Tesoro Corporation (NASDAQ:TSO) Files An 8-K Entry into a Material Definitive Agreement

Tesoro Corporation (NASDAQ:TSO) Files An 8-K Entry into a Material Definitive Agreement

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Item1.01

Entry into a Material Definitive Agreement

Indenture and Notes Issuance

On December22, 2016, Tesoro Corporation (the Company) closed its
previously announced offering of $850,000,000 aggregate principal
amount of 4.750% Senior Notes due 2023 (the 2023 Notes) and
$750,000,000 aggregate principal amount of 5.125% Senior Notes
due 2026 (the 2026 Notes together with the 2023 Notes, the
Notes). The Notes were issued to an indenture, dated as of
December22, 2016 (the Indenture), among the Company, the
guarantors party thereto and U.S. Bank National Association, as
trustee (the Trustee). The Notes were offered and sold in
accordance with the Companys Offering Memorandum dated
December15, 2016 and in the United States only to qualified
institutional buyers (as defined in the Securities Act of 1933,
as amended (the Securities Act)) to Rule 144A under the
Securities Act and outside the United States only to non-U.S.
persons in accordance with Regulation S under the Securities Act.
Following the issuance of the Notes described above and the
Companys entry on December 13, 2016 into its amended revolving
credit facility, the Companys bridge commitment has been
terminated.

The 2023 Notes were issued at an issue price of 100.00% and bear
interest at a rate of 4.750% per annum. The 2026 Notes were
issued at an issue price of 100.00% and bear interest at a rate
of 5.125% per annum. Interest on the Notes is payable on June15
and December15 of each year, beginning on June15, 2017. The 2023
Notes will mature on December15, 2023 and the 2026 Notes will
mature on December15, 2026.

The Company may redeem some or all of the 2023 Notes prior to
October15, 2023 and some or all of the 2026 Notes prior to
September15, 2026 for cash at the redemption prices set forth in
the Indenture, plus accrued and unpaid interest and, if any,
additional interest. If the Company experiences specific kinds of
change of control, it will be required to offer to purchase the
Notes at a price equal to 101% of the principal amount thereof
plus accrued and unpaid interest.

In the event that (i)the merger (the Merger) of Tahoe Merger Sub
1, Inc., a Delaware Corporation, with and into Western Refining,
Inc. does not take place on or prior to November30, 2017 or
(ii)at any time prior to November30, 2017, the Agreement and Plan
of Merger, dated as of November16, 2016 (the Merger Agreement),
by and among the Company, Western Refining, Inc., Tahoe Merger
Sub 1, Inc., a wholly owned subsidiary of the Company, and Tahoe
Merger Sub 2, LLC, a wholly owned subsidiary of the Company, is
terminated, the Company will redeem all of the Notes at a price
equal to 101% of the principal amount thereof plus accrued and
unpaid interest.

The Notes are the Companys general unsecured senior obligations,
and are effectively subordinated to all of the Companys existing
and future secured indebtedness to the extent of the value of the
collateral securing such indebtedness, structurally subordinated
to all existing and future indebtedness and other liabilities of
the Companys non-guarantor subsidiaries, equal in right of
payment to all of the Companys and Companys guarantor
subsidiaries existing and future senior indebtedness and senior
in right of payment to all of the Companys future subordinated
indebtedness, if any. The Notes are jointly and severally
guaranteed on a senior unsecured basis by certain of the Companys
domestic subsidiaries that have outstanding debt or guarantee
other specified indebtedness and, following completion of the
Merger, Western Refining, Inc. and certain of its subsidiaries.

The foregoing description of the Indenture and the Notes does not
purport to be complete and is qualified in its entirety by
reference to the full text of the Indenture and the form of Notes
(included in the Indenture), which is filed as Exhibit 4.1
herewith and incorporated by reference herein.

The Notes have not been registered under the Securities Act. The
Notes may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements of the Securities Act.

Item2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement
of a Registrant.

The information
set forth above under Item 1.01 above is incorporated by
reference into this Item 2.03.

