Cvr Energy Inc 10-Q for FY2025 Q2
Cvr Energy Inc (CVI)
10-Q
2025-07-31
For: 2025-06-30
View Original
Added on
April 07, 2026
About this 10-Q
Cvr Energy Inc filed this 10-Q on July 31, 2025, covering the quarter ended June 30, 2025 (FY2025 Q2).
Headline figures
Quarter ended June 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $1.76B
- down 10.5% from $1.97B a year earlier
- Net loss
- $114M
- compared with net income of $21M a year earlier
- Diluted EPS
- -$1.14
- compared with $0.21 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One) | ||||||||
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||
| For the quarterly period ended | ||||||||
| OR | ||||||||
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||
For the transition period from to | ||||||||
Commission file number: 001-33492
(Exact name of registrant as specified in its charter)
 | ||||||||||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
(Address of principal executive offices) (Zip Code)
(281 ) 207-3200
(Registrant’s telephone number, including area code)
_____________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☑ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | |||||||||||||
| Smaller reporting company | Emerging growth company | ||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
There were 100,530,599 shares of the registrant’s common stock outstanding at July 25, 2025.
TABLE OF CONTENTS
CVR Energy, Inc. - Quarterly Report on Form 10-Q
June 30, 2025
| PART I. Financial Information | PART II. Other Information | |||||||||||||||||||
Condensed Consolidated Balance Sheets - June 30, 2025 and December 31, 2024 (unaudited) | ||||||||||||||||||||
Condensed Consolidated Statements of Operations - Three and Six Months Ended June 30, 2025 and 2024 (unaudited) | ||||||||||||||||||||
Condensed Consolidated Statements of Changes in Equity - Three and Six Months Ended June 30, 2025 and 2024 (unaudited) | ||||||||||||||||||||
Condensed Consolidated Statements of Cash Flows - Six Months Ended June 30, 2025 and 2024 (unaudited) | ||||||||||||||||||||
| ||||||||||||||||||||
This Quarterly Report on Form 10-Q (including documents incorporated by reference herein) contains statements with respect to our expectations or beliefs as to future events. These types of statements are “forward-looking” and subject to uncertainties. See “Important Information Regarding Forward-Looking Statements” section of this filing.
June 30, 2025 | 2
Important Information Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q (this “Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including, but not limited to, those under Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Report. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. All statements other than statements of historical fact, including without limitation, statements regarding future operations, financial position, estimated revenues and losses, growth, capital projects, stock or unit repurchases, impacts of legal proceedings, projected costs, prospects, plans and objectives of management are forward looking statements. The words “could”, “believe”, “anticipate”, “intend”, “estimate”, “expect”, “may”, “continue”, “predict”, “potential”, “project”, and similar terms and phrases are intended to identify forward-looking statements.
Although we believe our assumptions concerning future events are reasonable, a number of risks, uncertainties, and other factors could cause actual results and trends to differ materially from those projected or forward looking. Forward looking statements, as well as certain risks, contingencies or uncertainties that may impact our forward-looking statements, include but are not limited to the following:
•volatile margins in the refining industry and exposure to the risks associated with volatile crude oil, refined product and feedstock prices;
•the availability of adequate cash and other sources of liquidity for the capital, operating and other needs of our businesses;
•the effects of the Russia-Ukraine war and the tensions and conflict in the Middle East and any spread or expansion thereof, including with respect to impacts to commodity prices and other markets;
•the effects of changes in market conditions; market volatility; crude oil and other commodity prices; demand for those commodities, storage and transportation capacities and costs, inflation, and the impact of such changes on our operating results and financial condition;
•the ability to forecast our future financial condition, results of operations, revenues and expenses accurately or at all;
•the effects of transactions involving derivative instruments;
•political uncertainty and impacts to the oil and gas industry and the United States and global economies generally as a result of actions taken by the current administration or others in response thereto, including the imposition of tariffs and reactions thereto and changes in climate or other energy laws, rules, regulations, or policies;
•interruption in pipelines supplying feedstocks or distributing the petroleum business’ products;
•competition in the petroleum and nitrogen fertilizer businesses, including potential impacts of domestic and global supply and demand or domestic or international duties, tariffs, or similar costs;
•capital expenditures;
•changes in our or our segments’ credit profiles and impacts thereof on cash needs or otherwise;
•the cyclical and seasonal nature of the petroleum and nitrogen fertilizer businesses;
•the supply, availability and price levels of raw materials and feedstocks and the effects of inflation thereupon;
•existing and future laws, regulations, rules, policies, or rulings, including changes, amendments, reinterpretations or amplification thereof and the actions of the current administration or future administrations relating thereto, and including but not limited to those relating to the environment and climate change; crude oil, refined products, other hydrocarbons or renewable feedstocks or products; renewable or alternative energy or fuel sources; electric vehicles; emissions and impacts thereof; safety and security; or the export, transportation, storage, sale or production of hazardous chemicals, materials or substances including potential liabilities or capital requirements arising from such laws, regulations, rules, policies, or rulings and the impacts thereof on macroeconomic factors, consumer activity or otherwise;
•our production levels, including the risk of a material decline thereof, as well as potential operating hazards, downtime, and damage to our or our counterparties’ facilities and other assets from accidents, fires, severe weather, tornadoes, floods, wildfires, or other natural disasters, accidents or other unscheduled shutdowns or interruptions affecting our facilities, machinery, people, or equipment, or those of our suppliers or customers;
•the impact of weather on commodity supply or pricing and on the nitrogen fertilizer business including our ability to produce, market or sell fertilizer products profitability or at all;
•rulings, judgments or settlements in litigation, tax or other legal or regulatory matters;
•the dependence of the nitrogen fertilizer business on customers and distributors including to transport goods and equipment and providers of feedstocks;
June 30, 2025 | 3
•the reliance on, or the ability to procure economically or at all, petroleum coke (“pet coke”) that our nitrogen fertilizer business purchases from our subsidiaries and third-party suppliers or the natural gas, electricity, oxygen, nitrogen, sulfur processing and compressed dry air and other products purchased from third parties by the nitrogen fertilizer and petroleum businesses and the facility operating risks associated with these third parties;
•risks of terrorism, cybersecurity attacks, and the security of chemical manufacturing facilities and other matters beyond our control;
•our lack of diversification of assets or operating and supply areas;
•the petroleum business’ and nitrogen fertilizer business’ dependence on significant customers and the creditworthiness and performance by counterparties;
•the potential loss of the nitrogen fertilizer business’ transportation cost advantage over its competitors;
•the potential inability to successfully implement our business strategies at all or on time and within budget, including significant capital programs or projects, turnarounds or other initiatives, and other projects;
•our ability to continue to license the technology used for our operations;
•the impact of refined product demand and declining inventories on refined product prices and crack spreads;
•Organization of Petroleum Exporting Countries’ (“OPEC”) and its allies’ production levels and pricing;
•the impact of renewable fuel credits, known as renewable identification numbers (“RINs”), pricing, our blending and purchasing activities, our ability to purchase RINs on a timely and cost effective basis or at all, and governmental actions, including by the U.S. Environmental Protection Agency (the “EPA”) on our RIN obligation, open RINs positions, small refinery exemptions, and our cost to comply with our Renewable Fuel Standard (“RFS”) obligations;
•our accounting policies and treatment, including of our RFS obligations;
•operational upsets or changes in laws that could impact the amount and receipt of credits (if any) under Section 45Q of the Internal Revenue Code of 1986, as amended, or any similar law, rule, or regulation;
•our ability to meet certain carbon capture and sequestration milestones;
•our businesses’ ability to obtain, retain or renew environmental and other governmental permits, licenses or authorizations necessary for the operation of its business;
•impact of potential runoff of water containing nitrogen based fertilizer into waterways and regulatory or legal actions in response thereto;
•our ability to issue securities, obtain financing or sell assets on terms favorable to us or at all;
•bank failures or other events affecting financial institutions;
•existing and future regulations related to the end-use of our products or the application of fertilizers;
•refinery and nitrogen fertilizer facilities’ operating hazards and interruptions, including unscheduled maintenance or downtime and the availability of adequate insurance coverage;
•risks related to services provided by or competition among our subsidiaries, including conflicts of interests and control of the general partner of CVR Partners, LP (“CVR Partners”), and control of CVR Energy, Inc. (“CVR Energy”) by its controlling shareholder;
•risks related to potential strategic transactions involving CVR Energy including, but not limited to, those in which its controlling shareholder or others may participate or direct and potential strategic transactions involving CVR Partners in which CVR Energy or its controlling shareholder or others may participate, including in each case the process of exploring any such transaction and potentially completing any such transaction, including the costs thereof and the risk that any such transaction may not achieve any or all of any anticipated benefits or be completed at all;
•instability and volatility in the capital and credit markets;
•restrictions in our debt agreements and our ability to refinance our debt on acceptable terms or at all;
•asset impairments and impacts thereof;
•our controlling shareholder’s intentions regarding ownership of our common stock or the common units of CVR Partners, including any acquisitions, dispositions or transactions relating thereto;
•the impact of any pandemic or breakout of infectious disease, and of businesses’ and governments’ responses thereto on our operations, personnel, commercial activity, and supply and demand across our and our customers’ and suppliers’ business;
•the variable nature of CVR Partners’ distributions, including the ability of its general partner to modify or revoke its distribution policy, or to cease making cash distributions on its common units;
•changes in tax and other laws, regulations and policies, including, without limitation, the One Big Beautiful Bill Act and actions of the past, current or future administrations that impact conventional fuel operations or favor renewable energy projects in the United States;
•changes in CVR Partners’ treatment as a partnership for U.S. federal income or state tax purposes;
•our ability to procure or recover under our insurance policies for damages or losses in full or at all;
•labor supply shortages, labor difficulties, labor disputes or strikes;
June 30, 2025 | 4
•impacts of any decision to return a unit back to hydrocarbon processing following renewable conversion; and
•the factors described in greater detail under “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 and our other filings with the U.S. Securities and Exchange Commission (“SEC”).
All forward-looking statements contained in this Report only speak as of the date of this Report. We undertake no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that occur after the date of this Report, or to reflect the occurrence of unanticipated events, except to the extent required by law.
Information About Us
Investors should note that we make available, free of charge on our website at www.CVREnergy.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. We also post announcements, updates, events, investor information and presentations on our website in addition to copies of all recent news releases. We may use the Investor Relations section of our website to communicate with investors. It is possible that the financial and other information posted there could be deemed to be material information. Documents and information on our website are not incorporated by reference herein.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers, including us, that file electronically with the SEC.
June 30, 2025 | 5
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CVR ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
Cash and cash equivalents (including $ | $ | $ | |||||||||
Accounts receivable, net (including $ | |||||||||||
Inventories (including $ | |||||||||||
Prepaid expenses (including $ | |||||||||||
Other current assets (including $ | |||||||||||
| Total current assets | |||||||||||
Property, plant, and equipment, net (including $ | |||||||||||
Other long-term assets (including $ | |||||||||||
| Total assets | $ | $ | |||||||||
LIABILITIES AND EQUITY | |||||||||||
| Current liabilities: | |||||||||||
Accounts payable (including $ | $ | $ | |||||||||
Other current liabilities (including $ | |||||||||||
| Total current liabilities | |||||||||||
| Long-term liabilities: | |||||||||||
Long-term debt and finance lease obligations, net of current portion (including $ | |||||||||||
| Deferred income taxes | |||||||||||
Other long-term liabilities (including $ | |||||||||||
| Total long-term liabilities | |||||||||||
Commitments and contingencies (See Note 12) | |||||||||||
| CVR Energy stockholders’ equity: | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in-capital | |||||||||||
| Accumulated deficit | ( | ( | |||||||||
Treasury stock, | ( | ( | |||||||||
Total CVR stockholders’ equity | |||||||||||
| Noncontrolling interest | |||||||||||
| Total equity | |||||||||||
| Total liabilities and equity | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
June 30, 2025 | 6
CVR ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions, except per share data) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Operating costs and expenses: | |||||||||||||||||||||||
Cost of materials and other | |||||||||||||||||||||||
Direct operating expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||
Cost of sales | |||||||||||||||||||||||
Selling, general and administrative expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||
| (Gain) loss on asset disposal | ( | ||||||||||||||||||||||
| Operating (loss) income | ( | ( | |||||||||||||||||||||
Other (expense) income: | |||||||||||||||||||||||
Interest expense, net | ( | ( | ( | ( | |||||||||||||||||||
| Other income, net | |||||||||||||||||||||||
| (Loss) income before income tax benefit | ( | ( | |||||||||||||||||||||
| Income tax benefit | ( | ( | ( | ( | |||||||||||||||||||
| Net (loss) income | ( | ( | |||||||||||||||||||||
| Less: Net income attributable to noncontrolling interest | |||||||||||||||||||||||
| Net (loss) income attributable to CVR Energy stockholders | $ | ( | $ | $ | ( | $ | |||||||||||||||||
| Basic and diluted (loss) earnings per share | $ | ( | $ | $ | ( | $ | |||||||||||||||||
| Weighted-average common shares outstanding: | |||||||||||||||||||||||
| Basic and diluted | |||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
June 30, 2025 | 7
CVR ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(unaudited)
| Common Stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions, except share data) | Shares Issued | $ Value Common Stock | Additional Paid-In Capital | Accumulated Deficit | Treasury Stock | Total CVR Stockholders’ Equity | Noncontrolling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Distributions from CVR Partners to its public unitholders and IEP | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Distributions from CVR Partners to its public unitholders and IEP | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
| Common Stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in millions, except share data) | Shares Issued | $ Value Common Stock | Additional Paid-In Capital | Accumulated Deficit | Treasury Stock | Total CVR Stockholders’ Equity | Noncontrolling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2023 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends to CVR Energy stockholders | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Distributions from CVR Partners to its public unitholders | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at March 31, 2024 | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dividends to CVR Energy stockholders | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Distributions from CVR Partners to its public unitholders | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
June 30, 2025 | 8
CVR ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
| Six Months Ended June 30, | |||||||||||
| (in millions) | 2025 | 2024 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net (loss) income | $ | ( | $ | ||||||||
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Deferred income taxes and unrecognized tax benefits | ( | ( | |||||||||
| Share-based compensation | |||||||||||
| Unrealized loss (gain) on derivatives, net | ( | ||||||||||
Income from equity method investments | ( | ( | |||||||||
| Return from equity method investment earnings | |||||||||||
| Other items | |||||||||||
| Changes in working capital: | |||||||||||
| Accounts receivables | ( | ||||||||||
| Inventories | ( | ||||||||||
| Income tax receivable | ( | ||||||||||
| Prepaid expenses and other current assets | ( | ||||||||||
| Accounts payable | ( | ( | |||||||||
| Accrued income taxes | ( | ||||||||||
| Deferred revenue | ( | ( | |||||||||
| Other current liabilities | ( | ||||||||||
| Net cash (used in) provided by operating activities | ( | ||||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | ( | ( | |||||||||
| Turnaround expenditures | ( | ( | |||||||||
| Proceeds from sale of assets | |||||||||||
| Insurance proceeds related to asset damages | |||||||||||
| Return of equity method investment | |||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
| Principal payments of long-term debt | ( | ||||||||||
| Principal payments on senior secured notes | ( | ||||||||||
| Dividends to CVR Energy stockholders | ( | ||||||||||
| Distributions to CVR Partners noncontrolling interest holders | ( | ( | |||||||||
| Other financing activities | ( | ( | |||||||||
| Net cash used in financing activities | ( | ( | |||||||||
| Net decrease in cash, cash equivalents | ( | ( | |||||||||
Cash, cash equivalents, reserved funds, and restricted cash, beginning of period (1) | |||||||||||
| Cash and cash equivalents, end of period | $ | $ | |||||||||
(1)As of December 31, 2023, consisted of $581 million of cash and cash equivalents, $598 million of reserved funds, and $7 million of restricted cash. The reserved funds and restricted cash were released in the first quarter of 2024.
The accompanying notes are an integral part of these condensed consolidated financial statements.
June 30, 2025 | 9
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
(1) Organization and Nature of Business
Organization
CVR Energy, Inc. (“CVR Energy”, “CVR”, “we”, “us”, “our”, or the “Company”) is a diversified holding company primarily engaged in the petroleum refining and marketing industry (the “Petroleum Segment”), the renewable fuels industry (the “Renewables Segment”), and the nitrogen fertilizer manufacturing industry through its interest in CVR Partners, LP, a publicly traded limited partnership (the “Nitrogen Fertilizer Segment” or “CVR Partners”). The Petroleum Segment refines and markets high value transportation fuels which consist of gasoline, diesel, jet fuel, and distillates, as well as activities related to crude oil gathering and logistics that support refinery operations. The Renewables Segment refines renewable feedstocks, such as soybean oil, corn oil, and other renewable feedstocks, into renewable diesel and markets renewables products. CVR Partners produces and markets nitrogen fertilizer products primarily in the form of ammonia and urea ammonium nitrate (“UAN”) for the farming industry. CVR’s common stock is listed on the New York Stock Exchange (“NYSE”) under the symbol “CVI”. As of June 30, 2025, Icahn Enterprises L.P. and its affiliates, including Mr. Carl C. Icahn (“IEP”), owned approximately 70 % of the Company’s outstanding common stock.
CVR Partners, LP
As of June 30, 2025, public common unitholders held approximately 60 % of CVR Partners’ outstanding common units; CVR Energy, through its subsidiaries, held approximately 37 % of CVR Partners’ outstanding common units and 100 % of CVR Partners’ general partner interests, while IEP held approximately 3 % of CVR Partners’ outstanding common units. The noncontrolling interest reflected on the Condensed Consolidated Balance Sheets of CVR is only impacted by the results of and distributions from CVR Partners.
Subsequent Events
The Company evaluated subsequent events, if any, that would require an adjustment to the Company’s condensed consolidated financial statements or require disclosure in the notes to the condensed consolidated financial statements through the date of issuance of the condensed consolidated financial statements. Where applicable, the notes to these condensed consolidated financial statements have been updated to reflect all significant subsequent events which have occurred.
On July 4, 2025, the One Big Beautiful Bill Act was signed into law, making significant amendments to federal tax law including permanently extending several provisions of the 2017 Tax Cuts and Jobs Act (“TCJA”). The legislation did not affect the Company’s income tax balances as of June 30, 2025. The Company is currently assessing its impact on future income tax balances and related disclosures and anticipates that it will benefit from the permanent extension of certain TCJA provisions.
(2) Basis of Presentation
The accompanying condensed consolidated financial statements, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), include the accounts of the Company and its majority-owned direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated. Certain notes and other information have been condensed or omitted from the condensed consolidated financial statements. Therefore, these condensed consolidated financial statements should be read in conjunction with the December 31, 2024 audited consolidated financial statements and notes thereto included in CVR Energy’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).
Our condensed consolidated financial statements include the consolidated results of CVR Partners, which is defined as a variable interest entity (“VIE”). As the 100 % owner of the general partner of CVR Partners, the Company has the sole ability to direct the activities that most significantly impact the economic performance of CVR Partners and is considered the primary beneficiary.
In the opinion of the Company’s management, the accompanying condensed consolidated financial statements reflect all adjustments that are necessary for fair presentation of the financial position and results of operations of the Company for the periods presented. Such adjustments are of a normal recurring nature, unless otherwise disclosed.
June 30, 2025 | 10
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
The condensed consolidated financial statements are prepared in conformity with GAAP, which requires management to make certain estimates and assumptions that affect the reported amounts and disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Results of operations and cash flows for the interim periods presented are not necessarily indicative of the results that will be realized for the year ending December 31, 2025 or any other interim or annual period.
Reclassifications
Effective beginning with the 2024 Form 10-K and due to the prominence of the renewables business relative to the Company’s overall 2024 performance, the Company has revised its reportable segments to reflect a new reportable segment: Renewables. The Renewables Segment includes the operations of the renewable diesel unit and renewable feedstock pretreater at the refinery located in Wynnewood, Oklahoma (the “Wynnewood Refinery”). Results of the Renewables Segment were not previously included within our reportable segments, rather included within “Other.” Prior period segment information has been retrospectively adjusted to reflect the current segment presentation. Refer to Note 13 (“Business Segments”) for segment disclosures.
In addition, certain other immaterial reclassifications have been made within the consolidated financial statements for prior periods to conform with current presentation.
Recent Accounting Pronouncements - Accounting Standards Issued But Not Yet Implemented
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures, which requires enhanced income tax disclosures that reflect how operations and related tax risks, as well as how tax planning and operational opportunities, affect the tax rate and prospects for future cash flows. This standard is effective for the Company’s annual reporting beginning January 1, 2025 with early adoption permitted. The adoption of this standard update will not have a material impact on the Company’s consolidated financial statements but additional disclosures will be included for our Annual Report on Form 10-K for the year ending December 31, 2025. The Company does not intend to early adopt this ASU.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which requires additional disclosures in the footnotes that disaggregate certain expenses presented on the face of the income statement. This standard is effective for the Company’s annual reporting period beginning January 1, 2027 and interim reporting periods beginning January 1, 2028. Retrospective application to comparative periods is optional, and early adoption is permitted. The Company continues to evaluate and assess potential impacts of adopting this new accounting guidance.
(3) Inventories
Inventories consisted of the following:
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| Finished goods | $ | $ | |||||||||
| Raw materials | |||||||||||
| In-process inventories | |||||||||||
| Parts, supplies and other | |||||||||||
| Total inventories | $ | $ | |||||||||
At June 30, 2025, the Renewables Segment had inventories with carrying amounts exceeding their net realizable value, which is estimated using indicative market pricing available at the time the estimate was made. As a result, we recognized a loss of $2 million in Cost of materials and other in the Company’s Condensed Consolidated Statements of Operations for the three months ended June 30, 2025 to reflect the net realizable value of such inventories. No
June 30, 2025 | 11
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
(4) Long-Term Assets
Property, Plant, and Equipment
Property, plant, and equipment, net consisted of the following:
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| Machinery and equipment | $ | $ | |||||||||
| Buildings and improvements | |||||||||||
| Land and improvements | |||||||||||
| Furniture and fixtures | |||||||||||
| Construction in progress | |||||||||||
| Other | |||||||||||
| Less: Accumulated depreciation and amortization | ( | ( | |||||||||
| Total property, plant, and equipment, net | $ | $ | |||||||||
For the three and six months ended June 30, 2025, depreciation and amortization expense related to property, plant, and equipment was $59 million and $115 million, respectively, compared to $58 million and $114 million for the three and six months ended June 30, 2024, respectively. For the three and six months ended June 30, 2025, capitalized interest was $2 million and $5 million, respectively, compared to $2 million and $3 million for the three and six months ended June 30, 2024, respectively.
Other Long-Term Assets
As of June 30, 2025 and December 31, 2024, Other long-term assets included turnaround assets, net of accumulated amortization of $289 million and $124 million, respectively.
(5) Leases
Balance Sheet Summary as of June 30, 2025 and December 31, 2024
The following table summarizes the right-of-use (“ROU”) asset and lease liability balances for the Company’s operating and finance leases at June 30, 2025 and December 31, 2024:
| June 30, 2025 | December 31, 2024 | ||||||||||||||||||||||
| (in millions) | Operating Leases | Finance Leases | Operating Leases | Finance Leases | |||||||||||||||||||
| ROU assets, net | |||||||||||||||||||||||
| Equipment, real estate and other | $ | $ | $ | $ | |||||||||||||||||||
| Pipelines and storage | |||||||||||||||||||||||
| Railcars | |||||||||||||||||||||||
| Lease liability | |||||||||||||||||||||||
| Equipment, real estate and other | $ | $ | $ | $ | |||||||||||||||||||
| Pipelines and storage | |||||||||||||||||||||||
| Railcars | |||||||||||||||||||||||
Lease Expense Summary for the Three and Six Months Ended June 30, 2025 and 2024
We recognize short-term and operating lease expense within Direct operating expenses (exclusive of depreciation and amortization) and Cost of materials and other, and finance lease expense within Depreciation and amortization, on a straight-
June 30, 2025 | 12
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
line basis over the lease term. For the three and six months ended June 30, 2025 and 2024, we recognized lease expense comprised of the following components:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Operating lease expense | $ | $ | $ | $ | |||||||||||||||||||
| Finance lease expense: | |||||||||||||||||||||||
| Amortization of ROU asset | |||||||||||||||||||||||
| Interest expense on lease liability | |||||||||||||||||||||||
| Short-term lease expense | |||||||||||||||||||||||
(6) Other Current Liabilities
Other current liabilities were as follows:
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| Accrued Renewable Fuel Standard (“RFS”) obligation | $ | $ | |||||||||
| Accrued taxes other than income taxes | |||||||||||
| Personnel accruals | |||||||||||
| Accrued interest | |||||||||||
| Share-based compensation | |||||||||||
| Current portion of long-term debt and finance lease obligations | |||||||||||
| Deferred revenue | |||||||||||
| Other accrued expenses and liabilities | |||||||||||
| Total other current liabilities | $ | $ | |||||||||
June 30, 2025 | 13
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
(7) Long-Term Debt and Finance Lease Obligations
Long-term debt and finance lease obligations consisted of the following:
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| CVR Energy: | |||||||||||
| $ | $ | ||||||||||
| Unamortized debt issuance costs | ( | ( | |||||||||
| Total CVR Energy debt | |||||||||||
Petroleum Segment: | |||||||||||
| Term loan | |||||||||||
| Unamortized debt discount and debt issuance costs | ( | ( | |||||||||
Total Petroleum Segment finance lease obligations, net of current portion | |||||||||||
Nitrogen Fertilizer Segment: | |||||||||||
| Unamortized debt issuance costs | ( | ( | |||||||||
Total Nitrogen Fertilizer Segment debt and finance lease obligations, net of current portion | |||||||||||
| Total long-term debt and finance lease obligations, net of current portion | |||||||||||
| Current portion of long-term debt and finance lease obligations | |||||||||||
| Total long-term debt and finance lease obligations, including current portion | $ | $ | |||||||||
Credit Agreements
| (in millions) | Total Available Borrowing Capacity | Amount Borrowed as of June 30, 2025 | Outstanding Letters of Credit | Available Capacity as of June 30, 2025 | Maturity Date | ||||||||||||||||||||||||
Petroleum Segment | |||||||||||||||||||||||||||||
| CVR Energy’s Amended and Restated ABL Credit Agreement (“CVR Energy ABL”) | $ | $ | $ | $ | June 30, 2027 | ||||||||||||||||||||||||
Nitrogen Fertilizer Segment: | |||||||||||||||||||||||||||||
CVR Partners’ Credit Agreement (“CVR Partners ABL”) | $ | $ | $ | $ | September 26, 2028 | ||||||||||||||||||||||||
Petroleum Segment
Term Loan - On June 30, 2025, certain of the Company’s subsidiaries (the “Term Loan Borrowers”) prepaid $70 million in principal of the senior secured term loan facility (the “Term Loan”), in addition to required principal and interest payments as set forth in the Term Loan. As a result of this transaction, the Company recognized in Interest expense, net a loss on extinguishment of debt of approximately $1 million in the second quarter of 2025, related to the write-off of unamortized discount and deferred financing costs. Further, on July 25, 2025, the Term Loan Borrowers prepaid an additional $20 million in principal of the Term Loan, plus any accrued and unpaid interest to the redemption date.
June 30, 2025 | 14
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
Covenant Compliance
The Company and its subsidiaries were in compliance with all covenants under their respective debt instruments as of June 30, 2025.
(8) Revenue
The following table presents the Company’s revenue disaggregated by major product, which include a reconciliation of the disaggregated revenue by the Company’s reportable segments:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
Petroleum Segment: | |||||||||||||||||||||||
| Gasoline | $ | $ | $ | $ | |||||||||||||||||||
Distillates (1) | |||||||||||||||||||||||
| Crude oil sales | |||||||||||||||||||||||
| Other revenue | |||||||||||||||||||||||
Total Petroleum Segment revenue | |||||||||||||||||||||||
Renewables Segment: | |||||||||||||||||||||||
| Renewable diesel | |||||||||||||||||||||||
| Renewable fuel credits | |||||||||||||||||||||||
Total Renewables Segment revenue | |||||||||||||||||||||||
Nitrogen Fertilizer Segment: | |||||||||||||||||||||||
| Ammonia | |||||||||||||||||||||||
| UAN | |||||||||||||||||||||||
| Urea Products | |||||||||||||||||||||||
| Other revenue | |||||||||||||||||||||||
Total Nitrogen Fertilizer Segment revenue | |||||||||||||||||||||||
| Total revenue | $ | $ | $ | $ | |||||||||||||||||||
(1)Distillates consist primarily of diesel fuel, kerosene, and jet fuel.
Remaining Performance Obligations
The Company has spot and term contracts with customers and the transaction prices are either fixed or based on market indices (variable consideration). The Company does not disclose remaining performance obligations for contracts that have terms of one year or less and for contracts where the variable consideration was entirely allocated to an unsatisfied performance obligation. As of June 30, 2025, these contracts have a remaining duration of less than one year .
As of June 30, 2025, the Nitrogen Fertilizer Segment had approximately $6 million of remaining performance obligations for contracts with an original expected duration of more than one year. The Nitrogen Fertilizer Segment expects to recognize $3 million of these performance obligations as revenue by the end of 2025, $3 million during 2026, and the remaining balance in 2027.
June 30, 2025 | 15
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
Contract Balances
The following table provides the balance sheet location and amounts of deferred revenue from contracts with customers for the Nitrogen Fertilizer Segment:
| Contract Balance Type | Balance Sheet Location | June 30, 2025 | December 31, 2024 | |||||||||||||||||
| Deferred revenue | Other current liabilities | $ | $ | |||||||||||||||||
| Long-term deferred revenue | Other long-term liabilities | |||||||||||||||||||
During the six months ended June 30, 2025 and 2024, the Company recognized revenue of $47 million and $13 million, respectively, that was included in the deferred revenue balances as of December 31, 2024 and December 31, 2023, respectively.
(9) Derivative Financial Instruments
The following outlines the net notional buy (sell) position of our commodity derivative instruments held as of June 30, 2025 and December 31, 2024:
| (in thousands of barrels) | Commodity | June 30, 2025 | December 31, 2024 | ||||||||||||||
| Forwards | Crude | ( | |||||||||||||||
| Swaps | NYMEX Diesel Cracks (1) | ( | ( | ||||||||||||||
| Futures | ULSD | ( | ( | ||||||||||||||
| Futures | Soybean | ( | |||||||||||||||
(1)As of June 30, 2025, the Company held offsetting NYMEX Diesel Crack commodity buy and sell positions of approximately 2.6 million barrels.
The following outlines the balances of our commodity derivative instruments after the effects of contract netting and allocation of collateral and their classifications on our Condensed Consolidated Balance Sheets. Refer to Note 10 (“Fair Value Measurements”) for the gross amounts of the commodity derivative instruments (before the effects of contract netting and allocation of collateral):
| June 30, 2025 | December 31, 2024 | ||||||||||||||||||||||
| (in millions) | Assets | Liabilities | Assets | Liabilities | |||||||||||||||||||
Other current assets | $ | $ | $ | $ | |||||||||||||||||||
The following table represents CVR Energy’s incurred realized and unrealized net gains from derivative activities, recorded in Cost of materials and other on the Condensed Consolidated Statements of Operations:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Commodity derivative instruments | $ | $ | $ | $ | |||||||||||||||||||
CVR Energy has certain derivative instruments that contain credit risk-related contingent provisions associated with our credit ratings. If our credit rating were to be downgraded, it would allow the counterparty to require us to post collateral or to request immediate, full settlement of derivative instruments in liability positions. As of June 30, 2025, there were no derivative liabilities with credit risk-related contingent provisions.
(10) Fair Value Measurements
Assets and liabilities measured at fair value on a recurring basis
The following tables set forth information about the assets and liabilities measured at fair value on a recurring basis, by input level, as of June 30, 2025 and December 31, 2024. Such amounts are presented on a gross basis, before the effects of netting and allocation of collateral. The Company elected to offset the fair value amounts recognized for derivative assets and
June 30, 2025 | 16
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
liabilities executed with the same counterparty under a master netting arrangement, including fair value amounts recognized for the right to reclaim or the obligation to return cash collateral.
| June 30, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Fair Value Hierarchy | Total gross fair value | Contract netting | Collateral netting (1) | Net value | |||||||||||||||||||||||||||||||||||||
| (in millions) | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||||||||
| Commodity derivative instruments | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||||||||
| Commodity derivative instruments | ( | ||||||||||||||||||||||||||||||||||||||||
| RFS | |||||||||||||||||||||||||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||||||||||||||||||||
| Fair Value Hierarchy | Total gross fair value | Contract netting | Collateral netting (1) | Net value | |||||||||||||||||||||||||||||||||||||
| (in millions) | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||||||||||||
| Assets | |||||||||||||||||||||||||||||||||||||||||
| Commodity derivative instruments | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||||||||
| Commodity derivative instruments | ( | ||||||||||||||||||||||||||||||||||||||||
| RFS | |||||||||||||||||||||||||||||||||||||||||
(1)At June 30, 2025 and December 31, 2024, the Company had $6 million and $3 million of collateral under master netting arrangements not offset against the derivatives within Other current assets on the Condensed Consolidated Balance Sheets, respectively, primarily related to initial margin requirements.
The Company’s commodity derivative contracts consist of exchange traded futures, commodity price swaps, and sale and purchase forwards that are measured at fair value using a market approach based on available broker quoted market prices of identical or similar instruments. Similarly, RFS obligations are measured at fair value using a market approach based on available broker quoted market renewable fuel credits, known as renewable identification numbers (“RINs”), spot prices for each specific or closest vintage year.
The Company had no transfers of assets or liabilities between any of the above levels during the six months ended June 30, 2025 and year ended December 31, 2024.
Assets and liabilities not required to be measured at fair value
CVR Energy holds cash equivalents which consist primarily of bank time deposits with maturities of 90 days or less. Cash and cash equivalents and reserved funds had carrying and fair values of $596 987
Long-term debt of $1.8 billion and $1.9 billion at June 30, 2025 and December 31, 2024, respectively, had estimated fair values of $1.5 billion and $1.5 billion, respectively, and are classified as Level 2 in the fair value hierarchy.
Other short-term financial assets and liabilities, which consist of restricted cash, accounts receivable, accounts payable, and operating and finance lease obligations, are carried at cost on the Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 and approximate their estimated fair values.
June 30, 2025 | 17
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
(11) Share-Based Compensation
A summary of compensation expense during the three and six months ended June 30, 2025 and 2024 is presented below:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| CVR Partners - Phantom Unit Awards | $ | $ | $ | $ | |||||||||||||||||||
| Incentive Unit Awards | |||||||||||||||||||||||
| Total share-based compensation expense | $ | $ | $ | $ | |||||||||||||||||||
(12) Commitments and Contingencies
In the ordinary course of business, the Company may become party to lawsuits, administrative proceedings, and governmental investigations, including environmental, regulatory, and other matters. The outcome of these matters cannot always be predicted accurately, but the Company accrues liabilities for these matters if the Company has determined that it is probable a loss has been incurred and the loss can be reasonably estimated. While there have been no material changes in the Company’s commitments and contingencies from those disclosed in the 2024 Form 10-K, recent developments are discussed below.
Crude Oil Supply Agreement
The Petroleum Segment has a crude oil supply agreement with Gunvor USA LLC (“Gunvor”), which commenced on January 1, 2024 (as amended, the “Gunvor Crude Oil Supply Agreement”), pursuant to which Gunvor supplies the Petroleum Segment with certain crude oil and intermediation logistics helping to reduce the amount of inventory held at certain locations and mitigate crude oil pricing risk. Volumes contracted under this agreement, as a percentage of the total crude oil purchases (in barrels), were approximately 13 % and 20 % for the three months ended June 30, 2025 and 2024, respectively, and 9 % and 21 % for the six months ended June 30, 2025 and 2024, respectively. On July 29, 2025, the Gunvor Crude Oil Supply Agreement was amended to update certain commercial terms and extend its term through January 31, 2029, which is subject to two successive automatic one-year renewals following the expiration of the amended term in the absence of 180 days’ notice of termination.
45Q Transaction
Under the agreements entered into in connection with the 45Q Transaction, the Company’s indirect subsidiary, Coffeyville Resources Nitrogen Fertilizer, LLC (“CRNF”), is obligated to meet certain minimum quantities of carbon oxide supply each year during the term of the agreement and is subject to fees of up to $15 million per year (reduced pro rata for partial years) to the unaffiliated third-party investors, subject to an overall $45 million cap, if these minimum quantities are not delivered. CVR Partners issued a guarantee to the unaffiliated third-party investors and certain of their affiliates involved in the 45Q Transaction of the payment and performance obligations of CRNF and CVR-CapturePoint Parent, LLC (“CVRP JV”), which include the aforementioned fees. This guarantee has no impacts on the accounting records of CVR Partners unless the parties fail to comply with the terms of the 45Q Transaction contracts.
Renewable Fuel Standard
Coffeyville Resources Refining & Marketing, LLC (“CRRM”) and Wynnewood Refining Company, LLC (“WRC”, and together with CRRM, the “obligated-party subsidiaries”) are subject to the RFS implemented by the U.S. Environmental Protection Agency (the “EPA”), which, absent any exemption or waiver, requires obligated parties to blend a certain amount of renewable fuels, called a Renewable Volume Obligation (“RVO”), into their transportation fuels or purchase RINs, in lieu of blending. The Petroleum Segment’s obligated-party subsidiaries are not able to blend the majority of their transportation fuels with renewable fuels and, unless their RFS obligations are waived or exempted, must either purchase RINs from third parties including its affiliate or obtain waiver credits for cellulosic biofuels in order to comply with the RFS.
The Company’s obligated-party subsidiaries recognized, net of RIN sales, an expense of $123 million and an expense of $30 million for the three months ended June 30, 2025 and 2024, respectively, and an expense of $246 million and a benefit of $21 million for the six months ended June 30, 2025 and 2024, respectively, for their compliance with the RFS (based on the 2020 through 2025 renewable volume obligation (“RVO”), for the respective periods, excluding the impacts of any exemptions
or waivers to which the Company’s obligated-party subsidiaries may be entitled). The costs to comply with the RFS obligation through purchasing of RINs not otherwise reduced by blending of ethanol, biodiesel, or renewable diesel are included within Cost of materials and other in the Condensed Consolidated Statements of Operations. At each reporting period, to the extent RINs purchased and generated through blending are less than the RFS obligation (excluding the impact of exemptions or waivers to which the Company may be entitled), the remaining position is valued using RIN market prices at period end for each specific or closest vintage year. As of June 30, 2025 and December 31, 2024, the Company’s obligated-party subsidiaries’ RFS positions were approximately $548 million and $323 million, respectively, and are recorded in Other current liabilities in the Condensed Consolidated Balance Sheets.
Litigation
Renewable Fuel Standard – In June 2025, the Supreme Court of the United States (“SCOTUS”) held that venue for the challenges filed by WRC and other small refineries to the EPA’s denials (the “2022 Denials”) of certain petitions for small refinery hardship exemptions under the RFS lies exclusively in the United States Court of Appeals for the D.C. Circuit (“D.C. Circuit”). This ruling vacated the November 2023 opinion of the United States Court of Appeals for the Fifth Circuit that had vacated the 2022 Denials as to WRC and its co-petitioners and remanded for further proceedings. We expect WRC’s and its co-petitioners’ challenges will be transferred to the D.C. Circuit. Upon transfer, we expect that the EPA’s denials of these petitions will once again be vacated in accordance with the July 2024 decision of the D.C. Circuit, in which that court (like the Fifth Circuit) vacated and remanded the 2022 Denials to the EPA, finding them to be contrary to law and arbitrary and capricious. We similarly expect that WRC’s and its co-petitioners’ challenges to the EPA’s separate 2023 denials (the “2023 Denials”) of additional petitions for small refinery hardship exemptions will be vacated consistent with the D.C. Circuit’s July 2024 decision, because the 2023 Denials were based on the same methodology as the 2022 Denials. WRC also filed a challenge in the Fifth Circuit to the EPA’s denial of a single exemption petition in early January 2025. This case currently is held in abeyance to allow the EPA to brief the current administration about the case and determine whether to revise the underlying denial of WRC’s exemption petition.
Also in June 2025, the D.C. Circuit issued a decision remanding the EPA’s renewable volume obligations for 2023 to 2025 (“Set Rule”) to the EPA without vacatur based on specific grounds raised by environmental petitioners, while rejecting all other challenges, including those raised by refiners. Additionally, the EPA issued its proposed renewable volume obligations for 2026 and 2027 (“Set 2 Rule”). Public comment on the proposal is due in August 2025. In July 2025, the EPA’s partial waiver of the 2024 cellulosic biofuel volume requirement was published in the Federal Register, making the 2024 RFS compliance reporting deadline for all obligated parties December 1, 2025. Also in July 2025, WRC submitted its petition for the 2025 compliance period, ruling on which is due in October 2025.
As these matters are in various stages, the Company cannot yet determine at this time the outcomes of these matters. While we intend to prosecute these actions vigorously, if these matters are ultimately concluded in a manner adverse to WRC, they could have a material effect on the Company’s financial position, results of operations, or cash flows.
