FORM 10-K/A
Amendment No. 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1994
----------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
--------------- ----------------
Commission file number 1-720
-------------------------------------------
Phillips Petroleum Company
(Exact name of registrant as specified in its charter)
Delaware 73-0400345
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Phillips Building, Bartlesville, Oklahoma 74004
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 918-661-6600
- -----------------------------------------------------------------
Filing Additional Exhibits
<PAGE>
Item 14 - Exhibits
- ------------------
The registrant is filing with this Amendment No. 1 Annual Reports
on Form 11-K for the Thrift Plan of Phillips Petroleum Company,
the Long-Term Stock Savings Plan of Phillips Petroleum Company
and the Retirement Savings Plan of Phillips Petroleum Company.
1
<PAGE>
PHILLIPS PETROLEUM COMPANY
INDEX TO EXHIBITS
Exhibit
Number Description
- ------- -----------
3(I) Restated Certificate of Incorporation, as filed with
the State of Delaware July 17, 1989 (incorporated by
reference to Exhibit 4(a) to Quarterly Report on Form
10-Q for the quarter ended June 30, 1989).
(ii) Bylaws of Phillips Petroleum Company, as amended
effective February 13, 1995.*
4(a) Indenture dated as of September 15, 1990, between
Phillips Petroleum Company and Bank of America
Illinois (formerly Continental Bank, National
Association), relating to the 9 1/2% Notes due 1997
and the 9 3/8% Notes due 2011 (incorporated by
reference to Exhibit 4(c) to Annual Report on
Form 10-K for the year ended December 31, 1990).
(b) Indenture dated as of September 15, 1990, as
supplemented by Supplemental Indenture No. 1 dated
May 23, 1991, between Phillips Petroleum Company and
Bank of America Illinois (formerly Continental Bank,
National Association), relating to the 9.18% Notes
due September 15, 2021, the 9% Notes due 2001, the
8.86% Notes due May 15, 2022, the 8.49% Notes due
January 1, 2023, the 7.92% Notes due April 15, 2023,
the 7.20% Notes due November 1, 2023 and the 6.65%
Notes due March 1, 2003 (incorporated by reference to
Exhibit 4(d) to Annual Report on Form 10-K for the
year ended December 31, 1991).
(c) Preferred Share Purchase Rights as described in the
Rights Agreement dated as of July 10, 1989, between
Phillips Petroleum Company and Chemical Bank
(formerly Manufacturers Hanover Trust Company)
(incorporated by reference to Exhibit 1 to Current
Report on Form 8-K dated July 10, 1989).
(d) Amendment dated May 16, 1990, to the Rights Agreement
dated July 10, 1989, between Phillips Petroleum
Company and Chemical Bank (formerly Manufacturers
Hanover Trust Company) (incorporated by reference to
Exhibit 1 to Current Report on Form 8-K dated May 16,
1990).
The company incurred during 1994 certain long-term
debt not registered pursuant to the Securities
Exchange Act of 1934. No instrument with respect to
such debt is being filed since the total amount of
the securities authorized under any such instrument
2
<PAGE>
PHILLIPS PETROLEUM COMPANY
INDEX TO EXHIBITS
(Continued)
Exhibit
Number Description
- ------- -----------
did not exceed 10 percent of the total assets of the
company on a consolidated basis. The company hereby
agrees to furnish to the Securities and Exchange
Commission upon its request a copy of such instrument
defining the rights of the holders of such debt.
10(a) Agreement dated December 23, 1984, among Mesa Partners
and related entities and Phillips Petroleum Company
and the schedules, annexes and exhibit thereto
(incorporated by reference to Exhibit 10(a) to Annual
Report on Form 10-K for the year ended December 31,
1989).
(b) Letter Agreement dated December 23, 1984, among Mesa
Partners and related entities and Phillips Petroleum
Company (incorporated by reference to Exhibit 10(b)
to Annual Report on Form 10-K for the year ended
December 31, 1989).
(c) Deferred Compensation Plan for Non-Employee Directors
of Phillips Petroleum Company (incorporated by
reference to Exhibit 10(d) to Annual Report on Form
10-K for the year ended December 31, 1990).
(d) 1986 Stock Plan of Phillips Petroleum Company
(incorporated by reference to Exhibit 10(d) to Annual
Report on Form 10-K for the year ended December 31,
1992).
(e) 1990 Stock Plan of Phillips Petroleum Company
(incorporated by reference to Exhibit 10(f) to Annual
Report on Form 10-K for the year ended December 31,
1989).
(f) Annual Incentive Compensation Plan of Phillips
Petroleum Company (incorporated by reference to
Exhibit 10(f) to Annual Report on Form 10-K for the
year ended December 31, 1992).
(g) Incentive Compensation Plan of Phillips Petroleum
Company.*
(h) Principal Corporate Officers Supplemental Retirement
Plan of Phillips Petroleum Company (incorporated by
reference to Exhibit 10(h) to Annual Report on Form
10-K for the year ended December 31, 1989).
3
<PAGE>
PHILLIPS PETROLEUM COMPANY
INDEX TO EXHIBITS
(Continued)
Exhibit
Number Description
- ------- -----------
10(i) Phillips Petroleum Company Supplemental Executive
Retirement Plan (incorporated by reference to Exhibit
10(i) to Annual Report on Form 10-K for year ended
December 31, 1993).
(j) Key Employee Deferred Compensation Plan of Phillips
Petroleum Company.*
(k) Non-Employee Director Retirement Plan of Phillips
Petroleum Company (incorporated by reference to
Exhibit 10(k) to Annual Report on Form 10-K for the
year ended December 31, 1992).
(l) Omnibus Securities Plan of Phillips Petroleum Company
(incorporated by reference to Exhibit 10 to Quarterly
Report on Form 10-Q for the quarter ended June 30,
1993).
12 Computation of Ratio of Earnings to Fixed Charges.*
21 List of Subsidiaries of Phillips Petroleum Company.*
23 Consent of Independent Auditors.*
27 Financial Data Schedule.*
99(a) Form 11-K, Annual Report, of the Thrift Plan of
Phillips Petroleum Company for the fiscal year ended
December 31, 1994.
(b) Form 11-K, Annual Report, of the Long-Term Stock
Savings Plan of Phillips Petroleum Company for the
fiscal year ended December 31, 1994.
(c) Form 11-K, Annual Report, of the Retirement Savings
Plan of Phillips Petroleum Company for the fiscal
year ended December 31, 1994.
*Filed with the original Annual Report on Form 10-K for year
ended December 31, 1994.
Copies of the exhibits listed in this Index to Exhibits are
available upon request for a fee of $3.00 per document. Such
request should be addressed to:
Secretary
Phillips Petroleum Company
1234 Adams Building
Bartlesville, OK 74004
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this amendment to be signed
on its behalf by the undersigned thereunto duly authorized.
PHILLIPS PETROLEUM COMPANY
/s/ L. F. Francis
----------------------------------
L. F. Francis
Controller and General Tax Officer
June 27, 1995
5
<PAGE>
Exhibit 99(a)
FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the year ended December 31, 1994
------------------------------------
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 33-50134
--------------------------------
THRIFT PLAN OF PHILLIPS PETROLEUM COMPANY
(Full title of the Plan)
PHILLIPS PETROLEUM COMPANY
(Name of issuer of securities)
Bartlesville, Oklahoma 74004
(Address of principal executive office) (Zip code)
<PAGE>
FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
--------------------
Financial statements of the Thrift Plan of Phillips Petroleum
Company, filed as a part of this annual report, are listed in the
accompanying index.
(b) Exhibits
--------
Exhibit 1 Consent of Ernst & Young LLP
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Thrift Plan Committee has duly caused this annual
report to be signed on its behalf by the undersigned hereunto
duly authorized.
THRIFT PLAN OF
PHILLIPS PETROLEUM COMPANY
/s/ L. F. Francis
---------------------------------
L. F. Francis
Member
Thrift Plan Committee
June 27, 1995
1
<PAGE>
- -----------------------------------------------------------------
Index To Financial Statements Thrift Plan Of Phillips
And Schedules Petroleum Company
Page
Report of Independent Auditors .............................. 4
Financial Statements
Statements of Net Assets Available for Benefits
at December 31, 1994 and 1993
Total Plan ............................................. 5
Fund A ................................................. 7
Combined Funds B and C ................................. 9
Fund D--Deposit Administration Account ................. 11
Fund D--Deferred Settlement Account .................... 13
Fund E ................................................. 15
Fund F ................................................. 17
Loan Fund .............................................. 19
Temporary Investment Fund .............................. 21
Statements of Changes in Net Assets Available for Benefits
for the Years Ended December 31, 1994, 1993 and 1992
Total Plan ............................................. 6
Fund A ................................................. 8
Combined Funds B and C ................................. 10
Fund D--Deposit Administration Account ................. 12
Fund D--Deferred Settlement Account .................... 14
Fund E ................................................. 16
Temporary Investment Fund............................... 22
Statements of Changes in Net Assets Available for Benefits
for the Years Ended December 31, 1994 and 1993
Fund F ................................................. 18
Loan Fund .............................................. 20
Notes to Financial Statements ............................. 23
2
<PAGE>
- -----------------------------------------------------------------
Index To Financial Statements Thrift Plan Of Phillips
And Schedules Petroleum Company
Page
Supplemental Schedules
Schedule of Assets Held for Investment Purposes
at December 31, 1994 .................................... 30
Schedule of Reportable Transactions for the
Year Ended December 31, 1994 ............................ 32
3
<PAGE>
- -----------------------------------------------------------------
Report Of Independent Auditors
The Thrift Plan Committee
Thrift Plan of Phillips Petroleum Company
We have audited the financial statements of the Thrift Plan of
Phillips Petroleum Company (Plan) listed in the accompanying
index to financial statements and schedules. These financial
statements are the responsibility of the Thrift Plan Committee
(Committee). 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 the Committee, 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 listed in the
accompanying index to financial statements and schedules present
fairly, in all material respects, the net assets available for
benefits of the Plan at December 31, 1994 and 1993, and the
changes in net assets available for plan benefits for each of the
three years in the period ended December 31, 1994, in conformity
with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying
supplemental schedules of assets held for investment purposes as
of December 31, 1994, and reportable transactions for the year
ended December 31, 1994, are presented for the purposes of
complying with the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974, and are not a required part of the basic
financial statements. The supplemental schedules have been
subjected to the auditing procedures applied in our audit of the
1994 financial statements and, in our opinion, are fairly stated
in all material respects in relation to the 1994 basic financial
statements taken as a whole.
