensed consolidated financial statements.

3 unchanged sentences

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

Net Income (Loss) $ ( 3,751 ) $ 237,890

Adjustments to reconcile net income (loss) to cash provided by operating activities:

Net Income $ 14,887 $ 267,903

Adjustments to reconcile net income to cash provided by operating activities:

Depreciation and amortization 64,800 52,576

4 unchanged sentences

Stock-based compensation 19,502 6,082

Unrealized (gain) loss on derivative contracts 43,849 ( 13,670 )

Unrealized loss on derivative contracts 64,948 7,621

Equity earnings from Laramie Energy, LLC ( 3,203 ) ( 10,706 )

10 unchanged sentences

Cash flows from investing activities:

Acquisition of business — ( 608,223 )

Capital expenditures ( 59,532 ) ( 30,729 )

1 unchanged sentence

Return of capital from Laramie Energy, LLC 1,485 10,706

Return of capital from refining and logistics investments — 2,175

Net cash used in investing activities ( 57,987 ) ( 626,021 )

2 unchanged sentences

Repayments of borrowings ( 1,464,163 ) ( 702,499 )

Net borrowings on deferred payment arrangements and receivable advances 2,443 22,407

Net borrowings (repayments) on deferred payment arrangements and receivable advances ( 165,459 ) ( 31,405 )

Payment of deferred loan costs ( 7,234 ) ( 9,127 )

1 unchanged sentence

Exercise of stock options — 6,374

Proceeds from inventory financing agreements 203,074 —

Payments for termination of inventory financing agreements ( 382,143 ) —

Payments for debt extinguishment and commitment costs ( 977 ) ( 8,742 )

Other financing activities, net 1,198 617

Net cash provided by (used in) financing activities ( 62,213 ) 13,812

Net increase (decrease) in cash, cash equivalents, and restricted cash ( 50,807 ) 170,392

Net decrease in cash, cash equivalents, and restricted cash ( 99,445 ) ( 299,969 )

Cash, cash equivalents, and restricted cash at beginning of period 279,446 494,926

8 unchanged sentences

ROU assets obtained in exchange for new operating lease liabilities 42,058 16,684

ROU assets terminated in exchange for release from finance lease liabilities — —

ROU assets terminated in exchange for release from operating lease liabilities 4,177 —

See accompanying notes to the condensed consolidated financial statements.

13 unchanged sentences

Balance, March 31, 2023 61,030 $ 610 $ 842,062 $ 37,203 $ 8,118 $ 887,993

Issuance of common stock for employee stock purchase plan 27 — 726 — — 726

Stock-based compensation 115 1 3,655 — — 3,656

Purchase of common stock for retirement ( 128 ) ( 1 ) ( 464 ) ( 2,601 ) — ( 3,066 )

Other comprehensive loss — — — — ( 11 ) ( 11 )

Net income — — — 30,013 — 30,013

Balance, June 30, 2023 61,044 $ 610 $ 845,979 $ 64,615 $ 8,107 $ 919,311

Additional Other

7 unchanged sentences

Balance, March 31, 2024 59,070 $ 590 $ 872,954 $ 429,675 $ 8,120 $ 1,311,339

Issuance of common stock for employee stock purchase plan 56 — 1,409 — — 1,409

Stock-based compensation 37 — 2,881 — — 2,881

Purchase of common stock for retirement ( 2,254 ) ( 22 ) ( 1,376 ) ( 67,034 ) — ( 68,432 )

Other comprehensive loss — — — — ( 55 ) ( 55 )

Net income — — — 18,638 — 18,638

Balance, June 30, 2024 56,909 $ 568 $ 875,868 $ 381,279 $ 8,065 $ 1,265,780

See accompanying notes to the condensed consolidated financial statements.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

Note 1 — Overview

10 unchanged sentences

West Coast and Hawaii, and in areas ranging from the state of Washington to the Dakotas and Wyoming.

As of March 31, 2024, we owned a 46.0 % equity investment in Laramie Energy, LLC (“Laramie Energy”).

As of June 30, 2024, we owned a 46.0 % equity investment in Laramie Energy, LLC (“Laramie Energy”).

Laramie Energy is focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.

As of March 31, 2024, through the Billings Acquisition (as defined in Note 5—Acquisitions), we own a 65 % and a 40 % equity investment in Yellowstone Energy Limited Partnership, (“YELP”) and Yellowstone Pipeline Company (“YPLC”), respectively.

As of June 30, 2024, through the Billings Acquisition (as defined in Note 5—Acquisitions), we own a 65 % and a 40 % equity investment in Yellowstone Energy Limited Partnership, (“YELP”) and Yellowstone Pipeline Company (“YPLC”), respectively.

Our Corporate and Other reportable segment primarily includes general and administrative costs.

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Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

through discussions between the customer and the Company.

We establish provisions for losses on trade receivables based on the estimated credit loss we expect to incur over the life of the receivable.

We did not have a material change in our allowances on trade receivables during the three months ended March 31, 2024 or 2023.

We did not have a material change in our allowances on trade receivables during the three and six months ended June 30, 2024, or 2023.

Cost Classifications

4 unchanged sentences

The following table summarizes depreciation and finance lease amortization expense excluded from each line item in our condensed consolidated statements of operations (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Cost of revenues $ 7,161 $ 5,022 $ 13,904 $ 10,021

12 unchanged sentences

The change in our equity investment in YELP is as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Beginning balance $ 58,676 $ — $ 59,824 $ —

Acquisition of investment

— 58,019 — 58,019

Equity earnings from YELP

2,290 — 6,755 —

Depreciation of basis difference

( 348 ) — ( 696 ) —

Dividends received — — ( 5,265 ) —

Ending balance $ 60,618 $ 58,019 $ 60,618 $ 58,019

Yellowstone Pipeline Company

PAR PACIFIC HOLDINGS, INC.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

Yellowstone Pipeline Company

On June 1, 2023, we completed the Billings Acquisition and acquired a 40 % ownership interest in YPLC.

4 unchanged sentences

The change in our equity investment in YPLC is as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Beginning balance $ 29,639 $ — $ 27,662 $ —

Acquisition of investment

— 28,581 — 28,581

Equity earnings from YPLC

1,763 425 3,702 425

Accretion of basis difference 38 — 76 —

Basis difference adjustment — — — —

Dividends received ( 3,840 ) ( 2,600 ) ( 3,840 ) ( 2,600 )

Capital contribution in YPLC

Ending balance $ 27,600 $ 26,406 $ 27,600 $ 26,406

Note 4— Investment in Laramie Energy

Laramie Energy

As of March 31, 2024, we owned a 46.0 % ownership interest in Laramie Energy, an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.

The balance of our investment in Laramie Energy was $ 18.8 million and $ 14.3 million as of March 31, 2024 and December 31, 2023, respectively.

As of June 30, 2024, we owned a 46.0 % ownership interest in Laramie Energy, an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.

The balance of our investment in Laramie Energy was $ 16.0 million and $ 14.3 million as of June 30, 2024 and December 31, 2023, respectively.

On February 21, 2023, Laramie Energy entered into a new term loan agreement which provides a $ 205 million first lien term loan facility with $ 160.0 million funded at closing and an optional $ 45 million delayed draw commitment, subject to certain terms and conditions.

1 unchanged sentence

Laramie Energy’s term loan matures on February 21, 2027.

As of March 31, 2024 and December 31, 2023, the term loan had an outstanding balance of $ 160.0 million.

