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): April 30, 2019

 

 

VALERO ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   1-13175   74-1828067

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

One Valero Way

San Antonio, Texas

  78249
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (210) 345-2000

 

 

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 (see General Instruction A.2. below):

 

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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 5.07 Submission of Matters to a Vote of Security Holders.

The 2019 annual meeting of the stockholders of Valero Energy Corporation was held April 30, 2019. Matters voted on at the annual meeting and the results thereof were as follows:

 

  (1)

Proposal 1 : Election of directors. The election of each director was approved as follows.

 

H. Paulett Eberhart

   shares voted      required vote *     vote received  

for

     300,778,298        >50.0     98.95

against

     3,178,315       

abstain

     640,983       

broker non-votes

     55,415,762       

 

Joseph W. Gorder

   shares voted      required vote *     vote received  

for

     286,612,002        >50.0     95.40

against

     13,824,762       

abstain

     4,160,832       

broker non-votes

     55,415,762       

 

Kimberly S. Greene

   shares voted      required vote *     vote received  

for

     302,197,635        >50.0     99.36

against

     1,938,389       

abstain

     461,572       

broker non-votes

     55,415,762       

 

Deborah P. Majoras

   shares voted      required vote *     vote received  

for

     298,067,229        >50.0     98.00

against

     6,078,671       

abstain

     451,696       

broker non-votes

     55,415,762       

 

Donald L. Nickles

   shares voted      required vote *     vote received  

for

     295,508,019        >50.0     97.17

against

     8,599,207       

abstain

     490,370       

broker non-votes

     55,415,762       

 

Philip J. Pfeiffer

   shares voted      required vote *     vote received  

for

     303,094,654        >50.0     99.66

against

     1,021,751       

abstain

     481,191       

broker non-votes

     55,415,762       

 

Robert A. Profusek

   shares voted      required vote *     vote received  

for

     293,651,868        >50.0     96.91

against

     9,348,360       

abstain

     1,597,368       

broker non-votes

     55,415,762       


Stephen M. Waters

   shares voted      required vote *     vote received  

for

     297,929,300        >50.0     97.97

against

     6,165,592       

abstain

     502,704       

broker non-votes

     55,415,762       

 

Randall J. Weisenburger

   shares voted      required vote *     vote received  

for

     302,037,376        >50.0     99.33

against

     2,050,259       

abstain

     509,961       

broker non-votes

     55,415,762       

 

Rayford Wilkins, Jr.

   shares voted      required vote *     vote received  

for

     302,368,197        >50.0     99.42

against

     1,752,320       

abstain

     477,079       

broker non-votes

     55,415,762       

 

  (2)

Proposal 2 : Ratify the appointment of KPMG LLP to serve as Valero’s independent registered public accounting firm for the fiscal year ending December 31, 2019. The proposal was approved as follows:

 

Proposal 2

   shares voted      required vote *     vote received  

for

     352,551,257        >50.0     97.93

against

     6,624,225       

abstain

     837,876       

broker non-votes

     n/a       

 

  (3)

Proposal 3 : Advisory vote to ratify the 2018 compensation of the named executive officers listed in the proxy statement. The proposal was approved as follows:

 

Proposal 3

   shares voted      required vote *     vote received  

for

     276,742,004        >50.0     90.85

against

     22,519,824       

abstain

     5,335,768       

broker non-votes

     55,415,762       

* Notes :

Required votes . For Proposal 1, as required by Valero’s bylaws, each director is to be elected by a majority of votes cast with respect to that director’s election. Proposals 2 and 3 required approval by the affirmative vote of a majority of the voting power of the shares present in person or by proxy at the annual meeting and entitled to vote.


Effect of abstentions. Shares voted to abstain are treated as “present” for purposes of determining a quorum. In the election of directors (Proposal 1), pursuant to Valero’s bylaws, shares voted to abstain are not deemed to be “votes cast,” and are accordingly disregarded. When, however, approval for a proposal requires the affirmative vote of a majority of the voting power of the shares present in person or by proxy and entitled to vote (Proposals 2 and 3), then shares voted to abstain have the effect of a negative vote.

