8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): September 25, 2012 (July 12, 2012)

HOLLY ENERGY PARTNERS, L.P.

(Exact name of registrant as specified in its charter)

Delaware	001-32225	20-0833098
(State of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

2828 N. Harwood, Suite 1300, Dallas, Texas 75201

(Address of Principal Executive Offices)

(214) 871-3555

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Explanatory Note

On July 12, 2012, HollyFrontier Corporation (“HollyFrontier”), Holly Energy Partners, L.P. (the “Partnership”), and its subsidiary, HEP UNEV Holdings LLC (“Buyer”), entered into an LLC Interest Purchase Agreement pursuant to which, among other things, Buyer acquired all of the issued and outstanding limited liability company interests of HEP UNEV Pipeline LLC (f/k/a Holly UNEV Pipeline Company) from HollyFrontier, thereby indirectly acquiring 75% of all of the issued and outstanding membership interests in UNEV Pipeline, LLC (“UNEV Pipeline”), the owner of an approximately 400 mile, 12-inch refined products pipeline currently running from Woods Cross, Utah to Las Vegas, Nevada, related products terminals in or near Cedar City, Utah and Las Vegas, Nevada, and other related assets. This amendment on Form 8-K/A is being filed to amend and supplement the Current Report on Form 8-K filed by the Partnership on July 12, 2012 to include the financial statements and pro forma financial information required under Item 9.01.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired.

The unaudited financial statements of UNEV Pipeline relating to the Acquisition as of and for the six months ended June 30, 2012 and June 30, 2011 are filed as Exhibit 99.1 to this amendment and are incorporated herein by reference.

The audited financial statements of UNEV Pipeline relating to the Acquisition as of and for the year ended December 31, 2011 are filed as Exhibit 99.2 to this amendment and are incorporated herein by reference.

(b) Pro Forma Financial Information.

The pro forma combined financial statements of the Partnership with respect to the Acquisition as of and for the six months ended June 30, 2012 and for the year ended December 31, 2011 is filed as Exhibit 99.3 to this amendment and incorporated herein by reference.

(d) Exhibits.

23.1*	Consent of Ernst & Young LLP, independent auditor.
99.1*	Unaudited financial statements of UNEV Pipeline as of and for the six months ended June 30, 2012 and 2011.
99.2*	Audited financial statements of UNEV Pipeline as of and for the year ended December 31, 2011.
99.3*	Unaudited pro forma combined financial statements of the Partnership as of and for the six months ended June 30, 2012 and for the year ended December 31, 2011.

* Filed herewith.

2

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 hereunto duly authorized.

	HOLLY ENERGY PARTNERS, L.P.
	By:	HEP Logistics Holdings, L.P., its General Partner
		By:	Holly Logistic Services, L.L.C., its General Partner
			By:	/s/ Bruce R. Shaw
				Name: Bruce R. Shaw
				Title:   Senior Vice President and   Chief Financial Officer
Date: September 25, 2012

3

EXHIBIT INDEX

Exhibit Number	Exhibit Title
23.1*	Consent of Ernst & Young LLP, independent auditor.
99.1*	Unaudited financial statements of UNEV Pipeline as of and for the six months ended June 30, 2012 and 2011.
99.2*	Audited financial statements of UNEV Pipeline as of and for the year ended December 31, 2011.
99.3*	Unaudited pro forma combined financial statements of the Partnership as of and for the six months ended June 30, 2012 and for the year ended December 31, 2011.

* Filed herewith.

4

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the incorporation by reference in Registration Statements (Form S-3 No. 333-178304) of Holly Energy Partners, L.P. and in the related Prospectus and (Form S-8 No. 333-182865) pertaining to the Holly Energy Partners, L. P. Long-Term Incentive Plan of Holly Energy Partners, L.P, of our report dated September 25, 2012, with respect to the financial statements of UNEV Pipeline, L.L.C. included in this Current Report on Form 8-K/A of Holly Energy Partners, L.P.

