SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 11-K
Annual Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
(Mark One)
[X] Annual report pursuant to Section 15(d) of the Securities Exchange
Act OF 1934
For the fiscal year ended December 31, 1996
-----------------
Or
[ ] Transition report pursuant to Section 15(d) of the Securities Exchange
Act of 1934
For the transition period from to
----------------- --------------
Commission file number 1-8483
--------------
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
UNOCAL SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the Plan and the address
of its principal executive office:
Unocal Corporation
2141 Rosecrans Avenue, Suite 4000, El Segundo, California 90245
<PAGE>
INDEX TO FINANCIAL STATEMENTS OF THE UNOCAL SAVINGS PLAN
The following financial statements reflect the status of the Unocal
Savings Plan as of December 31, 1996 and 1995, and the results of its
transactions for each of the years then ended.
Page Number
-----------
Statements included herein:
Report of Independent Accountants..........................................2
Statements of Net Assets Available for Benefits
with Fund Information ..................................................3-4
Statements of Changes in Net Assets Available
for Benefits with Fund Information.....................................5-6
Notes to Financial Statements...........................................7-10
Item 27(a) - Schedule of Assets Held for Investment Purposes..............12
Item 27(d) - Schedule of Reportable Transactions..........................13
Exhibit Index ............................................................14
Schedules I, II and III are omitted because the subject matter did not
exist or the required information is given in the financial statements or notes
to financial statements.
1
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Unocal Savings Plan/ESOP Committee:
We have audited the accompanying statements of net assets available for
benefits of the Unocal Savings Plan (the "Plan") as of December 31, 1996 and
1995, and the related statements of changes in net assets available for benefits
for the years then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the net assets available for benefits of the Plan as
of December 31, 1996 and 1995, and the changes in net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules of
assets held for investment purposes and reportable transactions are presented
for the purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The fund information in the
statements of net assets available for benefits and the statements of changes in
net assets available for benefits is presented for purposes of additional
analysis rather than to present the net assets available for plan benefits and
changes in net assets available for plan benefits of each fund. The supplemental
schedules and fund information have been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, are
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
COOPERS & LYBRAND L. L. P.
June 23, 1997
Los Angeles, California
2
<PAGE>
<TABLE>
<CAPTION>
Unocal Savings Plan
Statement of Net Assets Available for Benefits with Fund Information
December 31, 1996
Non-Participant
Directed Participant Directed
---------- ----------------------------------------------------------------------
Unocal S&P Low
Common 500 George Putnam Volatility Money New
Stock Index Fund Fund of Boston Trust Fund Market Fund Opportunities
-----------------------------------------------------------------------------------------------------------------------------------
Assets
Investments at fair value (Note 2)
<S> <C> <C> <C> <C> <C>
Unocal Common Stock .................... $329,991,884 $ -- -- $ -- $ -- $ --
Shares of registered
investment companies:
S&P 500 Index Fund .................. -- 39,659,989 -- -- -- --
George Putnam Fund of Boston ........ -- -- 28,940,379 -- -- --
Low Volatility Trust ................ -- -- -- 4,240,936 -- --
Money Market Fund ................... -- -- -- -- 12,007,378 --
New Opportunities Fund .............. -- -- -- -- -- 13,768,188
Voyager ............................. -- -- -- -- -- --
Participant notes
receivable (loans) ................ -- -- -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------
Total investments .............. 329,991,884 39,659,989 28,940,379 4,240,936 12,007,378 13,768,188
Cash ..................................... -- -- -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------
Total Assets .................... 329,991,884 39,659,989 28,940,379 4,240,936 12,007,378 13,768,188
Liabilities
Amounts due to Plan Sponsor ........... 628,608 -- -- -- -- --
------------ ------------ ------------ ------------ ------------ ------------
Total liabilities .................. 628,608 -- -- -- -- --
Net assets available for benefits ........ $329,363,276 $ 39,659,989 $ 28,940,379 $ 4,240,936 $ 12,007,378 $ 13,768,188