Guaranty Dispute – In May 2025, a subsidiary of CVR Energy entered into a stipulation with Exxon Mobil Corporation (“XOM”) in connection with the lawsuit it filed in the Superior Court of the State of Delaware disputing the validity of an alleged guaranty claimed by XOM to have been issued in its favor in 1993 extending all deadlines under the litigation until late July 2025. As this matter remains in its early stages, the Company cannot yet determine whether its outcome will have a material adverse impact on the Company’s financial position, results of operations, or cash flows.
(13) Business Segments
CVR Energy’s revenues are primarily derived from the three reportable segments: Petroleum, Renewables, and Nitrogen Fertilizer, which were determined based on the management approach, reflecting the internal reporting used by the Chief Operating Decision Maker (“CODM”), the Company’s Chief Executive Officer, to evaluate performance and make strategic decisions.
•Petroleum includes the refining and marketing of high value transportation fuels which consist of gasoline, diesel, jet fuel, and distillates. The Petroleum Segment also includes activities related to crude gathering and logistics that support the refinery operations.
•Renewables includes the refining of renewable feedstocks, such as soybean oil, corn oil, and other renewable feedstocks, into renewable diesel and marketing of renewables products.
June 30, 2025 | 18
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
•Nitrogen Fertilizer includes the production and sales of nitrogen fertilizer products, primarily in the form of ammonia and UAN, for the farming industry.
The CODM evaluates the performance of each reportable segment and decides how to allocate resources, as applicable, based on segment operating income (loss) which includes the revenue and expenses that are directly attributable to each segment, as well as the total assets per segment. The CODM uses operating income (loss) and total assets by segment to assess the results generated by each reportable segment and to decide, as applicable, whether to recommend that the Board reinvest profits into the reportable segments, if at all, or pay dividends. Operating income (loss) by segment is also used to analyze performance against the budget and the Company’s competitors.
The other amounts reflect intercompany transactions, corporate cash and cash equivalents, income tax activities, and other corporate activities that are not allocated or aggregated to the reportable segments.
The following tables present the operating results and capital expenditures information by segment, the reconciliations to the consolidated net profit (loss), and other required disclosures:
| Three Months Ended June 30, 2025 | |||||||||||||||||||||||||||||
| (in millions) | Petroleum Segment | Renewables Segment | Nitrogen Fertilizer Segment | Other / Eliminations | Consolidated | ||||||||||||||||||||||||
| Third-party sales | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Inter-segment fees and sales | ( | — | |||||||||||||||||||||||||||
| Net sales | ( | ||||||||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||
| Cost of materials and other | ( | ||||||||||||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Selling, general and administrative expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||||||||
| (Gain) loss on asset disposals | ( | ( | |||||||||||||||||||||||||||
| Operating (loss) income | $ | ( | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||||||
| Reconciliation of Operating (loss) income to Net loss: | |||||||||||||||||||||||||||||
| Interest expense, net | $ | ( | |||||||||||||||||||||||||||
| Other income, net | |||||||||||||||||||||||||||||
| Income tax benefit | |||||||||||||||||||||||||||||
| Net loss | $ | ( | |||||||||||||||||||||||||||
| Other segment disclosures: | |||||||||||||||||||||||||||||
| Interest income | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||||||||
Capital expenditures (1) | |||||||||||||||||||||||||||||
June 30, 2025 | 19
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
| Three Months Ended June 30, 2024 | |||||||||||||||||||||||||||||
| (in millions) | Petroleum Segment | Renewables Segment | Nitrogen Fertilizer Segment | Other / Eliminations | Consolidated | ||||||||||||||||||||||||
| Third-party sales | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Inter-segment fees and sales | ( | — | |||||||||||||||||||||||||||
| Net sales | ( | ||||||||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||
| Cost of materials and other | ( | ||||||||||||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Selling, general and administrative expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||||||||
| Loss on asset disposals | |||||||||||||||||||||||||||||
| Operating income (loss) | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
| Reconciliation of Operating income (loss) to Net income: | |||||||||||||||||||||||||||||
| Interest expense, net | $ | ( | |||||||||||||||||||||||||||
| Other income, net | |||||||||||||||||||||||||||||
| Income tax benefit | |||||||||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||||||||
| Other segment disclosures: | |||||||||||||||||||||||||||||
| Interest income | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ||||||||||||||||||||||||||
Capital expenditures (1) | |||||||||||||||||||||||||||||
June 30, 2025 | 20
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
| Six Months Ended June 30, 2025 | |||||||||||||||||||||||||||||
| (in millions) | Petroleum Segment | Renewables Segment | Nitrogen Fertilizer Segment | Other / Eliminations | Consolidated | ||||||||||||||||||||||||
| Third-party sales | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Inter-segment fees and sales | ( | — | |||||||||||||||||||||||||||
| Net sales | ( | ||||||||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||
| Cost of materials and other | ( | ||||||||||||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Selling, general and administrative expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||||||||
| Loss on asset disposals | |||||||||||||||||||||||||||||
| Operating (loss) income | $ | ( | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||||||
| Reconciliation of Operating (loss) income to Net loss: | |||||||||||||||||||||||||||||
| Interest expense, net | $ | ( | |||||||||||||||||||||||||||
| Other income, net | |||||||||||||||||||||||||||||
| Income tax benefit | |||||||||||||||||||||||||||||
| Net loss | $ | ( | |||||||||||||||||||||||||||
| Other segment disclosures: | |||||||||||||||||||||||||||||
| Interest income | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||||||||
Capital expenditures (1) | |||||||||||||||||||||||||||||
June 30, 2025 | 21
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
| Six Months Ended June 30, 2024 | |||||||||||||||||||||||||||||
| (in millions) | Petroleum Segment | Renewables Segment | Nitrogen Fertilizer Segment | Other / Eliminations | Consolidated | ||||||||||||||||||||||||
| Third-party sales | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Inter-segment fees and sales | ( | — | |||||||||||||||||||||||||||
| Net sales | ( | ||||||||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||
| Cost of materials and other | ( | ||||||||||||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Selling, general and administrative expenses (exclusive of depreciation and amortization) | |||||||||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||||||||
| Loss on asset disposals | |||||||||||||||||||||||||||||
| Operating income (loss) | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||
| Reconciliation of Operating income (loss) to Net income: | |||||||||||||||||||||||||||||
| Interest expense, net | $ | ( | |||||||||||||||||||||||||||
| Other income, net | |||||||||||||||||||||||||||||
| Income tax benefit | |||||||||||||||||||||||||||||
| Net income | $ | ||||||||||||||||||||||||||||
| Other segment disclosures: | |||||||||||||||||||||||||||||
| Interest income | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||||||||
Capital expenditures (1) | |||||||||||||||||||||||||||||
The following table summarizes the reconciliation of total assets by segment to consolidated total assets:
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| Petroleum | $ | $ | |||||||||
| Renewables | |||||||||||
| Nitrogen Fertilizer | |||||||||||
| Other, including inter-segment eliminations | ( | ( | |||||||||
| Total assets | $ | $ | |||||||||
(1)Capital expenditures are shown exclusive of capitalized turnaround expenditures.
June 30, 2025 | 22
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
(14) Supplemental Cash Flow Information
Cash flows related to income taxes, interest, leases, and capital and turnaround expenditures included in accounts payable were as follows:
| Six Months Ended June 30, | |||||||||||
| (in millions) | 2025 | 2024 | |||||||||
| Supplemental disclosures: | |||||||||||
| Cash (received, net of payments) paid, net of refunds for income taxes | $ | ( | $ | ||||||||
| Cash paid for interest | |||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
| Operating cash flows from operating leases | |||||||||||
| Operating cash flows from finance leases | |||||||||||
| Financing cash flows from finance leases | |||||||||||
| Noncash investing and financing activities: | |||||||||||
Change in capital expenditures included in accounts payable (1) | |||||||||||
| Change in turnaround expenditures included in accounts payable | ( | ( | |||||||||
| ROU assets obtained in exchange for new or modified operating lease liabilities | |||||||||||
| ROU assets obtained in exchange for new or modified finance lease liabilities | |||||||||||
(1)Capital expenditures are shown exclusive of capitalized turnaround expenditures.
(15) Related Party Transactions
Activity associated with the Company’s related party arrangements for the three and six months ended June 30, 2025 and 2024 is summarized below:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Sales to related parties: | |||||||||||||||||||||||
CVRP JV CO Contract (1) | $ | $ | $ | $ | |||||||||||||||||||
| Purchases from related parties: | |||||||||||||||||||||||
| Enable Joint Venture Transportation Agreement | |||||||||||||||||||||||
Midway Joint Venture Agreement (2) | |||||||||||||||||||||||
| Payments: | |||||||||||||||||||||||
Dividends (3) | |||||||||||||||||||||||
(1)Sales to related parties, included in Net sales in our Condensed Consolidated Statements of Operations, consists of CO sales to a CVRP JV subsidiary.
(2)Purchases from related parties, included in Cost of materials and other in our Condensed Consolidated Statements of Operations, represent reimbursements for crude oil transportation services incurred on the crude oil pipeline connecting the refinery in Coffeyville, Kansas and the Cushing, Oklahoma oil hub (the “Midway Pipeline”) through Gunvor as the intermediary purchasing agent. On December 23, 2024, the Company sold the 50 % limited liability company interest it owned in the Midway Pipeline.
(3)See below for a summary of the dividends paid to IEP during the six months ended June 30, 2025 and year ended December 31, 2024.
Dividends to CVR Energy Stockholders
Dividends, if any, including the payment, amount and timing thereof, are determined at the discretion of the board of directors of the Company (the “Board”). IEP, through its ownership of the Company’s common stock, is entitled to receive dividends that are declared and paid by the Company based on the number of shares held at each record date. The following
June 30, 2025 | 23
CVR ENERGY, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
table presents quarterly dividends paid to the Company’s stockholders, including IEP, during 2024 (amounts presented in the table below may not add to totals presented due to rounding):
Quarterly Dividends Paid (in millions) | ||||||||||||||||||||||||||||||||
| Related Period | Date Paid | Quarterly Dividends Per Share | Public Stockholders | IEP | Total | |||||||||||||||||||||||||||
2023 - 4th Quarter | March 11, 2024 | $ | $ | $ | $ | |||||||||||||||||||||||||||
2024 - 1st Quarter | May 20, 2024 | |||||||||||||||||||||||||||||||
2024 - 2nd Quarter | August 19, 2024 | |||||||||||||||||||||||||||||||
Total 2024 quarterly dividends | $ | $ | $ | $ | ||||||||||||||||||||||||||||
There were no quarterly dividends declared or paid during the fourth quarter of 2024, first quarter of 2025, or second quarter of 2025 related to the third and fourth quarter of 2024 and first quarter of 2025, respectively. There were no quarterly dividends declared for the second quarter of 2025.
Distributions to CVR Partners’ Unitholders
Distributions, if any, including the payment, amount and timing thereof, and the board of directors of CVR Partners’ general partner’s (the “UAN GP Board”) distribution policy, including the definition of available cash, are subject to change at the discretion of the UAN GP Board. The following tables present quarterly distributions paid by CVR Partners to CVR Partners’ unitholders, including amounts received by the Company and IEP, during 2025 and 2024 (amounts presented in the tables below may not add to totals presented due to rounding):
| Quarterly Distributions Per Common Unit | Quarterly Distributions Paid (in millions) | |||||||||||||||||||||||||||||||||||||
| Related Period | Date Paid | Public Unitholders | IEP | CVR Energy | Total | |||||||||||||||||||||||||||||||||
| 2024 - 4th Quarter | March 10, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| 2025 - 1st Quarter | May 19, 2025 | |||||||||||||||||||||||||||||||||||||
Total 2025 quarterly distributions | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
2023 - 4th Quarter | March 11, 2024 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
2024 - 1st Quarter | May 20, 2024 | |||||||||||||||||||||||||||||||||||||
2024 - 2nd Quarter | August 19, 2024 | |||||||||||||||||||||||||||||||||||||
2024 - 3rd Quarter | November 18, 2024 | |||||||||||||||||||||||||||||||||||||
Total 2024 quarterly distributions | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
For the second quarter of 2025, CVR Partners, upon approval by the UAN GP Board on July 30, 2025, declared a distribution of $3.89 per common unit, or approximately $41 million, which is payable August 18, 2025 to unitholders of record as of August 11, 2025. Of this amount, CVR Energy and IEP will receive approximately $15 million and $1 million, respectively, with the remaining amount payable to public unitholders.
June 30, 2025 | 24
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition, results of operations, and cash flows should be read in conjunction with our unaudited condensed consolidated financial statements and related notes and with the statistical information and financial data included elsewhere in this Report, as well as our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 19, 2025 (the “2024 Form 10-K”). Results of operations for the three and six months ended June 30, 2025 and cash flows for the six months ended June 30, 2025 are not necessarily indicative of results to be attained for any other period. See “Important Information Regarding Forward-Looking Statements.” References to “CVR Energy”, the “Company”, “we”, “us”, and “our”, may refer to consolidated subsidiaries of CVR Energy, including CVR Refining, LP or CVR Partners, LP, as the context may require.
Reflected in this discussion and analysis is how management views the Company’s current financial condition and results of operations, along with key external variables and management’s actions that may impact the Company. This discussion may contain forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this Report.
Company Overview
CVR Energy is a diversified holding company primarily engaged in the petroleum refining and marketing industry (the “Petroleum Segment”), the renewable fuels industry (the “Renewables Segment”), and the nitrogen fertilizer manufacturing industry through its interest in CVR Partners, LP, a publicly traded limited partnership (the “Nitrogen Fertilizer Segment” or “CVR Partners”). The Petroleum Segment is an “independent petroleum refiner”, in that it does not have crude oil exploration or production operations and is a marketer of high value transportation fuels primarily in the form of gasoline and diesel fuels. The Renewables Segment refines feedstocks, including soybean oil, corn oil, and other related renewable feedstocks, into renewable diesel. CVR Partners produces and markets nitrogen fertilizers primarily in the form of urea ammonium nitrate (“UAN”) and ammonia.
We operate under three reportable segments: petroleum, renewables, and nitrogen fertilizer, which are referred to in this document as our “Petroleum Segment”, our “Renewables Segment”, and our “Nitrogen Fertilizer Segment”, respectively.
Strategy and Goals
The Company has adopted Mission and Core Values, which articulate the Company’s expectations for how it and its employees do business each and every day.
Mission and Core Values
Our Mission is to be a top tier North American renewable fuels, petroleum refining, and nitrogen-based fertilizer company as measured by safe and reliable operations, superior performance and profitable growth. The foundation of how we operate is built on five core Values:
•Safety - We always put safety first. The protection of our employees, contractors and communities is paramount. We have an unwavering commitment to safety above all else. If it’s not safe, then we don’t do it.
•Environment - We care for our environment. Complying with all regulations and minimizing any environmental impact from our operations is essential. We understand our obligation to the environment and that it’s our duty to protect it.
•Integrity - We require high business ethics. We comply with the law and practice sound corporate governance. We only conduct business one way—the right way with integrity.
•Corporate Citizenship - We are proud members of the communities where we operate. We are good neighbors and know that it’s a privilege we can’t take for granted. We seek to make a positive economic and social impact through our financial donations and the contributions of time, knowledge and talent of our employees to the places where we live and work.
June 30, 2025 | 25
•Continuous Improvement - We believe in both individual and team success. We foster accountability under a performance-driven culture that supports creative thinking, teamwork, diversity and personal development so that employees can realize their maximum potential. We use defined work practices for consistency, efficiency and to create value across the organization.
Our core Values are driven by our people, inform the way we do business each and every day and enhance our ability to accomplish our mission and related strategic objectives.
Strategic Objectives
We have outlined the following strategic objectives to drive the accomplishment of our mission:
•Environmental, Health & Safety (“EH&S”) - We aim to achieve continuous improvement in all EH&S areas through ensuring our people’s commitment to environmental, health and safety comes first, the refinement of existing policies, continuous training, and enhanced monitoring procedures.
•Reliability - Our goal is to achieve industry-leading utilization rates at our facilities through safe and reliable operations. We are focusing on improvements in day-to-day plant operations, identifying alternative sources for plant inputs to reduce lost time due to third-party operational constraints, and optimizing our commercial and marketing functions to maintain plant operations at their highest level.
•Market Capture - We continuously evaluate opportunities to improve the facilities’ realized pricing at the gate and reduce variable costs incurred in production to maximize our capture of market opportunities.
•Financial Discipline - We strive to be as efficient as possible by maintaining low operating costs and disciplined deployment of capital.
Industry Factors and Market Indicators
General Business Environment
Geopolitical Matters - Ongoing and recently proposed changes to the U.S. global trade policy, along with actual and potential international retaliatory measures, have continued to cause volatility in global markets and uncertainty around short- and long-term economic impacts in the U.S. and around the globe, including concerns over inflation, recession, and slowing growth. In addition, the ongoing Russia-Ukraine war and Middle East conflicts and tensions continue to present significant geopolitical risks to global markets, with direct implications for the global oil, fertilizer, agriculture, and other industries. These concerns could lead to further oil price and inventory volatility, and disruptions in the production and trade of fertilizer, grains, and feedstock through various means, such as trade restrictions and sanctions. The ultimate impacts of these conflicts and/or economic policy changes, or further escalation or expansion thereof, and any associated market disruptions are difficult to predict and may affect our business, operations, cash flows, and access to capital in unforeseen ways.
Regulatory Environment - In addition to existing regulations like the Renewable Fuel Standard (“RFS”) of the Clean Air Act, which significantly impacts our business, there have been several proposed and enacted climate-related rules and compliance requirements at federal, state, and international levels. While the Biden Administration had advanced significant climate-related initiatives, including stricter Environmental Protection Agency (“EPA”) motor vehicle emissions standards and the SEC’s proposed climate risk disclosure rule, recent changes following the 2024 U.S. presidential election have begun to shift regulatory priorities. Under the new Administration, a combination of executive orders, regulatory rollbacks and new legislation have curtailed, delayed or restructured some of these initiatives, including the promotion of incentives to increase fossil fuel production. Climate-related reporting requirements at the state level also remain under discussion, further contributing to a more uncertain regulatory landscape which may materially impact our business, operations, feedstock and compliance costs, results of operations and overall market stability.
Petroleum Segment
The earnings and cash flows of the Petroleum Segment are primarily affected by the relationship between refined product prices and the prices for crude oil and other feedstocks that are processed and blended into refined products together with the cost of refinery compliance, including the cost of compliance with RFS regulations. The cost to acquire crude oil and other
June 30, 2025 | 26
feedstocks and the price for which refined products are ultimately sold depends on factors beyond the Petroleum Segment’s control, including the supply of and demand for crude oil, as well as gasoline, distillate, and other refined products which, in turn, depend on, among other factors, changes in domestic and foreign economies and trade policies, driving habits, weather conditions, domestic and foreign political affairs, production levels, the availability or permissibly of imports and exports, the marketing of competitive fuels, the extent of government regulations, and the outcome of legal or regulatory proceedings. Because the Petroleum Segment applies first-in, first-out (“FIFO”) accounting to value its inventory, crude oil and refined product price movements may impact margin as a result of changes in the value of its unhedged inventory. The effect of changes in crude oil prices on the Petroleum Segment’s results of operations is also influenced by the rate at which the processing of refined products adjusts to reflect these changes.
The prices of crude oil and other feedstocks and refined products are also affected by other factors, such as product pipeline capacity, system inventory, local and regional market conditions, inflation, and the operating levels of other refineries. Crude oil costs and the prices of refined products have historically been subject to wide fluctuations. Widespread expansion or upgrades of third-party facilities, shutdowns or curtailments, price volatility, international political and economic developments, and other factors are likely to continue to play an important role in refining industry economics. These factors can impact, among other things, the level of inventories in the market, resulting in price volatility and a reduction in product margins. Moreover, the refining industry typically experiences seasonal fluctuations in demand for refined products, such as increases in the demand for gasoline during the summer driving season and for volatile seasonal exports of diesel from the United States Gulf Coast. Specific factors impacting the Company’s operations are outlined below:
Current Market Outlook
•We characterize current crack spreads as at or near mid-cycle levels. This is due to a combination of the refined products market being oversupplied, as refinery utilization has been above the 5-year history for most of 2025, improved fleet mileage, and reduced manufacturing activity which has led to steady gas and diesel demand. However, diesel inventories remain low globally, nationally, and in Group 3. Diesel crack spreads have been elevated so far in 2025 and sustained economic growth could strengthen them further.
•Shale oil production continues to increase in certain shale oil basins, albeit at a slower pace than in prior years, including in the Anadarko Basin. Crude oil exports in the United States have sustained a 4 million bpd rate for most of the year, although recent exports have been reduced, and we believe the Petroleum Segment benefits from these exports through the Brent crude oil differential to WTI, as should all refineries in PADD II.
•OPEC has announced production quota increases for the second and third quarters of 2025, some of which have been implemented. The most recent announcement was a 548,000 bpd increase for August 2025. Such increased supply could further depress crude oil and refined product prices.
•Total operable refining capacity in the United States has declined by approximately 900,000 bpd on a net basis, since 2020, with the reduction of approximately 1.5 million bpd of refined product capacity offset by the addition of approximately 600,000 bpd of capacity from the completion of expansion projects at existing domestic refineries over the past few years. Globally, several new refineries have been completed in the Middle East, Asia, Mexico and Africa, although these capacity additions have been offset somewhat by additional refinery closures, and should be further impacted by nearly 1 million bpd of announced additional capacity closures in the United States and Europe expected by the end of 2025. Over the next few years, the pace of global capacity growth is expected to slow with few new refineries scheduled to come online, which could lead to a tightening in global refined product supply and demand balances as global demand growth is expected to continue increasing.
•Eight Midwestern states opted out of the one-pound per square inch Reid vapor pressure (“RVP”) volatility waiver for E10 blends in gasoline for the summer months, from May 1 through September 15, 2025, which is expected to bifurcate gasoline markets, requiring a more restrictive (lower RVP) gasoline blendstock in those states, and could require the sale of multiple gasoline grades while concurrently straining logistics capabilities for pipeline, refinery and/or terminal tankage. In late April 2025, the current administration issued a one-pound RVP waiver for E10 which effectively eliminated the supply effects of opted out states. While the waivers may only be effective for a period of 20 calendar days or less, we think it is likely the waivers will continue to be issued due to inventory conversion logistics.
•On July 4, 2025, the One Big Beautiful Bill Act (“OBBB”) was signed into law, making significant amendments to federal tax law including the permanent extension of several provisions of the 2017 Tax Cuts and Jobs Act. These changes are expected to provide incentives that may spur U.S. GDP growth through business investments, consumer spending and industrial activity, which may increase demand for refined products and energy consumption.
June 30, 2025 | 27
•New liquid natural gas (“LNG”) projects coming online and expansion of export capacity in the United States has contributed to the increase of global supply of natural gas and thus downward pressure on prices, and may also support truck fleet shifting from diesel to LNG.
•While the Chinese government has taken several steps to spur economic activity, the Chinese economy is still weighed by a weak property sector and lower domestic demand for transportation fuels. China has seen a significant increase in EV sales as well as the conversion of heavy trucks to LNG. A sustained reduction of Chinese transportation fuel demand could increase global inventories and ultimately impact the prices and margins we realize absent a corresponding decline in production or global crude oil prices.
Regulatory Environment
We continue to be impacted by significant volatility and costs associated with current and proposed laws, rules, regulations and policies, including the reinterpretation and amplification thereof, relating to the RFS, energy transition, and related matters.
•Certain of the Petroleum Segment’s subsidiaries are subject to the RFS (collectively, the “obligated-party subsidiaries”), which, each year, absent exemptions or waivers, requires such obligated-party subsidiaries to blend renewable fuels with transportation fuels, purchase renewable fuel credits, known as renewable identification numbers (“RINs”), in lieu of blending, or otherwise face liability. Our cost to comply with the RFS is dependent upon a variety of factors, which include but are not limited to, the availability of ethanol and biodiesel for blending at our refineries and downstream terminals or RINs for purchase, the actions of RIN market participants including non-obligated parties, the price at which RINs can be purchased, transportation fuel and renewable diesel production levels and pricing including potential discounts thereto related to the RFS, the mix of our products, our refining margins and other factors, all of which can vary significantly from period to period, as well as certain waivers or exemptions to which we may be entitled. Our costs to comply with the RFS further depend on the consistent, timely, and legal administration of the RFS program by the EPA, including the EPA’s unlawful failure to establish the RVOs by their statutory deadlines, its subsequent promulgation of RVOs exceeding the blendwall, its delay in issuing and refusal to issue decisions on pending small refinery exemption (“SRE”) petitions, its subsequent denial of those SRE petitions, most of which have been overturned by courts, and its enabling non-obligated parties to generate, hoard and sell RINs. Our costs to comply with the RFS are also impacted by, and dependent upon the outcome of, the numerous lawsuits filed by multiple refiners including our obligated-party subsidiaries, biofuels groups and others. Refer to Part I, Item 1, Note 12 (“Commitments and Contingencies”) in this Report. As a result, our costs to comply with RFS (excluding the impacts of any exemptions or waivers to which the Petroleum Segment’s obligated-party subsidiaries may be entitled) increased significantly throughout 2022, remained high throughout 2023 and 2024, and is expected to remain significant through 2025 and beyond.
•In the United States in the second quarter of 2025, approximately 7.4% of new-vehicle sales were EVs, a decline of approximately 6.3% from the second quarter of 2024. While the EPA in March 2024 finalized aggressive new motor vehicle emissions standards for light-, medium-, and heavy-duty vehicles for model year 2027 and beyond and the National Highway Traffic Safety Administration (“NHTSA”) of the Department of Transportation (“DOT”) in June 2024 finalized new and aggressive Corporate Average Fuel Economy standards to increase passenger car and light truck fuel economy, the new Administration has rolled back some of these aggressive actions, as indicated in the March 2025 announcement from the EPA Administrator that it will reconsider the standards as well as the June 2025 interpretative rule issued by NHTSA titled “Resetting the Corporate Average Fuel Economy Program” together with certain provisions of the OBBB which includes provisions that rescind or delay various aspects of these standards. In July 2025, the EPA Administrator signed a proposed rule to repeal all greenhouse gas emission standards for light-, medium-, and heavy-duty vehicles and engines.
•During 2024, multiple bills were introduced in Congress that would extend the Biodiesel Blenders’ Tax Credit (“BTC”). Extensions of this tax incentive have been passed by Congress and signed into law close to, and even after, expiration dates in the past. However, we believe provisions of the Inflation Reduction Act that created the Clean Fuel
June 30, 2025 | 28
Production Credit (“PTC”) and provisions of the OBBB, which was signed into law on July 4, 2025 and modifies and extends the PTC, likely signals the end of the BTC. If the BTC is not renewed, RINs prices could be further impacted.
•Uncertainty in the regulatory environment continues as President Trump adjusts the U.S. global trade policy. Crude oil and refined product import and export volumes could be negatively impacted by these changes.
Company Initiatives
•The Company has undertaken a project to replace the hydrofluoric acid catalyst alkylation unit at the refinery in Wynnewood, Oklahoma (the “Wynnewood Refinery”) with a fixed bed catalyst system, which should expand the alkylation unit by approximately 2,500 bpd, increase product capture by reducing propylene production/sales and increase production of premium gasoline, and eliminate hydrofluoric acid inventory onsite. The capital investment is estimated at $136 million, and the unit is expected to become operational by the second quarter of 2027.
•In April 2024, the Board approved a distillate yield improvement project at the Wynnewood Refinery to modify one of the vacuum towers, which may increase distillate production at the refinery by up to approximately 2,400 bpd. Final completion is currently expected in 2027 at a capital cost of less than $15 million. The Company has implemented the first phase of a similar project at the refinery in Coffeyville, Kansas (the “Coffeyville Refinery”) which could increase production of distillate up to 1,300 bpd. The Company is also studying a second phase which could increase production of distillate by up to 2,600 bpd.
•In connection with our settlement with the EPA on certain environmental issues at the Coffeyville Refinery, the Company is in the process of installing a flare gas recovery system at a cost of approximately $50 million, which is expected to be operational in late 2026.
•The Company intends to start production of jet fuel from its Coffeyville Refinery late in the third quarter or fourth quarter of 2025. While production and sales would likely be lower at the outset, they could gradually increase over time to as much as 9,000 bpd and if achieved, could reduce RIN exposure by as much as 18 million RINs per year.
As of June 30, 2025, we have an estimated liability of $548 million for the Petroleum Segment’s obligated-party subsidiaries’ compliance with the RFS for 2020 through 2025, which consists of approximately 508 million RINs, excluding open, fixed-price commitments to purchase a net 5 million RINs. The Company’s open RFS position, which does not consider open commitments expected to settle in future periods, is marked-to-market each period and thus significant market volatility, as experienced in late 2023 through 2025, could impact our RFS expense from period to period.
Market Indicators
NYMEX WTI crude oil is an industry wide benchmark that is utilized in the market pricing of a barrel of crude oil. The pricing differences between other crude oils and WTI, known as differentials, show how the market for other crude oils, such as WCS, White Cliffs (“Condensate”), Brent Crude (“Brent”), and Midland WTI (“Midland”) are trending. Due to geopolitical events, such as the Russia-Ukraine war and the conflict in the Middle East, and, in each case, actions taken by governments and others in response thereto, refined product prices have experienced extreme volatility. As a result of the current environment, refining margins have been and will likely continue to be volatile.
We utilize NYMEX and Group 3 crack spreads as a performance benchmark and a comparison with other industry participants. These crack spreads are a measure of the difference between market prices for crude oil and refined products and are a commonly used proxy within the industry to estimate or identify trends in refining margins. Crack spreads can fluctuate significantly over time as a result of market conditions and supply and demand balances. The NYMEX 2-1-1 crack spread is calculated using two barrels of WTI producing one barrel of NYMEX RBOB Gasoline (“RBOB”) and one barrel of NYMEX NY Harbor ULSD (“HO”). The Group 3 2-1-1 crack spread is calculated using two barrels of WTI crude oil producing one barrel of Group 3 sub-octane gasoline and one barrel of Group 3 ultra-low sulfur diesel.
NYMEX 2-1-1 crack spreads decreased while Group 3 2-1-1 crack spreads increased during the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The NYMEX 2-1-1 crack spread averaged $24.29 per barrel during the six months ended June 30, 2025 compared to $27.85 per barrel in the six months ended June 30, 2024. The Group 3 2-1-1 crack spread averaged $20.89 per barrel during the six months ended June 30, 2025 compared to $19.17 per barrel during the six months ended June 30, 2024.
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Average monthly prices for RINs on a blended barrel basis (calculated using applicable RVO percentages) increased 82.3% during the second quarter of 2025 compared to the same period of 2024. RINs approximated $6.08 per barrel during the second quarter of 2025 compared to $3.34 per barrel during the second quarter of 2024.
The charts below are presented, on a per barrel basis, by month through June 30, 2025:
Crude Oil Differentials against WTI (1)(2) | ||
NYMEX Crack Spreads (2) | ||
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PADD II Group 3 Product Crack Spread and RIN Pricing (2)(3) ($/bbl) | ||
Group 3 Product Differential against NYMEX Products (1)(2) ($/bbl) | ||
(1)The change over time in NYMEX - WTI, as reflected in the charts above, is illustrated below:
| (in $/bbl) | Average 2023 | Average December 2023 | Average 2024 | Average December 2024 | Average 2025 | Average June 2025 | |||||||||||||||||||||||||||||
| WTI | $ | 77.57 | $ | 72.12 | $ | 75.77 | $ | 69.70 | $ | 67.52 | $ | 67.33 | |||||||||||||||||||||||
(2)Information used within these charts was obtained from reputable market sources, including the New York Mercantile Exchange (“NYMEX”), Intercontinental Exchange, and Argus Media, among others.
(3)PADD II is the Midwest Petroleum Area for Defense District (“PADD”), which includes Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee and Wisconsin.
Renewables Segment
The earnings and cash flows of the Renewables Segment are primarily affected by the relationship between renewable fuel prices, the prices for vegetable oils and other feedstocks that are processed and blended into renewable fuels, as well as the prices of various credits generated by the production of renewable fuels together with the cost of operating the renewable diesel unit, including the pre-treatment unit. The cost to acquire vegetable oils and other feedstocks and the price for which renewable fuels are ultimately sold depend on factors beyond the Renewables Segment’s control, including the supply of and demand for
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vegetable oil and other feedstocks, as well as renewable diesel and other renewable fuels which, in turn, depend on, among other factors, changes in domestic and foreign economies and trade policies, driving habits, weather conditions, domestic and foreign political affairs, production levels, the availability or permissibly of imports and exports, the marketing of competitive fuels, and the extent of government regulations. Similar to the Petroleum Segment, the Renewables Segment applies FIFO accounting to value its inventory, and product price movements may thus impact margin as a result of changes in the value of its unhedged inventory. The effect of changes in product prices on the Renewables Segment’s results of operations is partially influenced by the rate at which the processing of renewable fuels adjusts to reflect these changes.
The prices of vegetable oils and other feedstocks and renewable fuels are also affected by other factors, such as soybean crush capacity, system inventory, local and regional market conditions, inflation, and the operating levels of other facilities. Vegetable oil costs and the prices of renewable fuels have historically been subject to wide fluctuations. Widespread expansion or upgrades of third-party facilities, price volatility, international political and economic developments, and other factors are likely to continue to play an important role in renewable fuel industry economics. These factors can impact, among other things, the level of inventories in the market, resulting in price volatility and a reduction in product margins. Specific factors impacting the Company’s operations are outlined below:
Current Market Outlook
•The near-term outlook for the renewables market is likely to be heavily influenced by U.S. government policies, particularly those related to the PTC, which is awaiting formal IRS rule making. On July 4, 2025, the OBBB was signed into law which has changed several elements of the PTC including the removal of land use provisions for the soybean oil carbon intensity (“CI”) calculation. The legislation also included an import ban on certain foreign feedstocks used in renewable fuel production, which may impact supply chain dynamics and feedstock availability. Pending further clarification or guidance on the PTC, we continue to not recognize a PTC benefit.
•The $1 per gallon BTC expired on December 31, 2024, which caused renewable diesel and biodiesel blend rates and imports to fall significantly. With the loss of the BTC, there has been additional volatility in pricing for renewable fuel feedstocks, as well as in prices of other credits generated by renewable fuels production, particularly RINs prices and Low Carbon Fuel Standard (“LCFS”) credit prices. The combination of the above factors has caused RINs prices to increase substantially.
•In June 2025, the EPA proposed the 2026 and 2027 biomass-based diesel volume at 7.12 and 7.50 billion RINs (“D4”), respectively, which is a significant increase over the 2025 volume of 5.36 billion RINs, while holding the ethanol conventional biofuel volume at 15 billion RINs. Public comment on the proposal is due in August 2025. In July 2025, the EPA’s partial waiver of the 2024 cellulosic biofuel volume requirement was published in the Federal Register, making the 2024 RFS compliance reporting deadline for all obligated parties December 1, 2025.
•After a substantial build-out of renewable diesel production capacity in the United States over the past four years, where capacity increased from less than 900 million gallons per year in January 2021 to over 4.5 billion gallons per year in April 2025, further renewable diesel production capacity expansion is expected to slow considerably due to the uncertainties around U.S. government policies and support of renewables businesses.
•In November 2024, the California Air Resources Board (“CARB”) approved material updates to the LCFS, which were finalized in June 2025 and became effective July 1, 2025. These revisions include enhanced carbon intensity reduction targets and feedstock limits and should result in higher credits.
Regulatory Environment
We continue to be impacted by significant volatility and costs associated with current and proposed laws, rules, regulations and policies relating to the RFS, energy transition, and related matters.
•Profitability in the Renewables Segment is highly dependent on the prices of government grants, particularly RINs prices, LCFS credit prices, and tax credits. RINs prices are mainly influenced by supply and demand dynamics, with demand being heavily impacted by the annual RVO levels established by the EPA and legal and regulatory actions. Current market prices for renewable feedstocks are significantly higher than the prices for renewable fuels and, without sufficient government support to stabilize prices for credits generated by renewable fuels production, many renewable fuel producers may not be able to generate profits.
Company Initiatives
•The renewable diesel unit at the Wynnewood Refinery has the flexibility to be returned to hydrocarbon processing service primarily through a catalyst change; depending on market conditions, such as renewable diesel margins,
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governmental regulations, contractual obligations and other factors, the Company could seek to return the unit to hydrocarbon processing service in the future.
•The Company has completed the design of a potential renewables project near its Coffeyville Refinery and is also evaluating a potential project to convert the Wynnewood Renewable Diesel Unit to sustainable aviation fuel service, which projects could reduce the risks associated with government credits through an off-take structure with potential counterparties, by potentially shifting the exposure of those credit prices to the fuel purchaser. However, more clarity on the availability and durability of government subsidies will be necessary in order to invest additional capital or time into these ventures. The Company remains open to the opportunities if approached by potential partners willing to accept the subsidy risk, and if an appropriate environment develops, could resume actively offering its value proposition to the market. Pursuit of either of these projects would be subject to numerous conditions and requirements, such as approval of our Board, regulators, and potential other parties.
Market Indicators
Chicago Board of Trade (“CBOT”) soybean oil is an industry wide benchmark that is utilized in the pricing of renewable fuel feedstocks. The pricing differences between CBOT soybean oil and other renewable feedstocks such as distiller’s corn oil, used cooking oil and animal fats is typically driven by the CI score related to each feedstock along, with overall supply and demand in the market for various feedstocks. Feedstock CI scores play a significant role in the generation of LCFS credits, where lower CI score feedstocks generate higher credit values than higher CI score feedstocks. The PTC would also be calculated based on CI scores, with lower CI scores generating higher credit values.
Approximately 59% of combined biodiesel and renewable diesel production in 2024 was produced from vegetable oils, with animal fats comprising the remaining 41%. Soybean oil comprised approximately 59% of the vegetable oil used as a feedstock, making it one of the primary feedstock pricing benchmarks in the renewables market. As a performance benchmark and a comparison with other industry participants, we utilize the heating oil-bean oil (“HOBO”) spread and a Benchmark Renewable Diesel Margin, as defined in the chart below, that incorporates the HOBO spread along with RINs, LCFS credits, and BTCs generated by renewable diesel production.
The average quarterly HOBO spread deteriorated to $(1.16) per gallon during the six months ended June 30, 2025 compared to $(0.84) per gallon during the six months ended June 30, 2024, primarily as a result of lower ULSD prices and higher soybean oil prices in the current period compared to the prior period. The Benchmark Renewable Diesel Margin declined to $1.07 per gallon during the six months ended June 30, 2025 compared to $1.81 per gallon during the six months ended June 30, 2024, primarily due to the expiration of the BTC and the decline in the HOBO spread, partially offset by increases in prices for RINs and LCFS credits.
Average monthly prices for D4 RINs increased 113% during the second quarter of 2025 compared to the same period of 2024, while LCFS credit prices increased 2% during the second quarter of 2025 compared to the same period of 2024.
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The tables below are presented by month through June 30, 2025:
Benchmark Renewable Diesel Margins (1) (2) (3) | ||
LCFS Credit Price and D4 RIN Market Pricing (1) | Soybean Oil and LA/SF CARB Market Pricing (1) | |||||||
(1)Information used within these charts was obtained from reputable market sources, including the New York Mercantile Exchange (“NYMEX”), CBOT, and Argus Media, among others.
(2)Renewable Diesel Indicator Margin calculated as follows:
(OPIS CARB ULSD + (D4 RIN * 1.7x) + BTC + LCFS Credit(65CI) + CAR + LCFS Fee) - (CBOT Soybean Oil * 7.6 lbs/gal).
(3)HOBO spread represents the Heating Oil – Bean Oil Spread and is calculated as CARB ULSD price per gallon less CBOT Soybean Oil price per gallon.
Nitrogen Fertilizer Segment
Within the Nitrogen Fertilizer Segment, earnings and cash flows from operations are primarily affected by the relationship between nitrogen fertilizer product prices, utilization, and operating costs and expenses, including pet coke and natural gas feedstock costs.
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The price at which nitrogen fertilizer products are ultimately sold depends on numerous factors, including the global supply and demand for nitrogen fertilizer products which, in turn, depends on world grain demand and production levels, changes in world population, the cost and availability of fertilizer transportation infrastructure, weather conditions, the availability of imports, the availability and price of feedstocks to produce nitrogen fertilizer, and the extent of government intervention in agriculture markets, among other factors. These factors can impact, among other things, the level of inventories in the markets, resulting in price and product margin volatility. Moreover, the industry typically experiences seasonal fluctuations in demand for nitrogen fertilizer products.
Certain governmental regulations and incentives associated with the automobile transportation and agricultural industries, including those related to corn-based ethanol and sustainable aviation fuel production and consumption, can impact, and have directly impacted, our business. In June 2023, the EPA announced the renewable volume obligations for 2023, 2024, and 2025 limiting the conventional biofuel volume to 15 billion gallons. In June 2025, the EPA proposed to maintain the conventional biofuel volume at 15 billion gallons for 2026 and 2027. These actions reinforced our belief that the demand for food, particularly corn, for fuel will remain strong for the foreseeable future and support farmer economics that incentivize the use of nitrogen-based fertilizers. In 2024, corn used in ethanol production consumed approximately 37% of the annual production of the U.S. corn crop.