/s/ Ernst & Young LLP

Dallas, Texas

September 25, 2012

EX-99.1

Exhibit 99.1

FINANCIAL STATEMENTS

UNEV Pipeline, LLC

Six Months Ended June 30, 2012

UNEV Pipeline, LLC

Financial Statements

Six Months Ended June 30, 2012

Contents

Financial Statements (unaudited)

Balance Sheets	1
Statements of Operations	2
Statement of Changes in Partners’ Capital	3
Statements of Cash Flows	4
Notes to Financial Statements	5

UNEV Pipeline, LLC

Balance Sheets

(In Thousands)

	June 30,  2012 (Unaudited)		December 31, 2011
Cash and cash equivalents	$	—	$	3,100
Restricted cash		1,000		1,000
Receivable from affiliates		4,719		4,080
Other current assets		43		85
Total current assets		5,762		8,265
Properties and equipment, net		403,452		401,287
Total assets	$	409,214	$	409,552
Accounts payable	$	3,032	$	12,268
Payable to affiliates		597		1,274
Deferred Revenue		2,534		—
Total current liabilities		6,163		13,542
Partners’ Capital		403,051		396,010
Total liabilities & partners’ capital	$	409,214	$	409,552

See accompanying notes.

1

UNEV Pipeline, LLC

Statements of Operations

(Unaudited)

(In Thousands)

	Six Months Ended June 30,
	2012			2011
Revenues:
Transportation revenue from affliates	$	7,792		$	—
Other revenue		21			2
		7,813			2
Expenses:
Operating (exclusive of depreciation)		5,648			330
Depreciation		7,124			358
		12,772			688
Net loss	$	(4,959	)	$	(686	)

See accompanying notes.

2

UNEV Pipeline, LLC

Statement of Changes in Partners’ Capital

(Unaudited)

(In Thousands)

	Sinclair			HFC			Total
Balance December 31, 2011	$	99,002		$	297,008		$	396,010
Contributions made		3,000			9,000			12,000
Net loss		(1,240	)		(3,719	)		(4,959	)
Balance June 30, 2012	$	100,762		$	302,289		$	403,051

See accompanying notes.

3

UNEV Pipeline, LLC

Statements of Cash Flows

(Unaudited)

(In Thousands)

	Six Months Ended June 30,
	2012			2011
Cash flows from operating activities:
Net loss	$	(4,959	)	$	(686	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		7,124			358
(Increase) decrease in current assets
Receivable from affiliates		(3,639	)		(57	)
Other current assets		42			—
Increase (decrease) in current liabilities
Accounts payable		(4,177	)		3,528
Payable to affiliates		(677	)		277
Deferred revenue		2,534			—
Other		19			—
Net cash (provided by) operating activities:		(3,733	)		3,420
Cash flows from investing activity:
Acquisitions of property and equipment		(14,367	)		(77,768	)
Cash flows from financing activity:
Cash contributions made		15,000			79,500
Increase (decrease) in cash and cash equivalents		(3,100	)		5,152
Cash and cash and equivalents at beginning of year		3,100			7,649
Cash and cash equivalents at end of year	$	—		$	12,801

See accompanying notes.

4

UNEV Pipeline, LLC

Notes to Financial Statements (Unaudited)

As of and for the six months ended

June 30, 2012

1. Organization and Nature of Business

UNEV Pipeline, LLC (“UNEV”), a Delaware limited liability company, recently completed the UNEV Pipeline, a 400 mile, 12-inch refined products pipeline from Salt Lake City, Utah to Las Vegas, Nevada, together with terminal and ethanol blending facilities in the Cedar City, Utah and North Las Vegas areas and storage facilities at the Cedar City terminal. As of December 31, 2011, a subsidiary of HollyFrontier Corporation (“HFC”) owned 75% of the pipeline with a subsidiary of Sinclair Oil Corporation (“Sinclair”) owning the remaining 25% interest. The cost of constructing this pipeline including terminals and ethanol blending and storage facilities was approximately $410 million. The pipeline was mechanically complete in November 2011, and initial start-up activities commenced in December 2011.

