ALON USA ENERGY, INC. (NYSE:ALJ) Files An 8-K Entry into a Material Definitive Agreement

On January 2, 2017, Alon USA Energy, Inc., a Delaware corporation (
Alon), Delek US Holdings, Inc., a Delaware corporation (Delek),
Delek Holdco, Inc., a Delaware corporation and a wholly owned
subsidiary of Delek (HoldCo), Dione Mergeco, Inc., a Delaware
corporation and a wholly owned subsidiary of HoldCo (Parent Merger
Sub) and Astro Mergeco, Inc., a Delaware corporation and wholly
owned subsidiary of HoldCo (Astro Merger Sub and, together with
Holdco and Parent Merger Sub, the Holdco Parties) entered into an
Agreement and Plan of Merger (the Merger Agreement) to which (i)
Parent Merger Sub will, upon the terms and subject to the
conditions thereof, merge with and into Delek (the Parent Merger),
with Delek surviving as a wholly owned subsidiary of Holdco and
(ii) Astro Merger Sub will, upon the terms and subject to the
conditions thereof, merge with and into Alon (the Astro Merger and,
together with the Parent Merger, the Mergers) with Alon surviving.

In the Parent Merger, each issued and outstanding share of common
stock of Delek, par value $0.01 per share (Delek Common Stock), or
fraction thereof, will be converted into the right to receive one
validly issued, fully paid and non-assessable share of Holdco
common stock, par value $0.01 per share (New Common Stock) or such
fraction thereof equal to the fractional share of Delek Common
Stock, upon the terms and subject to the conditions set forth in
the Merger Agreement.

In the Astro Merger, each issued and outstanding share of common
stock of Alon, par value $0.01 per share (Alon Common Stock), other
than Alon Common Stock held by Delek or any subsidiary of Delek,
will be converted into the right to receive 0.504 validly issued,
fully paid and non-assessable shares of New Common Stock, upon the
terms and subject to the conditions set forth in the Merger
Agreement (the New Stock Issuance).

At the Astro Effective Time (as defined in the Merger Agreement),
each restricted share of Alon Common Stock outstanding immediately
prior to the Astro Effective Time will (i) be assumed by Holdco and
converted into a restricted stock award denominated in shares of
New Common Stock and (ii) be subject to substantially the same
terms and conditions as applicable to such stock immediately before
the Astro Effective Time.

The completion of the Mergers is subject to satisfaction or waiver
of certain customary closing conditions, including, among others,
(1) the approval of the Merger Agreement by Alons stockholders, (2)
the approval of the issuance of New Common Stock in connection with
the Mergers by Deleks stockholders, (3) the expiration or
termination of any waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, (4) the receipt of
all government approvals required to be obtained in connection with
the execution and delivery of the Merger Agreement and the
consummation of the transactions contemplated thereby (the Merger
Transactions), (5) the listing of the New Common Stock on the New
York Stock Exchange, (6) the effectiveness of the registration
statement on Form S-4 registering the shares of Holdco Common Stock
issuable in the Merger Transactions, (7) there being no order,
decree or injunction prohibiting the consummation of the Merger
Transactions, (8) subject to specified materiality standards, the
accuracy of the representations and warranties of the other party,
(9) performance and compliance by the other party in all material
respects with its covenants, and (10) other customary conditions
including receipt of a tax opinion from each partys counsel, dated
as of the closing date, to the effect that, (i) in the case of the
Astro Merger, such merger will qualify for U.S. federal income tax
purposes as an exchange within the meaning of Section 351 of the
Internal Revenue Code of 1986, as amended. (the Code) and (ii) in
the case of the Parent Merger, such merger will qualify for U.S.
federal income tax purposes as a reorganization within the meaning
of Section 368(a) of the Code.