============ ============ ============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
Participant Directed
------------------------------------------------
Unocal
Common
Voyager Stock Other Total
------------- ---------------- -------------- ---------------
Assets
Investments at fair value (Note 2)
<S> <C> <C> <C>
Unocal Common Stock .............................. $ -- $153,834,109 $483,825,993
Shares of registered
investment companies:
S&P 500 Index Fund ............................ -- -- -- 39,659,989
George Putnam Fund of Boston .................. -- -- -- 28,940,379
Low Volatility Trust .......................... -- -- -- 4,240,936
Money Market Fund ............................. -- -- -- 12,007,378
New Opportunities Fund ........................ -- -- -- 13,768,188
Voyager ....................................... 7,208,151 -- -- 7,208,151
Participant notes receivable (loans) .......... -- -- 16,636,176 16,636,176
------------ ------------ ------------ ------------
Total investments .......................... 7,208,151 153,834,109 16,636,176 606,287,190
Cash ................................................... -- 196,435 -- 196,435
------------ ------------ ------------ ------------
Total Assets .................................. 7,208,151 154,030,544 16,636,176 606,483,625
Liabilities
Amounts due to Plan Sponsor ......................... -- -- -- 628,608
------------ ------------ ------------ ------------
Total liabilities ................................ -- -- -- 628,608
Net assets available for benefits ...................... $ 7,208,151 $154,030,544 $ 16,636,176 $605,855,017
============ ============ ============ ============
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Unocal Savings Plan
Statement of Net Assets Available for Benefits with Fund Information
December 31, 1995
Non-Participant
Directed Participant Directed
------------------ ------------------------------------------------------------------
Unocal Low
Common S&P 500 George Putnam Volatility Money
Stock Index Fund Fund of Boston Trust Fund Market Fund
------------------ ------------------------------------------------------------------
Assets
Investments at fair value
(Note 2)
<S> <C> <C> <C> <C> <C>
Unocal Common Stock ..................... $245,373,554 $ -- $ -- $ -- $ --
Shares of registered
investment companies:
S&P 500 Index Fund .................. -- 16,019,842 -- -- --
George Putnam Fund of Boston ........ -- -- 12,482,262 -- --
Low Volatility Trust ................ -- -- -- 2,030,022 --
Money Market Fund ................... -- -- -- -- 2,883,987
Participant notes receivable ........ -- -- -- -- --
----------- ------------ ------------ ------------ ----------
Total investments ................. 245,373,554 16,019,842 12,482,262 2,030,022 2,883,987
Cash .......................................... -- -- -- -- --
Receivables
Company contributions ..................... 3,834 -- -- -- --
Participant contributions ................. -- -- -- -- --
------------ ------------ ------------ --------- ---------
Total Assets ......................... 245,377,388 16,019,842 12,482,262 2,030,022 2,883,987
Liabilities
Amounts due to Plan Sponsor ................ 336,098 -- -- -- --
------------ ------------ ------------ ----------------------------
Total liabilities ....................... 336,098 -- -- -- --
Net assets available for benefits ............. $245,041,290 $ 16,019,842 $ 12,482,262 $ 2,030,022 $ 2,883,987
============ ============ ============ ============ ============
Participant Directed
-------------------------------
Unocal Common Other Total
Stock
------------ ------------ ------------
Assets
Investments at fair value
(Note 2)
<S> <C> <C> <C>
Unocal Common Stock .................................. $154,737,626 $ -- $400,111,180
Shares of registered
investment companies:
S&P 500 Index Fund ............................... -- -- 16,019,842
George Putnam Fund of Boston ..................... -- -- 12,482,262
Low Volatility Trust ............................. -- -- 2,030,022
Money Market Fund ................................ -- -- 2,883,987
Participant notes receivable ..................... -- 13,181,171 13,181,171
------------ ------------ ------------
Total investments .............................. 154,737,626 13,181,171 446,708,464
Cash ....................................................... 86,912 -- 86,912
Receivables
Company contributions .................................. -- -- 3,834
Participant contributions .............................. 6,391 -- 6,391
------------ ------------ ------------
Total Assets ...................................... 154,830,929 13,181,171 446,805,601
Liabilities
Amounts due to Plan Sponsor ............................. -- -- 336,098
------------ ------------ ------------
Total liabilities .................................... -- -- 336,098
Net assets available for benefits .......................... $154,830,929 $ 13,181,171 $446,469,503