Market Indicators
While there is risk of shorter-term volatility given the inherent nature of the commodity cycle and governmental and geopolitical risks, the Company believes the long-term fundamentals for the U.S. nitrogen fertilizer industry remain intact. The Nitrogen Fertilizer Segment views the anticipated combination of (i) increasing global population, (ii) decreasing arable land per capita, (iii) continued evolution to more protein-based diets in developing countries, (iv) sustained use of corn and soybeans as feedstock for the domestic production of ethanol and other renewable fuels, and (v) positioning at the lower end of the global cost curve should provide a solid foundation for nitrogen fertilizer producers in the United States over the longer term.
Corn and soybeans are two major crops planted by farmers in North America. Corn crops result in the depletion of the amount of nitrogen within the soil in which it is grown, which in turn, results in the need for this nutrient to be replenished after each growing cycle. Unlike corn, soybeans are able to obtain most of their own nitrogen through a process known as “N fixation”. As such, upon harvesting of soybeans, the soil retains a certain amount of nitrogen which results in lower demand for nitrogen fertilizer for the following corn planting cycle. Due to these factors, farmers generally operate a balanced corn-soybean rotational planting cycle as shown by the chart presented below.
The relationship between the total acres planted for both corn and soybeans has a direct impact on the overall demand for nitrogen products, as the market and demand for nitrogen increases with increased corn acres and decreases with increased soybean acres. Additionally, an estimated 14 billion pounds of soybean oil is expected to be used in producing cleaner renewable fuels in marketing year 2025/2026. Multiple refiners have announced renewable diesel expansion projects for 2025 and beyond, which are expected to drive increased demand for soybeans and potentially for corn and canola. However, the viability of these projects remains uncertain given the Trump Administration’s shifting approach on renewable fuels policy and related regulatory frameworks.
Potential tariffs imposed by the U.S. on imports of nitrogen fertilizers could benefit the nitrogen fertilizer business by positively impacting the price of domestically produced fertilizer. However, retaliatory trade actions by other countries, particularly in corn and soybeans, could negatively impact farmer economics and lower demand for nitrogen fertilizer.
The United States Department of Agriculture (“USDA”) estimates that in spring 2025 farmers planted 95.2 million corn acres, representing an increase of 5% compared to 90.7 million corn acres in 2024. Planted soybean acres are estimated to be 83.4 million, representing a decrease of 4% compared to 87.1 million soybean acres in 2024. The combined estimated corn and soybean planted acres of 178.6 million represents a slight increase compared to the acreage planted in 2024. Due to lower input costs in 2025 for corn planting and the relative grain prices of corn versus soybeans, economics favored planting corn compared to soybeans in 2025. Inventory levels of corn and soybeans are expected to be supportive of grain prices into the summer of 2025.
Ethanol is blended with gasoline to meet RFS requirements and for its octane value. Since 2010, corn used in ethanol production has historically consumed approximately 38% of the annual production of the U.S. corn crop, so demand for corn generally rises and falls with ethanol demand. The EPA’s recently proposed renewable volume requirements for 2026 and 2027
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include increased volume requirements for biomass-based diesel and advanced biofuel, which are expected to be supportive of grain demand and prices. The chart below shows the production volumes of fuel ethanol in the U.S.
U.S. Plant Production of Fuel Ethanol (1) | Corn and Soybean Planted Acres (2) | |||||||
(1)Information used within this chart was obtained from the U.S. Energy Information Administration (“EIA”) through June 30, 2025.
(2)Information used within this chart was obtained from the USDA, National Agricultural Statistics Services as of June 30, 2025.
Weather continues to be a critical variable for crop production. Despite high planted acres and above trendline yields per acre for corn in the United States, global inventory levels for corn and soybeans remain near their historical 10-year averages and prices have remained elevated. Demand for nitrogen fertilizer, as well as other crop inputs, has been strong for the spring 2025 planting season, primarily due to elevated grain prices and favorable weather conditions for planting.
While we expect natural gas prices might remain below the elevated levels experienced in 2022 in the near term, we believe the structural shortage of natural gas in Europe will continue to be a source of volatility through at least 2026. Pet coke prices had been elevated since 2021 due to higher oil prices compared to historical levels, but as oil prices have declined, third-party pet coke prices declined in 2024 and have fallen further into 2025.
CVR Partners Initiatives
Based on recently completed engineering studies the facility in Coffeyville, Kansas (the “Coffeyville Fertilizer Facility”) could utilize natural gas as an optional feedstock to pet coke for the production of nitrogen fertilizer, subject to certain modifications. In addition, CVR Partners could import larger than historical quantities of hydrogen directly from the Coffeyville Refinery and increase the nameplate ammonia production of the Coffeyville Fertilizer Facility. The initial stages of the combined project has been approved by the board of directors of CVR Partners’ general partner (the “UAN GP Board”), subject to engineering and final cost estimates. CVR Partners has begun detailed engineering and ordering long lead-time equipment. This project will make the Coffeyville Fertilizer Facility the only nitrogen fertilizer facility in the United States with dual feedstock flexibility.
Over the past two years, CVR Partners has reserved funds for a series of debottlenecking projects that are intended to improve reliability and ultimately facilitate potential additions to production rates at both of its fertilizer facilities. During 2025, CVR Partners has been executing projects focused on water and electrical reliability at its fertilizer facilities, along with expansions of diesel exhaust fluid production and loadout capabilities, among other projects. In addition, during the planned turnaround at the Coffeyville Fertilizer Facility in the fourth quarter of 2025, CVR Partners intends to install a nitrous oxide abatement unit. After installation, CVR Partners will have nitrous oxide abatement units on all four of its nitric acid plants. The funds needed in 2025 for these projects are expected to come from the reserves taken over the past two years.
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The charts below show relevant market indicators for the Nitrogen Fertilizer Segment by month through June 30, 2025:
Ammonia and UAN Market Pricing (1) | ||
Natural Gas Market Pricing (1) | Pet Coke Market Pricing (1) | |||||||
(1)Information used within these charts was obtained from various third-party sources, including Green Markets (a Bloomberg Company), Pace Petroleum Coke Quarterly, and the EIA, amongst others.
Results of Operations
Effective beginning with the 2024 Form 10-K and due to the prominence of the renewables business relative to the Company’s overall 2024 performance, we revised our reportable segments to reflect a new reportable segment: Renewables. The Renewables Segment includes the operations of the renewable diesel unit and renewable feedstock pretreater at the Wynnewood Refinery. Results of the Renewables Segment were not previously included within our reportable segments discussed below, rather included within “Other”. Prior period segment information has been retrospectively adjusted to reflect the current segment presentation.
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Consolidated
Our consolidated results of operations include certain unallocated corporate activities and the elimination of intercompany transactions and, therefore, do not equal the sum of the operating results of the Petroleum, Renewables, and Nitrogen Fertilizer Segments.
Consolidated Financial Highlights (Three and Six Months Ended June 30, 2025 versus June 30, 2024)
Operating (Loss) Income | Net (Loss) Income Attributable to CVR Energy Stockholders | |||||||
(Loss) Earnings per Share | EBITDA (1) | |||||||
(1)See “Non-GAAP Reconciliations” section below for reconciliations of the non-GAAP measures shown above.
Three and Six Months Ended June 30, 2025 versus June 30, 2024 (Consolidated)
Overview - For the three months ended June 30, 2025, the Company’s operating loss and net loss were $103 million and $90 million, respectively, compared to operating income and net income of $27 million and $38 million, respectively, for the three months ended June 30, 2024. For the six months ended June 30, 2025, the Company’s operating loss and net loss were $235 million and $195 million, respectively, compared to operating income and net income of $149 million and $128 million, respectively, for the six months ended June 30, 2024. Refer to our discussion of each segment’s results of operations below for further information.
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Income Tax Benefit - Income tax benefit for the three and six months ended June 30, 2025 was $42 million and $91 million, or 31.7% and 31.8% of loss before income tax, compared to income tax benefit for the three and six months ended June 30, 2024 of $26 million and $10 million, or (219.7)% and (7.2)% of income before income tax. The increase in income tax benefit was primarily due to a decrease in overall pretax earnings from the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2025. In addition, the change in the effective tax rate was primarily due to changes in pretax earnings attributable to noncontrolling interest and the impact of federal and state tax credits and incentives in relation to overall pretax earnings from the three and six months ended June 30, 2024 to the three and six months ended June 30, 2025.
Petroleum Segment
The Petroleum Segment utilizes certain inputs within its refining operations. These inputs include crude oil, butanes, natural gasoline, ethanol, and biodiesel (these are also known as “throughputs”).
Refining Throughput and Production Data by Refinery
| Throughput Data | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
| (in bpd) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Coffeyville | |||||||||||||||||||||||
| Gathered crude | 61,505 | 87,402 | 44,213 | 74,903 | |||||||||||||||||||
| Other domestic | 30,718 | 28,625 | 21,584 | 37,275 | |||||||||||||||||||
| Canadian | 581 | 9,518 | 610 | 9,525 | |||||||||||||||||||
| Condensate | — | 5,079 | — | 6,390 | |||||||||||||||||||
| Other feedstocks and blendstocks | 7,883 | 10,773 | 7,111 | 11,671 | |||||||||||||||||||
| Wynnewood | |||||||||||||||||||||||
| Gathered crude | 55,470 | 34,190 | 56,936 | 38,624 | |||||||||||||||||||
| Other domestic | 1,595 | 2,421 | 1,087 | 1,210 | |||||||||||||||||||
| Condensate | 8,965 | 5,965 | 9,556 | 8,114 | |||||||||||||||||||
| Other feedstocks and blendstocks | 5,432 | 2,235 | 5,309 | 3,287 | |||||||||||||||||||
| Total throughput | 172,149 | 186,208 | 146,406 | 190,999 | |||||||||||||||||||
| Production Data | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
| (in bpd) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Coffeyville | |||||||||||||||||||||||
| Gasoline | 50,323 | 71,515 | 34,718 | 72,119 | |||||||||||||||||||
| Distillate | 46,911 | 57,710 | 33,645 | 56,858 | |||||||||||||||||||
| Other liquid products | (428) | 7,015 | 2,930 | 5,784 | |||||||||||||||||||
| Solids | 3,711 | 4,990 | 2,523 | 4,985 | |||||||||||||||||||
| Wynnewood | |||||||||||||||||||||||
| Gasoline | 36,657 | 25,672 | 38,190 | 28,828 | |||||||||||||||||||
| Distillate | 23,645 | 16,053 | 24,293 | 17,610 | |||||||||||||||||||
| Other liquid products | 8,267 | 2,349 | 6,671 | 3,956 | |||||||||||||||||||
| Solids | 12 | 6 | 11 | 6 | |||||||||||||||||||
| Total production | 169,098 | 185,310 | 142,981 | 190,146 | |||||||||||||||||||
Crude utilization (1) | 76.9 | % | 83.9 | % | 64.9 | % | 85.2 | % | |||||||||||||||
Light product yield (as % of crude throughput) (2) | 99.2 | % | 98.7 | % | 97.7 | % | 99.6 | % | |||||||||||||||
Liquid volume yield (as % of total throughput) (3) | 96.1 | % | 96.8 | % | 95.9 | % | 96.9 | % | |||||||||||||||
Distillate yield (as % of crude throughput) (4) | 44.4 | % | 42.6 | % | 43.2 | % | 42.3 | % | |||||||||||||||
(1)Total Gathered crude, Other domestic, Canadian, and Condensate throughput (collectively, “Total Crude Throughput”) divided by consolidated crude oil throughput capacity of 206,500 bpd.
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(2)Total Gasoline and Distillate divided by Total Crude Throughput.
(3)Total Gasoline, Distillate, and Other liquid products divided by total throughput.
(4)Total Distillate divided by Total Crude Throughput.
Petroleum Segment Financial Highlights (Three and Six Months Ended June 30, 2025 versus June 30, 2024)
Overview - For the three months ended June 30, 2025, the Petroleum Segment’s operating loss and net loss were $133 million and $137 million, respectively, compared to operating income and net income of $10 million and $18 million, respectively, for the three months ended June 30, 2024. These declines were primarily due to lower throughput volumes while intermediate inventory was run off following the completion of the Coffeyville Refinery’s major turnaround which began in the first quarter of 2025 and was completed in April 2025 (the “2025 Turnaround”), an unfavorable derivatives impact in the current period, and an increase in RINs prices in the current period relative to the prior year period, partially offset by increases in gasoline and distillate crack spreads and lower repair and maintenance expenses in the current period. For the six months ended June 30, 2025, the Petroleum Segment’s operating loss and net loss were $295 million and $297 million, respectively, compared to operating income and net income of $128 million and $145 million, respectively, for the six months ended June 30, 2024. Similarly, these declines were primarily due to lower throughput as a result of the 2025 Turnaround and an increase in RINs prices in the current period relative to the prior year period, partially offset by increases in gasoline and distillate crack spreads, lower repair and maintenance expenses, and a favorable derivatives impact in the current period.
| Petroleum Net Sales | Petroleum Operating (Loss) Income | |||||||
Petroleum Net (Loss) Income | Petroleum EBITDA (1) | |||||||
(1)See “Non-GAAP Reconciliations” section below for reconciliations of the non-GAAP measures shown above.
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Net Sales - For the three and six months ended June 30, 2025, net sales for the Petroleum Segment was $1.6 billion and $3.0 billion, respectively, compared to $1.8 billion and $3.5 billion for the three and six months ended June 30, 2024, respectively. The decrease in net sales for both periods was driven by lower throughput as a result of the 2025 Turnaround.
Q2 Petroleum Refining Margin (1) | YTD Petroleum Refining Margin (1) | |||||||
(1)See “Non-GAAP Reconciliations” section below for reconciliations of the non-GAAP measures shown above.
Refining Margin - For the three months ended June 30, 2025, refining margin was $35 million, or $2.21 per throughput barrel, compared to $185 million, or $10.94 per throughput barrel, for the three months ended June 30, 2024. The primary factors contributing to the $150 million decrease in refining margin were:
•Unfavorable sales volume impacts as a result of the 2025 Turnaround;
•An increase in RFS related expense of $122 million, which includes unfavorable RINs revaluation adjustments of $89 million;
•Unfavorable inventory valuation impacts of $31 million for the three months ended June 30, 2025 compared to favorable inventory valuation impacts of $2 million for the three months ended June 30, 2024, primarily due to falling crude oil prices in the current period compared to rising crude oil prices in the second quarter of 2024, coupled with smaller increases in refined product prices in the current period compared to the second quarter of 2024; and
•Unfavorable derivative impacts of $18 million in the 2025 period as compared to the 2024 period resulting primarily from gains on open crack spread swap positions in the second quarter of 2024.
Factors partially offsetting the decrease in refining margin were:
•An increase in the Group 3 2-1-1 crack spread of $5.19 per barrel, driven by an improvement in distillate and gasoline crack spreads primarily due to lower inventory levels and improving demand trends in the current year.
For the six months ended June 30, 2025, refining margin was $30 million, or $1.14 per throughput barrel, compared to $476 million, or $13.68 per throughput barrel, for the six months ended June 30, 2024. The primary factors contributing to the $446 million decrease in refining margin were:
•Unfavorable sales volume impacts as a result of the 2025 Turnaround;
•An increase in RFS related expense of $309 million, which includes unfavorable RINs revaluation adjustments of $291 million; and
•Unfavorable inventory valuation impacts of $10 million for the six months ended June 30, 2025 compared to favorable inventory valuation impacts of $39 million for the six months ended June 30, 2024, primarily due to a decrease in crude oil prices for the six months ended June 30, 2025 as compared to an increase in crude oil prices in the six months ended June 30, 2024.
June 30, 2025 | 41
Factors partially offsetting the decrease in refining margin were:
•An increase in the Group 3 2-1-1 crack spread of $1.72 per barrel, driven by an improvement in gasoline crack spreads primarily due to decreased inventory levels and improving demand trends in the current year; and
•Favorable derivative impacts of $13 million in the 2025 period as compared to the 2024 period resulting primarily from realized gains on Canadian crude oil positions in the current year period.
Q2 Petroleum Direct Operating Expenses (1) | YTD Petroleum Direct Operating Expenses (1) | |||||||
(1)Exclusive of depreciation and amortization expense.
Direct Operating Expenses (Exclusive of Depreciation and Amortization) - For the three and six months ended June 30, 2025, direct operating expenses (exclusive of depreciation and amortization) was $102 million and $193 million, respectively, compared to $118 million and $221 million for the three and six months ended June 30, 2024, respectively. The decrease for the three months ended June 30, 2025 was primarily due to decreased repairs and maintenance expenses. The decrease for the six months ended June 30, 2025 was primarily attributable to elevated repairs and maintenance expenses incurred during the prior- year period related to the fire at the Wynnewood Refinery during severe weather (the “Wynnewood Fire”). On a total throughput barrel basis, direct operating expenses decreased to $6.45 per barrel for the three months ended June 30, 2025, from $6.94 for the three months ended June 30, 2024, and increased to $7.32 per barrel for the six months ended June 30, 2025, from $6.34 per barrel for the six months ended June 30, 2024. The decrease for the three months ended June 30, 2025 was primarily due to lower direct operating expenses, partially offset by decreased throughput volumes resulting from the 2025 Turnaround, and the increase for the six months ended June 30, 2025 was primarily due to decreased throughput volumes resulting from the 2025 Turnaround, partially offset by reduced direct operating expenses, compared to the three and six months ended June 30, 2024, respectively.
June 30, 2025 | 42
| Petroleum Depreciation and Amortization Expense | Petroleum Selling, General, and Administrative Expenses | |||||||
Depreciation and Amortization Expense - For the three and six months ended June 30, 2025, depreciation and amortization expense was $48 million and $90 million, respectively, compared to $43 million and $92 million for the three and six months ended June 30, 2024, respectively. The increase for the three months ended June 30, 2025 was primarily attributable to fixed asset additions during the 2025 Turnaround and the turnaround at the Wynnewood Refinery during 2024 (the “2024 Turnaround”), partially offset by certain assets being retired or fully depreciated prior to the current period. The decrease in the six months ended June 30, 2025 was primarily attributable to certain assets being retired or fully depreciated prior to the current period, partially offset by fixed asset additions during the 2025 and 2024 Turnaround.
Selling, General, and Administrative Expenses - For the three and six months ended June 30, 2025, selling, general and administrative expenses was $20 million and $42 million, respectively, compared to $14 million and $34 million for the three and six months ended June 30, 2024, respectively. The increase in both periods was primarily due to increased share-based compensation as a result of an increase in the market price of CVR Energy’s common shares in the current year periods and a decrease in the market price of CVR Energy’s common shares in the prior year periods.
Renewables Segment
The Renewables Segment utilizes certain inputs within its refining operations. These inputs include corn oil, soybean oil, and other vegetable oils (these are also known as “throughputs”).
Renewables Throughput and Production Data
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in gallons per day) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Throughput Data | |||||||||||||||||||||||
| Corn Oil | 1,107 | 33,253 | 10,488 | 34,947 | |||||||||||||||||||
| Soybean Oil | 153,609 | 93,303 | 144,837 | 66,128 | |||||||||||||||||||
| Production Data | |||||||||||||||||||||||
| Renewable diesel | 148,373 | 117,277 | 146,292 | 89,936 | |||||||||||||||||||
Renewable utilization (1) | 61.4 | % | 50.2 | % | 61.6 | % | 40.1 | % | |||||||||||||||
| Renewable diesel yield (as % of corn and soybean oil throughput) | 95.9 | % | 92.7 | % | 94.2 | % | 89.0 | % | |||||||||||||||
(1)Total corn and soybean oil throughput divided by total renewable throughput capacity of 252,000 gallons per day.
June 30, 2025 | 43
Renewables Segment Financial Highlights
Overview - The Renewables Segment’s operating loss and net loss were $11 million for both the three months ended June 30, 2025 and the three months ended June 30, 2024. The changes in operating loss and net loss compared to the prior period was primarily impacted by increased revenue resulting from higher RINs prices and increased production and sales volumes in the current period as a result of the Wynnewood Fire in the prior year period, offset by the lower HOBO spread and the loss of the BTC in the current period. For the six months ended June 30, 2025, the Renewables Segment’s operating loss and net loss were both $11 million, compared to operating loss and net loss of $21 million and $20 million, respectively, for the six months ended June 30, 2024. The improvement in both operating loss and net loss compared to the prior period was primarily due to increased revenue resulting from higher RINs prices and increased production and sales volumes in the current period as a result of reduced rates from a delayed restart to the RDU during the 2024 Turnaround and 2024 catalyst change, and the Wynnewood Fire, partially offset by reduced rates during the 2025 catalyst change, the lower HOBO spread, and the loss of the BTC in the current period.
| Renewables Net Sales | Renewables Operating Loss | |||||||
Renewables Net Loss | Renewables EBITDA (1) | |||||||
(1)See “Non-GAAP Reconciliations” section below for reconciliations of the non-GAAP measure shown above.
Net Sales - For the three and six months ended June 30, 2025, net sales for the Renewables Segment was $76 million and $142 million, respectively, compared to $63 million and $97 million for the three and six months ended June 30, 2024. The
June 30, 2025 | 44
increase in net sales for both periods was due to increased production and sales volumes coupled with increased D4 RIN prices, partially offset by the loss of the BTC and a decrease in average CARB ULSD prices of $0.24 and $0.25, respectively.
Q2 Renewables Margin (1) | YTD Renewables Margin (1) | |||||||
(1)See “Non-GAAP Reconciliations” section below for reconciliations of the non-GAAP measures shown above.
Renewables Margin - For the three and six months ended June 30, 2025, renewables margin was $5 million and $21 million, respectively, compared to $5 million and $9 million for the three and six months ended June 30, 2024. The primary factors contributing to renewables margin in the current periods were:
•Increased production and sales volumes in the current period;
•An increase in renewable diesel yield due to improved catalyst performance in the current period; and
•An increase in D4 RINs and LCFS credit prices.
Factors partially offsetting the above increases were:
•A decrease in revenue resulting from the expiration of the BTC on December 31, 2024.
•A decrease in average CARB ULSD prices of $0.24 and $0.25, respectively
For the three and six months ended June 30, 2025, renewables margin per vegetable oil throughput gallon was $0.38 and $0.76, respectively, compared to $0.43 and $0.51 for the three and six months ended June 30, 2024, respectively. The decrease for the three months ended June 30, 2025 compared to the prior year period is attributable to the increased throughput in the current period due to the Wynnewood Fire in 2024. The increase for the six months ended June 30, 2025 compared to the prior year period was driven by the increase in RINs prices and sales volumes in the current period.
June 30, 2025 | 45
Q2 Renewables Direct Operating Expenses (1) | YTD Renewables Direct Operating Expenses (1) | |||||||
(1)Exclusive of depreciation and amortization expense.
Direct Operating Expenses (Exclusive of Depreciation and Amortization) - For the three and six months ended June 30, 2025, direct operating expenses (exclusive of depreciation and amortization) were $7 million and $14 million, respectively, compared to $8 million and $13 million for the three and six months ended June 30, 2024, respectively. On a vegetable oil throughput gallon basis, direct operating expenses decreased to $0.54 and $0.51 per gallon from $0.72 and $0.76 per gallon as a function of the increased throughput in the current periods as a result of the Wynnewood Fire in the prior year periods. The decrease in direct operating expenses (exclusive of depreciation and amortization) for the three months ended June 30, 2025 was primarily due to lower expenses for repairs and maintenance, production chemicals and catalysts. The increase for the six months ended June 30, 2025 was attributable to higher environmental expenses in the current period.
Nitrogen Fertilizer Segment
Utilization and Production Volumes - The following tables summarize the consolidated ammonia utilization from the Coffeyville Fertilizer Facility and CVR Partners’ facility in East Dubuque, Illinois (“the East Dubuque Fertilizer Facility”). Utilization is an important measure used by management to assess operational output at each of the Nitrogen Fertilizer Segment’s facilities. Utilization is calculated as actual tons of ammonia produced divided by capacity.
Utilization is presented solely on ammonia production, rather than on each nitrogen product, as it provides a comparative baseline against industry peers and eliminates the disparity of facility configurations for upgrade of ammonia into other nitrogen products. With production primarily focused on ammonia upgrade capabilities, we believe this measure provides a meaningful view of how we operate.
Gross tons of ammonia represent the total ammonia produced, including ammonia produced that was upgraded into other fertilizer products. Net tons available for sale represents the ammonia available for sale that was not upgraded into other
June 30, 2025 | 46
fertilizer products. The table below presents all of these Nitrogen Fertilizer Segment metrics for the three and six months ended June 30, 2025 and 2024:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Ammonia utilization rate | 91 | % | 102 | % | 96 | % | 96 | % | |||||||||||||||
| Production volumes (thousands of tons) | |||||||||||||||||||||||
Ammonia (gross produced) | 197 | 221 | 413 | 414 | |||||||||||||||||||
Ammonia (net available for sale) | 54 | 69 | 117 | 130 | |||||||||||||||||||
| UAN | 321 | 337 | 668 | 643 | |||||||||||||||||||
On a consolidated basis for the three months ended June 30, 2025, the Nitrogen Fertilizer Segment’s utilization increased to 91% compared to 102% for the three months ended June 30, 2024 due primarily to planned downtime associated with control systems upgrades at the East Dubuque Facility and other minor unplanned outages at the Facilities during the second quarter of 2025 (the “Q2 2025 Outages”). For the six months ended June 30, 2025, utilization was 96%, consistent with utilization for the six months ended June 30, 2024. Utilization for the 2025 period was impacted primarily by the Q2 2025 Outages, while the 2024 period was impacted by the 14-day planned outage at the Coffeyville Facility during the first quarter of 2024 (the “Q1 2024 Outage”).
Sales and Pricing per Ton - Two of the Nitrogen Fertilizer Segment’s key operating metrics are total sales volumes for ammonia and UAN, along with the product pricing per ton realized at the gate. Product pricing at the gate represents net sales less freight revenue divided by product sales volume in tons and is shown in order to provide a pricing measure comparable across the fertilizer industry.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Consolidated sales volumes (thousands of tons) | |||||||||||||||||||||||
| Ammonia | 57 | 43 | 117 | 113 | |||||||||||||||||||
| UAN | 345 | 330 | 681 | 614 | |||||||||||||||||||
| Consolidated product pricing at gate (dollars per ton) | |||||||||||||||||||||||
| Ammonia | $ | 593 | $ | 520 | $ | 573 | $ | 525 | |||||||||||||||
| UAN | 317 | 268 | 287 | 268 | |||||||||||||||||||
Feedstock - Our Coffeyville Fertilizer Facility utilizes a pet coke gasification process to produce nitrogen fertilizer. Our East Dubuque Fertilizer Facility uses natural gas in its production of ammonia. The table below presents these feedstocks for both fertilizer facilities within the Nitrogen Fertilizer Segment for the three and six months ended June 30, 2025 and 2024:
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
Petroleum coke used in production (thousands of tons) | 130 | 133 | 261 | 261 | |||||||||||||||||||
Petroleum coke used in production (dollars per ton) | $ | 56.68 | $ | 62.96 | $ | 49.54 | $ | 69.21 | |||||||||||||||
Natural gas used in production (thousands of MMBtus) (1) | 1,897 | 2,213 | 4,057 | 4,361 | |||||||||||||||||||
Natural gas used in production (dollars per MMBtu) (1) | $ | 3.29 | $ | 1.93 | $ | 4.00 | $ | 2.51 | |||||||||||||||
Natural gas in cost of materials and other (thousands of MMBtus) (1) | 2,201 | 1,855 | 3,807 | 3,620 | |||||||||||||||||||
Natural gas in cost of materials and other (dollars per MMBtu) (1) | $ | 3.63 | $ | 1.85 | $ | 4.05 | $ | 2.65 | |||||||||||||||
(1)The feedstock natural gas shown above does not include natural gas used for fuel. The cost of fuel natural gas is included in Direct operating expenses (exclusive of depreciation and amortization).
June 30, 2025 | 47
Nitrogen Fertilizer Segment Financial Highlights (Three and Six Months Ended June 30, 2025 versus June 30, 2024)
Overview - For the three months ended June 30, 2025, the Nitrogen Fertilizer Segment’s operating income and net income were $46 million and $39 million, respectively, compared to operating income and net income of $34 million and $26 million, respectively, for the three months ended June 30, 2024. For the six months ended June 30, 2025, the Nitrogen Fertilizer Segment’s operating income and net income were $81 million and $66 million, respectively, compared to operating income and net income of $54 million and $39 million, respectively, for the six months ended June 30, 2024. These increases were driven in part by higher revenues, primarily due to an increase in UAN and ammonia sales volumes and prices, and favorable sales of other products, as well as lower pet coke feedstock costs, partially offset by higher natural gas and other purchased feedstock costs and increased volumes sold due to draws of UAN and ammonia inventory relative to the three months ended June 30, 2024 and draws of UAN inventory relative to the six months ended June 30, 2024.
| Nitrogen Fertilizer Net Sales | Nitrogen Fertilizer Operating Income | |||||||
Nitrogen Fertilizer Net Income | Nitrogen Fertilizer EBITDA (1) | |||||||
(1)See “Non-GAAP Reconciliations” section below for reconciliations of the non-GAAP measures shown above.
Net Sales - For the three months ended June 30, 2025, the Nitrogen Fertilizer Segment’s net sales was $169 million compared to $133 million for the three months ended June 30, 2024. The increase was primarily due to favorable UAN sales volumes and prices contributing $21 million in higher revenue, combined with favorable ammonia sales volumes and prices contributing $11 million in higher revenue.
June 30, 2025 | 48
The following table demonstrates the impact of changes in sales volumes and pricing for the primary components of net sales, excluding urea products, freight, and other revenue, for the three months ended June 30, 2025 compared to the three months ended June 30, 2024:
| (in millions) | Price Variance | Volume Variance | |||||||||
| UAN | $ | 17 | $ | 4 | |||||||
| Ammonia | 4 | 7 | |||||||||
For the three months ended June 30, 2025 compared to the three months ended June 30, 2024, UAN and ammonia sales volumes increased despite lower production volumes, primarily due to strong demand and a larger shift of product deliveries from the second quarter into the first quarter in the prior year driven by favorable weather allowing farmers to apply earlier iun the year. In addition, UAN and ammonia sales prices were favorable in 2025 due to improved market conditions, primarily driven by tight inventory levels. These inventory constraints resulted from increased demand arising from higher planting acreage in 2025, as well as domestic and international production outages that reduced global supply of nitrogen fertilizers. Higher natural gas prices also raised input costs, contributing to an overall increase in market prices.
For the six months ended June 30, 2025, the Nitrogen Fertilizer Segment’s net sales was $311 million compared to $261 million for the six months ended June 30, 2024. This increase was primarily due to favorable UAN sales volumes and prices contributing $31 million in higher revenues, combined with favorable ammonia sales volumes and prices contributing $8 million in higher revenues.
The following table demonstrates the impact of changes in sales volumes and pricing for the primary components of net sales, excluding urea products, freight, and other revenue, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024:
| (in millions) | Price Variance | Volume Variance | |||||||||
| UAN | $ | 13 | $ | 18 | |||||||
| Ammonia | 6 | 2 | |||||||||
The increase in ammonia and UAN sales pricing for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was due to the same conditions described for the three-month period. The increase in UAN sales volumes for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was primarily attributable to higher UAN production volumes in the current period as a result of the Q1 2024 Outage, partially offset by the Q2 2025 Outages. The increase in ammonia sales volumes is primarily due to increased demand arising from higher planting acreage in 2025.
Cost of Materials and Other - For the three and six months ended June 30, 2025, cost of materials and other was $33 million and $60 million, respectively, compared to $26 million and $51 million for the three and six months ended June 30, 2024 , respectively. These increases were driven primarily by increased volumes sold, increased natural gas prices, higher volumes of other purchased feedstocks, and increased distribution costs in the current periods, partially offset by lower pet coke prices.
Non-GAAP Measures
Our management uses certain non-GAAP performance measures, and reconciliations to those measures, to evaluate current and past performance and prospects for the future to supplement our financial information presented in accordance with accounting principles generally accepted in the United States (“GAAP”). These non-GAAP financial measures are important factors in assessing our operating results and profitability and include the performance and liquidity measures defined below.
The following are non-GAAP measures we present for the periods ended June 30, 2025 and 2024:
EBITDA - Consolidated net income (loss) before (i) interest expense, net, (ii) income tax expense (benefit) and (iii) depreciation and amortization expense.
Petroleum EBITDA, Renewables EBITDA, and Nitrogen Fertilizer EBITDA - Segment net income (loss) before segment (i) interest expense, net, (ii) income tax expense (benefit), and (iii) depreciation and amortization.
June 30, 2025 | 49
Refining Margin - The difference between our Petroleum Segment net sales and cost of materials and other.
Refining Margin per Throughput Barrel - Refining Margin divided by the total throughput barrels during the period, which is calculated as total throughput barrels per day times the number of days in the period.
Direct Operating Expenses per Throughput Barrel - Direct operating expenses for our Petroleum Segment divided by total throughput barrels for the period, which is calculated as total throughput barrels per day times the number of days in the period.
Renewables Margin - The difference between our Renewables Segment net sales and cost of materials and other.
Renewables Margin per Vegetable Oil Throughput Gallon - Renewables Margin divided by the total vegetable oil throughput gallons for the period, which is calculated as total vegetable oil throughput gallons per day times the number of days in the period.
Direct Operating Expenses per Vegetable Oil Throughput Gallon - Direct operating expenses for our Renewables Segment divided by total vegetable oil throughput gallons for the period, which is calculated as total vegetable oil throughput gallons per day times the number of days in the period.
Adjusted EBITDA, Petroleum Adjusted EBITDA, Renewables Adjusted EBITDA, and Nitrogen Fertilizer Adjusted EBITDA - EBITDA, Petroleum EBITDA, Renewables EBITDA, and Nitrogen Fertilizer EBITDA adjusted for certain significant noncash items and items that management believes are not attributable to or indicative of our underlying operational results of the period or that may obscure results and trends we deem useful.
We present these measures because we believe they may help investors, analysts, lenders and ratings agencies analyze our results of operations and liquidity in conjunction with our U.S. GAAP results, including but not limited to our operating performance as compared to other publicly traded companies in the refining and fertilizer industries, without regard to historical cost basis or financing methods and our ability to incur and service debt and fund capital expenditures. Non-GAAP measures have important limitations as analytical tools because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures. See “Non-GAAP Reconciliations” included herein for reconciliation of these amounts. Due to rounding, numbers presented within this section may not add or equal to numbers or totals presented elsewhere within this document.
Factors Affecting Comparability of Our Financial Results
Petroleum Segment
Our results of operations for the periods presented may not be comparable with prior periods or to our results of operations in the future due to capitalized expenditures as part of planned turnarounds. Total capitalized expenditures were $24 million and $3 million during the three months ended June 30, 2025 and 2024, respectively, and $190 million and $42 million during the six months ended June 30, 2025 and 2024, respectively.
June 30, 2025 | 50
Non-GAAP Reconciliations
Reconciliation of Net (Loss) Income to EBITDA and Adjusted EBITDA
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net (loss) income | $ | (90) | $ | 38 | $ | (195) | $ | 128 | |||||||||||||||
| Interest expense, net | 30 | 19 | 55 | 39 | |||||||||||||||||||
| Income tax benefit | (42) | (26) | (91) | (10) | |||||||||||||||||||
| Depreciation and amortization | 78 | 72 | 146 | 149 | |||||||||||||||||||
| EBITDA | (24) | 103 | (85) | 306 | |||||||||||||||||||
| Adjustments: | |||||||||||||||||||||||
Revaluation of RFS liability, unfavorable (favorable) | 89 | — | 200 | (91) | |||||||||||||||||||
Unrealized loss (gain) on derivatives, net | 2 | (17) | (1) | 7 | |||||||||||||||||||
Inventory valuation impacts, unfavorable (favorable) | 32 | 1 | 8 | (36) | |||||||||||||||||||
| Adjusted EBITDA | $ | 99 | $ | 87 | $ | 122 | $ | 186 | |||||||||||||||
Reconciliation of Petroleum Segment Net (Loss) Income to EBITDA and Adjusted EBITDA
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Petroleum net (loss) income | $ | (137) | $ | 18 | $ | (297) | $ | 145 | |||||||||||||||
| Interest (income) expense, net | 5 | (5) | 5 | (10) | |||||||||||||||||||
| Depreciation and amortization | 48 | 43 | 90 | 92 | |||||||||||||||||||
| Petroleum EBITDA | (84) | 56 | (202) | 227 | |||||||||||||||||||
| Adjustments: | |||||||||||||||||||||||
Revaluation of RFS liability, unfavorable (favorable) | 89 | — | 200 | (91) | |||||||||||||||||||
Unrealized loss (gain) on derivatives, net | 2 | (17) | (1) | 7 | |||||||||||||||||||
Inventory valuation impacts, unfavorable (favorable) (1) | 31 | (2) | 10 | (39) | |||||||||||||||||||
| Petroleum Adjusted EBITDA | $ | 38 | $ | 37 | $ | 7 | $ | 104 | |||||||||||||||
(1)The Petroleum Segment’s basis for determining inventory value under GAAP is First-In, First-Out (“FIFO”). Changes in crude oil prices can cause fluctuations in the inventory valuation of crude oil, work in process and finished goods, thereby resulting in a favorable inventory valuation impact when crude oil prices increase and an unfavorable inventory valuation impact when crude oil prices decrease. The inventory valuation impact is calculated based upon inventory values at the beginning of the accounting period and at the end of the accounting period.
June 30, 2025 | 51
Reconciliation of Petroleum Segment Gross (Loss) Profit to Refining Margin
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net sales | $ | 1,561 | $ | 1,795 | $ | 3,038 | $ | 3,517 | |||||||||||||||
| Less: | |||||||||||||||||||||||
| Cost of materials and other | (1,526) | (1,610) | (3,008) | (3,041) | |||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | (102) | (118) | (193) | (221) | |||||||||||||||||||
| Depreciation and amortization | (48) | (43) | (90) | (92) | |||||||||||||||||||
| Gross (loss) profit | (115) | 24 | (253) | 163 | |||||||||||||||||||
| Add: | |||||||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | 102 | 118 | 193 | 221 | |||||||||||||||||||
| Depreciation and amortization | 48 | 43 | 90 | 92 | |||||||||||||||||||
| Refining margin | $ | 35 | $ | 185 | $ | 30 | $ | 476 | |||||||||||||||
| Total throughput barrels per day | 172,149 | 186,208 | 146,406 | 190,999 | |||||||||||||||||||
| Days in the period | 91 | 91 | 181 | 182 | |||||||||||||||||||
| Total throughput barrels | 15,665,597 | 16,944,862 | 26,499,565 | 34,761,961 | |||||||||||||||||||
| Refining margin per total throughput barrel | $ | 2.21 | $ | 10.94 | $ | 1.14 | $ | 13.68 | |||||||||||||||
| Direct operating expenses per total throughput barrel | 6.45 | 6.94 | 7.32 | 6.34 | |||||||||||||||||||
Reconciliation of Renewables Segment Net Loss to EBITDA and Adjusted EBITDA
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Renewables net loss | $ | (11) | $ | (11) | $ | (11) | $ | (20) | |||||||||||||||
Interest income, net | — | — | — | (1) | |||||||||||||||||||
| Depreciation and amortization | 6 | 6 | 12 | 12 | |||||||||||||||||||
| Renewables EBITDA | (5) | (5) | 1 | (9) | |||||||||||||||||||
| Adjustments: | |||||||||||||||||||||||
Inventory valuation impacts, (favorable) unfavorable (1) | 1 | 3 | (2) | 2 | |||||||||||||||||||
| Renewables Adjusted EBITDA | $ | (4) | $ | (2) | $ | (1) | $ | (7) | |||||||||||||||
(1)The Renewables Segment’s basis for determining inventory value under GAAP is FIFO. Changes in renewable diesel and renewable feedstock prices can cause fluctuations in the inventory valuation of renewable diesel, work in process and finished goods, thereby resulting in a favorable inventory valuation impact when renewable diesel prices increase and an unfavorable inventory valuation impact when renewable diesel prices decrease. The inventory valuation impact is calculated based upon inventory values at the beginning of the accounting period and at the end of the accounting period.
