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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): MAY 17, 2002
TESORO PETROLEUM CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 1-3473 95-0862768
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
300 CONCORD PLAZA DRIVE 78216-6999
SAN ANTONIO, TEXAS (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (210) 828-8484
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On May 17, 2002, Tesoro Petroleum Corporation ("Tesoro" or the
"Company") completed the acquisition of the 168,000 barrel-per-day Golden Eagle
refinery located in Martinez, California in the San Francisco Bay area along
with 70 associated retail sites throughout northern California (collectively,
the "Golden Eagle Assets") from Ultramar Inc., a subsidiary of Valero Energy
Corporation. The acquisition was completed pursuant to a Sale and Purchase
Agreement, dated February 4, 2002, by and among Ultramar Inc. and Tesoro
Refining and Marketing Company, as amended on February 20, 2002 and May 3, 2002,
incorporated herein by reference as Exhibit 2.1 to this Current Report on Form
8-K. The Company intends to utilize the Golden Eagle Assets in a similar manner
as the seller.
The purchase price for the Golden Eagle Assets, as amended, was $945
million, plus $130 million for feedstock and refined product inventories,
subject to post-closing adjustments. The Company issued to the seller two
ten-year junior subordinated notes with face amounts aggregating $150 million as
part of the $945 million purchase price. The notes consist of: (i) a $100
million junior subordinated note, due July 2012, which will be non-interest
bearing for the first five years and carry a 7.5% interest rate for the
remaining five-year period, and (ii) a $50 million junior subordinated note, due
July 2012, which will have no interest payment in year one, will include a 7.47%
effective interest rate for the second through the fifth years, and will bear
interest at 7.5% for years six through ten. Copies of The $100 million and $50
million junior subordinated notes are filed as Exhibits 10.1 and 10.2 to this
Current Report on Form 8-K and are incorporated herein by reference. The Company
further funded the acquisition of the Golden Eagle Assets with borrowings under
its amended and restated Senior Secured Credit Facility (see Item 5), proceeds
of a recent common stock offering and the proceeds of a recent senior
subordinated notes offering. The Company also assumed certain liabilities and
obligations (including costs associated with transferred employees and
environmental matters, among others) subject to certain levels of
indemnification.
In connection with the acquisition of the Golden Eagle Assets, the
Company entered into a letter agreement, dated May 5, 2002, with the State of
California Department of Justice, Office of the Attorney General, which is filed
as Exhibit 10.3 to this Current Report on Form 8-K and is incorporated herein by
reference.
The foregoing is qualified by reference to Exhibits 2.1, 10.1, 10.2 and
10.3 to this Current Report on Form 8-K, which are incorporated herein by
reference.
ITEM 5. OTHER EVENTS
On May 17, 2002, the Company amended and restated its Senior Secured
Credit Facility to increase the facility to $1.275 billion consisting of (i) a
$225 million revolving credit facility (with a $150 million sublimit for letters
of credit) which will terminate on September 6, 2006, (ii) a $250 million
tranche A term loan which terminates on December 31, 2006 and (iii) a $800
million tranche B term loan which terminates on December 31, 2007. The Company
entered into this amended and restated Senior Secured Credit Facility with
Lehman Brothers Inc. as arranger, Lehman Commercial Paper Inc. as syndication
agent, Bank One, NA as administrative agent, ABN Amro Bank N.V., Credit Lyonnais
New York Branch and The Bank of Nova Scotia, as co-documentation agents, and a
syndicate of banks, financial institutions and other entities. The amended
facility includes a minimum Consolidated EBITDA (as defined in the amended and
restated Senior Secured Credit Facility) covenant of $40 million applicable only
to the second quarter of 2002, eliminates the total debt to EBITDA test and
substitutes a new senior debt to EBITDA test beginning in the third quarter of
2002. The amended facility also includes interest and fixed charge coverage
tests beginning in the third quarter of 2002. These coverage tests are similar
to the original facility except that the new facility provides that for purposes
of determining compliance with the tests, EBITDA attributable to the Golden
Eagle Assets shall be based on the results of operations after the acquisition
thereof. The incremental proceeds from the term loans were used to partially
fund the acquisition of the Golden Eagle Assets. A copy of the amended and
restated Senior Secured Credit Facility is filed as Exhibit 10.4 to this Current
Report on Form 8-K and is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial statements of businesses acquired.