The financial statements included herein have been prepared without audit. The interim financial statements reflect all adjustments, which, in the opinion of management, are necessary for a fair presentation of our results for the interim periods. Such adjustments are considered to be of a normal recurring nature. Although certain notes and other information required by U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted, we believe that the disclosures in these financial statements are adequate to make the information presented not misleading. These financial statements should be read in conjunction with annual financials for the year ended December 31, 2011. Results of operations for interim periods are not necessarily indicative of the results of operations that will be realized for the year ending December 31, 2012.

In this document, the words “we”, “our”, “ours” and “us” refer to UNEV unless the context otherwise indicates.

2. Related Parties

HFC was the largest shipper on the pipeline operating under a ten-year transportation agreement as discussed in Note 4 below. Sinclair is the other shipper on the pipeline operating under a ten-year transportation agreement discussed below. All transactions with HFC and Sinclair have been labeled as affiliate transactions on the balance sheets and statements of operations.

In June 2011, a subsidiary of Holly Energy Partners L.P. (“HEP”) was appointed the operator of UNEV. We paid management fees to HEP totaling $450,000 and $75,000 for the six months ended June 30, 2012 and 2011, respectively, which are included in operating costs.

Employees who provide direct services to us are employed by Holly Logistic Services, L.L.C., a subsidiary of HFC which is the general partner of HEP’s general partner. These employees’ costs, including salaries, bonuses, payroll taxes, benefits, and other direct costs, are charged to us monthly. We paid $991,000 and $100,600 with respect to such costs for the six months ended 2012 and 2011, respectively which are included in operating costs.

5

UNEV Pipeline, LLC

Notes to Financial Statements (continued)

3. Properties and Equipment

	June 30, 2012			December 31, 2011
	(in thousands)			(in thousands)
Pipelines and terminals	$	375,300		$	229,423
Construction in progress		1,669			157,653
Land and right of way		35,110			16,755
Buildings and other		2,035			1,047
		414,114			404,878
Less accumulated depreciation		(10,662	)		(3,591	)
	$	403,452		$	401,287

4. Transportation Agreements

Effective January 1, 2012, we entered into ten-year transportation agreements with HFC and Sinclair, which ten-year term commenced on March 1, 2012, and will result in minimum annualized payments to UNEV of $15.6 million and $7.4 million, respectively.

5. Restricted Cash

The restricted cash consists of $1.0 million held in an escrow account pursuant to an agreement among UNEV, a utility services contractor and the financial institution. The escrow agreement was entered following settlement of certain claims between UNEV and the contractor regarding asset construction work. Funds will be released to UNEV or the contractor upon mutual agreement or pursuant to the determination of a court of competent jurisdiction if UNEV and the contractor are unable to reach an agreement.

6. Subsequent Event

On July 12, 2012, HEP acquired HFC’s 75% interest in UNEV. HEP paid consideration consisting of $260.0 million in cash and 1,029,900 of their common units. Under the terms of the transaction, HEP also issued to HFC equity interests in its wholly owned subsidiary that entitles HFC to an interest in HEP’s share of future UNEV profits beginning in 2015 through 2032, subject to a cap of approximately $34.0 million and certain other limitations.

We have evaluated subsequent events through September 25, 2012.

6

EX-99.2

Exhibit 99.2

FINANCIAL STATEMENTS

UNEV Pipeline, LLC

Year Ended December 31, 2011

UNEV Pipeline, LLC

Financial Statements

Year Ended December 31, 2011

Contents

Report of Independent Auditors	1
Audited Financial Statements
Balance Sheet	2
Statement of Operations	3
Statement of Changes in Partners’ Capital	4
Statement of Cash Flows	5
Notes to Financial Statements	6

Report of Independent Auditors

The Members of UNEV Pipeline, LLC

UNEV Pipeline LLC

We have audited the accompanying balance sheet of UNEV Pipeline, LLC as of December 31, 2011, and the related statements of operations, changes in partners’ capital and statement of cash flows for the year then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of UNEV Pipeline, LLC at December 31, 2011 and the results of its operations and its cash flows for the year then ended in conformity with U.S. generally accepted accounting principles.

