Document:

EX-10.1

 

Exhibit
10.11

Execution Copy

 

 

OMNIBUS AGREEMENT

among

CVR ENERGY, INC.

CVR GP, LLC

CVR PARTNERS, LP

and

CVR SPECIAL GP, LLC

 

 

 

 

OMNIBUS AGREEMENT

     THIS OMNIBUS AGREEMENT (this “Agreement”) is entered into as of October 24, 2007, and
effective as of the Closing Date (as defined herein), and is by and among CVR Energy, Inc., a
Delaware corporation (“CVR”), CVR GP, LLC, a Delaware limited liability company (the “Managing
General Partner”), CVR Partners, LP, a Delaware limited partnership (the “Partnership”) and CVR
Special GP, LLC, a Delaware limited liability company (“Special General Partner”). The above-named
entities are sometimes referred to in this Agreement each as a “Party” and collectively as the
“Parties.”

R E C I T A L S:

     The Parties desire by their execution of this Agreement to evidence their agreement, as more
fully set forth in Article II, with respect to those business opportunities that the CVR Entities
(as defined herein) will not engage in during the term of this Agreement unless the Partnership
Entities have declined to engage in any such business opportunities for their own account.

     The Parties desire by their execution of this Agreement to evidence their agreement, as more
fully set forth in Article II, with respect to those business opportunities that the Partnership
Entities (as defined herein) will not engage in during the term of this Agreement unless the CVR
Entities have declined to engage in any such business opportunities for their own account.

     In consideration of the premises and the covenants, conditions, and agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Definitions.

     Capitalized terms used herein but not defined shall have the meanings given them in the
Partnership Agreement. As used in this Agreement, the following terms shall have the respective
meanings set forth below:

     “Acquiring Party” is defined in Section 2.5(a).

     “Affiliate” is defined in the Partnership Agreement.

“Break-up Costs” means the aggregate amount of any and all additional taxes and other
similar costs to (a) the CVR Entities that would be required to transfer Fertilizer Assets
acquired by the CVR Entities as part of a larger transaction to a Partnership Group Member
pursuant to Section 2.2(b) or (b) the Partnership Group that would be required to transfer
Refinery Assets acquired by the Partnership Group as part of a larger transaction to a CVR
Entity pursuant to Section 2.4(a).

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“Closing Date” is defined in the Partnership Agreement.

“Code” means Internal Revenue Code of 1986, as amended.

“Contribution Agreement” means that certain Contribution, Conveyance and Assumption
Agreement, dated as of the date hereof, among the Managing General Partner, the Partnership,
the Special General Partner and Coffeyville Resources, together with the additional
conveyance documents and instruments contemplated or referenced thereunder.

“control” means the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership of voting
securities, by contract, or otherwise.

“CVR” is defined in the introduction to this Agreement.

“CVR Entities” means CVR and any Person controlled, directly or indirectly, by CVR other
than the Partnership Entities.

“CVR Entity” means any of the CVR Entities.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Fertilizer Restricted Businesses” is defined in Section 2.1.

“Fertilizer Asset” any asset or group of related assets used in any Fertilizer Restricted
Business.

“Limited Partner” is defined in the Partnership Agreement.

“Managing General Partner” is defined in the introduction to this Agreement.

“Offer Period” is defined in Section 2.5(e).

“Offered Assets” is defined in Section 2.5(a).

“Offeree” is defined in Section 2.5(a).

“Other Business Opportunity” means a business opportunity with respect to any assets other
than Fertilizer Assets or Refinery Assets.

“Other Business Opportunity Information” is defined in Section 2.6.

“Partnership Agreement” means the First Amended and Restated Agreement of Limited
Partnership of CVR Partners, LP, dated as of October 26, 2007, as such agreement is in
effect on the Closing Date, to which reference is hereby made for all purposes of this
Agreement. No amendment or modification to the Partnership Agreement subsequent to the
Closing Date shall be given effect for the purposes of this Agreement unless consented to in
writing by each of the Parties to this Agreement.

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“Partnership Entities” means the Managing General Partner and each member of the Partnership
Group.

“Partnership Entity” means any of the Partnership Entities.

“Partnership Group” means the Partnership and its Subsidiaries treated as a single entity.

“Partnership Group Member” means any member of the Partnership Group.

“Party” and “Parties” are defined in the introduction to this Agreement.

“Person” means an individual or a corporation, limited liability company, partnership, joint
venture, trust, unincorporated organization, association, government agency or political
subdivision thereof or other entity.

“Refinery Restricted Businesses” is defined in Section 2.3.

“Refinery Asset” means any asset or group of related assets used in any Refinery Restricted
Business.

“Restricted Business” means, as applicable, the Refinery Restricted Business or the
Fertilizer Restricted Business.

“Retained Assets” means any assets and investments owned or operated by any of the CVR
Entities as of the Closing Date that were not conveyed, contributed or otherwise transferred
to the Partnership Group prior to or on the Closing Date pursuant to the Contribution
Agreement or otherwise.

“Special General Partner” is defined in the introduction to this Agreement.

“Special General Partner Interest” is defined in the Partnership Agreement.

