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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 11-K
ANNUAL REPORT
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
(Mark One):
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the plan year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number 1-8059
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
GETTY PETROLEUM CORP.
125 Jericho Turnpike
Jericho, New York 11753
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<PAGE>
REQUIRED INFORMATION
Financial Statements, Supplemental Schedules and Exhibits as follows:
1. Financial Statements:
Report of Independent Accountants
Statements of Net Assets Available for Plan
Benefits as of December 31, 1995 and 1994
Statement of Changes in Net Assets Available for
Plan Benefits for the year ended December 31, 1995
Notes to Financial Statements
Supplemental Schedules:
Schedule of Assets Held for Investment Purposes as
of December 31, 1995
Schedule of Reportable Transactions for the year
ended December 31, 1995
2. Exhibits: None
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Administrator of the Plan has duly caused this annual report to be signed on
its behalf by the undersigned, hereunto duly authorized.
GETTY PETROLEUM CORP.
RETIREMENT AND
PROFIT SHARING PLAN
Dated: June 20, 1996
By: Getty Petroleum Corp.
Retirement Plan Committee
Plan Administrator
By: /s/ Leo Liebowitz
-------------------------
Leo Liebowitz
By: /s/ Milton Safenowitz
-------------------------
Milton Safenowitz
By: /s/ Samuel M. Jones
-------------------------
Samuel M. Jones
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<PAGE>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Financial Statements
as of December 31, 1995 and 1994
and for the year ended December 31, 1995
<PAGE>
INDEX TO FINANCIAL STATEMENTS
-----------------------------
PAGE
-------
Report of Independent Accountants 2 - 3
Financial Statements:
Statements of Net Assets Available for Plan Benefits
as of December 31, 1995 and 1994 4
Statement of Changes in Net Assets Available for Plan
Benefits for the year ended December 31, 1995 5
Notes to Financial Statements 6 - 10
Supplemental Schedules:
Schedule G (Form 5500), Part I - Schedule of Assets Held
for Investment Purposes as
of December 31, 1995 *
Schedule G (Form 5500), Part V - Schedule of Reportable
Transactions for the year
ended December 31, 1995 *
*Refer to Schedule G of Form 5500 (Annual Return/Report of Employee Benefit
Plan) for the plan year ended December 31, 1995 which material is incorporated
herein by reference.
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<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
---------------------------------
To the Retirement Committee of the Getty Petroleum
Corp. Retirement and Profit Sharing Plan:
We have audited the financial statements of the Getty Petroleum Corp.
Retirement and Profit Sharing Plan, as listed in the accompanying index on
page 1. These financial statements are the responsibility of the plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for plan benefits
as of December 31, 1995 and 1994, and the changes in net assets available for
plan benefits for the year ended December 31, 1995, 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 supplemental schedules, as listed
in the accompanying index on page 1, are presented for the purpose of
additional analysis and are not a required part of the basic financial
statements but are supplementary information required by the Department of
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<PAGE>
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The fund information in the
statements of net assets available for plan benefits and the statement of
changes in net assets available for plan benefits is presented for purposes of
additional analysis rather than to present the net assets available for plan
benefits and changes in net assets available for plan benefits of each fund.
The supplemental schedule and fund information have been subjected to the
auditing procedures applied in the audit of the basic financial statements
and, in our opinion, are fairly stated in all material respects in relation to
the basic financial statements taken as a whole.
Coopers & Lybrand L.L.P.
New York, New York
June 4, 1996.