Dallas, Texas

September 25, 2012

1

UNEV Pipeline, LLC

Balance Sheet

(In Thousands)

	December 31, 2011
Cash and cash equivalents	$	3,100
Restricted cash		1,000
Receivable from affiliates		4,080
Other current assets		85
Total current assets		8,265
Properties and equipment, net		401,287
Total assets	$	409,552
Accounts payable	$	12,268
Payable to affiliates		1,274
Total current liabilities		13,542
Partners’ capital		396,010
Total liabilities & partners’ capital	$	409,552

See accompanying notes.

2

UNEV Pipeline, LLC

Statement of Operations

(In Thousands)

	Year Ended
	December 31, 2011
Revenues:
Transportation revenue from affliates	$	313
Other revenue		2
		315
Expenses:
Operating (exclusive of depreciation)		1,992
Depreciation		1,758
		3,750
Net loss	$	(3,435	)

See accompanying notes.

3

UNEV Pipeline, LLC

Statement of Changes in Partners’ Capital

(In Thousands)

	Sinclair			HFC			Total
Balance December 31, 2010	$	63,361		$	190,084		$	253,445
Contributions made		36,500			109,500			146,000
Net loss		(859	)		(2,576	)		(3,435	)
Balance December 31, 2011	$	99,002		$	297,008		$	396,010

See accompanying notes.

4

UNEV Pipeline, LLC

Statement of Cash Flows

(In Thousands)

	Year ended
	December 31, 2011
Cash flows from operating activities:
Net loss	$	(3,435	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		1,758
Increase in current assets
Receivable from affiliates		(1,080	)
Restricted cash		(1,000	)
Other current assets		(85	)
Increase in current liabilities
Accounts payable		4,760
Payable to affiliates		728
Net cash provided by operating activities		1,646
Cash flows from investing activity:
Acquisitions of property and equipment		(162,695	)
Cash flows from financing activity:
Cash contributions made		156,500
Decrease in cash and cash equivalents		(4,549	)
Cash and cash equivalents at beginning of year		7,649
Cash and cash equivalents at end of year	$	3,100

See accompanying notes.

5

UNEV Pipeline, LLC

Notes to Financial Statements

December 31, 2011

1. Organization and Nature of Business

UNEV Pipeline, LLC (“UNEV”), a Delaware limited liability company, recently completed the UNEV Pipeline, a 400 mile, 12-inch refined products pipeline from Salt Lake City, Utah to Las Vegas, Nevada, together with terminal and ethanol blending facilities in the Cedar City, Utah and North Las Vegas areas and storage facilities at the Cedar City terminal. As of December 31, 2011, a subsidiary of HollyFrontier Corporation (“HFC”) owned 75% of the pipeline with a subsidiary of Sinclair Oil Corporation (“Sinclair”) owning the remaining 25% interest. The cost of constructing this pipeline including terminals and ethanol blending and storage facilities was approximately $410 million. The pipeline was mechanically complete in November 2011, and initial start-up activities commenced in December 2011. In this document, the words “we”, “our”, “ours” and “us” refer to UNEV unless the context otherwise indicates.

2. Accounting Policies

Uses of Estimates – The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Cash and cash equivalents– For purposes of the statements of cash flows, we consider all highly liquid investments with maturity of three months or less at the time of purchase to be cash equivalents. The carrying amounts reported on the balance sheet approximate fair value due to the short-term maturity of these instruments.

Account Receivable – All receivables are due from HFC or Sinclair. Credit is extended based on evaluation of the customer’s financial condition. Credit losses would be charged to income when accounts are deemed uncollectible.