“Subsidiary” means, with respect to any Person, (a) a corporation of which more than 50% of
the voting power of shares entitled (without regard to the occurrence of any contingency) to
vote in the election of directors or other governing body of such corporation is owned,
directly or indirectly, at the date of determination, by such Person, by one or more
Subsidiaries of such Person or a combination thereof, (b) a partnership (whether general or
limited) in which such Person or a Subsidiary of such Person is, at the date of
determination, a general or limited partner of such partnership, but only if more than 50%
of the partnership interests of such partnership (considering all of the partnership
interests of the partnership as a single class) is owned, directly or indirectly, at the
date of determination, by such Person, by one or more Subsidiaries of such Person, or a
combination thereof, or (c) any other Person (other than a corporation or a partnership) in
which such Person, one or more Subsidiaries of such Person, or a combination thereof,
directly or indirectly, at the date of determination, has (i) at least a majority ownership
interest or (ii) the power to elect or direct the election of a majority of the directors or
other governing body of such Person.

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“transfer” including the correlative terms “transferring” or “transferred” means any
direct or indirect transfer, assignment, sale, gift, pledge, hypothecation or other
encumbrance, or any other disposition (whether voluntary, involuntary or by operation of
law) of any assets, properties or rights.

ARTICLE II

BUSINESS OPPORTUNITIES

     Section 2.1 Fertilizer Restricted Businesses. For so long as any CVR Entity continues to own at least 50% of the Outstanding Units of the
Partnership, and except as permitted by Section 2.2, each of the CVR Entities shall be prohibited
from engaging in, whether by acquisition, construction, investment in debt or equity securities of
any Person or otherwise, any business having assets engaged in the following businesses (the
"Fertilizer Restricted Businesses”): the production, transportation or distribution, on a wholesale
basis, of fertilizer in the contiguous United States.

     Section 2.2 Fertilizer Permitted Exceptions. Notwithstanding any provision of Section 2.1 to the contrary, the CVR Entities may engage in the
following activities under the following circumstances:

     (a) the ownership and/or operation of any of the Retained Assets (including replacements and
natural extensions of the Retained Assets);

     (b) engaging in any Fertilizer Restricted Business acquired by a CVR Entity as part of a
business or package of assets after the Closing Date if the fair market value of the Fertilizer
Assets represents less than a majority of the fair market value of the total assets or business
acquired (fair market value as determined in good faith by the board of directors of CVR); provided
the Partnership Group will be offered the opportunity to acquire such Fertilizer Assets in
accordance with Section 2.5;

     (c) engaging in any Fertilizer Restricted Business subject to the offer to the Partnership
Group set forth in Section 2.5 pending the Managing General Partner’s determination whether to
cause any Partnership Group Member to accept such offer and pending the closing of any offers any
Partnership Group Member accepts;

     (d) engaging in any Fertilizer Restricted Business with respect to which the Managing General
Partner has advised CVR that the Managing General Partner’s board of directors has elected not to
cause a Partnership Group Member to acquire (or seek to acquire); and

     (e) the purchase and ownership of up to 9.9% of any class of securities of any publicly-traded
entity engaged in any Fertilizer Restricted Business.

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     Section 2.3 Refinery Restricted Businesses. For so long as any CVR Entity continues to own at least 50% of the Outstanding Units of the
Partnership and except as permitted by Section 2.4, each of the Partnership Entities shall be
prohibited from, whether by acquisition, construction, investment in debt or equity securities of
any Person or otherwise, engaging in the following businesses (the “Refinery Restricted
Businesses”):

     (a) the ownership or operation within the United States of any refinery with processing
capacity greater than 20,000 barrels per day whose primary business is producing transportation
fuels; or

     (b) the ownership or operation outside the United States of any refinery.

     Section 2.4 Refinery Permitted Exceptions. Notwithstanding any provision of Section 2.3 to the contrary, the Partnership Entities may
engage in the following activities under the following circumstances:

     (a) engaging in any Refinery Restricted Business acquired by a Partnership Entity as part of a
business or package of assets after the Closing Date if the fair market value of the Refinery
Assets represents less than a majority of the fair market value of the total assets or business
acquired (fair market value as determined in good faith by the board of directors of the Managing
General Partner); provided the CVR Entities will be offered the opportunity to acquire such
Refinery Assets in accordance with Section 2.5;

     (b) engaging in any Refinery Restricted Business subject to the offer to the CVR Entities set
forth in Section 2.5 pending CVR’s determination whether to cause any CVR Entity to accept such
offer and pending the closing of any offers any Partnership Entity accepts;

     (c) engaging in any Refinery Restricted Business with respect to which CVR has advised the
Managing General Partner that CVR’s board of directors has elected not to cause a CVR Entity to
acquire (or seek to acquire); and

     (d) the purchase and ownership of up to 9.9% of any class of securities of any publicly-traded
entity engaged in any Refinery Restricted Business.

     Section 2.5 Procedures.

     (a) In the event that (i) a CVR Entity acquires Fertilizer Assets described in Section 2.2(b),
or (ii) a Partnership Group Member acquires any Refinery Assets described in Section 2.4(a), then
as soon as reasonably practicable, but in any event within 365 days of the closing of the
acquisition, such acquiring Party (the “Acquiring Party”) shall notify (A) the Managing General
Partner, in the case of an acquisition by a CVR Entity or (B) CVR, in the case of an acquisition by
a Partnership Group Member, in writing of such acquisition and offer such party to be notified
(each an “Offeree”) the opportunity for the Offeree (or, in the case of the Managing General
Partner, any Partnership Group Member and, in the case of CVR, any other CVR Entity) to purchase
such Fertilizer Assets or Refinery Assets, as applicable (the “Offered Assets”).

