<HTML>
<HEAD>
<TITLE>S-1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As filed with the Securities and Exchange Commission on
February&nbsp;8, 2006</B>
</DIV>

<DIV align="right" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Registration
No.&nbsp;<FONT style="white-space: nowrap">333-&nbsp;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B>
</DIV>

<DIV align="center" style="font-size: 6pt;color: #000000; background: #ffffff;">
<DIV style="width: 100%; border-top: 2.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff;">
<DIV style="width: 100%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 14pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>UNITED STATES SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff;">
<B>Washington,&nbsp;D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 18pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>FORM&nbsp;<FONT style="white-space: nowrap">S-1</FONT></B>
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff;">
<B>REGISTRATION STATEMENT</B>
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff;">
<B>UNDER</B>
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff;">
<B>THE SECURITIES ACT OF 1933</B>
</DIV>

<DIV align="center" style="font-size: 24pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC.</B>
</DIV>

<DIV align="center" style="font-size: 8pt;color: #000000; background: #ffffff;">
<I>(Exact name of registrant as specified in its charter)</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 3pt; ">

<TR style="font-size: 1pt;">
    <TD width="33%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="32%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="29%">&nbsp;</TD>
</TR>

<TR>
    <TD align="center" valign="top">
    <B>Delaware</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    <B>5500</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    <B>52-2319066</B></TD>
</TR>

<TR>
    <TD align="center" valign="top">
    <I>(State or other jurisdiction of<BR>
    incorporation or organization)</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    <I>(Primary Standard Industrial<BR>
    Classification Code Number)</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    <I>(I.R.S. Employer<BR>
    Identification Number)</I></TD>
</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>830 Crescent Centre Drive, Suite&nbsp;300</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Franklin, Tennessee 37067</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(615)&nbsp;771-6701</B>
</DIV>

<DIV align="center" style="font-size: 8pt;color: #000000; background: #ffffff;">
<I>(Address, including zip code, and telephone number, including
area code, of registrant&#146;s principal executive offices)</I>
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 26%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Ezra Uzi Yemin, President and Chief Executive Officer</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Delek US Holdings, Inc.</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>830 Crescent Centre Drive, Suite&nbsp;300</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Franklin, Tennessee 37067</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(615)&nbsp;771-6701</B>
</DIV>

<DIV align="center" style="font-size: 8pt;color: #000000; background: #ffffff;">
<I>(Name, address, including zip code, and telephone number,
including area code, of agent for service)</I>
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 26%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B><I>Copies to:</I></B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 3pt; ">

<TR style="font-size: 1pt;">
    <TD width="53%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="44%">&nbsp;</TD>
</TR>

<TR>
    <TD align="center" valign="top">
    <B>Andrew C. Freedman,&nbsp;Esq.<BR>
    Mara H. Rogers,&nbsp;Esq.<BR>
    Fulbright&nbsp;&#38; Jaworski L.L.P.<BR>
    666 Fifth Avenue<BR>
    New York, New York 10103<BR>
    Telephone (212)&nbsp;318-3000<BR>
    Fax (212)&nbsp;318-3400</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    <B>D. Rhett Brandon,&nbsp;Esq.<BR>
    Simpson Thacher&nbsp;&#38; Bartlett LLP<BR>
    425 Lexington Avenue<BR>
    New York, New York 10017<BR>
    Telephone (212) 455-2000<BR>
    Fax (212) 455-2502</B></TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Approximate date of commencement of proposed sale to
public:</B> As soon as practicable after this Registration
Statement becomes effective.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to
Rule&nbsp;415 under the Securities Act of 1933, as amended (the
&#147;Securities Act&#148;), check the following
box.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="wingdings">&#111;
</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If this Form is filed to register additional securities for an
offering pursuant to Rule&nbsp;462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same
offering.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="wingdings">&#111;
</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If this Form is a post-effective amendment filed pursuant to
Rule&nbsp;462(c) under the Securities Act, check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="wingdings">&#111;
</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If this Form is a post-effective amendment filed pursuant to
Rule&nbsp;462(d) under the Securities Act, check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="wingdings">&#111;
</FONT>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CALCULATION OF REGISTRATION FEE</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 3pt; ">

<TR style="font-size: 1pt;">
    <TD width="44%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- Right VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- Right VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="26%">&nbsp;</TD>
</TR>


<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="center" nowrap><B>Title of Each Class of</B></TD>
    <TD style="border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Proposed Maximum</B></TD>
    <TD style="border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Amount of</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="center" nowrap><B>Securities to be Registered</B></TD>
    <TD style="border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Aggregate Offering Price(1)</B></TD>
    <TD style="border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Registration Fee</B></TD>
</TR>


<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Common stock, $0.01&nbsp;par value per share</DIV>
    </TD>
    <TD style="border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    $230,000,000</TD>
    <TD style="border-right:1.5pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">
    $24,610</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>

</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Estimated solely for the purpose of calculating the registration
    fee pursuant to Rule&nbsp;457(o) under the Securities Act. The
    proposed maximum aggregate offering price includes amounts
    attributed to shares of common stock that the underwriters may
    purchase if they exercise their option to purchase additional
    shares.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section&nbsp;8(a)
of the Securities Act or until the Registration Statement shall
become effective on such date as the Securities and Exchange
Commission, acting pursuant to said Section&nbsp;8(a), may
determine.</B>
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 8pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 100%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 4pt;color: #000000; background: #ffffff;">
<DIV style="width: 100%; border-top: 2.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<TABLE width="100%" cellpadding="5" style="border: 3pt double #000000; margin-bottom: 6pt; font-size: 10pt"><TR><TD>
<B><FONT style="font-size: 8pt" color="#D30547" face="helvetica,arial">The
information in this preliminary prospectus is not complete and
may be changed. We may not sell these securities until the
Registration Statement filed with the Securities and Exchange
Commission is effective. This preliminary prospectus is not an
offer to sell the securities, nor is it a solicitation of an
offer to buy the securities, in any state where an offer or sale
of the securities is not permitted.
</FONT></B>
</TD></TR></TABLE>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff; margin-top: 1pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<FONT color="#D30547">Subject to Completion,
dated &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
2006
</FONT>
</DIV>

<DIV align="left" style="font-size: 12pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
PROSPECTUS
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="g99350g9935004.gif" alt="(DELEK LOGO)">
</DIV>

<DIV align="center" style="font-size: 16pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Shares
</DIV>

<DIV align="center" style="font-size: 22pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC.</B>
</DIV>

<DIV align="center" style="font-size: 18pt;color: #000000; background: #ffffff;">
Common Stock
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 100%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
We are
selling &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of our common stock in this initial public offering. We expect
to use a portion of the net proceeds from this offering to fully
repay the outstanding intercompany indebtedness owed to our
affiliate, Delek&nbsp;&#150; The Israel Fuel Corporation Ltd.,
and to our parent, Delek Group Ltd.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Prior to this offering, Delek Group Ltd. owned indirectly all of
our capital stock. Upon completion of this offering, without
giving effect to the exercise of the underwriters&#146; option
to purchase additional shares, Delek Group Ltd. will own
approximately &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% of our common
stock. After this offering, Delek Group Ltd. will continue to
control us.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
No public market currently exists for our common stock. We
expect to apply for listing of our common stock on the New York
Stock Exchange under the symbol
&#147;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.&#148;
We currently expect that the initial public offering price will
be between
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;and
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share.
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Investing in our common stock involves risks. See &#147;Risk
Factors&#148; beginning on page&nbsp;12.</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="53%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap>Per Share</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap>Total</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Initial Public Offering Price</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Underwriting Discount</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds, before expenses, to Delek US Holdings, Inc.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
We have granted the underwriters a
<FONT style="white-space: nowrap">30-day</FONT> option to
purchase up to an aggregate
of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;additional
shares on the same terms and conditions as set forth above if
the underwriters sell more
than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock in this offering.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Lehman Brothers, on behalf of the underwriters, expects to
deliver the shares on or
about &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
2006.
</DIV>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 100%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 16pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="50%"></TD>
    <TD width="50%"></TD>
</TR>