Long-Lived Assets – Properties and equipment are stated at cost. Maintenance, repairs and major replacements are generally expensed as incurred. Costs of replacements constituting improvements are capitalized. We evaluate long-lived assets, for potential impairment by identifying whether indicators of impairment exist and, if so, assessing whether the long-lived assets are recoverable from estimated future undiscounted cash flows. The actual amount of impairment loss, if any, to be recorded is equal to the amount by which a long-lived asset’s carrying value exceeds its fair value. No impairments of long-lived assets were recorded during the period included in these financial statements.

Depreciation – Depreciation is computed using the straight-line method at annual rates following depreciation over the estimated useful lives of the assets, primarily 25 years for terminal facilities and tankage, 30 years for pipelines, and 5-10 years for corporate and other assets.

Revenue Recognition – Revenues are recognized as products are shipped through our pipelines and terminals or other services have been rendered. Billings to customers for obligations under their quarterly minimum revenue commitments are recorded as deferred revenue liabilities if the customer has the right to receive future services for these billings.

Taxes billed and collected from our pipeline and terminal customers are recorded on a net basis with no effect on net income.

6

UNEV Pipeline, LLC

Notes to Financial Statements (continued)

Income Tax – We are organized as a pass-through for federal income tax purposes. As a result, our partners are responsible for federal income taxes based on their respective share of taxable income. UNEV’s operating jurisdictions are Utah and Nevada both of which conform to the federal pass-through entity tax treatment and do not levy taxes on federal tax partnerships. While UNEV is part of unitary group for Texas Franchise tax purposes which did levy entity level tax with HFC for the calendar year ended December 31, 2011, UNEV has no filing requirement for Texas on a separate entity basis. UNEV’s operating agreement provides that its Board of Directors, if it determines UNEV has net cash, is to distribute 40% of its taxable income to its members for their tax liability created by UNEV.

Regulatory Requirements – These financial statements are prepared in accordance with accounting principles generally accepted in the United States. The information contained in these financial statements may differ in some respects from the information filed with the Federal Energy Regulatory Commission (“FERC”).

3. Related Parties

HFC was the largest shipper on the pipeline operating under a ten-year transportation agreement. Sinclair is the other shipper on the pipeline operating under a ten-year transportation agreement. All transactions with HFC and Sinclair have been labeled as affiliate transactions on the balance sheet and statement of operations.

In June 2011, Holly Energy Partners (“HEP”) was appointed the operator of UNEV. We paid management fees to HEP totaling $525,000 for the year ended December 31, 2011, which are included in operating costs.

Employees who provide direct services to us are employed by Holly Logistic Services, L.L.C., a subsidiary of HFC which is the general partner of HEP’s general partner. These employees’ costs, including salaries, bonuses, payroll taxes, benefits, and other direct costs, are charged to us monthly. We paid $449,000 with respect to such costs for the year ended December 31, 2011, which are included in operating costs.

4. Properties and Equipment

	December 31, 2011
	(in thousands)
Pipelines and terminals	$	229,423
Construction in progress		157,653
Land and right of way		16,755
Buildings and other		1,047
		404,878
Less accumulated depreciation		(3,591	)
	$	401,287

7

UNEV Pipeline, LLC

Notes to Financial Statements (continued)

5. Restricted Cash

The restricted cash consists of $1.0 million held in an escrow account pursuant to an agreement among UNEV, a utility services contractor and the financial institution. The escrow agreement was entered following settlement of certain claims between UNEV and the contractor regarding asset construction work. Funds will be released to UNEV or the contractor upon mutual agreement or pursuant to the determination of a court of competent jurisdiction if UNEV and the contractor are unable to reach an agreement.

6. New Accounting Standards

Presentation of Comprehensive Income

In June 2011, an accounting standard update was issued that requires the presentation of net income and other comprehensive income in one continuous statement or in two separate, but consecutive, statements and eliminates the option to present the components of other comprehensive income in the statement of stockholders’ equity. This standard is effective January 1, 2012 and will be applied retrospectively. This standard will not have an impact on our financial condition, results of operations and cash flows.

7. Subsequent Events

Effective January 1, 2012, we entered into ten-year transportation agreements with HFC and Sinclair, which ten-year term commenced on March 1, 2012, and will result in minimum annualized payments to UNEV of $15.6 million and $7.4 million, respectively.