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     (b) The purchase price for any Offered Assets shall be the Offered Assets’ fair market value
(plus any Break-up Costs).

     (c) The Offer shall set forth the Acquiring Party’s proposed terms relating to the purchase of
the Offered Assets by the Offeree (or, in the case of the Managing General Partner, any Partnership
Group Member and, in the case of CVR, any other CVR Entity), including any liabilities to be
assumed by the Offeree as part of the Offer.

     (d) As soon as practicable after the Offer is made, the Acquiring Party will deliver to the
Offeree all information prepared by or on behalf of or in the possession of such Acquiring Party
relating to the Offered Assets and reasonably requested by the Offeree. As soon as practicable,
but in any event, within 90 days after receipt of such notification, the Offeree shall notify the
Acquiring Party in writing that either

     (i) the Offeree has elected not to purchase (or not to cause any of its permitted
Affiliates to purchase) the Offered Assets, in which event the Acquiring Party and its
Affiliates shall, subject to the other terms of this Agreement, be forever free to continue
to own or operate such Offered Assets; or

     (ii) the Offeree has elected to purchase (or to cause any of its permitted Affiliates
to purchase) the Offered Assets, in which event the procedures set forth in Section 2.5(e)
shall be followed.

     (e) In the event of a proposed purchase pursuant to Section 2.5(d)(ii):

     (i) After the receipt of the Offer by the Offeree, the Acquiring Party and the Offeree
shall negotiate in good faith to agree upon the fair market value (and any Break-up Costs)
of the Offered Assets that are subject to the Offer and the other terms of the Offer on
which the Offered Assets will be sold to the Offeree. If the Acquiring Party and the
Offeree agree on the fair market value of the Offered Assets that are subject to the Offer
and the other terms of the Offer during the 30-day period after receipt by the Acquiring
Party of the Offeree’s election to purchase (or to cause any permitted Affiliate of the
Offeree to purchase) the Offered Assets (the “Offer Period”), the Offeree shall purchase (or
cause any of its permitted Affiliates to purchase) the Offered Assets on such terms as soon
as commercially practicable after such agreement has been reached.

     (ii) If the Acquiring Party and the Offeree are unable to agree on the fair market
value (and any Break-up Costs) of the Offered Assets that are subject to the Offer or on any
other terms of the Offer during the Offer Period, the Acquiring Party and the Offeree will
engage an independent investment banking firm or other appraisal firm to determine the fair
market value (and any Break-up Costs) of the Offered Assets and/or the other terms on which
the Acquiring Party and the Offeree are unable to agree. In determining the fair market
value of the Offered Assets and other terms on which the Offered Assets are to be sold, the
investment banking firm or other appraisal firm will have access to the proposed sale and
purchase values and terms for the Offer submitted by the Acquiring Party and the Offeree,
respectively, and to all information prepared by or on behalf of the Acquiring Party
relating to the Offered Assets and reasonably

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requested by such investment banking firm or other appraisal firm and shall be
permitted to consider the purchase price paid by the Acquiring Party for the Offered Assets.
Such investment banking firm or other appraisal firm will determine the fair market value
(and any Break-up Costs) of the Offered Assets and/or the other terms on which the Acquiring
Party and the Offeree are unable to agree within 60 days of its engagement and furnish the
Acquiring Party and the Offeree its determination. The fees and expenses of the investment
banking firm will be divided equally between the Acquiring Party and the Offeree. Upon
receipt of such determination, the Offeree will have the option, but not the obligation, to
purchase the Offered Assets for the fair market value (and any Break-up Costs) and on the
other terms determined by the investment banking firm or other appraisal firm, as soon as
commercially practicable after determinations have been made. The Offeree will provide
written notice of its decision to the Acquiring Party within 30 days after the investment
banking firm or other appraisal firm has submitted its determination and if the Offerree.
Failure to provide such notice within such 30-day period shall be deemed to constitute a
decision not to purchase the Offered Assets. If the Offeree decides to purchase the Offered
Assets the Offeree shall purchase (or cause any of its permitted Affiliates to purchase) the
Offered Asset as soon as commercially practicable after it has provided such notice.