June 30, 2025 | 52
Reconciliation of Renewables Segment Gross Loss to Renewables Margin
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions, except throughput data) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net sales | $ | 76 | $ | 63 | $ | 142 | $ | 97 | |||||||||||||||
| Less: | |||||||||||||||||||||||
| Cost of materials and other | (71) | (58) | (121) | (88) | |||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | (7) | (8) | (14) | (13) | |||||||||||||||||||
| Depreciation and amortization | (6) | (6) | (12) | (12) | |||||||||||||||||||
Gross loss | (8) | (9) | (5) | (16) | |||||||||||||||||||
| Add: | |||||||||||||||||||||||
| Direct operating expenses (exclusive of depreciation and amortization) | 7 | 8 | 14 | 13 | |||||||||||||||||||
| Depreciation and amortization | 6 | 6 | 12 | 12 | |||||||||||||||||||
| Renewables margin | $ | 5 | $ | 5 | $ | 21 | $ | 9 | |||||||||||||||
| Total vegetable oil throughput gallons per day | 154,716 | 126,556 | 155,325 | 101,075 | |||||||||||||||||||
| Days in the period | 91 | 91 | 181 | 182 | |||||||||||||||||||
| Total vegetable oil throughput gallons | 14,079,118 | 11,516,572 | 28,113,944 | 18,395,649 | |||||||||||||||||||
| Renewables margin per vegetable oil throughput gallon | $ | 0.38 | $ | 0.43 | $ | 0.76 | $ | 0.51 | |||||||||||||||
| Direct operating expenses per vegetable oil throughput gallon | 0.54 | 0.72 | 0.51 | 0.76 | |||||||||||||||||||
Reconciliation of Nitrogen Fertilizer Segment Net Income to EBITDA and Adjusted EBITDA
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (in millions) | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Nitrogen Fertilizer net income | $ | 39 | $ | 26 | $ | 66 | $ | 39 | |||||||||||||||
| Interest expense, net | 7 | 8 | 15 | 15 | |||||||||||||||||||
| Depreciation and amortization | 21 | 20 | 39 | 39 | |||||||||||||||||||
| Nitrogen Fertilizer EBITDA and Adjusted EBITDA | $ | 67 | $ | 54 | $ | 120 | $ | 93 | |||||||||||||||
Liquidity and Capital Resources
Our principal source of liquidity has historically been cash from operations. As further discussed below, our uses of cash are for working capital, capital and turnaround expenditures, funding our debt service obligations, and paying dividends to our stockholders when approved by the Board of Directors. We may also seek to secure additional liquidity to help mitigate the potential impact of adverse government actions such as the EPAs denial of SREs.
Certain external factors, such as volatile commodity pricing, higher industry utilization, and market oversupply have had an unfavorable impact on our business, especially within our Petroleum segment. These conditions, along with operational incidents at our facilities during 2024, and a major turnaround at our Coffeyville Refinery in 2025, have negatively impacted cash from operations. Despite these challenges, we believe our current liquidity position, combined with the operational improvements following the completion of the turnaround, the Board’s decision to temporarily suspend cash dividend payments and the additional measures implemented by management and approved by the Board, is sufficient to support our operations and capital needs for at least the next 12 months. These additional measures have included:
(1)Deferring new growth capital spending; and
June 30, 2025 | 53
(2)Reducing capital expenditures in 2025 to only those projects that are critical to maintaining safe and reliable operations, necessary for environmental or regulatory compliance or required to support future activities.
Concurrently, the Company has taken additional actions to enhance its liquidity, including:
(1)In December 2024, entered into a senior secured term loan facility in the amount of $325 million (the “Term Loan”), which has scheduled quarterly principal amortization payments in an amount equal to 0.25% of the aggregate principal amount of the initial term loans and maturity on December 30, 2027;
(2)In December 2024, sold the 50% limited liability company interest it owned in Midway Pipeline LLC for cash consideration of approximately $90 million;
(3)Entered into an Incremental Commitment Agreement for an amount of $70 million, which increased the total aggregate principal amount available under CVR Energy’s Amended and Restated ABL Credit Agreement (the “CVR Energy ABL”) from $275 million to $345 million; and
(4)Explored additional efforts to control costs.
These actions enabled the Company to successfully complete the major turnaround in 2025 and improve cash balances. As a result, during the second and third quarters of 2025, the Company applied $70 million and $20 million, respectively, towards prepayments of the Term Loan. These decisions reflect the Company’s continued focus on financial discipline and maintaining adequate capital to support operations throughout this environment of uncertainty. The Board will continue to evaluate the economic environment, the Company’s liquidity needs, optimal uses of cash, payment of dividends (if any), and other relevant factors, and may elect to make additional changes to the Company’s capital allocation in future periods.
While we believe that our cash from operations and existing cash and cash equivalents, along with borrowings from available lines of credit, as necessary, will be sufficient to satisfy anticipated cash requirements associated with our existing operations for at least the next 12 months, our future expenditures for turnaround, capital expenditures and other cash requirements could be higher than we currently expect as a result of various factors including, but not limited to, rising material and labor costs, other inflationary pressures, interest rate fluctuations, and the costs associated with complying with the RFS and the outcome of litigation and other factors. Additionally, potential supply chain disruptions, geopolitical and economy instability, volatility in energy prices, the impacts of increasing electric vehicles and liquid natural gas and other improvements in fuel efficiencies and changes in regulatory policies could adversely affect our operations. Our ability to generate sufficient cash from our operating activities in the current commodity price environment, sell non-core assets, access capital markets, incur additional debt or take any other action to improve our liquidity is subject to the risks discussed above and elsewhere in our periodic reports and the other risks and uncertainties that exist in our industry, and depends on our future operational performance, which is subject to general economic, political, financial, competitive, and other factors, some of which may be beyond our control. Furthermore, shifts in demand and tightening credit market conditions could impact our financial stability.
Depending on the needs of our business, contractual limitations, and market conditions, we may, from time to time, seek to issue equity securities, incur additional debt, issue debt securities, or redeem, repurchase, refinance, or retire our outstanding debt through privately negotiated transactions, open market repurchases, redemptions, exchanges, tender offers or otherwise. There can be no assurance that we will seek to do any of the foregoing or that we will be able to do any of the foregoing on terms acceptable to us or at all. We closely monitor the amounts and timing of our sources and uses of funds and the availability of borrowings, if any, under the CVR Energy ABL. Our ability to incur additional indebtedness could be restricted by the terms of our existing senior notes, the CVR Energy ABL, or the Term Loan.
The Company and its subsidiaries were in compliance with applicable financial covenants under their respective debt instruments as of June 30, 2025, and through the date of filing of this Report, as applicable.
Cash Balances and Other Liquidity
As of June 30, 2025, we had total liquidity of approximately $920 million. Total liquidity consists of $596 million of consolidated cash and cash equivalents, $277 million available under the CVR Energy ABL, and $47 million available under the CVR Partners’ Credit Agreement (“CVR Partners ABL”). As of December 31, 2024, we had total liquidity of approximately $1.3 billion. Total liquidity consisted of $987 million of consolidated cash and cash equivalents, $238 million available under the CVR Energy ABL, and $39 million available under the CVR Partners ABL.
June 30, 2025 | 54
Long-term debt consisted of the following:
| (in millions) | June 30, 2025 | December 31, 2024 | |||||||||
| CVR Energy: | |||||||||||
5.75% Senior Notes, due February 2028 | $ | 400 | $ | 400 | |||||||
8.50% Senior Notes, due January 2029 | 600 | 600 | |||||||||
| Unamortized debt issuance costs | (3) | (4) | |||||||||
| Total CVR Energy debt | 997 | 996 | |||||||||
Petroleum Segment: | |||||||||||
| Term Loan | 250 | 322 | |||||||||
| Unamortized debt discount and debt issuance costs | (6) | (8) | |||||||||
Total Petroleum Segment debt | 244 | 314 | |||||||||
Nitrogen Fertilizer Segment: | |||||||||||
6.125% Senior Secured Notes, due June 2028 | 550 | 550 | |||||||||
| Unamortized debt issuance costs | (2) | (2) | |||||||||
Total Nitrogen Fertilizer Segment debt | 548 | 548 | |||||||||
| Total long-term debt | 1,789 | 1,858 | |||||||||
| Current portion of long-term debt | 3 | 3 | |||||||||
| Total long-term debt, including current portion | $ | 1,792 | $ | 1,861 | |||||||
Refer to Part II, Item 8, Note 8 (“Long-Term Debt and Finance Lease Obligations”) of our 2024 Form 10-K for further discussion of these debt instruments.
Capital Spending
We divide capital spending needs into two categories: maintenance and growth. Maintenance capital spending includes non-discretionary maintenance projects and projects required to comply with environmental, health, and safety regulations. Growth capital projects generally involve an expansion of existing capacity, reliability improvements, and/or a reduction in direct operating expenses. We undertake growth capital spending based on the expected return on incremental capital employed, which is typically funded by reserves taken in prior years.
Our total capital expenditures for the six months ended June 30, 2025, along with our estimated expenditures for 2025, by segment, are as follows:
| Six Months Ended June 30, 2025 Actual | 2025 Estimate | |||||||||||||||||||||||||||||||
| Maintenance | Growth | Total | ||||||||||||||||||||||||||||||
(in millions) | Maintenance | Growth | Total | Low | High | Low | High | Low | High | |||||||||||||||||||||||
| Petroleum | $ | 55 | $ | 17 | $ | 72 | $ | 70 | $ | 80 | $ | 30 | $ | 40 | $ | 100 | $ | 120 | ||||||||||||||
| Renewables | 1 | 1 | 2 | 3 | 5 | 1 | 3 | 4 | 8 | |||||||||||||||||||||||
| Nitrogen Fertilizer | 10 | 6 | 16 | 40 | 45 | 15 | 20 | 55 | 65 | |||||||||||||||||||||||
| Other | — | 2 | 2 | 5 | 7 | 1 | 2 | 6 | 9 | |||||||||||||||||||||||
| Total | $ | 66 | $ | 26 | $ | 92 | $ | 118 | $ | 137 | $ | 47 | $ | 65 | $ | 165 | $ | 202 | ||||||||||||||
Our estimated capital expenditures are subject to further change due to changes in capital projects’ cost, scope, and completion time. For example, we may experience labor or equipment cost changes necessary to comply with government regulations or to complete projects that sustain the operations of the refineries or facilities. The UAN GP Board determines CVR Partners’ capital spending. We will continue to monitor market conditions and make adjustments, if needed, to our current capital spending or turnaround plans. We may also accelerate or defer some capital expenditures from time to time. For example, as described further above, volatile commodity pricing and higher industry utilization and oversupply have had an unfavorable impact on our business and have negatively impacted our cash from operating activities and liquidity. As a result,
June 30, 2025 | 55
in October 2024, the Board elected to suspend payment of the cash dividend, defer new growth capital spending, and reduce certain expected capital expenditures, as further discussed under “Liquidity and Capital Resources” above.
There are currently no additional turnarounds planned in the Petroleum Segment for the remainder of 2025 or 2026. The Petroleum Segment’s total capitalized expenditures were $24 million and $3 million during the three months ended June 30, 2025 and 2024, respectively, and $190 million and $42 million during the six months ended June 30, 2025 and 2024, respectively.
The next planned turnarounds for the Nitrogen Fertilizer Segment are currently scheduled to commence in the fourth quarter of 2025 at the Coffeyville Fertilizer Facility, costing approximately $15 million and lasting 30 days, and in 2026 at the East Dubuque Fertilizer Facility. Turnaround costs in the Nitrogen Fertilizer Segment are not capitalized, but instead are expensed as incurred, and are expected to be funded through cash reserves taken during the three years preceding the turnaround.
Cash Requirements
There have been no material changes to the cash requirements disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, outside the ordinary course of business, except as follows:
Term Loan Prepayment - On June 30, 2025, certain of the Company’s subsidiaries (the “Term Loan Borrowers”) prepaid $70 million in principal of the Term Loan, in addition to required principal and interest payments as set forth in the Term Loan. Further, on July 25, 2025, the Term Loan Borrowers prepaid an additional $20 million in principal of the Term Loan, plus any accrued and unpaid interest to the redemption date. Refer to Part I, Item 1, Note 7 (“Long-Term Debt and Finance Lease Obligations”) of this Report for further discussion.
Dividends to CVR Energy Stockholders
Dividends, if any, including the payment, amount and timing thereof, are determined at the discretion of the Board. IEP, through its ownership of the Company’s common stock, is entitled to receive dividends that are declared and paid by the Company based on the number of shares held at each record date. The following table presents quarterly distributions paid to the Company’s stockholders, including IEP, during 2024 (amounts presented in the table below may not add to totals presented due to rounding):
Quarterly Dividends Paid (in millions) | ||||||||||||||||||||||||||||||||
| Related Period | Date Paid | Quarterly Dividends Per Share | Public Stockholders | IEP | Total | |||||||||||||||||||||||||||
2023 - 4th Quarter | March 11, 2024 | $ | 0.50 | $ | 17 | $ | 33 | $ | 50 | |||||||||||||||||||||||
2024 - 1st Quarter | May 20, 2024 | 0.50 | 17 | 33 | 50 | |||||||||||||||||||||||||||
2024 - 2nd Quarter | August 19, 2024 | 0.50 | 17 | 33 | 50 | |||||||||||||||||||||||||||
Total 2024 quarterly dividends | $ | 1.50 | $ | 51 | $ | 100 | $ | 151 | ||||||||||||||||||||||||
There were no quarterly dividends declared or paid during the fourth quarter of 2024, first quarter of 2025, or second quarter of 2025 related to the third and fourth quarter of 2024 and first quarter of 2025, respectively. There were no quarterly dividends declared for the second quarter of 2025.
Distributions to CVR Partners’ Unitholders
Distributions, if any, including the payment, amount and timing thereof, and UAN GP Board’s distribution policy, including the definition of available cash, are subject to change at the discretion of the UAN GP Board. The following tables present quarterly distributions paid by CVR Partners to CVR Partners’ unitholders, including amounts received by the
June 30, 2025 | 56
Company and IEP, during 2025 and 2024 (amounts presented in the tables below may not add to totals presented due to rounding):
| Quarterly Distributions Per Common Unit | Quarterly Distributions Paid (in millions) | |||||||||||||||||||||||||||||||||||||
| Related Period | Date Paid | Public Unitholders | IEP | CVR Energy | Total | |||||||||||||||||||||||||||||||||
| 2024 - 4th Quarter | March 10, 2025 | $ | 1.75 | $ | 11 | $ | — | $ | 7 | $ | 18 | |||||||||||||||||||||||||||
| 2025 - 1st Quarter | May 19, 2025 | 2.26 | 14 | 1 | 9 | 24 | ||||||||||||||||||||||||||||||||
Total 2025 quarterly distributions | $ | 4.01 | $ | 26 | $ | 1 | $ | 16 | $ | 42 | ||||||||||||||||||||||||||||
2023 - 4th Quarter | March 11, 2024 | $ | 1.68 | $ | 11 | $ | — | $ | 7 | $ | 18 | |||||||||||||||||||||||||||
2024 - 1st Quarter | May 20, 2024 | 1.92 | 13 | — | 7 | 20 | ||||||||||||||||||||||||||||||||
2024 - 2nd Quarter | August 19, 2024 | 1.90 | 13 | — | 7 | 20 | ||||||||||||||||||||||||||||||||
2024 - 3rd Quarter | November 18, 2024 | 1.19 | 7 | — | 5 | 13 | ||||||||||||||||||||||||||||||||
Total 2024 quarterly distributions | $ | 6.69 | $ | 44 | $ | — | $ | 26 | $ | 71 | ||||||||||||||||||||||||||||
For the second quarter of 2025, CVR Partners, upon approval by the UAN GP Board on July 30, 2025, declared a distribution of $3.89 per common unit, or approximately $41 million, which is payable August 18, 2025 to unitholders of record as of August 11, 2025. Of this amount, CVR Energy and IEP will receive approximately $15 million and $1 million, respectively, with the remaining amount payable to public unitholders.
Cash Flows
The following table sets forth our consolidated cash flows for the periods indicated below:
| Six Months Ended June 30, | |||||||||||||||||
| (in millions) | 2025 | 2024 | Change | ||||||||||||||
| Net cash provided by (used in): | |||||||||||||||||
Operating activities | $ | (19) | $ | 258 | $ | (277) | |||||||||||
Investing activities | (267) | (129) | (138) | ||||||||||||||
Financing activities | (105) | (729) | 624 | ||||||||||||||
| Net (decrease) increase in cash, cash equivalents, reserved funds, and restricted cash | $ | (391) | $ | (600) | $ | 209 | |||||||||||
Operating Activities
The change in net cash provided by operating activities for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was primarily attributable to the net loss of $195 million in 2025 versus the net income of $128 million in 2024. Additionally, there was a decrease in net operating cash flows from changes in working capital, primarily due to unfavorable changes to accounts payable and inventory, mainly related to the 2025 Turnaround. These impacts were partially offset by favorable changes in other current liabilities and accounts receivables, driven by the volatility of our obligated-party subsidiaries’ RFS obligation during the current period.
Investing Activities
The change in net cash used in investing activities for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 was primarily due to an increase in turnaround expenditures of $147 million in 2025 compared to 2024, arising from the 2025 Turnaround, partially offset by proceeds from the sale of assets and insurance proceeds received from the Wynnewood Fire.
June 30, 2025 | 57
Financing Activities
The change in net cash used for financing activities for the six months ended June 30, 2025 compared to the net cash used in financing activities for the six months ended June 30, 2024 was primarily due to the $600 million redemption of the 5.25% Senior Notes due 2025 in 2024, with no dividends paid to CVR Energy stockholders during 2025 compared to $101 million in dividends paid during 2024. This was partially offset by principal payments on the Term Loan of $72 million during 2025.
Critical Accounting Estimates
Our critical accounting estimates are disclosed in the “Critical Accounting Estimates” section of our 2024 Form 10-K. No modifications have been made during the three and six months ended June 30, 2025 to these estimates.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to our market risks as of and for the three and six months ended June 30, 2025, as compared to the risks discussed in Part II, Item 7A of our 2024 Form 10-K.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company has evaluated, under the direction and with the participation of the Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures, as defined in Exchange Act Rule 13a-15(e) and 15d-15(e). Based upon this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that disclosure controls and procedures were effective as of June 30, 2025.
Changes in Internal Control Over Financial Reporting
There have been no material changes in our internal controls over financial reporting required by Rule 13a-15 of the Exchange Act that occurred during the fiscal quarter ended June 30, 2025 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
June 30, 2025 | 58
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
See Part I, Item 1, Note 12 (“Commitments and Contingencies”) of this Report, which is incorporated by reference into this Part II, Item 1, for a description of certain litigation, legal, and administrative proceedings and environmental matters.
Item 1A. Risk Factors
There have been no material changes from the risk factors previously disclosed in Part I, Item 1A of our 2024 Form 10-K. Additional risks and uncertainties, including risks and uncertainties not presently known to us, or that we currently deem immaterial, could also have an adverse effect on our business, financial condition, and/or results of operations.
Item 5. Other Information
During the three months ended June 30, 2025, no director or officer of the Company adopted terminated
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Board of Directors
On July 28, 2025, the Board of Directors (the “Board”) of CVR Energy, Inc. (the “Company”) increased the size of the Board from eight members to nine members and appointed Brett Icahn to fill the newly created directorship effective on August 1, 2025. Mr. Icahn is employed by Icahn Enterprises L.P. or its affiliates (“IEP”) and was selected as a director of the Company as a result of his role with IEP. The Company and IEP are each indirectly controlled by Carl C. Icahn, Mr. Icahn’s father. IEP indirectly owns approximately 70 % of the outstanding shares of common stock of the Company. The Company is not aware of any other transactions in which Mr. Icahn has an interest that would be required to be disclosed under Item 404(a) of Regulation S-K, and there are no other arrangements or understandings between him and any other persons pursuant to which he was selected as a director. Mr. Icahn will not receive compensation for his service on the Board or its committees as long as he is employed by IEP.
Mr. Icahn will enter into the Company’s standard form of indemnification agreement pursuant to which the Company is required to indemnify Mr. Icahn against certain liabilities that may arise by reason of his service as a director and to advance certain expenses to him. The form of the indemnification agreement has been filed as Exhibit 10.49 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
Executive Management
Amendment to Employment Agreement with David L. Lamp
On July 28, 2025, the Compensation Committee (the “Compensation Committee”) of the Board approved, and entered into, an amendment (the “Amendment”) to the employment agreement by and between the Company and David L. Lamp, the Company’s President and Chief Executive Officer, dated December 12, 2024 (the “Lamp Employment Agreement”). The Amendment provides that Mr. Lamp may voluntarily resign his employment for any reason during the term upon not less than five (5) months’ notice and that the Resignation Notice Requirement (as defined in the Lamp Employment Agreement) will be satisfied upon five (5) months’ notice of Mr. Lamp’s intent to resign from the Company without Good Reason (as defined in the Lamp Employment Agreement).
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, which is filed with this Report as Exhibit 10.11 and is incorporated herein in its entirety by reference.
June 30, 2025 | 59
Resignation of David L. Lamp
On July 28, 2025, in accordance with the Lamp Employment Agreement, as amended by the Amendment, Mr. Lamp notified the Company of his intention to resign without Good Reason from his position as President and Chief Executive Officer of the Company, as well as from all other officer and director positions he holds with the Company’s direct and indirect subsidiaries, other than as a director of the Board and of the general partner of CVR Partners, LP (“CVR Partners”), in each case effective December 31, 2025. Mr. Lamp’s decision to resign from his positions with the Company was not the result of any disagreement with the Company or any matter relating to the operations, policies or practices of the Company. Mr. Lamp is expected to remain on the Board and also on the board of directors of the general partner of CVR Partners.
Employment Agreement with Mark A. Pytosh
On July 28, 2025, the Compensation Committee also approved, and the Company entered into, an employment agreement (the “Pytosh Employment Agreement”) with Mark A. Pytosh, who currently serves as the Executive Vice President – Corporate Services of the Company and has held such position since January 2018, pursuant to which he is expected to be appointed as President and Chief Executive Officer and Director of the Company and which, subject to the satisfaction of the conditions set forth therein, will commence on January 1, 2026. The Pytosh Employment Agreement provides for an initial three (3)-year term which extends automatically for successive one-year renewal terms, unless either the Company or Mr. Pytosh provides six (6) months’ notice of its or his (as applicable) intent to not extend the term. Under the terms of the Pytosh Employment Agreement, Mr. Pytosh’s base salary will be $1,100,000 and Mr. Pytosh will be eligible to receive an annual cash bonus with a target equal to 150% of his base salary under the performance-based bonus plan approved by the Compensation Committee (the “Annual Bonus”). Mr. Pytosh is also entitled to receive an annual award (“LTIP Award”) equal to 150% of his base salary under or in connection with the Company’s Third Amended and Restated 2007 Long Term Incentive Plan, or its successor (the “Plan”), which LTIP Awards are expected to vest ratably on each of the first three anniversaries of the applicable grant date, subject to certain customary forfeiture and acceleration provisions and the terms of the applicable award agreement and the Plan.
The Pytosh Employment Agreement also provides that Mr. Pytosh will be eligible to receive a transaction bonus in cash equal to (x) $10,000,000 upon the consummation of a Significant CVI Transaction (as defined in the Pytosh Employment Agreement) and (y) $2,500,000 upon the consummation of a Significant UAN Transaction (as defined in the Pytosh Employment Agreement), in each case, provided that such Significant CVI Transaction or Significant UAN Transaction is consummated during the term of the Pytosh Employment Agreement or within the sixty (60) days following a Qualifying Termination (as defined below).
The Pytosh Employment Agreement also entitles Mr. Pytosh to certain severance payments in the event his employment is terminated (a) by the Company without Cause (as defined in the Pytosh Employment Agreement) or (b) by Mr. Pytosh for Good Reason (as defined in the Employment Agreement) (each, a “Qualifying Termination”). Upon a Qualifying Termination, Mr. Pytosh will be entitled to receive the following severance payments, subject in each case to applicable deductions and withholdings, as well as other terms and conditions set forth in the Pytosh Employment Agreement, including Mr. Pytosh’s continued compliance with certain restrictive covenants and his timely execution and non-revocation of a release of claims:
•A cash payment equal to 1.5 times the sum of (A) twelve months of the base salary plus (B) the average of the annual bonuses actually paid to Mr. Pytosh during the three (3) calendar years immediately preceding the date of termination, payable in substantially equal installments over the eighteen (18)-month period following the date of termination (the “Severance Payment”);
•A cash payment equal to the actual Annual Bonus that would have otherwise been earned for the year of termination, based on achievement of the individual and/or corporate performance criteria, prorated based on the date of termination (a “Pro-Rata Bonus”); and
•Accelerated vesting as to 100% of the unvested portion of any then-outstanding Incentive / Phantom Unit Awards (as defined in the Pytosh Employment Agreement) (“Accelerated LTIP Vesting”).
Without duplication, if Mr. Pytosh experiences a Qualifying Termination during the Change in Control Period (as defined in the Pytosh Employment Agreement), the Severance Payment and Pro-Rata Bonus will instead be payable in a cash lump, provided that such lump sum payment will be reduced by any portion of the Severance Payment and/or Pro-Rata Bonus that was received by Mr. Pytosh prior to the consummation of the Change in Control (as defined in the Pytosh Employment Agreement).
June 30, 2025 | 60
If Mr. Pytosh resigns without Good Reason, but provides at least six (6) months’ notice of his intent to resign, he will receive a cash payment equal to the target Annual Bonus, prorated based on the date of termination (a “Target Pro-Rata Bonus”). If the Pytosh Employment Agreement is terminated due to Mr. Pytosh’s death or Disability (as defined in the Pytosh Employment Agreement), Mr. Pytosh will receive a Target Pro-Rata Bonus and Accelerated LTIP Vesting, payable in a lump sum cash payment.
The Pytosh Employment Agreement also contains other terms customary for agreements of this type, including confidentiality, non-disparagement and non-competition obligations and supersedes all prior agreements and understandings by and between Mr. Pytosh and the Company, including, without limitation, the Change in Control and Severance Plan Participation Agreement by and between Mr. Pytosh and the Company. Mr. Pytosh’s biography as detailed in the Company’s most recent Schedule 14A filed on April 22, 2025, is hereby incorporated by reference. Following his expected appointment to the Board, Mr. Pytosh is expected to remain as a Director and President and Chief Executive Officer of the general partner of CVR Partners.
The foregoing description of the Pytosh Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Pytosh Employment Agreement, which is filed with this Report as Exhibit 10.12 and is incorporated herein in its entirety by reference.
Entry into a Material Definitive Agreement
On July 29, 2025, CVR Supply & Trading, LLC, a subsidiary of the Company (“CVR S&T”), and Gunvor USA LLC, a subsidiary of Gunvor Group Ltd (“Gunvor”), entered into Amendment No. 1 to the Amended and Restated Crude Oil Supply Agreement (the “Gunvor Amendment”), which, among other things, (i) extended the initial term of the Amended and Restated Crude Oil Supply Agreement, dated December 21, 2023, by and between CVR S&T and Gunvor (as amended, the “Gunvor Crude Oil Supply Agreement”) from January 31, 2026 to January 31, 2029, subject to two successive automatic one-year renewal terms in the absence of 180 days’ notice of termination prior to the expiration of the initial term or the then-current renewal term, as the case may be, and (ii) adjusted the origination fee payable by CVR S&T for each barrel of crude oil purchased by Gunvor for supply to CVR S&T under the Gunvor Crude Oil Supply Agreement. The Gunvor Amendment is effective as of February 1, 2026. The foregoing description of the Gunvor Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Gunvor Amendment, which will be filed with the Company’s quarterly report on Form 10-Q for the quarter ending September 30, 2025.
Item 6. Exhibits
| INDEX TO EXHIBITS | ||||||||
| Exhibit Number | Exhibit Description | |||||||
| 10.1**^ | ||||||||
| 10.2**^ | ||||||||
| 10.3**^ | ||||||||
| 10.4**^ | ||||||||
| 10.5**^ | ||||||||
| 10.6**^ | ||||||||
| 10.7*^ | ||||||||
| 10.8*+^ | ||||||||
| 10.9*+^ | ||||||||
| 10.10*+^ | ||||||||
| 10.11*^ | ||||||||
June 30, 2025 | 61
| 10.12*^ | ||||||||
| 31.1* | ||||||||
| 31.2* | ||||||||
| 31.3* | ||||||||
| 32.1† | ||||||||
| 101* | The following financial information for CVR Energy, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 formatted Inline XBRL (“Extensible Business Reporting Language”) includes: (i) Condensed Consolidated Balance Sheets (unaudited), (ii) Condensed Consolidated Statements of Operations (unaudited), (iii) Condensed Consolidated Statement of Changes in Equity (unaudited), (iv) Condensed Consolidated Statements of Cash Flows (unaudited) and (v) the Notes to Condensed Consolidated Financial Statements (unaudited), tagged in detail. | |||||||
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | |||||||
| * | Filed herewith. | ||||
| ** | Previously filed. | ||||
| † | Furnished herewith. | ||||
| + | Certain portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Company agrees to furnish supplementally an unredacted copy of this exhibit to the SEC upon request. | ||||
| ^ | Denotes management contract or compensatory plan or arrangement. | ||||
PLEASE NOTE: Pursuant to the rules and regulations of the SEC, we may file or incorporate by reference agreements as exhibits to the reports that we file with or furnish to the SEC. The agreements are filed to provide investors with information regarding their respective terms. The agreements are not intended to provide any other factual information about the Company, its business or operations. In particular, the assertions embodied in any representations, warranties and covenants contained in the agreements may be subject to qualifications with respect to knowledge and materiality different from those applicable to investors and may be qualified by information in confidential disclosure schedules not included with the exhibits. These disclosure schedules may contain information that modifies, qualifies and creates exceptions to the representations, warranties and covenants set forth in the agreements. Moreover, certain representations, warranties and covenants in the agreements may have been used for the purpose of allocating risk between the parties, rather than establishing matters as facts. In addition, information concerning the subject matter of the representations, warranties and covenants may have changed after the date of the respective agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. Accordingly, investors should not rely on the representations, warranties and covenants in the agreements as characterizations of the actual state of facts about the Company, its business or operations on the date hereof.
June 30, 2025 | 62
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| CVR Energy, Inc. | |||||||||||
| July 31, 2025 | By: | /s/ Dane J. Neumann | |||||||||
| Executive Vice President, Chief Financial Officer, Treasurer and Assistant Secretary | |||||||||||
| (Principal Financial Officer) | |||||||||||
| July 31, 2025 | By: | /s/ Jeffrey D. Conaway | |||||||||
| Vice President, Chief Accounting Officer and Corporate Controller | |||||||||||
| (Principal Accounting Officer) | |||||||||||
June 30, 2025 | 63
Exhibit 10.7
CVR ENERGY, INC.
CHANGE IN CONTROL AND SEVERANCE PLAN
CHANGE IN CONTROL AND SEVERANCE PLAN
1.Introduction. The purpose of this CVR Energy, Inc. Change in Control and Severance Plan (the “Plan”) is to provide assurances of specified benefits to designated employees of the Company who are members of a select group of management or highly compensated employees (as determined in accordance with Section 201(2), 301(a)(3) and 401(a)(1) of ERISA) in the event their employment is involuntarily terminated in connection with a Change in Control under the circumstances described in this Plan. Effective as of the effective date of the Change in Control, but contingent on the occurrence of the Change in Control, unless otherwise agreed to in writing between the Company or an Affiliate and an Eligible Employee on or after the date hereof, this Plan shall supersede, and Eligible Employees covered by the Plan shall not be eligible to participate in, the CVR Services, LLC Severance Pay Plan, the CVR Partners, LP Severance Pay Plan or any other severance or termination plan, policy or practice of the Company or any of its Affiliates that would otherwise apply under the circumstances described herein. The Plan is intended to be a “top-hat” pension benefit plan within the meaning of U.S. Department of Labor Regulation Section 2520.104-24.
2.Important Terms. In addition to the defined terms set forth throughout the Plan, the following words and phrases, when the initial letter of the term is capitalized, will have the meanings set forth in this Section 2, unless a different meaning is plainly required by the context:
2.1 “Accrued Amounts” means the sum of any Base Pay earned but unpaid through the date of termination, any unused accrued paid time off in accordance with the applicable Company paid time off policy, any unreimbursed expenses in accordance with the Company’s expense reimbursement policy, and any accrued and vested rights or benefits under any Company sponsored employee benefits plans payable in accordance with the terms and conditions of such plans.
2.2 “Administrator” means the Company, acting through the Compensation Committee or another duly constituted committee of members of the Board, or any person to whom the Administrator has delegated any authority or responsibility with respect to the Plan pursuant to Section 10, but only to the extent of such delegation.
2.3 “Affiliate” means any Person that a Person either directly or indirectly through one or more intermediaries is in common control with, is controlled by or controls, each within the meaning of the Securities Act of 1933, as amended.
2.4 “Base Pay” means an Eligible Employee’s annualized base salary in effect immediately prior to the termination of employment. Base Pay shall not include commissions, bonuses, overtime pay, incentive compensation, benefits paid under any qualified plan, any group medical, dental or other welfare benefit plan, non-cash compensation or any other additional compensation, but shall include amounts reduced pursuant to an Eligible Employee’s salary reduction agreement under Section 125,
132(f)(4) or 401(k) of the Code, if any, or a nonqualified elective deferred compensation arrangement, if any, to the extent that in each such case the reduction is to base salary.
2.5 “Board” means the Board of Directors of the Company.
2.6 “Cause” means, with respect to an Eligible Employee, the occurrence of any of the following: (i) willful failure of an employee to perform substantially his/her duties (other than any such failure resulting from incapacity due to disability); (ii) commission of, or indictment for, a felony or any crime involving fraud or embezzlement or dishonestly or conviction of, or plea of guilty or nolo contendere to a crime or misdemeanor (other than a traffic violation) punishable by imprisonment under federal, state or local law; (iii) engagement in an act of fraud or other act of willful dishonesty or misconduct, towards the Company or any subsidiary, or detrimental to the Company or any subsidiary, or in the performance of the Eligible Employee’s duties; (iv) negligence in the performance of employment duties that has a detrimental effect on the Company or any subsidiary; (v) violation of a federal or state securities law or regulation; (vi) the use of a controlled substance without a prescription or the use of alcohol which, in each case, significantly impairs the Eligible Employee’s ability to carry out his or her duties and responsibilities; (vii) material violation of the policies and procedures of the Company or any subsidiary; (viii) embezzlement and/or misappropriation of property of the Company or any subsidiary; (ix) conduct involving any immoral acts which is reasonably likely to impair the reputation of the Company or any subsidiary; or (x) material breach of the Eligible Employee’s covenants in Section 6 of the Plan after written notice of such breach and failure by the Eligible Employee to cure such breach within 10 business days; provided, however, that no such notice of, nor opportunity to cure, such breach shall be required hereunder if the breach cannot be cured by the Eligible Employee.
2.7 “Change in Control” means the first occurrence of any of the following:
(a) An acquisition (other than directly from the Company) of any voting securities of the Company (the “Voting Securities”) by any “Person” (as the term “person” is used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than fifty percent (50%) of (i) the then-outstanding Shares or (ii) the combined voting power of the Company’s then-outstanding Voting Securities; provided, however, that in determining whether a Change in Control has occurred pursuant to this paragraph (a), the acquisition of Shares or Voting Securities in a Non-Control Acquisition (as hereinafter defined) shall not constitute a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any corporation or other Person the majority of
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the voting power, voting equity securities or equity interest of which is owned, directly or indirectly, by the Company (for purposes of this definition, a “Subsidiary”), (ii) the Company, any Principal Stockholder or any Subsidiary, or (iii) any Person in connection with a Non-Control Transaction (as hereinafter defined);
(b) The consummation of:
(i) A merger, consolidation or reorganization of a Person (x) with or into the Company or (y) in which securities of the Company are issued (a “Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger in which:
(A) the shareholders of the Company immediately before such Merger, or one or more Principal Stockholders, own directly or indirectly immediately following such Merger at least a majority of the combined voting power of the outstanding voting securities of (1) the corporation resulting from such Merger (the “Surviving Corporation”), if fifty percent (50%) or more of the combined voting power of the then outstanding voting securities by the Surviving Corporation is not Beneficially Owned, directly or indirectly, by another Person (a “Parent Corporation”) or (2) if there is one or more than one Parent Corporation, the ultimate Parent Corporation;
(B) the individuals who were members of the Board immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (1) the Surviving Corporation, if there is no Parent Corporation, or (2) if there is one or more than one Parent Corporation, the ultimate Parent Corporation; and
(C) no Person other than (1) the Company or another corporation that is a party to the agreement of Merger, (2) any Subsidiary, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to the Merger, was maintained by the Company or any Subsidiary, (4) any Person who, immediately prior to the Merger, had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Shares or Voting
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Securities, or (5) any Principal Stockholder, has Beneficial Ownership, directly or indirectly, of fifty percent (50%) or more of the combined voting power of the outstanding voting securities or common stock of (x) the Surviving Corporation, if there is no Parent Corporation, or (y) if there is one or more than one Parent Corporation, the ultimate Parent Corporation.
(ii) A complete liquidation or dissolution of the Company; or
(iii) The sale or other disposition of all or substantially all of the assets of the Company and its subsidiaries taken as a whole to any Person (other than (x) a sale or transfer to a Subsidiary or a Principal Stockholder (or one or more Principal Stockholders acting together) or (y) the distribution to the Company’s shareholders of the stock of a Subsidiary or any other assets).
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities as a result of the acquisition of Shares or Voting Securities by the Company which, by reducing the number of Shares or Voting Securities then outstanding, increases the proportional number of shares Beneficially Owned by the Subject Persons; provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Shares or Voting Securities by the Company and, after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Shares or Voting Securities and such Beneficial Ownership increases the percentage of the then outstanding Shares or Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur.
For the avoidance of doubt, following the occurrence of the first event that constitutes a Change in Control hereunder, no other Change in Control shall occur for purposes of this Plan. Notwithstanding anything herein to the contrary, no payment shall be made under Section 4.1 (in the case of a Change in Control Related Termination) or under Section 4.2 (in the case of a Change in Control Related Termination or an Involuntary Termination) unless the “Change in Control” constitutes a “change in control event” within the meaning of Code Section 409A.
2.8 “Change in Control Period” means the time period beginning on the date of the first Change in Control occurring after the Effective Date and ending on the date that is twenty-four (24) months following the date of such Change in Control.
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2.9 “Change in Control Related Termination” means a termination of the Eligible Employee’s employment by the Company or any subsidiary of the Company other than for Cause or the Eligible Employee’s resignation for Good Reason, in each case within the one hundred twenty (120) day period prior to the occurrence of a Change in Control and (A) the Company determines in good faith that such termination or the basis for resignation for Good Reason occurred in anticipation of a transaction that, if consummated, would constitute a Change in Control, (B) such termination or the basis for resignation for Good Reason occurred after the Company entered into a definitive agreement, the consummation of which would constitute a Change in Control or (C) the Company determines in good faith that such termination or the basis for resignation for Good Reason was implemented at the request of a third party who has indicated an intention or has taken steps reasonably calculated to effect a Change in Control.
2.10 “Code” means the Internal Revenue Code of 1986, as amended.
2.11 “Company” means CVR Energy, Inc., a Delaware corporation, and any successor that assumes the obligations of the Company under the Plan, by way of merger, acquisition, consolidation or other transaction.
2.12 “Compensation Committee” means the Compensation Committee of the Board.
2.13 “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of a Person, whether through the ownership of stock, by agreement or otherwise and “Controlled” has a corresponding meaning.
2.14 “Effective Date” means September 13, 2018.
2.15 “Eligible Employee” means an employee of the Company or any subsidiary of the Company who (a) has been specifically designated as eligible to participate in the Plan pursuant to notification in writing from the Administrator, (b) is a member of a select group of management or highly compensated employees and (c) has timely and properly executed and delivered a Participation Agreement to the Company. Appendix A sets forth an initial listing of employees whose positions will be eligible to participate in the Plan, provided he or she timely and properly executes a Participation Agreement.
2.16 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
2.17 “Good Reason” means, the occurrence, without an Eligible Employee’s consent, of any of the following: (a) the assignment of duties or responsibilities to the Eligible Employee that reflect a material diminution of the Eligible Employee’s position with the Company; (b) a material reduction by the Company in the Eligible Employee’s Base Pay, other than across-the-board reductions applicable to similarly situated
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employees of the Company; or (c) a relocation of the Eligible Employee’s principal place of employment to a location more than fifty (50) miles from the Company’s current headquarters in Sugar Land, Texas. In order for an event to qualify as Good Reason, (i) the Eligible Employee must not terminate employment with the Company without first providing the Company with written notice of the acts or omissions constituting the grounds for “Good Reason” within thirty (30) calendar days of the initial existence of the grounds for “Good Reason” and a reasonable cure period of thirty (30) calendar days following the date of written notice (the “Cure Period”), and such grounds must not have been cured during such time, and the Eligible Employee must resign his or her employment within the thirty (30) calendar days following the end of the Cure Period.
2.18 “Incentive / Phantom Unit Awards” means any outstanding incentive or phantom unit award, regardless of whether such awards may be settled in cash, shares, or both, granted to an Eligible Employee by the Company or its Affiliates, and any other awards approved by the Compensation Committee at the time of the award.
2.19 “Involuntary Termination” means a termination of an Eligible Employee’s employment by the Eligible Employee for Good Reason or by the Company or a subsidiary of the Company without Cause. For the avoidance of doubt, an Involuntary Termination shall not include any termination of employment by the Company or a subsidiary of the Company for Cause, due to an Eligible Employee’s death or disability or for any other reason.
2.20 “Participation Agreement” means the individual agreement (a form of which is shown in Appendix B) provided by the Administrator to an Eligible Employee under the Plan, which has been signed and accepted by the employee.