As of June 30, 2024 and December 31, 2023, the term loan had an outstanding balance of $ 160.0 million.

On March 1, 2023, pursuant to its new term loan agreement, Laramie Energy made a one-time cash distribution to its owners, including us, based on ownership percentage.

Our share of this distribution was $ 10.7 million, which was reflected as Return of capital from Laramie Energy, LLC on our condensed consolidated statements of cash flows.

We recorded the cash received as Equity earnings from Laramie Energy, LLC on our condensed consolidated statements of operations because the carrying value of our investment in Laramie Energy was zero at the time of such distribution.

We recorded the cash received as Equity earnings (losses) from Laramie Energy, LLC on our condensed consolidated statements of operations because the carrying value of our investment in Laramie Energy was zero at the time of such distribution.

On April 29, 2024, Laramie Energy made a one-time cash distribution to its owners, including us, based on ownership percentage.

Our share of this distribution was $ 1.5 million.

Effective February 21, 2023, and concurrent with the new term loan agreement noted above, we resumed the application of equity method accounting with respect to our investment in Laramie Energy.

At March 31, 2024, our equity in the underlying net assets of Laramie Energy exceeded the carrying value of our investment by approximately $ 69.5 million.

At June 30, 2024, our equity in the underlying net assets of Laramie Energy exceeded the carrying value of our investment by approximately $ 68.0 million.

This difference arose primarily due to other-than-temporary impairments of our equity investment in Laramie Energy.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

The change in our equity investment in Laramie Energy is as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Beginning balance $ 18,842 $ — $ 14,279 $ —

1 unchanged sentence

Accretion of basis difference 1,615 — 3,229 —

Dividends received ( 1,485 ) — ( 1,485 ) —

Ending balance

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

$ 15,997 $ — $ 15,997 $ —

Note 5— Acquisitions

21 unchanged sentences

As of March 31, 2024, we finalized the Billings Acquisition purchase price allocation.

We incurred $ 5.3 million of acquisition costs related to the Billings Acquisition for the three months ended March 31, 2023.

We incurred $ 5.1 million and $ 10.4 million of acquisition costs related to the Billings Acquisition for the three and six months ended June 30, 2023, respectively.

These costs are included in Acquisition and integration costs on our condensed consolidated statements of operations.

We assumed certain environmental liabilities associated with the Billings Acquisition, including costs related to hazardous waste corrective measures, ground and surface water sampling and monitoring.

We expect to incur these costs over a 20 to 30 year period.

The results of operations of the Montana refinery, newly acquired logistics assets in the Rockies region, and YELP and YPLC equity investments were included in our results beginning on June 1, 2023.

The following unaudited pro forma financial

PAR PACIFIC HOLDINGS, INC.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

information presents our consolidated revenues and net income as if the Billings Acquisition had been completed on January 1, 2022 (in thousands):

Three Months Ended March 31,

For the Interim Periods Ended June 30, 2024 and 2023

We expect to incur these costs over a 20 to 30 year period.

The results of operations of the Montana refinery, newly acquired logistics assets in the Rockies region, and YELP and YPLC equity investments were included in our results beginning on June 1, 2023.

The following unaudited pro forma financial information presents our consolidated revenues and net income as if the Billings Acquisition had been completed on January 1, 2022 (in thousands):

Six Months Ended

June 30, 2023

Revenues $ 4,410,002

2 unchanged sentences

The unaudited pro forma financial information is not necessarily indicative of the results of operations that would have been achieved had the Billings Acquisition been effective as of the dates presented, nor is it indicative of future operating results of the combined company.

Pro forma adjustments include (i) incremental depreciation resulting from the estimated fair value of property, plant, and equipment acquired, (ii) transaction costs which were shifted from the three months ended March 31, 2023 to the three months ended March 31, 2022 and (iii) elimination of historical transactions between Par and the Montana assets.

Pro forma adjustments include (i) incremental depreciation resulting from the estimated fair value of property, plant, and equipment acquired, (ii) transaction costs which were shifted from the six months ended June 30, 2023 to the six months ended June 30, 2022 and (iii) elimination of historical transactions between Par and the Montana assets.

Note 6— Revenue Recognition

As of March 31, 2024 and December 31, 2023, receivables from contracts with customers were $ 373.1 million and $ 311.1 million, respectively.

As of June 30, 2024 and December 31, 2023, receivables from contracts with customers were $ 398.2 million and $ 311.1 million, respectively.

Our refining segment recognizes deferred revenues when cash payments are received in advance of delivery of products to the customer.

Deferred revenue was $ 21.6 million and $ 15.2 million as of March 31, 2024 and December 31, 2023, respectively.

Deferred revenue was $ 24.0 million and $ 15.2 million as of June 30, 2024 and December 31, 2023, respectively.

We have elected to apply a practical expedient not to disclose the value of unsatisfied performance obligations for (i) contracts with an original expected duration of less than one year and (ii) contracts where the variable consideration has been allocated entirely to our unsatisfied performance obligation.

The following table provides information about disaggregated revenue by major product line and includes a reconciliation of the disaggregated revenues to total segment revenues (in thousands):

Three Months Ended March 31, 2024 Refining Logistics Retail

Three Months Ended June 30, 2024 Refining Logistics Retail

Product or service:

6 unchanged sentences

Total segment revenues (3) $ 1,957,273 $ 72,475 $ 152,842

Three Months Ended March 31, 2023 Refining Logistics Retail

Three Months Ended June 30, 2023 Refining Logistics Retail

Product or service:

6 unchanged sentences

Total segment revenues (3) $ 1,708,541 $ 64,709 $ 148,396

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

Six Months Ended June 30, 2024 Refining Logistics Retail

Product or service:

Gasoline $ 1,377,867 $ — $ 215,203

Distillates (1) 1,634,235 — 23,908

Other refined products (2) 800,937 — —

Merchandise — — 52,142

Transportation and terminalling services — 144,317 —

Other revenue 70,850 — 1,723

Total segment revenues (3) $ 3,883,889 $ 144,317 $ 292,976

Six Months Ended June 30, 2023 Refining Logistics Retail

Product or service:

Gasoline $ 1,053,922 $ — $ 209,453

Distillates (1) 1,479,101 — 23,967

Other refined products (2) 790,228 — —

Merchandise — — 48,720

Transportation and terminalling services — 117,097 —

Other revenue 702 — 1,828

Total segment revenues (3) $ 3,323,953 $ 117,097 $ 283,968

_______________________________________________________

2 unchanged sentences

(3) Refer to Note 19—Segment Information for the reconciliation of segment revenues to total consolidated revenues.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

Note 7— Inventories

Inventories at March 31, 2024, and December 31, 2023, consisted of the following (in thousands):

Titled Inventory Supply and Offtake Agreement (1) Total

March 31, 2024

Inventories at June 30, 2024 and December 31, 2023, consisted of the following (in thousands):

Titled Inventory Inventory Intermediation Agreement (1)

Supply and Offtake Agreement (1) Total

June 30, 2024

Crude oil and feedstocks $ 188,057 $ 228,407 $ — $ 416,464

9 unchanged sentences

(1) Please read Note 9—Inventory Financing Agreements for further information.

(2) Includes $ 128.7 million and $ 237.6 million of RINs and environmental credits, reported at the lower of cost or net realizable value, as of March 31, 2024 and December 31, 2023, respectively.

Our renewable volume obligation and other gross environmental credit obligations of $ 134.5 million and $ 286.9 million, are included in Other accrued liabilities on our condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, respectively.

