SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
FORM 11-K
ANNUAL REPORT
/x/ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED]
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
or
|_| TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ______________ to ______________
COMMISSION FILE NUMBER 1-13632
A. Full Name of the Plan: THE CIRCLE K KASH PLUS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
TOSCO CORPORATION
72 CUMMINGS POINT ROAD
STAMFORD, CONNECTICUT 06902
<PAGE>
THE CIRCLE K KASH PLUS PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
AS OF DECEMBER 31, 1996 AND 1995 AND
FOR THE YEAR ENDED DECEMBER 31, 1996
<PAGE>
THE CIRCLE K KASH PLUS PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
PAGE(S)
Report of Independent Accountants 1
Financial Statements:
Statement of Net Assets Available for Benefits with Fund
Information as of December 31, 1996 2
Statement of Net Assets Available for Benefits with Fund
Information as of December 31, 1995 3
Statement of Changes in Net Assets Available for Benefits
with Fund Information for the year ended December 31, 1996 4
Notes to Financial Statements 5 - 8
Supplemental Schedules:
Item 27(a) - Schedule of Assets Held for Investment
Purposes as of December 31, 1996 9
Item 27(d) - Schedule of Reportable (5%) Transactions
for the year ended December 31, 1996 10
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees
The Circle K Kash Plus Plan
We have audited the accompanying statements of net assets available for benefits
of The Circle K Kash Plus Plan (the "Plan") as of December 31, 1996 and 1995,
and the related statement of changes in net assets available for benefits for
the year ended December 31, 1996. 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 have 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 aspects, 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 year ended December 31, 1996 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 as of December 31, 1996, and of reportable (5%)
transactions for the year ended December 31, 1996, 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 statement of changes in net assets
available for benefits is presented for purposes of additional analysis rather
than to present the net assets available for benefits and changes in net
assets available for 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.
Phoenix, Arizona
July 14, 1997
<PAGE>
The Circle K Kash Plus Plan
Statement of Net Assets Available for Benefits with Fund Information
December 31, 1996
<TABLE>
<CAPTION>
Participant Directed
Stable Value Balanced Equity Global Stock Loan
Fund Fund Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
At fair value:
Mutual funds $ 21,392,824 $8,384,047 $7,425,966 $3,235,861 $ - $ - $40,438,698
Common stock 562,953 562,953
Loans to participants 2,211,064 2,211,064
------------- ------------ ----------- ----------- --------- ------------ -----------
Total investments 21,392,824 8,384,047 7,425,966 3,235,861 562,953 2,211,064 43,212,715
------------- ------------ ----------- ----------- --------- ------------ -----------
Receivables:
Employer's contribution 20,404 11,132 9,171 6,304 47,011
Participants' contributions 58,404 33,350 28,540 18,860 139,154
Interest 22,503 1,218 23,721
------------- ------------ ------------ ---------- ---------- ------------- ------------
Total receivables 101,311 44,482 37,711 25,164 1,218 - 209,886
------------- ------------ ------------ ---------- ---------- ------------- ------------
Cash 135,902 35,157 60,980 16,577 3,003 251,619
------------- ----------- ------------ ---------- ---------- ------------- ------------
Net assets available for benefits $21,630,037 $8,463,686 $7,524,657 $3,277,602 $567,174 $2,211,064 $43,674,220
=========== ========== ============ =========== ========== ============= ============
The accompanying notes are an integral part of these financial statements.