Effect of broker non-votes. Brokers holding shares for the beneficial owners of such shares must vote according to specific instructions received from the beneficial owners. If instructions are not received, in some instances (e.g., for Proposal 2), a broker may nevertheless vote the shares in the broker’s discretion. Under New York Stock Exchange rules, brokers are precluded from exercising voting discretion on certain proposals without specific instructions from the beneficial owner (Proposals 1 and 3). This results in a “broker non-vote” on the proposal. A broker non-vote is treated as “present” for purposes of determining a quorum, has the effect of a negative vote when approval for a particular proposal requires the affirmative vote of the voting power of the issued and outstanding shares of the Company, and has no effect when approval for a proposal requires the affirmative vote of a majority of the voting power of the shares present in person or by proxy and entitled to vote.

 

Item 8.01

Other Events.

On April 30, 2019, Valero entered into a Stock Unit Award Agreement with each of its non-employee directors who was re-elected at the annual meeting of the stockholders. The grant of stock units, valued at $175,000, represents the equity portion of Valero’s non-employee director compensation program. Each stock unit represents the right to receive one share of Valero common stock, and is scheduled to vest (become nonforfeitable) in full on the date of Valero’s 2020 annual meeting of stockholders. The foregoing description of the stock units is not complete and is qualified in its entirety by reference to the full text of the agreements governing the awards, which are attached as Exhibits 10.01 and 10.02 to this Current Report and are incorporated herein by reference.

 

Item 9.01

Financial Statements and Exhibits.

 

  (d)

Exhibits.

 

10.01    Form of Stock Unit Award Agreement (standard).
10.02    Form of Stock Unit Award Agreement (with one-year hold provision).


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    VALERO ENERGY CORPORATION
Date: May 1, 2019     by:   /s/ J. Stephen Gilbert
      J. Stephen Gilbert, Secretary

Exhibit 10.01

STOCK UNIT AWARD AGREEMENT

This Stock Unit Award Agreement (“ Agreement ”), dated as of April 30, 2019 (the “ Grant Date ”), is between Valero Energy Corporation , a Delaware corporation (“ Valero ”), and «First_Name» «Last_Name» , a Non-Employee Director of the Board of Directors of Valero (“ Director ”), who agree as follows:

1.      Grant of Stock Units . Pursuant to the Valero Energy Corporation 2011 Omnibus Stock Incentive Plan (as may be amended, the “ Plan ”), Valero has granted pursuant to Section 6.8 of the Plan [                  ] Stock Units to the Director. The parties enter into this Agreement to evidence the terms, conditions, and restrictions applicable to the Stock Unit Award.

2.      The Plan . The Plan is incorporated herein by reference for all purposes. All capitalized terms contained in this Agreement shall have the definitions set forth in the Plan unless otherwise defined herein. The Director shall have no rights with respect to the Awards granted hereunder or any shares of Valero’s common stock, $.01 par value (“ Common Stock ”), that may be issued with respect to such Awards that are not expressly conferred by the Plan or this Agreement. By way of clarification and not limitation, the Director will not have any voting rights with respect to the Stock Units or the Dividend Equivalent Award.

3.      Vesting . Subject to Article 9 of the Plan, the Stock Units will vest (become nonforfeitable) in full on the date of the annual meeting of stockholders of Valero for the election of directors occurring in 2020 (the “ Vesting Date ”), whereupon the Director shall be entitled to the issuance of one share of Common Stock for each Stock Unit vesting on the Vesting Date. Upon the issuance of shares of Common Stock on the Vesting Date, the Stock Units will expire and have no further value or effect. The Director agrees that in lieu of certificates, the shares of Common Stock issuable in connection with the vesting of the Stock Units will be issued in uncertificated form pursuant to the Direct Registration System of Valero’s stock transfer agent.

4.      Dividend Equivalent Award . Subject to Article 9 of the Plan, the Director is hereby granted a Dividend Equivalent Award in addition to the Stock Unit Award. The Dividend Equivalent Award is payable in cash on the Vesting Date as provided herein. The period from the Grant Date to the Vesting Date is hereafter referred to as the “ Accumulation Period .” On the Vesting Date, the Director shall be paid in cash an amount equal to the cumulative amount of dividends paid to holders of Common Stock during the Accumulation Period — calculated as if each Stock Unit held by the Director was an outstanding share of Common Stock during the Accumulation Period. Payment of the Dividend Equivalent Award is subject to the vesting of the Stock Units on the Vesting Date; no payment will be made to the Director with respect to the Dividend Equivalent Award if the Stock Units are forfeited prior to the Vesting Date.

