SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________
FORM 11-K
_____________
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period ______ to ______.
Commission File Number: 1-10398
(A) Full title of the plan and address of the plan if different
from that of the issuer named below:
GIANT INDUSTRIES, INC. AND AFFILIATED COMPANIES
401(k) PLAN
(B) Name of the issuer of the securities held pursuant to the plan
and the address of its principal executive office:
GIANT INDUSTRIES, INC.
23733 North Scottsdale Road
Scottsdale, Arizona 85255
REQUIRED INFORMATION
Giant Industries, Inc. and Affiliated Companies 401(k) Plan (the "Plan") is
subject to the Employee Retirement Income Security Act of 1974 ("ERISA").
Therefore, in lieu of the requirements of Items 1-3 of Form 11-K, the
financial statements and schedules of the Plan for the two fiscal years ended
December 31, 2001 and 2000, which have been prepared in accordance with the
financial reporting requirements of ERISA, are attached hereto as Appendix 1
and incorporated herein by this reference.
EXHIBITS
Exhibit 23.1 - Independent Auditors' Consent
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Committee has duly caused this annual report
to be signed by the undersigned thereunto duly authorized.
GIANT INDUSTRIES, INC. AND AFFILIATED
COMPANIES 401(k) PLAN
Date: June 28, 2002 Signature: /s/ Kim H. Bullerdick
-------------------------------------
Kim H. Bullerdick
Vice President, General Counsel,
and Secretary
Date: June 28, 2002 Signature: /s/ Gary R. Dalke
-------------------------------------
Gary R. Dalke, Vice President,
Controller, Chief Accounting Officer,
and Assistant Secretary
Date: June 28, 2002 Signature: /s/ Charles F. Yonker
-------------------------------------
Charles F. Yonker
Vice President, Human Resources
APPENDIX 1
GIANT INDUSTRIES, INC. AND AFFILIATED COMPANIES
401(k) PLAN
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS
ENDED DECEMBER 31, 2001 AND 2000,
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 2001, AND
INDEPENDENT AUDITORS' REPORT
GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES 401(k) PLAN
TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED
DECEMBER 31, 2001 AND 2000:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-8
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 2001:
Form 5500, Schedule H, Part IV, Schedule of Assets Held for
Investment Purposes at End of Year 9
Form 5500, Schedule H, Part IV, Schedule of Assets Both
Acquired and Disposed of Within the Plan Year 10
INDEPENDENT AUDITORS' REPORT
Administrative Committee
Giant Industries, Inc. and Affiliated Companies 401(k) Plan
Scottsdale, Arizona
We have audited the accompanying statements of net assets available for
benefits of the Giant Industries, Inc. and Affiliated Companies 401(k)
Plan (the "Plan") as of December 31, 2001 and 2000, and the related
statements of changes in net assets available for benefits for the years
then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December
31, 2001 and 2000, and the changes in net assets available for benefits
for the years then ended in conformity with accounting principles
generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying supplemental
schedules of (1) assets held for investment purposes and (2) assets both
acquired and disposed of within the plan year are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure
under the Employee Retirement Income Security Act of 1974. These schedules
are the responsibility of the Plan's management. Such schedules have been
subjected to the auditing procedures applied in our audit of the basic
2001 financial statements and, in our opinion, are fairly stated in all
material respects when considered in relation to the basic financial
statements taken as a whole.
DELOITTE & TOUCHE LLP
Phoenix, Arizona
June 14, 2002
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GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES 401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2001 AND 2000
2001 2000
ASSETS
INVESTMENTS AT FAIR VALUE (Note 3) $34,663,703 $23,462,911
TRANSFER RECEIVABLE FROM EMPLOYEE STOCK
OWNERSHIP PLAN OF GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES (Note 1) - 11,688,877
EMPLOYER CONTRIBUTIONS RECEIVABLE 2,353,849 1,432,889
PARTICIPANT CONTRIBUTIONS RECEIVABLE 95,786 104,323
ACCRUED INTEREST RECEIVABLE - 77
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $37,113,338 $36,689,077
=========== ===========
See notes to financial statements.