On July 12, 2012, HEP acquired HFC’s 75% interest in UNEV. HEP paid consideration consisting of $260.0 million in cash and 1,029,900 of their common units. Under the terms of the transaction, HEP also issued to HFC equity interests in its wholly owned subsidiary that entitles HFC to an interest in HEP’s share of future UNEV profits beginning in 2015 through 2032, subject to a cap of approximately $34.0 million and certain other limitations.

We have evaluated subsequent events through September 25, 2012.

8

EX-99.3

Exhibit 99.3

UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION

The Unaudited Pro Forma Condensed Balance Sheet combines the historical balance sheets of Holly Energy Partners L.P. and UNEV Pipeline, LLC giving effect to the acquisition as if it had been consummated on June 30, 2012. The Unaudited Pro Forma Condensed Combined Statement of Income for the six months ended June 30, 2012 and the year ended December 31, 2011 combine the historical statements of income of Holly Energy Partners L.P. and UNEV Pipeline, LLC giving the effect to the acquisition as it has been consummated on January 1, 2011.

These pro forma statements have been made solely for the purpose of providing the Unaudited Combined Financial Statements presented below.

These Unaudited Pro Forma Financial Statements have been developed from and should be read in conjunction with the respective audited and unaudited consolidated financial statements of Holly Energy Partners L.P. and UNEV Pipeline, LLC. The Unaudited Pro Forma Condensed Combined Financial Statements are provided for illustrative purposes only and do not purport to represent what the actual consolidated results of operations or the consolidated financial position of Holly Energy Partners L.P. would have been had the acquisition occurred on the dates assumed, nor are they necessarily indicative of future consolidated results of operations or consolidated financial position.

Holly Energy Partners L.P.

Unaudited Pro Forma Condensed Combined Balance Sheet

June 30, 2012

(In thousands)

	HEP		UNEV		Eliminations/ Adjustments			Adjusted -  HEP Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	4,216	$	—	$	—		$	4,216
Restricted cash		—		1,000		—		$	1,000
Accounts receivable:
Trade		3,836		1,051		—			4,887
Affiliates		26,333		3,668		(153	)		29,848
		30,169		4,719		(153	)		34,735
Prepaid and other current assets		3,410		43		—			3,453
Total current assets		37,795		5,762		(153	)		43,404
Properties and equipment, net		532,548		403,452		16,818			952,818
Transportation agreements, net		98,070		—		—			98,070
Goodwill		256,498		—		—			256,498
Investment in SLC Pipeline		25,427		—		—			25,427
Other assets		9,360		—		—			9,360
Total assets	$	959,698	$	409,214	$	16,665		$	1,385,577
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable:
Trade	$	4,983	$	1,952	$	—		$	6,935
Affiliates		4,712		597		(153	)		5,156
		9,695		2,549		(153	)		12,091
Accrued interest		9,655		—		—			9,655
Deferred revenue		3,603		2,534		—			6,137
Accrued property taxes		1,910		1,080		—			2,990
Other current liabilities		2,581		—		—			2,581
Total current liabilities		27,444		6,163		(153	)		33,454
Long-term debt		613,195		—		260,000			873,195
Other long-term liabilities		6,195		—		—			6,195
Class B unitholder		—		—		12,200			12,200
Equity:
Partners’ equity		312,864		302,288		(255,382	)		359,770
Noncontrolling interest		—		100,763		—			100,763
Total equity		312,864		403,051		(255,382	)		460,533
Total liabilities and equity	$	959,698	$	409,214	$	16,665		$	1,385,577

Holly Energy Partners L.P.