2.21 “Person” shall mean any individual, partnership, limited partnership, corporation, limited liability company, trust, foundation, estate, cooperative, association (except for any homeowners association), organization, proprietorship, firm, joint venture, joint stock company, syndicate, company, committee, government or governmental subdivision or agency, or other entity, whether or not conducted for profit.
2.22 “Principal” means Carl Icahn.
2.23 “Principal Stockholder” means any of IEP Energy LLC, any Affiliate of IEP Energy LLC, the Principal and any Related Party.
2.24 “Related Party” means (1) the Principal and his siblings, his and their respective spouses and descendants (including stepchildren and adopted children) and the spouses of such descendants (including stepchildren and adopted children) (collectively, the “Family Group”); (2) any trust, estate, partnership, corporation, company, limited liability company or unincorporated association or organization (each, an “Entity” and collectively “Entities”) Controlled by one or more members of the Family Group; (3) any Entity over which one or more members of the Family Group, directly or indirectly, have rights that, either legally or in practical effect, enable them to make or veto significant
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management decisions with respect to such Entity, whether pursuant to the constituent documents of such Entity, by contract, through representation on a board of directors or other governing body of such Entity, through a management position with such Entity or in any other manner (such rights, hereinafter referred to as “Veto Power”); (4) the estate of any member of the Family Group; (5) any trust created (in whole or in part) by any one or more members of the Family Group; (6) any individual or Entity who receives an interest in any estate or trust listed in clauses (4) or (5), to the extent of such interest; (7) any trust or estate, substantially all the beneficiaries of which (other than charitable organizations or foundations) consist of one or more members of the Family Group; (8) any organization described in Section 501(c) of the Code, over which any one or more members of the Family Group and the trusts and estates listed in clauses (4), (5) and (7) have direct or indirect Veto Power, or to which they are substantial contributors (as such term is defined in Section 507 of the Code); (9) any organization described in Section 501(c) of the Code of which a member of the Family Group is an officer, director or trustee; or (10) any Entity, directly or indirectly (a) owned or Controlled by or (b) a majority of the economic interests in which are owned by, or are for or accrue to the benefit of, in either case, any Person or Persons identified in clauses (1) through (9) above. For the purposes of this definition, and for the avoidance of doubt, in addition to any Person or Persons that may be considered to possess Control, (x) a partnership shall be considered Controlled by a general partner or managing general partner thereof, (y) a limited liability company shall be considered Controlled by a managing member of such limited liability company and (z) a trust or estate shall be considered Controlled by any trustee, executor, personal representative, administrator or any other Person or Persons having authority over the control, management or disposition of the income and assets therefrom.
2.25 “Restricted Period” means, with respect to each Eligible Employee, the twelve (12) month period following such Eligible Employee’s termination of employment for any reason or such other time period specified in the Participation Agreement.
2.26 “Section 409A Limit” means two (2) times the lesser of: (i) an Eligible Employee’s annualized compensation based upon the annual rate of pay paid to the Eligible Employee during the Eligible Employee’s taxable year preceding the Eligible Employee’s taxable year of the Eligible Employee’s termination of employment as determined under, and with such adjustments as are set forth in, Treasury Regulation Section 1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which the Eligible Employee’s employment is terminated.
2.27 “Severance Benefits” means the compensation and other benefits that an Eligible Employee is entitled to receive pursuant to Sections 4.1 and 4.2, provided that he or she is an Eligible Employee on the date he or she experiences an Involuntary Termination during the Change in Control Period.
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2.28 “Share” means the common stock, par value $.01 per share, of the Company and any other securities into which such shares are changed or for which such shares are exchanged.
3.Eligibility for Severance Benefits. An individual is eligible for Severance Benefits under the Plan, as described in Section 4, only if he or she is an Eligible Employee on the date he or she (a) experiences an Involuntary Termination during the Change in Control Period, or (b) experiences a Change in Control Related Termination.
4.Involuntary Termination During the Change in Control Period or Change in Control Termination. If, (a) during the Change in Control Period, an Eligible Employee experiences an Involuntary Termination, or (b) an Eligible Employee experiences a Change in Control Related Termination, then, in either case, subject to the Eligible Employee’s compliance with the terms and conditions of the Plan, including without limitation, Section 6, in addition to the Accrued Amounts, the Eligible Employee will be entitled to receive the following Severance Benefits from the Company:
4.1 Cash Severance Benefits. A cash severance payment, equal to the sum of (a) twelve (12) months of Base Pay, and (b) the average of the annual bonuses actually paid to the Eligible Employee during the three calendar years immediately preceding the date of the Involuntary Termination or the date of the consummation of a Change in Control in the case of a Change in Control Related Termination (or, in each case, such shorter period of time if applicable), payable in a lump sum on the Company’s first payroll date following the 60th day after (i) the date of the Involuntary Termination or (ii) the date of the consummation of a Change in Control, as applicable. In the event an Eligible Employee has no previous annual bonus history (i.e. those hired after the most recent annual bonus payout), then the annual bonus portion of the cash severance payment will be calculated based on 100% of the Eligible Employee’s current target bonus; and
4.2 Incentive / Phantom Unit Award Vesting Acceleration. Accelerated vesting as to 100% of the unvested portion of any then outstanding Incentive / Phantom Unit Awards held by the Eligible Employee, or, in the event of a Change in Control Related Termination and with respect to any Incentive / Phantom Unit Awards issued by an Affiliate of the Company, payments equivalent to the amounts the Eligible Employee would have received had any then outstanding Incentive / Phantom Unit Awards accelerated (without any duplication of vesting and/or payment), in each case, with the payout being for each then outstanding Incentive / Phantom Unit Award, a cash payment with the value calculated based on the average closing price per share of the underlying unit for the twenty (20) business days preceding the date of the Involuntary Termination or the date of the consummation of the Change in Control in the case of a Change in Control Related Termination, as applicable, provided, however, that any Incentive / Phantom Unit Awards that vest (in whole or in part) upon the achievement of performance goals shall vest as if the target level of performance had been achieved. Such payment, if any, shall be payable in a lump sum on the Company’s first payroll date
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following the 60th day after (i) the date of the Involuntary Termination or (ii) the date of the consummation of a Change in Control, as applicable.
4.3 Offset. The Severance Benefits shall be reduced (offset) by any amounts payable (i) under any statutory entitlement (including notice of termination, termination pay and/or severance pay) of the Eligible Employee upon a termination of employment, including, without limitation, any payments related to an actual or potential liability under the Worker Adjustment and Retraining Notification Act (WARN) or similar state or local law, and (ii) pursuant to any agreement between the Eligible Employee and the Company or any of its Affiliates.
5.Effect of Section 280G of the Code.
5.1 Payment Reduction. Notwithstanding anything contained herein to the contrary, (i) to the extent that any payment or distribution of any type to or for the benefit of an Eligible Employee by the Company, any Affiliate of the Company, any Person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets (within the meaning of Section 280G of the Code and the regulations thereunder), or any Affiliate of such Person, whether paid or payable or distributed or distributable pursuant to the terms of the Plan or otherwise (the “Payments”) constitutes “parachute payments” (within the meaning of Section 280G of the Code), and if (ii) such aggregate Payments would, if reduced by all federal, state and local taxes applicable thereto, including the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), be less than the amount the Eligible Employee would receive, after all taxes, if the Eligible Employee received aggregate Payments equal (as valued under Section 280G of the Code) to only three times the Eligible Employee’s “base amount” (within the meaning of Section 280G of the Code), less $1.00, then (iii) such Payments shall be reduced (but not below zero) if and to the extent necessary so that no Payments to be made or benefit to be provided to the Eligible Employee shall be subject to the Excise Tax. If the Payments are so reduced, the Company shall reduce or eliminate the Payments (x) by first reducing or eliminating the portion of the Payments which are not payable in cash (other than that portion of the Payments subject to clause (z) hereof), (y) then by reducing or eliminating cash payments (other than that portion of the Payments subject to clause (z) hereof) and (z) then by reducing or eliminating the portion of the Payments (whether payable in cash or not payable in cash) to which Treasury Regulation Section 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.
5.2 Determination of Amount of Reduction (if any). The determination of whether the Payments shall be reduced as provided in Section 5.1 hereof and the amount of such reduction shall be made at the Company’s expense by a nationally-recognized accounting firm selected by the Company (the “Accounting Firm”). The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation, to the Company and the Eligible Employee
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within 10 calendar days after the Eligible Employee’s final day of employment. If the Accounting Firm determines that no Excise Tax is payable by the Eligible Employee with respect to the Payments, it shall furnish the Eligible Employee with an opinion reasonably acceptable to the Eligible Employee that no Excise Tax will be imposed with respect to any such payments and, absent manifest error, such Determination shall be binding, final and conclusive upon the Company and the Eligible Employee.
6.Conditions to Receipt and Retention of Severance Benefits. Each Eligible Employee is required to comply with all the terms and conditions set forth in this Section 6 in order to receive Severance Benefits under the Plan.
6.1 Release Agreement. As a condition to receiving the Severance Benefits under the Plan, each Eligible Employee will be required to sign and not revoke a separation and release of claims agreement in a form provided to such Eligible Employee, which will be provided by the Company within five (5) calendar days following the Involuntary Termination date (the “Release”). In all cases, the Release must become effective and irrevocable under applicable law no later than the sixtieth (60th) calendar day following the Eligible Employee’s Involuntary Termination. If the Release does not become effective and irrevocable by such 60th calendar day, the Eligible Employee will immediately forfeit any and all rights to the Severance Benefits. For the avoidance of doubt, in no event will the Severance Benefits be paid or provided until the Release becomes effective and irrevocable.
6.2 Confidentiality and Non-Disparagement.
6.2.1 During the term of an Eligible Employee’s employment with the Company or any of its Affiliates and at all times thereafter, the Eligible Employee shall hold in a fiduciary capacity for the benefit of the Company and each of its Affiliates, all secret or confidential information, knowledge or data, including, without limitation, technical information, intellectual property, business and marketing plans, strategies, customer information and lists, software, trade secrets, sources of supplies and materials, designs, production and design techniques and methods, identity of investments, identity of contemplated investments, business opportunities, valuation models and methodologies, processes, technologies, and any other intellectual property relating to the business, or other information concerning the products, promotions, development, financing, expansion plans, business policies and practices, of the Company and each of its Affiliates, and their respective businesses, and other forms of information considered by the Company and its Affiliates to be confidential and in the nature of trade secrets (i) obtained by the Eligible Employee during the Eligible Employee’s employment by the Company or any of its Affiliates and/or during any period of time in which the Eligible Employee has access to email and/or information technology services from the Company, and (ii) not otherwise in the public domain (collectively, “Confidential Information”).
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6.2.2 Each Eligible Employee must keep confidential and not to publish, post on his or her own or to disclose any personal information regarding any controlling Person of the Company (or any of its Affiliates), including, without limitation, Carl C. Icahn, or any of his Affiliates and their respective employees, and any member of the immediate family of any such Person (and all such personal information shall be deemed “Confidential Information” for the purposes of the Plan). Each Eligible Employee shall not, without the prior written consent of the Company (acting at the direction of the Board): (i) except to the extent compelled pursuant to the order of a court or other body having jurisdiction over such matter or based upon the advice of counsel that such disclosure is legally required, communicate or divulge any Confidential Information to anyone other than the Company and those designated by the Company; or (ii) use any Confidential Information for any purpose other than the performance of his or her duties pursuant to such Eligible Employee’s employment with the Company or any of its Affiliates. Each Eligible Employee will assist the Company or its designee, at the Company’s expense, in obtaining a protective order, other appropriate remedy or other reliable assurance that confidential treatment will be accorded any Confidential Information disclosed pursuant to the terms of the Plan. Each Eligible Employee agrees not to disparage the Company, its officers and directors, Mr. Icahn, any Related Parties, or any Affiliate of any of the foregoing, in each case during and/or after such Eligible Employee’s employment with the Company or any of its Affiliates. Without limiting anything contained above, each Eligible Employee agrees and acknowledges that all personal and not otherwise public information about the Company and its Affiliates (including, without limitation, all information regarding Icahn Enterprises L.P. (“IEP”), Carl C. Icahn, Mr. Icahn’s family, and employees of the Company, IEP and their respective Affiliates) shall constitute Confidential Information for purposes of the Plan.
6.2.3 Each Eligible Employee must not write, contribute to, or assist any other person in writing or creating, a book, film, broadcast, article, blog or any other publication (whether in print, electronic or any other form) about or concerning, in whole or in part, the Company, IEP, Mr. Icahn and his family members or any of the respective Affiliates and subsidiaries of any of the foregoing (as applicable), in any media, and not to publish or cause to be published in any media, any Confidential Information, and must keep confidential and not to disclose to any third party, including, but not limited to, newspapers, authors, publicists, journalists, bloggers, gossip columnists, producers, directors, script writers, media personalities, and the like, in any and all media or communication methods, any Confidential Information. In furtherance of the foregoing, following the termination of the Eligible Employee’s employment with the Company or any of its Affiliates, the sole and only disclosure or statement the Eligible Employee shall be permitted to make about or concerning any or all of the Company, IEP, Mr. Icahn and his family members or any of the respective Affiliates and subsidiaries of any of the foregoing (as applicable) is to
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acknowledge that the Eligible Employee is or was employed by the Company (unless otherwise required by applicable law).
6.3 Non-Competition and Non-Solicitation. As a condition of receiving the Severance Benefits under the Plan, and in order to protect Confidential Information, each Eligible Employee will not, either directly or indirectly, during the Restricted Period:
6.3.1 own, manage, operate, join, control, be employed by, or participate in the ownership, management, operation or control of, or be connected in any manner with, including, without limitation, holding any position as a principal, agent, owner, stockholder, director, officer, consultant, advisor, independent contractor, employee, partner, or investor in, any Restricted Enterprise (as defined below); provided, that in no event shall ownership of one percent (1%) or less of the outstanding securities of any class of any issuer whose securities are registered under the Exchange Act, standing alone, be prohibited by this Section 6.3, so long as the Eligible Employee does not have, or exercise, any rights to manage or operate the business of such issuer other than rights as a stockholder thereof. For purposes of this paragraph, “Restricted Enterprise” shall mean any Person that is actively engaged in any business which is either (i) in competition with the business of the Company or any of its Affiliates conducted during the six months preceding the Eligible Employee’s Involuntary Termination, or (ii) proposed to be conducted by the Company or any of its Affiliates in the Company’s or Affiliate’s business plan as in effect at the time of the Eligible Employee’s Involuntary Termination; provided, that a Restricted Enterprise shall only include such a Person that primarily operates within the States of Kansas, Oklahoma or Texas or any other state where the Company or any of its subsidiaries conducts business operations. During the Restriction Period, upon request of the Company, the Eligible Employee shall notify the Company of the Eligible Employee’s then-current employment status. For the avoidance of doubt, a Restricted Enterprise shall not include any Person or division thereof that is engaged in the business of supplying (but not refining) crude oil or natural gas;
6.3.2 solicit (or assist any Person to solicit) for employment any person who is, or within six months prior to the date of such solicitation was, an employee of the Company or any of its Affiliates, provided, however, that this Section 6.3 shall not prohibit the hiring of any individual as a result of the individual’s response to an advertisement in a publication of general circulation; and
6.3.3 (i) solicit, interfere with or entice away from the Company or any of its Affiliates, any current supplier, customer or client, (ii) direct or solicit any current supplier, customer or client away from the Company or any of its Affiliates, or (iii) advise any Person not to do business with, or be employed by the Company or any of its Affiliates.
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6.4 Severability. The covenants contained in Section 6 shall be construed as a series of separate covenants, one for each city, county and state of any geographic area. Except for geographic coverage, each such separate covenant shall be deemed identical in terms to the covenant contained in subsections 6.2 and 6.3 above. If, in any judicial or arbitration proceeding, a court or arbitrator refuses to enforce any of such separate covenants (or any part thereof), then such unenforceable covenant (or such part) shall be eliminated from the Plan to the extent necessary to permit the remaining separate covenants (or portions thereof) to be enforced. In the event the provisions of subsection 6.2 or 6.3 above are deemed to exceed the time, geographic, or scope limitations permitted by applicable law, then such provisions shall be reformed by the court or arbitrator to cover the maximum time, geographic, or scope limitations, as the case may be, then permitted by such law.
6.5 Other Requirements. An Eligible Employee’s receipt and retention of the Severance Benefits will be subject to the Eligible Employee continuing to comply with the provisions of this Section 6 and the terms of any other confidentiality, proprietary information and inventions agreement, including any non-competition and non-solicitation covenants contained therein (which are additional obligations, and not replaced by the provisions of this Section 6), and such other appropriate agreements between the Eligible Employee and the Company. In the event an Eligible Employee fails to comply with his or her obligations or breaches any covenant or other agreement under this Section 6 or such other appropriate agreements between the Eligible Employee and the Company, (i) such Eligible Employee shall not be entitled to receive and/or retain the Severance Benefits and shall be required to immediately repay to the Company all Severance Benefits previously paid to him or her under the Plan and forfeit all unpaid Severance Benefits (if any) that remain payable to him or her under the Plan, (ii) the Company shall have the right to fully recover from such Eligible Employee all Severance Benefits paid to him or her under the Plan, and (iii) such Eligible Employee agrees not to assert any defenses, rights of set-off or counterclaims as a reason for not repaying such amount under subsections (i) and (ii).
7.Non-Duplication of Benefits; Survival of Other Benefits. Notwithstanding any other provision in the Plan to the contrary, if an Eligible Employee is entitled to any severance, change in control or similar benefits outside of the Plan by operation of applicable law or under another Company-sponsored plan, policy, contract, or arrangement, his or her benefits under the Plan will be reduced by the value of the severance, change in control or similar benefits that the Eligible Employee receives by operation of applicable law or under any Company-sponsored plan, policy, contract, or arrangement, all as determined by the Administrator in its discretion. Subject to the foregoing, the Plan is not intended to amend, modify, terminate, or supersede any severance, change in control or similar benefits provided under any contract with any Eligible Employee, and to the extent any such contract offers severance, change in control or similar benefits that are more advantageous to the Eligible Employee than the terms hereof, such Eligible Employee shall continue to be entitled to such benefits.
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8.Section 409A.
8.1 Notwithstanding anything to the contrary in the Plan, no severance payments or benefits to be paid or provided to an Eligible Employee, if any, under the Plan that, when considered together with any other severance payments or separation benefits, are considered deferred compensation under Section 409A of the Code, and the final regulations and any guidance promulgated thereunder (“Section 409A”) (together, the “Deferred Payments”) will be paid or provided until the Eligible Employee has a “separation from service” within the meaning of Section 409A. Similarly, no severance payable to an Eligible Employee, if any, under the Plan that otherwise would be exempt from Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(9) will be payable until the Eligible Employee has a “separation from service” within the meaning of Section 409A.
8.2 It is intended that none of the severance payments or benefits under the Plan will constitute Deferred Payments but rather will be exempt from Section 409A as a payment that would fall within the “short-term deferral period” as described in Section 8.4 below or resulting from an involuntary separation from service as described in Section 8.5 below. In no event will an Eligible Employee have discretion to determine the taxable year of payment of any Deferred Payment.
8.3 Notwithstanding anything to the contrary in the Plan, if an Eligible Employee is a “specified employee” within the meaning of Section 409A at the time of the Eligible Employee’s separation from service (other than due to death), then the Deferred Payments, if any, that are payable within the first six (6) months following the Eligible Employee’s separation from service, will become payable on the date six (6) months and one (1) day following the date of the Eligible Employee’s separation from service. Notwithstanding anything herein to the contrary, in the event of the Eligible Employee’s death following the Eligible Employee’s separation from service, but before the six (6) month anniversary of the separation from service, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of the Eligible Employee’s death. Each payment and benefit payable under the Plan is intended to constitute a separate payment under Section 1.409A-2(b)(2) of the Treasury Regulations.
8.4 Any amount paid under the Plan that satisfies the requirements of the “short-term deferral” rule set forth in Treasury Regulation Section 1.409A-1(b)(4) will not constitute Deferred Payments for purposes of Section 8.1 above.
8.5 Any amount paid under the Plan that qualifies as a payment made as a result of an involuntary separation from service pursuant to Treasury Regulation Section 1.409A-1(b)(9)(iii) that does not exceed the Section 409A Limit will not constitute Deferred Payments for purposes of Section 8.1 above.
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8.6 The foregoing provisions are intended to comply with or be exempt from the requirements of Section 409A so that none of the payments and benefits to be provided under the Plan will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply or be exempt. Notwithstanding anything to the contrary in the Plan, including but not limited to Sections 10 and 13, the Company reserves the right to amend the Plan as it deems necessary or advisable, in its sole and absolute discretion and without the consent of an Eligible Employee, to comply with Section 409A or to avoid income recognition under Section 409A prior to the actual payment of benefits under the Plan or imposition of any additional tax. In no event will the Company reimburse an Eligible Employee for any taxes that may be imposed on the Eligible Employee as result of Section 409A.
9.Withholdings. The Company will withhold from any payments or benefits under the Plan all applicable U.S. federal, state, local and non-U.S. taxes required to be withheld and any other required payroll deductions.
10.Administration. The Plan will be administered and interpreted by the Administrator (in its sole and absolute discretion). Any decision made or other action taken by the Administrator with respect to the Plan, and any interpretation by the Administrator of any term or condition of the Plan, or any related document, will be conclusive and binding on all persons and be given the maximum possible deference allowed by law. In accordance with Section 2.2, the Administrator (a) may, in its sole and absolute discretion and on such terms and conditions as it may provide, delegate in writing to one or more officers of the Company all or any portion of its authority or responsibility with respect to the Plan, and (b) has the authority to act for the Company (in a non-fiduciary capacity) as to any matter pertaining to the Plan; provided, however, that any Plan amendment or termination or any other action that reasonably could be expected to increase materially the cost of the Plan must be approved by the Board.
11.Eligibility to Participate. To the extent that the Administrator has delegated administrative authority or responsibility to one or more officers of the Company in accordance with Sections 2.2 and 10, each such officer will not be excluded from participating in the Plan if otherwise eligible, but he or she is not entitled to act upon or make determinations regarding any matters pertaining specifically to his or her own benefit or eligibility under the Plan. The Administrator will act upon and make determinations regarding any matters pertaining specifically to the benefit or eligibility of each such officer under the Plan.
12.Term. The Plan will become effective upon the Effective Date. In the event that, during any period prior to termination of this Plan (the “End Date”), (i) a Change in Control occurs, or (ii) the Company enters into a definitive agreement which, if consummated, would result in a Change in Control (“Potential Change in Control”), and such Potential Change in Control results in a Change in Control, the Plan will terminate automatically upon the completion of all payments (if any) under the terms of the Plan. In the event that, a Potential Change in Control is pending as of the End Date and is subsequently abandoned (as publicly announced by the Company), the Plan will terminate automatically effective as of the date that such Potential Change in Control is abandoned.
15
13.Amendment or Termination. The Company, by action of the Administrator, reserves the right to amend or terminate the Plan at any time, without advance notice to any Eligible Employee and without regard to the effect of the amendment or termination on any Eligible Employee or on any other individual. Any amendment or termination of the Plan will be in writing. Notwithstanding the foregoing, during the pendency of a Potential Change in Control and on and following a Change in Control, the Company may not, without an Eligible Employee’s written consent, amend or terminate the Plan in any way, nor take any other action, that (i) prevents that Eligible Employee from becoming eligible for the Severance Benefits under the Plan, or (ii) reduces or alters to the detriment of the Eligible Employee the Severance Benefits payable, or potentially payable, to an Eligible Employee under the Plan (including, without limitation, imposing additional conditions).
14.Claims and Appeals.
14.1 Claims Procedure. Any Eligible Employee or other person who believes he or she is entitled to any payment under the Plan may submit a claim in writing to the Administrator within ninety (90) calendar days of the earlier of (i) the date the claimant learned the amount of his or her benefits under the Plan or (ii) the date the claimant learned that he or she will not be entitled to any benefits under the Plan. If the claim is denied (in full or in part), the claimant will be provided a written notice explaining the specific reasons for the denial and referring to the provisions of the Plan on which the denial is based. The notice also will describe any additional information needed to support the claim and the Plan’s procedures for appealing the denial. The denial notice will be provided within ninety (90) calendar days after the claim is received. If special circumstances require an extension of time (up to ninety (90) calendar days), written notice of the extension will be given within the initial ninety (90) day period. This notice of extension will indicate the special circumstances requiring the extension of time and the date by which the Administrator expects to render its decision on the claim.
14.2 Appeal Procedure. If the claimant’s claim is denied, the claimant (or his or her authorized representative) may apply in writing to the Administrator for a review of the decision denying the claim. Review must be requested within sixty (60) calendar days following the date the claimant received the written notice of their claim denial or else the claimant loses the right to review. The claimant (or representative) then has the right to review and obtain copies of all documents and other information relevant to the claim, upon request and at no charge, and to submit issues and comments in writing. The Administrator will provide written notice of its decision on review within sixty (60) calendar days after it receives a review request. If additional time (up to sixty (60) calendar days) is needed to review the request, the claimant (or representative) will be given written notice of the reason for the delay. This notice of extension will indicate the special circumstances requiring the extension of time and the date by which the Administrator expects to render its decision. If the claim is denied (in full or in part), the claimant will be provided a written notice explaining the specific reasons for the denial and referring to the provisions of the Plan on which the denial is based. The notice also will include a statement that the claimant will be provided, upon request and free of
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charge, reasonable access to, and copies of, all documents and other information relevant to the claim and a statement regarding the claimant’s right to bring an action under Section 502(a) of ERISA.
15.Attorneys’ Fees. The parties shall each bear their own expenses, legal fees and other fees incurred in connection with the Plan.
16.Source of Payments. All Severance Benefits will be paid in cash from the general funds of the Company; no separate fund will be established under the Plan, and the Plan will have no assets. No right of any person to receive any payment under the Plan will be any greater than the right of any other general unsecured creditor of the Company.
17.Inalienability. In no event may any current or former employee of the Company or any of its subsidiaries or affiliates sell, transfer, anticipate, assign or otherwise dispose of any right or interest under the Plan. At no time will any such right or interest be subject to the claims of creditors nor liable to attachment, execution or other legal process.
18.No Enlargement of Employment Rights. Neither the establishment or maintenance or amendment of the Plan, nor the making of any benefit payment hereunder, will be construed to confer upon any individual any right to continue to be an employee of the Company. The Company expressly reserves the right to discharge any of its employees at any time, with or without cause. However, as described in the Plan, an Eligible Employee may be entitled to benefits under the Plan depending upon the circumstances of his or her termination of employment.
19.Successors. Any successor to the Company of all or substantially all of the Company’s business and/or assets (whether direct or indirect and whether by purchase, merger, consolidation, liquidation or other transaction) will assume the obligations under the Plan and agree expressly to perform the obligations under the Plan in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under the Plan, the term “Company” will include any successor to the Company’s business and/or assets which become bound by the terms of the Plan by operation of law, or otherwise.
20.Applicable Law. The provisions of the Plan will be construed, administered and enforced in accordance with ERISA and, to the extent applicable, the internal substantive laws of the state of New York (but not its conflict of laws provisions).
21.Severability. If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability will not affect any other provision of the Plan, and the Plan will be construed and enforced as if such provision had not been included.
22.Headings. Headings in the Plan document are for purposes of reference only and will not limit or otherwise affect the meaning hereof.
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Appendix A
CVR Energy, Inc. Change in Control and Severance Plan
CVR Energy, Inc. Change in Control and Severance Plan
Eligible Employees
Note: Non-material updates to titles of Eligible Employees permissible
upon approval of the CEO of CVR Energy, Inc.
Executive Vice President & Chief Financial Officer
Executive Vice President & Chief Commercial Officer
President and CEO – CVR Partners & Executive Vice President – Corporate Services
Executive Vice President, General Counsel & Secretary
Executive Vice President & Chief Operating Officer
Vice President, Chief Accounting Officer and Corporate Controller
Vice President Tax
Vice President Finance
Sr. Vice President Marketing and Feedstocks
Sr. Vice President Crude
Vice President IT & Chief Information Officer
Sr. Vice President Human Resources
Vice President & Associate General Counsel
Vice President Internal Audit
Sr. Vice President Capital Projects
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Appendix B
CVR Energy, Inc. Change in Control and Severance Plan
Form of Participation Agreement
CVR Energy, Inc. Change in Control and Severance Plan
Form of Participation Agreement
CVR Energy, Inc. (the “Company”) is pleased to inform you, ______________________, that you have been selected to participate in the Company’s Change in Control and Severance Plan, as may be amended from time to time (the “Plan”). A copy of the Plan was delivered to you with this Participation Agreement. Your participation in the Plan is subject to all of the terms and conditions of the Plan.
In order to become a participant in the Plan (an “Eligible Employee” as described in the Plan), you must complete and sign this Participation Agreement and return it to [NAME] no later than [DATE].
The Plan describes in detail certain circumstances under which you may become eligible for Severance Benefits. As described more fully in the Plan, you may become eligible for certain Severance Benefits under Sections 4.1 and 4.2 of the Plan if, during the Change in Control Period, you experience an Involuntary Termination (as defined in the Plan), or if you experience a Change In Control Related Termination.
In order to receive and/or retain any Severance Benefits for which you otherwise become eligible under the Plan, you must sign and deliver to the Company the Release, which must have become effective and irrevocable within the requisite period, and you must also adhere to the confidentiality, non-disparagement, non-competition and non-solicitation provisions of the Plan as set forth in the Plan. Also, as explained in the Plan, your Severance Benefits (if any) may be reduced under certain circumstances, if necessary, to avoid your Severance Benefits from becoming subject to “golden parachute” excise taxes under the Internal Revenue Code.
By your signature below, you and the Company agree that your participation in the Plan is governed by this Participation Agreement and the provisions of the Plan. Your signature below confirms that: (1) you have received a copy of the Change in Control and Severance Plan; (2) you have carefully read this Participation Agreement and the Change in Control and Severance Plan; (3) you agree to comply with the restrictive covenants set forth in Sections 6.2 and 6.3 of the Plan and the terms of any other confidentiality, proprietary information and inventions agreement, including any non-competition and non-solicitation covenants contained therein; and (4) decisions and determinations by the Administrator under the Plan will be final and binding on you and your successors.
[Signature Page Follows]
CVR ENERGY, INC. | [ELIGIBLE EMPLOYEE NAME] | ||||
Signature | Signature | ||||
Name | Date | ||||
Title | |||||
Attachment: CVR Energy, Inc. Change in Control and Severance Plan
[Signature Page to the Participation Agreement]
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Exhibit 10.8
CVR Energy, Inc. and Subsidiaries
2025 Performance-Based Bonus Plan - Refining
Philosophy / Background
CVR Energy, Inc. (“CVI”) and its applicable subsidiaries (collectively, the “Company”) are committed to wages and benefits that are competitive with a market-based, pay-for-performance compensation philosophy, providing such base pay, bonus and long-term incentive awards in line with those of the refining industry. This CVR Energy, Inc. and Subsidiaries 2025 Performance-Based Bonus Plan – Refining (the “Plan”) is intended to reward high performance employees, and to retain these employees in critical roles, through the issuance of bonus awards (each, a “Bonus”).
Administration
The Plan is maintained and administered by, or under the direction of, the Compensation Committee (the "Compensation Committee") of the board of directors (the “Board”) of CVR Energy, Inc. with respect to, and references to “employee” herein relate only to, eligible employees or officers of the Company and its subsidiaries, excluding any employees of (or individuals solely subject to the bonus plans of) CVI relating to Corporate or CVR Partners, LP (“UAN”) and, with respect to UAN, its general partner and subsidiaries relating to Fertilizer.
The Compensation Committee shall annually approve all salaries, targets and bonus metrics for employees who serve as Executive Officers (defined below) and shall annually approve a total bonus pool for all other eligible employees (“Non-Executive Employees”). The Compensation Committee delegates to the Chief Executive the authority to approve payouts from such total bonus pool to Non-Executive Employees, in his or her sole discretion. The Chief Executive shall also be responsible for assigning salaries, bonus targets, and Grade levels to Non-Executive Employees.
In the event of a claim or dispute brought forth by any Non-Executive Employee, the decision of the Chief Executive as to the facts in the case and the meaning and intent of any provision of the Plan, or its application, shall be final, binding, and conclusive. In the event of a claim or dispute brought forth by any Executive Officer, the decision of the Compensation Committee as to the facts in the case and the meaning and intent of any provision of the Plan, or its application, shall be final, binding, and conclusive.
The Plan described herein does not create a contractual obligation on the part of the Company. The Company expressly reserves the right to modify, discontinue, or otherwise change the Plan outlined in this document at the sole and absolute discretion of the Company without advance notice.
Introduction
The purpose of the Plan and any Bonus to be paid hereunder is to enhance the Company’s ability to attract, motivate, reward and retain employees, and to strengthen their commitment to the success of the Company.
Eligibility and Administration
Bonuses are made based on the applicable calendar year during which the employees performed the services and are generally paid (to the extent payable) after the financials have been audited and within 90 days of the end of the calendar year (the “Performance Period” or “Period”).
Refining Bonus Plan Approved April 29, 2025 Page 1
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Generally, only exempt, non-exempt and non-union hourly employees are eligible to receive a Bonus, provided that, to receive a Bonus, an employee must: (i) be actively employed with the Company for at least 90 days during the calendar year; (ii) consistently perform at or above expectations for their role; (iii) be actively employed on the date of payout and not on a performance improvement plan or in corrective or disciplinary action status as a result of poor performance during the Performance Period. Employees hired prior to October 1 during the Performance Period will be eligible to receive a Bonus provided the above requirements (ii) and (iii) are met.
Subject to annual review, Bonuses are computed in accordance with each eligible employee’s Grade (as shown in Appendix A), prorated for time in an eligible position, as well as a performance multiplier of zero to 150 percent, based on performance against the achievement of the allocated Company and individual performance measures described herein. Appendices A-H present: the overall compensation structure (Appendix A), example calculations (Appendices B, C), eligibility (Appendix D), bonus payout measures (Appendix E), EBITDA multipliers (Appendix F), definitions (Appendix G), and Clawback and Recoupment Policy (Appendix H). In addition, if Adjusted EBITDA for a given Performance Period is less than 50% of the Adjusted EBITDA Threshold established for the Company, no Bonus will be paid for the Period, subject to Compensation Committee discretion. If Adjusted EBITDA is at least 50% of the Adjusted EBITDA Threshold established for the Company, an EBITDA Multiplier between 50% and 150% will be applied to the Company performance measures based on the Adjusted EBITDA achieved for a given Performance Period relative to the Adjusted EBITDA Threshold, with a 50% Adjusted EBITDA Threshold achievement earning a 50% multiplier and an Adjusted EBITDA Threshold achievement of 400% or more earning a 150% multiplier. Appendix F further describes the range of EBITDA multipliers based on various Adjusted EBITDA Threshold achievements. The Compensation Committee may, in its sole and absolute discretion, waive the Adjusted EBITDA Threshold requirement, increase, decrease, or otherwise adjust performance measures, targets, and payout ranges used hereunder, as a result of extraordinary or non-recurring events, changes in applicable accounting rules or principles, changes in the Company’s methods of accounting, changes in applicable law, changes due to consolidations, growth capital spend programs, acquisitions, or reorganizations affecting the Company and its subsidiaries and affiliates, or other similar changes in the Company’s business.
The Individual Performance Multiplier component of a Bonus, if any, is entirely discretionary.
Company Performance: Environmental Health & Safety (EH&S) Measures – 25%
EH&S measures are as follows (see Appendix G for definitions):
•Personal Safety – Total Recordable Injury Rate (TRIR);
•Process Safety – Process Safety Tier I Incident Rate (PSIR); and
•Environmental Events (EE).
Company Performance: Financial Measures – 75%
Financial measures are objectives related to the following (see Appendix F for definitions):
•Reliability;
•Equipment Utilization;
•Operating Expense; and
•Return on Capital Employed.
Refining Bonus Plan Approved April 29, 2025 Page 2
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Spot Bonus
Introduction
Employees making an extraordinary contribution to the furtherance of Company financial performance or advances in Company culture may be nominated by their manager or executive sponsor for a Bonus on a spot basis (a “Spot Bonus”), subject to approval by the Chief Executive. Spot Bonuses will be limited to employees in salary grades E12 and below and a maximum value of five thousand dollars ($5,000).
Terms and Conditions of Spot Bonus
Except as specifically set forth herein, all of the provisions of this Plan will likewise apply to a Spot Bonus. For the avoidance of doubt, these provisions relate to, among others, forfeiture and/or recoupment, amendment or termination, tax withholding, data protection and consent and governing law.
General Provisions
See Appendix G for definitions relating to the Plan.
Participation in the Plan is subject to (i) each individual employee’s compliance with the Company’s mission and values, its code of ethics and its policies and procedures, including, without limitation, the Corporate Policies and Procedures and employee handbook (collectively, “Company Policies”), and (ii) the Clawback and Recoupment Policy attached as Appendix H.
Each employee that is eligible and receives a Bonus or Spot Bonus will be liable for any and all federal, state, provincial, local or foreign taxes, pension plan contributions, employment insurance premiums, social insurance contributions, amounts payable to a governmental and/or regulatory body in the employee’s country and other levies of any kind required by applicable laws to be deducted or withheld with respect to any such award (collectively, the “Withholding Taxes”). The Company will have the right to deduct and withhold all required Withholding Taxes from any payment or other consideration deliverable to an employee pursuant to any such payment. All awards under the Plan are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and shall be construed and interpreted in accordance with such intent.
Participation in the Plan does not confer upon any employee any right to continue in the employ of the Company or its subsidiaries, nor interfere in any way with the right of the Company and its subsidiaries to terminate any employee’s employment at any time. The Company and its subsidiaries are under no obligation to continue the Plan in future years.
The Compensation Committee may at any time, or from time to time, in its sole and absolute discretion, (a) amend, alter or modify the provisions of this Plan, (b) terminate this Plan, or (c) terminate the participation of an employee or group of employees in this Plan; provided, however, that in the event of the termination of the Plan or a termination of participation, the Compensation Committee, in its sole and absolute discretion, may determine that a prorated award is payable to employees who were participants in this Plan under such terms and conditions as established by the Compensation Committee.
Notwithstanding anything herein to the contrary, whether or not any payment or award is authorized, earned or paid under the Plan will be determined by the Compensation Committee in its sole and absolute discretion, and no such payment or award shall be earned, nor shall any right to any such payment or award exist or accrue, unless, among other factors, such payment or award has been
Refining Bonus Plan Approved April 29, 2025 Page 3
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
authorized by the Compensation Committee in its sole and absolute discretion, and actually paid to the employee. In addition, whether or not any payment or award is authorized, earned or paid pursuant to the Plan is without regard to whether any of the individual performance metrics, financial performance targets and/or goals, or any other benchmarks, targets, personal goals or criteria set forth in the Plan are met, not met, exceeded or not exceeded.
No employee, beneficiary or other person shall have any right, title or interest in any amount awarded under the Plan prior to the payment of such award to him or her. An employee’s rights to a payment under the Plan are no greater than those of unsecured general creditors of the Company or its subsidiaries.
By participating in the Plan, each employee consents to the holding and processing of personal information provided by such employee to the employer, any affiliate of the employer, trustee or third party service provider, for all purposes relating to the operation of the Plan. Consents include, but are not limited to: (i) administering and maintaining employee records; (ii) providing information to the employer, its affiliates, trustees of any employee benefit trust, registrars, brokers or third party administrators of the Plan; (iii) providing information to future purchasers or merger partners of the employer or any of its affiliates, or the business in which the employee works; and (iv) to the extent not prohibited by applicable law, transferring information about the employee to any country or territory that may not provide the same protection for the information as the employee’s home country.
The Plan is governed by the laws of the State of New York and as such will be construed under and in accordance with the laws of the State of New York without regard to conflicts of law.
Refining Bonus Plan Approved April 29, 2025 Page 4
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix A
Compensation Structure: Base Pay & Incentive Plans
[***]
Individual Performance Measures
Supervisor’s assessment of employee’s performance will be based on the following categories:
•Interpersonal effectiveness
•Business conduct
•Professional and technical development
•Leadership
•Achievement of goals
•Results orientation
The assessment is discretionary and based on a wide range of considerations which often change over the course of the year.
Refining Bonus Plan Approved April 29, 2025 Page 5
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix B
Bonus Payout and Company Performance Calculations
Bonus Payout Calculation:
Refining Bonus Plan Approved April 29, 2025 Page 6
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix C
Bonus Payout Examples
Refining Bonus Plan Approved April 29, 2025 Page 7
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix D
Refining Plan Eligibility
Non-union direct employees of Company and its subsidiaries (other than Executive Officers), including employees working in Pipeline, Trucking, Marketing, Crude, Renewables, Planning, Wholesale, Wynnewood and Coffeyville refineries and Capital Projects, and any employee of any affiliated entity, in each case, deemed by the Chief Executive in his or her sole discretion to be solely dedicated to Refining, but excluding anyone not an eligible employee as described in the Plan.