-2-
GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES 401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 2001 AND 2000
2001 2000
ADDITIONS:
Contributions:
Participants $ 3,393,975 $ 3,219,235
Employer 2,353,849 1,432,889
Rollover 255,708 301,108
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Total contributions 6,003,532 4,953,232
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Investment (loss) income:
Interest and dividends 590,846 2,699,598
Net depreciation in fair value of investments (1,948,869) (4,803,400)
----------- -----------
Net investment loss (1,358,023) (2,103,802)
----------- -----------
Transfer from Employee Stock Ownership Plan
of Giant Industries, Inc. and Affiliated
Companies (Note 1) - 11,688,877
----------- -----------
Total additions 4,645,509 14,538,307
----------- -----------
DEDUCTIONS:
Distributions to participants 4,197,135 3,557,003
Administrative fees 24,113 2,798
----------- -----------
Total deductions 4,221,248 3,559,801
----------- -----------
INCREASE IN NET ASSETS 424,261 10,978,506
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of year 36,689,077 25,710,571
----------- -----------
End of year $37,113,338 $36,689,077
=========== ===========
See notes to financial statements.
-3-
GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2001 AND 2000
1. DESCRIPTION OF THE PLAN
The following description of the Giant Industries, Inc. and
Affiliated Companies 401(k) Plan (the "Plan") is provided for general
information purposes only. Participants should refer to the Plan agreement
for more complete information.
GENERAL - The Plan was established on July 1, 1993. Employees of
Giant Industries, Inc. and Affiliated Companies (the "Company") are
eligible to participate in the Plan on the January 1 or July 1 following
60 days of service for full-time employees or one year of service for
part-time employees. One year of service means a minimum of 1,000 hours
worked during a Plan year. Employees are able to make pre-tax
contributions to the Plan, and the Company may contribute to the Plan as
well. The Plan is subject to various regulations, particularly those
included under Internal Revenue Code ("IRC") Section 401(k) and the
Employee Retirement Income Security Act of 1974 ("ERISA").
In September 2000, the Company's Board of Directors approved the
merger of the Employee Stock Ownership Plan of Giant Industries, Inc. and
Affiliated Companies (the "ESOP") into the Plan. Effective January 1,
2001, the net assets of the ESOP were merged into the Plan, and the ESOP
was terminated. All ESOP participants who were employees of the Company on
or after January 1, 2001 became fully and immediately vested, unless their
account balances were previously forfeited under the terms of the ESOP,
the Plan and applicable law. The Plan was amended to permit participants
to elect to receive distributions from accounts transferred from the ESOP
to the Plan in the form of cash, or Company stock, or in cash and Company
stock, and to receive a distribution of all or any portion of their
account balances, without terminating employment, after attainment of age
59-1/2.
In April 2001, the net assets and participant account balances of the
terminated ESOP, which were merged into the Plan effective January 1,
2001, including investment net earnings through the date of transfer, were
transferred from Wells Fargo, the Trustee and Custodian of the ESOP, to
Fidelity Management Trust Company, the Trustee, Custodian, and
recordkeeper of the Plan.
CONTRIBUTIONS - Voluntary salary reductions may be elected by the
participant. These pre-tax salary reductions are contributed to the Plan
by the participant and range from 1 percent to 15 percent of compensation.
Effective January 1, 2002, the maximum voluntary pre-tax salary reduction
allowable under the Plan increased to 25 percent of compensation, subject
to a maximum annual dollar amount of $11,000. Additionally, effective
January 1, 2002, the Plan was amended to allow "catch-up" contributions as
defined in the Economic Growth and Tax Reconciliation Relief Act of 2001.
In accordance with this amendment, eligible participants 50 years or older
will be permitted additional contributions up to $1,000 during 2002,
$2,000 during 2003, $3,000 during 2004, $4,000 during 2005, and $5,000
during 2006 (or up to such other amount established by the IRC).
-4-
In 2001 and 2000, the Company made discretionary matching
contributions of 50 percent of every dollar contributed by eligible
participants up to a maximum of 6 percent of compensation, which totaled
$1,453,849 and $1,432,889, respectively. Participants become eligible for
the discretionary matching contribution on the first match date following
one year of service. In addition to the discretionary matching
contribution by the Company in 2001, an additional discretionary
contribution of $900,000, directed to the purchase of Company stock, was
made for participants who had met certain eligibility requirements.
Participants must be employed by the Company on the last day of the
Plan year to be eligible for Company discretionary contributions.
DISTRIBUTIONS - Distributions to participants may occur upon
participant termination from the Company, total disability, retirement,
death or hardship as defined by government regulations. A participant may
elect to either receive a lump-sum amount equal to the value of the
participant's vested interest in his or her account or rollover the
balance to another qualified retirement account. The Plan had no
participant benefit distributions payable at December 31, 2001 and 2000.
VESTING - Employee contributions to the Plan and the earnings on
these contributions are 100 percent vested and nonforfeitable at all
times. Subsequent to January 1, 2001, Company contributions to the Plan
and the earnings on these contributions are also 100 percent vested.
