New York, July 11 - Valero Energy Corp. filed a registration statement with the Securities and Exchange Commission for $250 million of 2% mandatory convertible preferred stock which it issued to Orion Refining Corp.
Valero, a Houston-based refining company, issued the convertibles to Orion in connection with its purchase of Orion's refinery in Louisiana for $400 million plus $145 million for inventory and up to $175 million of earn-out payments. Orion is currently in Chapter 11.
The prospectus can be used by Orion or its creditors or stockholders who receive the convertible preferreds as part of the bankruptcy proceedings to resell the securities.
Terms of the convertibles are:
| Issuer: | Valero Energy Corp.
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| Issue: | Mandatory convertible preferred stock
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| Amount: | $250 million, 10 million shares with $25 liquidation preference
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| Maturity: | July 1, 2006
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| Dividend: | 2%, payable quarterly, non-cumulative
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| Optional conversion ratio: | 0.4955 at any time
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| Conversion ratio at maturity: | 0.4955 if Valero stock is at greater than $50.45
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| $25 if Valero stock is above $37.37 but no higher than $50.45
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| 0.6690 if Valero stock is below $37.37
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| Call: | Non-callable
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