The Merger Agreement contains customary representations and
warranties from both Alon and the Holdco Parties, and each party
has agreed to customary covenants, including, among others,
covenants relating to (1) the conduct of its business during the
interim period between the execution of the Merger Agreement and
the effective time of the Mergers, (2) the obligation to use
reasonable best efforts to cause the Mergers to be consummated and
to obtain all permits, consents, approvals and authorizations of
all Governmental Authorities and third parties necessary to
consummate the Merger Transactions, (3) the obligation of Alon to
call a meeting of its stockholders to approve the Merger Agreement
and, subject to certain exceptions, to recommend that its
stockholders approve the Merger Agreement and the Merger
Transactions and (4) the obligation of Delek to call a meeting of
its stockholders to approve the New Stock Issuance and, subject to
certain exceptions, to recommend that its stockholders approve the
New Stock Issuance. The Merger Agreement also prohibits Alon and
Delek from soliciting alternative acquisition proposals, subject to
certain exceptions.

to the Merger Agreement, Delek must take all action necessary to
elect as directors of HoldCo the directors of Delek immediately
prior to the Parent Effective Time (as defined in the Merger
Agreement); provided, however, within thirty days after the closing
date, Delek and HoldCo must take all action necessary to increase
the size of the board of directors of HoldCo by one seat and to
appoint an individual to such newly created position as designated
by the Independent Director Committee (as defined in the Merger
Agreement). to the Merger Agreement, Delek and HoldCo must also,
within thirty days of the closing date, take all action necessary
to cause the board of directors of the general partner of Delek
Logistics

Partners, L.P. to be increased by one seat, and to appoint an
individual to such newly created position as designated by the
Independent Director Committee.

The Merger Agreement permits Alon to continue paying a regular
dividend of up to $0.15 per share of Alon Common Stock and permits
Delek to continue paying a regular quarterly dividend.

The Merger Agreement contains certain termination rights that may
be exercised by either Delek or Alon, including in the event that
(i) both parties agree by mutual written consent to terminate the
Merger Agreement, (ii) the Mergers are not consummated by October
2, 2017, (iii) the approval required from either Deleks or Alons
stockholders is not obtained or (iv) any law or order permanently
restraining, enjoining or otherwise prohibiting consummation of the
Mergers having become final and non-appealable. Additionally, if
Alon has not obtained certain consents specified in the Merger
Agreement prior to 5:00 p.m. on April 2, 2017, Delek may terminate
the agreement by providing Alon with written notice of termination
on or before April 7, 2017. Upon termination of the Merger
Agreement, under certain circumstances, Alon may be required to pay
Delek a termination fee equal to $15,000,000, or Delek may be
required to pay Alon a termination fee equal to $20,000,000. In the
event either party pays a termination fee, it will have no further
liability to the other party with respect to the Merger Agreement,
provided, however, that each party remains liable to the other for
any additional damages if such party commits a willful and material
breach of a covenant, agreement or obligation under the Merger
Agreement.

The summary of the Merger Agreement in this Current Report on Form
8-K does not purport to be complete and is qualified by reference
to the full text of the Merger Agreement, which is filed as Exhibit
2.1 hereto and incorporated by reference herein.

Voting Agreements

Concurrently with the execution of the Merger Agreement, Alon,
Delek and each of David Wiessman, D.B.W. Holdings (2005) Ltd. (an
entity controlled by David Wiessman), Jeff Morris, and Karen Morris
entered into Voting, Irrevocable Proxy and Support Agreements (the
Voting Agreements) in connection with the Merger Agreement. Delek,
David Wiessman, D.B.W. Holdings (2005) Ltd., Jeff Morris and Karen
Morris are each individually referred to herein as an Alon
Stockholder and collectively as the Alon Stockholders.

The Voting Agreements generally require that the Alon Stockholders
vote or cause to be voted all Alon Common Stock owned by the Alon
Stockholders at the Company Stockholders Meeting in favor of (1)
the Mergers and the Merger Agreement and any other transactions or
matters contemplated by the Merger Agreement and (2) any proposal
to adjourn or postpone the Company Stockholders Meeting (as defined
in the Merger Agreement) to a later date if there are not
sufficient votes to adopt the Merger Agreement or if there are not
sufficient shares present in person or by proxy at such meeting to
constitute a quorum. In the case of the Alon Stockholders other
than Delek, the Voting Agreements also require that they vote in
favor of any other matter necessary to consummate the transactions
contemplated by the Merger Agreement, in each case at every meeting
(or in connection with any action by written consent) of the
Company Stockholders at which such matters are considered and at
every adjournment or postponement thereof, and vote against (1) any
Company Acquisition Proposal (as defined in the Merger Agreement),
(2) any action, proposal, transaction or agreement that could
reasonably be expected to result in a breach of any covenant,
representation or warranty or any other obligation or agreement of
Alon under the Merger Agreement or of the Alon Stockholders under
the Voting Agreements and (3) any action, proposal, transaction or
agreement that could reasonably be expected to impede, interfere
with, frustrate, delay, discourage, adversely affect or inhibit the
timely consummation of the Merger or the fulfillment of conditions
under the Merger Agreement or change in any manner the voting
rights of any class of shares of Alon.