     Section 2.6 Other Business Opportunities. For so long as any CVR Entity continues to own at least 50% of the Outstanding Units of the
Partnership and except as permitted by Section 2.4, if any CVR Entity is presented with an
opportunity to pursue, purchase or invest in any Other Business Opportunity, such CVR Entity shall
give prompt written notice to the Managing General Partner, of the Other Business Opportunity.
Such notice shall set forth all information available to any CVR Entity including, but not limited
to, the identity of the Other Business Opportunity and its seller, the proposed price, all written
information about the Other Business Opportunity provided to any CVR Entity by and on behalf of the
seller as well as any information or analyses compiled by any CVR Entity from other sources (such
information referred to collectively herein as “Other Business Opportunity Information”). The CVR
Entities shall continue to provide to the Managing General Partner, promptly any and all Other
Business Opportunity Information subsequently received. The Parties shall maintain the
confidentiality of all such Other Business Opportunity Information, subject to compliance with
applicable law. As soon as practicable but in any event within thirty (30) days after receipt of
such initial notification and information, the Managing General Partner, on behalf of the
Partnership Group, shall notify CVR that either (a) the Managing General Partner has elected to
cause a member of the Partnership Group to pursue the opportunity to acquire or invest in the Other
Business Opportunity or (b) the Managing General Partner has elected not to cause a member of the
Partnership Group to pursue the opportunity to acquire or invest in the Other Business Opportunity.
If, at any time, the Managing General Partner or the Partnership Group Member abandons such
opportunity (as evidenced in writing by the Managing General Partner following the request of any
CVR Entity), any CVR Entity may pursue such opportunity without time limit. In no event shall any
provision of this Agreement require the Managing General Partner to approve any expansion of the
purpose of the Partnership, other than in its sole discretion, as set forth in Section 2.4 of the
Partnership Agreement.

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     Section 2.7 Scope of Prohibition. If any CVR Entity or Partnership Entity engages in a Restricted Business pursuant to any of the
exceptions described in Section 2.2 or Section 2.4, as applicable, such CVR Entity or Partnership
Entity may not subsequently expand that portion of their business except (i) pursuant to the
exceptions contained in such Sections Section 2.2 or Section 2.4 or (ii) to maintain or improve
their facilities comprising the Restricted Business or to expand their facilities with additional
facilities or assets that are physically connected, in a material manner, with the existing
facilities comprising the Restricted Business. Except as otherwise provided in this Agreement and
the Partnership Agreement, each CVR Entity and Each Partnership Entity shall be free to engage in
any business activity whatsoever, including those that may be in direct competition with the CVR
Entities or the Partnership Group

     Section 2.8 Enforcement. Each Party agrees and acknowledges that the other Parties do not have an adequate remedy at law
for the breach by any Party of its covenants and agreements set forth in this Article II, and that
any breach by any Party of its covenants and agreements set forth in this Article II would result
in irreparable injury to the other Parties. Each Party further agrees and acknowledges that any
other Party may, in addition to the other remedies which may be available to such other Party, file
a suit in equity to enjoin the breaching Party from such breach, and consent to the issuance of
injunctive relief relating to this Agreement. No Person, directly or indirectly controlled thereby
shall be liable for the failure of any other Person, directly or indirectly, controlled thereby to
comply with this Article II.

ARTICLE III

MISCELLANEOUS

     Section 3.1 Choice of Law; Submission to Jurisdiction. This Agreement shall be subject to and governed by the laws of the State of New York. THE
PARTIES AGREE THAT ANY ACTION BROUGHT IN CONNECTION WITH THIS AGREEMENT MAY BE MAINTAINED IN ANY
COURT OF COMPETENT JURISDICTION LOCATED IN THE STATE OF KANSAS, AND EACH PARTY AGREES TO SUBMIT
PERSONALLY TO THE JURISDICTION OF ANY SUCH COURT AND HEREBY WAIVES THE DEFENSES OF FORUM
NON-CONVENIENS OR IMPROPER VENUE WITH RESPECT TO ANY ACTION BROUGHT IN ANY SUCH COURT IN CONNECTION
WITH THIS AGREEMENT.

     Section 3.2 Notice. All notices or other communications required or permitted under, or otherwise in connection
with, this Agreement must be in writing and must be given by depositing same in the U.S. mail,
addressed to the Person to be notified, postpaid and registered or certified with return receipt
requested or by transmitting by national overnight courier or by delivering such notice in person
or by facsimile to such Party. Notice given by mail, national overnight courier or personal
delivery shall be effective upon actual receipt. Notice given by facsimile shall be effective upon

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confirmation of receipt when transmitted by facsimile if transmitted during the recipient’s normal
business hours or at the beginning of the recipient’s next business day after receipt if not
transmitted during the recipient’s normal business hours. All notices to be sent to a Party
pursuant to this Agreement shall be sent to or made at the address set forth below or at such other
address as such Party may stipulate to all other Parties in the manner provided in this Section
3.2.

          if to the CVR Entities:

CVR Energy, Inc.

10 E. Cambridge Circle, Ste. 250

Kansas City, Kansas 66103

Attention: Edmund S. Gross

Facsimile No.: 913-981-0000

          if to the Partnership Entities

CVR GP, LLC

10 E. Cambridge Circle, Ste. 250

Kansas City, Kansas 66103

Attention: Edmund S. Gross

Facsimile No.: 913-981-0000

     Section 3.3 Entire Agreement. This Agreement constitutes the entire agreement of the Parties relating to the matters contained
herein, superseding all prior contracts or agreements, whether oral or written, relating to the
matters contained herein.

     Section 3.4 Amendment or Modification. This Agreement may be amended or modified from time to time only by the written agreement of all
the Parties hereto. Each such instrument shall be reduced to writing and shall be designated on
its face an “Amendment” or an “Addendum” to this Agreement.

     Section 3.5 Assignment. No Party shall have the right to assign any of its rights or obligations under this Agreement
without the consent of the other Parties hereto.

     Section 3.6 Counterparts. This Agreement may be executed in any number of counterparts with the same effect as if all
signatory parties had signed the same document. All counterparts shall be construed together and
shall constitute one and the same instrument.