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<PAGE>
<TABLE>
<CAPTION>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Statements of Net Assets Available for Plan Benefits
as of December 31, 1995
(in thousands)
1995
-------------------------------------------------------------------------------------------------------
Fund A Fund B Fund C Fund D Fund E Fund F Fund G Loans In-Transit Total
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments, at fair
value (Note 3) $14,899 $1,604 $1,511 $55 $52 $77 $174 $ - $ - $18,372
Employee loans - - - - - - - 139 - 139
Contributions
receivable:
Employer 119 19 17 2 4 8 7 - - 176
Employee 81 9 9 - 2 5 2 - - 108
------- ------ ------ ------ ------ ------ ------ ------ ------ -------
200 28 26 2 6 13 9 - - 284
Cash - - 1 - - - - - 22 23
------- ------ ------ ------ ------ ------ ------ ------ ------ -------
Net assets available
for plan benefits $15,099 $1,632 $1,538 $57 $58 $90 $183 $139 $22 $18,818
======= ====== ====== ====== ====== ====== ===== ====== ====== ========
</TABLE>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Statements of Net Assets Available for Plan Benefits
as of December 31, 1994
(in thousands)
1994
-------------------------------------
Fund A Fund B Fund C Total
- ------------------------------------------------------------------
Assets:
Investments, at fair
value (Note 3) $14,995 $1,214 $1,320 $17,529
Employee loans - - - -
Contributions
receivable:
Employer 118 8 14 140
Employee 78 7 8 93
------ ------ ------ ------
196 15 22 233
Cash - - 1 1
------ ------ ------ ------
Net assets available
for plan benefits $15,191 $1,229 $1,343 $17,763
======= ====== ====== =======
See accompanying notes.
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<TABLE>
<CAPTION>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Statement of Changes in Net Assets Available for Plan Benefits
for the year ended December 31, 1995
(in thousands)
Fund A Fund B Fund C Fund D Fund E Fund F Fund G Loans In-Transit Total
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Contributions:
Employer $352 $44 $44 $2 $7 $20 $11 $ - $ - $480
Employee 793 84 81 2 8 25 8 - - 1,001
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
1,145 128 125 4 15 45 19 - - 1,481
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Rollovers 3 - - - - - - - - 3
Investment income:
Interest and dividend
income 1,085 49 4 3 3 2 4 6 3 1,159
Net appreciation of
investments - 330 200 - - 1 9 - - 540
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
1,085 379 204 3 3 3 13 6 3 1,699
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Transfers from (to)
other funds, net (197) (104) (134) 50 40 42 151 133 19 -
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Withdrawals (2,128) - - - - - - - - (2,128)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net additions (reductions) (92) 403 195 57 58 90 183 139 22 1,055
Net assets available for
plan benefits as of
January 1, 1995 15,191 1,229 1,343 - - - - - - 17,763
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net assets available for
plan benefits as of
December 31, 1995 $15,099 $1,632 $1,538 $57 $58 $90 $183 $139 $22 $18,818
======= ====== ====== ====== ====== ====== ====== ====== ====== =======
See accompanying notes.
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</TABLE>
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GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Notes to Financial Statements
1. Description of Plan
-------------------
The following brief description of the Getty Petroleum Corp. Retirement
and Profit Sharing Plan (the "Plan") is provided for general information
purposes only. Participants should refer to the Plan Agreement for more
complete information.
The Plan is a defined contribution plan covering all employees age
twenty-one and older of Getty Petroleum Corp. (the "Company"), who have
completed one year of service, except those covered by a collective bargaining
agreement or other retirement plan sponsored by the Company. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of
1974 (ERISA). In 1987, the Plan was amended to provide for the benefits
available under Section 401(k) of the Internal Revenue Code.
Employees may make voluntary contributions to the Plan in an amount up to
6% of their compensation and the Company matches an amount equal to 50% of
such employee contributions. Under the Plan, employees may make additional
contributions amounting to 9% of compensation which are not matched by the
Company. The Company may also make a profit sharing contribution to the Plan
at the discretion of the Company's Board of Directors.