/s/ ERNST & YOUNG LLP
-----------------
ERNST & YOUNG LLP
Tulsa, Oklahoma
June 27, 1995
4
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Phillips Petroleum Company
common stock $ 676,075 634,567
Insurance contracts 332,814 403,121
BT Pyramid Government Securities
Cash Fund 18,369 19,106
BT Pyramid Large Capitalization
Equity Index Fund 51,486 37,590
Wells Fargo Government/Corporate
Bond Index Fund E 70,712 90,558
BT Pyramid Discretionary Cash Fund 59,748 19,665
Loans to Plan participants 17,837 14,157
- -----------------------------------------------------------------
1,227,041 1,218,764
Cash - 1
Contributions Receivable 578 629
Employee Deposits Receivable 182 238
Loan Repayments Receivable 49 33
Interest Receivable 1,589 105
- -----------------------------------------------------------------
Total Assets 1,229,439 1,219,770
- -----------------------------------------------------------------
Liabilities
Securities Purchased 1,493 1,786
Other Liabilities 3 14
- -----------------------------------------------------------------
Total Liabilities 1,496 1,800
- -----------------------------------------------------------------
Net Assets Available for Benefits $1,227,943 1,217,970
=================================================================
See Notes to Financial Statements.
5
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
Thousands of Dollars
------------------------------------
Years Ended December 31 1994 1993 1992
------------------------------------
Additions
Contributions and Deposits
Company contributions
Matching $ 5,854 5,986 5,952
Before-tax deposits 17,313 16,518 15,388
Employee deposits 16,429 17,913 17,533
- -----------------------------------------------------------------
39,596 40,417 38,873
- -----------------------------------------------------------------
Investment Income
Dividends 24,213 26,091 30,231
Interest
Participant loans 919 - -
Other 33,492 35,642 40,991
Net appreciation 82,085 109,944 34,307
- -----------------------------------------------------------------
140,709 171,677 105,529
- -----------------------------------------------------------------
Total Additions 180,305 212,094 144,402
- -----------------------------------------------------------------
Deductions
Distributions to
Participants or Their
Beneficiaries
Cash 123,967 96,790 127,974
Phillips Petroleum Company
common stock 45,868 36,256 59,735
Forfeitures 2 9 6
Administrative Expense 452 425 -
Interest Expense 43 23 -
Transfer to Other Plans - (34) -
- -----------------------------------------------------------------
Total Deductions 170,332 133,469 187,715
- -----------------------------------------------------------------
Net Increase (Decrease) 9,973 78,625 (43,313)
Net Assets Available for
Benefits
Beginning of Year 1,217,970 1,139,345 1,182,658
- -----------------------------------------------------------------
End of Year $1,227,943 1,217,970 1,139,345
=================================================================
See Notes to Financial Statements.
6
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
FUND A
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Wells Fargo Government/Corporate
Bond Index Fund E $70,712 90,558
BT Pyramid Government Securities
Cash Fund - 22
- -----------------------------------------------------------------
70,712 90,580
Due from Temporary Investment Fund 123 140
Cash - 1
- -----------------------------------------------------------------
Total Assets 70,835 90,721
- -----------------------------------------------------------------
Liabilities
Other Liabilities 1 -
- -----------------------------------------------------------------
Net Assets Available for Benefits $70,834 90,721
=================================================================
Number of Units 6,939,191 8,552,717
Unit Value $10.2079 10.6073
- -----------------------------------------------------------------
See Notes to Financial Statements.
7
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
FUND A
Thousands of Dollars
---------------------------------
Years Ended December 31 1994 1993 1992
---------------------------------
Additions
Investment Income
Interest $ 2 300 5,239
Net appreciation
(depreciation) (3,127) 7,894 (986)
- -----------------------------------------------------------------
(3,125) 8,194 4,253
Allocation of Deposits and
Earnings from Temporary
Investment Fund 1,333 1,347 887
- -----------------------------------------------------------------
Total Additions (1,792) 9,541 5,140
- -----------------------------------------------------------------
Deductions
Cash Distributions to
Participants or Their
Beneficiaries 9,561 12,745 16,214
Administrative Expense 124 92 -
- -----------------------------------------------------------------
Total Deductions 9,685 12,837 16,214
- -----------------------------------------------------------------
Interfund Transfers (8,410) 17,681 10,903
- -----------------------------------------------------------------
Net Increase (Decrease) (19,887) 14,385 (171)
Net Assets Available for
Benefits
Beginning of Year 90,721 76,336 76,507
- -----------------------------------------------------------------
End of Year $70,834 90,721 76,336
=================================================================
See Notes to Financial Statements.
8
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
COMBINED FUNDS B AND C
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Phillips Petroleum Company
common stock $676,075 634,567
BT Pyramid Government Securities
Cash Fund 15,019 15,989
- -----------------------------------------------------------------
691,094 650,556
Due from Temporary Investment Fund
--Fund B 2,591 2,655
Contributions Receivable--Fund C 487 507
Interest Receivable 60 42
- -----------------------------------------------------------------
Total Assets 694,232 653,760
- -----------------------------------------------------------------
Liabilities
Securities Purchased 1,493 1,786
Other Liabilities - 14
- -----------------------------------------------------------------
Total Liabilities 1,493 1,800
- -----------------------------------------------------------------
Net Assets Available for Benefits $692,739 651,960
=================================================================
Net Assets Available for Benefits
Fund B $451,491 451,092
Fund C 241,248 200,868
- -----------------------------------------------------------------
$692,739 651,960
=================================================================
Number of Units
Fund B 6,248,165 6,682,406
Fund C 3,338,624 3,489,916
- -----------------------------------------------------------------
9,586,789 10,172,322
- -----------------------------------------------------------------
Unit Value $72.2598 64.0916
- -----------------------------------------------------------------
See Notes to Financial Statements.
9
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
COMBINED FUNDS B AND C
Thousands of Dollars
----------------------------------
Years Ended December 31 1994 1993 1992
----------------------------------
Additions
Investment Income
Dividends $ 24,213 26,091 30,231
Interest 434 396 347
Net appreciation 84,226 99,550 35,583
- -----------------------------------------------------------------
108,873 126,037 66,161
Matching Company
Contributions--Fund C 5,854 5,986 5,952
Allocation of Deposits and
Earnings from Temporary
Investment Fund--Fund B 25,932 26,322 26,105
- -----------------------------------------------------------------
Total Additions 140,659 158,345 98,218
- -----------------------------------------------------------------
Deductions
Distributions to
Participants or Their
Beneficiaries
Cash--Fund B 29,130 28,438 35,046
Cash--Fund C 13,557 12,036 17,408
Phillips Petroleum Company
common stock--Fund B 33,655 26,297 45,971
Phillips Petroleum Company
common stock--Fund C 12,213 9,959 13,764
Forfeitures--Fund C 2 9 6
Administrative Expense 119 229 -
Interest Expense 43 23 -
- -----------------------------------------------------------------
Total Deductions 88,719 76,991 112,195
- -----------------------------------------------------------------
Interfund Transfers (11,161) (84,113) (12,882)
- -----------------------------------------------------------------
Net Increase (Decrease) 40,779 (2,759) (26,859)
Net Assets Available for
Benefits
Beginning of Year 651,960 654,719 681,578
- -----------------------------------------------------------------
End of Year $692,739 651,960 654,719
=================================================================
Net Assets Available for
Benefits
Fund B 451,491 451,092 454,731
Fund C 241,248 200,868 199,988
- -----------------------------------------------------------------
692,739 651,960 654,719
=================================================================
See Notes to Financial Statements.
10
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
FUND D--DEPOSIT ADMINISTRATION ACCOUNT
Thousands of Dollars
----------------------
At December 31 1994 1993
----------------------
Assets
Investments
Insurance contracts
Travelers Insurance Company,
Group Annuity Contract GR-15505 $158,442 178,356
The Prudential Insurance Company of
America, Group Annuity Contract
GA-5991 19,932 71,323
Continental Assurance Company,
Group Annuity, Contract GP-12692 65,837 63,945
Group Annuity, Contract GP-12787 23,312 25,270
Provident National Assurance,
Group Annuity, Contract GC-05048 64,447 62,994
BT Pyramid Government Securities
Cash Fund 14 -
- -----------------------------------------------------------------
331,984 401,888
Interest Receivable 1,219 -
- -----------------------------------------------------------------
Total Assets 333,203 401,888
- -----------------------------------------------------------------
Net Assets Available for Benefits $333,203 401,888
=================================================================
Number of Units (A)
Unit Values (A)
- -----------------------------------------------------------------
(A) See Note 5.
See Notes to Financial Statements.
11
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
FUND D--DEPOSIT ADMINISTRATION ACCOUNT
Thousands of Dollars
----------------------------------
Years Ended December 31 1994 1993 1992
----------------------------------
Additions
Investment Income
Interest $ 30,956 34,444 34,726
Allocation of Deposits and
Earnings from Temporary
Investment Fund - 2,124 6,017
- -----------------------------------------------------------------
Total Additions 30,956 36,568 40,743
- -----------------------------------------------------------------
Deductions
Cash Distributions to
Participants or Their
Beneficiaries 51,376 38,509 58,360
Administrative Expense 97 55 -
- -----------------------------------------------------------------
Total Deductions 51,473 38,564 58,360
- -----------------------------------------------------------------
Interfund Transfers (48,168) (2,654) 19,265
- -----------------------------------------------------------------
Net Increase (Decrease) (68,685) (4,650) 1,648
Net Assets Available for
Benefits
Beginning of Year 401,888 406,538 404,890
- -----------------------------------------------------------------
End of Year $333,203 401,888 406,538
=================================================================
See Notes to Financial Statements.
12
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
FUND D--DEFERRED SETTLEMENT ACCOUNT
Thousands of Dollars
----------------------
At December 31 1994 1993
----------------------
Assets
Investments
Insurance contract $844 1,233
- -----------------------------------------------------------------
Total Assets 844 1,233
- -----------------------------------------------------------------
Net Assets Available for Benefits $844 1,233
=================================================================
See Notes to Financial Statements.
13
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
FUND D--DEFERRED SETTLEMENT ACCOUNT
Thousands of Dollars
--------------------------------
Years Ended December 31 1994 1993 1992
--------------------------------
Additions
Investment Income
Interest $ 118 89 137
- -----------------------------------------------------------------
Total Additions 118 89 137
- -----------------------------------------------------------------
Deductions
Cash Distributions to
Participants or Their
Beneficiaries 507 608 837
- -----------------------------------------------------------------
Total Deductions 507 608 837
- -----------------------------------------------------------------
Net Decrease (389) (519) (700)
Net Assets Available for
Benefits
Beginning of Year 1,233 1,752 2,452
- -----------------------------------------------------------------
End of Year $ 844 1,233 1,752
=================================================================
See Notes to Financial Statements.