The audited financial statements of Golden Eagle Refining and
Marketing Assets Business as of December 31, 2001 and 2000 and for the
year ended December 31, 2001 and the four months ended December 31,
2000 were filed on Form 8-K under Item 7 on February 22, 2002. The
unaudited financial statements as of March 31, 2002 and for the three
months ended March 31, 2002 and 2001 specified in Rule 3-05(b) of
Regulation S-X will be filed by amendment to this Current Report on
Form 8-K no later than sixty days after the date on which this Current
Report on Form 8-K is required to be filed.
(b) Pro forma financial information.
The pro forma financial statements required pursuant to
Article 11 of Regulation S-X will be filed by amendment to this Current
Report on Form 8-K no later than sixty days after the date on which
this Current Report on Form 8-K is required to be filed.
(c) Exhibits.
2.1 Sale and Purchase Agreement for Golden Eagle Refining
and Marketing Assets, dated February 4, 2002, by and
among Ultramar Inc. and Tesoro Refining and Marketing
Company, including First Amendment dated February 20,
2002 and related Purchaser Parent Guaranty dated
February 4, 2002 (incorporated by reference to
Exhibit 2.12 to the Company's Annual Report on Form
10-K for the year ended December 31, 2001, File No.
1-3473) and Second Amendment dated May 3, 2002
(incorporated by reference to Exhibit 2.1 to the
Company's Current Report on Form 8-K filed May 9,
2002, File No. 1-3473).
10.1 $100 million Promissory Note, dated as of May 17,
2002, payable by the Company to Ultramar Inc.
10.2 $50 million Promissory Note, dated as of May 17,
2002, payable by the Company to Ultramar Inc.
10.3* Letter dated May 5, 2002 from the Company to the
State of California Department of Justice, Office of
the Attorney General.
10.4 $1,275,000,000 Amended and Restated Credit Agreement,
dated as of May 17, 2002, among the Company and
Lehman Brothers Inc. (arranger), Lehman Commercial
Paper Inc. (the syndication agent), Bank One, NA (the
administrative agent) and a syndicate of banks,
financial institutions and other entities. Certain
schedules and exhibits to this Amended and Restated
Credit Agreement have not been filed with this
exhibit. The Company agrees to furnish supplementally
any omitted schedule or exhibit to the SEC upon
request.
* Portions have been omitted pursuant to a request for
confidential treatment.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date: May 24, 2002
TESORO PETROLEUM CORPORATION
By: /s/ Gregory A. Wright
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Gregory A. Wright
Senior Vice President
and Chief Financial Officer
INDEX TO EXHIBITS
<Table>
<Caption>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
2.1 Sale and Purchase Agreement for Golden Eagle Refining
and Marketing Assets, dated February 4, 2002, by and
among Ultramar Inc. and Tesoro Refining and Marketing
Company, including First Amendment dated February 20,
2002 and related Purchaser Parent Guaranty dated
February 4, 2002 (incorporated by reference to
Exhibit 2.12 to the Company's Annual Report on Form
10-K for the year ended December 31, 2001, File No.
1-3473) and Second Amendment dated May 3, 2002
(incorporated by reference to Exhibit 2.1 to the
Company's Current Report on Form 8-K filed May 9,
2002, File No. 1-3473).
10.1 $100 million Promissory Note, dated as of May 17,
2002, payable by the Company to Ultramar Inc.
10.2 $50 million Promissory Note, dated as of May 17,
2002, payable by the Company to Ultramar Inc.
10.3* Letter dated May 5, 2002 from the Company to the
State of California Department of Justice, Office of
the Attorney General.
10.4 $1,275,000,000 Amended and Restated Credit Agreement,
dated as of May 17, 2002, among the Company and
Lehman Brothers Inc. (arranger), Lehman Commercial
Paper Inc. (the syndication agent), Bank One, NA (the
administrative agent) and a syndicate of banks,
financial institutions and other entities. Certain
schedules and exhibits to this Amended and Restated
Credit Agreement have not been filed with this
exhibit. The Company agrees to furnish supplementally
any omitted schedule or exhibit to the SEC upon
request.
</Table>
* Portions have been omitted pursuant to a request for
confidential treatment.