Refining Bonus Plan Approved April 29, 2025 Page 8
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix E
Refining
Bonus Payout (Performance) Measures
Environmental Health & Safety (EH&S) Measures (25%)
Three measures evenly weighted (33-1/3% each): Total Recordable Injury Rate (TRIR), Process Safety Tier I Incident Rate (PSIR), and Environmental Events (EE):
| Percentage Change (over the prior year) | Bonus Achievement | |||||||
| Increase in TRIR, PSIR, or EE | Zero | |||||||
| 0% | 50% of Target Percentage (Threshold) | |||||||
| Decrease > 0% and < 3% | Linear Interpolation between Threshold and Target | |||||||
| Decrease of 3% | Target Percentage | |||||||
| Decrease > 3% and < 10% | Linear Interpolation between Target and Maximum | |||||||
Decrease of 10% or more, or if TRIR is maintained at or below 1.0, PSIR at or below 0.2 and EE at or below 20 | 150% of Target (Maximum) | |||||||
Financial Measures (75%)
Four measures evenly weighted (25% each):
| Reliability | Bonus Achievement | |||||||
| Greater than 7.0% | Zero | |||||||
| 7.00% | 50% of Target Percentage (Threshold) | |||||||
| 5.51% to 6.99% | Linear Interpolation between Threshold and Target | |||||||
| 5.5% | Target Percentage | |||||||
| 4.0% to 5.49% | Linear Interpolation between Target and Maximum | |||||||
| Less than 4.0% | 150% of Target (Maximum) | |||||||
| Equipment Utilization | Bonus Achievement | |||||||
| Less than 95% | Zero | |||||||
| 95% | 50% of Target Percentage (Threshold) | |||||||
| 95.01% to 99.99% | Linear Interpolation between Threshold and Target | |||||||
| 100% | Target Percentage | |||||||
| 100.01% to 104.99% | Linear Interpolation between Target and Maximum | |||||||
| Greater than 105% | 150% of Target (Maximum) | |||||||
| Operating Expense | Bonus Achievement | |||||||
| Greater than 105.0% | Zero | |||||||
| 105% | 50% of Target Percentage (Threshold) | |||||||
| 100.1% to 104.99% | Linear Interpolation between Threshold and Target | |||||||
| 100% | Target Percentage | |||||||
| 95.0% to 99.99% | Linear Interpolation between Target and Maximum | |||||||
| Less than 95% | 150% of Target (Maximum) | |||||||
Refining Bonus Plan Approved April 29, 2025 Page 9
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
| Refining ROCE (Ranking vs. Peer Group*) | Bonus Achievement | |||||||
| First (highest) | 150% of Target (Maximum) | |||||||
| Second | 125% of Target Percentage | |||||||
| Third | 112.5% of Target Percentage | |||||||
| Fourth | Target Percentage (100%) | |||||||
| Fifth | 50% of Target Percentage | |||||||
| Six | Zero | |||||||
| Seventh | Zero | |||||||
Bonus Payout Measures subject to peer group ranking will be based on LTM data as of September 30 of the Performance Period.
*The Refining Industry peer group will include Valero, Marathon, PBF Energy, Delek, HF Sinclair and Par Pacific.
Refining Bonus Plan Approved April 29, 2025 Page 10
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix F
EBITDA Multipliers
After accounting for the EH&S and Financial Measures highlighted in Appendix E, the Company Performance Multiplier will then be subject to an EBITDA Multiplier based on Adjusted EBITDA achieved for the period relative to the Adjusted EBITDA Threshold, with a minimum EBITDA Multiplier of 0% if Adjusted EBITDA is less than 50% of Threshold, and a maximum EBITDA Multiplier of 150% if Adjusted EBITDA is 400% or more of Threshold.
Example Company Performance Multiplier Calculation:
Refining Bonus Plan Approved April 29, 2025 Page 11
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix G
Definitions
“Adjusted EBITDA” for Refining means earnings before interest, taxes, depreciation and amortization, and adjusted for certain inventory valuation impacts, unrealized gains and losses on derivative transactions, turnaround expenses to the extent they are included in EBITDA, loss on extinguishment of debt, certain asset impairment charges, board-directed actions, and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee.
“Adjusted EBITDA Threshold” means actual maintenance and sustaining capital expenditures plus reserves for turnaround expenses plus interest on debt net of interest earned for the given Performance Period, and board-directed actions. [***].
“Capital Employed” means the total assets, less current liabilities (adjusted for appropriate Adjusted EBITDA modifications imputed on operating income).
“Chief Executive” means the President and Chief Executive Officer of the Company.
“Eligible Compensation” means (i) for eligible exempt employees, such employee’s base salary at the time the Bonus or Spot Bonus is determined (prorated for time in an eligible position), and (ii) for eligible non-exempt and non-union hourly employees, such employees’ eligible wages for the applicable year as determined by the Company to be required by law.
“Environmental Events” (“EE”) means the total number of reportable quantities and water deviations for Refining.
•Reportable quantities are releases of substances during a 24-hour period that exceed a federal, state or local reporting threshold.
oReportable quantity is an event or contemporaneous combination of events during at 24-hour period that results in a release that exceeds a reportable quantity or quantities of an EPCRA/CERCLA compound as defined in the EPA List of Lists or a release that exceeds any other federal, state or local reporting threshold. Federally permitted releases and continuous releases defined in 40 CFR §302.6 and §302.8 are not considered reportable quantities under this measure.
oA reportable quantity is counted by event or contemporaneous combination of events, not by the number of individual reports that are filed or number of compounds which exceed their reportable quantity. Events are considered contemporaneous if they occur within 24-hours or when a common cause results in one or more reportable quantities during contiguous or overlapping 24-hour periods.
•Water deviations are exceedances of a NPDES-based permit limit, wastewater bypasses and sheens to water of the United States.
oThe number of deviations is based on the number of individual permit limits exceeded irrespective of the number of causal events attributed to the deviation. However, a continuance of an ongoing permit limit deviation would not be double-counted if it were contemporaneous with a prior deviation and/or event.
oOil sheens and reportable quantities to water are only counted once as a water deviation environmental event.
A single event that results in multiple reportable quantities and/or when a water deviation is also a regulatory reportable quantity is not “double-counted” and will only be considered one Environmental Event.
Refining Bonus Plan Approved April 29, 2025 Page 12
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
“Executive Officer” of the Company means an “executive officer” as that term is defined in Rule 3b-7 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or an “officer” of the Company for purposes of Section 16 of the Exchange Act.
“Equipment Utilization” means actual throughput for the Performance Period divided by the planned throughput for the Performance Period, as adjusted at the discretion of the Compensation Committee for events or downtime caused by external events. Planned throughput is reflected in the Company’s annual volumetric plan for Refining. Monthly targets may be adjusted on a month by month basis to optimize production for which there is an economic incentive to do so during the given period. In such cases, the annual volumetric plan may be adjusted for the purposes of Bonus calculations with the new targets in place of the original targets.
“Operating Expense” means measurement of actual controllable and fixed operating costs divided by budgeted amounts for Refining. For purposes of calculating the Bonus, budgeted amounts are subject to revision by the Board in its discretion based on changes in business conditions or configuration of the business (e.g., items such as acquisitions or divestitures, unusual, external extraordinary or non-recurring charges and changes in staffing relating to changed strategy approved by the Board will be considered as items for potential adjustment).
“Process Safety Tier 1 Incident Rate” (“PSIR”) means a standardized measure of process safety performance for the number of Refining process safety tier 1 events per 100 full-time equivalent employees, as defined in the recommended practice for process safety performance indicators, ANSI/API RP 754. A process safety tier 1 event is an unplanned or uncontrolled loss of primary containment of any material, including non-toxic and non-flammable materials, from a process that results in one or more consequences, including:
•an employee, contractor or subcontractor “days away from work” injury and/or fatality;
•a hospital admission and/or fatality or a third-party;
•an officially declared community evacuation or community shelter-in-place;
•a fire or explosion resulting in greater than or equal to $100,000 of direct cost to the company;
•an officially declared community evacuation or community shelter-in-place;
•a pressure relief device (PRD) discharge to atmosphere whether directly or via a downstream destructive device that results in one or more of four defined consequences and a PRD discharge quantity greater than defined threshold quantities in a one-hour period; or,
•a release of material greater than defined threshold quantities described in any one-hour period.
“Reliability” means Lost Profit Opportunity (“LPO”), defined as foregone refining margin that results from operational variance due to factors within the Company’s control, specifically including human and equipment performance, divided by the sum of actual refining margin adjusted for certain inventory valuation impacts, unrealized gains and losses on derivative transactions, and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee plus LPO.
“Return on Capital Employed” (“ROCE”) means Refining operating income before depreciation and amortization (excluding asset impairments, certain non-cash asset write-downs and inventory valuation gains or losses and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee) divided by average Capital Employed during the Period (averages calculated using 5-quarter end balances for the measurement period).
“Total Recordable Injury Rate” (“TRIR”) means a standardized measure of safety performance for the number of Refining work-related injuries per 100 full-time equivalent employees, as defined by OSHA.
“Throughput” means total crude oil charged to the refinery.
Refining Bonus Plan Approved April 29, 2025 Page 13
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix H
Clawback and Recoupment Policy
This Clawback and Recoupment Policy applies to each Bonus and Spot Bonus (for purposes of this Plan, an “Award”).
If the Compensation Committee in its sole and absolute discretion, determines that (i) there has been misconduct or a gross dereliction of duty resulting in either a violation of law or Company Policy, that, in either case, causes significant financial or reputational harm to the Company (or any of its affiliates), and that an employee committed the misconduct or gross dereliction of duty, or failed in his or her responsibility to manage or monitor the applicable conduct or risk; (ii) an employee has committed an immoral act which is reasonably likely to impair the reputation of the Company (or any of its affiliates); (iii) an employee committed, or was indicted for, a felony or any crime involving fraud or embezzlement or dishonesty or was convicted of, or entered a plea of nolo contendere to a misdemeanor (other than a traffic violation) punishable by imprisonment under federal, state or local law; (iv) an employee violated any securities or employment laws or regulations; (v) an employee materially breached a Company Policy or any non-compete and/or non-solicitation clause included in an agreement or offer letter with such employee’s employer; (vi) an employee embezzled and/or misappropriated any property of the Company (or any of its affiliates) or committed any act involving fraud with respect to the Company (or any of its affiliates); or (vii) an employee engaged in conduct (including by omission) or an event or condition has occurred, which, in each case, would have given the Company or its subsidiaries the right to terminate the employee’s employment for Cause (as defined herein), then, to the extent not prohibited by applicable law, such Compensation Committee, in its sole and absolute discretion, may cancel, declare forfeited, or rescind such Award, or may seek reimbursement from such employee (and such employee will be obligated to repay) all or any portion of any payments made to such employee in respect of such Award.
If the Compensation Committee determines, in its sole and absolute discretion, that calculations underlying the performance measures and targets, including but not limited to mistakes in the Company’s financial statements, were incorrect, then such Compensation Committee may, in its sole and absolute discretion, seek to recover the amount of any payment made to employees that exceeded the amount that would have been paid based on the corrected calculations.
To the extent not prohibited by applicable law, if an employee is an officer, or, if applicable, has otherwise been designated by the Board of the Company as an Executive Officer, the Board may seek reimbursement of any payment made to such employee in respect of an Award in the event of a restatement of such Company’s (or any of its subsidiaries’) financial results (occurring due to material noncompliance with any financial reporting requirements under applicable securities laws) that reduced a previously granted payment made to such employee in respect of an Award. In that event, the Compensation Committee may, in its sole and absolute discretion, seek to recover the amount of any such payment made to the employee that exceeded the amount that would have been paid based on the restated financial results.
If the Company subsequently determines that it is required by law to apply a “clawback” or alternate recoupment provision to an Award, under the Dodd-Frank Wall Street Reform and Consumer Protection Act or otherwise, then such clawback or recoupment provision also shall apply to such Award, as if it had been included on the effective date of such Award.
Refining Bonus Plan Approved April 29, 2025 Page 14
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
To the extent not prohibited under applicable law, the Company (or any of its subsidiaries) (as applicable), in its sole and absolute discretion, will have the right to set off (or cause to be set off) any amounts otherwise due to employee from such Company or a subsidiary in satisfaction of any repayment obligation of such employee hereunder, provided that any such amounts are exempt from, or set off in a manner intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended.
For the avoidance of doubt, the Company’s and its subsidiaries’ rights under this Plan will apply to employees, without regard to whether any such employee is currently providing, or previously provided, services to the Company or its subsidiary as an employee.
“Cause” for purposes of any Award means such employee’s (i) refusal or neglect to perform substantially his or her employment-related duties or services, (ii) personal dishonesty, incompetence, willful misconduct or breach of fiduciary duty, (iii) indictment for, conviction of or entering a plea of guilty or nolo contendere to a crime constituting a felony or his or her willful violation of any applicable law (other than a traffic violation or other offense or violation outside of the course of employment or services to the Company or its affiliates which in no way adversely affects the Company and its affiliates or their reputation or the ability of the employee to perform his or her employment-related duties or services or to represent the Company or any affiliate of the Company that employs such employee or to which the employee performs services), (iv) failure to reasonably cooperate, following a request to do so by the Company, in any internal or governmental investigation of the Company or any of its affiliates or (v) material breach of any written covenant or agreement with the Company or any of its affiliates not to disclose any information pertaining to the Company or such affiliate or not to compete or interfere with the Company or such affiliate; provided that, in the case of any employee who, as of the date of determination, is party to an effective services, severance or employment agreement with the Company or any affiliate, “Cause” will have the meaning, if any, specified in such agreement.
Refining Bonus Plan Approved April 29, 2025 Page 15
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Exhibit 10.9
CVR Partners, LP and Subsidiaries
2025 Performance-Based Bonus Plan - Fertilizer
Philosophy / Background
CVR Partners, LP and its applicable subsidiaries (collectively, the “Company”) are committed to wages and benefits that are competitive with a market-based, pay-for-performance compensation philosophy, providing such base pay, bonus and long-term incentive awards in line with those of the fertilizer industry. This CVR Partners, LP 2025 Performance-Based Bonus Plan – Fertilizer (the “Plan”) is intended to reward high performance employees, and to retain these employees in critical roles, through the issuance of bonus awards (each, a “Bonus”).
Administration
The Plan is maintained and administered by, or under the direction of, the Compensation Committee (the "Compensation Committee") of the board of directors (the “Board”) of the general partner of the Company with respect to, and references to “employee” herein relate only to, eligible employees or officers of the Company and its general partner and subsidiaries, excluding any employees of (or individuals solely subject to the bonus plans of) CVR Energy, Inc. (“CVI”) and its subsidiaries relating to Refining or Corporate.
The Compensation Committee shall annually approve all salaries, targets and bonus metrics for employees who serve as Executive Officers (defined below) and shall annually approve a total bonus pool for all other eligible employees (“Non-Executive Employees”). The Compensation Committee delegates to the Chief Executive the authority to approve payouts from such total bonus pool to Non-Executive Employees, in his or her sole discretion. The Chief Executive shall also be responsible for assigning salaries, bonus targets, and Grade levels to Non-Executive Employees.
In the event of a claim or dispute brought forth by any Non-Executive Employee, the decision of the Chief Executive as to the facts in the case and the meaning and intent of any provision of the Plan, or its application, shall be final, binding, and conclusive. In the event of a claim or dispute brought forth by any Executive Officer, the decision of the Compensation Committee as to the facts in the case and the meaning and intent of any provision of the Plan, or its application, shall be final, binding, and conclusive.
The Plan described herein does not create a contractual obligation on the part of the Company. The Company expressly reserves the right to modify, discontinue, or otherwise change the Plan outlined in this document at the sole and absolute discretion of the Company without advance notice.
Introduction
The purpose of the Plan and any Bonus to be paid hereunder is to enhance the Company’s ability to attract, motivate, reward and retain employees, and to strengthen their commitment to the success of the Company.
Eligibility and Administration
Bonuses are made based on the applicable calendar year during which the employees performed the services and are generally paid (to the extent payable) after the financials have been audited and within 90 days of the end of the calendar year (the “Performance Period” or “Period”).
Fertilizer Bonus Plan Approved April 29, 2025 Page 1
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Generally, only exempt, non-exempt and non-union hourly employees are eligible to receive a Bonus, provided that, to receive a Bonus, an employee must: (i) be actively employed with the Company for at least 90 days during the calendar year; (ii) consistently perform at or above expectations for their role; (iii) be actively employed on the date of payout and not on a performance improvement plan or in corrective or disciplinary action status as a result of poor performance during the Performance Period. Employees hired prior to October 1 during the Performance Period will be eligible to receive a Bonus provided the above requirements (ii) and (iii) are met.
Subject to annual review, Bonuses are computed in accordance with each eligible employee’s Grade (as shown in Appendix A), prorated for time in an eligible position, as well as a performance multiplier of zero to 150 percent, based on performance against the achievement of the allocated Company and individual performance measures described herein. Appendices A-H present: the overall compensation structure (Appendix A), example calculations (Appendices B, C), eligibility (Appendix D), bonus payout measures (Appendix E), EBITDA multipliers (Appendix F), definitions (Appendix G), and Clawback and Recoupment Policy (Appendix H). In addition, if Adjusted EBITDA for a given Performance Period is less than 50% of the Adjusted EBITDA Threshold established for the Company, no Bonus will be paid for the Period, subject to Compensation Committee discretion. If Adjusted EBITDA is at least 50% of the Adjusted EBITDA Threshold established for the Company, an EBITDA Multiplier between 50% and 150% will be applied to the Company performance measures based on the Adjusted EBITDA achieved for a given Performance Period relative to the Adjusted EBITDA Threshold, with a 50% Adjusted EBITDA Threshold achievement earning a 50% multiplier and an Adjusted EBITDA Threshold achievement of 400% or more earning a 150% multiplier. Appendix F further describes the range of EBITDA multipliers based on various Adjusted EBITDA Threshold achievements. The Compensation Committee may, in its sole and absolute discretion, waive the Adjusted EBITDA Threshold requirement, increase, decrease, or otherwise adjust performance measures, targets, and payout ranges used hereunder, as a result of extraordinary or non-recurring events, changes in applicable accounting rules or principles, changes in the Company’s methods of accounting, changes in applicable law, changes due to consolidations, growth capital spend programs, acquisitions, or reorganizations affecting the Company and its subsidiaries and affiliates, or other similar changes in the Company’s business.
The Individual Performance Multiplier component of a Bonus, if any, is entirely discretionary.
Company Performance: Environmental Health & Safety (EH&S) Measures – 25%
EH&S measures are as follows (see Appendix G for definitions):
•Personal Safety – Total Recordable Injury Rate (TRIR);
•Process Safety – Process Safety Tier 1 Incident Rate (PSIR); and
•Environmental Events (EE).
Company Performance: Financial Measures – 75%
Financial measures are objectives related to the following (see Appendix F for definitions):
•Reliability;
•Equipment Utilization;
•Operating Expense; and
•Return on Capital Employed.
Fertilizer Bonus Plan Approved April 29, 2025 Page 2
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Spot Bonus
Introduction
Employees making an extraordinary contribution to the furtherance of Company financial performance or advances in Company culture may be nominated by their manager or executive sponsor for a Bonus on a spot basis (a “Spot Bonus”), subject to approval by the Chief Executive. Spot Bonuses will be limited to employees in salary grades E12 and below and a maximum value of five thousand dollars ($5,000).
Terms and Conditions of Spot Bonus
Except as specifically set forth herein, all of the provisions of this Plan will likewise apply to a Spot Bonus. For the avoidance of doubt, these provisions relate to, among others, forfeiture and/or recoupment, amendment or termination, tax withholding, data protection and consent and governing law.
General Provisions
See Appendix G for definitions relating to the Plan.
Participation in the Plan is subject to (i) each individual employee’s compliance with the Company’s mission and values, its code of ethics and its policies and procedures, including, without limitation, the Corporate Policies and Procedures and employee handbook (collectively, “Company Policies”), and (ii) the Clawback and Recoupment Policy attached as Appendix H.
Each employee that is eligible and receives a Bonus or Spot Bonus will be liable for any and all federal, state, provincial, local or foreign taxes, pension plan contributions, employment insurance premiums, social insurance contributions, amounts payable to a governmental and/or regulatory body in the employee’s country and other levies of any kind required by applicable laws to be deducted or withheld with respect to any such award (collectively, the “Withholding Taxes”). The Company will have the right to deduct and withhold all required Withholding Taxes from any payment or other consideration deliverable to an employee pursuant to any such payment. All awards under the Plan are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and shall be construed and interpreted in accordance with such intent.
Participation in the Plan does not confer upon any employee any right to continue in the employ of the Company or its subsidiaries, nor interfere in any way with the right of the Company and its subsidiaries to terminate any employee’s employment at any time. The Company and its subsidiaries are under no obligation to continue the Plan in future years.
The Compensation Committee may at any time, or from time to time, in its sole and absolute discretion, (a) amend, alter or modify the provisions of this Plan, (b) terminate this Plan, or (c) terminate the participation of an employee or group of employees in this Plan; provided, however, that in the event of the termination of the Plan or a termination of participation, the Compensation Committee, in its sole and absolute discretion, may determine that a prorated award is payable to employees who were participants in this Plan under such terms and conditions as established by the Compensation Committee.
Notwithstanding anything herein to the contrary, whether or not any payment or award is authorized, earned or paid under the Plan will be determined by the Compensation Committee in its sole and absolute discretion, and no such payment or award shall be earned, nor shall any right to any such payment or award exist or accrue, unless, among other factors, such payment or award has been
Fertilizer Bonus Plan Approved April 29, 2025 Page 3
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
authorized by the Compensation Committee in its sole and absolute discretion, and actually paid to the employee. In addition, whether or not any payment or award is authorized, earned or paid pursuant to the Plan is without regard to whether any of the individual performance metrics, financial performance targets and/or goals, or any other benchmarks, targets, personal goals or criteria set forth in the Plan are met, not met, exceeded or not exceeded.
No employee, beneficiary or other person shall have any right, title or interest in any amount awarded under the Plan prior to the payment of such award to him or her. An employee’s rights to a payment under the Plan are no greater than those of unsecured general creditors of the Company or its subsidiaries.
By participating in the Plan, each employee consents to the holding and processing of personal information provided by such employee to the employer, any affiliate of the employer, trustee or third party service provider, for all purposes relating to the operation of the Plan. Consents include, but are not limited to: (i) administering and maintaining employee records; (ii) providing information to the employer, its affiliates, trustees of any employee benefit trust, registrars, brokers or third party administrators of the Plan; (iii) providing information to future purchasers or merger partners of the employer or any of its affiliates, or the business in which the employee works; and (iv) to the extent not prohibited by applicable law, transferring information about the employee to any country or territory that may not provide the same protection for the information as the employee’s home country.
The Plan is governed by the laws of the State of New York and as such will be construed under and in accordance with the laws of the State of New York without regard to conflicts of law.
Fertilizer Bonus Plan Approved April 29, 2025 Page 4
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix A
Compensation Structure: Base Pay & Incentive Plans
[***]
Individual Performance Measures
Supervisor’s assessment of employee’s performance will be based on the following categories:
•Interpersonal effectiveness
•Business conduct
•Professional and technical development
•Leadership
•Achievement of goals
•Results orientation
The assessment is discretionary and based on a wide range of considerations which often change over the course of the year.
Fertilizer Bonus Plan Approved April 29, 2025 Page 5
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix B
Bonus Payout and Company Performance Calculations
Bonus Payout Calculation:
Fertilizer Bonus Plan Approved April 29, 2025 Page 6
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix C
Bonus Payout Examples
Fertilizer Bonus Plan Approved April 29, 2025 Page 7
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix D
Fertilizer Plan Eligibility
Non-union direct employees of Company, its general partner and their respective subsidiaries (other than Executive Officers), including employees in Marketing, Logistics, Coffeyville Nitrogen Planning and East Dubuque Nitrogen Fertilizers Planning, Coffeyville and East Dubuque fertilizer plants, and any employee of any affiliated entity, in each case, deemed by the Chief Executive in his or her sole discretion to be solely dedicated to Fertilizer, but excluding anyone not an eligible employee as described in the Plan.
Fertilizer Bonus Plan Approved April 29, 2025 Page 8
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix E
Fertilizer
Bonus Payout (Performance) Measures
Environmental Health & Safety (EH&S) Measures (25%)
Three measures evenly weighted (33-1/3% each): Total Recordable Injury Rate (TRIR), Process Safety Tier I Incident Rate (PSIR), and Environmental Events (EE):
| Percentage Change (over the prior year) | Bonus Achievement | |||||||
| Increase in TRIR, PSIR or EE | Zero | |||||||
| 0% | 50% of Target Percentage (Threshold) | |||||||
| Decrease > 0% and < 3% | Linear Interpolation between Threshold and Target | |||||||
| Decrease of 3% | Target Percentage | |||||||
| Decrease > 3% and < 10% | Linear Interpolation between Target and Maximum | |||||||
| Decrease of 10% or more, or if TRIR is maintained at or below 1.0, PSIR at or below 0.2 and EE at or below 20 | 150% of Target (Maximum) | |||||||
Financial Measures (75%)
Four measures evenly weighted (25% each):
| Reliability | Bonus Achievement | |||||||
| Greater than 7.0% | Zero | |||||||
| 7.00% | 50% of Target Percentage (Threshold) | |||||||
| 5.51% to 6.99% | Linear Interpolation between Threshold and Target | |||||||
| 5.50% | Target Percentage | |||||||
| 4.0% to 5.49% | Linear Interpolation between Target and Maximum | |||||||
| Less than 4.0% | 150% of Target (Maximum) | |||||||
| Equipment Utilization | Bonus Achievement | |||||||
| Less than 95% | Zero | |||||||
| 95% | 50% of Target Percentage (Threshold) | |||||||
| 95.01% to 99.99% | Linear Interpolation between Threshold and Target | |||||||
| 100% | Target Percentage | |||||||
| 100.01% to 104.99% | Linear Interpolation between Target and Maximum | |||||||
| Greater than 105% | 150% of Target (Maximum) | |||||||
| Operating Expense | Bonus Achievement | |||||||
| Greater than 105.0% | Zero | |||||||
| 105% | 50% of Target Percentage (Threshold) | |||||||
| 100.1% to 104.99% | Linear Interpolation between Threshold and Target | |||||||
| 100% | Target Percentage | |||||||
| 95.0% to 99.99% | Linear Interpolation between Target and Maximum | |||||||
| Less than 95% | 150% of Target (Maximum) | |||||||
Fertilizer Bonus Plan Approved April 29, 2025 Page 9
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
| ROCE (Ranking vs. Peer Group*) | Bonus Achievement | |||||||
| First (highest) | 150% of Target (Maximum) | |||||||
| Second | 125% of Target Percentage | |||||||
| Third | 112.5% of Target Percentage | |||||||
| Fourth | Target Percentage (100%) | |||||||
| Fifth | 50% of Target Percentage | |||||||
| Sixth | Zero | |||||||
| Seventh | Zero | |||||||
Bonus Payout Measures subject to peer group ranking will be based on LTM data as of September 30 of the Performance Period.
*The Fertilizer Industry peer group will consist of CF Industries, LSB Industries, Nutrien Ltd., The Andersons, Inc., AdvanSix Inc., and Flotek Industries.
Fertilizer Bonus Plan Approved April 29, 2025 Page 10
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix F
EBITDA Multipliers
After accounting for the EH&S and Financial Measures highlighted in Appendix E, the Company Performance Multiplier will then be subject to an EBITDA Multiplier based on Adjusted EBITDA achieved for the period relative to the Adjusted EBITDA Threshold, with a minimum EBITDA Multiplier of 0% if Adjusted EBITDA is less than 50% of Threshold, and a maximum EBITDA Multiplier of 150% if Adjusted EBITDA is 400% or more of Threshold.
Example Company Performance Multiplier calculation:
Fertilizer Bonus Plan Approved April 29, 2025 Page 11
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix G
Definitions
“Adjusted EBITDA” for Fertilizer means earnings before interest, taxes, depreciation and amortization, and adjusted for certain inventory valuation impacts, unrealized gains and losses on derivative transactions, turnaround expenses to the extent they are included in EBITDA, loss on extinguishment of debt, certain asset impairment charges, board-directed actions, and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee.
“Adjusted EBITDA Threshold” means actual maintenance and sustaining capital expenditures plus reserves for turnaround expenses plus interest on debt net of interest earned for the given Performance Period, and board-directed actions. [***].
“Capital Employed” means total assets, less current liabilities (adjusted for appropriate Adjusted EBITDA modifications imputed on operating income).
“Chief Executive” means the President and Executive Chairman of the Company’s general partner.
“Eligible Compensation” means (i) for eligible exempt employees, such employee’s base salary at the time the Bonus or Spot Bonus is determined (prorated for time in an eligible position), and (ii) for eligible non-exempt and non-union hourly employees, such employees’ eligible wages for the applicable year as determined by the Company to be required by law.
“Environmental Events” (“EE”) means the total number of reportable quantities and water deviations for Fertilizer.
•Reportable quantities are releases of substances during a 24-hour period that exceed a federal, state or local reporting threshold.
oReportable quantity is an event or contemporaneous combination of events during at 24-hour period that results in a release that exceeds a reportable quantity or quantities of an EPCRA/CERCLA compound as defined in the EPA List of Lists or a release that exceeds any other federal, state or local reporting threshold. Federally permitted releases and continuous releases defined in 40 CFR §302.6 and §302.8 are not considered reportable quantities under this measure.
oA reportable quantity is counted by event or contemporaneous combination of events, not by the number of individual reports that are filed or number of compounds which exceed their reportable quantity. Events are considered contemporaneous if they occur within 24-hours or when a common cause results in one or more reportable quantities during contiguous or overlapping 24-hour periods.
•Water deviations are exceedances of a NPDES-based permit limit, wastewater bypasses and sheens to water of the United States.
oThe number of deviations is based on the number of individual permit limits exceeded irrespective of the number of causal events attributed to the deviation. However, a continuance of an ongoing permit limit deviation would not be double-counted if it were contemporaneous with a prior deviation and/or event.
oOil sheens and reportable quantities to water are only counted once as a water deviation environmental event.
A single event that results in multiple reportable quantities and/or when a water deviation is also a regulatory reportable quantity is not “double-counted” and will only be considered one Environmental Event.
“Executive Officer” of the Company means an “executive officer” as that term is defined in Rule 3b-7 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or an “officer” of the CVR GP, LLC for purposes of Section 16 of the Exchange Act.
Fertilizer Bonus Plan Approved April 29, 2025 Page 12
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
“Equipment Utilization” means adjusted equivalent tons of urea ammonium nitrate production divided by the planned equivalent tons of production for the Performance Period, as adjusted at the discretion of the Compensation Committee for events or downtime caused by external events. Planned production is reflected in the Company’s annual volumetric plan for Fertilizer. Monthly targets may be adjusted on a month by month basis to optimize production for which there is an economic incentive to do so during the given period. In such cases, the annual volumetric plan may be adjusted for the purposes of Bonus calculations with the new targets in place of the original targets.
“Operating Expense” means measurement of actual controllable and fixed operating costs divided by budgeted amounts for Fertilizer. For purposes of calculating the Bonus, budgeted amounts are subject to revision by the Board in its discretion based on changes in business conditions or configuration of the business (e.g., items such as acquisitions or divestitures, unusual, external extraordinary or non-recurring charges and changes in staffing relating to changed strategy approved by the Board will be considered as items for potential adjustment).
“Process Safety Tier 1 Incident Rate” (“PSIR”) means a standardized measure of process safety performance for the number of Fertilizer process safety tier 1 events per 100 full-time equivalent employees, as defined in the recommended practice for process safety performance indicators, ANSI/API RP 754. A process safety tier 1 event is an unplanned or uncontrolled loss of primary containment of any material, including non-toxic and non-flammable materials, from a process that results in one or more consequences, including:
•an employee, contractor or subcontractor “days away from work” injury and/or fatality;
•a hospital admission and/or fatality or a third-party;
•an officially declared community evacuation or community shelter-in-place;
•a fire or explosion resulting in greater than or equal to $100,000 of direct cost to the company;
•an officially declared community evacuation or community shelter-in-place;
•a pressure relief device (PRD) discharge to atmosphere whether directly or via a downstream destructive device that results in one or more of four defined consequences and a PRD discharge quantity greater than defined threshold quantities in a one-hour period; or,
•a release of material greater than defined threshold quantities described in any one-hour period.
“Reliability” means Lost Profit Opportunity (“LPO”), defined as foregone gross margin that results from operational variance due to factors within the Company’s control, specifically including human and equipment performance, divided by the sum of actual gross margin adjusted for certain inventory valuation impacts, unrealized gains and losses on derivative transactions, and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee, plus LPO.
“Return on Capital Employed” (“ROCE”) means Fertilizer operating income before depreciation and amortization (excluding asset impairments, certain non-cash asset write-downs and inventory valuation gains or losses and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee) divided by average Capital Employed during the Period (averages calculated using 5-quarter end balances for the measurement period).
“Total Recordable Injury Rate” (“TRIR”) means a standardized measure of safety performance for the number of Fertilizer work-related injuries per 100 full-time equivalent employees, as defined by OSHA.
Fertilizer Bonus Plan Approved April 29, 2025 Page 13
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix H
Clawback and Recoupment Policy
This Clawback and Recoupment Policy applies to each Bonus and Spot Bonus (for purposes of this Plan, an “Award”).
If the Compensation Committee in its sole and absolute discretion, determines that (i) there has been misconduct or a gross dereliction of duty resulting in either a violation of law or Company Policy, that, in either case, causes significant financial or reputational harm to the Company (or any of its affiliates), and that an employee committed the misconduct or gross dereliction of duty, or failed in his or her responsibility to manage or monitor the applicable conduct or risk; (ii) an employee has committed an immoral act which is reasonably likely to impair the reputation of the Company (or any of its affiliates); (iii) an employee committed, or was indicted for, a felony or any crime involving fraud or embezzlement or dishonesty or was convicted of, or entered a plea of nolo contendere to a misdemeanor (other than a traffic violation) punishable by imprisonment under federal, state or local law; (iv) an employee violated any securities or employment laws or regulations; (v) an employee materially breached a Company Policy or any non-compete and/or non-solicitation clause included in an agreement or offer letter with such employee’s employer; (vi) an employee embezzled and/or misappropriated any property of the Company (or any of its affiliates) or committed any act involving fraud with respect to the Company (or any of its affiliates); or (vii) an employee engaged in conduct (including by omission) or an event or condition has occurred, which, in each case, would have given the Company or its subsidiaries the right to terminate the employee’s employment for Cause (as defined herein), then, to the extent not prohibited by applicable law, such Compensation Committee, in its sole and absolute discretion, may cancel, declare forfeited, or rescind such Award, or may seek reimbursement from such employee (and such employee will be obligated to repay) all or any portion of any payments made to such employee in respect of such Award.
If the Compensation Committee determines, in its sole and absolute discretion, that calculations underlying the performance measures and targets, including but not limited to mistakes in the Company’s financial statements, were incorrect, then such Compensation Committee may, in its sole and absolute discretion, seek to recover the amount of any payment made to employees that exceeded the amount that would have been paid based on the corrected calculations.
To the extent not prohibited by applicable law, if an employee is an officer, or, if applicable, has otherwise been designated by the Board of the Company as an Executive Officer, the Board may seek reimbursement of any payment made to such employee in respect of an Award in the event of a restatement of such Company’s (or any of its subsidiaries’) financial results (occurring due to material noncompliance with any financial reporting requirements under applicable securities laws) that reduced a previously granted payment made to such employee in respect of an Award. In that event, the Compensation Committee may, in its sole and absolute discretion, seek to recover the amount of any such payment made to the employee that exceeded the amount that would have been paid based on the restated financial results.
If the Company subsequently determines that it is required by law to apply a “clawback” or alternate recoupment provision to an Award, under the Dodd-Frank Wall Street Reform and Consumer Protection Act or otherwise, then such clawback or recoupment provision also shall apply to such Award, as if it had been included on the effective date of such Award.
To the extent not prohibited under applicable law, the Company (or any of its subsidiaries) (as applicable), in its sole and absolute discretion, will have the right to set off (or cause to be set off) any amounts otherwise due to employee from such Company or a subsidiary in satisfaction of any repayment obligation of such employee
Fertilizer Bonus Plan Approved April 29, 2025 Page 14
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
hereunder, provided that any such amounts are exempt from, or set off in a manner intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended.
For the avoidance of doubt, the Company’s and its subsidiaries’ rights under this Plan will apply to employees, without regard to whether any such employee is currently providing, or previously provided, services to the Company or its subsidiary as an employee.
“Cause” for purposes of any Award means such employee’s (i) refusal or neglect to perform substantially his or her employment-related duties or services, (ii) personal dishonesty, incompetence, willful misconduct or breach of fiduciary duty, (iii) indictment for, conviction of or entering a plea of guilty or nolo contendere to a crime constituting a felony or his or her willful violation of any applicable law (other than a traffic violation or other offense or violation outside of the course of employment or services to the Company or its affiliates which in no way adversely affects the Company and its affiliates or their reputation or the ability of the employee to perform his or her employment-related duties or services or to represent the Company or any affiliate of the Company that employs such employee or to which the employee performs services), (iv) failure to reasonably cooperate, following a request to do so by the Company, in any internal or governmental investigation of the Company or any of its affiliates or (v) material breach of any written covenant or agreement with the Company or any of its affiliates not to disclose any information pertaining to the Company or such affiliate or not to compete or interfere with the Company or such affiliate; provided that, in the case of any employee who, as of the date of determination, is party to an effective services, severance or employment agreement with the Company or any affiliate, “Cause” will have the meaning, if any, specified in such agreement.
Fertilizer Bonus Plan Approved April 29, 2025 Page 15
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Exhibit 10.10
CVR Energy, Inc. and Subsidiaries
2025 Performance-Based Bonus Plan – Corporate
Philosophy / Background
CVR Energy, Inc. and its applicable subsidiaries (collectively, the “Company”) are committed to wages and benefits that are competitive with a market-based, pay-for-performance compensation philosophy, providing such base pay, bonus and long-term incentive awards in line with those of the refining and fertilizer industries. This CVR Energy, Inc. and Subsidiaries 2025 Performance-Based Bonus Plan – Corporate (the “Plan”) is intended to reward high performance employees, and to retain these employees in critical roles, through the issuance of bonus awards (each, a “Bonus”).
Administration
The Plan is maintained and administered by, or under the direction of, the Compensation Committee (the "Compensation Committee") of the board of directors (the “Board”) of the Company with respect to, and references to “employee” herein relate only to, eligible employees or officers of the Company and its subsidiaries, excluding any employees of (or individuals solely subject to the bonus plans of) CVR Energy, Inc. relating to Refining or CVR Partners, LP (“UAN”) and its general partner and their respective subsidiaries relating to Fertilizer. Herein the CVR Energy, Inc. and Subsidiaries 2025 Performance-Based Bonus Plan – Refining shall be referred to as the “Refining Plan” and the CVR Partners, LP and Subsidiaries 2025 Performance-Based Bonus Plan – Fertilizer shall be referred to as the “Fertilizer Plan.”
The Compensation Committee shall annually approve all salaries, targets and bonus metrics for employees who serve as Executive Officers (defined below) and shall annually approve a total bonus pool for all other eligible employees (“Non-Executive Employees”). The Compensation Committee delegates to the Chief Executive the authority to approve payouts from such total bonus pool to Non-Executive Employees, in his or her sole discretion. The Chief Executive shall also be responsible for assigning salaries, bonus targets, and Grade levels to Non-Executive Employees.
In the event of a claim or dispute brought forth by any Non-Executive Employee, the decision of the Chief Executive as to the facts in the case and the meaning and intent of any provision of the Plan, or its application, shall be final, binding, and conclusive. In the event of a claim or dispute brought forth by any Executive Officer, the decision of the Compensation Committee as to the facts in the case and the meaning and intent of any provision of the Plan, or its application, shall be final, binding, and conclusive.
The Plan described herein does not create a contractual obligation on the part of the Company. The Company expressly reserves the right to modify, discontinue, or otherwise change the Plan outlined in this document at the sole and absolute discretion of the Company without advance notice.
Introduction
The purpose of the Plan and any Bonus to be paid hereunder is to enhance the Company’s ability to attract, motivate, reward and retain employees, and to strengthen their commitment to the success of the Company.
Eligibility and Administration
Bonuses are made based on the applicable calendar year during which the employees performed the services and are generally paid (to the extent payable) after the financials have been audited and within 90 days of the end of the calendar year (the “Performance Period” or “Period”).
Corporate Bonus Plan Approved April 29, 2025 Page 1
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Generally, only exempt, non-exempt and non-union hourly employees are eligible to receive a Bonus, provided that, to receive a Bonus, an employee must: (i) be actively employed with the Company for at least 90 days during the calendar year; (ii) consistently perform at or above expectations for their role; (iii) be actively employed on the date of payout and not on a performance improvement plan or in corrective or disciplinary action status as a result of poor performance during the Performance Period. Employees hired prior to October 1 during the Performance Period will be eligible to receive a Bonus provided the above requirements (ii) and (iii) are met.