As of March 31, 2024 and December 31, 2023, there was no reserve for the lower of cost or net realizable value of inventory.

As of March 31, 2024 and December 31, 2023, the current replacement cost exceeded the LIFO inventory carrying value by approximately $ 42.8 million and $ 36.1 million, respectively.

(2) Includes $ 160.1 million and $ 237.6 million of RINs and environmental credits, reported at the lower of cost or net realizable value, as of June 30, 2024 and December 31, 2023, respectively.

Our renewable volume obligation and other gross environmental credit obligations of $ 164.0 million and $ 286.9 million are included in Other accrued liabilities on our condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023, respectively.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

As of June 30, 2024 and December 31, 2023, there was no reserve for the lower of cost or net realizable value of inventory.

As of June 30, 2024 and December 31, 2023, the current replacement cost exceeded the LIFO inventory carrying value by approximately $ 54.7 million and $ 36.1 million, respectively.

Note 8— Prepaid and Other Current Assets

Prepaid and other current assets at March 31, 2024 and December 31, 2023 consisted of the following (in thousands):

March 31, 2024 December 31, 2023

Prepaid and other current assets at June 30, 2024 and December 31, 2023 consisted of the following (in thousands):

June 30, 2024 December 31, 2023

Advances to suppliers for crude purchases $ — $ 65,531

10 unchanged sentences

The following table summarizes our outstanding obligations under our inventory financing agreements (in thousands):

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Inventory Intermediation Agreement $ 251,058 $ —

Supply and Offtake Agreement

$ 662,688 $ 594,362

LC Facility due 2024

Obligations under inventory financing agreements $ 251,058 $ 594,362

Inventory Intermediation Agreement

On May 31, 2024, Par Hawaii Refining, LLC (“PHR“), our wholly owned subsidiary, entered into an inventory intermediation agreement with Citigroup Energy Inc.

(“Citi”) (the “Inventory Intermediation Agreement”) to support our Hawaii refining operations.

Pursuant to the Inventory Intermediation Agreement, Citi will finance and hold title to crude oil in storage tanks and certain crude oil in transit to be consumed by PHR’s refinery located in Kapolei, Hawaii (the “Hawaii Refinery”).

In connection with the Inventory Intermediation Agreement, Citi will enter into certain hedging transactions, in each case, on terms and subject to conditions set forth in the Inventory Intermediation Agreement.

The net cash proceeds of $ 203.1 million, presented as Proceeds from inventory financing agreements in our condensed consolidated statement of cash flows, were used to settle a portion of PHR’s outstanding obligations under the prior J.

Aron intermediation agreement.

Upon entry into the Inventory Intermediation Agreement, Citi purchased from PHR all the crude oil held in its Hawaii storage tanks.

Though title resides with Citi, the Inventory Intermediation Agreement is accounted for similar to a product financing arrangement and the crude oil inventories will continue to be included in our consolidated balance sheets until processed and sold to a third party.

Monthly, we record a liability in an amount equal to the amount we expect to pay to repurchase the inventory held by Citi as, following expiration or termination of the Inventory Intermediation Agreement, we are obligated to purchase the crude oil then-owned by Citi at then-current market prices.

The Inventory Intermediation Agreement has a term of three years with a one-year extension option upon mutual agreement.

Par Petroleum, LLC, a wholly owned subsidiary, guarantees PHR’s obligations under the Inventory Intermediation Agreement and certain other related agreements pursuant to an unsecured guaranty.

In connection with the Inventory Intermediation Agreement, on May 31, 2024, PHR entered into a pledge and security agreement with Citi, which grants Citi a security interest on certain collateral to secure the obligations of PHR under the Inventory Intermediation Agreement.

The Inventory Intermediation Agreement also requires PHR to comply with certain covenants that restrict PHR’s ability to take certain actions, including certain limitations on PHR’s ability to incur debt and grant liens.

PAR PACIFIC HOLDINGS, INC.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

Supply and Offtake Agreement

We have a supply and offtake agreement with J.

Prior to May 31, 2024, we had a supply and offtake agreement with J.

Aron to support our Hawaii refining operations (the “Supply and Offtake Agreement").

Under the Supply and Offtake Agreement, we pay or receive certain fees from J.

Under the Supply and Offtake Agreement, we paid or received certain fees from J.

Aron based on changes in market prices over time.

The amount due to or from J.

Aron was recorded as an adjustment to our Obligations under inventory financing agreements as allowed under the Supply and Offtake Agreement.

The Supply and Offtake Agreement expires May 31, 2024 (as extended, the “Expiration Date”).

On May 31, 2024, the Supply and Offtake Agreement expired, the J.

Aron Discretionary Draw Facility was terminated, and we entered into the Inventory Intermediation Agreement.

We paid $ 382.1 million and $ 60.9 million to settle our J.

Aron obligation and Discretionary Draw Facility remaining obligations, respectively.

These payments are presented within Payments for termination of inventory financing agreements and Net borrowings (repayments) on deferred payment arrangements and receivable advances in our condensed consolidated statement of cash flows.

In connection with the termination of the Supply and Offtake Agreement, we recognized termination costs of $ 0.2 million, which are recorded in Debt extinguishment and commitment costs on our condensed consolidated statements of operations for the three and six months ended June 30, 2024.

As of June 30, 2024, there were no outstanding obligations under the Supply and Offtake Agreement.

LC Facility due 2024

On July 26, 2023, PHR, as borrower, the lenders and letter of credit issuing banks party thereto (collectively, the “LC Facility Lenders”), MUFG Bank, Ltd., as administrative agent (the “LC Facility Agent”), sub-collateral agent, joint lead arranger and sole bookrunner, Macquarie Bank Limited, as joint lead arranger, and U.S.

Bank Trust Company, National Association, as collateral agent (the “Collateral Agent”), entered into an Uncommitted Credit Agreement (the “LC Facility Agreement”) whereby the LC Facility Lenders agree, on an uncommitted and absolutely discretionary basis, to consider making revolving credit loans and issuing and participating in letters of credit.

The LC Facility will mature on July 25, 2024, unless the obligations are accelerated and the maximum credit limits of the LC Facility Lenders are terminated prior to such date.

Bank Trust Company, National Association, as collateral agent (the “Collateral Agent”), entered into an Uncommitted Credit Agreement (the “LC Facility Agreement”) whereby the LC Facility Lenders agreed, on an uncommitted and absolutely discretionary basis, to consider making revolving credit loans and issuing and participating in letters of credit.

The LC Facility was terminated on May 31, 2024, in connection with the termination of the Supply and Offtake Agreement and entry into the Inventory Intermediation Agreement.

In connection with the termination of the LC Facility, we recognized debt extinguishment costs of $ 0.6 million, which are included in Debt extinguishment and commitment costs on our condensed consolidated statements of operations for the three and six months ended June 30, 2024.

We did not have any outstanding borrowings under the LC Facility as of the termination date.

The following table summarizes our outstanding borrowings, letters of credit, and contractual undertaking obligations under the intermediation agreements (in thousands):

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Discretionary Draw Facility

Outstanding borrowings (1)

$ 167,902 $ 165,459

Borrowing capacity

169,765 175,891

MLC receivable advances

Outstanding borrowings (1)

Borrowing capacity

LC Facility due 2024

1 unchanged sentence

Borrowing capacity

120,000 120,000

MLC issued letters of credit — —

LC Facility issued letters of credit

______________________________________________________

(1) Borrowings outstanding under the Discretionary Draw Facility and MLC receivable advances are included in Obligations under inventory financing agreements on our condensed consolidated balance sheets.