<TR valign="top">
    <TD align="left"><B><FONT style="font-variant:SMALL-CAPS">Lehman Brothers</FONT></B></TD>
    <TD align="right"><B><FONT style="font-variant:SMALL-CAPS">Citigroup</FONT></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 12pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
2006
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">

</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<!-- TOC -->
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name="tocpage"></A>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TABLE OF CONTENTS</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="90%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Page</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#101'>Prospectus Summary</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#102'>Risk Factors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#103'>Cautionary Statement Regarding
    Forward-Looking Statements</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#104'>Use of Proceeds</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#105'>Dividend Policy</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#106'>Capitalization</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#107'>Dilution</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#108'>Selected Historical Consolidated Financial
    Information</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#109'>Unaudited Pro Forma Condensed Consolidated
    Financial Data</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#110'>Management&#146;s Discussion And Analysis
    Of Financial Condition And Results Of Operations</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#111'>Our Industry</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>71</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#112'>Business</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#113'>Management</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>97</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#114'>Principal Stockholders</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>107</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#115'>Certain Relationships and Related
    Transactions</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>109</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#116'>Description of Capital Stock</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>112</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#117'>Shares Eligible for Future Sale</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>116</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#118'>Material United States Federal Income Tax
    Considerations to Non-U.S.&nbsp;Holders</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>118</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#119'>Underwriting</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>121</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#120'>Legal Matters</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#121'>Change in Accountants</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#122'>Experts</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>125</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#123'>Where You Can Find More Information</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>126</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#124'>Glossary of Selected Terms</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>127</TD>
    <TD>&nbsp;</TD>
</TR>

<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w1.txt">EX-10.1: EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w1wa.txt">EX-10.1.A: AMENDMENT TO EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w1wb.txt">EX-10.1.B: AMENDMENT TO EMPLOYMENT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w2.txt">EX-10.2: CONSULTING AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w5.txt">EX-10.5: DISTRIBUTION SERVICE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w6.txt">EX-10.6: RPC AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w6wa.txt">EX-10.6.A: ASSIGNMENT AND ASSUMPTION AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w6wb.txt">EX-10.6.B: ASSIGNMENT OF THE RPC AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w7.txt">EX-10.7: AMENDED AND RESTATED CREDIT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w7wa.txt">EX-10.7.A: 1ST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w7wb.txt">EX-10.7.B: 2ND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w7wc.txt">EX-10.7.C: 3RD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w8.txt">EX-10.8: AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w8wa.txt">EX-10.8.A: FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w9.txt">EX-10.9: STOCK PURCHASE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w10.txt">EX-10.10: REFINERY PURCHASE AND SALE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w10wa.txt">EX-10.10.A: AMENDMENT TO REFINERY PURCHASE AND SALE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w10wb.txt">EX-10.10.B: SECOND AMENDMENT TO REFINERY PURCHASE AND SALE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w11.txt">EX-10.11: PIPELINE CAPACITY LEASE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w11wa.txt">EX-10.11.A: ONE-YEAR RENEWAL OF PIPELINE CAPACITY LEASE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w11wb.txt">EX-10.11.B: ASSIGNMENT OF THE PIPELINE CAPACITY LEASE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w11wc.txt">EX-10.11.C: AMENDMENT TO ONE-YEAR RENEWAL OF PIPELINE CAPACITY LEASE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w11wd.txt">EX-10.11.D: EXTENSION OF PIPELINE CAPACITY LEASE AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w12.txt">EX-10.12: BRANDED JOBBER CONTRACT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv10w15.txt">EX-10.15:MANAGEMENT AND CONSULTING AGREEMENT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv16w1.txt">EX-16.1: LETTER RE CHANGE IN CERTIFYING ACCOUNTANT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv16w2.txt">EX-16.2: LETTER RE CHANGE IN CERTIFYING ACCOUNTANT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv21w1.txt">EX-21.1: SUBSIDIARIES OF THE REGISTRANT</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv23w2.txt">EX-23.2: CONSENT OF ERNST AND YOUNG LLP</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv23w3.txt">EX-23.3: CONSENT OF ERNST AND YOUNG LLP</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv23w4.txt">EX-23.4 CONSENT OF ERNST AND YOUNG LLP</A></FONT></TD></TR>
<TR><TD colspan="9"><FONT size="2">&nbsp;<A HREF="g99350exv23w5.txt">EX-23.5: CONSENT OF MAYER HOFFMAN MCCANN PC</A></FONT></TD></TR>
</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<!-- /TOC -->
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 26%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>You should rely only on the information contained in this
prospectus or to which we have referred you. We have not
authorized anyone to provide you with information that is
different from that contained in this prospectus. This
prospectus may only be used where it is legal to sell these
securities. The information in this prospectus may be accurate
only on the date of this prospectus regardless of the time of
delivery of this prospectus.</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Dealer Prospectus Delivery Obligation</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>Until &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
2006 (the 25th&nbsp;calendar day after date of this prospectus),
all dealers that effect transactions in these securities,
whether or not participating in this offering, may be required
to deliver a prospectus. This is in addition to the
dealer&#146;s obligation to deliver a prospectus when acting as
an underwriter and with respect to unsold allotments or
subscriptions.</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Industry and Market Data</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This prospectus includes market share and industry data that we
obtained from internal research, publicly available information
and industry publications and surveys. Our internal research is
based upon management&#146;s understanding of industry
conditions and has not been verified by any independent sources.
Industry surveys and publications generally state that the
information contained therein has been obtained from sources
believed to be reliable. Neither we nor the underwriters make
any representation as to the accuracy of such information.
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Trademarks, Trade Names and Servicemarks</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This prospectus includes trademarks, trade names and
servicemarks of Delek US Holdings, Inc. and its subsidiaries.
This prospectus also refers to trademarks, trade names and
servicemarks of other entities. All rights are reserved. The
mention of such trademarks, trade names and servicemarks in this
prospectus is made with due recognition of the rights of these
entities and without any intent to misappropriate such names or
marks. All other trademarks, trade names and servicemarks
appearing in the registration statement are the property of
their respective owners.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>General</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We conduct our business primarily through our operating
subsidiaries, each of which is a direct or indirect wholly-owned
subsidiary of Delek US Holdings, Inc. For purposes of this
prospectus, unless the context otherwise requires, all
references herein to &#147;our company,&#148; &#147;Delek,&#148;
&#147;we,&#148; &#147;us&#148; and &#147;our&#148; refer to
Delek US Holdings, Inc. and its consolidated subsidiaries and
their predecessors. In addition, unless otherwise specified, all
references in this prospectus to the number of stores that we
own or operate or to the number of dealer-operated retail
locations are as of December&nbsp;15, 2005. You should refer to
the &#147;Glossary of Selected Terms&#148; beginning on
page&nbsp;127 for definitions of some of the terms we use to
describe our business and industry.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">ii