Unaudited Pro Forma Condensed Combined Statement of Income

Six Months Ended June 30, 2012

(In thousands, except per unit data)

	HEP			UNEV			Eliminations / Adjustments			Adjusted -  HEP Consolidated
Revenues:
Affiliates	$	107,017		$	5,256		$	(528	)	$	111,745
Third parties		20,190			2,557			—			22,747
		127,207			7,813			(528	)		134,492
Operating costs and expenses:
Operations		34,911			5,648			(528	)		40,031
Depreciation and amortization		19,396			7,124			334			26,854
General and administrative		4,526			—						4,526
		58,833			12,772			(194	)		71,411
Operating income (loss)		68,374			(4,959	)		(334	)		63,081
Other income (expense):
Equity in earnings of SLC Pipeline		1,625			—			—			1,625
Interest expense		(21,729	)		—			(3,879	)		(25,608	)
Loss on early extinguishment of debt		(2,979	)		—			—			(2,979	)
		(23,083	)		—			(3,879	)		(26,962	)
Income (loss) before income taxes		45,291			(4,959	)		(4,213	)		36,119
State income tax		(150	)		—			—			(150	)
Net Income (loss)		45,141			(4,959	)		(4,213	)		35,969
Noncontrolling interest		—			1,240			(454	)		786
Net income (loss) attributable to Holly Energy Partners		45,141			(3,719	)		(4,667	)		36,755
Less general partner interest in net income, including incentive distributions		11,425			(74	)		(93	)		11,258
Limited partners’ interest in net income (loss)	$	33,716		$	(3,645	)	$	(4,574	)	$	25,497
Limited partners’ per unit interest in earnings – basic and diluted:	$	1.23								$	0.90
Weighted average limited partners’ units outstanding		27,361						1,030			28,391

Holly Energy Partners L.P.

Unaudited Pro Forma Condensed Combined Statement of Income

Year Ended December 31, 2011

(In thousands, except per unit data)

	HEP			UNEV			Eliminations / Adjustments			Adjusted -  HEP Consolidated
Revenues:
Affiliates	$	167,626		$	313		$	(571	)	$	167,368
Third parties		45,923			2			—			45,925
		213,549			315			(571	)		213,293
Operating costs and expenses:
Operations		62,202			1,992			(571	)		63,623
Depreciation and amortization		33,150			1,758			—			34,908
General and administrative		6,576			—			—			6,576
		101,928			3,750			(571	)		105,107
Operating income (loss)		111,621			(3,435	)		—			108,186
Other income (expense):
Equity in earnings of SLC Pipeline		2,552			—			—			2,552
Interest expense		(35,959	)		—			(662	)		(36,621	)
Other income		17			—			—			17
		(33,390	)		—			(662	)		(34,052	)
Income (loss) before income taxes		78,231			(3,435	)		(662	)		74,134
State income tax		(234	)		—			—			(234	)
Net Income (loss)		77,997			(3,435	)		(662	)		73,900
Add net loss applicable to predecessor		3,775			—			—			3,775
Noncontrolling interest		—			859			(854	)		5
Net income (loss) attributable to Holly Energy Partners		81,772			(2,576	)		(1,516	)		77,680
Less general partner interest in net income, including incentive distributions		16,845			(52	)		(30	)		16,763
Limited partners’ interest in net income (loss)	$	64,927		$	(2,525	)	$	(1,486	)	$	60,917
Limited partners’ per unit interest in earnings – basic and diluted:	$	2.84								$	2.55
Weighted average limited partners’ units outstanding		22,836						1,030			23,866

Note 1. Basis of Presentation

Holly Energy Partners, L.P. (“HEP”) together with its consolidated subsidiaries, is a publicly held master limited partnership, currently 44% owned (including the 2% general partner interest) by HollyFrontier Corporation (“HFC”) and its subsidiaries.

UNEV Pipeline, LLC (“UNEV”), Delaware limited liability company, recently completed the UNEV Pipeline, a 400 mile, 12-inch refined products pipeline from Salt Lake City, Utah to Las Vegas, Nevada, together with terminal and ethanol blending facilities in the Cedar City, Utah and North Las Vegas areas and storage facilities at the Cedar City terminal. HEP, through its wholly-owned subsidiaries, owns 75% of the pipeline with a subsidiary of Sinclair Oil Corporation (“Sinclair”) owning the remaining 25% interest.