(1) Borrowings outstanding under the Discretionary Draw Facility are included in Obligations under inventory financing agreements on our condensed consolidated balance sheets.

Changes in the borrowings outstanding under these arrangements are included within Cash flows from financing activities on the condensed consolidated statements of cash flows.

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Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

The following table summarizes the inventory intermediation fees, which are included in Cost of revenues (excluding depreciation) on our condensed consolidated statements of operations, and Interest expense and financing costs, net related to the intermediation agreements (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Net fees and expenses:

Inventory Intermediation Agreement

Inventory intermediation fees (1) $ 6,036 $ — $ 6,036 $ —

Interest expense and financing costs, net 105 — 105 —

Supply and Offtake Agreement

2 unchanged sentences

Washington Refinery Intermediation Agreement

Inventory intermediation fees (benefits) $ — $ 750

Inventory intermediation fees

$ — $ 750 $ — $ 1,500

Interest expense and financing costs, net — 3,313 — 5,972

2 unchanged sentences

___________________________________________________

(1) Inventory intermediation fees under the Supply and Offtake Agreement include market structure fees of $ 8.8 million and $ 2.4 million for the three months ended March 31, 2024 and 2023, respectively.

The Supply and Offtake Agreement also provide us with the ability to economically hedge price risk on our inventories and crude oil purchases.

Please read Note 12—Derivatives for further information.

(1) Inventory intermediation fees under the Inventory Intermediation Agreement include market structure fees of $ 4.6 million for the three and six months ended June 30, 2024.

Inventory intermediation fees under the Supply and Offtake Agreement include market structure fees of $ 4.6 million and $ 1.8 million for the three months ended June 30, 2024 and 2023 and $ 13.5 million and $ 4.2 million for the six months ended June 30, 2024 and 2023, respectively.

Note 10— Other Accrued Liabilities

Other accrued liabilities at March 31, 2024 and December 31, 2023 consisted of the following (in thousands):

March 31, 2024 December 31, 2023

Other accrued liabilities at June 30, 2024 and December 31, 2023 consisted of the following (in thousands):

June 30, 2024 December 31, 2023

Accrued payroll and other employee benefits $ 28,003 $ 40,533

7 unchanged sentences

A portion of these obligations are expected to be settled with our RINs assets and other environmental credits, which are presented as Inventories on our condensed consolidated balance sheet and are stated at the lower of cost or net realizable value.

The carrying costs of these assets were $ 128.7 million and $ 237.6 million as of March 31, 2024 and December 31, 2023, respectively.

The carrying costs of these assets were $ 160.1 million and $ 237.6 million as of June 30, 2024 and December 31, 2023, respectively.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

Note 11— Debt

The following table summarizes our outstanding debt (in thousands):

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

ABL Credit Facility due 2028

8 unchanged sentences

Long-term debt, net of current maturities $ 1,054,590 $ 646,603

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

As of March 31, 2024 and December 31, 2023, we had $ 117.1 million and $ 133.7 million in letters of credit outstanding under the ABL Credit Facility, as defined below, respectively.

We had $ 56.4 million and $ 56.2 million in surety bonds outstanding as of March 31, 2024 and December 31, 2023, respectively.

As of June 30, 2024 and December 31, 2023, we had $ 141.7 million and $ 133.7 million in letters of credit outstanding under the ABL Credit Facility, as defined below, respectively.

We had $ 57.1 million and $ 56.2 million in surety bonds outstanding as of June 30, 2024 and December 31, 2023, respectively.

Under the ABL Credit Facility and the Term Loan Credit Agreement, defined below, our subsidiaries are restricted from paying dividends or making other equity distributions, subject to certain exceptions.

2 unchanged sentences

On March 22, 2024, we entered into the Third Amendment (the “Third Amendment”) to the ABL Credit Facility.

The Third Amendment provided for, among other things, (i) incremental commitments that increase the total revolver commitment under the ABL Credit Facility to $ 1.4 billion , (i i) future incremental increases up to $ 400 million, (iii) the joinder of PHR to the ABL Credit Facility as a Borrower and (iv) certain other amendments to the ABL Credit Facility to permit a new intermediation facility in favor of PHR, in each case subject to the satisfaction of certain conditions set forth in the Third Amendment, including the termination of the Company’s existing intermediation agreement with J.

We recorded deferred financing costs of $ 3.8 million related to the Third Amendment that will be amortized over the remaining term of the ABL Credit Facility.

As of March 31, 2024, the ABL Credit Facility had $ 105 million outstanding in revolving loans , and a borrowing base of approxi mately $ 567.5 million.

On May 31, 2024, in connection with the entry into the Inventory Intermediation Agreement, PHR entered into a Joinder Agreement, as a borrower to the ABL Credit Facility.

As of June 30, 2024, the ABL Credit Facility had $ 525 million outstanding in revolving loans , and a borrowing base of approxi mately $ 1.0 billion.

Term Loan Credit Agreement due 2030

3 unchanged sentences

The net proceeds were used to refinance our existing Term Loan B Facility, repurchase our outstanding 7.75 % Senior Secured Notes and 12.875 % Senior Secured Notes, and for general corporate purposes.

We recognized an aggregate of $ 2.8 million in debt modification costs in connection with the refinancing, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023.

On April 8, 2024, we entered into Amendment No.

On April 8, 2024, the Term Loan Credit Agreement was amended by the Amendment No.

1 to Term Loan Credit Agreement (“Amendment No.

1 to Term Loan Credit Agreement”).

please read Note 20—Subsequent Events for further information.

Amendment No.

1 to Term Loan Credit Agreement provided for, among other things, (i) a reduction in the Applicable Margin under the Term Loan Credit Agreement by 50 basis points, such that base rate loans and SOFR loans will bear interest at the applicable base rate plus 2.75 % and 3.75 %, respectively, and (ii) the elimination of the Term SOFR Adjustment of 10 basis points with respect to loans under the Term Loan Credit Agreement.

The Term Loan Credit Agreement requires quarterly payments of $ 1.4 million on the last business day of each March, June, September and December, commencing on June 30, 2023, with the balance due upon maturity.

The Term Loan Credit Agreement matures on February 28, 2030.

7.75 % Senior Secured Notes due 2025

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

7.75 % Senior Secured Notes

On December 21, 2017, Par Petroleum, LLC and Par Petroleum Finance Corp.

2 unchanged sentences

On March 17, 2023, we repurchased and cancelled all remaining outstanding 7.75 % Senior Secured Notes at a repurchase price of 101.938 % of the aggregate principal amount repurchased.

In connection with the termination of the 7.75 % Senior Secured Notes, we recognized debt extinguishment costs of $ 5.9 million associated with debt repurchase premiums and $ 3.4 million associated with unamortized deferred financing costs, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023.

Our 7.75 % Senior Secured Notes bore interest at a rate of 7.750 % per year (payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2018).

Term Loan B Facility due 2026

Term Loan B Facility

On January 11, 2019, the Issuers entered into a new term loan facility with Goldman Sachs Bank USA, as administrative agent, and the lenders party thereto from time to time (the “Term Loan B Facility”).

On February 28, 2023, we terminated and repaid all amounts outstanding under the Term Loan B Facility.