Subject to certain exceptions, the Voting Agreements prohibit
certain sales, transfers, offers, exchanges, and dispositions of
Alon Common Stock owned by the Alon Stockholders, the granting of
any proxies or powers of attorney that is inconsistent with the
Voting Agreements, and the depositing of Alon Common Stock owned by
the Alon Stockholders into a voting trust or entering into a voting
agreement or arrangement with respect to the voting of shares of
Alon Common Stock owned by the Alon Stockholders during the term of
the Voting Agreements. The Voting Agreements provide that any Alon
Common Stock the Alon Stockholders acquire after the execution of
the Voting Agreements shall also be subject to the terms of the
Voting Agreements.

The Voting Agreements will terminate upon the earliest to occur of
(a) the consummation of the Merger, (b) a Company Change in
Recommendation or a Parent Change in Recommendation (solely in the
case of Delek) made in accordance with the Merger Agreement and (c)
the termination of the Merger Agreement to and in compliance with
its terms.

The summary of the Voting Agreements in this Current Report on Form
8-K does not purport to be complete and is qualified by reference
to the full text of such agreements, which are filed as Exhibit
10.1, Exhibit 10.2 and Exhibit 10.3 hereto and incorporated by
reference herein.

The Merger Agreement and the Voting Agreements and the above
descriptions have been included to provide investors and security
holders with information regarding the terms of the Merger
Agreement and the Voting Agreements. They are not intended to
provide any other factual information about Alon, Delek or their
respective subsidiaries, affiliates or equity holders. The
representations, warranties and covenants contained in the Merger
Agreement and the Voting Agreements were made only for purposes of
those agreements and as of specific dates; were solely for the
benefit of the respective parties to such agreements; and may be
subject to limitations agreed upon by the parties, including being
qualified by confidential disclosures made by each party to the
other for the purposes of allocating contractual risk between them
that differ from those applicable to investors. Investors should be
aware that the representations, warranties and covenants or any
description thereof may not reflect the actual state of facts or
condition of Alon, Delek or any of their respective subsidiaries,
affiliates, businesses, or equity holders. Moreover, information
concerning the subject matter of the representations, warranties
and covenants may change after the date of the Merger Agreement and
the Voting Agreements, which subsequent information may or may not
be fully reflected in public disclosures by Alon or Delek.
Accordingly, investors should read the representations and
warranties in the Merger Agreement and the Voting Agreements not in
isolation but only in conjunction with the other information about
Alon, Delek and their respective affiliates and subsidiaries that
the respective companies include in reports, statements and other
filings they make with the SEC.

Item 5.01. Changes in Control of Registrant.

The information provided in Item 1.01 of this Current Report on
Form 8-K is incorporated herein by reference.

Item 5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

Appointment of Interim Chief Executive Officer

On December 31, 2016, the Management Employment Agreement, dated
May 11, 2015, between Alon USA GP, LLC and Paul Eisman, Alons Chief
Executive Officer and President, expired in accordance with its
terms and Mr. Eismans service as the Chief Executive Officer and
President of the company ceased.

On January 2, 2017, Alon announced the appointment of Alan Moret as
interim Chief Executive Officer of the company, effective January
1, 2017. Mr. Moret has served as Senior Vice President of Supply of
the Company since August 2008. Mr. Moret served as Alons Senior
Vice President of Asphalt Operations from August 2006 to August
2008, with responsibility for asphalt operations and marketing at
Alons refineries and asphalt terminals. Prior to joining Alon, Mr.
Moret was President of Paramount Petroleum Corporation from
November 2001 to August 2006. Prior to joining Paramount Petroleum
Corporation, Mr. Moret held various positions with Atlantic
Richfield Company, most recently as President of ARCO Crude
Trading, Inc. from 1998 to 2000 and as President of ARCO Seaway
Pipeline Company from 1997 to 1998.