</TABLE>
The Circle K Kash Plus Plan
Statement of Net Assets Available for Benefits with Fund Information
December 31, 1995
<TABLE>
<CAPTION>
Participant Directed
Stable Value Balanced Equity Global Stock Loan
Fund Fund Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
At fair value:
Mutual funds $ - $6,601,899 $ - $ 2,274,473 $- $ - $8,876,372
Common stock 4,403,353 314,240 4,717,593
Loans to participants 1,816,803 1,816,803
At contract value:
Guaranteed investment contracts 22,054,473 22,054,473
------------- ------------ ------------ ----------- --------- --------- -------------
Total investments 22,054,473 6,601,899 4,403,353 2,274,473 314,240 1,816,803 37,465,241
------------- ------------ ------------ ---------- --------- ---------- -------------
Receivables:
Employer's contribution 9,911 4,749 3,097 2,271 619 20,647
Participants' contributions 31,804 15,240 9,939 7,288 1,988 66,259
Interest 24,081 9,370 33,451
------------- ------------ ----------- ----------- -------- ----------- -----------
Total receivables 65,796 19,989 22,406 9,559 2,607 - 120,357
------------- ------------ ----------- ----------- -------- ----------- ----------
Cash 108,195 527,200 33,301 55,270 723,966
------------- ------------ ----------- ----------- -------- ----------- ----------
Total assets 22,120,269 6,730,083 4,952,959 2,317,333 372,117 1,816,803 38,309,564
------------- ------------ ----------- ----------- -------- ----------- -----------
LIABILITIES
Forfeitures payable to plan sponsor 49,692 15,119 11,127 5,206 835 81,979
Other payables 11,620 11,620
------------- ------------ ----------- ----------- --------- ----------- -----------
Total liabilities 61,312 15,119 11,127 5,206 835 - 93,599
------------- ------------ ----------- ----------- --------- ---------- -----------
Net assets available for benefits $22,058,957 $6,714,964 $4,941,832 $2,312,127 $371,282 $1,816,803 $38,215,965
============= ============ =========== =========== ========== ============ ============
The accompanying notes are an integral part of these financial statements.
</TABLE>
The Circle K Kash Plus Plan
Statement of Changes in Net Assets Available for Benefits with Fund Information
Year Ended December 31, 1996
<TABLE>
<CAPTION>
Participant Directed
Stable Value Balanced Equity Global Stock Loan
Fund Fund Fund Fund Fund Fund Total
<S> <C> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Investment income:
Net investment gain from mutual funds $ - $1,109,271 $ - $ 457,820 $ - $ - $ 1,567,091
Net appreciation in fair value of
investments 902,571 276,808 1,179,379
Interest and dividends 1,283,634 18,399 423,504 6,981 5,179 71,549 1,809,246
------------ ---------- --------- --------- ------- --------- ---------
Total investment income 1,283,634 1,127,670 1,326,075 464,801 281,987 71,549 4,555,716
------------ ---------- ---------- --------- ------- --------- ---------
Contributions:
Employer 758,098 371,999 262,713 190,338 5,611 1,588,759
Participants 2,186,344 1,163,496 855,727 600,189 16,624 4,822,380
Rollovers 13,511 52,575 77,045 52,671 9,931 205,733
------------ ----------- --------- ---------- ------- --------- ---------
Total contributions 2,957,953 1,588,070 1,195,485 843,198 32,166 - 6,616,872
------------ ----------- --------- ---------- ------- ---------- --------
Total additions 4,241,587 2,715,740 2,521,560 1,307,999 314,153 71,549 11,172,588
------------ ----------- ---------- ----------- -------- --------- ----------
Deductions from net assets attributed to:
Benefits paid to participants 3,501,258 964,612 615,480 300,844 23,223 229,863 5,635,280
Forfeitures 79,053 79,053
------------- ---------- ---------- ----------- -------- --------- ---------
Total deductions 3,580,311 964,612 615,480 300,844 23,223 229,863 5,714,333
------------- ---------- ---------- ----------- -------- --------- ---------
Net increase (decrease) before
interfund transfers 661,276 1,751,128 1,906,080 1,007,155 290,930 (158,314) 5,458,255
Interfund transfers (1,090,196) (2,406) 676,745 (41,680) (95,038) 552,575 -
-------------- ---------- ----------- ----------- --------- ---------- ---------
Net increase (decrease) (428,920) 1,748,722 2,582,825 965,475 195,892 394,261 5,458,255
Net assets available for benefits,
beginning of year 22,058,957 6,714,964 4,941,832 2,312,127 371,282 1,816,803 38,215,965
--------------- ----------- ----------- ----------- -------- --------- ----------
Net assets available for benefits,
end of year $21,630,037 $8,463,686 $7,524,657 $3,277,602 $567,174 $2,211,064 $43,674,220
=============== =========== =========== ========== ========= ========== ===========
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
THE CIRCLE K KASH PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN
The following description of The Circle K Kash Plus Plan (the "Plan") provides
only general information. Participants should refer to the Plan Document for a
more complete description of the Plan's provisions.