We recognized debt extinguishment costs of $ 1.7 million associated with unamortized deferred financing costs, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

Term Loan B Facility bore interest at a rate per annum equal to Adjusted LIBOR (as defined in the Term Loan B Facility) plus an applicable margin of 6.75 % or at a rate per annum equal to Alternate Base Rate (as defined in the Term Loan B Facility) plus an applicable margin of 5.75 %.

The Term Loan B Facility bore interest at a rate per annum equal to Adjusted LIBOR (as defined in the Term Loan B Facility) plus an applicable margin of 6.75 % or at a rate per annum equal to Alternate Base Rate (as defined in the Term Loan B Facility) plus an applicable margin of 5.75 %.

In addition to the quarterly interest payments, the Term Loan B Facility required quarterly principal payments of $ 3.1 million.

12.875 % Senior Secured Notes due 2026

12.875 % Senior Secured Notes

On June 5, 2020, the Issuers completed the issuance and sale of $ 105.0 million in aggregate principal amount of 12.875 % Senior Secured Notes in a private placement under Rule 144A and Regulation S of the Securities Act of 1933, as amended.

1 unchanged sentence

On March 17, 2023, we repurchased and cancelled all remaining outstanding 12.875 % Senior Secured Notes at a repurchase price of 108.616 % of the aggregate principal amount repurchased.

In connection with the termination of the 12.875 % Senior Secured Notes, we recognized debt extinguishment costs of $ 2.8 million associated with debt repurchase premiums and $ 1.1 million associated with unamortized deferred financing costs, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023.

The 12.875 % Senior Secured Notes bore interest at an annual rate of 12.875 % per year (payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2021).

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Included within each of our debt agreements are affirmative and negative covenants, and customary cross default provisions, that require the repayment of amounts outstanding on demand unless the triggering payment default or acceleration is remedied, rescinded, or waived.

As of March 31, 2024, we were in compliance with all of our debt instruments .

As of June 30, 2024, we wer e in compliance w ith all of our debt instruments .

In connection with our shelf registration statement on Form S-3, which was filed with the Securities and Exchange Commission (“SEC”) and became automatically effective on February 14, 2022 (“Registration Statement”), we may sell non-convertible debt securities and other securities in one or more offerings with an aggregate initial offering price of up to $ 750.0 million.

Any non-convertible debt securities issued under the Registration Statement may be fully and unconditionally guaranteed (except for customary release provisions), on a joint and several basis, by some or all of our subsidiaries, other than subsidiaries that are “minor” within the meaning of Rule 3-10 of Regulation S-X (the “Guarantor Subsidiaries”).

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

subsidiaries that are “minor” within the meaning of Rule 3-10 of Regulation S-X (the “Guarantor Subsidiaries”).

We have excluded the summarized financial information for the Guarantor Subsidiaries as the assets and results of operations of the Company and the Guarantor Subsidiaries are not materially different than the corresponding amounts presented on our consolidated financial statements.

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Please read Note 13—Fair Value Measurements for the gross fair value and net carrying value of our derivative instruments.

Our open futures and over-the-counter (“OTC”) swaps expire in March 2025 .

At March 31, 2024, our open commodity derivative contracts represented (in thousands of barrels):

Our open futures and over-the-counter (“OTC”) swaps expire in April 2025.

At June 30, 2024, our open commodity derivative contracts represented (in thousands of barrels):

Contract Type Purchases Sales Net

2 unchanged sentences

Total 31,729 ( 40,142 ) ( 8,413 )

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

At March 31, 2024, we also had option collars that economically hedge a portion of our internally consumed fuel at our refineries.

The following table provides information on these option collars at our refineries as of March 31, 2024:

At June 30, 2024, we also had option collars that economically hedge a portion of our internally consumed fuel at our refineries.

The following table provides information on these option collars at our refineries as of June 30, 2024:

Total open option collars 1,128 90

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Weighted-average strike price - ceiling (in dollars) $ 86.48 $ 90.00

Earliest commencement date April 2024

Furthest expiry date December 2024

Earliest commencement date July 2024 January 2025

Furthest expiry date December 2024 March 2025

Interest Rate Derivatives

We are exposed to interest rate volatility in our ABL Credit Facility, LC Facility, Term Loan Credit Agreement, and the Supply and Offtake Agreement.

We are exposed to interest rate volatility in our ABL Credit Facility, Term Loan Credit Agreement, and the Inventory Intermediation Agreement.

We may utilize interest rate swaps to manage our interest rate risk.

On April 12, 2023, we entered into an interest rate collar transaction to manage our interest rate risk related to the Term Loan Credit Agreement.

The interest rate collar agreement reduces variable interest rate risk from May 31, 2023, through May 31, 2026, with a notional amount of $ 300.0 million as of March 31, 2024.

The interest rate collar agreement reduces variable interest rate risk from May 31, 2023, through May 31, 2026, with a notional amount of $ 300.0 million as of June 30, 2024.

The terms of the agreement provide for an interest rate cap of 5.50 % and floor of 2.30 %, based on the three month SOFR as of the fixing date.

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The interest rate collar transaction expires on May 31, 2026.

The following table provides information on the fair value amounts (in thousands) of these derivatives as of March 31, 2024 and December 31, 2023, and their placement within our condensed consolidated balance sheets.

Balance Sheet Location March 31, 2024 December 31, 2023

The following table provides information on the fair value amounts (in thousands) of these derivatives as of June 30, 2024 and December 31, 2023, and their placement within our condensed consolidated balance sheets.

Balance Sheet Location June 30, 2024 December 31, 2023

Asset (Liability)

3 unchanged sentences

Aron repurchase obligation derivative Obligations under inventory financing agreements — ( 392 )

Citi repurchase obligation derivative

Obligations under inventory financing agreements ( 409 ) —

Interest rate derivatives Other long-term assets 61 —

Interest rate derivatives Other liabilities — ( 821 )

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

_________________________________________________________

(1) Does not include cash collateral of $ 5.9 million and $ 21.8 million recorded in Prepaid and other current assets as of March 31, 2024 and December 31, 2023, respectively, and $ 9.5 million in Other long-term assets as of both March 31, 2024 and December 31, 2023.

Does not include $ 0.2 million recorded in Prepaid and other current assets as of March 31, 2024, related to realized derivatives receivable.

(2) Does not include $ 0.6 million and $ 27.2 million recorded in Other accrued liabilities as of March 31, 2024 and December 31, 2023, respectively, related to realized derivatives payable.

(1) Does not include cash collateral of $ 2.4 million and $ 21.8 million recorded in Prepaid and other current assets as of June 30, 2024 and December 31, 2023, respectively, and $ 9.5 million in Other long-term assets as of December 31, 2023.

As of June 30, 2024, we had no cash collateral recorded in Other long-term assets.

Does not include $ 15.6 million recorded in Prepaid and other current assets as of June 30, 2024 related to realized derivatives receivable.

(2) Does not include $ 2.9 million and $ 27.2 million recorded in Other accrued liabilities as of June 30, 2024 and December 31, 2023, respectively, related to realized derivatives payable.

The following table summarizes the pre-tax gains (losses) recognized in Net income (loss) on our condensed consolidated statements of operations resulting from changes in fair value of derivative instruments not designated as hedges charged directly to earnings (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Statement of Operations Location 2024 2023 2024 2023

1 unchanged sentence

Aron repurchase obligation derivative Cost of revenues (excluding depreciation) 22,869 ( 7,852 ) 1,053 5,528

Citi repurchase obligation derivative

Cost of revenues (excluding depreciation) ( 409 ) — ( 409 ) —

MLC terminal obligation derivative Cost of revenues (excluding depreciation) — 20,490 — 3,467

Interest rate derivatives Interest expense and financing costs, net 37 543 881 543

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

Note 13— Fair Value Measurements

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The fair value of real property was estimated using the market approach.