============ ============ ============
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Unocal Savings Plan
Statement of Changes in Net Assets Available for Benefits with Fund Information
For the Year Ended December 31, 1996
Non-Participant
Directed Participant Directed
----------------------------------------------------------------------------
Unocal Low
Common S&P 500 George Putnam Volatility Money
Stock Index Fund Fund of Boston Trust Fund Market Fund
--------------- -------------- ---------------- ------------- -----------
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in fair value
<S> <C> <C> <C> <C> <C>
of investments ........................... $ 95,168,952 $ 6,407,719 $ 3,547,841 $ 130,457 $ 394,656
Interest .................................... -- 228,933 177,986 24,910 26,085
Dividends ................................... 6,672,799 -- -- -- --
------------ ------------ ------------ ------------ ------------
Total investment income ................... 101,841,751 6,636,652 3,725,827 155,367 420,741
Contributions
Participant ..................................... -- 9,204,749 7,212,903 1,259,891 2,783,664
Company ......................................... 22,731,422 -- -- -- --
------------ ------------ ------------ ------------ ------------
Total contributions .......................... 22,731,422 9,204,749 7,212,903 1,259,891 2,783,664
Total additions ........................... 124,573,173 15,841,401 10,938,730 1,415,258 3,204,405
Deductions from net assets attributed to:
Participants withdrawals & distributions ........ 40,251,162 2,070,285 1,744,671 295,665 2,765,931
Trustee fees and other expenses ................. 25 7,426 4,239 666 1,249
------------ ------------ ------------ ------------ ------------
Total deductions ............................. 40,251,187 2,077,711 1,748,910 296,331 2,767,180
Net increase (decrease) prior
to interfund transfers .......................... 84,321,986 13,763,690 9,189,820 1,118,927 437,225
Interfund transfers ................................ -- 9,876,457 7,268,297 1,091,987 8,686,166
------------ ------------ ------------ ------------ ------------
Net increase (decrease) ................... 84,321,986 23,640,147 16,458,117 2,210,914 9,123,391
Net assets available for benefits:
Beginning of year ............................... 245,041,290 16,019,842 12,482,262 2,030,022 2,883,987
------------ ------------ ------------ ------------ ------------
End of year ..................................... $329,363,276 $ 39,659,989 $ 28,940,379 $ 4,240,936 $ 12,007,378
============ ============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
Participant Directed
------------------------------------------------------------------
Unocal
New Common
Opportunities Voyager Stock Other Total
--------------- ------------- ----------------- ---------------- --------
Additions to net assets attributed to:
Investment income
Net appreciation (depreciation) in fair value
<S> <C> <C> <C> <C>
of investments ........................ $ (244,371) $ 163,672 $ 48,279,886 $ $ 153,848,812
Interest ................................. 60,613 30,366 464,114 -- 1,013,007
Dividends ................................ -- -- 3,529,550 -- 10,202,349
------------- ------------- ------------- ------------- -------------
Total investment income ................ (183,758) 194,038 52,273,550 -- 165,064,168
Contributions
Participant .................................. 2,164,478 1,220,965 11,829,369 -- 35,676,019
Company ...................................... -- -- -- -- 22,731,422
------------- ------------- ------------- ------------- -------------
Total contributions ....................... 2,164,478 1,220,965 11,829,369 -- 58,407,441
Total additions ........................ 1,980,720 1,415,003 64,102,919 -- 223,471,609
Deductions from net assets attributed to:
Participants withdrawals & distributions ..... 309,188 177,965 15,651,422 777,343 64,043,632
Trustee fees and other expenses .............. 1,605 900 26,353 -- 42,463
------------- ------------- ------------- ------------- -------------
Total deductions .......................... 310,793 178,865 15,677,775 777,343 64,086,095
Net increase (decrease) prior
to interfund transfers ....................... 1,669,927 1,236,138 48,425,144 (777,343) 159,385,514
Interfund transfers ............................. 12,098,261 5,972,013 (49,225,529) 4,232,348 --
------------- ------------- ------------- ------------- -------------
Net increase (decrease) ................ 13,768,188 7,208,151 (800,385) 3,455,005 159,385,514
Net assets available for benefits:
Beginning of year ............................ -- -- 154,830,929 13,181,171 446,469,503
------------- ------------- ------------- ------------- -------------
End of year .................................. $ 13,768,188 $ 7,208,151 $ 154,030,544 $ 16,636,176 $ 605,855,017
============= ============= ============= ============= =============
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