14
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
FUND E
Thousands of Dollars
----------------------
At December 31 1994 1993
----------------------
Assets
Investments
BT Pyramid Large Capitalization
Equity Index Fund $51,486 37,590
Due From Temporary Investment Fund 375 350
- ----------------------------------------------------------------
Total Assets 51,861 37,940
- ----------------------------------------------------------------
Net Assets Available for Benefits $51,861 37,940
================================================================
Number of Units 46,125,102 34,189,510
Unit Value $1.1243 1.1097
- ----------------------------------------------------------------
See Notes to Financial Statements.
15
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
FUND E
Thousands of Dollars
---------------------------------
Years Ended December 31 1994 1993 1992
---------------------------------
Additions
Investment Income
Interest
Debt securities of
Phillips Petroleum
Company $ - - 452
Other - - 2
Net appreciation
(depreciation) 986 2,500 (290)
- -----------------------------------------------------------------
986 2,500 164
Allocation of Deposits and
Earnings from Temporary
Investment Fund 3,818 3,026 -
- -----------------------------------------------------------------
Total Additions 4,804 5,526 164
- -----------------------------------------------------------------
Deductions
Cash Distributions to
Participants or Their
Beneficiaries 3,928 1,950 109
Administrative Expense 73 42 -
- -----------------------------------------------------------------
Total Deductions 4,001 1,992 109
- -----------------------------------------------------------------
Interfund Transfers 13,118 34,406 (17,286)
- -----------------------------------------------------------------
Net Increase (Decrease) 13,921 37,940 (17,231)
Net Assets Available for
Benefits
Beginning of Year 37,940 - 17,231
- -----------------------------------------------------------------
End of Year $51,861 37,940 -
=================================================================
See Notes to Financial Statements.
16
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
FUND F
Thousands of Dollars
----------------------
At December 31 1994 1993
----------------------
Assets
Investments
BT Pyramid Discretionary Cash Fund $59,748 19,665
Due from Temporary Investment Fund 278 350
Interest Receivable 297 56
- -----------------------------------------------------------------
Total Assets 60,323 20,071
- -----------------------------------------------------------------
Liabilities
Other Liabilities 2 -
- -----------------------------------------------------------------
Net Assets Available for Benefits $60,321 20,071
=================================================================
Number of Units 57,120,734 19,802,851
Unit Value $1.056 $1.0135
- -----------------------------------------------------------------
See Notes to Financial Statements.
17
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
FUND F
Thousands of Dollars
----------------------
Year Ended December 31 1994 1993
----------------------
Additions
Investment Income
Interest $ 1,867 228
Allocation of Deposits and
Earnings from Temporary
Investment Fund 2,773 1,682
- -----------------------------------------------------------------
Total Additions 4,640 1,910
- -----------------------------------------------------------------
Deductions
Cash Distributions to Participants
or Their Beneficiaries 15,426 2,491
Transfer from Other Plans - (34)
Administrative Expense 39 7
- -----------------------------------------------------------------
Total Deductions 15,465 2,464
- -----------------------------------------------------------------
Interfund Transfers 51,075 20,625
- -----------------------------------------------------------------
Net Increase 40,250 20,071
Net Assets Available for
Benefits
Beginning of Year 20,071 -
- -----------------------------------------------------------------
End of Year 60,321 $20,071
=================================================================
See Notes to Financial Statements.
18
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
LOAN FUND
Thousands of Dollars
----------------------
At December 31 1994 1993
----------------------
Assets
Investments
Loans to participants $17,837 14,157
Due from Temporary Investment Fund 304 -
- -----------------------------------------------------------------
Total Assets 18,141 14,157
- -----------------------------------------------------------------
Net Assets Available for Benefits $18,141 14,157
=================================================================
See Notes to Financial Statements.
19
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
LOAN FUND
Thousands of Dollars
----------------------
Year Ended December 31 1994 1993
----------------------
Additions
Interest--Participant Loans $ 919 -
- -----------------------------------------------------------------
Deductions
Cash Distributions to
Participants or Their
Beneficiaries 482 13
Loan Repayments from Plan
Participants 5,934 523
- -----------------------------------------------------------------
Total Deductions 6,416 536
- -----------------------------------------------------------------
Interfund Transfers 9,481 14,693
- -----------------------------------------------------------------
Net Increase 3,984 14,157
Net Assets Available for
Benefits
Beginning of Year 14,157 -
- -----------------------------------------------------------------
End of Year $18,141 14,157
=================================================================
See Notes to Financial Statements.
20
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Thrift Plan Of Phillips
Available For Benefits Petroleum Company
TEMPORARY INVESTMENT FUND
Thousands of Dollars
----------------------
At December 31 1994 1993
----------------------
Assets
Investments
BT Pyramid Government Securities
Cash Fund $3,336 3,095
Contributions Receivable 91 122
Employee Deposits Receivable 182 238
Loan Repayments Receivable 49 33
Interest Receivable 13 7
- -----------------------------------------------------------------
Total Assets 3,671 3,495
- -----------------------------------------------------------------
Liabilities
Due to Fund A 123 140
Due to Fund B 2,591 2,655
Due to Fund E 375 350
Due to Fund F 278 350
Due to Loan Fund 304 -
- -----------------------------------------------------------------
Total Liabilities 3,671 3,495
- -----------------------------------------------------------------
Net Assets Available for Benefits $ - -
=================================================================
See Notes to Financial Statements.
21
<PAGE>
- -----------------------------------------------------------------
Statement Of Changes In Net Thrift Plan Of Phillips
Assets Available For Benefits Petroleum Company
TEMPORARY INVESTMENT FUND
Thousands of Dollars
----------------------------------
Years Ended December 31 1994 1993 1992
----------------------------------
Additions
Contributions and Deposits
Company contributions--
before-tax deposits $17,313 16,518 15,388
Employee deposits 16,429 17,913 17,533
Loan repayments from
Plan participants 5,934 523 -
- -----------------------------------------------------------------
39,676 34,954 32,921
Investment Income
Interest 115 185 88
- -----------------------------------------------------------------
Total Additions 39,791 35,139 33,009
- -----------------------------------------------------------------
Deductions
Allocation of Deposits and
Earnings 33,856 34,501 33,009
- -----------------------------------------------------------------
Interfund Transfers (5,935) (638) -
Net Increase - - -
Net Assets Available for
Benefits
Beginning of Year - - -
- -----------------------------------------------------------------
End of Year $ - - -
=================================================================
See Notes to Financial Statements.
22
<PAGE>
- -----------------------------------------------------------------
Notes To Financial Statements Thrift Plan Of Phillips
Petroleum Company
Note 1--Plan Description
The following description of the Thrift Plan of Phillips
Petroleum Company (Plan) is subject to and qualified by the more
complete information appearing in the Plan document.
The Plan is a defined contribution plan available to certain
employees of Phillips Petroleum Company and participating
subsidiaries (Company). Generally, any regular employee on the
direct dollar payroll of the Company is eligible to participate.
Non-managerial retail outlet marketing employees are not
eligible. Effective August 23, 1993, assets and liabilities
associated with accounts from the Salary Reduction Thrift Plan
for Employees of Incinatrol, Inc. were transferred to the Plan.
The Company has a trust agreement with Bankers Trust Company, New
York, New York (Trustee). Plan investments are held by the
Trustee. Fund A is managed by the Trustee, with Wells Fargo
Institutional Trust Company managing Fund A assets invested in
the Wells Fargo Government/Corporate Bond Index Fund E.
Participants may have up to 15 percent of their pay deposited in
the Plan each month. The first 5 percent is designated as
regular deposits with any excess being designated as supplemental
deposits. Deposits may be further designated by a participant as
before-tax or after-tax deposits. Before-tax deposits are made
by the Company on behalf of a participant who has elected the
before-tax feature of the Plan. Total deposit amounts and
allocation of deposits between after-tax and before-tax accounts
are subject to limitations imposed by the Internal Revenue Code.
Participants may change their investment direction and deposit
rate semiannually during designated enrollment periods. Employee
deposits may be suspended in certain circumstances.
The Company contributes an amount equal to 25 percent of an
employee's regular deposits made to Fund B and 15 percent of
regular deposits made to any other investment fund.
Employee and before-tax deposits and loan repayments are first
placed in the Temporary Investment Fund and invested in certain
specified short-term securities for up to 45 days after receipt
by the Trustee. Loan repayments and any earnings thereon are
transferred to the Loan Fund and then allocated to Funds A, B, E
or F based on a participant's regular deposits. Employee
deposits and the earnings thereon are paid into Funds A, B, E or
F as directed by the participant, and invested as follows: Fund
A (commingled Wells Fargo Government/Corporate Bond Index Fund E
managed by Wells Fargo Institutional Trust Company), Fund B
(common stock of Phillips Petroleum Company), Fund E (commingled
23
<PAGE>
BT Pyramid Large Capitalization Equity Index Fund managed by
Bankers Trust Company) and Fund F (effective July 1, 1993, in the
BT Pyramid Discretionary Cash Fund, a commingled money market
fund managed by Bankers Trust Company). After June 30, 1993,
Fund D (investment contracts which guarantee repayment of
principal invested and a fixed rate of interest) no longer
accepts deposits. Company matching contributions are invested in
Fund C (common stock of Phillips Petroleum Company). The Loan
Fund is used to record transactions resulting from loans made to
active employees against their accounts. Except for the
Temporary Investment Fund and the Loan Fund, the interest of
participants in each fund is represented by units allocated to
them.
The Plan provides for monthly transfers among funds; however,
plan participants may not direct transfers to Fund C, the Loan
Fund, or the Temporary Investment Fund. Transfers to Fund D were
permitted only in certain circumstances until June 15, 1993, but
due to restrictions required by the insurance companies,
transfers were not allowed out of Fund D after January 15, 1993.
A participant is vested at all times with respect to his
deposits. Generally, a participant is vested with respect to his
interest in Company contributions (a) if he has made, or has had
made on his behalf, regular deposits for 12 months; (b) upon
retirement pursuant to a Company retirement plan; (c) upon death;
(d) upon becoming totally and permanently disabled; (e) upon
reaching age 65; (f) upon being laid off; or (g) upon completion
of five years of vesting service.
Generally a participant may, as of any valuation date, withdraw
any portion of his vested interest in his after-tax account. A
participant may not withdraw his interest in his before-tax
account unless he is at least age 59 1/2, experiences a specified
financial hardship, becomes totally and permanently disabled, or
separates from service.
Forfeitures arising from nonvested withdrawals are used to reduce
future Company contributions. Forfeitures may be restored under
certain circumstances if the participant later repays the amount
withdrawn.
Distributions occur upon separation from service, but may be
deferred. For a participant who retires or becomes totally
disabled, distribution will be deferred to a date not later than
February of the year after the year age 70 1/2 is attained. If
the participant dies, distribution to a surviving spouse
beneficiary will be deferred to the second valuation date prior
to the date on which the participant would have attained age
70 1/2. This deferral is revocable by the participant or the
surviving spouse. Distributions to non-spouse beneficiaries may
be deferred approximately five years. Distributions are based on
the valuation of the participant's interest in the trust fund.