5.      Cash Payment Election . Effective on the Vesting Date, the Director may elect to receive either 22% or 37% of the fair market value of the aggregate number of shares of Common Stock to be delivered to the Director on the Vesting Date in cash, with the remainder paid in shares of Common Stock. Example :

 

   

assume that on the Vesting Date, the Director will be entitled to receive 1,750 shares of Common Stock,

 

   

assume that the 1,750 shares have an aggregate fair market value of $175,000 (1,750 times an assumed $100.00 FMV per share on the Vesting Date), and the Director has made an election to receive up to 22% in cash,

 

   

maximum cash is $38,500 ($175,000 times 22%),

 

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on the Vesting Date, the Director will receive:

 

  (a)

1,365 shares of Common Stock ($175,000 times 78% = $136,500, divided by $100.00 FMV/sh = 1,365 shares),

 

  (b)

cash in the amount of $38,500, and

 

  (c)

cash in an amount equal to the cash value of the Dividend Equivalent Award.

6.      Nontransferable . The Stock Units and the Dividend Equivalent Award may not be sold, exchanged, pledged, hypothecated, transferred, garnished, or otherwise disposed of or alienated prior to vesting.

7 .     Final Term of Service . For avoidance of doubt, and for purposes of this Agreement and the vesting of the Stock Unit Award hereunder (only), for a Director who serves his or her final term on the Board and does not stand for re-election on the Vesting Date, the Director will be deemed to be an actively serving Director on the Board on the Vesting Date, and accordingly, his or her Stock Unit Award will not lapse or be forfeited under Section 9.2 of the Plan as a result of not standing for re-election.

8 .     Miscellaneous . This Agreement shall be binding upon the parties hereto and their respective beneficiaries, heirs, administrators, executors, legal representatives, and successors. This Agreement shall be construed under the laws of the State of Texas.

9 .     Code Section  409A . The issuance of shares of Common Stock and the payment of any cash under this Agreement shall be made on or as soon as reasonably practical following the Vesting Date, but in any event no later than the 15th day of the third month following the end of the year in which the applicable Vesting Date occurs. This Agreement and the awards evidenced hereby are intended to comply, and shall be administered consistently, in all respects with Section 409A of the Internal Revenue Code and the regulations promulgated thereunder. If necessary in order to ensure such compliance, this Agreement may be reformed consistent with guidance issued by the Internal Revenue Service.

EFFECTIVE as of the Grant Date stated above.

 

VALERO ENERGY CORPORATION
 

 

Julia R. Reinhart,
Senior Vice President–Human Resources & Administration
 

 

«First_Name» «Last_Name»

 

Page 2

Exhibit 10.02

STOCK UNIT AWARD AGREEMENT

(with one year holding period)

This Stock Unit Award Agreement (“ Agreement ”), dated as of April 30, 2019 (the “ Grant Date ”), is between Valero Energy Corporation , a Delaware corporation (“ Valero ”), and «First_Name» «Last_Name» , a Non-Employee Director of the Board of Directors of Valero (“ Director ”), who agree as follows:

1.      Grant of Stock Units . Pursuant to the Valero Energy Corporation 2011 Omnibus Stock Incentive Plan (as may be amended, the “ Plan ”), Valero has granted pursuant to Section 6.8 of the Plan [                 ] Stock Units to the Director. The parties enter into this Agreement to evidence the terms, conditions, and restrictions applicable to the Stock Unit Award.

2.      The Plan . The Plan is incorporated herein by reference for all purposes. All capitalized terms contained in this Agreement shall have the definitions set forth in the Plan unless otherwise defined herein. The Director shall have no rights with respect to the Awards granted hereunder or any shares of Valero’s common stock, $.01 par value (“ Common Stock ”), that may be issued with respect to such Awards that are not expressly conferred by the Plan or this Agreement. By way of clarification and not limitation, the Director will not have any voting rights with respect to the Stock Units or the Dividend Equivalent Award.

3.      Vesting and Hold Period .

(a) Subject to Article 9 of the Plan, the Stock Units will vest (become nonforfeitable) in full on the date of the annual meeting of stockholders of Valero for the election of directors occurring in 2020 (the “ Vesting Date ”).