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     Section 3.7 Severability. If any provision of this Agreement shall be held invalid or unenforceable by a court or
regulatory body of competent jurisdiction, the remainder of this Agreement shall remain in full
force and effect.

     Section 3.8 Further Assurances. In connection with this Agreement and all transactions contemplated by this Agreement, each
signatory party hereto agrees to execute and deliver such additional documents and instruments and
to perform such additional acts as may be necessary or appropriate to effectuate, carry out and
perform all of the terms, provisions and conditions of this Agreement and all such transactions.

     Section 3.9 Rights of Limited Partners; Third Party Beneficiaries. The provisions of this Agreement are enforceable solely by the Parties to this Agreement, and no
Limited Partner of the Partnership shall have the right, separate and apart from the Partnership,
to cause the Partnership to enforce any provision of this Agreement or to compel any Party to this
Agreement to comply with the terms of this Agreement. Goldman, Sachs & Co., Kelso & Company, L.P.
and their respective Affiliates and successors and assigns as owners of interests in the CVR
Entities or Partnership Entities shall be entitled to assert rights and remedies hereunder as a
third-party beneficiary hereto with respect to Section 3.10.

     Section 3.10 No Restrictions on Owners of Managing General Partner or CVR. Notwithstanding anything herein to the contrary, nothing herein shall be deemed to restrict
Goldman, Sachs & Co., Kelso & Company, L.P. or their respective Affiliates (other than the CVR
Entities and the Partnership Entities), or their respective successors and assigns as owners of
interests in the CVR Entities or Partnership Entities, from engaging in any banking, brokerage,
trading, market making, hedging, arbitrage, investment advisory, financial advisory, anti-raid
advisory, merger advisory, financing, lending, underwriting, asset management, principal investing,
mergers & acquisitions or other activities conducted in the ordinary course of their or their
Affiliates’ business in compliance with applicable law, including without limitation buying and
selling securities of any CVR Entity or Partnership Entity, entering into derivatives transactions
regarding or shorting securities of any CVR Entity or Partnership Entity, serving as a lender,
underwriter or market maker or issuing research with respect to securities of any CVR Entity or
Partnership Entity or acquiring, selling, making investments in or entering into other transactions
with companies or businesses in the same or similar lines of business as any CVR Entity or
Partnership Entity whether or not such investments or transactions are or may be competitive with
any business of any CVR Entity or Partnership Entity.

[SIGNATURE PAGE FOLLOWS]

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     IN WITNESS WHEREOF, the Parties have executed this Agreement on, and effective as of, the
Closing Date.

	 	 	 	 	 
	 	CVR ENERGY, INC.

 	 
	 	By:  	/s/
James T. Rens	 
	 	 	Name:  	James T. Rens	 
	 	 	Title:  	Chief Financial Officer and Treasurer	 
	 
	 	CVR GP, LLC

 	 
	 	By:  	/s/
Kevan
A. Vick	 
	 	 	Name:  	Kevan A. Vick	 
	 	 	Title:  	Executive Vice President and
Fertilizer
General Manager	 
	 
	 	CVR PARTNERS, LP

By: CVR GP, LLC, its Managing General Partner

 	 
	 	By:  	/s/
Kevan A. Vick	 
	 	 	Name: 	Kevan A. Vick
	 	 	Title:  	Executive Vice President and
Fertilizer General Manager	
	 
	 	CVR SPECIAL GP, LLC

By: Coffeyville Resources, LLC,
	 
	 	 	
its sole member

 	 
	 	By:  	/s/
James T. Rens	 
	 	 	Name:  	James T. Rens	
	 	 	Title:  	Chief Financial Officer and Treasurer	
	 

Signature Page to Omnibus AgreementEX-10.12

 

Exhibit
10.12

COFFEYVILLE RESOURCES, LLC

PHANTOM UNIT APPRECIATION PLAN (PLAN II)

	1.	 	Purpose; Operation. The purpose of the Coffeyville Resources, LLC Phantom Unit
Appreciation Plan (Plan II) (the “Plan”) is to provide an incentive to employees of the
Company and its Affiliates who contribute to the Company’s success to increase their efforts
on behalf of the Company and to promote the success of the Company’s business. Participants in
the Plan have the opportunity to receive cash payments in respect of Phantom Points they hold
in the event of certain distributions pursuant to the Parent II LLC Agreement to “Members” (as
defined in the Parent II LLC Agreement) in Coffeyville Acquisition II LLC, an indirect equity
owner of the Company. Whether payments will be made will depend on the amount of net proceeds
realized in connection with the event that gives rise to such distributions. Defined terms are
defined in Exhibit A hereto.