Key assumptions in the market approach include determining the asset value by evaluating recent purchases of comparable assets under similar circumstances.

Key assumptions in the market approach include

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

determining the asset value by evaluating recent purchases of comparable assets under similar circumstances.

We consider this to be a Level 3 fair value measurement.

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Level 2 instruments are valued using quoted prices for similar assets and liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability.

Our Level 2 instruments include

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

OTC swaps and options.

Our Level 2 instruments include OTC swaps and options.

These derivatives are valued using market quotations from independent price reporting agencies and commodity exchange price curves that are corroborated with market data.

Level 3 instruments are valued using significant unobservable inputs that are not supported by sufficient market activity.

The valuation of the embedded derivatives related to our J.

Aron repurchase obligation is based on estimates of the prices and differentials assuming settlement at the end of the reporting period.

Estimates of the J.

Aron settlement prices are based on observable inputs, such as Brent indices, and unobservable inputs, such as contractual price differentials as defined in the Supply and Offtake Agreement.

Such contractual differentials vary by location and by the type of product, have a weighted average premium of $ 9.46 , and range from a discount of $ 6.99 per barrel to a premium of $ 36.46 per ba rrel as of March 31, 2024.

The valuation of the embedded derivative related to our Citi repurchase obligation is based on estimates of the prices and a weighted-average price differential assuming settlement at the end of the reporting period.

Estimates of the Citi settlement prices are based on observable inputs, such as Brent indices, and unobservable inputs, such as contractual price differentials as defined in the Inventory Intermediation Agreement.

Contractual price differentials are considered unobservable inputs;

therefore, these embedded derivatives are classified as Level 3 instruments.

We do not have other commodity derivatives classified as Level 3 at March 31, 2024, or December 31, 2023.

We do not have other commodity derivatives classified as Level 3 at June 30, 2024, or December 31, 2023.

Please read Note 12—Derivatives for further information on derivatives.

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Environmental Protection Agency (“EPA”) regulations related to greenhouse gases.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

Financial Statement Impact

Fair value amounts by hierarchy level as of March 31, 2024 and December 31, 2023, are presented gross in the tables below (in thousands):

March 31, 2024

Fair value amounts by hierarchy level as of June 30, 2024, and December 31, 2023, are presented gross in the tables below (in thousands):

June 30, 2024

Level 1 Level 2 Level 3 Gross Fair Value Effect of Counter-Party Netting Net Carrying Value on Balance Sheet (1)

3 unchanged sentences

Commodity derivatives $ ( 53,445 ) $ ( 150,637 ) $ — $ ( 204,082 ) $ 173,638 $ ( 30,444 )

Aron repurchase obligation derivative — — ( 22,208 ) ( 22,208 ) — ( 22,208 )

Citi repurchase obligation derivative

— — ( 409 ) ( 409 ) — ( 409 )

Gross environmental credit obligations (2) (3)

1 unchanged sentence

Total liabilities $ ( 53,445 ) $ ( 160,989 ) $ ( 409 ) $ ( 214,843 ) $ 173,638 $ ( 41,205 )

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

December 31, 2023

8 unchanged sentences

_________________________________________________________

(1) Does not include cash collate ral of $ 15.4 million and $ 31.3 million as of March 31, 2024 and December 31, 2023, respectively, included within Prepaid and other current assets and Other long-term assets on our condensed consolidated balance sheets.

(2) Does not include RINs assets and other environmental credits of $ 128.7 million and $ 237.6 million presented as Inventories on our condensed consolidated balance sheet and stated at the lower of cost and net realizable value as of March 31, 2024 and December 31, 2023, respectively.

(3) Does not include environmental liabilities of $ 140.3 million and $ 232.7 million satisfied by internally generated or purchased environmental credits and presented at the carrying value of these credits included in Other Accrued Liabilities on our condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, respectively.

(1) Does not include cash collate ral of $ 2.4 million and $ 31.3 million as of June 30, 2024 and December 31, 2023, respectively, included within Prepaid and other current assets and Other long-term assets on our condensed consolidated balance sheets.

(2) Does not include RINs assets and other environmental credits of $ 179.3 million and $ 237.6 million included in Inventories and Other long-term assets on our condensed consolidated balance sheet and stated at the lower of cost and net realizable value as of June 30, 2024 and December 31, 2023, respectively.

(3) Does not include environmental liabilities of $ 206.5 million and $ 232.7 million satisfied by internally generated or purchased environmental credits and presented at the carrying value of these credits included in Other Accrued Liabilities and Other liabilities on our condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023, respectively.

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

A roll forward of Level 3 derivative instruments measured at fair value on a recurring basis is as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Balance, at beginning of period $ ( 22,208 ) $ ( 5,979 ) $ ( 392 ) $ 2,279

4 unchanged sentences

(1) Included in Cost of revenues (excluding depreciation) on our condensed consolidated statements of operations.

The carrying value and fair value of long-term debt and other financial instruments as of March 31, 2024 and December 31, 2023 are as follows (in thousands):

March 31, 2024

The carrying value and fair value of long-term debt and other financial instruments as of June 30, 2024 and December 31, 2023 are as follows (in thousands):

June 30, 2024

Carrying Value Fair Value

1 unchanged sentence

$ 525,000 $ 525,000

LC Facility due 2024 (2)

Term Loan Credit Agreement due 2030 (1)

1 unchanged sentence

Other long-term debt (1) 4,431 4,111

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

December 31, 2023

1 unchanged sentence

ABL Credit Facility due 2028 (2) $ 115,000 $ 115,000

LC Facility due 2024 (2) — —

Term Loan Credit Agreement due 2030 (1) 531,112 545,875

2 unchanged sentences

(1) The fair value measurements of the Term Loan Credit Agreement and Other long-term debt are considered Level 2 measurements in the fair value hierarchy as discussed below.

(2) The fair value measurements of the ABL Credit Facility and LC Facility are considered Level 3 measurements in the fair value hierarchy.

(2) The fair value measurements of the ABL Credit Facility are considered Level 3 measurements in the fair value hierarchy.

The fair values of the Term Loan Credit Agreement and Other long-term debt were determined using a market approach based on quoted prices and the inputs used to measure the fair value are classified as Level 2 inputs within the fair value hierarchy.

The carrying value of our ABL Credit Facility was determined to approximate fair value as of March 31, 2024.

The carrying value of our ABL Credit Facility was determined to approximate fair value as of June 30, 2024.

The fair value of all non-derivative financial instruments recorded in current assets, including cash and cash equivalents, restricted cash, and trade accounts receivable, and current liabilities, including accounts payable, approximate their carrying value due to their short-term nature.