GENERAL
The Plan, established in 1985, and amended and restated at various times,
is a defined contribution, 401(k) profit sharing plan, covering substantially
all of the full-time employees of Tosco Marketing Company, formerly Circle K
Stores, Inc. (the "Sponsor") who have reached the age of 21 and completed one
continuous year of employment with the Sponsor. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA") and
the Internal Revenue Code as amended by the Tax Reform Act of 1986 and
subsequent legislation. Effective April 1, 1996, the Plan is being administered
by Merrill Lynch Trust Company ("Merrill Lynch"), who is also maintaining the
individual participant account records and serving as custodian for the Plan's
investments.
CONTRIBUTIONS
Participants may contribute between 1 and 12 percent of their compensation to
the Plan. The Sponsor contributes an amount equal to 50 percent of the first 4
percent of the participant's contribution for each payroll period. Participant
investment choice dictates the allocation of the Sponsor's matching
contribution. Earnings on investments held by the Plan in the name of a
participant are automatically invested in the respective fund from which the
earnings were derived.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contribution and
allocations of the Sponsor's contribution and, Plan earnings, and charged with
an allocation of investment expenses. Allocations are based on participant
earnings or account balances, as defined. The benefit to which a participant is
entitled is the benefit that can be provided from the participant's vested
account.
VESTING
Participant contributions to the Plan, as well as the investment earnings
thereon, are fully vested. Vesting on the Sponsor's matching and discretionary
contribution portion of their accounts plus actual earnings thereon is based on
years of continuous service. A participant is 100% vested after five years of
credited service.
PARTICIPANT LOANS
The Plan, with certain limitations, may make loans to participants with an
interest rate equal to the prime interest rate on the origination date. A loan
from the Plan will be made for up to 50% of the participants account balance and
all interest payments made under the terms of the loan will be credited to the
participant's account and not considered general earnings of the Plan.
Participants' loans are repaid through payroll deductions. The participant loans
are collateralized by the participants' vested account balances. The maturity on
these loans is not to exceed five years.
DISTRIBUTIONS
Benefits of the Plan are payable upon reaching normal retirement, early
retirement, termination, or in the event of death or disability. All
distributions from the Plan are made in one lump sum. Any whole shares of stock
in a participant's stock fund account will be distributed in the form of shares
of stock. All other amounts, including fractional shares of stock, will be
distributed to the participant in cash.
FORFEITURES
Under the terms of the Plan Agreement, nonvested employer contributions revert
back to the Sponsor after a participant has terminated employment.
ADMINISTRATION FEES
All Plan investment management fees are paid from the investment earnings of the
individual investment funds and all other administration fees are paid by the
Sponsor from the available forfeitures of terminated, non-vested participants.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Sponsor has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event the Plan is terminated by
the Sponsor, participants will become fully vested for Sponsor contributions in
their accounts.
2. SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Plan's financial statements are presented on the accrual basis of
accounting.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, the
reported changes in net assets available for benefits and disclosure of
contingent assets and liabilities. Actual results could differ from those
estimates.
INVESTMENTS
The Plan's investments are stated at fair value except for its investments in
Guaranteed Investment Contracts ("GICs") which are stated at contract value,
which approximates fair value. Common stock and mutual fund securities are
valued at their quoted market price. The Plan presents, in the statement of
changes in net assets, the net appreciation (depreciation) in the fair value of
its investments which consists of the realized gains or losses and the
unrealized appreciation (depreciation) of those investments.