Unocal Savings Plan
Statement of Changes in Net Assets Available for Benefits with Fund Information
For the Year Ended December 31, 1995
Non-
Participant
Directed Participant Directed
---------- ----------------------------------------------------------------
Unocal Low
Common S&P 500 George Putnam Volatility Money
Stock Index Fund Fund of Boston Trust Fund Market Fund
---------- ----------------------------------------------------------------
Additions to net assets attributed to:
Investment income
Net appreciation in fair value
<S> <C> <C> <C> <C> <C>
of investments ........................... $ 16,053,836 $ 1,999,390 $ 1,405,771 $ 98,460 $ 75,366
Interest .................................... -- 160,118 130,180 21,864 16,562
Dividends ................................... 6,562,474 -- -- --
------------ ------------ ------------ ------------ ------------
Total investment income ................... 22,616,310 2,159,508 1,535,951 120,324 91,928
Contributions
Participant ..................................... -- 9,076,526 7,791,481 1,558,307 1,419,892
Company ......................................... 24,176,012 -- -- --
------------ ------------ ------------ ------------ ------------
Total contributions .......................... 24,176,012 9,076,526 7,791,481 1,558,307 1,419,892
Total additions ........................... 46,792,322 11,236,034 9,327,432 1,678,631 1,511,820
Deductions from net assets attributed to:
Participants withdrawals & distributions ........ 19,529,848 288,593 196,401 57,342 180,951
Trustee fees and other expenses ................. 81 2,838 2,302 341 563
------------ ------------ ------------ ------------ ------------
Total deductions ............................. 19,529,929 291,431 198,703 57,683 181,514
Net increase prior to interfund transfers .......... 27,262,393 10,944,603 9,128,729 1,620,948 1,330,306
Interfund transfers ................................ -- 5,075,239 3,353,533 409,074 1,553,681
------------ ------------ ------------ ------------ ------------
Net increase .............................. 27,262,393 16,019,842 12,482,262 2,030,022 2,883,987
Net assets available for benefits:
Beginning of year ............................... 217,778,897 -- -- --
------------ ------------ ------------ ------------ ------------
End of year ..................................... $245,041,290 $ 16,019,842 $ 12,482,262 $ 2,030,022 $ 2,883,987
============ ============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
Participant
Directed
---------------------------------------
Unocal
Common
Stock Other Total
------------------- ------------------ ------------------
Additions to net assets attributed to:
Investment income
Net appreciation in fair value
<S> <C> <C> <C>
of investments ....................................... $ 10,634,654 $ -- $ 30,267,477
Interest ................................................ 376,373 -- 705,097
Dividends ............................................... 4,394,120 -- 10,956,594
------------- ------------- -------------
Total investment income ............................... 15,405,147 -- 41,929,168
Contributions
Participant ................................................. 15,334,294 -- 35,180,500
Company ..................................................... -- -- 24,176,012
------------- ------------- -------------
Total contributions ...................................... 15,334,294 -- 59,356,512
Total additions ....................................... 30,739,441 -- 101,285,680
Deductions from net assets attributed to:
Participants withdrawals & distributions .................... 10,964,348 283,420 31,500,903
Trustee fees and other expenses ............................. 38,005 -- 44,130
------------- ------------- -------------
Total deductions ......................................... 11,002,353 283,420 31,545,033
Net increase prior to interfund transfers ...................... 19,737,088 (283,420) 69,740,647
Interfund transfers ............................................ (14,444,711) 4,053,184
------------- ------------- -------------
Net increase .......................................... 5,292,377 3,769,764 69,740,647
Net assets available for benefits:
Beginning of year ........................................... 149,538,552 9,411,407 376,728,856
------------- ------------- -------------
End of year ................................................. $ 154,830,929 $ 13,181,171 $ 446,469,503
============= ============= =============
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
6
<PAGE>
UNOCAL SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF THE PLAN
GENERAL
- -------
Unocal Corporation (Unocal) was incorporated in Delaware on March 18, 1983,
to operate as the parent of Union Oil Company of California. The Unocal Savings
Plan (the "Plan") provides for Union Oil Company of California d.b.a. Unocal
(the "company") contributions and for participants voluntary contributions.