Available forms of distribution are:
24
<PAGE>
(a) from Funds A, D, E or F in cash (distributions from
Fund F were not available until 1993);
(b) from Funds B and C in whole shares of common stock
and/or cash;
(c) with respect to a participant who retires under a
Company retirement plan or a beneficiary spouse of a
participant in the event of an active employee
participant's death, in the form of an irrevocable
nontransferable monthly annuity purchased with a
specified dollar amount of the participant's interest in
the Plan; and
(d) with respect to a participant who retired before July 1,
1992, under a Company retirement plan, monthly,
quarterly or annual payments irrevocably elected from
his interest in Fund D commencing at retirement with, at
the participant's direction, a designated life interest
beneficiary to receive any unpaid scheduled payments
following the participant's death.
A participant may elect a direct rollover of the taxable portion
of most distributions to an Individual Retirement Account or
another tax-qualified plan. The taxable portion of any such
distribution that is not rolled over directly will be subject to
20 percent federal withholding.
The Plan is administered by a Thrift Plan Committee, the members
of which are appointed by the Board of Directors of Phillips
Petroleum Company. The Plan Financial Administrator and Plan
Benefits Administrator are the persons who occupy, respectively,
the Phillips Petroleum Company positions of Risk Management and
Investment Manager, and Compensation and Benefits Manager.
Members of the Committee and the Plan Administrators serve
without compensation, but are reimbursed by the Company for
necessary expenditures incurred in the discharge of their duties.
The Plan pays all reasonable expenses necessary for the operation
of the Plan unless such expenses are paid by the Company. The
Company pays only the Trustee's recordkeeping and accounting fees
and the class year contract administration fees of .15 percent of
the funds invested in the insured contracts in Fund D.
The Company intends to continue the Plan indefinitely, but
reserves the right to amend or terminate it at any time. In the
event of termination of the Plan, each participant will become
fully vested.
25
<PAGE>
Note 2--Investments
All securities are valued at their quoted market price or, with
respect to units of participation in commingled funds, redemption
value. Insurance contracts are valued pursuant to their terms;
the value represents fund deposits plus interest credited less
distributions. Participant loans are valued at cost, which
approximates fair value.
Note 3--Contributions Receivable
Contributions receivable at December 31 included the following:
Thousands of Dollars
--------------------
1994 1993
--------------------
Receivable from the Company for
matching contributions $487 507
Before-tax deposits 91 122
- -----------------------------------------------------------------
$578 629
=================================================================
Note 4--Funds B and C
Because Funds B and C have the same investment objectives, hold
assets in common (primarily Phillips Petroleum Company common
stock) and maintain a common unit value, the financial statements
of these two funds have been presented on a combined basis.
Note 5--Class Year Accounts
A breakdown of Fund D--Deposit Administration Account by Class
Year at December 31 follows:
Thousands
of Dollars
------------
Net Assets
Available Number Unit
for Benefits of Units Values
------------------------------------
1994
- ----
1992 $ 23,398 11,695,202 2.0007
1991 130,768 52,038,039 2.5129
1990 159,031 49,817,416 3.1923
1989 20,006 6,284,080 3.1836
- -----------------------------------------------------------------
$333,203
=================================================================
1993
- ----
1992 $ 25,270 13,387,160 1.8876
1991 126,939 54,885,147 2.3128
1990 178,356 60,899,767 2.9287
1989 19,925 6,837,204 2.9141
1988 51,398 8,904,618 5.7721
- -----------------------------------------------------------------
$401,888
=================================================================
26
<PAGE>
Note 6--Loan Fund
Since July 1, 1993, the Plan has allowed loans to active
employees or parties in interest from their accounts. The
minimum loan is $1,000, and generally the maximum is the lesser
of $50,000 or half a participant's vested account. The loans may
extend for up to 60 months (180 months for a home loan) with a
rate of interest equal to the national prime lending rate, as
determined on the regular valuation date prior to the date of a
loan application. No more than one home loan and two regular
loans may be outstanding at any given time.
Loan payments and interest are repaid to the borrowing
participant's accounts through the Loan Fund, which records the
outstanding loans and related transactions. Repayments are
allocated to Funds A, B, E or F based on a participant's regular
deposits. For the periods ended December 31, the total of loans
made by fund of origin, principal repaid, and aggregate
outstanding loan balances were:
Thousands of Dollars
---------------------------------------------
Fund A B C D E F Total
---------------------------------------------
Period ended
December 31, 1994
- -----------------
Loans Outstanding
at December 31,
1993 $14,157
Participant Loans $ 623 6,889 62 826 455 322 9,177
Principal Repaid 106 4,293 221 - 138 257 5,015
Distributions to
Participants 482
- -----------------------------------------------------------------
Loans Outstanding
at December 31,
1994 $17,837
=================================================================
Period ended
December 31, 1993
- -----------------
Participant Loans $1,500 10,428 62 1,724 834 132 14,680
Principal Repaid 12 418 35 - 37 21 523
- -----------------------------------------------------------------
Loans Outstanding
at December 31,
1993 $14,157
=================================================================
Note 7--Allocation of Deposits and Earnings from Temporary
Investment Fund
Allocation of deposits and earnings from the Temporary Investment
Fund represents the allocation of employee deposits and
before-tax contributions made to the Temporary Investment Fund
and related earnings thereon. A breakdown of the allocation for
each of the periods follows:
27
<PAGE>
Thousands of Dollars
--------------------------------------
Fund A Fund B Fund D Fund E Fund F
--------------------------------------
December 31, 1994
- -----------------
Employee deposits $ 746 11,982 - 1,926 1,774
Before-tax contributions 584 13,932 - 1,841 956
Interest 3 18 - 51 43
- -----------------------------------------------------------------
$1,333 25,932 - 3,818 2,773
=================================================================
December 31, 1993
- -----------------
Employee deposits $ 769 12,957 1,388 1,645 1,149
Before-tax contributions 575 13,308 730 1,375 530
Interest 3 57 6 6 3
- -----------------------------------------------------------------
$1,347 26,322 2,124 3,026 1,682
=================================================================
December 31, 1992
- -----------------
Employee deposits $ 480 13,183 3,871 - -
Before-tax contributions 405 12,853 2,130 - -
Interest 2 69 16 - -
- -----------------------------------------------------------------
$ 887 26,105 6,017 - -
=================================================================
Note 8--Credit Facility
Effective July 14, 1993, the Plan established a 364-day
$50 million revolving credit facility with NationsBank of Texas,
N.A., for the purpose of financing net Fund B and Fund C
distributions, participant loans from the Plan, or transfer of
participants' interests to other funds of the Plan. The interest
rate may not exceed the Eurodollar interbank offered rate plus
0.25 percent. Effective June 17, 1994, this credit facility was
reduced to $25 million. The Plan Trustee requested that the
credit facility be renewed for this reduced amount for an
additional year. On December 31, 1994, no portion of this credit
facility was outstanding.
Phillips Petroleum Company has made application to the Department
of Labor to obtain certain exemptions from the Employee
Retirement Income Security Act of 1974 and/or the Internal
Revenue Code of 1986. If granted, these exemptions would permit
the Company to make interest-free loans to the Plan, pursuant to
the terms of a credit facility arrangement, and the repayment of
such loans by the Plan to the Company. This arrangement would be
used for the same purposes as the $25 million credit facility
with NationsBank of Texas, N.A., which would be closed.
Note 9--Transactions with Parties-in-Interest
During 1994, 1993 and 1992, the Plan received $24,213,000,
$26,079,000 and $30,231,000, respectively, in common stock
dividends from the Company. Fees paid for legal, accounting, and
other services rendered by parties-in-interest were based on
customary and reasonable rates for such services.
28
<PAGE>
Note 10--Tax Status
The Internal Revenue Service (IRS) determined on September 27,
1991, that the Plan, as amended through December 5, 1990, is
qualified under Section 401(a) of the Internal Revenue Code of
1986 and the Trust is exempt from federal income tax under
Section 501(a). Subsequent amendments have been adopted, but are
not expected to affect the qualified status of the Plan. A
determination letter application was filed with the IRS in 1994,
with an updated determination letter expected in 1995. The
Committee is not aware of any activity that would affect the
qualified status of the Plan.
29
<PAGE>
- -----------------------------------------------------------------------------
Schedule Of Assets Held Thrift Plan Of Phillips
For Investment Purposes Petroleum Company
Item 27a EIN 73-0400345, Plan No. 002
At December 31, 1994
Description of investment Thousands of Dollars
Identity of issue, including maturity date, ---------------------
borrower, lessor, rate of interest, collateral, Historical Current
or similar party par or maturity value Cost Value
- -------------------- -------------------------------- ---------- ---------
Phillips Petroleum Common stock, $1.25 par value,
Company* 20,643,500 shares $316,895 676,075
- -----------------------------------------------------------------------------
Bankers Trust 51,291.51 units, BT Pyramid
Company* Large Capitalization Equity
Index Fund 50,499 51,486
18,369,320.87 units, BT Pyramid
Government Securities Cash
Fund 18,369 18,369
59,748,034.03 units, BT Pyramid
Discretionary Cash Fund 59,748 59,748
- -----------------------------------------------------------------------------
128,616 129,603
- -----------------------------------------------------------------------------
Wells Fargo 6,779,401.69 units, Wells Fargo
Institutional Government/Corporate Bond
Trust Company* Index Fund E 65,012 70,712
- -----------------------------------------------------------------------------
Thrift Plan of Loans to Plan participants at
Phillips Petroleum 6% - 8 1/2%
Company 17,837 17,837
- -----------------------------------------------------------------------------
Travelers Insurance Group Annuity Contract GR-15505,
Company* deposit administration account 158,442 158,442
Group Annuity Contract GR-1966A,
deferred settlement account 844 844
Prudential Insurance Group Annuity Contract GA-5991,
Company of America* deposit administration account 19,932 19,932
30
<PAGE>
- -----------------------------------------------------------------------------
Schedule Of Assets Held Thrift Plan Of Phillips
For Investment Purposes Petroleum Company
Item 27a EIN 73-0400345, Plan No. 002
At December 31, 1994
Description of investment Thousands of Dollars
Identity of issue, including maturity date, ---------------------
borrower, lessor, rate of interest, collateral, Historical Current
or similar party par or maturity value Cost Value
- -------------------- -------------------------------- ---------- ---------
Continental Group Annuity Contract GP-12692,
Assurance Company* deposit administration account 65,837 65,837
Group Annuity Contract GP-12787,
deposit administration account 23,312 23,312
Provident National Group Annuity Contract
Assurance* GC-027-05048, deposit
administration account 64,447 64,447
- -----------------------------------------------------------------------------
332,814 332,814
- -----------------------------------------------------------------------------
$861,174 1,227,041
=============================================================================
*Party-in-interest
31
<PAGE>
- ------------------------------------------------------------------------------
Schedule of Reportable Transactions Thrift Plan of Phillips
Item 27d Petroleum Company
EIN 73-0400345, Plan 002
Year Ended December 31, 1994
Thousands of Dollars
Total Total --------------------------------
number of number of Gain or
Identity of party purchases sales Value (loss) as a
involved and during the during the Value of of result of
description of asset plan year plan year purchases* sales* transactions
- -------------------- ---------- ---------- ---------- ------ ------------
Bankers Trust
Company, BT
Pyramid Government
Securities Cash
Fund 228 178 $124,049 124,785 -
Bankers Trust
Company, BT Pyramid
Discretionary Cash
Fund 42 34 53,717 13,634 -
- -----------------------------------------------------------------------------
*This is also the current value at time of transaction.