Subject to annual review, Bonuses are computed in accordance with each eligible employee’s Grade (as shown in Appendix A), prorated for time in an eligible position, as well as a performance multiplier of zero to 150 percent, based on performance against the achievement of the allocated Company and individual performance measures described herein. Appendices A-H present: the overall compensation structure (Appendix A), example calculations (Appendices B, C), eligibility (Appendix D), bonus payout measures (Appendix E), EBITDA multipliers (Appendix F), definitions (Appendix G), and Clawback and Recoupment Policy (Appendix H). In addition, if Adjusted EBITDA for a given Performance Period is less than 50% of the Adjusted EBITDA Threshold established for the Company, no Bonus will be paid for the Period, subject to Compensation Committee discretion. If Adjusted EBITDA is at least 50% of the Adjusted EBITDA Threshold established for the Company, an EBITDA Multiplier between 50% and 150% will be applied to the Company performance measures based on the Adjusted EBITDA achieved for a given Performance Period relative to the Adjusted EBITDA Threshold, with a 50% Adjusted EBITDA Threshold achievement earning a 50% multiplier and an Adjusted EBITDA Threshold achievement of 400% or more earning a 150% multiplier. Appendix F further describes the range of EBITDA multipliers based on various Adjusted EBITDA Threshold achievements. The Compensation Committee may, in its sole and absolute discretion, waive the Adjusted EBITDA Threshold requirement, increase, decrease, or otherwise adjust performance measures, targets, and payout ranges used hereunder, as a result of extraordinary or non-recurring events, changes in applicable accounting rules or principles, changes in the Company’s methods of accounting, changes in applicable law, changes due to consolidations, growth capital spend programs, acquisitions, or reorganizations affecting the Company and its subsidiaries and affiliates, or other similar changes in the Company’s business.
For employees with an allocation to Company Performance (exempt grades 11 and higher and non-graded, non-union hourly employees), Company Performance is weighted between the Refining and Fertilizer Company Performance Multipliers based on each eligible employee’s established allocation between the Refining and Fertilizer businesses. Other than Executive Officers (who will have an allocation between the Refining and Fertilizer businesses as determined by the Chief Executive or the Compensation Committees, as applicable), eligible employees performing services for both the Refining and Fertilizer businesses shall have an allocation of (a) 80% Refining and 20% Fertilizer, for employees determined by the Chief Executive to spend less than 100% of their time on either Refining or Fertilizer, or (b) 100% to Refining or Fertilizer, as applicable, for employees determined by the Chief Executive to spend 100% of their time, in each case, except as otherwise determined by the Chief Executive or the Compensation Committees in their sole discretion.
The Individual Performance Multiplier component of a Bonus, if any, is entirely discretionary and may utilize each individual employee’s established allocation between the Refining and Fertilizer businesses, among other factors.
Corporate Bonus Plan Approved April 29, 2025 Page 2
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Company Performance: Environmental Health & Safety (EH&S) Measures – 25%
EH&S measures are as follows (see appendix G for definitions):
•Personal Safety – Total Recordable Injury Rate (TRIR);
•Process Safety – Process Safety Tier 1 Incident Rate (PSIR); and
•Environmental Events (EE).
Company Performance: Financial Measures – 75%
Financial measures are objectives related to the following (see appendix G for definitions):
•Reliability;
•Equipment Utilization;
•Operating Expense; and
•Return on Capital Employed.
Spot Bonus
Introduction
Employees making an extraordinary contribution to the furtherance of Company financial performance or advances in Company culture may be nominated by their manager or executive sponsor for a Bonus on a spot basis (a “Spot Bonus”), subject to approval by the Chief Executive. Spot Bonuses will be limited to employees in salary grades E12 and below and a maximum value of five thousand dollars ($5,000).
Terms and Conditions of Spot Bonus
Except as specifically set forth herein, all of the provisions of this Plan will likewise apply to a Spot Bonus. For the avoidance of doubt, these provisions relate to, among others, forfeiture and/or recoupment, amendment or termination, tax withholding, data protection and consent and governing law.
General Provisions
See Appendix G for definitions relating to the Plan.
Participation in the Plan is subject to (i) each individual employee’s compliance with the Company’s mission and values, its code of ethics and its policies and procedures, including, without limitation, the Corporate Policies and Procedures and employee handbook (collectively, “Company Policies”), and (ii) the Clawback and Recoupment Policy attached as Appendix H.
Each employee that is eligible and receives a Bonus or Spot Bonus will be liable for any and all federal, state, provincial, local or foreign taxes, pension plan contributions, employment insurance premiums, social insurance contributions, amounts payable to a governmental and/or regulatory body in the employee’s country and other levies of any kind required by applicable laws to be deducted or withheld with respect to any such award (collectively, the “Withholding Taxes”). The Company will have the right to deduct and withhold all required Withholding Taxes from any payment or other consideration deliverable to an employee pursuant to any such payment. All awards under the Plan are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and shall be construed and interpreted in accordance with such intent.
Participation in the Plan does not confer upon any employee any right to continue in the employ of the Company or its subsidiaries, nor interfere in any way with the right of the Company and its subsidiaries
Corporate Bonus Plan Approved April 29, 2025 Page 3
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
to terminate any employee’s employment at any time. The Company and its subsidiaries are under no obligation to continue the Plan in future years.
The Compensation Committee may at any time, or from time to time, in its sole and absolute discretion, (a) amend, alter or modify the provisions of this Plan, (b) terminate this Plan, or (c) terminate the participation of an employee or group of employees in this Plan; provided, however, that in the event of the termination of the Plan or a termination of participation, the Compensation Committee, in its sole and absolute discretion, may determine that a prorated award is payable to employees who were participants in this Plan under such terms and conditions as established by the Compensation Committee.
Notwithstanding anything herein to the contrary, whether or not any payment or award is authorized, earned or paid under the Plan will be determined by the Compensation Committee in its sole and absolute discretion, and no such payment or award shall be earned, nor shall any right to any such payment or award exist or accrue, unless, among other factors, such payment or award has been authorized by the Compensation Committee in its sole and absolute discretion, and actually paid to the employee. In addition, whether or not any payment or award is authorized, earned or paid pursuant to the Plan is without regard to whether any of the individual performance metrics, financial performance targets and/or goals, or any other benchmarks, targets, personal goals or criteria set forth in the Plan are met, not met, exceeded or not exceeded.
No employee, beneficiary or other person shall have any right, title or interest in any amount awarded under the Plan prior to the payment of such award to him or her. An employee’s rights to a payment under the Plan are no greater than those of unsecured general creditors of the Company or its subsidiaries.
By participating in the Plan, each employee consents to the holding and processing of personal information provided by such employee to the employer, any affiliate of the employer, trustee or third party service provider, for all purposes relating to the operation of the Plan. Consents include, but are not limited to: (i) administering and maintaining employee records; (ii) providing information to the employer, its affiliates, trustees of any employee benefit trust, registrars, brokers or third party administrators of the Plan; (iii) providing information to future purchasers or merger partners of the employer or any of its affiliates, or the business in which the employee works; and (iv) to the extent not prohibited by applicable law, transferring information about the employee to any country or territory that may not provide the same protection for the information as the employee’s home country.
The Plan is governed by the laws of the State of New York and as such will be construed under and in accordance with the laws of the State of New York without regard to conflicts of law.
Corporate Bonus Plan Approved April 29, 2025 Page 4
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix A
Compensation Structure: Base Pay & Incentive Plans
[***]
Individual Performance Measures
Supervisor’s assessment of employee’s performance will be based on the following categories:
•Interpersonal effectiveness
•Business conduct
•Professional and technical development
•Leadership
•Achievement of goals
•Results orientation
The assessment is discretionary and based on a wide range of considerations which often change over the course of the year.
Corporate Bonus Plan Approved April 29, 2025 Page 5
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix B
Bonus Payout and Company Performance Calculations
Bonus Payout Calculation:
Corporate Bonus Plan Approved April 29, 2025 Page 6
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix C
Bonus Payout Examples
Corporate Bonus Plan Approved April 29, 2025 Page 7
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix D
Corporate Plan Eligibility
Non-union General & Administrative and Shared Services employees of the Company and its subsidiaries, including Executive Officers, Legal, Communications, Risk Management, Finance & Accounting, Treasury, Investor Relations, Tax, IT, Financial Planning & Analysis, Human Resources, Internal Audit, Procurement, Environmental, Health, Safety & Security, in each case, deemed by the Chief Executive in his or her sole discretion to be dedicated to Corporate, but excluding anyone not an eligible employee as described in the Plan.
Company Performance: Bonus Payout
The Company Performance Multiplier for the Performance Period will be derived from the corresponding outcomes for Refining and Fertilizer against the Bonus Payout Measures outlined in Appendix E for the Period.
Corporate Bonus Plan Approved April 29, 2025 Page 8
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix E
Refining and Fertilizer
Bonus Payout (Performance) Measures
Environmental Health & Safety (EH&S) Measures (25%)
Three measures evenly weighted (33-1/3% each): Total Recordable Injury Rate (TRIR), Process Safety Tier I Incident Rate (PSIR), and Environmental Events (EE):
| Percentage Change (over the prior year) | Bonus Achievement | |||||||
| Increase in TRIR, PSIR or EE | Zero | |||||||
| 0% | 50% of Target Percentage (Threshold) | |||||||
| Decrease > 0% and < 3% | Linear Interpolation between Threshold and Target | |||||||
| Decrease of 3% | Target Percentage | |||||||
| Decrease > 3% and < 10% | Linear Interpolation between Target and Maximum | |||||||
Decrease of 10% or more, or if TRIR is maintained at or below 1.0, PSIR at or below 0.2 and EE at or below 20 | 150% of Target (Maximum) | |||||||
Financial Measures (75%)
Four measures evenly weighted (25% each):
| Reliability | Bonus Achievement | |||||||
| Greater than 7.0% | Zero | |||||||
| 7.00% | 50% of Target Percentage (Threshold) | |||||||
| 5.51% to 6.99% | Linear Interpolation between Threshold and Target | |||||||
| 5.5% | Target Percentage | |||||||
| 4.0% to 5.49% | Linear Interpolation between Target and Maximum | |||||||
| Less than 4.0% | 150% of Target (Maximum) | |||||||
| Equipment Utilization | Bonus Achievement | |||||||
| Less than 95% | Zero | |||||||
| 95% | 50% of Target Percentage (Threshold) | |||||||
| 95.01% to 99.99% | Linear Interpolation between Threshold and Target | |||||||
| 100% | Target Percentage | |||||||
| 100.01% to 104.99% | Linear Interpolation between Target and Maximum | |||||||
| Greater than 105% | 150% of Target (Maximum) | |||||||
| Operating Expense | Bonus Achievement | |||||||
| Greater than 105.0% | Zero | |||||||
| 105% | 50% of Target Percentage (Threshold) | |||||||
| 100.1% to 104.99% | Linear Interpolation between Threshold and Target | |||||||
| 100% | Target Percentage | |||||||
| 95.0% to 99.99% | Linear Interpolation between Target and Maximum | |||||||
| Less than 95% | 150% of Target (Maximum) | |||||||
Corporate Bonus Plan Approved April 29, 2025 Page 9
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Refining and Fertilizer ROCE (Ranking vs. Peer Group**) | Bonus Achievement | |||||||
| First (highest) | 150% of Target (Maximum) | |||||||
| Second | 125% of Target Percentage | |||||||
| Third | 112.5% of Target Percentage | |||||||
| Fourth | Target Percentage (100%) | |||||||
| Fifth | 50% of Target Percentage | |||||||
| Sixth | Zero | |||||||
| Seventh | Zero | |||||||
Bonus Payout Measures subject to peer group ranking will be based on LTM data as of September 30 of the Performance Period.
**The Refining Industry peer group will include Valero, Marathon, PBF Energy, Delek, HF Sinclair and Par Pacific.
**The Fertilizer Industry peer group will consist of CF Industries, LSB Industries, Nutrien Ltd., The Andersons, Inc., AdvanSix, Inc., and Flotek Industries.
Corporate Bonus Plan Approved April 29, 2025 Page 10
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix F
EBITDA Multipliers
After accounting for the EH&S and Financial Measures highlighted in Appendix E, the Company Performance Multiplier will then be subject to an EBITDA Multiplier based on Adjusted EBITDA achieved for the period relative to the Adjusted EBITDA Threshold, with a minimum EBITDA Multiplier of 0% if Adjusted EBITDA is less than 50% of Threshold, and a maximum EBITDA Multiplier of 150% if Adjusted EBITDA is 400% or more of Threshold.
Example Company Performance Multiplier calculation:
Corporate Bonus Plan Approved April 29, 2025 Page 11
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix G
Definitions
“Adjusted EBITDA” for the Company means the Adjusted EBITDA under the Refining Plan and the Fertilizer Plan.
“Adjusted EBITDA Threshold” means actual maintenance and sustaining capital expenditures plus reserves for turnaround expenses plus interest on debt net of interest earned for the given Performance Period, and board-directed actions. [***].
“Capital Employed” means the total assets, less current liabilities (adjusted for appropriate Adjusted EBITDA modifications imputed on operating income).
“Chief Executive” means the President and Chief Executive Officer of the Company.
“Eligible Compensation” means (i) for eligible exempt employees, such employee’s base salary at the time the Bonus or Spot Bonus is determined (prorated for time in an eligible position), and (ii) for eligible non-exempt and non-union hourly employees, such employees’ eligible wages for the applicable year as determined by the Company to be required by law.
“Environmental Events” (“EE”) means the total number of reportable quantities and water deviations.
•Reportable quantities are releases of substances during a 24-hour period that exceed a federal, state or local reporting threshold.
oReportable quantity is an event or contemporaneous combination of events during at 24-hour period that results in a release that exceeds a reportable quantity or quantities of an EPCRA/CERCLA compound as defined in the EPA List of Lists or a release that exceeds any other federal, state or local reporting threshold. Federally permitted releases and continuous releases defined in 40 CFR §302.6 and §302.8 are not considered reportable quantities under this measure.
oA reportable quantity is counted by event or contemporaneous combination of events, not by the number of individual reports that are filed or number of compounds which exceed their reportable quantity. Events are considered contemporaneous if they occur within 24-hours or when a common cause results in one or more reportable quantities during contiguous or overlapping 24-hour periods.
•Water deviations are exceedances of a NPDES-based permit limit, wastewater bypasses and sheens to water of the United States.
oThe number of deviations is based on the number of individual permit limits exceeded irrespective of the number of causal events attributed to the deviation. However, a continuance of an ongoing permit limit deviation would not be double-counted if it were contemporaneous with a prior deviation and/or event.
oOil sheens and reportable quantities to water are only counted once as a water deviation environmental event.
A single event that results in multiple reportable quantities and/or when a water deviation is also a regulatory reportable quantity is not “double-counted” and will only be considered one Environmental Event.
“Executive Officer” of the Company means an “executive officer” as that term is defined in Rule 3b-7 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or an “officer” of the Company for purposes of Section 16 of the Exchange Act.
“Equipment Utilization” means (i) for Refining, actual throughput for the Performance Period divided by the planned throughput for the Performance Period, and (ii) for Fertilizer, adjusted equivalent tons of urea ammonium nitrate production divided by the planned equivalent tons of production for the Performance Period,
Corporate Bonus Plan Approved April 29, 2025 Page 12
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
in each case, as adjusted at the discretion of the Compensation Committee for events or downtime caused by external events. Planned throughput and production is reflected in the Company’s annual volumetric plan. Monthly targets may be adjusted on a month by month basis to optimize production for which there is an economic incentive to do so during the given period. In such cases, the annual volumetric plan may be adjusted for the purposes of Bonus calculations with the new targets in place of the original targets.
“Operating Expense” means measurement of actual controllable and fixed operating costs divided by budgeted amounts. For purposes of calculating the Bonus, budgeted amounts are subject to revision by the Board in its discretion based on changes in business conditions or configuration of the business (e.g., items such as acquisitions or divestitures, unusual, external extraordinary or non-recurring charges and changes in staffing relating to changed strategy approved by the Board will be considered as items for potential adjustment).
“Process Safety Tier 1 Incident Rate” (“PSIR”) means a standardized measure of process safety performance for the number of process safety tier 1 events per 100 full-time equivalent employees, as defined in the recommended practice for process safety performance indicators, ANSI/API RP 754. A process safety tier 1 event is an unplanned or uncontrolled loss of primary containment of any material, including non-toxic and non-flammable materials, from a process that results in one or more consequences, including:
•an employee, contractor or subcontractor “days away from work” injury and/or fatality;
•a hospital admission and/or fatality or a third-party;
•an officially declared community evacuation or community shelter-in-place;
•a fire or explosion resulting in greater than or equal to $100,000 of direct cost to the company;
•an officially declared community evacuation or community shelter-in-place;
•a pressure relief device (PRD) discharge to atmosphere whether directly or via a downstream destructive device that results in one or more of four defined consequences and a PRD discharge quantity greater than defined threshold quantities in a one-hour period; or,
•a release of material greater than defined threshold quantities described in any one-hour period.
“Reliability” means Lost Profit Opportunity (“LPO”), defined as foregone refining margin that results from operational variance due to factors within the Company’s control, specifically including human and equipment performance, divided by the sum of actual refining margin (for the Refining Plan) or gross margin (for the Fertilizer Plan) adjusted for certain inventory valuation impacts, unrealized gains and losses on derivative transactions, and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee, plus LPO.
“Return on Capital Employed” (“ROCE”) means operating income before depreciation and amortization (excluding asset impairments, certain non-cash asset write-downs and inventory valuation gains or losses and other extraordinary items as deemed appropriate by the Company and approved by the Compensation Committee) divided by average Capital Employed during the Period (averages calculated using 5-quarter end balances for the measurement period).
“Total Recordable Injury Rate” (“TRIR”) means a standardized measure of safety performance for the number of work-related injuries per 100 full-time equivalent employees, as defined by OSHA.
“Throughput” means total crude oil charged to the refinery.
Corporate Bonus Plan Approved April 29, 2025 Page 13
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
Appendix H
Clawback and Recoupment Policy
This Clawback and Recoupment Policy applies to each Bonus and Spot Bonus (for purposes of this Plan, an “Award”).
If the Compensation Committee in its sole and absolute discretion, determines that (i) there has been misconduct or a gross dereliction of duty resulting in either a violation of law or Company Policy, that, in either case, causes significant financial or reputational harm to the Company (or any of its affiliates), and that an employee committed the misconduct or gross dereliction of duty, or failed in his or her responsibility to manage or monitor the applicable conduct or risk; (ii) an employee has committed an immoral act which is reasonably likely to impair the reputation of the Company (or any of its affiliates); (iii) an employee committed, or was indicted for, a felony or any crime involving fraud or embezzlement or dishonesty or was convicted of, or entered a plea of nolo contendere to a misdemeanor (other than a traffic violation) punishable by imprisonment under federal, state or local law; (iv) an employee violated any securities or employment laws or regulations; (v) an employee materially breached a Company Policy or any non-compete and/or non-solicitation clause included in an agreement or offer letter with such employee’s employer; (vi) an employee embezzled and/or misappropriated any property of the Company (or any of its affiliates) or committed any act involving fraud with respect to the Company (or any of its affiliates); or (vii) an employee engaged in conduct (including by omission) or an event or condition has occurred, which, in each case, would have given the Company or its subsidiaries the right to terminate the employee’s employment for Cause (as defined herein), then, to the extent not prohibited by applicable law, such Compensation Committee, in its sole and absolute discretion, may cancel, declare forfeited, or rescind such Award, or may seek reimbursement from such employee (and such employee will be obligated to repay) all or any portion of any payments made to such employee in respect of such Award.
If the Compensation Committee determines, in its sole and absolute discretion, that calculations underlying the performance measures and targets, including but not limited to mistakes in the Company’s financial statements, were incorrect, then such Compensation Committee may, in its sole and absolute discretion, seek to recover the amount of any payment made to employees that exceeded the amount that would have been paid based on the corrected calculations.
To the extent not prohibited by applicable law, if an employee is an officer, or, if applicable, has otherwise been designated by the Board of the Company as an Executive Officer, the Board may seek reimbursement of any payment made to such employee in respect of an Award in the event of a restatement of such Company’s (or any of its subsidiaries’) financial results (occurring due to material noncompliance with any financial reporting requirements under applicable securities laws) that reduced a previously granted payment made to such employee in respect of an Award. In that event, the Compensation Committee may, in its sole and absolute discretion, seek to recover the amount of any such payment made to the employee that exceeded the amount that would have been paid based on the restated financial results.
If the Company subsequently determines that it is required by law to apply a “clawback” or alternate recoupment provision to an Award, under the Dodd-Frank Wall Street Reform and Consumer Protection Act or otherwise, then such clawback or recoupment provision also shall apply to such Award, as if it had been included on the effective date of such Award.
To the extent not prohibited under applicable law, the Company (or any of its subsidiaries) (as applicable), in its sole and absolute discretion, will have the right to set off (or cause to be set off) any amounts otherwise due to employee from such Company or a subsidiary in satisfaction of any repayment obligation of such employee
Corporate Bonus Plan Approved April 29, 2025 Page 14
Certain identified information in this Plan denoted with “[***]” has been excluded from this exhibit because it is not material and would be competitively harmful if publicly disclosed.
hereunder, provided that any such amounts are exempt from, or set off in a manner intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended.
For the avoidance of doubt, the Company’s and its subsidiaries’ rights under this Plan will apply to employees, without regard to whether any such employee is currently providing, or previously provided, services to the Company or its subsidiary as an employee.
“Cause” for purposes of any Award means such employee’s (i) refusal or neglect to perform substantially his or her employment-related duties or services, (ii) personal dishonesty, incompetence, willful misconduct or breach of fiduciary duty, (iii) indictment for, conviction of or entering a plea of guilty or nolo contendere to a crime constituting a felony or his or her willful violation of any applicable law (other than a traffic violation or other offense or violation outside of the course of employment or services to the Company or its affiliates which in no way adversely affects the Company and its affiliates or their reputation or the ability of the employee to perform his or her employment-related duties or services or to represent the Company or any affiliate of the Company that employs such employee or to which the employee performs services), (iv) failure to reasonably cooperate, following a request to do so by the Company, in any internal or governmental investigation of the Company or any of its affiliates or (v) material breach of any written covenant or agreement with the Company or any of its affiliates not to disclose any information pertaining to the Company or such affiliate or not to compete or interfere with the Company or such affiliate; provided that, in the case of any employee who, as of the date of determination, is party to an effective services, severance or employment agreement with the Company or any affiliate, “Cause” will have the meaning, if any, specified in such agreement.
Corporate Bonus Plan Approved April 29, 2025 Page 15
Exhibit 10.11
AMENDMENT TO EMPLOYMENT AGREEMENT
This AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is dated and effective as of July 28, 2025, is entered into by and between CVR Energy, Inc., a Delaware corporation (the “Company”), and David L. Lamp (the “Executive” and, together with Company, the “Parties”) and amends the Employment Agreement by and between the Company and Executive (the “Employment Agreement”), dated December 12, 2024. Any capitalized term not defined herein shall have the meaning ascribed to such term in the Employment Agreement.
WHEREAS, the Executive is currently employed as the Chief Executive Officer and President of the Company pursuant to the Employment Agreement; and
WHEREAS, the Executive acknowledges that he has had an opportunity to consider this Amendment and enters into this Amendment voluntarily and with a full understanding of its terms.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and other valid consideration, the sufficiency of which is acknowledged, the Parties agree as follows:
A.Section 3.1 of the Employment Agreement is deleted in its entirety and replaced with the following:
3.1. Termination of Employment. The Company may terminate the Executive’s employment for any reason during the Term upon not less than thirty (30) days’ notice to the Executive (other than for Cause, which may be at any time in accordance with the definition thereof set forth on Appendix A), and the Executive may voluntarily resign the Executive’s employment for any reason during the Term upon not less than five (5) months’ prior written notice to the Company (other than a resignation by the Executive for Good Reason, which may be at any time in accordance with the definition thereof set forth on Appendix A). Upon the termination or resignation of the Executive’s employment with the Company for any reason (whether during the Term or thereafter), the Executive shall be entitled to any Base Salary earned but unpaid through the date of termination or resignation, any earned but unpaid Annual Bonus for completed fiscal years, any unused accrued PTO, any unreimbursed expenses in accordance with Section 2.5 hereof and any accrued and vested rights or benefits under any Company sponsored employee benefits plans payable in accordance with the terms and conditions of such plans (collectively, the “Accrued Amounts”).
B.Section 3.2(a) of the Employment Agreement is deleted in its entirety and replaced with the following:
3.2. Certain Terminations.
(a) Termination by the Company For Cause or Resignation without Good Reason without Satisfaction of the Resignation Notice Requirement. If during the Term the Executive’s employment is terminated (i) by the Company for Cause or (ii) due to the Executive’s resignation without Good Reason and without the Executive satisfying the Resignation Notice Requirement, the Executive shall be entitled to the Accrued Amounts and no other amounts. For purposes of this Agreement, the “Resignation Notice Requirement” means the Executive resigning without Good Reason and providing notice that is equal to the lesser of (x) five (5) months and (y) such other period as may be agreed to by the Compensation Committee. For the avoidance of doubt, if the Executive’s employment is terminated due to the Executive’s resignation without Good Reason and the Executive satisfies the Good Reason Notice Requirement, the Executive shall be entitled to receive the payments set forth in Section 3.2(b).
Except as expressly provided in this Amendment, all terms and provisions of the Employment Agreement not modified hereby are and will remain in full force and effect and are hereby ratified and confirmed. This Amendment shall not be construed as a waiver of any other provision of the Employment Agreement or as a waiver of or consent to any further or future action on the part of any Party.
[Signature Page Follows]
IN WITNESS WHEREOF, the Parties have executed this Amendment as of the date first written above.
| /s/ David L. Lamp | /s/ Melissa M. Buhrig | |||||||||||||||||||||||||
| DAVID L. LAMP | CVR ENERGY, INC. By: Melissa M. Buhrig, EVP, General Counsel and Secretary | |||||||||||||||||||||||||
Exhibit 10.12
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this “Employment Agreement”), dated as of July 28, 2025 (the “Execution Date”), and effective January 1, 2026 (the “Effective Date”), is entered into by and between CVR Energy, Inc., a Delaware corporation (the “Company”), and Mark A. Pytosh (the “Executive”). The effectiveness and commencement of this Employment Agreement shall be expressly conditioned upon and subject to the Executive’s (i) employment not having been terminated for any reason prior to the Effective Date and (ii) reporting for work on the Company’s first regularly scheduled work day that is on or following the Effective Date (together, the “Conditions”).
In consideration of the mutual covenants contained herein and other valid consideration, the sufficiency of which is acknowledged, the parties hereto agree as follows:
Section 1. Employment.
1.1. Term. The Company, either directly or through one of its wholly-owned Subsidiaries, agrees to continue to employ the Executive, and the Executive agrees to continued employment with the Company, in each case pursuant to this Employment Agreement, unless terminated earlier in accordance with Section 3 hereof, for a period commencing on the Effective Date and ending on December 31, 2028 (the “Initial Term”), provided that the term shall automatically renew for subsequent one (1)-year terms (each, a “Renewal Term” and together with the Initial Term, the “Term”), unless either party provides the other party with no fewer than six (6) months written notice of non-renewal. Notwithstanding anything to the contrary in this Agreement, if the Conditions are not satisfied, this Employment Agreement shall automatically terminate and be null and void ab initio, and none of the Executive, the Company, or any other person or entity shall have any liability hereunder.
1.2. Duties. During the Term, the Executive shall serve as Chief Executive Officer and President of the Company and in such other or additional positions as an officer or director of the Company, and of such direct or indirect affiliates of the Company, including, without limitation, CVR Partners, LP (“UAN” and, collectively, the “Affiliates”), as the Executive and the board of directors of the Company (the “Board”) mutually agree from time to time. As of the Effective Date, the Executive shall also serve as the President and Chief Executive Officer of UAN. In such positions, the Executive shall perform such duties, functions and responsibilities during the Term commensurate with the Executive’s positions as reasonably directed by the Board or the board of directors of the general partner of UAN (the “UAN GP Board”). The Executive shall be employed in the State of Texas at the Company’s headquarters during the Term.
1.3. Exclusivity. During the Term, the Executive shall (i) devote substantially all of his professional time and attention to the business and affairs of the Company and its Affiliates, (ii) to the best of his abilities, faithfully serve the Company and its Affiliates, (iii) in all material respects conform to and comply with the lawful and reasonable directions and instructions given to the Executive by the Board, consistent with Section 1.2 hereof, (iv) use the Executive’s best efforts to advance, promote and serve the interests of the Company and its
Affiliates, (v) comply with all of the policies of the Company and its Affiliates (including, without limitation, such policies with respect to legal compliance, conflicts of interest, confidentiality and business ethics, as are from time to time in effect), and (vi) except as otherwise permitted herein, not engage in any other business activity, whether or not such activity shall be engaged in for pecuniary profit. The provisions of this Section 1.3 shall not be construed to prevent the Executive from (a) investing the Executive’s personal, private assets as a passive investor in such form or manner as will not require any active services on the part of the Executive in the management or operation of the affairs of the companies, partnerships, or other business entities in which any such passive investments are made or (b) serving on the board of directors of one or more companies, family-related businesses or charitable or non-profit organizations; provided such service does not materially conflict with the Executive’s duties and obligations to the Company and such service is approved by the chairman of the Board and/or the UAN GP Board, as applicable.
Section 2. Compensation.
2.1. Salary. As compensation for the performance of the Executive’s services hereunder, during the Term, the Company shall pay to the Executive a salary at an annual rate of $1,100,000 which annual salary shall be prorated for any partial year at the beginning or end of the Term and shall accrue and be payable in accordance with the Company’s standard payroll policies, as such salary may be adjusted upward (but not downward) by the Compensation Committee (the “Compensation Committee”) of the Board (or such other duly authorized committee thereof) in its sole and absolute discretion (as adjusted, the “Base Salary”).
2.2. Annual Bonus. For each completed fiscal year occurring during the Term, the Executive shall be eligible to receive an annual cash bonus (the “Annual Bonus”) with a target award equal to 150% of the Executive’s Base Salary (the “Bonus Target”). The Annual Bonus will be subject to all of the terms and conditions of the applicable bonus plan, and consistent with this Employment Agreement. The actual Annual Bonus payouts will be based on achievement of the individual and/or Company performance criteria established for the applicable fiscal year by the Compensation Committee in its sole and absolute discretion. The Annual Bonus (or any pro-rated portion thereof), if any, payable to the Executive for a fiscal year will be paid by the Company to the Executive in the immediately succeeding fiscal year only after the completion of the audit of the Company’s consolidated financial statements and filing of the Company’s Annual Report on Form 10-K with respect to such fiscal year and, only after the Compensation Committee, in its sole and absolute discretion, has approved the final achievement level and payout. Except with respect to any Actual Pro-Rata Bonus or Target Pro-Rata Bonus the Executive becomes entitled to herein pursuant to Section 3.2(b) or Section 3.2(c), the Executive must be actively employed through the last day of the fiscal year during the Term in which the Annual Bonus was earned to be eligible for an Annual Bonus payment.
2.3. Employee Benefits. During the Term, the Executive shall be eligible to participate in such employee benefit plans and programs of the Company as in effect from time to time on the same basis as other senior executives of the Company and subject to the terms and conditions of any such plans and programs.
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2.4. Paid Time Off. During the Term, the Executive shall be entitled to twenty-seven (27) days of paid time off (“PTO”) each year.
2.5. Business Expenses. The Company shall pay or reimburse the Executive for all commercially reasonable business out-of-pocket expenses that the Executive incurs during the Term in performing the Executive’s duties under this Employment Agreement upon presentation of documentation and in accordance with the expense reimbursement policy of the Company as approved by the Board and in effect from time to time. Notwithstanding anything herein to the contrary or otherwise, except to the extent any expense or reimbursement described in this Employment Agreement does not constitute a “deferral of compensation” within the meaning of Section 409A of the Code and the Treasury regulations and other guidance issued thereunder, any expense or reimbursement described in this Employment Agreement shall meet the following requirements: (i) the amount of expenses eligible for reimbursement provided to the Executive during any calendar year will not affect the amount of expenses eligible for reimbursement to the Executive in any other calendar year; (ii) the reimbursements for expenses for which the Executive is entitled to be reimbursed shall be made on or before the last day of the calendar year following the calendar year in which the applicable expense is incurred; (iii) the right to payment or reimbursement or in-kind benefits hereunder may not be liquidated or exchanged for any other benefit; and (iv) the reimbursements shall be made pursuant to objectively determinable and nondiscretionary Company policies and procedures regarding such reimbursement of expenses.
2.6. Long-Term Incentive Awards. For each fiscal year during the Term, the Company shall grant to the Executive an award (each, an “LTIP Award” and collectively, the “LTIP Awards”) under or in connection with the Company’s Third Amended and Restated 2007 Long Term Incentive Plan, or its successor, with an aggregate annual target award opportunity of 150% of the Executive’s Base Salary. These LTIP Awards will be granted on the form of LTIP Award agreement applicable to other executive officers of the Company as may be approved by the Compensation Committee from time to time.
2.7 Transaction Bonus. If a Significant CVI Transaction or Significant UAN Transaction (each, as defined on Appendix A) occurs, as determined by the Board in accordance with the terms and conditions of this Employment Agreement in its good faith discretion following consultation with the Executive, during the Term, in each case, subject to the Executive’s continued employment (x) with the Company or its affiliates through the consummation of such Significant CVI Transaction or (y) with UAN or its affiliates through the consummation of such Significant UAN Transaction, as applicable, and the Executive’s timely execution and non-revocation of a Release (as defined below), the Executive shall be entitled to receive a Transaction Bonus (as defined on Appendix A), payable in a cash lump sum within seventy-five (75) days following the closing of such Significant Transaction. Notwithstanding anything in this Section 2.7 to the contrary, if a Significant Transaction is consummated within the sixty (60)-day period following a Qualifying Termination (as defined below), the Executive shall remain eligible to receive a Transaction Bonus, payable in a cash lump sum within thirty (30) days following the closing of such Significant Transaction, subject to the Executive’s satisfaction of the Release Requirement set forth in Section 3.2(b).
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2.8 Allocation of Compensation. Notwithstanding anything herein to the contrary, the Company may allocate compensation paid to the Executive pursuant to this Employment Agreement amongst the Company, UAN, and any other IEP entity in its sole and absolute discretion. For the avoidance of doubt, the Executive shall cooperate in good faith to assist with any such allocation, as may be requested by the Company from time to time.
Section 3. Employment Termination.
3.1. Termination of Employment. The Company may terminate the Executive’s employment for any reason during the Term upon not less than thirty (30) days’ notice to the Executive (other than for Cause, which may be at any time in accordance with the definition thereof set forth on Appendix A), and the Executive may voluntarily resign the Executive’s employment for any reason during the Term upon not less than six (6) months’ prior written notice to the Company (other than a resignation by the Executive for Good Reason, which may be at any time in accordance with the definition thereof set forth on Appendix A). Upon the termination or resignation of the Executive’s employment with the Company for any reason (whether during the Term or thereafter), the Executive shall be entitled to any Base Salary earned but unpaid through the date of termination or resignation, any unused accrued PTO, any unreimbursed expenses in accordance with Section 2.5 hereof, any accrued and vested benefits under any Company sponsored employee benefits plans payable in accordance with the terms and conditions of such plans, and, solely with respect to the Executive’s termination of employment in accordance with Section 3.2(b), (c) or (d), any earned but unpaid Annual Bonus for completed fiscal years (collectively, the “Accrued Amounts”).
3.2. Certain Terminations.
(a) Termination by the Company For Cause, Resignation without Good Reason without Satisfaction of the Resignation Notice Requirement, or Non-Renewal of the Term. If during the Term the Executive’s employment is terminated (i) by the Company for Cause, (ii) due to the Executive’s death or Disability (as defined on Appendix A), (iii) due to the Executive’s resignation without Good Reason and without the Executive satisfying the Resignation Notice Requirement, or (iv) due to the non-renewal of the Term by either party in accordance with Section 1.1, the Executive shall be entitled to the Accrued Amounts and no other amounts. For purposes of this Agreement, the “Resignation Notice Requirement” means the Executive resigning without Good Reason and providing notice that is equal to the lesser of (x) six (6) months and (y) such other period as may be agreed to by the Compensation Committee in its sole and absolute discretion.
(b) Termination by the Company without Cause or Resignation with Good Reason. If the Executive’s employment is terminated (i) by the Company without Cause or (ii) due to the Executive’s resignation for Good Reason (each, a “Qualifying Termination”), then in addition to the Accrued Amounts, the Executive shall be entitled to (collectively, the “Severance Payments”):
(i) subject to Section 3.2(b)(iv), an amount in cash equal to one and one-half (1.5) times the sum of (A) twelve (12) months of the Executive’s Base
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Salary, at the rate in effect immediately prior to the date of termination or resignation (or, in the case of a resignation for Good Reason, at the rate in effect immediately prior to the occurrence of the event constituting Good Reason, if greater) and (B) the average of the annual bonuses actually paid to the Executive during the three (3) calendar years immediately preceding the date of termination, payable in substantially equal installments in accordance with the Company’s standard payroll policies over the eighteen (18)-month period following the date of termination or resignation, provided, that no such payments shall commence unless and until the Executive has satisfied the Release Requirement (as defined below) in accordance with this Section 3.2(b), provided, further that the first installment of the Severance Payments shall be made on the Company’s first payroll date following the sixtieth (60th) day after the date of termination, together with all installments of the foregoing that would have been paid prior to such date, absent this proviso,
(ii) subject to Section 3.2(b)(iv), an Annual Bonus payment for the fiscal year of termination, equal to the product of (x) the actual Annual Bonus that would have otherwise been earned for the year of such termination, based on achievement of the individual and/or corporate performance criteria established for such fiscal year by the Compensation Committee (in its sole and absolute discretion), multiplied by (y) a fraction, the numerator of which is the number of completed months during the fiscal year of termination that the Executive is employed by the Company and the denominator of which is twelve (12) (an “Actual Pro-Rata Bonus”), which Actual Pro-Rata Bonus, if any, shall be payable by the Company to the Executive in the immediately succeeding fiscal year only after the completion of the audit of the Company’s consolidated financial statements and filing of the Company’s Annual Report on Form 10-K with respect to such fiscal year of termination and only after the Compensation Committee, in its sole and absolute discretion, has approved the final achievement level and payout,
(iii) accelerated vesting as to 100% of the unvested portion of any then-outstanding Incentive / Phantom Unit Awards (as defined on Appendix A), held by the Executive on the date of termination, with the payout value calculated based on the average closing price per share of the underlying unit for the twenty (20) business days preceding the date of termination, provided, however, that any Incentive / Phantom Unit Awards that vest (in whole or in part) upon the achievement of performance goals, shall vest as if the target level of performance had been achieved, with any such payment payable in a lump sum on the Company’s first payroll date following the sixtieth (60th) day after the date of termination (“Accelerated LTIP Vesting”), and
(iv) without duplication, if the Executive experiences a Qualifying Termination during the Change in Control Period (as defined on Appendix A), the Severance Payments pursuant to Sections 3.2(b)(i) and 3.2(b)(ii), shall be payable in a lump sum on the Company’s first payroll date following the sixtieth (60th) day after the later to occur of (x) the date of termination and (y) the date of the consummation of a
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Change in Control (the “Lump Sum Payment”), provided, that if Executive experiences a Qualifying Termination during the Change in Control Period prior to the consummation of a Change in Control, the Lump Sum Payment shall be reduced by any portion of the Severance Payments that the Executive received prior to the consummation of such Change in Control.
The Company’s obligations to make the Severance Payments shall be conditioned upon: (i) the Executive’s continued compliance with the Executive’s obligations under Section 4 of this Employment Agreement and (ii) the Executive’s timely execution, delivery and non-revocation of a valid and enforceable release of claims arising in connection with the Executive’s employment and termination or resignation of employment with the Company (the “Release”) in a form reasonably acceptable to the Company and the Executive that becomes effective not later than forty-five (45) days after the date of such termination or resignation of employment (the “Release Requirement”). The Company shall provide the form of the Release to the Executive within five (5) days following the date of the Executive’s termination or resignation of employment. In the event that the Executive breaches any of the covenants set forth in Section 4 of this Employment Agreement, the Executive shall immediately return to the Company any portion of the Severance Payments (to the extent applicable) that has been paid to the Executive pursuant to this Section 3.2(b) and shall no longer be entitled to the payments and entitlements under this Section 3.2(b).
(c) Resignation without Good Reason following Satisfaction of the Resignation Notice Requirement. If the Executive’s employment is terminated due to the Executive’s resignation without Good Reason and the Executive satisfies the Resignation Notice Requirement, in addition to the Accrued Amounts, the Executive shall be entitled to receive an amount in cash equal to the product of (x) the Bonus Target, multiplied by (y) a fraction, the numerator of which is the number of completed months during the fiscal year of termination that the Executive is employed by the Company and the denominator of which is twelve (12) (a “Target Pro-Rata Bonus”), payable in a lump sum on the Company’s first payroll date following the sixtieth (60th) day after the date of termination.