FORWARD
LOOKING STATEMENTS

This communication
contains certain statements that are forward-looking statements
within the meaning of Section 27A of the Securities Act and
Section 21E of the Securities Exchange Act of 1934. Words such as
may, will, could, anticipate, estimate, expect, predict, project,
future, potential, intend, plan, assume, believe, forecast, look,
build, focus, create, work continue or the negative of such terms
or other variations thereof and words and terms of similar
substance used in connection with any discussion of future plans,
actions, or events identify forward-looking statements. These
forward-looking statements include, but are not limited to,
statements regarding the proposed Merger, integration and
transition plans, synergies, opportunities, anticipated future
performance, expected share buyback program and expected
dividends. There are a number of risks and uncertainties that
could cause actual results to differ materially from the
forward-looking statements included in this communication. For
example, 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 the Company may not approve the issuance of new
shares of common stock in the Merger or that stockholders of
Western Refining, Inc. 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 the Companys common stock
or Western Refining, Inc.s common stock, the risk that the
proposed transaction and its announcement could have an adverse
effect on the ability of the Company and Western Refining, Inc.
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, the risk that the combined company may not buy back
shares, the risk of the amount of any future dividend the Company
may pay, and other factors. All such factors are difficult to
predict and are beyond the Companys control, including those
detailed in the Companys annual reports on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K and
registration statement on Form S-4 filed with the SEC on
December14, 2016, as amended (the Form S-4) that are available on
its website at http://www.tsocorp.com and on the SECs website at
http://www.sec.gov, and those detailed in Western Refining, Inc.s
annual reports on Form 10-K, quarterly reports on Form 10-Q and
current reports on Form 8-K that are available on Western
Refining, Inc.s website at http://www.wnr.com and on the SEC
website at http://www.sec.gov. The Companys and Western Refining,
Inc.s forward-looking statements are based on assumptions that
the Company and Western Refining, Inc. believe to be reasonable
but that may not prove to be accurate. The Company and Western
Refining, Inc. undertake no obligation to publicly release the
result of any revisions to any such forward-looking statements
that may be made to reflect events or circumstances that occur,
or which we become aware of, except as required by applicable law
or regulation. Readers are cautioned not to place undue reliance
on these forward-looking statements that speak only as of the
date hereof.

No Offer or
Solicitation:

This communication relates to
a proposed business combination between Western Refining, Inc.
and the Company. 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 Section10 of the Securities Act, as
amended.

Additional Information
and Where to Find It:

This communication may be
deemed to be solicitation material in respect of the proposed
transaction between the Company and Western Refining, Inc. In
connection with the proposed transaction, Tesoro has filed the
Form S-4, containing a preliminary joint proxy
statement/prospectus of Tesoro and Western Refining, Inc. and
Western Refining, Inc. and/or the Company may file one or more
additional proxy statements, registration statements, proxy
statement/prospectus or other documents with the SEC. This
communication is not a substitute for the proxy statement,
registration statement, proxy statement/prospectus or any other
documents that the Company or Western may file with the SEC or
send to stockholders in connection with the proposed transaction.
STOCKHOLDERS OF THE COMPANY AND WESTERN REFINING, INC. ARE URGED
TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE
FORM S-4 AND ANY OTHER PROXY STATEMENT(S), REGISTRATION
STATEMENT(S) AND/OR PROXY STATEMENT/PROSPECTUS(ES), BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION.

The Form S-4 has not yet
become effective. After the Form S-4 is declared effective by the
SEC, the Company and Western Refining, Inc. will each file with
the SEC a definitive joint proxy statement/prospectus, and each
of the Company and Western Refining, Inc. will file other
documents with respect to the proposed transaction. Any
definitive proxy statement(s) (if and when available) will be
mailed to stockholders of Western Refining, Inc. and/or the
Company, as applicable. Investors and security holders will be
able to obtain copies of these documents, including the proxy
statement/prospectus, and other documents filed with the SEC
(when available) free of charge at the SECs website,
http://www.sec.gov. Copies of documents filed with the SEC by the
Company will be made available free of charge on the Companys
website at http://www.tsocorp.com or by contacting the Companys
Investor Relations Department by phone at 210-626-6000. Copies of
documents filed with the SEC by Western Refining, Inc. will be
made available free of charge on Western Refining, Inc.s website
at http://www.wnr.com or by contacting Western Refining, Inc.s
Investor Relations Department by phone at 602-286-1530 or
602-286-1533.

Participants in the
Solicitation:

The Company and its directors
and executive officers, and Western Refining, Inc. and its
directors and executive officers, may be deemed to be
participants in the solicitation of proxies from the holders of
the Companys common stock and Western Refining, Inc.s common
stock in respect of the proposed transaction. Information about
the directors and executive officers of the Company is set forth
in the proxy statement for the Companys 2016 Annual Meeting of
Stockholders, which was filed with the SEC on March22, 2016, and
in the other documents filed after the date thereof by the
Company with the SEC. Information about the directors and
executive officers of Western Refining, Inc. is set forth in the
proxy statement for Western Refining, Inc.s 2016 Annual Meeting
of Shareholders, which was filed with the SEC on April22, 2016,
and in the other documents filed after the date thereof by
Western Refining, Inc. 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.

Section9.01 Financial
Statements and Exhibits.

Exhibit

Number

Description

4.1 Indenture (including form of Notes), dated as of December22,
2016, among Tesoro Corporation, the guarantors named therein
and U.S. Bank National Association, as trustee, relating to
the $850,000,000 aggregate principal amount of 4.750% Senior
Notes due 2023 and $750,000,000 aggregate principal amount of
5.125% Senior Notes due 2026.


About Tesoro Corporation (NASDAQ:TSO)


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