There are no family relationships among Mr. Moret and any of Alons
directors or officers. There have been no transactions nor are
there any proposed transactions between Alon and Mr. Moret that
would require disclosure to Item 404(a) of Regulation S-K.

2016 Fair Market Value Stock Purchase Plan

In May 2015, to the terms of an employment agreement with Paul
Eisman, our former CEO and President, Mr. Eisman was granted an
award of 100,000 restricted shares, at a grant date price of
$18.82. In May 2016, we granted awards totaling 158,333 restricted
shares to Mr. Eisman at a grant date price of $7.55 per share. The
2015 award and 100,000 shares of the 2016 award vested in May 2016
while the remaining 58,333 were scheduled to vest in December 2016.
In the third quarter of 2016, it was determined that awards made in
2015 and 2016 exceeded the individual annual plan limit. As a
result we requested that Mr. Eisman agree to return the net shares
received upon the vesting of 150,000 shares of restricted stock
(50,000 shares from the 2015 grant and 100,000 from the 2016
grant), and that he agree to reduce the outstanding award of 58,333
restricted shares remaining in the 2016 grant to 50,000.

In order to provide Mr. Eisman with the value to which he was
entitled to the terms of his employment agreement, the Board of
Directors, acting through the Compensation Committee, approved of
a cash bonus of approximately $1,392,446. Mr. Eisman then elected
to use these funds to acquire 111,319 shares from Alon at a
purchase price per share equal to the closing price of Alons
common stock on December 28, 2016 to the terms of the 2016 Fair
Market Value Stock Purchase Plan.

Item 7.01. Regulation FD Disclosure.

Furnished as Exhibit 99.1 to this Current Report on Form 8-K and
incorporated into this Item 7.01 by reference is the investor
presentation that will be used in connection with a conference
call to discuss the transactions contemplated by the Merger
Agreement. The investor presentation attached as Exhibit 99.1 and
the information set forth therein shall not be deemed filed for
purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the Exchange Act), or otherwise be subject

to the liabilities of that section, nor shall it be deemed to be
incorporated by reference in any filing under the Securities Act
of 1933, as amended, or the Exchange Act.

Item 8.01. Other Events.

On January 3, 2017, Delek and Alon issued a joint press release
announcing the entry into the Merger Agreement. The press release
is being furnished with this Current Report on Form 8-K as Exhibit
99.2 and is hereby incorporated by reference.

Also on January 3, 2017, Alon distributed a letter to its employees
regarding the entry into the Merger Agreement. A copy of the letter
is being furnished with this Current Report on Form 8-K as Exhibit
99.3 and is hereby incorporated by reference.

Additional Information about the Proposed Transactions

This communication relates to a proposed business combination
between Alon and Delek. This announcement is for informational
purposes only and is neither an offer to purchase, nor a
solicitation of an offer to sell, any securities or the
solicitation of any vote in any jurisdiction to the proposed
transactions or otherwise, nor shall there be any sale, issuance or
transfer or securities in any jurisdiction in contravention of
applicable law. No offer of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.

In connection with the proposed transaction, Delek intends to file
with the SEC a registration statement on Form S-4 that will include
a joint proxy statement of Delek and Alon that also constitutes a
prospectus of Delek. Each of Delek and Alon also plan to file other
relevant documents with the SEC regarding the proposed
transactions. No offering of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
U.S. Securities Act of 1933, as amended. Any definitive joint proxy
statement/prospectus(es) for Delek and/or Alon (if and when
available) will be mailed to shareholders of Delek and/or Alon, as
applicable.

INVESTORS AND SECURITY HOLDERS OF ALON AND DELEK ARE URGED TO READ
THE PROXY STATEMENT(S), REGISTRATION STATEMENT(S), PROXY
STATEMENT/PROSPECTUS AND OTHER DOCUMENTS THAT MAY BE FILED WITH THE
SEC CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION.

Investors and security holders will be able to obtain free copies
of these documents (if and when available) and other documents
containing important information about Alon and Delek, once such
documents are filed with the SEC through the website maintained by
the SEC at http://www.sec.gov. Copies of the documents filed with
the SEC by Alon will be available free of charge on Alons internet
website at http://www.alonusa.com>or by contacting Alons
Investor Relations Department by email at stacymorris@alonusa.com
or by phone at 972-367-3808. Copies of the documents filed with the
SEC by Delek will be available free of charge on Deleks internet
website at http://www.delekus.com>or by contacting Deleks
Investor Relations Department by email at
Investor.Relations@DelekUS.com or by phone at 615-435-1366.