Effective January 1, 2001, the Plan merged with the ESOP and all
participants who were employees of the Company on or after January 1, 2001
became fully and immediately vested. Participants in the ESOP who had
terminated employment prior to January 1, 2001 were subject to a seven-
year vesting period. Forfeitures are held as an asset of the Plan in an
interest-bearing account and are not used to reduce the Company's
contribution.
PARTICIPANT ACCOUNTS - For each participant, various accounts are
maintained to record employee pre-tax salary reductions, Company matching
contributions, Company discretionary contributions and rollovers. The
benefit to which a participant is entitled is the total benefit that can
be provided from the combined amount of these participant accounts.
PARTICIPANT LOANS - Effective January 1, 2001, participants may
borrow from their fund accounts a minimum of $1,000 up to a maximum of
$50,000 or 50 percent of their participant-directed account balances,
whichever is less. The loans are secured by the balance in the
participant's account and bear interest at rates that are established at 1
percent above the prime rate. The loan shall be repaid within a period not
to exceed five years, unless the loan is used to acquire any dwelling unit
as a principal residence of the participant. In such circumstances, the
loan's repayment term shall not exceed 10 years.
PLAN ADMINISTRATION - The Company administers the Plan through a
401(k) Administrative Committee comprised of three employees who are
appointed by the Company's Board of Directors. Most expenses pertaining to
the administration of the Plan are paid by the Company, at the Company's
option. Fidelity Management Trust Company acts as the Plan's Trustee,
Custodian and recordkeeper.
AMENDMENTS - The Plan was amended in 2001 such that full-time
employees wishing to make salary deferrals to the Plan become eligible at
the first entry date after they complete 60 days of service.
-5-
PLAN TERMINATION - Although it has not expressed any intention to do
so, the Company has the right at any time to terminate the Plan subject to
the provisions set forth in ERISA. Since all participants are 100 percent
vested, participants would receive 100 percent of amounts credited to
their accounts upon liquidation and distribution of Plan assets.
INVESTMENTS - Participants direct the investment of their
contributions and any employer matching contribution into various
investment options offered by the Plan, with the exception of the
additional discretionary employer contribution, which is directed to
either the purchase of Company stock or a cash account. In addition,
effective January 1, 2001, participants are permitted to direct the
investment of their assets transferred from the ESOP that are not invested
in Company stock. The Plan currently offers 14 mutual funds and the
Company's common stock as investment options for participants.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The accompanying financial statements have been
prepared in accordance with accounting principles generally accepted in
the United States of America. The accounting records of the Plan are
maintained on the accrual basis of accounting and, accordingly, revenues
and expenses are recorded in the year earned or incurred, respectively.
INVESTMENT VALUATION AND INCOME RECOGNITION - Plan investments are
stated at fair value, which is measured by quoted market prices. Purchases
and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the ex-
dividend date.
BENEFITS - Benefits are recorded when paid.
USE OF ESTIMATES - The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect the reported amounts of net assets available for benefits and
changes therein. Actual results could differ from those estimates. The
Plan utilizes various investment instruments. Investment securities, in
general, are exposed to various risks, such as interest rate, credit, and
overall market volatility. Due to the level of risk associated with
certain investment securities, it is reasonably possible that changes in
the values of investment securities will occur in the near term and that
such changes could materially affect the amounts reported in the
statements of net assets available for Plan benefits.
-6-
3. INVESTMENTS
The following presents investments that represent 5 percent or more
of the Plan's net assets:
2001 2000
Giant Industries, Inc. Stock Fund
995,568 shares $ 9,189,093 N/A
Fidelity Contrafund
183,274 and 171,899 shares, respectively 7,838,647 $ 8,452,287
Fidelity Asset Manager Growth Fund
235,465 and 209,214 shares, respectively 3,376,574 3,328,602
Fidelity Aggressive Growth Fund
140,495 and 99,483 shares, respectively 2,672,218 3,598,291
Fidelity Asset Manager Portfolio Fund
162,608 and 146,862 shares, respectively 2,520,429 2,470,221
Fidelity Spartan U.S. Equity Index Fund
35,437 shares N/A 1,658,817
Fidelity Retirement Government Money Market Fund
2,245,229 and 1,460,205 shares, respectively 2,245,229 1,460,205
Fidelity Government Income Fund
137,432 shares N/A 1,356,456
During the Plan years ended December 31, 2001 and 2000, the Plan's
investments (including gains and losses on investments bought and sold, as
well as held during the year) depreciated in value by $(1,948,869) and
$(4,803,400), respectively, as follows:
2001 2000
Mutual funds $(5,160,419) $(4,800,394)
Company common stock 3,211,550 (3,006)
----------- -----------
Net depreciation in fair value of investments $(1,948,869) $(4,803,400)
=========== ===========
4. NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of the
changes in net assets relating to the nonparticipant-directed investments is
as follows as of, and for the year ended December 31, 2001:
Giant Industries, Inc. Stock Fund $ 9,062,172
===========
Changes in net assets:
Contributions receivable 900,000
Net appreciation in net assets 2,130,823
Benefits paid to participants (1,523,896)
Transfers to participant-directed investments (24,869)
-----------
$ 1,482,058
===========
-7-
5. FEDERAL INCOME TAX STATUS
The Plan obtained its latest determination letter dated December 30,
1996, in which the Internal Revenue Service ("IRS") stated that the Plan,
as then designed, was in compliance with the applicable requirements of
the IRC. As discussed in Note 1, effective January 1, 2001, the Plan
merged with the ESOP. As a result of these changes, the Plan filed Form
5300 with the IRS in February of 2002 seeking a new determination letter.