(d) Termination due to the Executive’s death or Disability. If the Executive’s employment is terminated due to the Executive’s death or Disability, in addition to the Accrued Amounts, the Executive shall be entitled to receive (i) a Target Pro-Rata Bonus and (ii) Accelerated LTIP Vesting, in each case, payable in a lump sum on the Company’s first payroll date following the sixtieth (60th) day after the date of termination.
(e) Section 409A. To the extent applicable, this Employment Agreement shall be interpreted, construed and operated in accordance with Section 409A of the Code and the Treasury regulations and other guidance issued thereunder. If on the date of the Executive’s separation from service (as defined in Treasury Regulation §1.409A-1(h)) with the Company the Executive is a specified employee (as defined in Code Section 409A and Treasury Regulation §1.409A-1(i)), no payment constituting the “deferral of compensation” within the meaning of Treasury Regulation §1.409A-1(b) and after application of the exemptions provided in Treasury Regulation §§1.409A-1(b)(4) and 1.409A-1(b)(9)(iii), shall be made to the Executive
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at any time prior to the earlier of (a) the expiration of the six (6) month-period following the Executive’s separation from service, and (b) the Executive’s death, and any such amounts deferred during such period shall instead be paid in a lump sum to the Executive (or, if applicable, the Executive’s estate) on the first payroll payment date following expiration of such six (6) month-period or, if applicable, the Executive’s death. For purposes of conforming this Employment Agreement to Section 409A of the Code, the parties agree that any reference to termination of employment, severance from employment, resignation from employment or similar terms shall mean and be interpreted as a “separation from service” as defined in Treasury Regulation §1.409A-1(h). For purposes of applying Section 409A of the Code to this Employment Agreement (including, without limitation, for purposes of Treasury Regulation Section 1.409A-2(b)(2)(iii)), each payment that the Executive may be entitled to receive under this Employment Agreement shall be treated as a separate and distinct payment and shall not collectively be treated as a single payment. Neither the Company nor any of its Affiliates shall be obligated to pay or otherwise gross-up the Executive for any federal, state, local or foreign taxes relating to or arising with respect to any benefits, compensation or payment made under this Employment Agreement.
3.3. Exclusive Remedy. The foregoing payments upon termination or resignation of the Executive’s employment shall constitute the exclusive severance payments due the Executive upon a termination or resignation of the Executive’s employment under this Employment Agreement.
3.4. Resignation from All Positions. Upon the termination or resignation of the Executive’s employment with the Company for any reason, the Executive shall be deemed to have resigned, as of the date of such termination or resignation, from and with respect to all positions the Executive then holds as an officer, director, employee and member of the Board of Directors (and any committee thereof) of the Company and any of its Subsidiaries. For the avoidance of doubt, no payments or entitlements shall be made or provided pursuant to Section 3.2(b) or Section 3.2(c), unless the Executive’s employment with the Company and each of its Affiliates, including, without limitation, UAN and any other IEP entity, is terminated.
3.5. Cooperation. Following the termination or resignation of the Executive’s employment with the Company for any reason and at all times thereafter, the Executive agrees to reasonably cooperate with the Company upon reasonable request of the Board and to be reasonably available to the Company with respect to matters arising out of the Executive’s services to the Company and its Affiliates.
Section 4. Unauthorized Disclosure; Non-Competition; Non-Solicitation; Proprietary Rights.
4.1. Unauthorized Disclosure.
(a) During the Term and at all times thereafter, the Executive shall hold in a fiduciary capacity for the benefit of the Company and each of its Affiliates, all secret or confidential information, knowledge or data, including, without limitation, technical information, intellectual property, business and marketing plans, strategies, customer information and lists,
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software, trade secrets, sources of supplies and materials, designs, production and design techniques and methods, identity of investments, identity of contemplated investments, business opportunities, valuation models and methodologies, processes, technologies, and any other intellectual property relating to the business, or other information concerning the products, promotions, development, financing, expansion plans, business policies and practices, of the Company and each of its Affiliates, and their respective businesses, and other forms of information considered by the Company and its Affiliates to be confidential and in the nature of trade secrets (i) obtained by the Executive during the Executive’s employment by the Company or any of its Affiliates and/or during any period of time in which the Executive has access to email and/or information technology services from the Company, and (ii) not otherwise in the public domain (collectively, “Confidential Information”).
(b) The Executive also agrees to keep confidential and not to publish, post on his own or to disclose any personal information regarding any controlling Person of the Company (or any of its Affiliates), including, without limitation, Carl C. Icahn, or any of his Affiliates and their respective employees, and any member of the immediate family of any such Person (and all such personal information shall be deemed “Confidential Information” for the purposes of this Employment Agreement). The Executive shall not, without the prior written consent of the Company (acting at the direction of the Board): (i) except to the extent compelled pursuant to the order of a court or other body having jurisdiction over such matter or based upon the advice of counsel that such disclosure is legally required, communicate or divulge any Confidential Information to anyone other than the Company and those designated by the Company; or (ii) use any Confidential Information for any purpose other than the performance of his duties pursuant to this Employment Agreement. The Executive will assist the Company or its designee, at the Company’s expense, in obtaining a protective order, other appropriate remedy or other reliable assurance that confidential treatment will be accorded any Confidential Information disclosed pursuant to the terms of this Employment Agreement. The Executive agrees not to disparage the Company, its officers and directors, Mr. Icahn, any Related Parties, or any Affiliate of any of the foregoing, in each case during and/or after the Executive’s employment hereunder. Without limiting anything contained above, the Executive agrees and acknowledges that all personal and not otherwise public information about the Company and its Affiliates (including, without limitation, all information regarding IEP, Carl C. Icahn, Mr. Icahn’s family, and employees of the Company, IEP and their respective Affiliates) shall constitute Confidential Information for purposes of this Employment Agreement.
(c) Upon termination or resignation of the Executive’s employment with the Company, the Executive shall promptly return to the Company all property, keys, notes, memoranda, writings, lists, files, reports, customer lists, correspondence, tapes, disks, cards, surveys, maps, logs, machines, technical data and any other tangible product or document which has been produced by, received by or otherwise submitted to the Executive during the Executive’s employment with the Company and related to such employment with the Company, and any copies thereof in the Executive’s (or capable of being reduced to the Executive’s) possession.
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(d) The Executive further agrees not to write, contribute to, or assist any other person in writing or creating, a book, film, broadcast, article, blog or any other publication (whether in print, electronic or any other form) about or concerning, in whole or in part, the Company, IEP, Mr. Icahn and his family members or any of the respective Affiliates and subsidiaries of any of the foregoing (as applicable), in any media, and not to publish or cause to be published in any media, any Confidential Information, and further agrees to keep confidential and not to disclose to any third party, including, but not limited to, newspapers, authors, publicists, journalists, bloggers, gossip columnists, producers, directors, script writers, media personalities, and the like, in any and all media or communication methods, any Confidential Information. In furtherance of the foregoing, the Executive agrees that during the Term and following the termination of his employment with the Company, the sole and only disclosure or statement he will make about or concerning any or all of the Company, IEP, Mr. Icahn and his family members or any of the respective Affiliates and subsidiaries of any of the foregoing (as applicable) is to acknowledge that the Executive is or was employed by the Company (unless otherwise required by applicable law).
4.2. Non-Competition. By and in consideration of the Company’s entering into this Employment Agreement and the payments to be made and benefits to be provided by the Company hereunder, and in further consideration of the Executive’s exposure to the Confidential Information of the Company and its Affiliates, the Executive agrees that the Executive shall not, except as otherwise provided herein, during the Term and for eighteen (18) months following the termination of the Executive’s employment for any reason (the “Restriction Period”), directly or indirectly, own, manage, operate, join, control, be employed by, or participate in the ownership, management, operation or control of, or be connected in any manner with, including, without limitation, holding any position as a principal, agent, owner, stockholder, director, officer, consultant, advisor, independent contractor, employee, partner, or investor in, any Restricted Enterprise (as defined below); provided, that in no event shall ownership of one percent (1%) or less of the outstanding securities of any class of any issuer whose securities are registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), standing alone, be prohibited by this Section 4.2, so long as the Executive does not have, or exercise, any rights to manage or operate the business of such issuer other than rights as a stockholder thereof. For purposes of this paragraph, “Restricted Enterprise” shall mean any Person that is actively engaged in any business which is either (i) in competition with the business of the Company or any of its Affiliates conducted during the preceding six (6) months (or following the Term, the six (6) months preceding the last day of the Term), or (ii) proposed to be conducted by the Company or any of its Affiliates in the Company’s or Affiliate’s business plan as in effect at that time (or following the Term, the business plan as in effect as of the last day of the Term). During the Restriction Period, upon request of the Company, the Executive shall notify the Company of the Executive’s then-current employment status. For the avoidance of doubt, (A) a Restricted Enterprise shall not include any Person or division thereof that is engaged in the business of supplying (but not refining) crude oil or natural gas and (B) if the Executive’s employment is terminated by the Company without Cause or this Employment Agreement expires upon or following the end of the Term, beginning ninety (90) days following the Executive’s last day of employment, the Executive may serve on the board of directors of a Restricted Enterprise.
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4.3. Non-Solicitation of Employees. During the Restriction Period, the Executive shall not directly or indirectly solicit (or assist any Person to solicit) for employment any person who is, or within six (6) months prior to the date of such solicitation was, an employee of the Company or any of its Affiliates; provided, however, that this Section 4.3 shall not prohibit the hiring of any individual as a result of the individual’s response to an advertisement in a publication of general circulation.
4.4. Non-Solicitation of Customers/Suppliers. During the Restriction Period, the Executive shall not, directly or indirectly, (i) solicit, interfere with or entice away from the Company or any of its Affiliates, any current supplier, customer or client, (ii) direct or solicit any current supplier, customer or client away from the Company or any of its Affiliates, or (iii) advise any Person not to do business with, or be employed by the Company or any of its Affiliates.
4.5. Extension of Restriction Period. The Restriction Period shall be extended for a period of time equal to any period during which the Executive is in breach of any of Section 4.2, 4.3 or 4.4 hereof.
4.6. Proprietary Rights. Any and all inventions, processes, know-how, technologies, trade-secrets information, intellectual property, discoveries, and improvements (whether or not patentable or registrable under copyright or similar statutes), and all patentable or copyrightable works, initiated, conceived, discovered, reduced to practice, or made by the Executive, either alone or in conjunction with others, during the Executive’s employment with the Company and related to the business or activities of the Company or its Affiliates (whether or not on the Company’s or any of its Affiliates’ time or with the use of the Company’s or any of its Affiliates’ facilities or materials) (the “Developments”) shall be the property of the Company or any of its Affiliates, as the case may be, and shall be promptly and fully disclosed by the Executive to the Company. Except to the extent any rights in any Developments constitute a work made for hire under the U.S. Copyright Act, 17 U.S.C. § 101 et seq. that are owned ab initio by the Company and/or its Affiliates, the Executive assigns all of the Executive’s right, title and interest in all Developments (including all intellectual property rights therein) to the Company or its nominee without further compensation, including all rights or benefits therefor, including without limitation the right to sue and recover for past and future infringement. The Executive acknowledges that any rights in any developments constituting a work made for hire under the U.S. Copyright Act, 17 U.S.C § 101 et seq. are owned upon creation by the Company and/or its Affiliates as the Executive’s employer. Whenever requested to do so by the Company, and without further compensation therefor, the Executive shall execute any and all applications, assignments or other instruments which the Company shall deem necessary to apply for and obtain trademarks, patents or copyrights of the United States or any foreign country or otherwise protect the interests of the Company and its Affiliates therein. These obligations shall continue beyond the end of the Executive’s employment with the Company with respect to the Developments, and shall be binding upon the Executive’s employers, assigns, executors, administrators and other legal representatives. In connection with the Executive’s execution of this Employment Agreement, the Executive has informed the Company in writing of any interest in any inventions or intellectual property rights that the Executive holds as of the date hereof. If
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the Company is unable for any reason to obtain the Executive’s signature on any document needed in connection with the actions described in this Section 4.6, the Executive hereby irrevocably designates and appoints the Company, its Affiliates, and their respective duly authorized officers and agents as the Executive’s agent and attorney in fact to act for and in the Executive’s behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of this Section with the same legal force and effect as if executed by the Executive.
4.7. Protected Activity. Nothing in this Employment Agreement prohibits the Executive from reporting any possible violations of federal law or regulation to any government agency or entity, including but not limited to the Department of Justice and the Securities and Exchange Commission, or making any other disclosures that are protected under the whistleblower provisions of federal law or regulation. The Executive is not required to notify the Company that he will make or has made such reports or disclosures. Non-compliance with the non-disclosure provisions of this Employment Agreement shall not subject the Executive to criminal or civil liability under any Federal or State trade secret law for the disclosure of a Company trade secret if the disclosure is made: (a) in confidence to a Federal, State or local government official, either directly or indirectly, or to an attorney in confidence solely for the purpose of reporting or investigating a suspected violation of law; (b) in a complaint or other document filed in a lawsuit or other proceeding, provided that any complaint or document containing the trade secret is filed under seal; or (c) to an attorney representing the Executive in a lawsuit for retaliation by the Company for reporting a suspected violation of law or to use the trade secret information in that court proceeding, provided that any document containing the trade secret is filed under seal and the Executive does not disclose the trade secret, except pursuant to court order.
4.8. Remedies. The Executive agrees that any breach of the terms of this Section 4 would result in irreparable injury and damage to the Company and its Affiliates for which the Company and its Affiliates would have no adequate remedy at law; the Executive therefore also agrees that in the event of said breach or any threat of breach, the Company and its Affiliates shall be entitled to an immediate injunction and restraining order to prevent such breach and/or threatened breach and/or continued breach by the Executive and/or any and all Persons acting for and/or with the Executive, without having to prove damages, in addition to any other remedies to which the Company and its Affiliates may be entitled at law or in equity, including, without limitation, the obligation of the Executive to return any Severance Payments paid by the Company back to the Company. The terms of this paragraph shall not prevent the Company or its Affiliates from pursuing any other available remedies for any breach or threatened breach hereof, including, without limitation, the recovery of damages from the Executive. The Executive and the Company further agree that the provisions of the covenants contained in this Section 4 are reasonable and necessary to protect the businesses of the Company and its Affiliates because of the Executive’s access to Confidential Information and the Executive’s material participation in the operation of such businesses.
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Section 5. Representation.
The Executive acknowledges, covenants, agrees, warrants and represents that: (i) he is not a party to any contract, nor is he subject to, or bound by any commitment, restrictive covenant or agreement, order, judgment, decree, law, statute, ordinance, rule, regulation or other restriction of any kind or character, which either would or purports to, prevent or restrict him from entering into and performing his obligations under this Employment Agreement free of any limitations; (ii) he is free to enter into the arrangements contemplated herein; (iii) he is not subject to any agreement or obligation that would limit his ability to act on behalf of the Company or any of its Affiliates; (iv) the performance of his duties in respect thereof will not violate or conflict with any agreement or obligation to which he is subject; and (v) he has had an opportunity to consult with independent legal counsel regarding his rights and obligations under this Employment Agreement and that he fully understands the terms and conditions contained herein.
Section 6. Withholding.
All amounts paid to the Executive under this Employment Agreement during or following the Term shall be subject to withholding and other employment taxes imposed by applicable law.
Section 7. Effect of Section 280G of the Code.
7.1. Payment Reduction. Notwithstanding anything contained in this Employment Agreement to the contrary, (i) to the extent that any payment or distribution of any type to or for the benefit of the Executive by the Company, any Affiliate of the Company, any Person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets (within the meaning of Section 280G of the Code and the regulations thereunder), or any Affiliate of such Person, whether paid or payable or distributed or distributable pursuant to the terms of this Employment Agreement or otherwise (the “Payments”) constitutes “parachute payments” (within the meaning of Section 280G of the Code), and if (ii) such aggregate Payments would, if reduced by all federal, state and local taxes applicable thereto, including the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), be less than the amount the Executive would receive, after all taxes, if the Executive received aggregate Payments equal (as valued under Section 280G of the Code) to only three (3) times the Executive’s “base amount” (within the meaning of Section 280G of the Code), less $1.00, then (iii) such Payments shall be reduced (but not below zero) if and to the extent necessary so that no Payments to be made or benefit to be provided to the Executive shall be subject to the Excise Tax; provided, however, that, solely to the extent applicable, the Company shall use its reasonable best efforts to obtain shareholder approval of the Payments provided for in this Employment Agreement in a manner intended to satisfy requirements of the “shareholder approval” exception to Section 280G of the Code and the regulations promulgated thereunder, such that payment may be made to the Executive of such Payments without the application of an Excise Tax. If the Payments are so reduced, the Company shall reduce or eliminate the Payments (x) by first reducing or eliminating the portion of the Payments which are not payable in cash (other than that portion of the Payments subject to clause (z) hereof), (y) then by reducing or
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eliminating cash payments (other than that portion of the Payments subject to clause (z) hereof) and (z) then by reducing or eliminating the portion of the Payments (whether payable in cash or not payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or successor thereto) applies, in each case in reverse order beginning with payments or benefits which are to be paid the farthest in time.
7.2. Determination of Amount of Reduction (if any). The determination of whether the Payments shall be reduced as provided in Section 7.1 hereof and the amount of such reduction shall be made at the Company’s expense by an accounting firm selected by the Company from among the four (4) largest accounting firms in the United States (the “Accounting Firm”). The Accounting Firm shall provide its determination (the “Determination”), together with detailed supporting calculations and documentation, to the Company and the Executive within ten (10) days after the Executive’s final day of employment. If the Accounting Firm determines that no Excise Tax is payable by the Executive with respect to the Payments, it shall furnish the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to any such payments and, absent manifest error, such Determination shall be binding, final and conclusive upon the Company and the Executive.
Section 8. Miscellaneous.
8.1. Amendments and Waivers. This Employment Agreement and any of the provisions hereof may be amended, waived (either generally or in a particular instance and either retroactively or prospectively), modified or supplemented, in whole or in part, only by written agreement signed by the parties hereto; provided, that, the observance of any provision of this Employment Agreement may be waived in writing by the party that will lose the benefit of such provision as a result of such waiver. The waiver by any party hereto of a breach of any provision of this Employment Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach, except as otherwise explicitly provided for in such waiver. Except as otherwise expressly provided herein, no failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder, or otherwise available in respect hereof at law or in equity, shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further exercise thereof or the exercise of any other right, power or remedy.
8.2. Fees and Expenses. In the event of any dispute between the Company and the Executive arising under this Employment Agreement, the Company shall pay all reasonable legal fees and related expenses (including the costs of experts, evidence and counsel) incurred by the Executive in the event the Executive is the prevailing party in such dispute; provided, that, if it is determined that the Executive’s termination of employment was for Cause, the Executive shall not be entitled to any payment or reimbursement pursuant to this Section 8.2.
8.3. Indemnification. To the extent provided in the Company’s Certificate of Incorporation or Bylaws, as in effect from time to time, and subject to any separate agreement (if any) between the Company and the Executive regarding indemnification, the Company shall indemnify the Executive for losses or damages incurred by the Executive as a result of causes of
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action arising from the Executive’s performance of duties for the benefit of the Company, whether or not the claim is asserted during the Term. In addition, the Executive shall participate in directors and officers insurance, if any, maintained by the Company from time to time on the same terms and conditions as other senior executives or directors of the Company.
8.4. Assignment. This Employment Agreement, and the Executive’s rights and obligations hereunder, may not be assigned by the Executive, and any purported assignment by the Executive in violation hereof shall be null and void.
8.5. Payments Following Executive’s Death. Any amounts payable to the Executive pursuant to this Employment Agreement that remain unpaid at the Executive’s death shall be paid to the Pytosh-Pyun 2024 Management Trust.
8.6. Notices. Unless otherwise provided herein, all notices, requests, demands, claims and other communications provided for under the terms of this Employment Agreement shall be in writing. Any notice, request, demand, claim or other communication hereunder shall be sent by (i) personal delivery (including receipted courier service) or overnight delivery service, (ii) facsimile during normal business hours, with confirmation of receipt, to the number indicated, (iii) reputable commercial overnight delivery service courier or (iv) registered or certified mail, return receipt requested, postage prepaid and addressed to the intended recipient as set forth below:
If to the Company: CVR ENERGY, INC.
2277 Plaza Drive, Suite 500
Sugar Land, TX 77479
Attention: General Counsel
2277 Plaza Drive, Suite 500
Sugar Land, TX 77479
Attention: General Counsel
If to the Executive: the Executive’s last address reflected on the Company’s records,
or to such other address as either party shall have furnished to the other in writing in accordance herewith.
All such notices, requests, consents and other communications shall be deemed to have been given when received. Any party may change its facsimile number or its address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other party hereto notice in the manner then set forth.
8.7. Governing Law. This Employment Agreement shall be governed and interpreted and the rights of the parties determined in accordance with the laws of the United States applicable thereto and the internal laws of the State of Texas without giving effect to the conflict of laws principles thereof. Any unresolved dispute arising out of this Employment Agreement shall be litigated solely in any court of competent jurisdiction in the State of Texas; provided, that the Company may elect to pursue a court action to seek injunctive relief in any court of competent jurisdiction to terminate the violation of its proprietary rights, including but not limited to trade secrets, copyrights or trademarks.
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8.8. Waiver of Jury Trial. THE PARTIES HERETO AGREE TO WAIVE THE RIGHT TO A TRIAL BY JURY. THIS WAIVER IS KNOWINGLY, INTENTIONALLY, AND VOLUNTARILY MADE BY THE EXECUTIVE, AND THE EXECUTIVE ACKNOWLEDGES THAT, EXCEPT FOR THE COMPANY’S AGREEMENT TO LIKEWISE WAIVE ITS RIGHTS TO A TRIAL BY JURY (WHICH THE COMPANY HEREBY MAKES), THE COMPANY HAS NOT MADE ANY REPRESENTATIONS OF FACTS TO INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. THE EXECUTIVE FURTHER ACKNOWLEDGES THAT HE HAS READ AND UNDERSTANDS THE MEANING AND RAMIFICATIONS OF THIS WAIVER AND AS EVIDENCE OF THIS FACT SIGNS THIS EMPLOYMENT AGREEMENT BELOW.
8.9. Severability. If any paragraph or part or subpart of any paragraph in this Employment Agreement or the application thereof is construed to be overbroad and/or unenforceable, then the court making such determination shall have the authority to narrow the paragraph or part or subpart of the paragraph as necessary to make it enforceable and the paragraph or part or subpart of the paragraph shall then be enforceable in its/their narrowed form. Moreover, each paragraph or part or subpart of each paragraph in this Employment Agreement is independent of and severable (separate) from each other. In the event that any paragraph or part or subpart of any paragraph in this Employment Agreement is determined to be legally invalid or unenforceable by a court and is not modified by a court to be enforceable, the affected paragraph or part or subpart of such paragraph shall be stricken from this Employment Agreement, and the remaining paragraphs or parts or subparts of such paragraphs of this Employment Agreement shall remain in full force and effect.
8.10. Entire Agreement. From and after the Effective Date, this Employment Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof, and supersedes all prior representations, agreements and understandings, both written and oral, relating to any employment of the Executive by the Company or any of its Affiliates, including, without limitation, the Change in Control and Severance Plan Participation Agreement by and between the Executive and the Company.
8.11. Counterparts. This Employment Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all such counterparts shall together constitute one and the same instrument.
8.12. Binding Effect. The terms of this Employment Agreement shall be binding upon the Executive, the Executive’s heirs, executors, assigns, administrators and legal representatives, and shall inure to the benefit of the Company and its successors and assigns, including, without limitation, any successor to all or substantially all of the business and/or assets of the Company.
8.13. General Interpretive Principles. The name assigned this Employment Agreement and headings of the sections, paragraphs, subparagraphs, clauses and subclauses of this Employment Agreement are for convenience of reference only and shall not in any way affect the meaning or interpretation of any of the provisions hereof. Words of inclusion shall not
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be construed as terms of limitation herein, so that references to “include”, “includes” and “including” shall not be limiting and shall be regarded as references to non-exclusive and non-characterizing illustrations.
8.14. Mitigation. Notwithstanding any other provision of this Employment Agreement, (a) the Executive will have no obligation to mitigate damages for any breach or termination of this Employment Agreement by the Company, whether by seeking employment or otherwise and (b) the amount of any payment or benefit due the Executive after the date of such breach or termination will not be reduced or offset by any payment or benefit that the Executive may receive from any other source.
8.15. Company Actions. Any actions, approvals, decisions, or determinations to be made by the Company under this Employment Agreement shall be made by the Board, except as otherwise expressly provided herein. For purposes of any references herein to the Board’s designee, any such reference shall be deemed to include such officers of the Company, or committees of the Board, as the Board may expressly designate from time to time for such purpose.
8.16. Survival. All provisions of this Employment Agreement which by their terms contain continuing obligations shall survive termination of this Employment Agreement, including without limitation, the covenants, duties and obligations under Sections 3.2, 3.4, 3.5 and 4 hereof.
8.17. Assumption of Agreement By Successor. In the event of a Change in Control, the Company will request that any successor expressly assume and agree, pursuant to an appropriate written assumption agreement, to perform the Company’s obligations under this Employment Agreement in substantially the same manner and to substantially the same extent that the Company would be required to perform if no such Change in Control had taken place.
8.18. Definitions. In addition to the defined terms set forth throughout this Employment Agreement, the capitalized terms set forth on Appendix A shall have the respective meanings set forth thereon and are incorporated by reference into this Employment Agreement.
8.19. Clawback. Notwithstanding herein to the contrary, the Executive acknowledges and agrees that any compensation or benefits paid to the Executive shall be subject to the Company’s Policy for the Recovery of Erroneously Awarded Compensation or such similar policy adopted by the Company from time to time and in effect during the Term (the “Clawback Policy”) and the Executive shall take all action necessary or appropriate to comply with the Clawback Policy. Should a conflict exist between this Employment Agreement and the Clawback Policy, the Clawback Policy shall control.
[signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement as of the date first written above.
| /s/ Mark A. Pytosh | CVR ENERGY, INC. /s/ Melissa M. Buhrig | |||||||
| MARK A. PYTOSH | By: Melissa M. Buhrig Title: Executive Vice President, General Counsel and Secretary | |||||||
[Signature Page to Employment Agreement – M. Pytosh]
APPENDIX A
Definitions
Definitions
“Affiliate” means any Person that a Person either directly or indirectly through one or more intermediaries is in common control with, is controlled by or controls, each within the meaning of the Securities Act of 1933, as amended.
“Cause” means that the Executive has engaged in any of the following: (i) willful failure of the Executive to perform substantially his duties (other than any such failure resulting from incapacity due to Disability); (ii) commission of, or indictment for, a felony or any crime involving fraud or embezzlement or dishonestly or conviction of, or plea of guilty or nolo contendere to a crime or misdemeanor (other than a traffic violation) punishable by imprisonment under federal, state or local law; (iii) engagement in an act of fraud or other act of willful dishonesty or misconduct, towards the Company or any Affiliate, or detrimental to the Company or any Affiliate, or in the performance of the Executive’s duties; (iv) negligence in the performance of the Executive’s employment duties that has a detrimental effect on the Company or any Affiliate; (v) violation of a federal or state securities law or regulation; (vi) the use of a controlled substance without a prescription or the use of alcohol which, in each case, significantly impairs the Executive’s ability to carry out his duties and responsibilities; (vii) material violation of the policies and procedures of the Company or any Affiliate; (viii) embezzlement and/or misappropriation of property of the Company or any Affiliate; (ix) conduct involving any immoral acts which is reasonably likely to impair the reputation of the Company or any Affiliate; or (x) material breach of the covenants set forth in Section 4 after written notice of such breach and failure by the Executive to cure such breach within ten (10) business days; provided, however, that no such notice of, nor opportunity to cure, such breach shall be required hereunder if the breach cannot be cured by the Executive.
“Change in Control” means the occurrence of any of the following:
(a) An acquisition (other than directly from the Company) of any voting securities of the Company (the “Voting Securities”) by any “Person” (as the term “person” is used for purposes of Section 13(d) or 14(d) of the Exchange Act), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than fifty percent (50%) of (i) the then-outstanding Shares or (ii) the combined voting power of the Company’s then-outstanding Voting Securities; provided, however, that in determining whether a Change in Control has occurred pursuant to this paragraph (a), the acquisition of Shares or Voting Securities in a Non-Control Acquisition (as hereinafter defined) shall not constitute a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (A) the Company or (B) any Subsidiary, (ii) the Company, any Principal Stockholder or any Subsidiary, or (iii) any Person in connection with a Non-Control Transaction (as hereinafter defined);
(b) The consummation of:
(i) A merger, consolidation or reorganization of a Person (x) with or into the Company or (y) in which securities of the Company are issued (a “Merger”), unless such Merger is a “Non-Control Transaction.” A “Non-Control Transaction” shall mean a Merger in which:
(A) the shareholders of the Company immediately before such Merger, or one or more Principal Stockholders, own directly or indirectly immediately following such Merger at least a majority of the combined voting power of the outstanding voting securities of (1) the corporation resulting from such Merger (the “Surviving Corporation”), if fifty percent (50%) or more of the combined voting power of the then outstanding voting securities by the Surviving Corporation is not Beneficially Owned, directly or indirectly, by another Person (a “Parent Corporation”) or (2) if there is one or more than one Parent Corporation, the ultimate Parent Corporation;
(B) the individuals who were members of the Board immediately prior to the execution of the agreement providing for such Merger constitute at least a majority of the members of the board of directors of (1) the Surviving Corporation, if there is no Parent Corporation, or (2) if there is one or more than one Parent Corporation, the ultimate Parent Corporation; and
(C) no Person other than (1) the Company or another corporation that is a party to the agreement of Merger, (2) any Subsidiary, (3) any employee benefit plan (or any trust forming a part thereof) that, immediately prior to the Merger, was maintained by the Company or any Subsidiary, (4) any Person who, immediately prior to the Merger, had Beneficial Ownership of thirty percent (30%) or more of the then outstanding Shares or Voting Securities, or (5) any Principal Stockholder, has Beneficial Ownership, directly or indirectly, of fifty percent (50%) or more of the combined voting power of the outstanding voting securities or common stock of (x) the Surviving Corporation, if there is no Parent Corporation, or (y) if there is one or more than one Parent Corporation, the ultimate Parent Corporation.
(ii) A complete liquidation or dissolution of the Company; or
(iii) The sale or other disposition of all or substantially all of the assets of the Company and its Subsidiaries taken as a whole to any Person (other than (x) a sale or transfer to a Subsidiary or a Principal Stockholder (or one or more Principal Stockholders acting together) or (y) the distribution to the Company’s shareholders of the stock of a Subsidiary or any other assets).
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the then outstanding Shares or Voting Securities as a result of the acquisition of Shares or Voting Securities by the Company which, by reducing the number of Shares or Voting Securities then outstanding, increases the proportional number of shares Beneficially Owned by the Subject Persons; provided, that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Shares or Voting Securities by the Company and,
after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Shares or Voting Securities and such Beneficial Ownership increases the percentage of the then outstanding Shares or Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur.
Notwithstanding anything contained herein to the contrary, to the extent that payment of any amounts pursuant to this Employment Agreement constitutes non-qualified deferred compensation pursuant to Section 409A of the Code and payment of such amounts is required to be made upon, or within a specified time following, the consummation of a Change in Control, payment with respect to such amounts shall be made solely upon the occurrence of a “change in control event” as such term is defined in Treasury Regulation Section 1.409A-3(i)(5)(i) or such other time permitted under Section 409A of the Code.
“Change in Control Period” means the time period beginning on the date that is one hundred twenty (120) days prior to the first Change in Control occurring after the Effective Date and ending on the date that is twenty-four (24) months following the date of such Change in Control.
“Code” means the Internal Revenue Code of 1986, as amended.
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of management and policies of a Person, whether through the ownership of stock, by agreement or otherwise and “Controlled” has a corresponding meaning.
“Disability” means that: (i) the Executive is unable to perform his duties hereunder as a result of illness or physical injury for a period of at least ninety (90) days; (ii) the Executive is entitled to receive payments under the Company’s long-term disability insurance plan; (iii) the Executive has started to receive such disability insurance payments; and (iv) no person has contested or questioned the Executive’s right to receive such payments or, if such payments have been contested, the Company has irrevocably and unconditionally agreed to pay the Executive such amounts as will net to the Executive after reduction for applicable federal and state income taxes the same amount as he would have received after such taxes from such insurance.
“Good Reason” means a resignation by the Executive within thirty (30) days following the date on which the Company has engaged in any of the following (each a “Good Reason Event”): (i) the assignment of duties or responsibilities to the Executive that reflect a material diminution of the Executive’s position with the Company; provided, however, that the hiring of a chief executive officer by CVR GP, LLC or UAN shall not be a Good Reason Event if, immediately thereafter, the Executive is the executive chairman of CVR GP, LLC or UAN, respectively; (ii) a relocation of the Executive’s principal place of employment to a location more than 50 miles from the Company’s current headquarters in Sugar Land, Texas; or (iii) a reduction in the Executive’s Base Salary, other than across-the-board reductions applicable to similarly situated employees of the Company.
“IEP” means Icahn Enterprises L.P.
“Incentive / Phantom Unit Awards” means any outstanding cash-settled incentive or phantom unit award granted to the Executive by the Company or its Affiliates, and any other awards approved by the Compensation Committee at the time of the award.
“Person” or “person,” means any individual, partnership, limited partnership, corporation, limited liability company, trust, foundation, estate, cooperative, association (except his homeowners association, if any), organization, proprietorship, firm, joint venture, joint stock company, syndicate, company, committee, government or governmental subdivision or agency, or other entity, whether or not conducted for profit.
“Principal” means Carl Icahn.
“Principal Stockholder” means any of IEP Energy LLC, any Affiliate of IEP Energy LLC, the Principal and any Related Party.
“Related Party” means (1) the Principal and his siblings, his and their respective spouses and descendants (including stepchildren and adopted children) and the spouses of such descendants (including stepchildren and adopted children) (collectively, the “Family Group”); (2) any trust, estate, partnership, corporation, company, limited liability company or unincorporated association or organization (each, an “Entity” and collectively “Entities”) Controlled by one or more members of the Family Group; (3) any Entity over which one or more members of the Family Group, directly or indirectly, have rights that, either legally or in practical effect, enable them to make or veto significant management decisions with respect to such Entity, whether pursuant to the constituent documents of such Entity, by contract, through representation on a board of directors or other governing body of such Entity, through a management position with such Entity or in any other manner (such rights, hereinafter referred to as “Veto Power”); (4) the estate of any member of the Family Group; (5) any trust created (in whole or in part) by any one or more members of the Family Group; (6) any individual or Entity who receives an interest in any estate or trust listed in clauses (4) or (5), to the extent of such interest; (7) any trust or estate, substantially all the beneficiaries of which (other than charitable organizations or foundations) consist of one or more members of the Family Group; (8) any organization described in Section 501(c) of the Code, over which any one or more members of the Family Group and the trusts and estates listed in clauses (4), (5) and (7) have direct or indirect Veto Power, or to which they are substantial contributors (as such term is defined in Section 507 of the Code); (9) any organization described in Section 501(c) of the Code of which a member of the Family Group is an officer, director or trustee; or (10) any Entity, directly or indirectly (a) owned or Controlled by or (b) a majority of the economic interests in which are owned by, or are for or accrue to the benefit of, in either case, any Person or Persons identified in clauses (1) through (9) above. For the purposes of this definition, and for the avoidance of doubt, in addition to any Person or Persons that may be considered to possess Control, (x) a partnership shall be considered Controlled by a general partner or managing general partner thereof, (y) a limited liability company shall be considered Controlled by a managing member of such limited liability company and (z) a trust or estate shall be considered Controlled by any trustee, executor, personal representative, administrator or any other Person or Persons having authority over the control, management or disposition of the income and assets therefrom.
“Shares” means the common stock, par value $.01 per share, of the Company and any other securities into which such shares are changed or for which such shares are exchanged.
“Significant CVI Transaction” means the first to occur of (i) the sale or other disposition of all or substantially all of the assets of the Company and its Subsidiaries taken as a whole to any Person (other than (x) a sale or transfer to an Affiliate or a Principal Stockholder (or one or more Principal Stockholders acting together) or (y) the distribution to the Company’s stockholders of the stock of a Subsidiary or any other assets), (ii) a material acquisition by the Company of an unrelated third-party entity (with respect to which, “material” is measured by reference to the Company and not such unrelated third-party entity), or (iii) a transaction that results in IEP owning 40% or less of the interests of the Company (such as, a transaction in which the Company sells its interests in UAN to IEP in exchange for shares of the Company), in each case, as determined by the Board in accordance with the terms and conditions of this Employment Agreement in its good faith discretion. For the avoidance of doubt, a gradual sell-down by IEP of its interests in the Company shall not constitute a Significant CVI Transaction. For the avoidance of doubt, only one Transaction Bonus with respect to a Significant CVI Transaction shall be paid to the Executive, subject to and in accordance with this Employment Agreement.
“Significant Transaction” means a Significant CVI Transaction or a Significant UAN Transaction.
“Significant UAN Transaction” means the first to occur, in any case, prior to the occurrence of a sale or other disposition of all or substantially all of the assets of the Company and its Subsidiaries taken as a whole to any Person (other than (x) a sale or transfer to an Affiliate or a Principal Stockholder (or one or more Principal Stockholders acting together) or (y) the distribution to the Company’s stockholders of the stock of a Subsidiary or any other assets), of (i) purchase by the Company or one of its Affiliates of a majority of the interests in UAN, (ii) the acquisition of UAN or the interests therein held by the Company by a third party (including, without limitation, by IEP or its Affiliates), (iii) a spin-off transaction of UAN, in each case, as determined by the Board in accordance with the terms and conditions of this Employment Agreement in its good faith discretion, or (iv) a material acquisition of an unrelated third-party entity or the assets thereof by UAN or one of its Affiliates (with respect to which, “material” is measured by reference to UAN and not such unrelated third-party entity), in each case, as determined by the Board in accordance with the terms and conditions of this Employment Agreement in its good faith discretion. For the avoidance of doubt, only one Transaction Bonus with respect to a Significant UAN Transaction shall be paid to the Executive, subject to and in accordance with this Employment Agreement, provided, however, that the Executive shall not be paid a Transaction Bonus with respect to a Significant UAN Transaction that occurs following the sale of the Company to a third-party.
“Subsidiary” means any corporation or other person the majority of the voting power, voting equity securities or equity interest of which is owned, directly or indirectly, by the Company.
“Transaction Bonus” means (i) with respect to a Significant CVI Transaction, $10,000,000 and (ii) with respect to a Significant UAN Transaction, $2,500,000.
Exhibit 31.1
Certification of President and Chief Executive Officer Pursuant to
Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934,
As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, David L. Lamp, certify that:
1.I have reviewed this report on Form 10-Q of CVR Energy, Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| By: | /s/ DAVID L. LAMP | ||||
| David L. Lamp | |||||
| President and Chief Executive Officer | |||||
| (Principal Executive Officer) | |||||
Date: July 31, 2025
Exhibit 31.2
Certification of Executive Vice President, Chief Financial Officer, Treasurer and Assistant Secretary
Pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934,
As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Dane J. Neumann, certify that:
1.I have reviewed this report on Form 10-Q of CVR Energy, Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| By: | /s/ DANE J. NEUMANN | ||||
| Dane J. Neumann | |||||
| Executive Vice President, Chief Financial Officer, Treasurer and Assistant Secretary | |||||
| (Principal Financial Officer) | |||||
Date: July 31, 2025
Exhibit 31.3
Certification of Vice President, Chief Accounting Officer and Corporate Controller
Pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934,
As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Jeffrey D. Conaway, certify that:
1.I have reviewed this report on Form 10-Q of CVR Energy, Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
| By: | /s/ JEFFREY D. CONAWAY | ||||
| Jeffrey D. Conaway | |||||
| Vice President, Chief Accounting Officer and Corporate Controller | |||||
| (Principal Accounting Officer) | |||||
Date: July 31, 2025
Exhibit 32.1
Certification Pursuant to 18 U.S.C. Section 1350,
As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the filing of the Quarterly Report of CVR Energy, Inc., a Delaware corporation (the "Company"), on Form 10-Q for the fiscal quarter ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned officers of the Company certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of such officer's knowledge and belief:
1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
| By: | /s/ DAVID L. LAMP | ||||
| David L. Lamp | |||||
| President and Chief Executive Officer | |||||
| (Principal Executive Officer) | |||||
| By: | /s/ DANE J. NEUMANN | ||||
| Dane J. Neumann | |||||
| Executive Vice President, Chief Financial Officer, Treasurer and Assistant Secretary | |||||
| (Principal Financial Officer) | |||||
| By: | /s/ JEFFREY D. CONAWAY | ||||
| Jeffrey D. Conaway | |||||
| Vice President, Chief Accounting Officer and Corporate Controller | |||||
| (Principal Accounting Officer) | |||||
Dated: July 31, 2025