Participants in the Solicitation

Alon and its directors and executive officers, and Delek and its
directors and executive officers, may be deemed to be participants
in the solicitation of proxies from the holders of Alon common
stock and Delek common stock in respect of the proposed
transaction. Information about the directors and executive officers
of Alon is set forth in the proxy statement for Alon’s 2016 Annual
Meeting of Shareholders, which was filed with the SEC on April 1,
2016, and in the other documents filed after the date thereof by
Alon with the SEC. Information about the directors and executive
officers of Delek is set forth in the proxy statement for Deleks
2016 Annual Meeting of Stockholders, which was filed with the SEC
on April 5, 2016, and in the other documents filed after the date
thereof by Alon and Delek with the SEC. Investors may obtain
additional information regarding the interests of such participants
by reading the proxy statement/prospectus regarding the proposed
transaction when it becomes available. You may obtain free copies
of these documents as described in the preceding paragraph.

Cautionary Statement Regarding Forward-Looking Information

This communication contains forward-looking statements that are
based upon current expectations and involve a number of risks and
uncertainties. Statements concerning current estimates,
expectations and projections about future results, performance,
prospects, opportunities, plans, actions and events and other
statements, concerns, or matters that are not historical facts are
forward-looking statements, as that term is defined under the
federal securities laws. These forward-

looking statements include, but are not limited to, statements
regarding the proposed merger with Delek, integration and
transition plans, synergies, opportunities, anticipated future
performance, and other factors.

Investors are cautioned that the following important factors, among
others, may affect these forward-looking statements. These factors
include but are not limited to: risks and uncertainties related to
the expected timing and likelihood of completion of the proposed
merger, including the timing, receipt and terms and conditions of
any required governmental and regulatory approvals of the proposed
merger that could reduce anticipated benefits or cause the parties
to abandon the transaction, the ability to successfully integrate
the businesses, the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement, the possibility that stockholders of Delek may not
approve the issuance of new shares of common stock in the merger or
that stockholders of Alon may not approve the merger agreement, the
risk that the parties may not be able to satisfy the conditions to
the proposed transaction in a timely manner or at all, risks
related to disruption of management time from ongoing business
operations due to the proposed transaction, the risk that any
announcements relating to the proposed transaction could have
adverse effects on the market price of Alon’s common stock or
Delek’s common stock, the risk that the proposed transaction and
its announcement could have an adverse effect on the ability of
Alon and Delek to retain customers and retain and hire key
personnel and maintain relationships with their suppliers and
customers and on their operating results and businesses generally,
the risk that problems may arise in successfully integrating the
businesses of the companies, which may result in the combined
company not operating as effectively and efficiently as expected,
the risk that the combined company may be unable to achieve
cost-cutting synergies or it may take longer than expected to
achieve those synergies, uncertainty related to timing and amount
of future share repurchases and dividend payments, risks and
uncertainties with respect to the quantities and costs of crude oil
we are able to obtain and the price of the refined petroleum
products we ultimately sell; gains and losses from derivative
instruments; management’s ability to execute its strategy of
growth through acquisitions and the transactional risks associated
with acquisitions and dispositions; acquired assets may suffer a
diminishment in fair value as a result of which we may need to
record a write-down or impairment in carrying value of the asset;
changes in the scope, costs, and/or timing of capital and
maintenance projects; operating hazards inherent in transporting,
storing and processing crude oil and intermediate and finished
petroleum products; our competitive position and the effects of
competition; the projected growth of the industries in which we
operate; general economic and business conditions affecting the
southeastern United States; and other risks contained in our
filings with the United States Securities and Exchange Commission.

Forward-looking statements should not be read as a guarantee of
future performance or results and will not be accurate indications
of the times at or by which such performance or results will be
achieved. Forward-looking information is based on information
available at the time and/or management’s good faith belief with
respect to future events, and is subject to risks and uncertainties
that could cause actual performance or results to differ materially
from those expressed in the statements. Alon undertakes no
obligation to update or revise any such forward-looking statements,
except as required by applicable law or regulation.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

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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 hereunto duly authorized.

INDEX TO EXHIBITS

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