Putnam Fiduciary Trust Company is the trustee ("Trustee") of the Plan and
invests funds contributed by the company and participants to the Plan. During
1996 and 1995, all company contributions were invested in common stock of Unocal
Corporation and participant contributions were invested at the discretion of the
participants in a range of investment fund options and Unocal Corporation common
stock. Effective March 3, 1997, participants may transfer company contributions
into one or more of the Plan investment options. The company will continue to
match contributions in only Unocal common stock, however, participants may
thereafter transfer these balances into any of the Plan investment options. All
shares remain with the Trustee until delivered to participants upon request for
withdrawal or after termination of employment. The Plan is subject to certain
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA") as a
defined contribution plan.
The Savings Plan - Investment Opportunities brochure dated April 1996
and the Unocal Savings Plan Preview dated February 1996 constitute part of a
prospectus covering securities that have been registered under the Securities
Act of 1933. The April 1996 brochure replaces the Savings Plan - New Investment
Opportunities brochure dated January 1, 1995. The April 1996 brochure and the
Savings Plan brochure dated March 1995 are addendums to the Unocal Profit
Sharing Plan Summary Plan Description booklet dated July 1, 1990. Other
information about the Plan can be found in the Summary Plan Description booklet
and the subsequent brochures described above.
CONTRIBUTIONS
- -------------
PARTICIPANT CONTRIBUTIONS -- Voluntary participant contributions can be all
pre-tax, all after-tax, or a combination of both. However, a participant's total
annual contribution must not exceed 15 percent of the participant's annual base
pay. The pre-tax contributions are also known as 401(k) contributions. A
participant's contributions shall not exceed the maximum amount allowed by law.
COMPANY MATCHING CONTRIBUTIONS -- The company matches employee pre-tax 401(k)
contributions on a dollar for dollar basis, up to six percent of the
contributing participant's base pay.
At its discretion, the company directs the Trustee to purchase shares
attributable to company matching contributions either on the open market or by
private purchases directly from the company.
PARTICIPANT ACCOUNTS
- --------------------
Each participant's account is credited with the contributions and the
respective net investment earnings or losses of the individual funds as governed
by the participant's investment selection.
VESTING
- -------
Participants are always 100 percent vested in participant contributions
and the dividends on those contributions. Vesting in the company contributions
portion of participant's accounts plus dividends thereon is based on years of
credited service. A participant is 100 percent vested in company contributions
after five years of credited service.
7
<PAGE>
UNOCAL SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
PAYMENT OF BENEFITS
- -------------------
On termination of employment or at such time as participants become
eligible to receive benefits, participants may elect to receive their account
balance or defer their distribution until a later date, but not beyond April 1
of the year following attainment of age 70-1/2.
If a participant continues to work past age 70-1/2, federal regulations
require distribution of a portion of the participant's account balance by April
1 of the calendar year following the participant's attainment of age 70-1/2.
ROLLOVERS INTO THE PLAN
- -----------------------
As a result of labor contract negotiations, employees of Molycorp, Inc., a
wholly owned subsidiary of Unocal, at Mountain Pass became eligible to commence
participation in the Plan and make contributions to the Plan after June 30,
1996. In October 1996, employees at Mountain Pass were extended a special
election period to rollover into the Plan account balances existing in the
Molycorp Inc. 401(k) Savings Plan prior to June 30, 1996. Consequently, account
balances totaling $614,739 were transferred in December 1996 to the Plan and are
included in participant contributions in the statement of changes in net assets
available for benefits.
