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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 4, 1996
CLARK USA, INC.
(Exact name of registrant as specified in its charter)
Delaware 33-59144 43-1495734
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
8182 Maryland Avenue 63105-3721
St. Louis, Missouri (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including are code: (314) 854-9696
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Item 2. Acquisition or Disposition of Assets
On October 4, 1996, Clark Refining & Marketing, Inc. ("Clark"),
a wholly-owned subsidiary of Clark USA, Inc. ( the "Company"),
sold one of the Company's advance crude oil purchase receivables
and certain associated hedge contracts. The receivable together
with the associated hedge contracts was assigned to Clark by the
Company on October 3, 1996 at fair market value and recorded as
an equity contribution. The advance crude oil purchase receivable
was sold along with the associated hedge contracts to J. Aron &
Company for net cash proceeds of $235.4 million. The advance crude
oil purchase receivable was valued based on its defined future
delivery schedule, associated forward crude oil price quotes and
discounted for certain assumed credit risk factors.
As a result of the transaction, the Company substantially increased
its cash balance and will recognize approximately $110.6 million of
net equity issued as part of the original consideration for the
advance crude oil purchase receivable. The Company has historically
maintained substantial cash reserves to mitigate the cyclical nature of
its business. Such cash reserves may also be used to enhance existing
assets, for acquisitions or to reduce debt. The Company realized a
gain on the transaction.
The Company acquired the above referenced advance crude oil purchase
receivable in December 1995 from subsidiaries of Occidental Petroleum
Corporation ("Occidental"). The advance crude oil purchase receivable
originally entitled the Company to the equivalent of 17.661 million
barrels of West Texas Intermediate crude oil ("WTI") to be delivered
through 2001 according to a defined schedule (the "Occidental
Transaction"). The Company had collected value on approximately 1.5
million WTI equivalent barrels on the receivable prior to the sale.
In connection with the Occidental Transaction, the Company issued
common stock valued at approximately $120 million, or $22 per share
(3,954,545 shares of Common Stock and 1,500,000 shares of non-voting
Class D Common Stock which were converted into an equal number of
shares of Common Stock), and paid $100 million in cash to Occidental.
The Company had contracted to resell the Occidental oil to a marketing
subsidiary of Occidental immediately after delivery at then current
market prices.
The Company continues to own an advance crude oil purchase receivable
from subsidiaries of Gulf Resources Corporation ("Gulf") also acquired
in December, 1995. This agreement entitles the Company to receive
from 1996 through 2001, 3.164 million barrels of certain royalty oil
to be received by Gulf pursuant to agreements among Gulf, an Occidental
subsidiary and the Government of the Congo.
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EXHIBIT INDEX
2.1 Assignment and Assumption Agreement, dated as of October 4, 1996
among Clark Refining & Marketing, Inc., J. Aron & Company, Clark
USA, Inc. and for limited purposes, Occidental Petroleum
Corporation and Occidental Crude Sales, Inc. (Incorporated by
reference to Exhibit 2.1 filed with Clark Refining & Marketing,
Inc. Form 8-K dated October 4, 1996 (File No. 1-11392)
2.2 Assignment and Assumption Agreement, dated as of October 3, 1996
among Clark USA, Inc. and Clark Refining & Marketing, Inc.
(Incorporated by reference to Exhibit 2.2 filed with Clark
Refining & Marketing, Inc. Form 8-K dated October 4, 1996
(File No. 1-11392)
10.1 Agreement Regarding Limited Consent and Waiver to the Amended
and Restated Credit Agreement, dated as of September 30, 1996
(Incorporated by reference to Exhibit 10.1 filed with Clark
Refining & Marketing, Inc. Form 8-K dated October 4, 1996 (File
No. 1-11392)
10.2 Fourth Amendment to Amended and Restated Credit Agreement, dated
as of July 12, 1996 (Incorporated by reference to Exhibit 10.2
filed with Clark Refining & Marketing, Inc. Form 8-K dated
October 4, 1996 (File No. 1-11392)
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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 thereunto duly authorized.
Dated: October 16, 1996 CLARK USA, INC.
By: /s/ Dennis R. Eichholz
Dennis R. Eichholz
Controller and Treasurer