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='101'></A>
</DIV>

<!-- link1 "PROSPECTUS SUMMARY" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PROSPECTUS SUMMARY</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>This summary highlights information contained elsewhere in
this prospectus but might not contain all of the information
that is important to you. Before investing in our common stock,
you should read the entire prospectus carefully, including the
&#147;Risk Factors&#148; section and our historical and pro
forma consolidated financial statements and the notes thereto
included elsewhere in this prospectus.</I>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Unless otherwise indicated, the information contained in this
prospectus assumes that the underwriters&#146; option to
purchase additional shares is not exercised.</I>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Our Company</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Company Overview</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a diversified energy business focused on petroleum
refining and supply and on retail marketing. Our business
consists of two main operating segments: refining and retail.
Our refining segment operates a high conversion, moderate
complexity independent refinery in Tyler, Texas. Our retail
segment markets gasoline, diesel and other refined petroleum
products and convenience merchandise through a network of
349&nbsp;company-operated retail fuel and convenience stores. We
also have a wholesale fuel distribution operation. Since our
founding in 2001, we have grown rapidly through the acquisition
of refining and convenience store-related assets. We believe
that our performance-driven, results-oriented corporate culture
is a key element of our success in executing our strategy and
achieving competitive advantages.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refining segment.</I> Our refining segment operates a high
conversion, moderate complexity independent refinery with a
design crude distillation capacity of 60,000&nbsp;barrels per
day, or bpd, along with an associated crude oil pipeline and
light products loading facilities. The Tyler refinery includes a
fluidized catalytic cracking unit and a delayed coker, enabling
us to produce over 93% light products and less than 2% heavy oil
products. The refinery is located in the city of Tyler in East
Texas, and is the only supplier of a full range of refined
petroleum products within a radius of approximately
115&nbsp;miles of its location. Crude oil, most of which is
produced locally, is delivered to the Tyler refinery primarily
by pipeline, either through 65&nbsp;miles of Delek-owned
pipeline or a third-party pipeline that we lease. The Tyler
refinery has the ability to produce and sell a full range of
gasoline, diesel, jet fuels and petrochemical feedstocks. The
Tyler refinery&#146;s refined petroleum products are marketed
through our truck loading facilities and third-party pipelines
directly to major oil companies such as ExxonMobil and Chevron,
independent refiners and marketers such as Valero, and jobbers,
distributors, utility and transportation companies and
independent retail fuel operators.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Retail segment.</I> Our retail segment markets gasoline,
diesel and other refined petroleum products and convenience
merchandise through our network of 349&nbsp;company-operated
retail fuel and convenience stores located in Alabama, Arkansas,
Georgia, Kentucky, Louisiana, Mississippi, Tennessee and
Virginia. Our stores operate primarily under the MAPCO
Express<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
East
Coast<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
and Discount Food
Mart<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
brands. Approximately 93% of our stores are concentrated in
Tennessee, Alabama and Virginia. Our stores market gasoline and
diesel under our fuel brands as well as the
BP<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
Exxon<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
Shell<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
and
Chevron<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
brands. We also market a broad selection of beverages and
merchandise designed to appeal to the convenience needs of our
customers. In addition, we have begun to sell proprietary food
offerings under our Grille
Marx<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
brand. We also have a wholesale fuel distribution operation that
supplies more than 50 dealer-operated retail locations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For the nine months ended September&nbsp;30, 2005 and the year
ended December&nbsp;31, 2004, we generated net sales of
$1.4&nbsp;billion and $857.9&nbsp;million, respectively, net
income of $39.5&nbsp;million and $7.3&nbsp;million,
respectively, and Adjusted EBITDA of $98.5&nbsp;million and
$31.9&nbsp;million, respectively. Our results for the nine
months ended September&nbsp;30, 2005 reflect the operations of
the Tyler refinery since we acquired it on April&nbsp;29, 2005.
See &#147;&#151;&nbsp;Summary Consolidated Financial Information
and Other Data&#148; and &#147;Selected Historical Consolidated
Financial Information&#148; for our calculation of Adjusted
EBITDA, as well as a reconciliation of Adjusted EBITDA amounts
to net income, the most directly comparable generally accepted
accounting principles, or GAAP, measure.
</DIV>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">1

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Market Opportunities</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe the following factors create a positive outlook for
our business:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Major oil and gas companies and retailers continue to divest
refining and retail assets.</I> Over the past few years, several
major oil and gas companies and retailers have divested
portfolios of refining and retail assets. We believe that major
oil and gas companies and retailers will continue to divest
refining and retail assets to free their capital and
managements&#146; attention for larger scale investment
opportunities, thus providing us with attractive acquisition and
growth opportunities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Substantial opportunities for consolidation in the
U.S.&nbsp;convenience store industry.</I> The
U.S.&nbsp;convenience store industry is highly fragmented. We
believe that smaller operators typically do not have the
combination of operational and financial resources necessary to
implement the marketing strategies and information technology
systems that companies of our size do, and that they do not
enjoy our economies of scale when negotiating contracts, such as
contracts for merchandise or fuel supply. We believe that these
smaller operators are at a competitive disadvantage to us and
that we will continue to be presented with additional
acquisition opportunities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Favorable supply/demand dynamics in the U.S.&nbsp;refining
sector.</I> We believe that high capital costs and environmental
regulatory requirements have limited the growth of refining
capacity, the construction of new refineries and the expansion
of existing refineries in the United States over the past
30&nbsp;years. We believe that limited refining capacity in the
United States, along with increasing utilization rates and
steadily increasing demand for refined petroleum products, has
produced a sustainable shift in market dynamics that will
benefit our refining segment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Expansion opportunities beyond our current geographic
footprint.</I> Our retail business is currently concentrated in
the southeastern United States, especially in Tennessee, Alabama
and Virginia. We believe that states adjacent to those in which
we currently operate, or in which we currently have a relatively
small number of stores, such as Florida, North Carolina, South
Carolina, Arkansas, Georgia, Mississippi, Kentucky, Louisiana
and Texas, provide opportunities for us to expand.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Competitive Advantages</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe we enjoy the following competitive advantages:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Proven ability to integrate acquisitions.</I> We have been
successful in rapidly integrating our refinery acquisition, four
large retail fuel and convenience store acquisitions and several
smaller acquisitions since our formation in 2001. Since our
acquisition of the Tyler refinery, we have implemented
managerial and operational enhancements that have resulted in
increased refinery utilization, an increase in our truck rack
margins and expansion of our customer base. We have also
improved the productivity and profitability of the convenience
stores we acquired by implementing merchandising and fuel sales
initiatives, instituting operating expense and loss prevention
controls, reducing overhead and centralizing functions such as
accounting, purchasing and information technology.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Niche market refinery.</I> Our Tyler refinery is located in a
niche market and primarily produces high value transportation
fuels. Our Tyler refinery is the only supplier of a full range
of refined petroleum products within a radius of approximately
115&nbsp;miles of its location. Our owned and leased pipelines
are connected to five crude oil pipeline systems that provide us
access to East Texas, West Texas and other domestic and foreign
crude oils. The refinery owns the larger of two truck rack
facilities for the loading of transportation fuels in the
vicinity of Tyler, Texas and supplies the other one. We believe
this provides us with a cost advantage over other companies that
would need to import fuel via truck from outside the region.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Management focus and merchandising and operations
expertise.</I> We believe that our management approach
encourages employee participation in decision-making. This
approach allows us to identify market trends and opportunities
and to rapidly implement store specific strategies and programs
to exploit those trends and opportunities to improve results of
operations at our stores. Human and technological intelligence
is key to our retail business strategy, which is based on the
concept of the &#147;neighborhood&#148; store. Our
</DIV>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">2