In October 1996, former employees of Prairie Producing Company, a company
acquired by Unocal, were extended a special election period to rollover into the
Plan previously existing account balances in the Prairie Producing Company
Employee Benefit Plan. In December 1996, account balances totaling $933,224 were
transferred into the Plan and are included in participant contributions in the
statement of changes in net assets available for benefits.
Effective March 3, 1997, the Plan will accept rollovers of qualified
amounts from the Unocal Retirement Plan and the Unocal Employee Stock Ownership
Plan that are distributed following termination of employment. Additionally, the
Plan will accept rollovers from other employers' qualified plans, subject to
certain restrictions.
LOANS
- -----
All employees who are participants of the Plan and have a sufficient
balance in their employee pre-tax contributions account are eligible to apply
for a loan. Members borrow against their own pre-tax account balance and all
payments of principal and interest are credited back to their account. Loan
types available are "any reason" (except investment in registered securities);
"home purchase" (for purchase of a primary residence only); and loans "forced"
by a hardship withdrawal request. Repayment periods range from 1 to 15 years
depending on the type of loan. The Unocal Savings Plan Loan and Hardship
Withdrawal Committee determines the interest rate for loans based on appropriate
market rates and applicable federal regulations.
INVESTMENT PROGRAM
- ------------------
All contributions are held in trust and invested by the Trustee in
accordance with the option or options elected by the participant. A
participant's account may be invested in any one or more or all of the following
funds administrated by the Trustee:
UNOCAL CORPORATION COMMON STOCK - Monies are used to purchase shares of Unocal
Corporation common stock. During 1996 and 1995, company contributions could be
invested only in Unocal Corporation common stock. Effective March 3, 1997,
participants may transfer company contributions into one or more of the Plan
investment options. The company will continue to match contributions in only
Unocal common stock, however, participants may thereafter transfer these
balances into any of the Plan investment options.
8
<PAGE>
UNOCAL SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (continued)
PUTNAM S&P 500 - This fund invests in a large variety of publicly traded common
stock. The fund is designed to mirror the performance and composition of the
Standard & Poor's 500 index.
THE GEORGE PUTNAM FUND OF BOSTON - The monies in this fund are invested in a
diversified group of stocks and bonds.
PUTNAM LOW VOLATILITY TRUST FUND - Monies are invested mainly in U.S. government
debt securities.
PUTNAM MONEY MARKET FUND - Investments are made in a diversified portfolio of
high-quality money market instruments with an average maturity of less than 90
days.
PUTNAM NEW OPPORTUNITIES FUND - Investments are primarily in common stocks of
companies within certain emerging industry groups that offer above average
potential for growth.
PUTNAM VOYAGER FUND - Investments are in a combination of stocks of smaller
companies expected to grow over time, as well as stocks of larger, more
established companies.
Effective during 1996, participants became eligible to transfer pre-tax and
after-tax balances into any of the investment alternatives.
FEDERAL INCOME TAX STATUS
- -------------------------
The company obtained its latest determination letter on November 30,
1995, from the Los Angeles District Director of the Internal Revenue Service, in
which the Internal Revenue Service stated that the Plan, as then designed, was
in compliance with the applicable requirements of the Internal Revenue Code. The
Plan has been amended since receiving the determination letter. However, the
plan administrator and the Plan's tax counsel believe that the Plan is currently
designed and being operated in compliance with the applicable requirements of
the Internal Revenue Code. Therefore, no provision for income taxes has been
included in the Plan's financial statements.
Under Federal regulations effective January 1, 1997, the maximum employee
pay eligible for benefit purposes under a qualified plan is $160,000 per year.
If an employees' pay exceeds $160,000, only the first $160,000 of base pay will
be eligible for calculating employee and company contributions.
