PBF Energy 2012 Annual Report Download - page 104

PBF ENERGY INC. AND SUBSIDIARIES
(COMBINED AND CONSOLIDATED WITH PBF ENERGY COMPANY LLC AND SUBSIDIARIES)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT AND BARREL DATA)
1- ORGANIZATION AND BASIS OF PRESENTATION (Continued)
Noncontrolling Interest (Continued)
(1) Includes the net impact to equity of the issuance of PBF Energy Class A common stock in the IPO, net
of issuance costs and underwriters’ discount and adjustments for the recognition of deferred tax assets
and liabilities and the tax receivable agreement obligation in connection with the IPO.
Comprehensive income includes net income and other comprehensive income arising from activity related to the
Company’s defined benefit employee benefit plan and unrealized gain on available for sale securities. The
following table summarizes the allocation of total comprehensive income between the controlling and
noncontrolling interests for the year ended December 31, 2012:
Attributable to
PBF Energy Inc.
Noncontrolling
Interest Total
Net income ........................... $1,956 $802,081 $804,037
Other comprehensive income (loss):
Unrealized gain on available for sale
securities ....................... — 2 2
Amortization of defined benefit plans
unrecognized net gain (loss) ........ (61) (6,506) (6,567)
Total other comprehensive loss ........... (61) (6,504) (6,565)
Total comprehensive income ............. $1,895 $795,577 $797,472
The following summarizes the noncontrolling interest share of PBF LLC’s net income for the period from
December 18, 2012, the effective date of the IPO, to December 31, 2012:
Income before income taxes ........................... $13,236
Net income attributable to the noncontrolling interest
(75.6%) ......................................... $10,005
Tax Receivable Agreement
PBF LLC intends to make an election under Section 754 of the Internal Revenue Code (the “Code”) effective for
each taxable year in which an exchange of PBF LLC Series A Units for PBF Energy Class A common stock as
described above occurs, which may result in an adjustment to the tax basis of the assets of PBF LLC at the time
of an exchange of PBF LLC Series A Units. As a result of both the initial purchase of PBF LLC Series A Units
from the PBF LLC Series A Unit holders in connection with the IPO and subsequent exchanges, PBF Energy will
become entitled to a proportionate share of the existing tax basis of the assets of PBF LLC. In addition, the
purchase of PBF LLC Series A Units and subsequent exchanges are expected to result in increases in the tax
basis of the assets of PBF LLC that otherwise would not have been available. Both this proportionate share and
these increases in tax basis may reduce the amount of tax that PBF Energy would otherwise be required to pay in
the future. These increases in tax basis may also decrease gains (or increase losses) on future dispositions of
certain capital assets to the extent tax basis is allocated to those capital assets.
PBF Energy entered into a tax receivable agreement with the PBF LLC Series A Unit holders (the “Tax
Receivable Agreement”) that provides for the payment by PBF Energy to the PBF LLC Series A Unit holders of
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