32
<PAGE>
Exhibit 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8, File No. 33-50134) pertaining to the Thrift
Plan of Phillips Petroleum Company and in the related Prospectus
of our report dated June 27, 1995, with respect to the financial
statements and schedules of the Thrift Plan of Phillips Petroleum
Company included in this Annual Report (Form 11-K) for the year
ended December 31, 1994.
/s/ ERNST & YOUNG LLP
-----------------
ERNST & YOUNG LLP
Tulsa, Oklahoma
June 27, 1995
<PAGE>
Exhibit 99(b)
FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the year ended December 31, 1994
------------------------------------
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 33-50283
--------------------------------
LONG-TERM STOCK SAVINGS PLAN OF
PHILLIPS PETROLEUM COMPANY
(Full title of the Plan)
PHILLIPS PETROLEUM COMPANY
(Name of issuer of securities)
Bartlesville, Oklahoma 74004
(Address of principal executive office) (Zip code)
<PAGE>
FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
--------------------
Financial statements of the Long-Term Stock Savings Plan of
Phillips Petroleum Company, filed as part of this annual report,
are listed in the accompanying index.
(b) Exhibits
--------
Exhibit 1 Consent of Ernst & Young LLP.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Long-Term Stock Savings Plan Committee has duly caused
this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
LONG-TERM STOCK SAVINGS PLAN
OF PHILLIPS PETROLEUM COMPANY
/s/ D. R. Divelbiss
-----------------------------
D. R. Divelbiss
Member
Long-Term Stock Savings
Plan Committee
June 27, 1995
1
<PAGE>
- -----------------------------------------------------------------
Index To Financial Statements Long-Term Stock Savings Plan
And Schedules Of Phillips Petroleum Company
Page
Report of Independent Auditors ............................. 3
Financial Statements
Statements of Net Assets Available for Benefits
at December 31, 1994 and 1993
Total Plan ........................................... 4
Fund EP .............................................. 6
Fund K ............................................... 8
Fund L ............................................... 10
Temporary Fund ....................................... 12
Statements of Changes in Net Assets Available for
Benefits for the Years Ended December 31, 1994,
1993 and 1992
Total Plan ........................................... 5
Fund EP .............................................. 7
Fund K ............................................... 9
Fund L ............................................... 11
Temporary Fund ....................................... 13
Notes to Financial Statements ............................ 14
Supplemental Schedules
Schedule of Assets Held for Investment Purposes at
December 31, 1994 ...................................... 18
Schedule of Reportable Transactions for the Year Ended
December 31, 1994 ...................................... 19
2
<PAGE>
- -----------------------------------------------------------------
Report Of Independent Auditors
The Long-Term Stock Savings Plan Committee
Long-Term Stock Savings Plan of Phillips Petroleum Company
We have audited the financial statements of the Long-Term Stock
Savings Plan of Phillips Petroleum Company (Plan) listed in the
accompanying index to financial statements and schedules. These
financial statements are the responsibility of the Long-Term
Stock Savings Plan Committee (Committee). 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 the Committee, 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 listed in the
accompanying index to financial statements and schedules present
fairly, in all material respects, the net assets available for
benefits of the Plan at December 31, 1994 and 1993, and the
changes in net assets available for plan benefits for each of the
three years in the period ended December 31, 1994, in conformity
with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying
supplemental schedules of assets held for investment purposes as
of December 31, 1994, and reportable transactions for the year
ended December 31, 1994, are presented for purposes of complying
with the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974, and are not a required part of the basic
financial statements. The supplemental schedules have been
subjected to the auditing procedures applied in our audit of the
1994 financial statements and, in our opinion, are fairly stated
in all material respects in relation to the 1994 basic financial
statements taken as a whole.
/s/ ERNST & YOUNG LLP
-----------------
ERNST & YOUNG LLP
Tulsa, Oklahoma
June 27, 1995
3
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Long-Term Stock Savings Plan
Available For Benefits Of Phillips Petroleum Company
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Common stock $1,079,269 984,885
Commingled fund 4,751 7,073
- -----------------------------------------------------------------
1,084,020 991,958
Company Contributions Receivable
Funds for debt service 249 -
Before-tax deposits 35 79
Interest Receivable 41 27
- -----------------------------------------------------------------
Total Assets 1,084,345 992,064
- -----------------------------------------------------------------
Liabilities
Securities Acquisition Loans 502,250 527,850
Interest Payable 2,515 1,553
Stock Distributions Payable - 26
Securities Purchased 250 148
Administrative Expenses Payable 100 100
- -----------------------------------------------------------------
Total Liabilities 505,115 529,677
- -----------------------------------------------------------------
Net Assets Available for Benefits $ 579,230 462,387
=================================================================
See Notes to Financial Statements.
4
<PAGE>
- -------------------------------------------------------------------
Statement Of Changes In Net Long-Term Stock Savings Plan
Assets Available For Benefits Of Phillips Petroleum Company
Thousands of Dollars
----------------------------------
Years Ended December 31 1994 1993 1992
----------------------------------
Additions
Company Contributions
Funds for debt service $ 11,797 6,605 13,216
Basic allocation requirements 56 286 188
Before-tax deposits 5,988 6,449 6,501
- -------------------------------------------------------------------
17,841 13,340 19,905
- -------------------------------------------------------------------
Investment Income
Dividends 37,527 38,514 39,445
Interest 337 321 363
Net appreciation 126,928 134,935 40,582
- -------------------------------------------------------------------
164,792 173,770 80,390
- -------------------------------------------------------------------
Other - - 20
- -------------------------------------------------------------------
Total Additions 182,633 187,110 100,315
- -------------------------------------------------------------------
Deductions
Distributions to Participants
or Their Beneficiaries
Common stock 41,698 31,869 32,598
Cash 27 20 29
- -------------------------------------------------------------------
41,725 31,889 32,627
Interest Expense 23,965 19,496 24,015
Administrative Expense 100 100 100
- -------------------------------------------------------------------
Total Deductions 65,790 51,485 56,742
- -------------------------------------------------------------------
Net Increase 116,843 135,625 43,573
Net Assets Available for
Benefits
Beginning of Year 462,387 326,762 283,189
- -------------------------------------------------------------------
End of Year $579,230 462,387 326,762
===================================================================
See Notes to Financial Statements.
5
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Long-Term Stock Savings Plan
Available For Benefits Of Phillips Petroleum Company
FUND EP
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Common stock $183,106 170,772
Commingled fund 12 10
- -----------------------------------------------------------------
183,118 170,782
Interest Receivable 1 1
- -----------------------------------------------------------------
Total Assets 183,119 170,783
- -----------------------------------------------------------------
Liabilities
Stock Distributions Payable - 18
Administrative Expenses Payable 100 100
- -----------------------------------------------------------------
Total Liabilities 100 118
- -----------------------------------------------------------------
Net Assets Available for Benefits $183,019 170,665
=================================================================
Number of Units 31,621,315 33,285,802
Unit Value $5.7878 5.1272
- -----------------------------------------------------------------
See Notes to Financial Statements.
6
<PAGE>
- -------------------------------------------------------------------
Statement Of Changes In Net Long-Term Stock Savings Plan
Assets Available For Benefits Of Phillips Petroleum Company
FUND EP
Thousands of Dollars
----------------------------------
Years Ended December 31 1994 1993 1992
----------------------------------
Additions
Investment Income
Dividends $ 6,465 6,734 7,185
Interest 3 2 4
Net appreciation 22,230 24,082 7,800
- -------------------------------------------------------------------
28,698 30,818 14,989
Other - - 20
- -------------------------------------------------------------------
Total Additions 28,698 30,818 15,009
- -------------------------------------------------------------------
Deductions
Distributions to Participants
or Their Beneficiaries
Common stock 16,234 15,407 19,100
Cash 10 16 14
- -------------------------------------------------------------------
16,244 15,423 19,114
Administrative Expense 100 100 100
- -------------------------------------------------------------------
Total Deductions 16,344 15,523 19,214
- -------------------------------------------------------------------
Net Increase (Decrease) 12,354 15,295 (4,205)
Net Assets Available for
Benefits
Beginning of Year 170,665 155,370 159,575
- -------------------------------------------------------------------
End of Year $183,019 170,665 155,370
===================================================================
See Notes to Financial Statements.
7
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Long-Term Stock Savings Plan
Available For Benefits Of Phillips Petroleum Company
FUND K
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Common stock $40,260 31,758
Commingled fund 311 503
- -----------------------------------------------------------------
40,571 32,261
Due from Temporary Fund 536 602
Interest Receivable 2 1
- -----------------------------------------------------------------
Total Assets 41,109 32,864
- -----------------------------------------------------------------
Liabilities
Securities Purchased 250 148
Stock Distributions Payable - 1
- -----------------------------------------------------------------
Total Liabilities 250 149
- -----------------------------------------------------------------
Net Assets Available for Benefits $40,859 32,715
=================================================================
Number of Units 29,183,701 26,428,925
Unit Value $1.4000 1.2379
- -----------------------------------------------------------------
See Notes to Financial Statements.
8
<PAGE>
- -------------------------------------------------------------------
Statement Of Changes In Net Long-Term Stock Savings Plan
Assets Available For Benefits Of Phillips Petroleum Company
FUND K
Thousands of Dollars
---------------------------------
Years Ended December 31 1994 1993 1992
---------------------------------
Additions
Allocation of Deposits and
Earnings from Temporary
Fund $ 6,005 6,463 6,518
- -------------------------------------------------------------------
Investment Income
Dividends 1,295 1,134 904
Interest 16 12 13
Net appreciation 4,280 3,463 830
- -------------------------------------------------------------------
5,591 4,609 1,747
- -------------------------------------------------------------------
Total Additions 11,596 11,072 8,265
- -------------------------------------------------------------------
Deductions
Distributions to (refunds from)
Participants or Their
Beneficiaries
Common stock 3,451 2,278 1,883
Cash 1 (1) -
- -------------------------------------------------------------------
Total Deductions 3,452 2,277 1,883
- -------------------------------------------------------------------
Net Increase 8,144 8,795 6,382
Net Assets Available for
Benefits
Beginning of Year 32,715 23,920 17,538
- -------------------------------------------------------------------
End of Year $40,859 32,715 23,920
===================================================================
See Notes to Financial Statements.