Federal regulations place an annual dollar limit on the amount of employee
pre-tax contributions. In 1996 and 1995 the limit was $9,500 and $9,250,
respectively. If pre-tax contributions reach the annual limit before year-end,
they are suspended for the balance of the year. The company matching
contributions are also suspended if the annual limit is reached before year-end.
Withdrawals from the Plan are generally subject to federal income tax.
Also, in-service withdrawals and withdrawals following termination of employment
prior to retirement may be subject to a 10 percent federal income tax penalty.
PLAN TERMINATION
- ----------------
The company expects to continue the Plan indefinitely, but, as future
conditions cannot be foreseen, the company may at any time or from time to time
amend or terminate the Plan in whole or part. An amendment may affect present as
well as future participants, but may not diminish the account balance of any
participant existing on the effective date of such amendment. The company has no
present intent to discontinue the company matching contributions or to terminate
the Plan.
9
<PAGE>
UNOCAL SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
- -------------------
The accompanying financial statements are prepared on the accrual basis of
accounting in conformity with generally accepted accounting principles. In
addition, the following accounting policies are applied:
a. Purchases and sales of Unocal Corporation common stock:
During normal trading by participants, the Trustee will collect
all participant directed stock trades throughout the day and will
execute and complete one buy and sell trade per day.
During abnormal conditions or heavy trading by participants, the
Trustee may not be able to execute and complete participant
directed trades on the same day without affecting the share
price. The Trustee is authorized, at its discretion, to buy or
sell a portion of the trades during the next day or days. Prices
received from each day's trading will be averaged to ensure that
all participants requesting trades will be treated equitably.
b. Dividend income is recorded on the ex-dividend date.
c. Interest income is recorded as earned on the accrual basis.
d. Substantially all of the administrative and other costs of the
Plan are paid by the company.
The Plan presents in the statement of changes in net assets available for
benefits the net appreciation (depreciation) in the fair value of its
investments which consists of the realized gains or losses and the unrealized
appreciation (depreciation) on those investments.
VALUATION OF INVESTMENTS
- ------------------------
The Plan's investments are stated at fair value. Shares of registered
investment companies are valued at quoted market prices from national exchanges
which represent the new asset value of shares held by the Plan at year-end. The
Unocal Corporation common stock is valued at the closing price as reported for
the New York Stock Exchange Composite Transactions at December 31, 1996 and
1995. The assets of the Plan are primarily invested in Unocal common stock and
in the shares of publicly traded registered investment companies (mutual funds).
As a result, the value of the assets of the Plan are subject to the variations
in the market. The fair value of the investments and net assets available for
benefits could be materially affected by a change in market conditions.
USE OF ESTIMATES IN PREPARATION OF THE FINANCIAL STATEMENTS
- -----------------------------------------------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan's management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the dates of the financial
statements and the reported amounts of additions to and deductions from net
assets during the reporting periods. Actual results could differ from those
estimates.
NOTE 3 - FORFEITURES BY MEMBERS
At December 31, 1996 and 1995, forfeited nonvested accounts totaled
$628,608 and $336,098, respectively.
10
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Committee appointed by the Board of Directors of the Company to administer the
Plan have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
UNOCAL SAVINGS PLAN
(Name of the Plan)
Date June 30, 1997 By: /s/ JOSEPH A. HOUSEHOLDER
-------------------------
Joseph A. Householder
Vice President, Tax and Comptroller
11
<PAGE>
<TABLE>
<CAPTION>
UNOCAL SAVINGS PLAN
ITEM 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
For the Year Ended DECEMBER 31, 1996
(c) Description of Investment
Including Maturity Date,
(b) Identity of Issue, Borrower, Rate of Interest, Collateral, (e)Current
(a) Lessor or Similar Party Par or Maturity Value (d) Cost Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
** Unocal Corporation Unocal Corporation Common Stock $272,006,116 $483,825,993
(11,909,563 shares)
* Putnam Investments S & P 500 Index Fund 32,511,433 39,659,989
(2,331,569 shares)
* Putnam Investments George Putnam Fund of Boston 27,455,026 28,940,379
(1,764,657 shares)
* Putnam Investments Putnam Low Volatility Trust Fund 4,055,330 4,240,936
(373,980 shares)
* Putnam Investments Putnam Money Market Fund 12,007,374 12,007,378
(12,007,378 shares)
* Putnam Investments Putnam New Opportunities Fund 14,110,056 13,768,188
(338,868 shares)
* Putnam Investments Putnam Voyager Fund 7,495,866 7,208,151
(447,156 shares)
* Putnam Investments Participant Loans -- 16,636,176
------------ ------------
$369,641,201 $606,287,190
============ ============
<FN>
* Trustee for the Plan and, therefore a party-in-interest for which a
statutory exemption exists.