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
management approach also incorporates a strong focus on
controlling operating expenses and loss prevention, which has
been an important element in the successful development of our
retail segment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Strong market presence in our existing retail markets.</I>
&#147;MAPCO&#148; is a well-recognized name throughout the
southeastern United States, and our &#147;East Coast&#148; and
&#147;Discount Food Mart&#148; brands are well known in Virginia
and Alabama, the respective markets in which we operate. We
believe that we rank first among convenience store operators in
terms of the number of stores in each of the Nashville, Memphis
and Northern Alabama regions and third among convenience store
operators in the Richmond, Virginia region. This concentration
of stores enables us to realize economies of scale and
cost-efficiencies and provides us with a platform for continued
growth through acquisitions in these core regions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Scalable information technology.</I> We believe that our
information technology systems allow us to maximize sales and
margins and reduce inefficiencies in our cost structure by
delivering timely and focused feedback on margins and sales
volumes, enabling our merchandising managers to react quickly to
maximize our profit opportunities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Experienced Management.</I> We believe that our strong
management is a key element of our competitive advantages and
our ability to continue to successfully execute our strategies.
The management teams of both our refining and retail segments
have extensive industry experience, which includes a strong
cross-section of disciplines, including marketing, operations,
finance and information technology.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Strategy</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to strengthen our market position, enhance growth and
maximize our profitability and cash flow, we intend to:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Pursue opportunistic acquisitions that strengthen our core
markets and leverage our core competencies.</I> We have a track
record of expanding our business through asset acquisitions. As
we seek to grow, we will opportunistically target assets or
businesses where we can apply our core competencies. Our goal is
to continue to expand our retail business through acquisitions
and new store development, and we intend to actively pursue
additional refinery acquisitions. We also plan to selectively
pursue additional acquisitions of logistic and other assets
complementary to our refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Modernize and improve the profitability of our Tyler
refinery.</I> We have implemented, and intend to continue to
implement, operational changes and capital investments to
improve the efficiency, processing capacity and utilization of
our Tyler refinery. Our management team has begun to and will
continue to source new crude supplies, including foreign crude,
to provide us with greater flexibility in optimizing the
feedstock supply to the Tyler refinery. We believe that our
operational improvements and increased crude oil delivery
capacity will allow us to increase the Tyler refinery&#146;s
average crude oil throughput from historic levels of
approximately 50,000&nbsp;bpd to almost 60,000&nbsp;bpd by early
2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Grow the customer base and improve the profitability of our
Tyler-area niche market.</I> We believe that there is additional
demand in the Tyler, Texas area for products produced at our
Tyler refinery. We plan to continue to target potential
customers who currently have supply contracts with others but
may be interested in purchasing from us. In addition to
increasing sales, our management team intends to continue
renegotiating marketing contracts on more favorable terms, in
order to further benefit from the competitive advantage we have
in our niche market location.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Reinforce our brand recognition through targeted retail
merchandising strategies.</I> We intend to maintain our position
as a strong retail competitor in the southeastern United States.
To increase brand awareness in our markets, we are in the
process of implementing a new branding and re-imaging campaign
that will include the retrofitting of select existing stores and
the building of new stores with the &#147;MAPCO Mart&#148;
brand. We aim to maintain our existing customer base while
attracting a more upscale clientele to our re-imaged stores.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Continually renew the physical assets of our retail
business.</I> We intend to ensure that our retail stores are
positioned to maximize customer traffic and provide our
consumers with an enhanced purchasing
</DIV>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">3

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
experience. We believe that upgrading our retail stores, as well
as closing or selling underperforming stores, will lead to
improved operating results.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Develop innovative information technology applications in all
of our businesses.</I> We intend to continue our investment in
technological infrastructure. We believe that by leveraging our
innovative information technology platform, we will be able to
better address the needs of our customers. By optimizing our
information technology, we also expect to improve our operating
efficiencies and to improve our management of inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Summary Risks</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our business is subject to numerous risks as discussed more
fully in the section entitled &#147;Risk Factors&#148;
immediately following this Prospectus Summary. We believe that
the most significant of these risks include the following:
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    competition;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    changes in, or the failure to comply with, the extensive
    government regulations applicable to our industry segments;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the availability, cost and price volatility of crude oil, other
    refinery feedstocks and refined petroleum products;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to integrate acquired businesses and implement our
    growth strategy;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    general economic and business conditions, particularly levels of
    spending relating to travel and tourism or conditions affecting
    the southeastern United States;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    dependence on one principal fuel supplier and one wholesaler for
    a significant portion of our convenience store merchandise;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    operating hazards, natural disasters, casualty losses and other
    matters beyond our control;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in our debt levels and restrictive covenants in our
    debt agreements;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    potential conflicts of interest between our major stockholder
    and other stockholders; and</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our discretion in the use of net proceeds from this offering.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Company History</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a Delaware corporation formed in April 2001. We are an
indirect wholly-owned subsidiary of Delek Group Ltd., a
conglomerate that is domiciled and publicly traded in Israel,
which has significant interests in fuel supply businesses and
which is controlled by Mr.&nbsp;Yitzchak Sharon Teshuva, an
Israeli citizen. We were formed by Delek Group Ltd. in
connection with our acquisition in May 2001 of 198 retail fuel
and convenience stores from a subsidiary of The Williams
Companies. Since then, we have completed several other
acquisitions of retail fuel and convenience stores. In 2005, we
expanded our scope of operations to include complementary
petroleum refining and wholesale and distribution businesses by
acquiring the Tyler refinery.
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Corporate Information</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our principal executive offices are located at 830 Crescent
Centre Drive, Suite&nbsp;300, Franklin, Tennessee 37067, and our
telephone number at that address is (615)&nbsp;771-6701. Our
website is located at www.delekus.com. Information contained on
our website does not constitute a part of this prospectus.
</DIV>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">4

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>The Offering</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    Common stock offered</TD>
    <TD></TD>
    <TD valign="top">
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Common stock to be outstanding after the offering</TD>
    <TD></TD>
    <TD valign="top">
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares(1)</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Underwriters&#146; option(1)</TD>
    <TD></TD>
    <TD valign="top">
    We have granted the underwriters a
    <FONT style="white-space: nowrap">30-day</FONT> option to
    purchase from us up to an aggregate
    of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;additional
    shares of our common stock if they sell more
    than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    in the offering.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Use of proceeds</TD>
    <TD></TD>
    <TD valign="top">
    We estimate that the net proceeds to us from this offering will
    be approximately
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.
    We expect to use a portion of the net proceeds from this
    offering to repay $52.5&nbsp;million principal amount of our
    debt, plus accrued interest, of which $42.5&nbsp;million, plus
    accrued interest, is owed to our affiliates. We expect to use
    the remainder of the net proceeds for general corporate
    purposes, including working capital, capital expenditures and
    possible acquisitions.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Dividend policy</TD>
    <TD></TD>
    <TD valign="top">
    We currently intend to pay quarterly cash dividends on our
    common stock at an initial annual rate of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share
    commencing &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.
    The declaration and payment of future dividends to holders of
    our common stock will be at the discretion of our board of
    directors and will depend upon many factors, including our
    results of operations, financial condition, earnings, capital
    requirements, restrictions in our debt agreements and legal
    requirements.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Proposed New York Stock Exchange (&#147;NYSE&#148;) symbol</TD>
    <TD></TD>
    <TD valign="top">
</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    Risk factors</TD>
    <TD></TD>
    <TD valign="top">
    An investment in our common stock involves a high degree of
    risk. You should carefully consider the risk factors set forth
    under &#147;Risk Factors&#148; beginning on page&nbsp;12 and the
    other information contained in this prospectus prior to making
    an investment decision regarding our common stock.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    The number of shares of common stock to be outstanding after the
    offering:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    gives effect to a &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-for-one stock
    split of our common stock, which will be effective immediately
    prior to this offering;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT>
    registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> we intend
    to file within 30&nbsp;days after the completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    assumes no exercise by the underwriters of their option to
    purchase up
    to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;additional
    shares of common stock from us if they sell more
    than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    in the offering.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">5