9
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Long-Term Stock Savings Plan
Available For Benefits Of Phillips Petroleum Company
FUND L
Thousands of Dollars
------------------------
At December 31 1994 1993
------------------------
Assets
Investments
Common stock $855,903 782,355
Commingled fund 3,929 6,038
- -----------------------------------------------------------------
859,832 788,393
Company Contributions Receivable
Funds for debt service 249 -
Interest Receivable 36 24
- -----------------------------------------------------------------
Total Assets* 860,117 788,417
- -----------------------------------------------------------------
Liabilities
Securities Acquisition Loans 502,250 527,850
Interest Payable 2,515 1,553
Stock Distributions Payable - 7
- -----------------------------------------------------------------
Total Liabilities 504,765 529,410
- -----------------------------------------------------------------
Net Assets Available for Benefits $355,352 259,007
=================================================================
Number of Units 137,476,120 120,191,086
Unit Value** $1.8728 1.6583
- -----------------------------------------------------------------
See Notes to Financial Statements.
*The amount of total assets that was not allocated to
participants at December 31, 1994 and 1993 was $602,655
thousand and $589,098 thousand, respectively.
**Unit value calculated on assets allocated to participants only.
10
<PAGE>
- -------------------------------------------------------------------
Statement Of Changes In Net Long-Term Stock Savings Plan
Assets Available For Benefits Of Phillips Petroleum Company
FUND L
Thousands of Dollars
----------------------------------
Years Ended December 31 1994 1993 1992
----------------------------------
Additions
Company Contributions
Funds for debt service $ 11,797 6,605 13,216
Basic allocation requirements 56 286 188
- -------------------------------------------------------------------
11,853 6,891 13,404
- -------------------------------------------------------------------
Investment Income
Dividends 29,767 30,646 31,356
Interest 301 293 329
Net appreciation 100,418 107,390 31,952
- -------------------------------------------------------------------
130,486 138,329 63,637
- -------------------------------------------------------------------
Total Additions 142,339 145,220 77,041
- -------------------------------------------------------------------
Deductions
Distributions to Participants
or Their Beneficiaries
Common stock 22,013 14,184 11,615
Cash 16 5 15
- -------------------------------------------------------------------
22,029 14,189 11,630
Interest Expense 23,965 19,496 24,015
- -------------------------------------------------------------------
Total Deductions 45,994 33,685 35,645
- -------------------------------------------------------------------
Net Increase 96,345 111,535 41,396
Net Assets Available for
Benefits
Beginning of Year 259,007 147,472 106,076
- -------------------------------------------------------------------
End of Year $355,352 259,007 147,472
===================================================================
See Notes to Financial Statements.
11
<PAGE>
- -----------------------------------------------------------------
Statement Of Net Assets Long-Term Stock Savings Plan
Available For Benefits Of Phillips Petroleum Company
TEMPORARY FUND
Thousands of Dollars
--------------------
At December 31 1994 1993
--------------------
Assets
Investments
Commingled fund $499 522
Company Contributions Receivable
Before-tax deposits 35 79
Interest Receivable 2 1
- -----------------------------------------------------------------
Total Assets 536 602
Liabilities
Due to Fund K 536 602
- -----------------------------------------------------------------
Net Assets Available for Benefits $ - -
=================================================================
See Notes to Financial Statements.
12
<PAGE>
- -------------------------------------------------------------------
Statement Of Changes In Net Long-Term Stock Savings Plan
Assets Available For Benefits Of Phillips Petroleum Company
TEMPORARY FUND
Thousands of Dollars
--------------------------------
Years Ended December 31 1994 1993 1992
--------------------------------
Additions
Company Contributions
Before-tax deposits $5,988 6,449 6,501
Investment Income
Interest 17 14 17
- -------------------------------------------------------------------
Total Additions 6,005 6,463 6,518
- -------------------------------------------------------------------
Deductions
Allocation of Deposits and
Earnings to Fund K 6,005 6,463 6,518
- -------------------------------------------------------------------
Net Increase - - -
Net Assets Available for
Benefits
Beginning of Year - - -
- -------------------------------------------------------------------
End of Year $ - - -
===================================================================
See Notes to Financial Statements.
13
<PAGE>
- -----------------------------------------------------------------
Notes To Financial Statements Long-Term Stock Savings Plan
Of Phillips Petroleum Company
Note 1--Plan Description
The following description of the Plan is subject to and qualified
by the more complete information appearing in the Plan document.
The Plan became effective July 1, 1988, and is a defined
contribution plan available to certain employees of Phillips
Petroleum Company and participating subsidiaries (Company).
Generally, any regular employee on the direct dollar payroll of
the Company is eligible to participate, except non-managerial
retail marketing outlet employees.
The Company has a trust agreement with Bankers Trust Company,
280 Park Avenue, New York, New York 10017 (Trustee). Plan
investments are held by the Trustee in the Temporary Fund,
Fund K, Fund L and Fund EP. Temporary Fund investments consist
of specified short-term securities. Funds K, L and EP are
invested primarily in common stock of Phillips Petroleum Company
(Phillips Stock).
Fund L consists of Phillips Stock purchased with the proceeds of
the loans described in Note 2 or with Company contributions. The
Phillips Stock will be allocated to Fund L accounts of eligible
participants. The Plan provides for three types of stock
allocations: semiannual basic allocations, dividend replacement
allocations and supplemental allocations. A basic allocation is
made as of June 30 and December 31 of each year. Prior to 1999,
716,846 shares of stock will be divided among or "allocated to"
the Fund L accounts of eligible participants as of each June 30
and December 31. After 1998 and through the later of 2003 or the
allocation date following the date the second loan is repaid, the
number of shares to be allocated semiannually will be 477,876. A
participant's semiannual basic allocation is based on the ratio
of the participant's Fund K before-tax deposits to all eligible
participants' before-tax deposits for the allocation period (both
net of Fund K withdrawals during the period). If the Company
does not elect to make a special contribution and if eligible
dividends from participants' Fund L or Fund EP accounts are used
to make loan payments, participants will receive a dividend
replacement allocation. The Plan used $12.7 million,
$11.8 million and $10.8 million in dividends from participants'
Fund L and Fund EP accounts and allocated 399,586 shares, 400,290
shares and 434,518 shares in dividend replacement allocations in
1994, 1993 and 1992, respectively. A supplemental allocation
will be made each year-end if all shares released for allocation,
based on loan payment provisions, have not been allocated.
14
<PAGE>
The Company makes contributions to the Plan which, when
aggregated with the Plan's dividends from Funds L and EP and
interest earnings from Fund L, equal the amount necessary to
enable the Plan to make its regularly scheduled payments of
principal and interest due on its loans. The Company may also
elect to make dividend replacement contributions to the Plan, as
an alternative to utilizing the dividends from shares in Fund EP
or allocated shares in Fund L. Finally, the Company may make
contributions to the Plan in the amount necessary to bring the
number of shares of stock released for allocation up to the level
required to complete the basic allocation.
Eligible employees may elect to have their salaries reduced and
before-tax deposits made by the Company on their behalf equal to
one percent of pay. These deposits are held in the Temporary
Fund up to 45 days, and then, with the earnings thereon, are
transferred into the employee's Fund K account. The interest of
participants in each fund is represented by units allocated to
them.
Assets of the Employee Stock Ownership Plan of Phillips Petroleum
Company (ESOP) and the Payroll Stock Ownership Plan of Phillips
Petroleum Company (PAYSOP), which were merged into the Plan on
July 1, 1988, are held in Fund EP.
Participants are always vested in their deposits and amounts
credited to their accounts. Total withdrawals from Funds K, L
and EP may be made upon the occurrence of specified events,
including attainment of age 59 1/2 (after December 31, 1998, for
Funds EP and L) or separation from service. Partial withdrawals
are permitted in cases of specified financial hardship and
certain other cases. For a participant who retires or becomes
totally disabled, distribution will be deferred to a date not
later than February of the year after the year age 70 1/2 is
attained. If the participant dies, distribution to a surviving
spouse beneficiary will be deferred to the second valuation date
prior to the date on which the participant would have attained
age 70 1/2. This deferral is revocable by the participant or the
surviving spouse. Distributions to non-spouse beneficiaries may
be deferred approximately five years.
A participant may elect a direct rollover of the taxable portion
of most distributions to an Individual Retirement Account or
another tax-qualified plan. The taxable portion of any such
distribution that is not rolled over directly will be subject to
20 percent federal withholding.
The Plan is administered by the Long-Term Stock Savings Plan
Committee, the members of which are appointed by the Board of
Directors of Phillips Petroleum Company. Members of the
Committee serve without compensation, but are reimbursed by the
Company for necessary expenditures incurred in the discharge of
their duties. Administrative expenses of the Plan will be paid
15
<PAGE>
by the Trustee from assets of the Plan to the extent allowable by
law, unless paid by the Company. In 1994, 1993 and 1992, the
Trustee made cash payments of $100,000 for administrative expense
to Phillips from Fund EP. Plan administrative expenses of
approximately $402,000, $437,000 and $406,000 were paid by
Phillips to the Trustee in 1994, 1993 and 1992, respectively.
Note 2--Securities Acquisition Loans
The Plan borrowed $250 million and $400 million (Loans) in 1988
and 1990, respectively, and purchased 14,336,918 and 14,159,292
shares of common stock from Phillips Petroleum Company
(Phillips), respectively. The shares are held in a Fund L
suspense account until allocated to eligible participants based
on the provisions of the Plan. At December 31, 1994 and 1993,
the market value of unallocated shares was $598 million and
$583 million, respectively.
The Loans are guaranteed by Phillips. They are being repaid
through contributions made by the Company, dividends on
unallocated and allocated shares and earnings on the short-term
investment of contributions and dividends. Annual installments
of $26 million and $25 million were paid on the 1988 borrowing in
1994 and 1993, respectively.