	2.	 	Administration. The Plan shall be administered by the Committee. The Committee shall
have the authority in its discretion, subject to and not inconsistent with the express
provisions of the Plan, to administer the Plan and to exercise all the powers and authorities
either specifically granted to it under the Plan or necessary or advisable in the
administration of the Plan, including, without limitation:

	 	•	 	the authority to grant Phantom Points;
	 
	 	•	 	to determine the persons to whom and the time or times at which Phantom
Points shall be granted;
	 
	 	•	 	to determine the number and type of Phantom Points to be granted and the
terms, conditions and restrictions relating thereto;
	 
	 	•	 	to determine whether, to what extent, and under what circumstances Phantom
Points may be settled, cancelled, forfeited, exchanged, or surrendered;
	 
	 	•	 	to make adjustments in the terms and conditions applicable to Phantom
Points;
	 
	 	•	 	to construe and interpret the Plan and Award Agreements;
	 
	 	•	 	to prescribe, amend and rescind rules and regulations relating to the Plan;
	 
	 	•	 	to determine the terms and provisions of the Award Agreements;
	 
	 	•	 	to determine the Baseline Primary Phantom Percentage, the Total Phantom
Percentages and the Final Phantom Percentages;
	 
	 	•	 	to determine the amounts allocable for payment pursuant to this Plan;
	 
	 	•	 	to assign Phantom Benchmark Amounts; and

 

 

	 	•	 	to make all other determinations deemed necessary or advisable for the
administration of the Plan.

	 	 	All determinations made by the Committee in respect of the Plan shall be final and binding
on all Participants and their beneficiaries. No manager or member of the Company or member
of the Committee shall be liable for any action taken or determination made in good faith
with respect to the Plan or any Phantom Points granted hereunder. The Committee, with the
consent of Parent II LLC, shall make determinations with respect to percentages (including
the Total Phantom Percentages and the Final Phantom Percentages) and cash amounts allocated,
if any, to the Plan with reference to the applicable definitions set forth in Exhibit
A; provided that any and all determinations with respect to applicable
percentages and cash amounts allocated to the Plan shall be made in the Committee’s
discretion and may vary from such definitions. The Committee may make adjustments in the
operation of provisions of the Plan if the Committee determines in its sole discretion that
such adjustments will further the intent of such provisions.

	3.	 	Eligibility. Phantom Points may be granted at any time to directors, employees
(including officers) and service providers of an Employer, in the discretion of the Committee.

	4.	 	Phantom Service Points; Payment.

	 	(a)	 	Phantom Service Point Pool. A pool of points shall exist consisting of
“Phantom Service Points”. Phantom Service Points shall represent the right to receive
a cash payment from the Employer within thirty (30) days following the date on which a
distribution is made pursuant to the Parent II LLC Agreement. The pool of Phantom
Service Points shall initially be 10,000,000 but may be increased in the discretion of
the Committee at any time. The total number of Phantom Service Points outstanding
(after taking into account any adjustments made pursuant to Section 7) shall be
referred to as the “Total Phantom Service Point Pool”.
	 
	 	(b)	 	Phantom Service Percentage. The “Phantom Plan Service Percentage” for
each Participant shall be the Final Phantom Service Percentage multiplied by the
quotient obtained by dividing (x) the number of Phantom Service Points allocated to
such Participant by (y) 10,000,000, or, if the Total Phantom Service Point Pool is
greater than 10,000,000, the Total Phantom Service Point Pool.
	 
	 	(c)	 	Phantom Service Point Payments. The cash amount payable to a
Participant in respect of his or her Phantom Service Points at any time that a
distribution is made pursuant to the Parent II LLC Agreement in respect of Operating
Units shall be determined by multiplying (x) such Participant’s Phantom Plan Service
Percentage and (y) the amount of Exit Proceeds. For the avoidance of doubt, the
foregoing is simply a calculation of amount of the cash payment payable to a
Participant holding Phantom Service Points, and in no event shall such

2

 

	 	 	 	Participant, in its capacity as such, have any rights to receive a payment or
distribution from Parent II LLC.1

	5.	 	Phantom Performance Points; Payment.

	 	(a)	 	Phantom Performance Point Pool. A pool of points shall exist
consisting of “Phantom Performance Points”. Phantom Performance Points shall represent
the right to receive a cash payment within thirty (30) days following the date on which
a distribution is made pursuant to the Parent II LLC Agreement in respect of Value
Units. The pool of Phantom Performance Points shall initially be 10,000,000, but may
be increased in the discretion of the Committee at any time. The total number of
Phantom Performance Points outstanding (after taking into account any adjustment made
pursuant to Section 7) shall be referred to as the “Total Phantom Performance Point
Pool”.
	 
	 	(b)	 	Phantom Performance Percentage. The “Phantom Plan Performance
Percentage” for each Participant shall initially be the Final Phantom Performance
Percentage multiplied by the quotient obtained by dividing (x) the number of Phantom
Performance Points allocated to such Participant by (y) 10,000,000, or, if the Total
Phantom Performance Point Pool is greater than 10,000,000, the Total Phantom
Performance Point Pool, and shall be further subject to reduction pursuant to Section
5(c) below.
	 
	 	(c)	 	Performance Factor; Investment Multiple. As provided in the definition
of Final Phantom Performance Percentage, each Participant’s Phantom Plan Performance
Percentage reflects the Performance Factor, which operates to adjust Participants’
performance percentages based on the performance of the investment in the Parent II LLC
by the Investor Members. For purposes of this Plan:

	 	(1)	 	The “Performance Factor” equals a number
(between zero and one) equal to the quotient obtained by dividing (i)
the excess, if positive, of the Final Investment Multiple (as defined
below) over the Minimum Investment Multiple by (ii) two (2);
provided that if such quotient is greater than one, the
Performance Factor will equal one.
	 