On July 12, 2012, HEP acquired HFC’s indirect 75% interest in UNEV. HEP paid consideration consisting of $260.0 million in cash and 1,029,900 of their common units, which as a result, increased HFC’s ownership interest in HEP from 42% to 44% (in each case, including the 2% general partner interest). Under the terms of the transaction, HEP also issued to HFC equity interests in its wholly owned subsidiary that entitles HFC to an interest in HEP’s share of future UNEV profits beginning in 2015 through 2032, subject to a cap of approximately $34.0 million and certain limitations.

The accompanying Unaudited Pro Forma Condensed Combined Financial Statements present the pro forma consolidated financial position and results of operations of HEP based upon the historical financial statements of HEP and UNEV, after giving effect to the acquisition and adjustments described in these notes, and are intended to reflect the impact of the acquisition on HEP’s consolidated financial statements. The accompanying Unaudited Pro Forma Condensed Combined Financial Statements are presented for illustrative purposes only.

HEP has revised the interest in net income attributable to the limited partners from what was originally reported in its historic financial statements in the Form 10-K for the year ended December 31, 2011. HEP acquired on November 9, 2011 from HFC certain tankage, loading rack and crude receiving assets located at HFC’s El Dorado and Cheyenne refineries. HEP accounted for this transaction as a business combination between entities under common control and was required to retrospectively adjust the operating results as if HFC had contributed the assets to HEP on July 1, 2011 (the date HFC acquired the assets). Although these assets did not generate revenues prior to November 9, 2011, HEP’s operating results included $3.8 million of operating costs and depreciation incurred by HFC prior to the acquisition date. This loss was allocated in the Form 10-K to the partners of HEP based on their respective partnership interests. As the pre-acquisition loss was not attributable to HEP, but rather to the predecessor, it should have been reported as a loss applicable to the predecessor. Limited partners’ interest in net income was originally reported at $61.2 million or $2.68 per unit. This classification change increased limited partners’ interest in net income to $64.9 million or $2.84 per unit. This change had no impact on the reported net income or distributable cash flow.

The Unaudited Pro Forma Condensed Combined Balance Sheet gives effect to the acquisition as if it had been consummated on June 30, 2012 and includes estimated pro forma adjustments. These adjustments are subject to further revision as additional information becomes available and additional analyses are performed. The Unaudited Pro Forma Condensed Combined Statements of Income for the six months ended June 30, 2012 and the year ended December 31, 2011 give effect to the acquisition as if it had been consummated on January 1, 2011, the beginning of the earliest period presented.

HEP is a consolidated variable interest entity of HFC. Therefore, as an entity under common control with HFC, we recorded the assets and liabilities on our balance sheet at HFC’s historic basis instead of our purchase price or fair value.

Note 2. Pro Forma Adjustments

The Unaudited Pro Forma Condensed Combined Financial Statements reflect the following adjustments:

(a) Properties and Equipment – Adjustment is to include capitalized interest incurred by HFC relating to its interest in the construction costs of the UNEV fixed assets. Adjustment to depreciation and amortization is for the related depreciation expense.

(b) Long-term debt – Adjustment is for the cash consideration portion of the acquisition cost that was financed through borrowings under HEP’s credit facility. Adjustment to interest expense is for the related interest costs.

(c) Class B unitholder – Adjustment is for the portion of the acquisition cost relating to HFC’s interest in HEP’s share of future UNEV profits.

(d) Partners’ equity – Adjustment is for elimination of UNEV’s acquired equity. Also includes the acquisition cost paid by issuance of common units, with an adjustment for difference between the purchase price and the transferred basis of assets acquired.

(e) Noncontrolling interests – Adjustments are for the 25% share of UNEV owned by a subsidiary of Sinclair and the accretion related to the Class B unitholder’s interest.

(f) Affiliates account receivables and payables – Adjustments are for elimination of related party transactions between HEP and UNEV.

(g) Affiliates revenue and operating expenses – Adjustments are for elimination of related party transactions between HEP and UNEV.