The $400 million loan is a fifteen-year-term bank loan. Any
participating bank in the syndicate of lenders may cease to
participate on November 30, 2001, by giving not less than 180
days prior notice to the Plan and Phillips. Also, each bank
participating in the loan has the optional right, if the current
directors of Phillips or their approved successors cease to be a
majority of the Board, and upon not less than 90 days' notice, to
cease to participate in the loan. Under the above conditions,
such banks' rights and obligations under the loan agreement must
be purchased by Phillips if not transferred to another bank of
Phillips' choice. Repayment of the loan is scheduled to begin in
1999 with a $30 million installment, increasing each year through
the date of maturity. An early payment of $900 thousand was made
on the loan in 1993. In 1994, the Plan signed an agreement
amending the 15-year-term loan under which $397 million is
outstanding. The amended term loan requires repayment in annual
installments beginning in 1999 and has the same maturity as the
original term loan agreement entered into in 1990, but provides a
lower rate of interest.
During 1994, the Plan signed a $131 million term loan agreement
that was used to refinance the outstanding notes payable issued
in 1988. The notes were redeemed on May 16, 1994. The new term
loan requires repayment in annual installments through the year
1998, matching the maturities of the refinanced notes, but at a
reduced cost. The outstanding balance was $105 million at
December 31, 1994.
16
<PAGE>
The Loans provide for variable interest rates. At December 31,
1994 and 1993, the rates were 5.35 percent and 2.91 percent,
respectively, for the $250 million loan. The rates for the
$400 million loan at December 31, 1994 and 1993, were
6.38 percent and 3.63 percent, respectively.
Note 3--Investments
Phillips Stock is valued at the New York Stock Exchange closing
quoted market price. For commingled funds, cost and market value
are the same.
Note 4--Tax Status
The Internal Revenue Service (IRS) determined on September 27,
1991, that the Plan, as amended through November 9, 1990, is
qualified under Section 401(a) of the Internal Revenue Code of
1986 and the Trust is exempt from federal income tax under
Section 501(a). Subsequent amendments have been adopted, but are
not expected to affect the qualified status of the Plan. A
determination letter application was filed with the IRS in 1994,
with an updated IRS determination letter expected in 1995. The
Committee is not aware of any activity that would affect the
qualified status of the Plan.
17
<PAGE>
- ------------------------------------------------------------------------------
Schedule Of Assets Held For Long-Term Stock Savings Plan Of
Investment Purposes Phillips Petroleum Company
Item 27a EIN 73-0400345, Plan 022
At December 31, 1994
Description of investment Thousands of Dollars
Identity of issue, including maturity date, ----------------------
borrower, lessor, rate of interest, collateral, Historical Current
or similar party par or maturity value Cost Value
- ------------------ -------------------------------- ---------- ---------
Phillips Petroleum 32,954,825 shares of common
Company* stock, $1.25 par value $692,158 1,079,269
Bankers Trust 4,750,734 units of participation
Company* in BT Pyramid Government
Securities Cash Fund 4,751 4,751
- ------------------------------------------------------------------------------
$696,909 1,084,020
==============================================================================
*Party-in-interest
18
<PAGE>
- ------------------------------------------------------------------------------
Schedule Of Reportable Transactions Long-Term Stock Savings Plan Of
Item 27d Phillips Petroleum Company
EIN 73-0400345, Plan 022
Year Ended December 31, 1994
Thousands of Dollars
Total Total --------------------------------
number of number of Gain or
Identity of party purchases sales Value (loss) as a
involved and during the during the Value of of result of
description of asset plan year plan year purchases* sales* transactions
- -------------------- ---------- ---------- ---------- ------ ------------
Bankers Trust
Company General
Employee Benefit
Trust, BT Pyramid
Government
Securities Cash
Fund 194 301 $61,685 64,007 -
- ------------------------------------------------------------------------------
*This is also the current value at time of transaction.
19
<PAGE>
Exhibit 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8, File No. 33-50283) pertaining to the Long-
Term Stock Savings Plan of Phillips Petroleum Company and in the
related Prospectus of our report dated June 27, 1995, with
respect to the financial statements and schedules of the
Long-Term Stock Savings Plan of Phillips Petroleum Company
included in this Annual Report (Form 11-K) for the year ended
December 31, 1994.
/s/ ERNST & YOUNG LLP
-----------------
ERNST & YOUNG LLP
Tulsa, Oklahoma
June 27, 1995
<PAGE>
Exhibit 99(c)
FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the year ended December 31, 1994
------------------------------------
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 33-28669
---------------------------------
RETIREMENT SAVINGS PLAN OF
PHILLIPS PETROLEUM COMPANY
(Full title of the Plan)
PHILLIPS PETROLEUM COMPANY
(Name of issuer of securities)
Bartlesville, Oklahoma 74004
(Address of principal executive office) (Zip code)
<PAGE>
FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
--------------------
Financial statements of the Retirement Savings Plan of Phillips
Petroleum Company, filed as a part of this annual report, are
listed in the accompanying index.
(b) Exhibits
--------
Exhibit 1 Consent of Ernst & Young LLP.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Retirement Savings Plan Committee has duly caused this
annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
RETIREMENT SAVINGS PLAN OF
PHILLIPS PETROLEUM COMPANY
/s/ L. F. Francis
---------------------------------
L. F. Francis
Member
Retirement Savings Plan Committee
June 27, 1995
1
<PAGE>
- -----------------------------------------------------------------
Index To Financial Statements Retirement Savings Plan Of
And Schedule Phillips Petroleum Company
Page
Report of Independent Auditors ............................. 3
Financial Statements
Statement of Net Assets Available for Benefits
at December 31, 1994 ................................... 4
Statement of Net Assets Available for Benefits
at December 31, 1993 ................................... 5
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1994 ................... 6
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1993 ................... 7
Statement of Changes in Net Assets Available for Benefits
for the Year Ended December 31, 1992 ................... 8
Notes to Financial Statements ............................ 9
Supplemental Schedule
Schedule of Assets Held for Investment Purposes at
December 31, 1994 ...................................... 12
2
<PAGE>
- ------------------------------------------------------------------
Report Of Independent Auditors
The Retirement Savings Plan Committee
Retirement Savings Plan of Phillips
Petroleum Company
We have audited the financial statements of the Retirement Savings
Plan of Phillips Petroleum Company (Plan) listed in the
accompanying index to financial statements and schedule. These
financial statements are the responsibility of the Retirement
Savings Plan Committee (Committee). 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 the Committee, 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 listed in the
accompanying index to financial statements and schedule present
fairly, in all material respects, the net assets available for
benefits of the Plan at December 31, 1994 and 1993, and the
changes in net assets available for plan benefits for each of the
three years in the period ended December 31, 1994, in conformity
with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying
supplemental schedule of assets held for investment purposes as of
December 31, 1994, is presented for purposes of complying with the
Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of
1974, and is not a required part of the basic financial
statements. The supplemental schedule has been subjected to the
auditing procedures applied in our audit of the 1994 financial
statements and, in our opinion, is fairly stated in all material
respects in relation to the 1994 basic financial statements taken
as a whole.
/s/ ERNST & YOUNG LLP
-----------------
ERNST & YOUNG LLP
Tulsa, Oklahoma
June 27, 1995
3
<PAGE>
- --------------------------------------------------------------------
Statement Of Net Assets Retirement Savings Plan Of
Available For Benefits Phillips Petroleum Company
At December 31, 1994
Fixed Temporary
Investment Stock Investment
Total Fund Fund Fund
--------------------------------------------
Assets
Investments
Insurance contract $10,120,816 10,120,816 - -
Common stock 592,185 - 592,185 -
Money market fund 18,332 - 8,653 9,679
- --------------------------------------------------------------------
10,731,333 10,120,816 600,838 9,679
Cash 201 - 101 100
Interest Receivable 66 - 38 28
Employee Deposits
Receivable 10,123 - - 10,123
Employer Contributions
Receivable 22,971 22,971 - -
Interfund Receivable
(Payable) - 19,272 658 (19,930)
- --------------------------------------------------------------------
Total Assets 10,764,694 10,163,059 601,635 -
Liabilities
Cash Distributions
Payable 85,861 85,861 - -
- --------------------------------------------------------------------
Net Assets Available
for Benefits $10,678,833 10,077,198 601,635 -
====================================================================
Number of Units 2,685,477 139,758
Unit Values $3.7525 4.3048
- --------------------------------------------------------------------
See Notes to Financial Statements.
4
<PAGE>
- --------------------------------------------------------------------
Statement Of Net Assets Retirement Savings Plan Of
Available For Benefits Phillips Petroleum Company
At December 31, 1993
Fixed Temporary
Investment Stock Investment
Total Fund Fund Fund
--------------------------------------------
Assets
Investments
Insurance contract $11,502,213 11,502,213 - -
Common stock 538,994 - 538,994 -
Money market fund 15,186 - 6,185 9,001
- --------------------------------------------------------------------
12,056,393 11,502,213 545,179 9,001
Cash 201 - 100 101
Interest Receivable 32 - 15 17
Employee Deposits
Receivable 9,229 - - 9,229
Employer Contributions
Receivable 22,809 22,809 - -
Interfund Receivable
(Payable) - 17,467 881 (18,348)
- --------------------------------------------------------------------
Total Assets 12,088,664 11,542,489 546,175 -
Liabilities
Cash Distributions
Payable 202,891 202,891 - -
- --------------------------------------------------------------------
Net Assets Available
for Benefits $11,885,773 11,339,598 546,175 -
====================================================================
Number of Units 3,296,259 148,835
Unit Values $3.4401 3.6697
- --------------------------------------------------------------------
See Notes to Financial Statements.
5
<PAGE>
- ----------------------------------------------------------------------
Statement Of Changes In Net Retirement Savings Plan Of
Assets Available For Benefits Phillips Petroleum Company
Year Ended December 31, 1994
Fixed Temporary
Investment Stock Investment
Total Fund Fund Fund
--------------------------------------------
Additions
Contributions and Deposits
Participating Employer
contributions $ 283,224 283,224 - -
Employee deposits 118,472 - - 118,472
- ----------------------------------------------------------------------
401,696 283,224 - 118,472
- ----------------------------------------------------------------------
Investment Income
Interest 683,550 683,081 186 283
Dividends 20,727 - 20,727 -
Net appreciation 70,999 - 70,999 -
- ----------------------------------------------------------------------
775,276 683,081 91,912 283
- ----------------------------------------------------------------------
Total Additions 1,176,972 966,305 91,912 118,755
- ----------------------------------------------------------------------
Deductions
Cash Withdrawals and
Distributions 2,380,787 2,380,787 - -
Forfeitures 3,125 3,125 - -
- ----------------------------------------------------------------------
Total Deductions 2,383,912 2,383,912 - -
- ----------------------------------------------------------------------
Allocation of Deposits
and Earnings - 113,788 4,967 (118,755)
- ----------------------------------------------------------------------
Interfund Transfers - 41,419 (41,419)
- ----------------------------------------------------------------------
Net Increase (Decrease) (1,206,940) (1,262,400) 55,460 -
Net Assets Available
for Benefits
Beginning of Year 11,885,773 11,339,598 546,175 -
- ----------------------------------------------------------------------
End of Year $10,678,833 10,077,198 601,635 -
======================================================================
See Notes to Financial Statements.