Contributions to the Plan may be invested in seven available investment
funds allocated in multiples of 5% at the election of the employee as follows:
Fund A, The Fixed Income Investment Fund, consists primarily of fixed
income obligations of Massachusetts Mutual Life Insurance Company
("Massachusetts Mutual") and, accordingly, is subject to its credit worthiness
(Massachusetts Mutual has been rated A++ by A.M. Best Company and Aa1 by
Moody's Investors Service). Massachusetts Mutual maintains the contributions
and related accumulated investment earnings in an unallocated fund which earns
interest at a minimum guaranteed rate of return which is revised at the
beginning of each contract year (7.45% and 7.5% average interest rates for the
years ended December 31, 1995 and 1994, respectively).
Fund B, The Core Equity Fund, holds units in the MassMutual Value Equity
Fund, a MassMutual Institutional Fund, which invests in stocks of large U.S.
companies. Massachusetts Mutual maintains the contributions and related
accumulated investment earnings in a pooled separate investment account which
is not guaranteed as to either principal or a stated rate of investment
return.
Fund C, The Getty Petroleum Corp. Common Stock Fund, consists entirely of
common stock of the Company and is not guaranteed as to either principal or a
stated rate of investment return. The Fund is administered by the Company.
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<PAGE>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Notes to Financial Statements, Continued
Funds D through G are four Destiny Asset Allocation Funds which were
added to the Plan in April 1995. Each of the Destiny Funds, namely,
Conservative, Moderate, Aggressive, and All Equity has its own investment
strategy and risk characteristics. The Destiny Funds are pooled separate
investment accounts and are managed by Massachusetts Mutual by allocating the
investments of each Fund, within targeted ranges, among a series of six
MassMutual Institutional Funds. The MassMutual Institutional Funds include an
international stock fund, a small U.S. stock fund, a large U.S. stock fund, an
intermediate bond fund, a short-term bond fund and a cash fund. The Destiny
Funds are not guaranteed as to either principal or a stated rate of return.
Fund D, The Conservative Fund, is invested primarily in domestic common
stocks, publicly traded bonds and short-term interest bearing investments with
a focus on income and capital preservation.
Fund E, The Moderate Fund, invests primarily in domestic and foreign
common stocks, including small capitalization common stocks, publicly traded
bonds and short-term interest bearing investments with a focus on achieving
growth through a balance of income and capital appreciation.
Fund F, The Aggressive Fund, invests primarily in domestic and foreign
common stocks, including small capitalization common stocks, publicly traded
bonds and short-term interest bearing investments with a focus on capital
appreciation.
Fund G, The All Equity Fund, invests primarily in domestic and foreign
common stocks, including small capitalization common stocks.
Under a loan provision, which became effective in April 1995, employees
are permitted to borrow between $500 and the lesser of $50,000 or 50% of the
participant's vested account balance for personal reasons reflecting important
financial needs. The interest rate charged is fixed at the prime rate in
effect at the beginning of the month the loan is requested plus 1% and
repayment is made by payroll deduction. The employee is charged a $75 loan
initiation fee for each loan from the Plan. Loans are required to be repaid
over a maximum period of five years, unless the loan is used to purchase a
principal residence, in which case the maximum period is fifteen years. Loans
may not be repaid before their maturity date. However, all loans must be
repaid upon cessation of employment and, if not repaid within 90 days, the
unpaid balance of principal and interest is charged against the participant's
vested account balance.
Employees are only permitted to withdraw deferred cash contributions made
to the Plan subsequent to October 1, 1987 under the provisions of Section
401(k) of the Internal Revenue Code for "financial hardships", as defined by
the Internal Revenue Code. Employees may withdraw their voluntary
contributions, including the vested portion of employer matching
contributions, once per calendar year, although they will be subject to
certain suspension periods with respect to making future
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<PAGE>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Notes to Financial Statements, Continued
contributions. Employees may withdraw all or part of their account balances
attributable to additional and rollover contributions without penalty.
Rollover contributions cannot be withdrawn unless they have been in the Plan
for a minimum of two years. Profit sharing contributions may not be withdrawn
while the employee is employed by the Company.