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Summary Consolidated Financial Information and Other Data</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth our summary historical
consolidated financial information and other data. The
historical statement of operations and cash flow data for the
fiscal years ended December&nbsp;31, 2002, 2003 and 2004 are
derived from, and should be read in conjunction with, our
audited consolidated financial statements and related notes
appearing elsewhere in this prospectus. The historical statement
of operations and cash flow data for the nine months ended
September&nbsp;30, 2004 and September&nbsp;30, 2005 and the
historical balance sheet data as of September&nbsp;30, 2005 are
derived from our unaudited consolidated financial statements
appearing elsewhere in this prospectus, which, in the opinion of
management, include all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the data for
the periods presented. The results of operations for the interim
period are not necessarily indicative of the operating results
for the entire year or any future period. Additionally, our
financial condition and results of operations for certain
periods may not be comparable due to the acquisition of
Williamson Oil Co., Inc. effective April&nbsp;30, 2004, the
acquisition of the Tyler refinery and related assets effective
April&nbsp;29, 2005, various refinancings of indebtedness and
other transactions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The information contained in this table should also be read in
conjunction with &#147;Use of Proceeds,&#148;
&#147;Capitalization,&#148; &#147;Selected Historical
Consolidated Financial Information,&#148; &#147;Unaudited Pro
Forma Condensed Consolidated Financial Data,&#148;
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations&#148; and the consolidated
financial statements and accompanying notes thereto, all
included elsewhere in this prospectus.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="36%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Statement of Operations Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>857,834</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>617,955</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$798,974</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refining</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>588,326</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>241</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>857,899</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>617,971</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>460,337</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>500,181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>730,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>526,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,704</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80,060</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58,289</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,227</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,122</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,665</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,674</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>542,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>584,113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>837,438</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>603,695</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,309,575</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,592</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,044</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,276</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,059</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense-related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,210</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>778</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,287</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on derivative instruments(5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees(6)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,330</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,996</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,654</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,817</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">6

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="39%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before income taxes and cumulative effect of
    change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(738</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,622</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,149</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,787</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(474)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,520</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings (loss) per share(7)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average shares, basic and diluted(7)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash Flow Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>17,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>26,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,926</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>16,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$139,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,066</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(16,149</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(27,343</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(26,763</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(83,588</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,465</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,616</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,962</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,279</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (decrease) increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>7,942</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,199</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,417</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$124,921</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Segment Data&nbsp;(8):</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="41%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>Nine Months Ended September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Corporate,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Other and</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Refining(2)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retail</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Eliminations(9)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Consolidated</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales (excluding intercompany sales)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$588,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$798,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$241</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Intercompany sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>489,401</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>690,982</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,636</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,402</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>248</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Segment contribution margin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$72,177</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$43,590</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(7</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,760</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">7

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="38%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except pricing information)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Other Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjusted EBITDA(10)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$15,018</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$24,398</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$31,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,723</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$98,456</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital expenditures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,832</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,415</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Key Operating Statistics:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    REFINING SEGMENT</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Days operated in period(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>155</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total sales volume (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,646</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Products manufactured (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gasoline</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,366</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Diesel/Jet</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,288</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petrochemicals, LPG, NGLs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,517</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,061</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total production</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,232</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Throughput (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,887</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other feedstocks</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>878</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total throughput</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Per barrel of sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refining operating margin(11)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$12.23</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Direct operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$3.39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    RETAIL SEGMENT</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Number of stores (end of period)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>243</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>328</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average number of stores</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>242</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>310</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>329</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel sales (thousands of gallons)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,396</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,476</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>315,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>231,315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>249,507</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average retail gallons per average number of stores (in
    thousands)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,133</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>766</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>758</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel margin (per gallon)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.130</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.155</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.164</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$204,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$206,950</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$261,232</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$191,728</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$219,840</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise margin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26.7</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

</TABLE>
</CENTER>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="46%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>As of September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Actual</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As Adjusted(12)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As Further Adjusted(13)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance Sheet Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>147,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>104,527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total debt, including current maturities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>275,178</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">8

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff;">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="1%"></TD>
    <TD width="3%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;30, 2004, we completed the acquisition of
    100% of the outstanding stock of Williamson Oil Co., Inc., or
    Williamson Oil. Because the results of operations of Williamson
    Oil are included in our financial results from the date of
    acquisition, a comparison of our
    <FONT style="white-space: nowrap">period-to</FONT>-period
    financial results may not necessarily be meaningful. See
    &#147;Unaudited Pro Forma Condensed Consolidated Financial
    Data,&#148; which shows what our results of operations might
    have been had we acquired Williamson Oil on January&nbsp;1, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155&nbsp;days in the fiscal period ended
    September&nbsp;30, 2005. Because the results of operations of
    the Tyler refinery and related assets are included in our
    financial results from the date of acquisition, a comparison of
    our <FONT style="white-space: nowrap">period-to</FONT>-period
    financial results may not necessarily be meaningful. See
    &#147;Unaudited Pro Forma Condensed Consolidated Financial
    Data,&#148; which shows what our results of operations might
    have been in 2004 and the nine months ended September&nbsp;30,
    2005 had we acquired the Tyler refinery and related assets on
    January&nbsp;1, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    In order to mitigate the risks of changes in the market price of
    crude oil and refined petroleum products, we entered into
    forward contracts to fix the purchase price of crude and sales
    price of specific refined petroleum products for a predetermined
    number of units at a future date. The fair value adjustment of
    these contracts in the third quarter of 2005 resulted in a loss
    of $10.9&nbsp;million. These contracts were entered into with an
    affiliate of Citigroup Global Markets Inc., one of the
    underwriters of this offering.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    In 2005, we refinanced a significant portion of our existing
    debt. As a result, financing costs associated with the
    refinanced debt were written-off.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(5)&nbsp;</TD>
    <TD align="left">
    We have entered into interest rate swap and cap agreements in
    connection with a portion of our floating rate debt. These
    interest rate swap and cap agreements are marked to fair value
    each period.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(6)&nbsp;</TD>
    <TD align="left">
    In 2005, our parent company guaranteed a portion of our new debt
    and other instruments in connection with the acquisition of the
    Tyler refinery. We have agreed to pay our parent a fee for these
    guarantees.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(7)&nbsp;</TD>
    <TD align="left">
    Gives effect to
    a &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT style="white-space: nowrap">for-one</FONT>
    split of our common stock, which will be effective immediately
    prior to this offering.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(8)&nbsp;</TD>
    <TD align="left">
    Statement of Accounting Standards No.&nbsp;131, <I>Disclosures
    About Segments of an Enterprise and Related Information,</I>
    requires disclosure of a measure of segment profit or loss. In
    connection with the purchase of the Tyler refinery and related
    assets on April&nbsp;29, 2005, management began viewing our
    company&#146;s operating results in two reportable segments:
    retail and refining. We measure the operating performance of
    each segment based on segment contribution margin. We define
    segment contribution margin as net sales less cost of goods sold
    and operating expenses, excluding depreciation and amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    For the retail segment, cost of goods sold comprises the costs
    of specific products sold. Operating expenses include costs such
    as wages of employees at the stores, lease expense for the
    stores, utility expense for the stores and other costs of
    operating the stores, excluding depreciation and amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    For the refining segment, cost of goods sold includes all the
    costs of crude oil, feedstocks and related transportation.
    Operating expenses include the costs associated with the actual
    operations of the refinery, excluding depreciation and
    amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    Prior to the purchase of the Tyler refinery and related assets,
    we had only the retail segment. Accordingly, segment data prior
    to 2005 is not applicable.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(9)&nbsp;</TD>
    <TD align="left">
    Consists of fuel credit card services provided by one of our
    subsidiaries and eliminations of intercompany transactions.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(10)&nbsp;</TD>
    <TD align="left">
    EBITDA represents earnings before income tax expense, interest
    expense, the write-off of deferred financing costs, (gain) loss
    on derivative instruments, guarantee fees, depreciation and
    amortization. Adjusted EBITDA represents earnings before income
    tax expense, interest expense, the write-off of deferred
    financing costs, (gain)&nbsp;loss on derivative instruments,
    losses on forward contract activities,</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">9

