Exhibit 10.03

FORM OF RESTRICTED STOCK AGREEMENT

This Restricted Stock Agreement (“Agreement”) is between Valero Energy
Corporation, a Delaware corporation (“Valero”), and __________________, a
Non-Employee Director of the Board of Directors of Valero (“Director”); who
agree as follows:

     1. Introduction. Pursuant to the Valero Energy Corporation Restricted Stock
Plan for Non-Employee Directors (as may be amended, the “Director Plan”), Valero
has granted ___ shares of its Common Stock, $.01 par value (“Restricted Shares”)
to the Director. As directed by the Director Plan, the parties enter into this
Agreement to evidence the terms, conditions and restrictions applicable to the
Restricted Shares.

     2. The Director Plan, Restrictions, Vesting. The Director has read and
understands the Director Plan, which is incorporated herein by reference for all
purposes, and agrees to the terms and conditions applicable to the Restricted
Shares and the rights and powers of Valero as provided therein. In addition, the
Director agrees as follows:

     2.01 Except as provided in the Director Plan and this Agreement, Restricted
Shares may not be sold, exchanged, pledged, hypothecated, transferred, garnished
or otherwise disposed of or alienated prior to vesting.

     2.02 Restricted Shares granted hereunder shall vest and accrue to the
Director in the following increments: _________ shares on the date of the annual
meeting of stockholders of Valero Energy Corporation for election of directors
of Valero (“Annual Meeting”) occurring in 2006; _________ shares on the date of
the Annual Meeting occurring in 2007; and _________ shares on the date of the
Annual Meeting occurring in 2008. The restrictions may terminate prior to the
expiration of such period as set forth in the Director Plan.

     2.03 The Director agrees that in lieu of certificates representing the
Director’s Restricted Shares, the Restricted Shares and the shares of Common
Stock issuable in connection with the vesting of the Restricted Shares may be
issued in uncertificated form pursuant to the Direct Registration Service
(“DRS”) of Valero’s stock transfer agent.

     2.04 If, as the result of a stock split, stock dividend, combination of
shares or any other change, including an exchange of securities, for any reason,
the Director shall be entitled to new or additional or different shares of stock
or securities, such stock or securities shall be subject to the terms and
conditions of the Plan and this Agreement.

     2.05 If Restricted Shares are forfeited per the terms of the Director Plan,
the stock transfer agent of Valero is instructed, upon confirmation by the
Corporate Secretary of such forfeiture, to surrender the certificates
representing such shares for cancellation, or the cancel the forfeited shares
from the Directors’ DRS account.

     3. Limitation. The Director shall have no rights with respect to any
Restricted Shares not expressly conferred by the Director Plan or this
Agreement.

     4. Miscellaneous. All capitalized terms contained in this Agreement shall
have the definitions set forth in the Director Plan unless otherwise defined
herein. This Agreement shall be binding upon the parties hereto and their
respective beneficiaries, heirs, administrators, executors, legal
representatives, and successors.

     EFFECTIVE as of the ______ day of ______ 2005.

     

  VALERO ENERGY CORPORATION
 
   

  Mike Crownover, Director – Human Resources
 
   

 

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  [name of non-employee director]