Employee contributions (including related accumulated investment
earnings) are 100% vested. Employer contributions (including related
accumulated investment earnings) vest in accordance with the following
schedule:
Years of Service Percent Vested
---------------- --------------
2 years 20%
3 years 40
4 years 60
5 years 80
6 or more years 100
Upon termination of employment, the non-vested portion of employer
contributions, if any, will be forfeited by the employee and applied to reduce
the Company's future contributions.
2. Summary of significant accounting policies
------------------------------------------
The accompanying financial statements have been prepared in accordance
with generally accepted accounting principles and include estimated amounts.
While all available information has been considered, actual amounts could
differ from those estimates.
The investments in the Fixed Income Investment Fund, the Core Equity Fund
and the Destiny Asset Allocation Funds are stated at current fair value as
reported by Massachusetts Mutual using quoted market prices or good faith
estimates if quoted market prices are not available. The Employer Common
Stock Fund is valued at published market prices.
The Plan presents in the Statement of Changes in Net Assets Available for
Plan Benefits the net appreciation (depreciation) in the fair value of
investments, which consists of the realized gains (losses) and the unrealized
appreciation (depreciation) on those investments.
Under the terms of the Plan, the Company has elected to pay the
administrative expenses of the Plan.
-8-
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Notes to Financial Statements, Continued
3. Investments
-----------
The following summarizes the Plan's investments as of December 31, 1995
and 1994 (in thousands):
1995 1994
----------------------- ----------------------
Historical Historical
Fair Value Cost Fair Value Cost
- ------------------------------------------------------------------------------
Fund A:
Fixed Income Investment
Fund (*) $14,899 $14,899 $14,995 $14,995
Fund B:
Core Equity
Fund (*) 1,604 997 1,214 864
Fund C:
Getty Petroleum Corp.,
Common Stock,
$.10 par value (**) 1,511 1,703 1,320 1,722
Fund D:
Destiny Asset Allocation
Fund - Conservative (*) 55 52 - -
Fund E:
Destiny Asset Allocation
Fund - Moderate (*) 52 50 - -
Fund F:
Destiny Asset Allocation
Fund - Aggressive (*) 77 73 - -
Fund G:
Destiny Asset Allocation
Fund - All Equity (*) 174 161 - -
------- ------- ------- -------
$18,372 $17,935 $17,529 $17,581
======= ======= ======= =======
(*)Fair value determined by Massachusetts Mutual.
-9-
<PAGE>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
Notes to Financial Statements, Continued
(**) The market value of the Company's common stock was $13.375 per share and
$11.625 per share as of December 31, 1995 and 1994, respectively. As of June
4, 1996, the market value of the Company's common stock was $14.00 per share.
4. Termination Priorities
----------------------
While the Company has not expressed any intent to discontinue its
contributions, the Board of Directors of the Company is free to do so at any
time, subject to the requirements of ERISA. In the event such discontinuance
results in the termination of the Plan, the net assets of the Plan will be
distributed to the participants and beneficiaries of the Plan under the terms
of the Plan.
5. Income Tax Status
-----------------
In 1993, the Internal Revenue Service informed the Company that the Plan
was a qualified plan under Section 401(a) of the Internal Revenue Code. Since
that date, the Plan has been amended to provide for participant loans and
additional investment options. Although the Plan has not reapplied for
qualification, the Plan continues to believe that it is not subject to federal
income taxes.
6. Reconciliation to Form 5500
---------------------------
In accordance with generally accepted accounting principles, the Plan has
not recorded a liability for amounts allocated to participants who have
withdrawn from the Plan and for which disbursement of those funds has not been
made by year end. The Department of Labor requires the recording of a
liability for benefit claims payable in Form 5500. As of December 31, 1995
and 1994, the benefit claims payable recorded on the Form 5500 for employees
who have elected to withdraw from the Plan was $- and $281,692, respectively.