	 	(2)	 	The Final Investment Multiple is computed,
after giving effect to any payments to be made pursuant to this Plan,
by dividing (x) the total fair market value of all net distributions
received, or to be received upon the applicable distribution, by the
Investor Members from the Company in respect of their aggregate
investment in the Company divided by (y) the aggregate of such
investment of the Investor Members in the Company (it being understood
that all

 

			
	1	 	Schedule A provides an illustration of how a
calculation of a Phantom Service Point payment would be made under the Plan.
It is not intended to be an indication of actual payments under the Plan.

3

 

	 	 	 	such amounts are themselves simultaneously being calculated by
reference to amounts that may be payable pursuant to the Plan).

	 	(d)	 	Phantom Performance Point Payments. The cash amount payable to a
Participant in respect of his or her Phantom Performance Points at any time that a
distribution is made pursuant to the Parent II LLC Agreement in respect of Value Units
shall be determined by adding (x) the product of (i) such Participant’s Phantom Plan
Performance Percentage and (ii) the amount of Exit Proceeds plus (y) an additional
amount to provide a ‘catch-up’ similar to that provided in respect of Value Units
pursuant to Section 9.1(d) of the Parent II LLC Agreement. For the avoidance of
doubt, the foregoing is simply a calculation of the amount of the cash payment payable
to a Participant holding Phantom Performance Points, and in no event shall such
Participant, in its capacity as such, have any rights to receive a payment or
distribution from Parent II LLC.2

	6.	 	Additional Awards; Adjustments.

	 	(a)	 	Additional Awards. An Employer may determine that a Participant’s
performance warrants an award of additional Phantom Points, in which case the Employer
may recommend to the Committee that an additional award be made.
	 
	 	(b)	 	Prior Appreciation Adjustments. Each Participant will be assigned a
“Phantom Benchmark Amount”, which shall be an amount determined by the Committee with
respect to the Participant each time the Committee awards any Phantom Points to the
Participant and relates to the valuation of Parent II LLC at such time.
Notwithstanding anything to the contrary set forth in the Plan, for purposes of the
calculations under Section 4(c) and Section 5(d), the Committee shall make such
adjustments to the amounts otherwise determined thereunder to account for the Phantom
Benchmark Amount assigned in respect of a Participant’s Phantom Points.
	 
	 	(c)	 	In the event of any material acquisition, disposition, merger,
recapitalization, capital contribution or other similar event, the Committee may make
such adjustment(s) to the terms of the Plan or any awards granted under the Plan as the
Committee shall determine appropriate in its sole discretion.

	7.	 	Termination of Employment. If a Participant ceases to be employed by an Employer
(other than in connection with a transfer to another Employer) prior to an Exit Event, such
Participant shall forfeit all Phantom Points granted to the Participant.

	8.	 	General Provisions.

	 	(a)	 	Nontransferability. Unless otherwise provided in an Award Agreement,
Phantom Points shall not be transferable by a Participant under any circumstances,
except by will or the laws of descent and distribution.

 

			
	2	 	Schedule A provides an illustration of how a
calculation of a Phantom Performance Point payment would be made under the
Plan. It is not intended to be an indication of actual payments under the
Plan.

4

 

	 	(b)	 	No Right to Continued Employment, etc. Nothing in the Plan or in any
Award Agreement entered into pursuant the Plan shall confer upon any Participant the
right to continue in the employ of or to be entitled to any remuneration or benefits
not set forth in the Plan or such Award Agreement, or to interfere with or limit in any
way the right of an Employer to terminate such Participant’s employment.
	 
	 	(c)	 	Taxes. The Company or any Affiliate is authorized to withhold from any
payment relating to Phantom Points under the Plan amounts of withholding and other
taxes due to enable the Company and Participants to satisfy obligations for the payment
of withholding taxes and other tax obligations.
	 
	 	(d)	 	Excise Tax. To the extent that, (i) in the Committee’s determination,
payment to a Participant in respect of his or her Phantom Points would constitute
“parachute payments” (within the meaning of Section 280G of the Code), and if (ii) such
payment would (together with any other payment to which the Participant is or may be
entitled that would constitute a “parachute payment”), if reduced by all federal,
state, and local taxes applicable thereto, including the excise tax imposed under
Section 4999 of the Code, be less than the amount the Participant would receive, after
all taxes, if the Participant received aggregate payments in respect of his or her
Phantom Points (and such other payments) equal (as valued under Section 280G of the
Code) to only three times the Participant’s “base amount” (within the meaning of
Section 280G of the Code), less $1.00, then (iii) such payments hereunder shall be
reduced to such extent to avoid the application of such excise tax; provided that the
Company shall use its reasonable best efforts to obtain shareholder approval of the
payments 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 payments may be made to the Participant in respect of his or her Phantom Points
without the application of the excise tax.
	 
	 	(e)	 	Amendment and Termination. The Plan shall take effect on the date of
its adoption by the Board of Directors of the Company (the “Board”). The Board may at
any time and from time to time alter, amend, suspend, or terminate the Plan in whole or
in part, including but not limited to, amending the Plan and awards to alter the
structure of the Plan if the Board determines that the Plan is not meeting its
objectives.
	 