** Sponser and employer, and therefore, a party-in-interest for which a
statutory exemption exists.
</FN>
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
UNOCAL SAVINGS PLAN
ITEM 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS (1)
FOR THE YEAR ENDED DECEMBER 31, 1996
(b)Description (f)Expense (h)Current
of Assets Incurred Value of (i)Net
(Including Interest (c)Purchase (d)Selling (e)Lease With (g) Cost Asset on Gain
(a)Identity of Rate and Maturity Price Price Rental Transaction of Asset Transaction Or
Party Involved in Case of a loan) Date (loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Unocal Corporation Unocal Corporation 51,398,812 51,398,812 51,398,812
(2) Common Stock
(286 Transactions)
Unocal Corporation Unocal Corporation 111,132,633 74,200,354 111,132,633 36,932,279
(2) Common Stock
(1,546 transactions)
Putnam Investments George Putnam 22,436,274 22,436,274 22,436,274
(3) Fund (361 transactions)
Putnam Investments George Putnam 7,107,966 6,771,653 7,107,966 336,313
(3) Fund (578 transactions)
Putnam Investments Putnam Voyager Fund 8,500,780 8,500,780 8,500,780
(3) (247 transactions)
Putnam Investments Putnam Voyager Fund 1,017,788 1,004,915 1,017,786 12,871
(3) (216 transactions)
Putnam Investments Putnam New 16,496,947 16,496,947 16,496,947
(3) Opportunity Fund
(255 transactions)
Putnam Investments Putnam New 2,378,771 2,386,891 2,378,771 (8,120)
(3) Opportunity Fund
(244 transactions)
Putnam Investments Putnam S&P 500 27,333,133 27,333,133 27,333,133
(3) Fund (247 transactions)
Putnam Investments Putnam S&P 500 10,100,706 8,955,626 10,100,706 1,145,080
(3) Fund (582 transactions)
Putnam Investments Putnam Low 3,640,603 3,640,603 3,640,603
(3) Volatility Fund
(257 transactions)
Putnam Investments Putnam Low 1,560,145 1,523,062 1,560,145 37,083
(3) Volatility Fund
(414 transactions)
Putnam Investments Putnam Money 1,586,627 1,586,627 1,586,627
(3) Market Fund
(520 transactions)
Putnam Investments Putnam Money 8,295,000 8,295,004 8,295,000 (4)
(3) Market Fund
(448 transactions)
<FN>
(1) Under ERISA, a reportable transaction is a transaction or series of
transactions during the Plan year that involves more than 5 percent of the
fair value of the Plan assets at the beginning of the Plan year, with
certain exceptions.
(2) Trustree for the Plan and, therefore a party-in-interest for which a
statutory exemption exists.
(3) Sponsor and employer and, therefore a party-in-interest for which a
statutory exemption exists.
</FN>
</TABLE>
13
<PAGE>
UNOCAL CORPORATION
EXHIBIT INDEX
Exhibit 23 Consent of Coopers & Lybrand L.L.P.
14
<PAGE>
EXHIBIT 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement of
Unocal Corporation on Form S-8 (No. 33-65461) of our report, dated June 23,
1996, on our audits of the financial statements and supplemental schedules of
the Unocal Savings Plan as of December 31, 1996 and 1995 and for the years then
ended which report is included in this annual report on Form 11-K.
Coopers & Lybrand L. L. P.
Los Angeles, California
June 30, 1997