6 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

The following table provides information on the amounts (in thousands) of our right-of-use assets (“ROU assets”) and liabilities, weighted-average remaining lease term, and weighted average discount rate as of March 31, 2024 and December 31, 2023 and their placement within our condensed consolidated balance sheets:

Lease type Balance Sheet Location March 31, 2024 December 31, 2023

For the Interim Periods Ended June 30, 2024 and 2023

The following table provides information on the amounts (in thousands) of our right-of-use assets (“ROU assets”) and liabilities, weighted-average remaining lease term, and weighted average discount rate as of June 30, 2024, and December 31, 2023 and their placement within our condensed consolidated balance sheets:

Lease type Balance Sheet Location June 30, 2024 December 31, 2023

Finance Property, plant, and equipment $ 30,136 $ 28,264

16 unchanged sentences

The following table summarizes the lease costs and income recognized in our condensed consolidated statements of operations (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Lease cost (income) type 2024 2023 2024 2023

12 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

The following table summarizes the supplemental cash flow information related to leases as follows (in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

Lease type 2024 2023

7 unchanged sentences

ROU assets terminated in exchange for release from operating lease liabilities — —

The table below includes the estimated future undiscounted cash flows for finance and operating leases as of March 31, 2024 (in thousands):

The table below includes the estimated future undiscounted cash flows for finance and operating leases as of June 30, 2024 (in thousands):

For the year ending December 31, Finance leases Operating leases Total

10 unchanged sentences

_________________________________________________________

(1) Represents the period from April 1, 2024 to December 31, 2024.

(1) Represents the period from July 1, 2024 to December 31, 2024.

Additionally, we have $ 9.3 million in future undiscounted cash flows for operating leases that have not yet commenced.

15 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

Par Pacific Holdings, Inc.

17 unchanged sentences

Investigative work by Hermes Consolidated LLC, and its wholly owned subsidiary, Wyoming Pipeline Company, (collectively, “WRC” or “Wyoming Refining”) and negotiations with the relevant agencies as to remedial approaches remain ongoing on a number of aspects of the contamination, meaning that investigation, monitoring, and remediation costs are not reasonably estimable for some elements of these efforts.

As of March 31, 2024, we have accrued $ 13.7 million for the well-understood components of these efforts based on current information, approximately one-third of which we expect to incur in the next five years and the remainder to be incurred over approximately 30 years.

As of June 30, 2024, we have accrued $ 13.6 million for the well-understood components of these efforts based on current information, approximately one-third of which we expect to incur in the next five years and the remainder to be incurred over approximately 30 years.

Additionally, we believe the Wyoming refinery will need to modify or close a series of wastewater impoundments in the next several years and replace those impoundments with a new wastewater treatment system.

10 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

certain producers to buy or sell credits was also signed into law and became effective in 2023.

12 unchanged sentences

On August 2, 2023, the Board expanded the share repurchase authorization from $ 50 million to $ 250 million.

During the three months ended March 31, 2024, 906 thousand shares were repurchased under this share repurchase program for $ 32.4 million.

During the three and six months ended June 30, 2024, 2,209 thousand and 3,115 thousand shares were repurchased under this share repurchase program for $ 67.1 million and $ 99.5 million, respectively.

The repurchased shares were retired by the Company upon receipt.

During the three months ended March 31, 2023, no shares were repurchased under this share repurchase program.

As of March 31, 2024, there was $ 149.4 million of authorization remaining under this share repurchase program.

During the three and six months ended June 30, 2023, 110 thousand shares were repurchased under this share repurchase program for $ 2.6 million.

As of June 30, 2024, there was $ 83.2 million of authorization remaining under this share repurchase program.

Incentive Plans

1 unchanged sentence

2012 Long-term Incentive Plan and Stock Purchase Plan (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Restricted Stock Awards $ 2,105 $ 2,656 $ 6,301 $ 4,052

3 unchanged sentences

During the first quarter of 2024, the Board approved the acceleration of unvested equity awards and the modification of vested stock options granted to him.

For the three months ended March 31, 2024, we recorded a total of $ 13.1 million stock-based compensation expenses resulting from the equity awards modifications.

During the three months ended March 31, 2024, we granted 260 thousand shares of restricted stock and restricted stock units with a fair value of approximately $ 10.1 million.

As of March 31, 2024, there were approximately $ 18.2 million of total unrecognized compensation costs related to restricted stock awards and restricted stock units, which are expected to be recognized on a straight-line basis over a weighted-average period of 1.7 years.

For the six months June 30, 2024, we recorded a total of $ 13.1 million stock-based compensation expenses resulting from the equity awards modifications.

During the three and six months ended June 30, 2024, we granted 9 thousand and 269 thousand shares of restricted stock and restricted stock units with a fair value of approximately $ 0.3 million and $ 10.5 million, respectively.

As of June 30, 2024, there were approximately $ 16.0 million of total unrecognized compensation costs related to restricted stock awards and restricted stock units, which are expected to be recognized on a straight-line basis over a weighted-average period of 1.5 years.

PAR PACIFIC HOLDINGS, INC.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

During the three months ended March 31, 2024, we granted no stock option awards.

As of March 31, 2024, there were approximately $ 0.3 million of total unrecognized compensation costs related to stock option awards, which are expected to be recognized on a straight-line basis over a weighted-average period of 1.3 years.

During the three months ended March 31, 2024, we granted 64 thousand performance restricted stock units to executive officers.

For the Interim Periods Ended June 30, 2024 and 2023

During the three and six months ended June 30, 2024, we granted 350 thousand stock option awards with a weighted-average exercise price of $ 30.80 per share.

As of June 30, 2024, there were approximately $ 6.6 million of total unrecognized compensation costs related to stock option awards, which are expected to be recognized on a straight-line basis over a weighted-average period of 4.7 years.

During the six months ended June 30, 2024, we granted 64 thousand performance restricted stock units to executive officers;

no grants were made for the three months ended June 30, 2024.

These performance restricted stock units had a fair value of approximately $ 2.5 million and are subject to certain annual performance targets based on three-year -performance periods as defined by our Board of Directors.

As of March 31, 2024, there were approximately $ 3.4 million of total unrecognized compensation costs related to the performance restricted stock units, which are expected to be recognized on a straight-line basis over a weighted-average period of 2.6 years.

As of June 30, 2024, there were approximately $ 3.1 million of total unrecognized compensation costs related to the performance restricted stock units, which are expected to be recognized on a straight-line basis over a weighted-average period of 2.4 years.

Note 17— Income (Loss) per Share

The following table sets forth the computation of basic and diluted income (loss) per share (in thousands, except per share amounts):

Three Months Ended March 31,

Net income (loss) $ ( 3,751 ) $ 237,890

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Net income $ 18,638 $ 30,013 $ 14,887 $ 267,903

Net income effect of convertible securities — — — —

Numerator for diluted income (loss) per common share $ ( 3,751 ) $ 237,890

Numerator for diluted income per common share $ 18,638 $ 30,013 $ 14,887 $ 267,903

Basic weighted-average common stock shares outstanding 57,239 60,399 57,936 60,255

dilutive effects of common stock equivalents

806 594 466 765

Diluted weighted-average common stock shares outstanding 58,045 60,993 58,402 61,020

Basic income (loss) per common share $ ( 0.06 ) $ 3.96

Diluted income (loss) per common share $ ( 0.06 ) $ 3.90

Diluted income (loss) per common share excludes the following equity instruments because their effect would be anti-dilutive:

Basic income per common share $ 0.33 $ 0.50 $ 0.26 $ 4.45

Diluted income per common share $ 0.32 $ 0.49 $ 0.25 $ 4.39

Diluted income per common share excludes the following equity instruments because their effect would be anti-dilutive:

Shares of unvested restricted stock 324 321 228 254

Shares of stock options 238 108 119 54

_________________________________________________________

(1) Entities with a net loss from continuing operations are prohibited from including potential common shares in the computation of diluted per share amounts.

We have utilized the basic shares outstanding to calculate both basic and diluted Net Loss per common share for the three months ended March 31, 2024.