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD align="left">
    guarantee fees, depreciation, amortization and (gain) loss on
    disposal of assets. EBITDA and Adjusted EBITDA, however, are not
    recognized measurements under GAAP. Our management believes that
    the presentation of Adjusted EBITDA is useful to investors
    because it is frequently used by securities analysts, investors
    and other interested parties in the evaluation of companies in
    our industry.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    In addition, our management believes that Adjusted EBITDA is
    useful in evaluating our operating performance compared to that
    of other companies in our industry because the calculation of
    Adjusted EBITDA generally eliminates the effects of financings,
    income taxes, risk management activities and the disposal of
    assets, items which may vary for different companies for reasons
    unrelated to overall operating performance.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA has limitations as an analytical tool, and you
    should not consider it in isolation, or as a substitute for
    analysis of our results as reported under GAAP. Some of these
    limitations are:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or contractual commitments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA does not reflect the interest expense or the
    cash requirements necessary to service interest or principal
    payments on our debt;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA does not reflect changes in or cash requirements
    for our working capital needs;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Our calculation of Adjusted EBITDA may differ from the EBITDA
    and Adjusted EBITDA calculations of other companies in our
    industry, limiting its usefulness as a comparative measure.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    Because of these limitations, Adjusted EBITDA should not be
    considered a measure of discretionary cash available to us to
    invest in the growth of our business. We compensate for these
    limitations by relying primarily on our GAAP results and using
    Adjusted EBITDA only on a supplemental basis.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    The following table reconciles net income (loss) to Adjusted
    EBITDA for the periods presented:</TD>
</TR>

</TABLE>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="50%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Net income (loss)</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>39,520</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,269</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,779</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,052</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on derivative instruments(5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees(6)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,674</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    EBITDA</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,018</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24,828</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32,835</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,950</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>89,171</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Adjusted EBITDA</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>15,018</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,398</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>22,723</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>98,456</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(11)&nbsp;</TD>
    <TD align="left">
    Refining operating margin per barrel is calculated by dividing
    the margin between net sales and cost of crude oil, feedstocks
    and related transportation by the total barrels sold at our
    refinery. Industry-wide refining results are driven and measured
    by the margins between refined petroleum product prices and the
    prices for crude oil, which are referred to as crack spreads:
    the differential in price between a representative barrel of
    benchmark refined petroleum products, such as gasoline or
    heating oil, and a barrel of benchmark crude oil. The
    US&nbsp;Gulf
    Coast&nbsp;<FONT style="white-space: nowrap">5-3-2</FONT> crack
    spread represents the differential between Platt&#146;s
    quotations for
    <FONT style="font-size: 70%"><SUP>3</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of US&nbsp;Gulf Coast Pipeline&nbsp;87 Octane
    Conventional Gasoline and
    <FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of US&nbsp;Gulf Coast Pipeline No.&nbsp;2 Heating
    Oil (high sulfur diesel) on the one hand, and the</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">10

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="width: 100%; border: 1px solid black; padding: 12px;">

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD align="left">
    first month futures price of
    <FONT style="font-size: 70%"><SUP>5</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of light sweet crude oil on the New York Mercantile
    Exchange, on the other hand. We compare our refining operating
    margin to these crack spreads to assess our operating
    performance relative to other participants in our industry.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(12)&nbsp;</TD>
    <TD align="left">
    As adjusted to give effect to the following transactions as if
    such transactions had occurred on September&nbsp;30, 2005: the
    prepayment, on November&nbsp;23, 2005, of $17.5&nbsp;million of
    principal on the $35.0&nbsp;million promissory note dated
    April&nbsp;27, 2005 payable to Delek Group Ltd.; the prepayment,
    on November&nbsp;23, 2005, of $10.0&nbsp;million of principal on
    the $30.0&nbsp;million promissory note dated April&nbsp;26, 2005
    payable to Israel Discount Bank; the prepayment, on
    November&nbsp;23, 2005, of $10.0&nbsp;million of principal on
    the $20.0&nbsp;million promissory note dated April&nbsp;27, 2005
    payable to Bank Leumi USA; and our acquisition of retail fuel
    and convenience stores and other assets from BP Products North
    America, Inc., or BP, in December 2005 for $35.0&nbsp;million,
    of which $5.0&nbsp;million was financed with cash on hand and
    $30.0&nbsp;million was financed from borrowings under our
    revolving credit facility.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(13)&nbsp;</TD>
    <TD align="left">
    As further adjusted to reflect our sale
    of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of our common stock at a price of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share, the midpoint of the range set forth on the cover page of
    this prospectus and our use of proceeds, net of estimated
    underwriting discounts and commissions and estimated offering
    expenses that are payable by us.</TD>
</TR>

</TABLE>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">11

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='102'></A>
</DIV>

<!-- link1 "RISK FACTORS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>RISK FACTORS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>An investment in our common stock involves various risks.
Before making an investment in our common stock, you should
carefully consider the following risks, as well as the other
information contained in this prospectus, including our
consolidated financial statements and the notes thereto and
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations.&#148; The risks described
below are those which we believe are the material risks we face.
Any of the risk factors described below or additional risks and
uncertainties not presently known to us, or that we currently
deem immaterial, could have a material adverse effect on our
business, financial condition and results of operations. As a
result, the trading price of our common stock could decline and
you may lose a part or all of your investment.</I>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Risks Relating to Our Industry</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We operate in a highly competitive industry, and
    competitive pressures may adversely affect us.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We compete with a broad range of companies in our refining and
petroleum product marketing operations. Many of these
competitors are integrated, multinational oil companies that are
substantially larger than we are. Because of their diversity,
integration of operations, larger capitalization, larger and
more complex refineries and greater resources, these companies
may be better able to withstand volatile market conditions, to
compete on the basis of price and to obtain crude oil in times
of shortage.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The industry and geographic areas in which we operate our retail
fuel and convenience stores are highly competitive and marked by
ease of entry and constant change in the number and type of
retailers offering the products and services found in our
stores. We compete with other convenience store chains, gas
stations, supermarkets, drug stores, discount stores, club
stores, mass merchants, fast food operations and other retail
outlets. In some of our markets, our competitors have been in
existence longer and have greater financial, marketing and other
resources than we do. As a result, our competitors may be able
to respond better to changes in the economy and new
opportunities within the industry.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In recent years, several non-traditional retailers, such as
supermarkets, club stores and mass merchants, have affected the
convenience store industry by entering the retail fuel business.
These non-traditional gasoline retailers have obtained a
significant share of the motor fuels market and we expect their
market share to grow. Because of their diversity, integration of
operations, experienced management and greater resources, these
companies may be better able to withstand volatile market
conditions or levels of low or no profitability in the retail
segment. In addition, these retailers may use promotional
pricing or discounts, both at the pump and in the store, to
encourage in-store merchandise sales. These activities by our
competitors could pressure us to offer similar discounts,
adversely affecting our profit margins. Additionally, the loss
of market share by our retail fuel and convenience stores to
these and other retailers relating to either gasoline or
merchandise could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Independent owner-operators can operate stores with lower
overhead costs than ours. Should significant numbers of
independent owner-operators enter our market areas, retail
prices in some of our categories may be negatively affected, as
a result of which our profit margins may decline at affected
stores.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our stores compete, in large part, based on their ability to
offer convenience to customers. Consequently, changes in traffic
patterns and the type, number and location of competing stores
could result in the loss of customers and reduced sales and
profitability at affected stores. Other major competitive
factors include ease of access, pricing, timely deliveries,
product and service selections, customer service, fuel brands,
store appearance, cleanliness and safety.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We operate in a highly regulated industry and increased
    costs of compliance with, or liability for violation of,
    existing or future laws, regulations and other requirements
    could significantly increase our costs of doing business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our industry is subject to extensive laws, regulations and other
requirements including, but not limited to, those relating to
environmental, employment, labor, immigration, minimum wages and
overtime pay, health benefits, working conditions, public
accessibility, the sale of alcohol and tobacco and other
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">12