The Plan Administrator and the Plan's tax counsel believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the IRC, and accordingly, no provision for income taxes
has been included in the Plan's financial statements.
6. RELATED-PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds managed by
Fidelity Investments. Fidelity Investments is an affiliate of the Trustee
as defined by the Plan and, therefore, these transactions qualify as
party-in-interest transactions. Fees paid by the Plan for the investment
management services amounted to $24,113 and $2,798 for the years ended
December 31, 2001 and 2000, respectively.
******
-8-
GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES 401(k) PLAN
FORM 5500, SCHEDULE H, PART IV
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
DECEMBER 31, 2001
Identity of Issuer, Description of Investment Including
Borrower, Lessor or Maturity Date, Rate of Interest, Current
Similar Party Collateral, Par or Maturity Value Cost Value
- ---------------------------------------- ------------------------------------------- ---------- -----------
*Fidelity Retirement Government Money
Market Fund Money Market Fund - 2,245,229 shares $ ** $ 2,245,229
*Fidelity Government Income Fund Mutual Fund - 185,256 shares ** 1,847,007
*Fidelity Asset Manager Portfolio Fund Mutual Fund - 162,608 shares ** 2,520,429
*Fidelity Asset Manager Growth Fund Mutual Fund - 235,465 shares ** 3,376,574
*Fidelity Contrafund Mutual Fund - 183,274 shares ** 7,838,647
*Fidelity Aggressive Growth Fund Mutual Fund - 140,495 shares ** 2,672,218
*Fidelity Diversified International Fund Mutual Fund - 39,026 shares ** 744,609
*Fidelity Freedom Income Mutual Fund - 650 shares ** 7,100
*Fidelity Freedom 2000 Mutual Fund - 2,060 shares ** 23,731
*Fidelity Freedom 2010 Mutual Fund - 13,756 shares ** 173,462
*Fidelity Freedom 2020 Mutual Fund - 16,172 shares ** 203,442
*Fidelity Freedom 2030 Mutual Fund - 11,695 shares ** 146,886
*Fidelity Freedom 2040 Mutual Fund - 4,351 shares ** 32,152
*Fidelity Spartan U.S. Equity Index Fund Mutual Fund - 42,087 shares ** 1,710,426
*Participant-directed - Giant
Industries, Inc. Stock Fund Stock Fund - 13,751 shares ** 126,921
*Nonparticipant-directed - Giant
Industries, Inc. Stock Fund Stock Fund - 981,817 shares 6,214,902 9,062,172
*Participant notes receivable Participant loan, interest at prime + 1.00% ** 1,476,329
(5.75% at December 31, 2001)
Cash ** 456,369
-----------
Total assets held for investment purposes $34,663,703
===========
*Permitted party-in-interest
**Cost information is not required for participant-directed investments and therefore is not included.
-9-
GIANT INDUSTRIES, INC. AND
AFFILIATED COMPANIES 401(k) PLAN
FORM 5500, SCHEDULE H, PART IV
SCHEDULE OF ASSETS BOTH ACQUIRED AND DISPOSED OF WITHIN THE PLAN YEAR
DECEMBER 31, 2001
Identity of
Issuer,
Borrower, Description of Investment Including
Lessor or Maturity Date, Rate of Interest, Cost of Proceeds of
Similar Party Collateral, Par or Maturity Value Acquisitions Dispositions
- ------------- ----------------------------------- ------------ ------------
*Wells Fargo Russell 2000 Index Fund for EBT -
10,593.22 shares $100,000 $ 88,030
S&P Midcap Stock Fund for EBT -
5,000 shares 50,000 43,650
S&P 500 Fund for EBT -
12,324.607 shares 485,000 412,012
-------- --------
Total $635,000 $543,692
======== ========
* Permitted party-in-interest
-10-