	 	(f)	 	No Rights to Awards; No Stockholder or Member Rights. No Participant
shall have any claim to be granted any Phantom Points under the Plan, and there is no
obligation for uniformity of treatment of Participants. A Participant or a transferee
of Phantom Points shall have no rights as a stockholder or member of the Company or any
Affiliate.
	 
	 	(g)	 	Unfunded Status of Awards. The Plan is intended to constitute an
“unfunded” plan for incentive compensation. With respect to any payments not yet made
to a Participant pursuant to an Award, nothing contained in the Plan or any Phantom
Points shall give any such Participant any rights that are greater than those of a
general creditor of the Company.

5

 

	 	(h)	 	Governing Law. The Plan and all determinations made and actions taken
pursuant hereto shall be governed by the laws of the State of Delaware without giving
effect to the conflict of laws principles thereof.
	 
	 	(i)	 	Beneficiary. Upon the death of a Participant, all of his of her rights
under the Plan shall inure to his or her designated beneficiary or, if no beneficiary
has been designated, to his or her estate.
	 
	 	(j)	 	No Guarantee or Assurances. There can be no guarantee that any
distributions in respect of Operating Units or Value Units will occur under the Parent
II LLC Agreement or that any payment to any Participant will result under the Plan.
	 
	 	(k)	 	Expiration of Plan. Unless otherwise determined by the Board, the Plan
shall expire on July 25, 2015 and all outstanding Phantom Points shall then expire and
be forfeited with no consideration paid in respect of such forfeiture.

6

 

EXHIBIT A

Plan Definitions

For purposes of the Plan, the following terms shall be defined as set forth below.

“Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of
the Securities Exchange Act of 1934.

“Award Agreement” means any written agreement, contract, or other instrument or document
evidencing a grant of Phantom Points.

“Baseline Primary Phantom Percentage” means a notional profits interest percentage in Parent
II LLC, determined by the Committee with the consent of Parent II LLC in its sole
discretion, attributable to all Phantom Points available for award under the Plan;
provided that in no event shall the Baseline Primary Phantom Percentage plus the
percentage interest represented by all profits interests in the Parent II LLC be greater
than 15% of the combined notional and aggregate equity interests of the Parent II LLC,
assuming all profits interests are outstanding and entitled to share in distributions. Such
deemed profits interest percentage, as adjusted pursuant to the terms of the Plan, is
generally intended to provide, as a function of Exit Proceeds, the maximum attainable cash
payment payable to holders of Phantom Points under the Plan. The Committee shall have the
discretion (with the consent of Parent II LLC) to change the Baseline Primary Phantom
Percentage at any time and from time to time (including upon the occurrence of any
distribution pursuant to the Parent II LLC Agreement or an Exit Event). Schedule 1,
as amended from time to time, shall set forth the Baseline Primary Phantom Percentage.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Committee” means the Compensation Committee of Parent II LLC, or if there is no such
Compensation Committee of Parent II LLC, Parent II LLC.

“Company” means Coffeyville Resources, LLC, a Delaware limited liability company, or any
successor corporation.

“Employer” means the Company or any Affiliate of the Company.

“Exit Event” has the meaning given in the Parent II LLC Agreement.

“Exit Proceeds” means the net proceeds available for distribution to the Members of Parent
II LLC at any time that a distribution is made pursuant to the Parent II LLC Agreement in
respect of Operating Units or Value Units, as the case may be, following the return of all
unreturned “Capital Contributions” (as defined in the Parent II LLC Agreement).

“Final Phantom Percentages” means, collectively, the Final Phantom Performance Percentage,
the Final Phantom Service Percentage and the Final Aggregate Phantom Percentage.

7

 

“Final Phantom Performance Percentage” means the product of (x) the Performance
Factor and (y) the Total Performance Phantom Percentage.

“Final Phantom Service Percentage” means the Total Phantom Service Percentage.

“Investor Member” has the meaning given in the Parent II LLC Agreement.

“Maximum Investment Multiple” means four (4).

“Minimum Investment Multiple” means two (2).

“Operating Unit” has the meaning given in the Parent II LLC Agreement.

“Parent II LLC” means Coffeyville Acquisition II LLC.

“Parent II LLC Agreement” means the Limited Liability Company Agreement of Parent II LLC,
dated as of October 16, 2007, as such may be amended.

“Participant” means an individual who has been granted Phantom Performance Points and/or
Phantom Service Points pursuant to the Plan and who continues to hold Phantom Points.

“Performance Factor” shall have the meaning set forth in Section 5(c)(1).

“Phantom Performance Points” shall have the meaning set forth in Section 5.

“Phantom Points” means, collectively, or individually as the context requires, Phantom
Performance Points and Phantom Service Points.

“Phantom Service Points” shall have the meaning set forth in Section 4.

“Plan” means this Coffeyville Resources, LLC Phantom Unit Appreciation Plan (Plan II), as
amended from time to time.

“Total Performance Phantom Percentage” means the product of (x) .667 and (y) the Baseline
Primary Phantom Percentage.

“Total Phantom Percentages” means, collectively, the Total Performance Phantom Percentage
and the Total Service Phantom Percentage.

“Total Phantom Service Percentage” means the product of (x) .333 and (y) the Baseline
Primary Phantom Percentage.

“Value Unit” has the meaning given in the Parent II LLC Agreement.

8

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