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
requirements. A violation of any of these requirements could
have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under various federal, state and local environmental
requirements, as the owner or operator of our locations, we may
be liable for the costs of removal or remediation of
contamination at our existing or former locations, whether we
knew of, or were responsible for, the presence of such
contamination. We have incurred such liability in the past and
several of our current and former locations are the subject of
ongoing remediation projects. The failure to timely report and
properly remediate contamination may subject us to liability to
third parties and may adversely affect our ability to sell or
rent our property or to borrow money using our property as
collateral. Additionally, persons who arrange for the disposal
or treatment of hazardous substances also may be liable for the
costs of removal or remediation of these substances at sites
where they are located, regardless of whether the site is owned
or operated by that person. We typically arrange for the
treatment or disposal of hazardous substances in our refining
operations. We do not typically do so in our retail operations,
but we may nonetheless be deemed to have arranged for the
disposal or treatment of hazardous substances. Therefore, we may
be liable for removal or remediation costs, as well as other
related costs, including fines, penalties and damages resulting
from injuries to persons, property and natural resources.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Compliance with existing and future environmental requirements
regulating underground storage tanks may require significant
capital expenditures and increased operating and maintenance
costs. The remediation costs and other costs required to clean
up or treat contaminated sites could be substantial. We pay tank
registration fees and other taxes to state trust funds
established in states in which we operate retail fuel and
convenience stores. These state trust funds are expected to pay
or reimburse us for remediation expenses of up to
$1.0&nbsp;million per site, less a deductible. However,
reimbursement from state trust funds will be dependent on the
maintenance and continued solvency of the various funds. We have
secured insurance to cover certain costs in excess of those paid
by state underground storage tank funds. There can be no
assurance, however, that such insurance will be sufficient.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the future, we may incur substantial expenditures for
investigation or remediation of contamination that has not been
discovered at our current or former locations or locations that
we may acquire. We cannot assure you: that we have identified
all environmental liabilities at all of our current and former
locations; that material environmental conditions in addition to
those already known to us do not exist; that future requirements
will not impose material environmental liability on us; that an
undiscovered material environmental condition does not otherwise
exist as to any one or more of our locations; or that we will
not incur significant fines or penalties or be required to
significantly reduce operations as a result of any noncompliance
with environmental requirements. In addition, any failure by us
to comply with any environmental requirements or with any
expanded environmental requirements could have a material
adverse effect on our business, financial condition and results
of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Various governmental entities including, without limitation, the
U.S.&nbsp;Environmental Protection Agency, or EPA, the
U.S.&nbsp;Coast Guard, the U.S.&nbsp;Department of
Transportation, and the Railroad Commission of Texas, have
authority over environmental matters relating to our pipeline,
and their regulations address safety issues relating to the
transportation of liquids, and procedures for responding to and
reporting releases of crude oil.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
State laws regulate the sale of alcohol and tobacco products.
State and local regulatory agencies have the power to approve,
deny, suspend or revoke applications for, and approve or deny
renewals of, permits and licenses relating to the sale of these
products and to seek other remedies. In addition, certain states
regulate relationships, including overlapping ownership, among
alcohol manufacturers, wholesalers and retailers and may deny or
revoke a license if relationships in violation of these
requirements exist. A violation of these requirements by us or a
change in these requirements could have a material adverse
effect on our business, financial condition and results of
operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Food service businesses can be adversely affected by litigation
and complaints from customers or government authorities
resulting from food quality, illness, injury or other health
concerns or operating issues
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">13

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
stemming from one store or a limited number of stores. Adverse
publicity about these allegations may adversely affect us,
regardless of whether the allegations are true, by discouraging
customers from buying food products from us. The filing of
lawsuits or claims against us concerning food served at our
convenience stores could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, new legal requirements, new interpretations of
existing legal requirements, increased legislative activity and
governmental enforcement and other developments could require us
to make additional unforeseen expenditures. Companies in the
petroleum industry, such as us, are currently a particular
target of investigative activity. For example, the Federal Trade
Commission recently launched an investigation of gasoline
pricing among producers and suppliers of petroleum products,
including us, and state officials have commenced price gouging
investigations of retail operators, including us. The assessment
of fines and penalties against us or damaging publicity as a
result of these investigations, or our need to incur costs
associated with complying with any resulting new legal or
regulatory requirements that are substantial and not adequately
provided for, could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The prices of crude oil, other feedstocks and refined
    petroleum products are volatile and depend upon many factors
    that are beyond our control and could adversely affect our
    profitability.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our earnings, cash flow and profitability from our refining
operations depend on the margin above fixed and variable
expenses (including the cost of refinery feedstocks, such as
crude oil) at which we are able to sell refined petroleum
products. Refining margins historically have been and are likely
to continue to be volatile, as a result of numerous factors
beyond our control, including the supply of and demand for crude
oil, other feedstocks, gasoline and other refined petroleum
products. Such supply and demand are affected by, among other
things:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    changes in global and local economic conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    United States and foreign demand for fuel products;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    worldwide political conditions, particularly in significant oil
    producing regions such as the Middle East, Western Coastal
    Africa, the former Soviet Union, and South America;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the level of foreign and domestic production of crude oil and
    refined petroleum products and the level of crude oil, other
    feedstocks and refined petroleum products imported into the
    United States;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    utilization rates of refineries in the United States;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    development and marketing of alternative and competing fuels;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    events that cause disruptions in our distribution channels;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    local factors, including market conditions, adverse weather
    conditions and the level of operations of other refineries and
    pipelines in our markets;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    U.S.&nbsp;government regulations.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant increases and volatility in costs of crude oil,
other feedstocks and refined petroleum products could result in
significant increases in the retail price of refined petroleum
products and in lower retail fuel gross margin per gallon.
Increases in the retail price of refined petroleum products
could impact consumer demand for fuel. In addition, 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 that are beyond our control, such as supply and demand
for fuel and utility services in both local and regional
markets. This volatility makes it extremely difficult to predict
the impact future wholesale cost fluctuations will have on our
business, financial condition and results of operations. These
factors could impact materially our fuel gallon volume, fuel
gross profit and overall customer traffic, which in turn would
adversely impact our merchandise sales.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">14

