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