7. Proposed Spin-off
-----------------
On March 13, 1996, the Company announced that it intends to spin-off its
petroleum marketing business to its shareholders on a tax-free basis. The
Company would retain its real estate business and lease most of its properties
on a long-term net basis to the new company, which will be called "Getty
Petroleum Marketing Inc." Getty Petroleum Corp. would change its name to
"Getty Realty Corp."
The spin-off is subject to obtaining a favorable tax ruling from the
Internal Revenue Service. The proposed transaction is expected to be
completed later this year. Each shareholder of Getty Petroleum Corp. would
receive a pro rata share of Getty Petroleum Marketing Inc. for each share of
Getty Petroleum Corp. The exchange ratio has not yet been determined.
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SUPPLEMENTAL SCHEDULES
<PAGE>
<TABLE>
<CAPTION>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
1995 FORM 5500
SCHEDULE G - PART V - SCHEDULE OF REPORTABLE
TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1995
(in thousands)
(a) (b) (c) (d) (e) (f) (g) (h) (i)
- ------------------------------------------------------------------------------------------------------------------------------------
CURRENT
EXPENSE VALUE OF ASSET
IDENTITY OF DESCRIPTION OF PURCHASE SELLING LEASE INCURRED WITH COST OF ON TRANSACTION NET GAIN
PARTY INVOLVED ASSET PRICE PRICE RENTAL TRANSACTION ASSET DATE OR (LOSS)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MASSACHUSETTS DEPOSITS AND TRANSFERS
MUTUAL LIFE INTO THE FIXED INCOME $3,193 $3,193
INSURANCE COMPANY INVESTMENT FUND
MASSACHUSETTS DISBURSEMENTS AND
MUTUAL LIFE TRANSFERS OUT OF $4,374 $4,374 $4,374
INSURANCE COMPANY THE FIXED INCOME
INVESTMENT FUND
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GETTY PETROLEUM CORP.
RETIREMENT AND PROFIT SHARING PLAN
1995 FORM 5500
SCHEDULE G - PART I - SCHEDULE OF ASSETS HELD FOR
INVESTMENT PURPOSES AS OF DECEMBER 31, 1995
(in thousands)
(a) (b) (c) (d) (e)
- ------------------------------------------------------------------------------------------
DESCRIPTION OF INVESTMENT
INCLUDING MATURITY DATE,
IDENTITY OF ISSUE, BORROWER, RATE OF INTEREST, COLLATERAL, CURRENT
LESSOR, OR SIMILAR PARTY PAR, OR MATURITY VALUE COST VALUE
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 (*) MASSACHUSETTS MUTUAL LIFE FIXED INCOME INVESTMENT
INSURANCE COMPANY FUND $14,899 $14,899
2 (*) MASSACHUSETTS MUTUAL LIFE CORE EQUITY FUND
INSURANCE COMPANY $997 $1,604
3 (*) GETTY PETROLEUM CORP. COMMON STOCK,
$.10 PAR VALUE $1,703 $1,511
4 (*) MASSACHUSETTS MUTUAL LIFE DESTINY ASSET ALLOCATION
INSURANCE COMPANY FUND - CONSERVATIVE $52 $55
5 (*) MASSACHUSETTS MUTUAL LIFE DESTINY ASSET ALLOCATION
INSURANCE COMPANY FUND - MODERATE $50 $52
6 (*) MASSACHUSETTS MUTUAL LIFE DESTINY ASSET ALLOCATION
INSURANCE COMPANY FUND - AGGRESSIVE $73 $77
7 (*) MASSACHUSETTS MUTUAL LIFE DESTINY ASSET ALLOCATION
INSURANCE COMPANY FUND - ALL EQUITY $161 $174
8 (*) PARTICIPANT LOANS LOANS TO PLAN PARTICIPANTS
WITH MATURITY DATES THROUGH
2010, BEARING INTEREST
FROM 9.75 % TO 10.0 % AND SECURED
BY THE PARTICIPANT'S VESTED
ACCOUNT BALANCE $ - $139
(*) DENOTES PARTY IN INTEREST.
</TABLE>