Note 18— Income Taxes

Effective for the three months ended March 31, 2024, we began calculating our income tax provision using the estimated annual effective tax rate method in accordance with Accounting Standards Codification “ASC” 740 - Income Taxes and we no longer apply the exception that allowed the use of the year-to-date effective tax rate method.

Effective in the first quarter of 2024, we began calculating our income tax provision using the estimated annual effective tax rate method in accordance with Accounting Standards Codification “ASC” 740 - Income Taxes and we no longer apply the exception that allowed the use of the year-to-date effective tax rate method.

We believe the change in this calculation is appropriate as it allows us to reliably calculate the estimated annual effective tax rate due to our sustained profitability and confidence in future earnings.

Our effective tax rate for the three months ended March 31, 2024, differs from the statutory rates primarily as a result of the differing apportionment rates for our state income taxes as well as an adjustment for equity compensation.

For the three months ended March 31, 2023, our effective tax rate differed from the statutory rates primarily as a result of our various state income tax apportionment factors, equity compensation, and the recording of a valuation allowance.

Our effective tax rate for the three and six months ended June 30, 2024, differs from the statutory rates primarily as a result of the differing apportionment rates for our state income taxes as well as an adjustment for equity compensation.

For the three and six months ended June 30, 2023, our effective tax rate differed from the statutory rates primarily as a result of our various state income tax apportionment factors, equity compensation, and the recording of a valuation allowance.

Our net taxable income must be apportioned to various states based upon the income tax laws of the states in which we derive our revenue.

5 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

Note 19— Segment Information

2 unchanged sentences

Summarized financial information concerning reportable segments consists of the following (in thousands):

Three Months Ended March 31, 2024 Refining Logistics Retail Corporate, Eliminations and Other (1) Total

Three Months Ended June 30, 2024 Refining Logistics Retail Corporate, Eliminations and Other (1) Total

Revenues $ 1,957,273 $ 72,475 $ 152,842 $ ( 165,122 ) $ 2,017,468

8 unchanged sentences

Par West redevelopment and other costs — — — 3,071 3,071

Loss (gain) on sale of assets, net — 61 ( 10 ) — 51

Loss on sale of assets, net — 63 — — 63

Operating income (loss) $ 41,206 $ 18,041 $ 16,053 $ ( 26,659 ) $ 48,641

2 unchanged sentences

Other expense, net ( 124 )

Equity earnings from Laramie Energy, LLC 4,563

Loss before income taxes ( 6,382 )

Income tax benefit 2,631

Net loss $ ( 3,751 )

Equity losses from Laramie Energy, LLC ( 1,360 )

Income before income taxes 25,305

Income tax expense ( 6,667 )

Net income $ 18,638

Capital expenditures $ 29,763 $ 4,653 $ 1,528 $ 946 $ 36,890

Three Months Ended March 31, 2023 Refining Logistics Retail Corporate, Eliminations and Other (1) Total

PAR PACIFIC HOLDINGS, INC.

AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended June 30, 2024 and 2023

Three Months Ended June 30, 2023 Refining Logistics Retail Corporate, Eliminations and Other (1) Total

Revenues $ 1,708,541 $ 64,709 $ 148,396 $ ( 137,719 ) $ 1,783,927

5 unchanged sentences

General and administrative expense (excluding depreciation) — — — 23,168 23,168

Equity earnings from refining and logistics investments

— ( 425 ) — — ( 425 )

Acquisition and integration costs — — — 7,273 7,273

3 unchanged sentences

Debt extinguishment and commitment costs 38

Other income, net 379

Income before income taxes 31,941

Income tax expense ( 1,928 )

Net income $ 30,013

Capital expenditures $ 6,301 $ 7,124 $ 3,104 $ 987 $ 17,516

________________________________________________________

(1) Includes eliminations of intersegment revenues and cost of revenues of $ 165.1 million and $ 137.7 million for the three months ended June 30, 2024 and 2023, respectively.

Six Months Ended June 30, 2024 Refining Logistics

Retail Corporate, Eliminations and Other (1) Total

Revenues $ 3,883,889 $ 144,317 $ 292,976 $ ( 322,879 ) $ 3,998,303

Cost of revenues (excluding depreciation)

3,539,205 87,075 214,296 ( 322,901 ) 3,517,675

Operating expense (excluding depreciation)

242,977 8,513 45,850 — 297,340

Depreciation and amortization 43,961 13,968 5,791 1,080 64,800

Loss (gain) on sale of assets, net — 124 ( 10 ) — 114

General and administrative expense (excluding depreciation) — — — 64,923 64,923

Equity earnings from refining and logistics investments ( 6,060 ) ( 3,778 ) — — ( 9,838 )

Acquisition and integration costs — — — 91 91

Par West redevelopment and other costs — — — 5,042 5,042

Operating income (loss) $ 63,806 $ 38,415 $ 27,049 $ ( 71,114 ) $ 58,156

Interest expense and financing costs, net ( 38,318 )

Debt extinguishment and commitment costs ( 1,418 )

Other expense, net ( 2,700 )

7 unchanged sentences

Notes to Condensed Consolidated Financial Statements

For the Interim Periods Ended March 31, 2024 and 2023

For the Interim Periods Ended June 30, 2024 and 2023

Six Months Ended June 30, 2023 Refining Logistics

Retail Corporate, Eliminations and Other (1)

Revenues $ 3,323,953 $ 117,097 $ 283,968 $ ( 255,882 ) $ 3,469,136

Cost of revenues (excluding depreciation)

2,845,275 67,087 207,396 ( 255,932 ) 2,863,826

(1) Includes eliminations of intersegment revenues and cost of revenues of $ 157.8 million and $ 118.2 million for the three months ended March 31, 2024 and 2023, respectively.

Note 20— Subsequent Events

Amendment No.

1 to Term Loan Credit Agreement

On April 8, 2024, the Term Loan Credit Agreement was amended by the Amendment No.

1 to Term Loan Credit Agreement (“Amendment No.

1 to Term Loan Credit Agreement”).

Amendment No.

1 to Term Loan Credit Agreement provided for, among other things, (i) a reduction in the Applicable Margin under the Term Loan Credit Agreement by 50 basis points, such that base rate loans and SOFR loans will bear interest at the applicable base rate plus 2.75 % and 3.75 %, respectively and (ii) the elimination of the Term SOFR Adjustment of 10 basis points with respect to loans under the Term Loan Credit Agreement.

Operating expense (excluding depreciation)

135,853 7,043 42,067 — 184,963

Depreciation and amortization 35,549 10,093 5,811 1,123 52,576

General and administrative expense (excluding depreciation) — — — 42,454 42,454

Equity earnings from refining and logistics investments — ( 425 ) — — ( 425 )

Acquisition and integration costs — — — 12,544 12,544

Par West redevelopment and other costs — — — 5,363 5,363

Operating income (loss) $ 307,276 $ 33,299 $ 28,694 $ ( 61,434 ) $ 307,835

Interest expense and financing costs, net ( 31,159 )

Debt extinguishment and commitment costs ( 17,682 )

Other income, net 344

Equity earnings from Laramie Energy, LLC 10,706

Income before income taxes 270,044

Income tax expense ( 2,141 )

Net income $ 267,903

Capital expenditures $ 13,955 $ 8,005 $ 7,254 $ 1,515 $ 30,729

________________________________________________________

(1) Includes eliminations of intersegment revenues and cost of revenues of $ 322.9 million and $ 255.9 million for the six months ended June 30, 2024 and 2023, respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements