Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x☒ No ¨☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 ofRegulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x☒ No ¨☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨☐ No x☒

As of ~~July 15, 2016,~~January 17, 2017, there were 100 shares of common stock, par value $.10 per share, of the Registrant outstanding.


	May 31, 2016 (Unaudited)			August 31, 2015			November 30, 2016 (Unaudited)			August 31, 2016
Assets
Current:
Cash and cash equivalents	$	78,909		$	117,028		$	50,589		$	48,361
Short-term investments								10,188			10,156
Accounts receivable, net		67,324			81,567			60,243			71,504
Refundable income taxes		4,200			—			3,288			3,343
Inventories, net		164,112			206,066			159,936			167,062
Prepaid income taxes		5,147			—			11,004			4,018
Prepaid expenses and other assets		19,368			28,000			19,983			22,092
Amounts due from affiliated companies, net		3,315			393
Amounts due from affiliated companies								189			—

Total current assets		342,375			433,054			315,420			326,536
Property, plant and equipment, net		393,558			347,757			410,080			403,631
Deferred financing costs, net		5,379			2,667
Goodwill		1,349			1,349			1,349			1,349
Tradename		10,500			10,500			10,500			10,500
Amortizable intangible assets, net		839			869			776			807
Deferred integrity and replacement costs, net		116,307			58,634			109,505			112,892
Deferred turnaround costs and other assets, net		21,404			30,636			17,222			18,852

	$	891,711		$	885,466		$	864,852		$	874,567

Liabilities and Stockholder’s Equity
Current:
Current installments of long-term debt	$	28,103		$	1,556		$	28,825		$	28,029
Accounts payable		59,276			44,833			47,044			61,832
Accrued liabilities		16,215			17,911			20,702			21,307
Income taxes payable		—			7,397
Sales, use and fuel taxes payable		22,410			23,373			19,942			21,649
Deferred income taxes		5,822			5,822
Amounts due to affiliated companies								44			729

Total current liabilities		131,826			100,892			116,557			133,546
Long term debt: less current installments		266,710			239,111
Long-term debt, less current installments								271,625			254,498
Deferred income taxes		58,376			55,921			49,870			48,173
Deferred retirement benefits		67,479			71,800			93,354			94,786

Total liabilities		524,391			467,724			531,406			531,003

Commitments and contingencies
Stockholder’s equity:
Common stock; $.10 par value per share – shares authorized 100; issued and outstanding 100		—			—			—			—
Series A Preferred stock; $1,000 par value per share – shares authorized 25,000; issued and outstanding 14,116		14,116			14,116			14,116			14,116
Additional paid-in capital		156,846			156,846			157,316			157,316
Retained earnings		214,581			263,464			198,543			208,495
Accumulated other comprehensive loss		(18,223	)		(16,684	)		(36,529	)		(36,363	)

Total stockholder’s equity		367,320			417,742			333,446			343,564

	$	891,711		$	885,466		$	864,852		$	874,567


	Three Months Ended						Nine Months Ended
	May 31,						May 31,						Three Months Ended November 30,
	2016			2015			2016			2015			2016			2015
Net sales	$	497,982		$	602,877		$	1,511,297		$	2,008,478		$	513,378		$	574,941

Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		395,531			485,906			1,320,134			1,741,703			466,858			504,772
Selling, general and administrative expenses		43,591			42,073			127,690			124,069			43,580			42,589
Depreciation and amortization expenses		12,175			10,444			36,679			31,321			12,252			11,702

		451,297			538,423			1,484,503			1,897,093			522,690			559,063

Operating income		46,685			64,454			26,794			111,385
Operating (loss) income														(9,312	)		15,878

Other expense:
Interest expense, net		(2,383	)		(6,639	)		(9,795	)		(19,929	)		(2,757	)		(5,173	)
Other, net		(254	)		(907	)		(3,195	)		(3,064	)		(370	)		(301	)
Loss on extinguishment of debt		—			—			(19,316	)		—			—			(19,316	)

		(2,637	)		(7,546	)		(32,306	)		(22,993	)		(3,127	)		(24,790	)

Income (loss) before income tax expense (benefit)		44,048			56,908			(5,512	)		88,392
Income tax expense (benefit)		16,307			22,201			(2,045	)		34,468
Loss before income tax benefit														(12,439	)		(8,912	)
Income tax benefit														(4,604	)		(3,300	)

Net income (loss)	$	27,741		$	34,707		$	(3,467	)	$	53,924
Net loss													$	(7,835	)	$	(5,612	)

Consolidated Statements of Comprehensive ~~Income (Loss)~~Loss – (Unaudited)


	Nine Months Ended
	May 31,						Three Months Ended November 30,
	2016			2015			2016			2015
Cash flows from operating activities:
Net (loss) income	$	(3,467	)	$	53,924
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Net loss							$	(7,835	)	$	(5,612	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		37,780			33,163			12,252			11,702
Amortization of debt discount and deferred financing costs								327			466
Deferred income taxes		3,385			23,604			1,794			(5,742	)
Noncash portion of loss on extinguishment of debt		5,771			—			—			5,771
Loss on asset dispositions		840			771			1			27
Cash provided by working capital items		56,947			27,631
Cash (used in) provided by working capital items								(4,409	)		46,995
Change in operating assets and liabilities:
Other assets, net		406			306			169			168
Deferred retirement benefits		(6,790	)		(6,079	)		(1,695	)		(2,627	)

Total adjustments	��	98,339			79,396			8,439			56,760

Net cash provided by operating activities		94,872			133,320			604			51,148

Cash flows from investing activities:
Short-term investments								(32	)		—
Additions to property, plant and equipment		(64,389	)		(31,202	)		(12,662	)		(18,674	)
Additions to amortizable intangible assets		(60	)		(100	)
Additions to deferred turnaround costs		(1,362	)		(3,318	)		(1,262	)		(1,065	)
Additions to deferred integrity and replacement costs		(66,572	)		(28,630	)		—			(53,674	)
Proceeds from asset dispositions		246			7			101			—

Net cash used in investing activities		(132,137	)		(63,243	)		(13,855	)		(73,413	)

Cash flows from financing activities:
Dividends to preferred shareholder and stockholder		(45,416	)		(21,610	)		(2,117	)		(2,117	)
Proceeds from issuance of long-term debt		301,948			—			25,000			250,475
Principal reductions of long-term debt		(251,593	)		(1,245	)		(7,052	)		(237,656	)
Deferred financing costs		(5,793	)		—			(352	)		(4,613	)

Net cash used in financing activities		(854	)		(22,855	)
Net cash provided by financing activities								15,479			6,089

Net (decrease) increase in cash and cash equivalents		(38,119	)		47,222
Net increase (decrease) in cash and cash equivalents								2,228			(16,176	)
Cash and cash equivalents, beginning of year		117,028			99,037			48,361			117,028

Cash and cash equivalents, end of period	$	78,909		$	146,259		$	50,589		$	100,852

Cash provided by (used in) working capital items:
Accounts receivable, net	$	14,243		$	17,690		$	11,261		$	14,903
Refundable income taxes		(4,200	)		(4,912	)		55			(4,200	)��
Inventories, net		41,954			(37,528	)		7,126			51,766
Prepaid income taxes		(5,147	)		13,674			(6,986	)		—
Prepaid expenses and other assets		8,632			45,158			2,109			(13,848	)
Amounts due from affiliated companies, net		(2,922	)		(1,162	)
Amounts due from/to affiliated companies								(874	)		(1,914	)
Accounts payable		14,443			(19,486	)		(14,788	)		2,454
Accrued liabilities		(1,696	)		3,350			(605	)		362
Income taxes payable		(7,397	)		7,646			—			(2,002	)
Sales, use, and fuel taxes payable		(963	)		3,201			(1,707	)		(526	)

Total change	$	56,947		$	27,631		$	(4,409	)	$	46,995

Cash paid during the period for:
Interest	$	9,160		$	12,893		$	2,483		$	3,808
Income taxes	$	11,314		$	396		$	546		$	8,644

Non-cash investing activities:
Property additions & capital leases	$	—		$	285

The consolidated financial statements include the accounts of United Refining Company (“URC”) and its subsidiaries, United Refining Company of Pennsylvania and its subsidiaries and Kiantone Pipeline Corporation and its subsidiary (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation.

The Company is a petroleum refiner and marketer in its primary market area of Western New York and Northwestern Pennsylvania. Operations are organized into two business segments: wholesale and retail.

The wholesale segment is responsible for the acquisition of crude oil, petroleum refining, supplying petroleum products to the retail segment and the marketing of petroleum products to wholesale and industrial customers. The retail segment operates a network of Company operated retail units under the Red Apple Food Mart^® and Country Fair^® brand names selling petroleum products under the Kwik Fill^®, Citgo^® and Keystone^® brand names, as well as convenience and grocery items.

The Company is a wholly-owned subsidiary of United Refining, Inc., a wholly-owned subsidiary of United Acquisition Corp., which in turn is a wholly-owned subsidiary of Red Apple Group, Inc. (the “Parent”).

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three ~~and nine~~ months ended ~~May 31,~~November 30, 2016 are not necessarily indicative of the results that may be expected for the year ending August 31, ~~2016.~~2017. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Form 10-K for the fiscal year ended August 31, ~~2015.~~2016.

In May, 2014, the FASB issued ASU No. 2014-09 “Revenue from Contracts with Customers,” which provides guidance for revenue recognition. The standard’s core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU No. 2015-14 which deferred the effective date of ASU 2014-09. This guidance will now be effective for our financial statements in the annual period beginning after December 15, 2017. We are currently evaluating the effect of adopting this new accounting guidance and do not expect adoption will have a material impact on our financial statements.

In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” which requires debt issuance costs related directly to notes payable be deducted from the face amount of that note and the amortization of such costs be classified as interest expense. Effective November 30, 2016, the Company adopted the accounting and reporting requirements included in ASU 2015-03 and has applied these requirements retrospectively. Accordingly, the Company has included $5,150,000 of previously reported deferred financing cost assets in long-term debt, net of current installments in its August 31, 2016 consolidated balance sheet. The adoption of these accounting and reporting requirements resulted in an increase in interest expense and a decrease in other expense of $327,000 and $275,000 on the consolidated statements of operations for the three months ended November 30, 2016 and 2015, respectively.

In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” (ASU 2016-01”). The standard addresses certain aspects of recognition, measurements, presentation and disclosure of financial instruments. ASU 2016-01 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 and early adoption is not permitted. The Company expects to adopt this guidance when effective and adoption is not expected to have a material effect on the financial statements.

In February 2016, the FASB issued ASU-2016-02 “Leases,” which replaces the existing guidance in Accounting Standards Codification (“ASC”) 840. This new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018 with early adoption permitted. The guidance requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use (ROU) asset and a corresponding lease liability. For finance leases the lessee would recognize interest expense and amortization of the ROU asset and for operating leases the lessee would recognize a straight-line total lease expense. The Company is currently assessing the impact that adoption of this guidance will have on its financial statements and footnote disclosures.

In August 2016, the FASB issued ASU 2016-15 which includes guidance to clarify how companies present and classify certain cash receipts and cash payments in the statement of cash flows, including contingent consideration payments made after a business acquisition and debt extinguishment costs. Specifically, cash payments to settle a contingent consideration liability which are not made soon after the acquisition date should be classified as cash used in financing activities up to the initial amount of contingent consideration recognized with the remaining amount classified as cash flows from operating activities. The guidance is effective for fiscal years and interim periods beginning after December 15, 2017, with early adoption permitted. The Company expects to adopt this guidance when effective and adoption is not expected to have a material effect on the financial statements.

Inventories are stated at the lower of cost or market (LCM), with cost being determined under the Last-in, First-out (LIFO) method for crude oil and petroleum product inventories and the First-in, First-out (FIFO) method for merchandise. Supply inventories are stated at either the LCM or replacement cost and include various parts for the refinery operations.


	May 31, 2016		August 31, 2015		November 30, 2016		August 31, 2016
	(in thousands)				(in thousands)
Crude Oil	$	33,920	$	60,209	$	39,847	$	44,536
Petroleum Products		72,943		92,452		61,198		65,414

Total @ Lower of LIFO Cost or Market		106,863		152,661		101,045		109,950

Merchandise		23,906		24,277		27,379		26,293
Supplies		33,343		29,128		31,512		30,819

Total @ FIFO		57,249		53,405		58,891		57,112

Total Inventory	$	164,112	$	206,066	$	159,936	$	167,062

As of ~~May 31,~~November 30, 2016 and August 31, ~~2015,~~2016, the replacement cost of LIFO inventories ~~(FIFO) (was less than)~~ exceeded their LIFO carrying values ~~(LCM)~~ on the balance sheets by approximately ~~$(5,843,000)~~$3,397,000 and ~~$6,201,000,~~$4,718,000, respectively, which includes the LCM inventory ~~writedown~~write-down of ~~$36,455,000~~$9,540,000 and ~~$0,~~$13,052,000, respectively, and a LIFO increase ~~(decrease)~~ of ~~$42,298,000~~$6,143,000 and ~~$(6,201,000),~~$8,334,000, respectively.

Amended, Restated and Consolidated Revolving Credit, Term Loan and Security Agreement

On October 20, 2015 (the “Closing Date”), URC, United Refining Company of Pennsylvania, Kiantone Pipeline Corporation (“Kiantone”), United Refining Company of New York Inc., United Biofuels, Inc., Country Fair, Inc. and Kwik-Fill Corporation (collectively, the “Borrowers”) entered into an Amended, Restated and Consolidated Revolving Credit, Term Loan and Security Agreement (“Credit Agreement”) with a group of lenders led by PNC Bank, National Association, as Administrative Agent (the “Agent”), and PNC Capital Markets LLC, as Sole Lead Arranger and Bookrunner. The Credit Agreement amends and restates the Amended and Restated Credit Agreement, dated May 18, 2011 and last amended June 18, 2013, by and between the Company and certain subsidiaries and PNC Bank, National Association, as Administrative Agent (the “Existing Credit Facility”). The Credit Agreement will terminate on October 19, 2020 (the “Expiration Date”). Until the Expiration Date, the Company may borrow on the New Revolving Credit Facility (as defined below) on a borrowing base formula set forth in the Credit Agreement.

In addition, pursuant to the Credit Agreement, the Company entered into a term loan in the amount of $250,000,000, which was made in a single drawing on the Closing Date (“Term Loan” and, together with the New Revolving Credit Facility, the “Credit Obligations”). Under the Term Loan, interest is calculated as follows: (a) for domestic rate borrowings, at (i) the greater of the Agent’s prime rate, federal funds rate plus .5% or the daily LIBOR rate plus 1%, plus (ii) an applicable margin of 1.75% to 2.25%, and (b) for euro-rate borrowings, at the LIBOR rate plus an applicable margin of 2.75% to 3.25%. The applicable margin will vary depending on a formula calculating the Company’s average unused availability under the facility. The Term Loan is prepayable in whole or in part at any time without premium or penalty. The Term Loan shall be paid in full on or prior to the Expiration Date and shall be paid in equal quarterly amounts based on a ten-year straight line amortization schedule.

The Credit Obligations are secured by a first priority security interest in certain cash accounts, accounts receivable, inventory, the refinery, including a related tank farm, and the capital stock of Kiantone. At such time as the Term Loan is repaid in full, and provided no event of default exists, the security interest in the refinery and the equity interest in Kiantone shall be released.

The Credit Agreement requires minimum undrawn availability of $15,000,000 at all times prior to the repayment of the Term Loan and the greater of 12.5% of the maximum New Revolving Credit Facility or $25,000,000 after the repayment of the Term Loan. The Company is also required to maintain a consolidated net worth of no less than $100,000,000. The Credit Agreement includes customary mandatory prepayment

provisions, including in connection with non-ordinary course asset sales, equity issuances and the incurrence of additional debt. Unless assets sold in non-ordinary course transactions were included in the borrowing base for the New Revolving Credit Facility, mandatory prepayments shall be applied first to the repayment of the Term Loan and then the New Revolving Credit Facility. The Credit Agreement also includes customary affirmative and negative covenants, including, among other things, covenants related to the fixed charge coverage ratio, payment of fees, conduct of business, maintenance of existence and assets, payment of indebtedness and the incurrence of additional indebtedness, intercompany obligations, affiliate transactions, amendments to organizational documents, and financial statements.

The proceeds of the Credit Agreement were used to (i) repay and satisfy in full those certain 10.500% senior secured notes due 2018 (the “Senior Secured Notes due 2018”), (ii) provide for the Company’s general corporate needs, including working capital requirements and capital expenditures and (iii) pay the fees and expenses associated with the Credit Agreement.

In connection with the redemption of all its Senior Secured Notes due 2018, the Company recorded a loss of $19,316,000 on the early extinguishment of debt consisting of a redemption premium of $7,009,000, a consent payment of $6,536,000, a write-off of unamortized net debt discount of $3,600,000 and a write-off of deferred finance costs of $2,171,000.

On December 9, 2015, United Refining Company of New York Inc. (as Borrower) and United Refining Company of Pennsylvania (as Fee Owner), entered into a Loan Agreement with ~~Signature Bank (as Administrative Agent),~~a bank, in the amount of $50,000,000 which matures on December 9, 2022. Pursuant to the Loan Agreement, interest is calculated as follows: (a) for LIBOR Loans, at either the LIBOR plus 2.50% or the Prime Rate, (b) for Reference Rate Loans, the Prime Rate and (c) for Fixed Rate Loans, at the Fixed Rate. ~~Loans are~~Under the terms of the agreement, the Company will make 84 monthly principal installments of approximately $129,000 with the remaining principal balance due on December 9, 2022. The loan is secured by a first lien mortgage on certain convenience store units owned by United Refining Company of ~~Pennsylvania.~~Pennsylvania and contains various covenants applicable to the Borrower, which include, among others, maintaining a debt service coverage ratio. Payments due under a master lease between URC and the Borrower are guaranteed by the Company. Proceeds of the loan were used for general corporate purposes of the Company.

On October 20, 2016, Kwik-Fil, Inc. (as Borrower) and United Refining Company of Pennsylvania (as Fee Owner), entered into a loan agreement with a bank in the amount of $25,000,000 which matures on October 20, 2023. Pursuant to the loan agreement, interest is calculated as follows: (a) for LIBOR Loans, at either the LIBOR plus 2.50% or the Prime Rate, (b) for Reference Rate Loans, the Prime Rate and (c) for Fixed Rate Loans, at the greater of the Fixed Rate or 4.25% per annum. Under the terms of the agreement, the Company will make 83 monthly principal installments of approximately $83,000 with the remaining principal balance due on October 20, 2023. The loan is secured by a first lien mortgage on certain convenience store units owned by United Refining Company of Pennsylvania and contains various covenants applicable to the Borrower, which

include, among others, maintaining a debt service coverage ratio. Payments due under a master lease between URC and the Borrower are guaranteed by the Company. Proceeds of the loan were used for general corporate purposes of the Company.

Intersegment revenues are calculated using market prices and are eliminated upon consolidation. Summarized financial information regarding the Company’s reportable segments is presented in the following tables (in thousands):


	May 31, 2016		August 31, 2015		Three Months Ended November 30,
Total Assets
					2016			2015
Net Sales
Retail	$	191,809	$	178,200	$	291,865		$	290,777
Wholesale		699,902		707,266		221,513			284,164

	$	891,711	$	885,466	$	513,378		$	574,941

Intersegment Sales
Wholesale					$	108,058		$	104,853

Operating (Loss) Income
Retail					$	(3,280	)	$	3,508
Wholesale						(6,032	)		12,370

					$	(9,312	)	$	15,878

Depreciation and Amortization
Retail					$	2,248		$	2,109
Wholesale						10,004			9,593

					$	12,252		$	11,702

For the periods ended ~~May 31,~~November 30, 2016 and 2015, net pension and other postretirement benefit costs (income) were comprised of the following:


	Pension Benefits
	Three Months Ended						Nine Months Ended						Pension Benefits						Other Post-Retirement Benefits
	May 31,						May 31,						Three Months Ended November 30,						Three Months Ended November 30,
	2016			2015			2016			2015			2016			2015			2016			2015
	(in thousands)												(in thousands)
Service cost	$	168		$	157		$	505		$	470		$	143		$	168		$	138		$	109
Interest cost on benefit obligation		1,356			1,213			4,068			3,638			1,001			1,356			315			385
Expected return on plan assets		(1,508	)		(1,588	)		(4,525	)		(4,763	)		(1,448	)		(1,508	)		—			—
Amortization and deferral of net loss		318			180			953			541
Amortization and deferral of net loss (income)														427			318			(691	)		(1,136	)

Net periodic benefit cost (income)	$	334		$	(38	)	$	1,001		$	(114	)	$	123		$	334		$	(238	)	$	(642	)


	Other Post-Retirement Benefits
	Three Months Ended						Nine Months Ended
	May 31,						May 31,
	2016			2015			2016			2015
	(in thousands)
Service cost	$	109		$	151		$	327		$	453
Interest cost on benefit obligation		386			413			1,156			1,239
Amortization and deferral of net income		(1,137	)		(786	)		(3,409	)		(2,358	)

Net periodic benefit income	$	(642	)	$	(222	)	$	(1,926	)	$	(666	)

As of ~~May 31,~~November 30, 2016, ~~$3,592,000~~$885,000 of contributions have been made to the Company pension plans for the fiscal year ending August 31, ~~2016.~~2017.

The Company accrues post-retirement benefits other than pensions, during the years that the employees render the necessary service, of the expected cost of providing those benefits to an employee and the employee’s beneficiaries and covered dependents.

The carrying values of all financial instruments classified as a current asset or a current liability approximate fair value because of the short maturity of these instruments. The fair value of ~~marketable securities is determined by available market prices. The fair value (was~~the long-term debt was less ~~than) exceeded the~~than its carrying value ~~of the long term debt~~ at ~~May 31,~~November 30, 2016 and August 31, ~~2015~~2016 by ~~$(775,000)~~$354,000 and ~~$16,636,000,~~$220,000, respectively.

On July 31, 2014, URC and Kiantone ~~Pipeline Corporation~~ (together the “Company Parties”), on the one hand, and Enbridge Energy Limited Partnership (“EEPL”) and Enbridge Pipelines Inc. (“EPI” and, together with EEPL, the “Carriers”), on the other hand, entered into a letter agreement (the “Letter Agreement”) with respect to approximately 88.85 miles of pipeline owned by the Carriers, which transports crude oil from Canada to the

Company’s Kiantone Pipeline in West Seneca, New York and serves the Company’s refinery in Warren, Pennsylvania (“Line 10”).

Pursuant to the Letter Agreement, the Company agreed to fund certain integrity costs necessary to maintain Line 10 (the “Integrity Costs”). ~~Pursuant to the Letter Agreement the~~The Carriers agreed to reconcile their actual expenses for the integrity maintenance and refund any excess payments made by the Company. The parties agreed to apply any credit to the Company as a result of such reconciliation to amounts owed by the Company for Subsequent Year Pipe Replacement Costs (as defined below). For each subsequent calendar year through the earlier of the expiration or closing of the purchase rights granted to the Company pursuant to the Put and Call Agreement (which is defined and discussed below), the Carriers will provide the Company with an invoice for the Integrity Costs for such calendar year (“Subsequent Year Integrity Costs”). The Carriers’ actual expenses with respect to the integrity ~~maintenance and pipe replacement~~costs will be ~~reconciled~~recorded against ~~the Subsequent Year~~ Integrity ~~and Pipe~~Costs paid for any subsequent year, as well as against any Replacement Costs, ~~for each fiscal year.~~which are defined and discussed below.

In addition, the Company agreed to pay for half the cost of replacing certain portions of Line 10 in accordance with a plan agreed to between the Company Parties and the Carriers. The Company will pay 50% of the estimated expenses of the replacement project for each segment of Line 10 to be replaced (the “Replacement Costs”) within 30 days of its receipt of an invoice for the same, along with a project management fee of ~~2 1/4%~~2.25%. Each Carrier will initially fund the remaining 50% of the Replacement Costs during construction, provided that the Company will reimburse the Carriers for their actual cost of funds during the construction process. Once construction is complete and each replaced segment of Line 10 is put into service, and assuming the Company has not exercised its rights to purchase Line 10 pursuant to the Put and Call Agreement (as defined and discussed below), the Company will repay the Carriers the 50% of the Replacement Costs they funded over a ~~10 year~~10-year period.

Pursuant to the Letter Agreement, the Company and the Carriers agreed to negotiate the terms and conditions of a put and call option agreement for Line 10 (the “Put and Call Option Agreement” and, together with the Letter Agreement, the “Enbridge Agreement”). On ~~July~~April 8, 2015 (the “Execution Date”), the Company entered into the Put and Call Option Agreement with each of the ~~Carriers as called for in the Letter Agreement. The Put and Call Option Agreement entered into with~~ Enbridge LP (the “U.S. Agreement”) ~~is substantially similar to the Put~~ and ~~Call Option Agreement entered into with~~ Enbridge ~~Inc.~~Inc (the “Canadian Agreement”, and together with the U.S. Agreement, the “Put and Call Options Agreement”)~~. The~~, which agreements are substantially similar. Pursuant to the Put and Call Agreement; the Company was granted a right to purchase and the Company gave the Carriers ~~own Line 10, including real property interests through and under which Line 10 passes,~~a right to put to the Company the Carriers’ assignable permits related to the ownership and operation of Line 10, as well as personal property, contract rights, records and incidental rights held solely in connection with Line 10 (collectively, the “Assets”). ~~Pursuant~~

The Carrier’s Put Option is exercisable beginning on the date that is the earlier of (a) January 1, 2026 and (b) the date that is 30 days after the latest of (i) the date on which the Carriers give notice that the Line 10 replacement work performed pursuant to the Letter Agreement is sufficiently completed (as contemplated in the Call and Put Agreement) and (ii) the ninth (9^th) anniversary of the Execution Date (the “Put Option Commencement Date”). The Put Option terminates on the date that is 24 months after either (a) the Put Option Commencement Date if such date is the first of a month or (b) the first day of the calendar month immediately following the Put Option Commencement Date if it is not the first day of the month (the “Put/Call Option Expiry Date”). The Company’s Call Option is exercisable at any time beginning on the Execution Date and ending on the Put/Call Option Expiry Date.

The Company considered whether the Put and Call Agreement should be separated from the ~~Carriers granted~~host contract in accordance with ASC 815 embedded derivative guidance and concluded that it doesn’t meet the criteria for separation. The Company a right (the “Call Option”) to purchase all of the Assets and the Company granted the Carriers the right to put all the Assets to the Company (the “Put Option” and, together with the Call Option, the “Purchase Options”) subject to the terms and conditions of the Put and Call Agreement.

The Put and Call Agreement may be terminated by the mutual consent of the Company and the Carriers and shall automatically terminate if neither Purchase Option is exercised prior to the expiration dates identified in the Put and Call Agreement. Moreover, either the Company or a Carrier may terminatedetermined that the Put and Call Agreement ~~if a closing~~is interdependent with the Line 10 Agreement, and therefore is not freestanding and is accounted for as part of the ~~Asset sale shall not have occurred on or before December 31, 2028 assuming the terminating party~~Line 10 Agreement. As such we concluded that there is not then in breach of the Put and Call Agreement and if a party has breached a representation, such breach has not been cured within the time periods allotted by the Put and Call Agreement. Finally, the Company may terminate the Put and Call Agreement by notifying the Carriers to cease the replacement work contemplated in the Letter Agreement. The Company has assessed theno separate accounting impact of the Put and Call Agreement ~~and determined there is no impact~~ until ~~the time when~~ it becomes probable that ~~the Put or Call~~it will be exercised. As of November 30, 2016, neither the Company nor the Carrier have exercised their rights under the Put and Call Agreement.

On December 30, 2016, Kwik-Fil, Inc. (as Borrower) and United Refining Company of Pennsylvania (as Fee Owner), entered into a loan agreement with a bank in the amount of $25,000,000 which matures on October 20, 2023. Pursuant to the loan agreement, interest is calculated as follows: (a) for LIBOR Loans, at

either the LIBOR plus 2.50% or the Prime Rate, (b) for Reference Rate Loans, the Prime Rate and (c) for Fixed Rate Loans, at the greater of the Fixed Rate or 4.25% per annum. Under the terms of the agreement, the Company will make 83 monthly principal installments of approximately $83,000 with the remaining principal balance due on October 20, 2023. The loan is secured by a first lien mortgage on certain convenience store units owned by United Refining Company of Pennsylvania and contains various covenants applicable to the Borrower, which include, among others, maintaining a debt service coverage ratio. Payments due under a master lease between URC and the Borrower are guaranteed by the Company. Proceeds of the loan were used for general corporate purposes of the Company.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This Quarterly Report on Form 10-Q contains certain statements that constitute “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements may include, among other things, United Refining Company and its subsidiaries current expectations with respect to future operating results, future performance of its refinery and retail operations, capital expenditures and other financial items. Words such as “expects”, “intends”, “plans”, “projects”, “believes”, “estimates”, “may”, “will”, “should”, “shall”, “anticipates”, “predicts”, and similar expressions typically identify such forward looking statements in this Quarterly Report on Form 10-Q.

By their nature, all forward looking statements involve risk and uncertainties. All phases of the Company’s operations involve risks and uncertainties, many of which are outside of the Company’s control, and any one of which, or a combination of which, could materially affect the Company’s results of operations and whether the forward looking statements ultimately prove to be correct. Actual results may differ materially from those contemplated by the forward looking statements for a number of reasons.

Although we believe our expectations are based on reasonable assumptions within the bounds of its knowledge, investors and prospective investors are cautioned that such statements are only projections and that actual events or results may differ materially depending on a variety of factors described in greater detail in the Company’s filings with the SEC, including quarterly reports on Form 10-Q, annual reports on Form 10-K, current reports on Form 8-K, etc. In addition to the factors discussed elsewhere in this Quarterly Report on Form 10-Q, the Company’s actual consolidated quarterly or annual operating results have been affected in the past, or could be affected in the future, by additional factors.

Prices of crude oil, other feedstocks and refined products depend on numerous factors beyond our control, including ~~without limitation:~~the supply of and demand for crude oil, other feedstocks, gasoline, diesel, asphalt and other refined products. Such supply and demand are affected by, among other things:

Our direct operating ~~results~~expense structure also impacts our earnings. Our major direct operating expenses include employee and ~~financial condition.~~contract labor, maintenance and energy costs. Our predominant variable direct operating cost is energy, which is comprised primarily of fuel and other utility services. The volatility in costs of fuel, principally natural gas, and other utility services, principally electricity, used by our refinery and other operations affect our operating costs. Fuel and utility prices have been, and will continue to be, affected by factors outside our control, such as supply and demand for fuel and utility services in both local and regional markets. Natural gas prices have historically been volatile and, typically, electricity prices fluctuate with natural gas prices. Future increases in fuel and utility prices may have a negative effect on our earnings and cash flows.

All subsequent written and oral forward looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the foregoing. We undertake no obligation to update any information contained herein or to publicly release the results of any revisions to any such forward looking statements that may be made to reflect events or circumstances that occur, or which we become aware of, after the date of this Quarterly Report on Form 10-Q.

The lagged 3-2-1 crackspread is measured by the difference between the prices of crude oil contracts traded on the NYMEX for the preceding month to the prices of NYMEX gasoline and heating oil contracts in the current trading month. The Company uses a lagged crackspread as a margin indicator as it reflects the margin during the time period between the purchase of crude oil and its delivery to the refinery for processing. The lagged crackspread for the ~~third~~first quarter of fiscal ~~2016 was $23.33.~~2017 averaged $13.96/barrel (“bbl”). Through ~~July 1, 2016~~January 6, 2017 the indicated lagged crackspread for the ~~fourth~~second quarter ending ~~August 31, 2016 was $15.94,~~February 28, 2017 averaged $18.52/bbl, a ~~$7.39 decrease~~$4.56 increase from the average for the ~~third~~first quarter of fiscal ~~2016.~~2017.

NYMEX crude fluctuated during the first quarter of fiscal 2017 from a low of $43.03/bbl to a high of $54.06/bbl and closed on January 6, 2017 at $53.99/bbl.

The wholesale segment is responsible for the acquisition of crude oil, petroleum refining, supplying petroleum products to the retail segment and the marketing of petroleum products to wholesale and industrial customers. The retail segment sells petroleum products under the Kwik Fill^®, Citgo^® and Keystone^® brand names through a network of Company-operated retail units and convenience and grocery items through Company-owned gasoline stations and convenience stores under the Red Apple Food Mart^® and Country Fair^® brand names.

A discussion and analysis of the factors contributing to the Company’s results of operations are presented below. The accompanying Consolidated Financial Statements and related Notes, together with the following information, are intended to supply ~~investors~~interested parties with a reasonable basis for evaluating the Company’s operations, but does not serve to predict the Company’s future performance.

Retail sales ~~decreased~~increased during the fiscal quarter ended ~~May 31,~~November 30, 2016 by ~~$45.1~~$1.1 million or ~~14.1%~~.4% from the comparable period in fiscal 2015 from ~~$320.7~~$290.8 million to ~~$275.6~~$291.9 million. The ~~decrease~~increase was due to a ~~$46.2~~$1.4 million increase in merchandise sales offset by a $.3 million decrease in petroleum ~~sales offset by an increase in merchandise sales of $1.1 million.~~sales. The petroleum sales decrease resulted from a ~~17.5%~~1.0% decrease in retail selling prices per gallon ~~and a 1.0~~offset by .8 million gallon or a ~~1.1% decrease~~.9% increase in petroleum volume.

Retail costs of goods sold ~~decreased~~increased during the fiscal quarter ended ~~May 31,~~November 30, 2016 by ~~$40.6~~$7.0 million or ~~14.3%~~2.8% from the comparable period in fiscal 2015 from ~~$284.2~~$249.6 million to ~~$243.6~~$256.6 million. The ~~decrease~~increase was primarily due to ~~decreases~~increases of ~~$38.8~~$6.2 million in petroleum purchase costs, ~~and~~ fuel taxes of ~~$1.9~~$.1 million, ~~offset by an increase~~freight costs of $.1 million and $.6 million in merchandise costs.

Retail Selling, General and Administrative (“SG&A”) expenses remained relatively constant during the fiscal quarters ended ~~May 31, 2016 and 2015.~~

Retail sales decreased during the nine months ended May 31, 2016 by $187.7 million or 18.8% from the comparable period in fiscal 2015 from $998.5 million to $810.8 million. The decrease was primarily due to $192.7 million in petroleum sales, offset by an increase of $5.0 million in merchandise sales. The petroleum sales decrease resulted from a 23.4% decrease in retail selling prices per gallon and a 2.8 million gallon or 1.0% decrease in sales volume.

Retail costs of goods sold decreased during the nine months ended May 31, 2016 by $168.5 million or 19.3% from the comparable period in fiscal 2015 from $871.7 million to $703.2 million. The decrease was primarily due to decreases of $170.9 million in petroleum purchase costs and freight costs of $.1 million, offset by increases in fuel taxes of $.7 million and merchandise costs of $1.8 million.

~~Retail SG&A expenses remained relatively constant during the nine months ended May 31,~~November 30, 2016 and 2015.


	Three Months Ended				Nine Months Ended				Three Months Ended
	May 31,				May 31,				November 30,
	2016		2015		2016		2015		2016			2015
	(dollars in thousands)								(dollars in thousands)
Net Sales (a)	$	222,344	$	282,137	$	700,450	$	1,009,916	$	221,513		$	284,164
Costs of goods sold (exclusive of depreciation and amortization)		151,873		201,701		616,981		870,046		210,278			255,189
Selling, general and administrative expenses		7,387		6,110		21,296		19,091		7,263			7,012
Depreciation and amortization expenses		10,043		8,623		30,312		25,944		10,004			9,593

Segment Operating Income	$	53,041	$	65,703	$	31,861	$	94,835
Segment Operating (Loss) Income									$	(6,032	)	$	12,370

Wholesale sales decreased during the quarter ended ~~May 31,~~November 30, 2016 by ~~$59.8~~$62.7 million or ~~21.2%~~22.0% from the comparable period in fiscal 2015 from ~~$282.1~~$284.2 million to ~~$222.3~~$221.5 million. The decrease was due primarily to a ~~30.6%~~10.8% decrease in wholesale prices ~~offset by an increase of 13.6%~~and 12.6% in wholesale volume.

Wholesale costs of goods sold decreased during the quarter ended ~~May 31,~~November 30, 2016 by ~~$49.8~~$44.9 million or ~~24.7%~~17.6% from the comparable period in fiscal 2015 from ~~$201.7~~$255.2 million to ~~$151.9~~$210.3 million. The decrease in wholesale costs of goods sold during this period was primarily due to a decrease in cost of raw materials.

Wholesale SG&A expenses remained relatively constant during the quarter ended ~~May 31, 2016 and 2015.~~

Wholesale sales decreased during the nine months ended May 31, 2016 by $309.5 million or 30.6% from the comparable period in fiscal 2015 from $1,009.9 million to $700.4 million. The decrease was due to a 38.0% decrease in wholesale prices offset by an 11.9% increase in wholesale volume.

Wholesale costs of goods sold decreased during the nine months ended May 31, 2016 by $253.1 million or 29.1% from the comparable period in fiscal 2015 from $870.1 million to $617.0 million. The decrease in wholesale costs of goods sold was primarily due to a decrease in the cost of raw materials.

~~Wholesale SG&A expenses remained relatively constant during the nine months ended May 31,~~November 30, 2016 and 2015.

Depreciation and amortization increased during the three months ended ~~May 31,~~November 30, 2016 by ~~$1.7~~$.6 million from the comparable period in fiscal 2015 from ~~$10.5~~$11.7 million to ~~$12.2~~$12.3 million. The increase was primarily due to increases of ~~$1.8~~$1.2 million in amortization of integrity and replacement costs and miscellaneous depreciation costs of ~~$.6~~$.3 million offset by a reduction in amortization of turnaround expense of ~~$.7 million.~~

Depreciation and amortization increased during the nine months ended May 31, 2016 by $5.4 million from the comparable period in fiscal 2015 from $31.3 million to $36.7 million. The increase was primarily due to increases of $4.2 million in amortization of integrity and replacement costs and miscellaneous depreciation costs of $1.9 million offset by a reduction in amortization of turnaround expense of $.7$.9 million.

Net interest expense (interest expense less interest income) decreased during the three months ended ~~May 31,~~November 30, 2016 by ~~$4.2 million from the comparable period in fiscal 2015. The decrease was primarily due to early redemption of Senior Notes due 2018 and the lower interest rate on the Term Loan outstanding.~~

~~Net interest expense (interest expense less interest income) decreased during the nine months ended May 31, 2016 by $10.0~~$2.4 million from the comparable period in fiscal 2015. The decrease was primarily due to early redemption of Senior Notes due 2018 and the lower interest rate on the Term Loan outstanding.

The Company’s effective tax rate was 37% ~~and 39%~~ for the three months ~~and nine months~~ ended ~~May 31,~~November 30, 2016 and ~~2015, respectively.~~2015.

We operate in an environment where our liquidity and capital resources are impacted by changes in the price of crude oil and refined petroleum products, availability of credit, market uncertainty and a variety of additional factors beyond our control. Included in such factors are, among others, the level of customer product demand,

weather conditions, governmental regulations, worldwide political conditions and overall market and economic conditions.

The following table summarizes selected measures of liquidity and capital resources (in thousands):


	May 31, 2016		November 30, 2016
Cash and cash equivalents	$	78,909	$	50,589
Short-term investments			$	10,188
Working capital	$	210,549	$	198,863
Current ratio		2.6		2.7
Debt	$	294,813	$	300,450

Primary sources of liquidity have been cash and cash equivalents, and borrowing availability under our revolving credit facility (the “Amended and Restated Revolving Credit Facility”) with PNC Bank, N.A. as Administrator (the “Agent Bank”). We believe available capital resources are adequate to meet our working capital, debt service, and capital expenditure requirements for existing operations.

Our cash and cash equivalents consist of bank balances and investments in money market funds. These investments have staggered maturity dates, none of which exceed three months. They have a high degree of liquidity since the securities are traded in public markets.

The changes in cash for the ~~nine~~three months ended ~~May~~November 31, 2016 are described below.


	Nine Months Ended May 31, 2016			Three Months Ended November 30, 2016
	(in millions)			(in millions)
Cash provided by (used in) working capital items:
Accounts receivable decrease				$	11.3
Inventory decrease	$	42.0			7.1
Accounts payable increase		14.4
Accounts receivable decrease		14.2
Prepaid expense decrease		8.6			2.1
Income taxes payable decrease		(7.4	)
Refundable income taxes decrease					.1
Accounts payable decrease					(14.8	)
Prepaid income taxes increase		(5.1	)		(7.0	)
Refundable income taxes increase		(4.2	)
Amounts due from affiliated companies, net increase		(2.9	)
Sales, use and fuel taxes payable decrease					(1.7	)
Amounts due to affiliated companies, net decrease					(.9	)
Accrued liabilities decrease		(1.7	)		(.6	)
Sales, use and fuel taxes payable decrease		(1.0	)

Total change	$	56.9		$	(4.4	)

~~Available cash on hand decreased by $38.1 million.~~ Other cash uses included:

We require a substantial investment in working capital which is susceptible to large variations during the year resulting from purchases of inventory and seasonal demands. Inventory purchasing activity is a function of sales activity and turnaround cycles for the different refinery units.

Maintenance and non-discretionary capital expenditures have averaged approximately $6.0 million annually over the last three years for the refining and marketing operations. Management does not foresee any material increase in these maintenance and non-discretionary capital expenditures during fiscal year ~~2016~~2017 at this time.

Future liquidity, both short and long-term, will continue to be primarily dependent on realizing a refinery margin sufficient to cover fixed and variable expenses, including planned capital expenditures. We expect to be able to meet our working capital, capital expenditure, contractual obligations, letter of credit and debt service requirements out of cash flow from operations, cash on hand and borrowings under our Credit Agreement of $225,000,000. This provides the Company with flexibility relative to its cash flow requirements in light of market fluctuations, particularly involving crude oil prices and seasonal business cycles and will assist the Company in meeting its working capital, ongoing capital expenditure needs and for general corporate purposes.

On October 20, 2015, URC, United Refining Company of Pennsylvania, Kiantone, United Refining Company of New York Inc., United Biofuels, Inc., Country Fair, Inc. and Kwik-Fill Corporation (collectively, the “Borrowers”) entered into the Credit Agreement with a group of lenders led by PNC Bank, National Association, and PNC Capital Markets LLC, as Sole Lead Arranger and Bookrunner. The Credit Agreement amends and restates the Existing Credit Facility. The Credit Agreement will terminate on October 19, 2020. Until the Expiration Date, the Company may borrow on the New Revolving Credit Facility (as defined below) on a borrowing base formula set forth in the Credit Agreement.

Pursuant to the Credit Agreement, the Company increased its existing senior secured revolving credit facility from $175,000,000 to $225,000,000. The New Revolving Credit Facility may be increased by an amount not to exceed $50,000,000 without additional approval from the lenders named in the Credit Agreement if existing lenders agree to increase their commitments or additional lenders commit to fund such increase. Interest under the New Revolving Credit Facility is calculated as follows: (a) for domestic rate borrowings, at (i) the greater of the Agent’s prime rate, federal funds rate plus .5% or the daily LIBOR rate plus 1%, plus (ii) an applicable margin of 1.25% to 1.75%, and (b) for euro-rate borrowings, at the LIBOR rate plus an applicable margin of 2.25% to 2.75%. The applicable margin will vary depending on a formula calculating the Company’s average unused availability under the facility. In addition, pursuant to the Credit Agreement, the Company entered into a term loan in the amount of $250,000,000, which was made in a single drawing on the Closing Date (“Term Loan” and, together with the New Revolving Credit Facility, the “Credit Obligations”). Under the Term Loan, interest is calculated as follows: (a) for domestic rate borrowings, at (i) the greater of the Agent’s prime rate, federal funds rate plus .5% or the daily LIBOR rate plus 1%, plus (ii) an applicable margin of 1.75% to 2.25%, and (b) for euro-rate borrowings, at the LIBOR rate plus an applicable margin of 2.75% to 3.25%. The applicable margin will vary depending on a formula calculating the Company’s average unused availability under the facility. The Term Loan is prepayable in whole or in part at any time without premium or penalty. The Term Loan shall be paid in full on or prior to the Expiration Date and shall be paid in equal quarterly amounts based on a ten-year straight line amortization schedule. Prepayment of the Term Loan in whole or in part may be made at any time without premium or penalty.

Until maturity, we may borrow on a borrowing base formula as set forth in the facility. We had standby letters of credit of $8.8 million as of ~~May 31,~~November 30, 2016 and there were no outstanding borrowings under the Credit Agreement resulting in net availability of $216.2 million. As of ~~July 15, 2016,~~January 17, 2017, there were no outstanding

borrowings under the Credit Agreement and there were standby letters of credit in the amount of ~~$8.8~~$7.4 million, resulting in a net availability of ~~$216.2~~$217.6 million and the Company had full access to it.

Although we are not aware of any pending circumstances which would change our expectation, changes in the tax laws, the imposition of and changes in federal and state clean air and clean fuel requirements and other changes in environmental laws and regulations may also increase future capital expenditure levels. Future capital expenditures are also subject to business conditions affecting the industry. We continue to investigate strategic acquisitions and capital improvements to our existing facilities.

Federal, state and local laws and regulations relating to the environment affect nearly all of our operations. As is the case with all the companies engaged in similar industries, we face significant exposure from actual or potential claims and lawsuits involving environmental matters. Future expenditures related to environmental matters cannot be reasonably quantified in many circumstances due to the uncertainties as to required remediation methods and related clean-up cost estimates. We cannot predict what additional environmental legislation or regulations will be enacted or become effective in the future or how existing or future laws or regulations will be administered or interpreted with respect to products or activities to which they have not been previously applied.

Seasonal factors affecting the Company’s business may cause variation in the prices and margins of some of the Company’s products. For example, demand for gasoline tends to be highest in spring and summer months, while demand for home heating oil and kerosene tends to be highest in winter months.

As a result, the margin on gasoline prices versus crude oil costs generally tends to increase in the spring and summer, while margins on home heating oil and kerosene tend to increase in the winter.

The effect of inflation on the Company has not been significant during the last five fiscal years.

The Company uses its Amended and Restated Revolving Credit Facility to finance a portion of its operations. This on-balance sheet financial instrument, to the extent it provides for variable rates, exposes the Company to interest rate risk resulting from changes in the Agent Bank’s Prime rate, the Federal Funds or LIBOR rate. As of ~~July 15, 2016,~~January 17, 2017, there were no outstanding borrowings under the Amended and Restated Revolving Credit Facility.

From time to time, the Company uses derivatives to reduce its exposure to fluctuations in crude oil purchase costs and refining margins. Derivative products, specifically crude oil option contracts and crack spread option contracts are used to hedge the volatility of these items. The Company accounts for changes in the fair value of its contracts by marking them to market and recognizing any resulting gains or losses in its Consolidated Statements of Operations. There has been no derivative activity in fiscal ~~2016.~~2017.

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of ~~May 31,~~November 30, 2016. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company is reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures

include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of ~~May 31,~~November 30, 2016, our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

There have not been any changes in the Company’s internal controls over financial reporting that occurred during the Company’s fiscal quarter ended ~~May 31,~~November 30, 2016 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

There have been no material changes in our Risk Factors disclosed in the Form 10-K for the year ended August 31, ~~2015.~~2016.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


Pennsylvania		25-1411751
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

15 Bradley Street
Warren, Pennsylvania		16365
(Address of principal executive office)		(Zip Code)


Large accelerated filer ¨☐		Accelerated filer ¨☐
Non-accelerated filer x☒ (Do not check if a smaller reporting company)		Smaller reporting company ¨☐


Name	State of Other Jurisdiction of Incorporation	IRS Employer Identification Number		Commission File Number
Kiantone Pipeline Corporation	New York		25-1211902		333-35083-01
Kiantone Pipeline Company	Pennsylvania		25-1416278		333-35083-03
United Refining Company of Pennsylvania	Pennsylvania		25-0850960		333-35083-02
United Jet Center, Inc.	Delaware		52-1623169		333-35083-06
Kwik-Fill Corporation	Pennsylvania		25-1525543		333-35083-05
Independent Gas and Oil Company of Rochester, Inc.	New York		06-1217388		333-35083-11
Bell Oil Corp.	Michigan		38-1884781		333-35083-07
PPC, Inc.	Ohio		31-0821706		333-35083-08
Super Test Petroleum, Inc.	Michigan		38-1901439		333-35083-09
Kwik-Fil, Inc.	New York		25-1525615		333-35083-04
Vulcan Asphalt Refining Corporation	Delaware		23-2486891		333-35083-10
Country Fair, Inc.	Pennsylvania		25-1149799		333-35083-12


		PAGE
PART I. FINANCIAL INFORMATION			4

Item 1.	Financial ~~Statements~~Statements.		4

	Consolidated Balance Sheets – ~~May 31,~~November 30, 2016 (unaudited) and August 31, ~~2015~~2016		4

	Consolidated Statements of Operations – ~~Quarter and Nine~~Three Months Ended ~~May 31,~~November 30, 2016 and 2015 (unaudited)		5

	Consolidated Statements of Comprehensive ~~Income (Loss)~~Loss – ~~Quarter and Nine~~Three Months Ended ~~May 31,~~November 30, 2016 and 2015 (unaudited)		6

	Consolidated Statements of Cash Flows – ~~Nine~~Three Months Ended ~~May 31,~~November 30, 2016 and 2015 (unaudited)		7

	Notes to Consolidated Financial Statements (unaudited)		8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations~~Operations.		1416

Item 3.	Quantitative and Qualitative Disclosures about Market ~~Risk~~Risk.		22

Item 4.	Controls and ~~Procedures~~Procedures.		22

PART II. OTHER INFORMATION			24

Item 1.	Legal ~~Proceedings~~Proceedings.		2423

Item 1A.	Risk ~~Factors~~Factors.		2423

Item 2.	Unregistered Sales of Equity Securities and Use of ~~Proceeds~~Proceeds.		2423

Item 3.	Defaults Upon Senior ~~Securities~~Securities.		2423

Item 4.	Mine Safety ~~Disclosures~~Disclosures.		2423

Item 5.	Other ~~Information~~Information.		2423

Item 6.	~~Exhibits~~Exhibits.		2423

Signatures.			2524


	Three Months Ended						Nine Months Ended
	May 31,						May 31,
	2016			2015			2016			2015
Net income (loss)	$	27,741		$	34,707		$	(3,467	)	$	53,924
Other comprehensive loss, net of taxes:
Unrecognized post retirement costs, net of taxes of $(304) and $(236) for the three months ended May 31, 2016 and 2015, respectively and $(930) and $(710) for the nine months ended May 31, 2016 and 2015, respectively		(519	)		(371	)		(1,539	)		(1,111	)

Other comprehensive loss		(519	)		(371	)		(1,539	)		(1,111	)

Total comprehensive income (loss)	$	27,222		$	34,336		$	(5,006	)	$	52,813



Exhibit 31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Exhibit 101		Interactive XBRL Data


	Three Months Ended						Nine Months Ended
	May 31,						May 31,
	2016			2015			2016			2015
Refinery Product Yield (thousands of barrels)
Gasoline and gasoline blendstock		2,603			2,421			8,184			7,613
Distillates		1,409			1,306			4,161			3,937
Asphalt		1,791			1,698			5,457			5,286
Butane, propane, residual products, internally produced fuel and other (“Other”)		710			682			1,765			1,896

Total Product Yield		6,513			6,107			19,567			18,732


% Heavy Crude Oil of Total Refinery Throughput (b)		60	%		61	%		61	%		61	%
Crude throughput (thousand barrels per day)		65.6			61.0			65.5			62.5


Product Sales (thousand of barrels) (a)
Gasoline and gasoline blendstock		1,723			1,430			5,312			4,598
Distillates		1,214			1,017			3,512			3,201
Asphalt		1,696			1,639			5,276			4,746
Other		173			146			498			499

Total Product Sales Volume		4,806			4,232			14,598			13,044


Product Sales (dollars in thousands) (a)
Gasoline and gasoline blendstock	$	99,050		$	105,247		$	288,106		$	361,379
Distillates		67,098			82,421			190,911			293,101
Asphalt		54,109			91,104			214,574			337,626
Other		2,087			3,365			6,859			17,810

Total Product Sales	$	222,344		$	282,137		$	700,450		$	1,009,916