3. ACQUISITION
On May 30, 1996, the Tosco Corporation ("Tosco") completed its acquisition of
The Circle K Corporation ("Circle K"). Subsequent to this acquisition, Tosco
elected to continue operating the Sponsor as a distinct operating subsidiary
without modifying the Plan in any significant manner.
4. INVESTMENTS
Participants may designate, in one percent increments, the portion of his or her
contribution to be placed in various funds. Loan repayments are allocated to
these funds based on the participant's current contribution designation. The
characteristics of the different funds as follows:
STABLE VALUE FUND
The stable value fund seeks to provide preservation of participants'
investments, liquidity, and current income that is typically higher than money
market funds. Investments are held in a pooled separate account maintained by
Merrill Lynch that invests in a broadly-diversified portfolio of GICs, U.S.
government obligations, U.S. government agency securities, and high-quality
money market securities. Prior to March 31, 1996, investments were made in
specific GICs recommend by the Board of Trustees. At December 31, 1996, the
aggregate interest rate of the GICs was 6.5%.
BALANCED FUND
The balanced fund seeks to provide current income and, secondarily, growth of
capital. Investments are in the Income Fund of America mutual fund. This mutual
fund invests in equities, bonds, and other fixed-income securities in any
proportion that seems warranted by existing or expected market conditions.
EQUITY FUND
The equity fund seeks growth of capital. Investments are in the Davis New York
Venture mutual fund. This mutual fund invests primarily in equity securities of
companies with market capitalization in excess of $250 million. Prior to March
31, 1996, investments were made in a portfolio of common stocks recommended by
the Board of Trustees.
GLOBAL FUND
The global fund seeks to provide long-term growth of capital through investments
in all over the world, including the United States. Investments are made in the
New Perspective mutual fund. This mutual fund invests in U.S. and foreign blue
chip companies, focusing on opportunities generated by changes in global trade
patterns and economic and political relationships.
STOCK FUND
The stock fund was established to allow participants to purchase Circle K common
stock. On February 16, 1996, the stock fund was closed to additional
contributions and participants were allowed to maintain their existing balance
in the stock fund or transfer their stock fund balance into any other investment
fund. In conjunction with the Tosco acquisition (Note 3), 13,340 shares of
Circle K common stock were exchanged for 8,220 shares of Tosco common stock. At
December 31, 1996 the stock fund held 7,115 share of Tosco common stock.
LOAN FUND
The loan fund represents amounts borrowed by participants against their
individual accounts. All loans are collaterallized by the vested portion of the
participants' plan balance.
<PAGE>
As of December 31, 1996 and 1995, the Plan investments were as follows:
<TABLE>
<CAPTION>
1996 1995
-------------- -----------
<S> <C> <C>
Investments at fair value:
Circle K Stable Value Fund (a) $ 21,379,345 $
Wells Fargo Stable Assets Fund 13,479
First Interstate Bank of North America GIC (b) 9,921,911
Merrill Lynch Retirement Preservation Trust GIC (b) 8,409,838
Aetna Life Insurance Company GIC (b) 3,722,724
------------ -----------
Stable Value Fund 21,392,824 22,054,473
------------ -----------
Balanced Fund - Income Fund of America (a) (b) 8,384,047 6,601,899
------------ -----------
Davis New York Venture Fund (a) 7,425,966
Common Stocks 4,403,353
------------ -----------
Equity Fund 7,425,966 4,403,353
------------ -----------
Global Funds - New Perspective Fund (a) (b) 3,235,861 2,274,473
----------- -----------
Tosco Common Stock 562,953
Circle K Common Stock 314,240
------------ -----------
Stock Fund 562,953 314,240
------------- -----------
Loans to participants (a) 2,211,064 1,816,803
----------------- ------------------
Total investments $ 43,212,715 $ 37,465,241
================= ==================
(a) This investment represents more than 5% of the Plan's net assets
available for benefits as of December 31, 1996.
(b) This investment represents more than 5% of the Plan's net assets
available for benefits as of December 31, 1995.
</TABLE>
5. FEDERAL INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Sponsor by a letter
dated April 15, 1996, that the Plan and related trust are designed in accordance
with applicable sections of the Internal Revenue Code (IRC). Although the Plan
amendment allowing Tosco common stock as an investment fund was not in place
when the foregoing determination letter was sought, management, Merrill Lynch,
and the Plan's tax counsel believe that the Plan is designed and is currently
being operated in compliance with the applicable requirements of the IRC.
6. PARTY IN INTEREST TRANSACTIONS
The forfeitures payable to plan sponsor as of December 31, 1995 consists of
forfeited nonvested employer contributions. At December 31, 1996, all
forfeitures have been excluded from the Plan's net assets available for
benefits.
During 1996, administrative expenses related to the Plan totaling $145,335 were
paid by the Sponsor from available forfeitures.
The Circle K Kash Plus Plan
Item 27(a) - Schedule of Assets Held For Investment Purposes
December 31, 1996
<TABLE>
<CAPTION>
Current
Identity of Issue, Description of Investment Cost Value
Borrower, Lessor or
Similar Party
<S> <C> <C> <C>
* Merrill Lynch - Circle K Stable Value Fund 21,379,345 shares $21,379,345 $21,379,345
Wells Fargo - Stable Assets Fund 13,479 shares 13,479 13,479
American Funds-Income Fund of America 507,509 shares 8,243,569 8,384,047
Davis Funds - Davis New York Venture Fund 424,341 shares 6,732,253 7,425,966
American Funds New Perspective Fund 178,088 shares 3,086,940 3,235,861
* Tosco Corporation - Common Stock 7,115 shares 269,382 562,953
Participants Loans Receivable Interest rates from 6.0% 2,211,064
to 10.1% and maturities ------------
through December 2001 $43,212,715
============
* Investment qualifies as a party-in-interest for the Plan.
</TABLE>
The Circle K Kash Plus Plan
Item 27(d) - Schedule of Reportable (5%) Transactions
Year Ended December 31, 1996
<TABLE>
<CAPTION>
PUCHASES
Number of Purchase
Identity of Party Involved Description of Asset Transactions Price
<S> <C> <C> <C>
Merrill Lynch Circle K Stable Value Fund 400 $25,016,401
American Funds Income Fund of America 295 9,615,342
Davis Funds Davis New York Venture Fund 295 7,446,346
American Funds New Perspective Fund 254 3,791,157
Wells Fargo Stable Assets Fund 4 2,128,389
Bank One The One Group Money Market Fund 92 14,995,746
SALES
Number of Selling Cost of Net Gain
Identity of Party Involved Description of Asset Transactions Price Asset or (Loss)
<S> <C> <C> <C> <C> <C>
Merrill Lynch Circle K Stable Value Fund 292 $3,563,800 $3,563,800 $-
Wells Fargo Guaranteed Investment Contract 2 3,114,202 3,114,202 -
Wells Fargo Pacifica Money Market Trust Fund 2 3,114,202 3,114,202 -
Wells Fargo Stable Assets Fund 4 9,434,482 9,434,482 -
Aetna Life Insurance Company Guaranteed Investment Contract 1 3,735,576 3,735,576 -
Bank One The One Group Money Market Fund 30 15,902,586 15,902,586 -
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned hereunto
duly authorized.
TOSCO CORPORATION
The Circle K Kash Plus Plan
Date: July 14, 1997 By: /S/ WANDA WILLIAMS
--------------------------
Wanda Williams
Vice President - Human Resources
By: /S/ RANDALL S. SCHULTZ
--------------------------
Randall S. Schultz
Plan Administrator
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
The Tosco Corporation on Form S-8 (File No. ) of our report dated July ___1997,
on our audits of the financial statements and financial statement schedules of
The Circle K Kash Plus Plan as of December 31, 1996 and 1995 and for the year
ended December 31, 1996, which report is included in this Annual Report on Form
11-K.
COOPERS & LYBRAND L.L.P.
Phoenix, Arizona
July ___, 1997
