press release

Unocal Registration Statement Cleared by SEC

El Segundo, Calif., Aug. 7, 1996 -- Unocal Corporation today said that the Securities and Exchange Commission has declared effective the registration statement for new 6-1/4% Trust Convertible Preferred Securities of Unocal Capital Trust. Unocal will offer these securities in exchange for its $3.50 Convertible Preferred Stock.

The exchange offer will commence on Aug. 8, 1996, and is scheduled to expire on Sept. 5, 1996, unless extended.

The purpose of the exchange offer is to refinance the $3.50 Convertible Preferred Stock with the Trust Convertible Preferred Securities.

Unocal will announce the exchange ratio for the new Trust Convertible Preferred Securities two business days before the expiration date of the exchange offer. The exchange ratio will be determined by a formula, which will be set out in the prospectus, that gives the holder 6-1/4% Trust Convertible Preferred Securities with a liquidation value equal to the greater of the redemption value or the conversion value of the existing preferred stock.

The Trust Convertible Preferred Securities will have an annual distribution rate of 6-1/4 percent. The new securities will be convertible into Unocal common stock at a conversion premium of 24 percent above the average closing price of Unocal common stock for the five trading days preceding the determination of the exchange ratio.

Consummation of the exchange offer will be conditioned on receipt of at least 4,000,000 validly tendered shares of the $3.50 Convertible Preferred Stock.

Morgan Stanley & Co. Incorporated and Goldman, Sachs & Co. will act as dealer managers to solicit exchanges. The Bank of New York will act as exchange agent.

A prospectus for the exchange offer will be available from D.F. King & Co., 77 Water Street, New York, NY 10005 (toll free: 800/848-3051; collect 212/269-5550), which has been retained as information agent. Holders of the $3.50 Convertible Preferred Stock should contact Morgan Stanley (800/835-9668 ext. 2262) or Goldman, Sachs (800/323-5678) for additional information.

Updated: August 1996