(b) The Director agrees to hold the Stock Units for a period of at least one-year following the Vesting Date (the “ Hold Period ”). The Director agrees that the Stock Units may not be sold, exchanged, pledged, hypothecated, transferred, garnished, or otherwise disposed of or alienated, or converted into shares of Common Stock, prior to the expiration of the Hold Period. The Director and Valero hereby waive any provision of the Plan that would allow for an acceleration of the Vesting Date or early termination of the Hold Period, including but not limited to Sections 6.8(b)(v), 8.2, 9.4, and 12.2 of the Plan, and agree that the terms of this Agreement shall prevail over any conflicting terms in the Plan or other agreement or action by the Committee.

(c) Upon the expiration of the Hold Period (the “ Hold Period Expiration Date ”), the Director shall be entitled to the issuance of one share of Common Stock for each Stock Unit held by the Director. Upon the issuance of shares of Common Stock on the Hold Period Expiration Date, the Stock Units will expire and have no further value or effect. The Director agrees that in lieu of certificates, the shares of Common Stock issuable hereunder will be issued in uncertificated form pursuant to the Direct Registration System of Valero’s stock transfer agent.

4.      Dividend Equivalent Award . Subject to Article 9 of the Plan, the Director is hereby granted a Dividend Equivalent Award in addition to the Stock Unit Award. The Dividend Equivalent Award is payable in cash on the Hold Period Expiration Date as provided herein. The period from the Grant Date to the Hold Period Expiration Date is hereafter referred to as the “ Accumulation Period .” On the Hold Period Expiration Date, the Director shall be paid in cash an amount equal to the cumulative amount of dividends paid to holders of Common Stock during the Accumulation Period — calculated as if each Stock Unit held by the Director was an outstanding share of Common Stock during the Accumulation Period. Payment of the Dividend Equivalent Award is subject to the vesting of the Stock Units on the Vesting Date; no payment will be made to the Director with respect to the Dividend Equivalent Award if the Stock Units are forfeited prior to the Vesting Date. The Dividend Equivalent Award may not be sold, exchanged, pledged, hypothecated, transferred, garnished, or otherwise disposed of or alienated prior to the Hold Period Expiration Date.

 

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5.      Cash Payment Election . Effective on the Hold Period Expiration Date, the Director may elect to receive either 22% or 37% of the fair market value of the aggregate number of shares of Common Stock to be delivered to the Director on the Hold Period Expiration Date in cash, with the remainder paid in shares of Common Stock. Example :

 

   

assume that on the Hold Period Expiration Date, the Director will be entitled to receive 1,750 shares of Common Stock,

 

   

assume that the 1,750 shares have an aggregate fair market value of $175,000 (1,750 times an assumed $100.00 FMV per share on the Hold Period Expiration Date), and the Director has made an election to receive up to 22% in cash,

 

   

maximum cash is $38,500 ($175,000 times 22%),

 

   

on the Hold Period Expiration Date, the Director will receive:

 

  (a)

1,365 shares of Common Stock ($175,000 times 78% = $136,500, divided by $100.00 FMV/sh = 1,365 shares),

 

  (b)

cash in the amount of $38,500, and

 

  (c)

cash in an amount equal to the cash value of the Dividend Equivalent Award.

6 .     Final Term of Service . For avoidance of doubt, and for purposes of this Agreement and the vesting of the Stock Unit Award hereunder (only), for a Director who serves his or her final term on the Board and does not stand for re-election on the Vesting Date, the Director will be deemed to be an actively serving Director on the Board on the Vesting Date, and accordingly, his or her Stock Unit Award will not lapse or be forfeited under Section 9.2 of the Plan as a result of not standing for re-election.

7 .     Miscellaneous . This Agreement shall be binding upon the parties hereto and their respective beneficiaries, heirs, administrators, executors, legal representatives, and successors. This Agreement shall be construed under the laws of the State of Texas.

8 .     Code Section  409A . The issuance of shares of Common Stock and the payment of any cash under this Agreement shall be made on or as soon as reasonably practical following the Hold Period Expiration Date, but in any event no later than the 15th day of the third month following the end of the year in which the applicable Hold Period Expiration Date occurs. This Agreement and the awards evidenced hereby are intended to comply, and shall be administered consistently, in all respects with Section 409A of the Internal Revenue Code and the regulations promulgated thereunder. If necessary in order to ensure such compliance, this Agreement may be reformed consistent with guidance issued by the Internal Revenue Service.

EFFECTIVE as of the Grant Date stated above.

 

VALERO ENERGY CORPORATION
 

 

Julia R. Reinhart,
Senior Vice President–Human Resources & Administration
 

 

«First_Name» «Last_Name»

 

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