6
<PAGE>
- ----------------------------------------------------------------------
Statement Of Changes In Net Retirement Savings Plan Of
Assets Available For Benefits Phillips Petroleum Company
Year Ended December 31, 1993
Fixed Temporary
Investment Stock Investment
Total Fund Fund Fund
--------------------------------------------
Additions
Contributions and Deposits
Participating Employer
contributions $ 529,518 529,518 - -
Employee deposits 109,001 - - 109,001
- ----------------------------------------------------------------------
638,519 529,518 - 109,001
- ----------------------------------------------------------------------
Investment Income
Interest 814,891 814,493 211 187
Dividends 20,364 - 20,364 -
Net appreciation 66,240 - 66,240 -
- ----------------------------------------------------------------------
901,495 814,493 86,815 187
- ----------------------------------------------------------------------
Total Additions 1,540,014 1,344,011 86,815 109,188
- ----------------------------------------------------------------------
Deductions
Cash Withdrawals and
Distributions 927,850 927,850 - -
Forfeitures 5,600 5,600 - -
- ----------------------------------------------------------------------
Total Deductions 933,450 933,450 - -
- ----------------------------------------------------------------------
Allocation of Deposits
and Earnings - 105,952 3,236 (109,188)
- ----------------------------------------------------------------------
Net Increase 606,564 516,513 90,051 -
Net Assets Available
for Benefits
Beginning of Year 11,279,209 10,823,085 456,124 -
- ----------------------------------------------------------------------
End of Year $11,885,773 11,339,598 546,175 -
======================================================================
See Notes to Financial Statements.
7
<PAGE>
- ----------------------------------------------------------------------
Statement Of Changes In Net Retirement Savings Plan Of
Assets Available For Benefits Phillips Petroleum Company
Year Ended December 31, 1992
Fixed Temporary
Investment Stock Investment
Total Fund Fund Fund
--------------------------------------------
Additions
Contributions and Deposits
Participating Employer
contributions $ 250,828 250,828 - -
Employee deposits 110,645 - - 110,645
- ----------------------------------------------------------------------
361,473 250,828 - 110,645
- ----------------------------------------------------------------------
Investment Income
Interest 842,893 842,385 265 243
Dividends 19,609 - 19,609 -
Net appreciation 18,935 - 18,935 -
- ----------------------------------------------------------------------
881,437 842,385 38,809 243
- ----------------------------------------------------------------------
Total Additions 1,242,910 1,093,213 38,809 110,888
- ----------------------------------------------------------------------
Deductions
Cash Withdrawals and
Distributions 402,225 402,225 - -
Forfeitures 9,560 9,560 - -
- ----------------------------------------------------------------------
Total Deductions 411,785 411,785 - -
- ----------------------------------------------------------------------
Allocation of Deposits
and Earnings - 107,125 3,763 (110,888)
- ----------------------------------------------------------------------
Interfund Transfers - 5,773 (5,773) -
- ----------------------------------------------------------------------
Net Increase 831,125 794,326 36,799 -
Net Assets Available
for Benefits
Beginning of Year 10,448,084 10,028,759 419,325 -
- ----------------------------------------------------------------------
End of Year $11,279,209 10,823,085 456,124 -
======================================================================
See Notes to Financial Statements.
8
<PAGE>
- -----------------------------------------------------------------
Notes To Financial Statements Retirement Savings Plan Of
Phillips Petroleum Company
Note 1--Plan Description
The following description of the Retirement Savings Plan of
Phillips Petroleum Company (Plan) is subject to and qualified by
the more complete information appearing in the Plan document.
The Plan was known as the Retirement Savings Plan of Phillips
Petroleum Company Subsidiaries until December 7, 1994.
The Plan is a defined contribution plan sponsored by Phillips
Petroleum Company (Company) for any subsidiary or division which
the Company approves for participation in the Plan and which has
adopted and become a party to the Plan for the current
participation of their active employees (Participating Employer).
For the three-year period ending December 31, 1994, Phillips
Driscopipe, Inc. (with respect to hourly employees only) was the
only Participating Employer.
Other subsidiaries or divisions having present or former
employees holding interests in the Plan are Catalyst Resources,
Inc. (sold March 30, 1994), Drilling Specialties Company,
Phillips Coal Company, and Phillips Uranium Corporation (now
liquidated).
Generally, an employee of a Participating Employer becomes a
participant after completing a six-month period of service of 500
or more hours. Participation in the Plan by each eligible
employee is mandatory. Although not required to do so, a
participant may make deposits, in whole percentages, ranging from
1 to 10 percent of his regular monthly earnings. A participant
may elect to change his deposit rate once each six months. The
Participating Employer or the Company contributes an amount equal
to 5 percent of a participant's regular monthly earnings.
Deposits and contributions are placed in a Trust fund which is
administered by WestStar Bank, Bartlesville, Oklahoma (Trustee).
The Trust fund consists of the Stock Fund, the Fixed Investment
Fund and the Temporary Investment Fund. Investments for each
fund are as follows: Stock Fund (common stock of the Company);
Fixed Investment Fund (an insurance contract with The Travelers
Insurance Company under which Travelers guarantees repayment of
the principal paid to it and a minimum effective rate of interest
thereon) and Temporary Investment Fund (specified short-term
securities). The interest of participants in each fund is
represented by units allocated to them. Unit values reflected in
the accompanying statements are based on aggregate fund values
and aggregate units.
9
<PAGE>
Participant deposits are placed first in the Temporary Investment
Fund for about 30 days. Deposits and earnings thereon are then
paid into the Stock Fund or the Fixed Investment Fund as directed
by the participant. Participants may direct that their deposits
be invested entirely in either the Stock Fund or Fixed Investment
Fund or allocated between them in multiples of 10 percent. No
investment directions may be made with respect to Participating
Employer contributions, all of which are invested only in the
Fixed Investment Fund. Investment directions may be changed once
each year.
The Plan allows limited transfers between the Stock Fund and the
Fixed Investment Fund.
A participant's interest in his own deposits is vested at all
times. His interest in Participating Employer contributions
becomes fully vested on the earliest of the following dates:
(a) upon attainment of age 65 or upon his normal retirement;
(b) upon completing five years of vesting service; (c) upon his
death; (d) upon becoming totally disabled; (e) upon being laid
off for lack of work; (f) upon termination or partial termination
of the Plan or discontinuance of Participating Employer
contributions; or (g) upon certain other events.
Partial vesting takes place in one year increments, with complete
vesting after five years of vesting service. A participant who
has made deposits may withdraw any amount attributable to those
deposits. Withdrawals of deposits may be made only once each six
months. Suspensions of three and six months apply for partial
and complete withdrawals, respectively.
A participant's interest in the contributions of a Participating
Employer becomes available for distribution upon specified
events, including separation from service or retirement.
Termination of employment will result in forfeiture of
Participating Employer contributions if a participant's interest
attributable to those Participating Employer contributions is not
vested. A participant who retires may elect a special deferral
to a date no later than the February valuation date following the
year of attainment of age 70 1/2.
Distributions from the Fixed Investment Fund are in cash while
those from the Stock Fund are in whole shares of the Company's
common stock plus cash for fractional shares unless the
participant directs that the distribution be wholly or partially
in cash. Distribution in the form of an annuity is also
available, as set forth in the Plan.
In the event of termination of the Plan, participants and
beneficiaries of deceased participants will be vested with
respect to, and will receive, within a reasonable time, any funds
in their accounts as of the date of the termination.
10
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The Plan is administered by the Retirement Savings Plan
Committee, a Plan Financial Administrator and a Plan Benefits
Administrator. The members of the Committee are appointed by the
Board of Directors of the Company. The Committee has power to
interpret the Plan and the Plan Benefits Administrator has the
authority to determine eligibility for benefits. Brokerage fees,
commissions, stock transfer taxes and other charges and expenses
incurred in connection with the purchase or sale of securities
are paid by the Plan. The cost of administering the Plan is
shared by the Participating Employers on a mutually agreeable
basis.
Note 2--Investments
Common stock of the Company is valued at the closing quoted
market price on the valuation date. The value of the insurance
contract represents contributions plus interest credited less
distributions. The money market fund is valued at the current
redemption price determined by the Trustee.
Note 3--Tax Status
The Internal Revenue Service (IRS) determined on August 15, 1986,
that the Plan, as amended through October 28, 1985, is qualified
under Section 401(a) of the Internal Revenue Code of 1986 and the
Trust is exempt from federal income tax under Section 501(a).
Subsequent amendments have been adopted, but are not expected to
affect the qualified status of the Plan. A determination letter
application was filed with the IRS in 1994, with an updated IRS
determination expected in 1995. The Committee is not aware of
any activity that would affect the qualified status of the Plan.
Note 4--Additional Company Contributions
In accordance with the Plan document and Treasury regulations,
the Company made additional contributions totaling $258,745 to
the Plan in 1993 related to Plan years 1987, 1988 and 1989.
These contributions were required by retroactive application of
new requirements under Internal Revenue Code Section 414(s),
which provides rules for nondiscrimination in the definition of
plan compensation. The change in the definition of compensation
resulted in additional benefits and additional required
contributions.
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- --------------------------------------------------------------------------------
Schedule Of Assets Held Retirement Savings Plan Of
For Investment Purposes Phillips Petroleum Company
Item 27a EIN 73-0400345, Plan 010
At December 31, 1994
Description of investment
Identity of issue, including maturity date,
borrower, lessor, rate of interest, collateral, Historical Current
or similar party par or maturity value Cost Value
- -------------------- ------------------------------ ----------- ----------
The Travelers Group Annuity Contract
Insurance Company* GR-10462, deposit
administration fund $10,120,816 10,120,816
Phillips Petroleum 18,082 shares of common stock,
Company* $1.25 par value 297,997 592,185
WestStar Bank* 18,332 units of participation
in the Shearson Treasury
Trust Fund, a money market
fund 18,332 18,332
- ------------------------------------------------------------------------------
$10,437,145 10,731,333
==============================================================================
*Party-in-interest
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Exhibit 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8, File No. 33-28669) pertaining to the
Retirement Savings Plan of Phillips Petroleum Company and in the
related Prospectus of our report dated June 27, 1995, with respect
to the financial statements and schedule of the Retirement Savings
Plan of Phillips Petroleum Company included in this Annual Report
(Form 11-K) for the year ended December 31, 1994.
/s/ ERNST & YOUNG LLP
-----------------
ERNST & YOUNG LLP
Tulsa, Oklahoma
June 27, 1995
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