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The nature of our business requires us to maintain substantial
quantities of crude oil, refined petroleum product and
blendstock inventories. Because crude oil and refined petroleum
products are commodities, we have no control over the changing
market value of these inventories. Because our refinery
inventory is valued at the lower of cost or market value under
the last-in, first-out, or LIFO, inventory valuation
methodology, if the market value of our inventory were to
decline to an amount less than our LIFO cost, we would record a
write-down of inventory and a non-cash charge to cost of sales.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Changes in consumer behavior, travel and tourism could
    adversely impact our business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the retail fuel and convenience store industry, customer
traffic is generally driven by consumer preferences and spending
trends, growth rates for automobile and truck traffic and trends
in travel and tourism. Changes in economic conditions generally
or in the southeastern United States, where substantially all of
our stores are located, could adversely affect discretionary
consumer spending patterns and travel and tourism in our
markets. A decline in the number of visitors to our markets,
changes in consumer preferences or changes in discretionary
consumer spending could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Future tobacco legislation, campaigns to discourage
    smoking, increases in tobacco taxes and wholesale cost increases
    of tobacco products could adversely impact our tobacco product
    sales.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Sales of tobacco products accounted for approximately 10% and
12% of net sales of our retail segment for the nine months ended
September&nbsp;30, 2005 and the year ended December&nbsp;31,
2004, respectively. Significant increases in wholesale cigarette
costs, increased taxes on tobacco products, declines in the
percentage of smokers in the general population, additional
legal restrictions on smoking in public or private
establishments, future legislation and national and local
campaigns to discourage smoking in the United States that have
an adverse effect on the demand for tobacco products could have
a material adverse effect on our business, financial condition
and results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Competitive pressures in our markets can make it difficult to
pass price increases on to our customers. This could materially
and adversely affect our retail price of cigarettes, cigarette
unit volume and net sales, merchandise gross profit and overall
customer traffic. Because we derive a significant percentage of
our net sales from tobacco products, a decline in net sales from
the sale of tobacco products or decrease in margins on our
tobacco product sales could have a material adverse effect on
our business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Terrorist attacks, threats of war or actual war may
    negatively affect our business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Terrorist attacks in the United States and the war with Iraq, as
well as events occurring in response or similar to or in
connection with them, may harm our business. Energy-related
assets (which could include refineries, pipelines and terminals
such as ours) may be at greater risk of future terrorist attacks
than other possible targets in the United States. In addition,
the State of Israel, where our parent company, Delek Group Ltd.,
is based, has suffered armed conflicts and political instability
in recent years. We may be more susceptible to terrorist attack
as a result of our connection to an Israeli owner. Since all of
our directors other than Mr.&nbsp;Yemin reside in Israel, our
business may be harmed if armed conflicts or political
instability in Israel cause one or more of our directors to
become unavailable to serve on our board of directors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A direct attack on our assets or the assets of others used by us
could have a material adverse effect on our business, financial
condition and results of operations. In addition, any terrorist
attack could have an adverse impact on energy prices, including
prices for our crude oil, other feedstocks and refined petroleum
products, and an adverse impact on the margins from our refining
and petroleum product marketing operations. In addition,
disruption or significant increases in energy prices could
result in government-imposed price controls.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">15

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Risks Relating to Our Business</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We depend upon the economic health of the southeastern
    United States.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Substantially all of our stores are located in the southeastern
United States. As a result, our results of operations are
subject to general economic conditions in that region. An
economic downturn in the Southeast could have a material adverse
effect on our business, financial condition and results of
operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may not be able to successfully execute our strategy of
    growth through acquisitions.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A significant part of our growth strategy is to acquire assets
such as our refinery, pipeline and terminals, and our retail
fuel and convenience stores that complement our existing sites
or broaden our geographic presence, and if attractive
opportunities arise, assets in complementary new lines of
business. From our inception in 2001 through December&nbsp;15,
2005, we acquired our refinery, 349 retail fuel and convenience
stores and our wholesale fuel distribution operation, in five
major transactions and several smaller transactions. We expect
to continue to acquire retail fuel and convenience stores as a
major element of our growth strategy.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Acquisitions involve risks that could cause our actual growth or
operating results to differ adversely compared with our
expectations or the expectations of securities analysts. For
example:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We may not be able to identify suitable acquisition candidates
    or acquire additional assets complementary to our refinery,
    pipelines and terminals, additional retail fuel and convenience
    stores, or assets in new lines of business on favorable terms,
    if at all. We compete with others to acquire any of these
    assets. This competition may increase and could result in
    decreased availability or increased prices for suitable
    acquisition candidates. We may experience difficulty in
    anticipating the timing and availability of acquisition
    candidates.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Since the convenience store industry is dominated by small,
    &#147;independent&#148; operators that own fewer than ten
    stores, we will likely need to complete numerous small
    acquisitions, rather than a few major acquisitions, to
    substantially increase our number of retail fuel and convenience
    stores. The need to complete numerous acquisitions will require
    significant amounts of our management&#146;s time.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We may not be able to obtain the necessary financing, on
    favorable terms or at all, to finance any of our potential
    acquisitions.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    During the acquisition process, we may fail or be unable to
    discover some of the liabilities of companies or businesses that
    we acquire. These liabilities may result from a prior
    owner&#146;s noncompliance with applicable federal, state or
    local laws.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We may assume contracts or other obligations in connection with
    particular acquisitions on terms that are less favorable or
    desirable than the terms that we would expect to obtain if we
    negotiated the contracts or other obligations directly.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We may fail to successfully integrate or manage acquired
    refinery, pipeline and terminal assets, our retail fuel and
    convenience stores, or other assets.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Acquired retail fuel and convenience stores or other assets may
    not perform as we expect or we may not be able to obtain the
    cost savings and financial improvements we anticipate.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We may fail to grow our existing systems, financial controls,
    information systems, management resources and human resources in
    a manner that effectively supports our growth.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    To the extent that we acquire assets in complementary new lines
    of business, we may become subject to additional regulatory
    requirements and additional risks that are characteristic or
    typical of these new lines of business.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any failure or inability on our part to complete and integrate
future acquisitions successfully could have a material adverse
effect on our business, financial condition and results of
operations.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">16

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We are relatively new to the refining business and may
    enter new lines of business in which we are
    inexperienced.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In April 2005, we acquired the Tyler refinery, our pipeline and
other refining, product terminal and crude oil pipeline assets
located in Tyler, Texas from companies affiliated with Crown
Central Petroleum, LLC. Prior to this acquisition, we were not
involved in refining operations. As a result of our recent entry
into the refining business, we may not be able to successfully
enter into advantageous business relationships with other
refinery, pipeline or terminal operators, or wholesale marketers
comparable to those which more established refiners may be able
to enter. Therefore, we may be unable to take full advantage of
business opportunities for the refining business and we may
encounter difficulties in meeting our expectations or the
expectations of investors and securities analysts for the
operating results of the refining business.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We continually evaluate strategic opportunities for growth,
which may include opportunities in new lines of business, in
which we currently have no operations and lack experience. Our
ability to succeed in any new line of business will depend upon
our ability to address and overcome limitations in our
experience.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The results of operations reflected in the historical
    financial statements of our refinery included in this prospectus
    may not be representative of the results of operations that will
    be achieved for the refinery as an integrated unit of our
    company.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We acquired the Tyler refinery from companies affiliated with
Crown Central Petroleum, LLC in April 2005. The historical
financial statements of the refinery for 2002, 2003, 2004 and
2005, therefore, reflect accounting and financial assumptions
and allocations made by Crown and the results of operations of
the refinery as a fully integrated business of Crown. The
accounting and financial assumptions and allocations that we
make with respect to subsequent accounting periods may differ
from those made by Crown. In addition, the performance of the
refinery as an integrated part of our operations will differ
from the performance of the refinery as an integrated part of
Crown&#146;s operations. The results of operations of the
refinery reflected in its 2002, 2003, 2004 and 2005 historical
financial statements are, therefore, not necessarily indicative
of the results of operations that may be achieved by us in
subsequent periods, and the results of operations in subsequent
periods may be materially different from the results reflected
in the historical financial statements of the refinery.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may incur significant costs and liabilities with
    respect to investigation and remediation of existing
    environmental conditions at our refinery.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to our purchase of the refinery and pipeline, the previous
owner had been engaged for many years in the investigation and
remediation of liquid hydrocarbons which contaminated soil and
groundwater at the purchased facilities. Upon purchase of the
facilities, we became responsible and liable for certain costs
associated with the continued investigation and remediation of
known and unknown impacted areas at the refinery. In the future,
it may be necessary to conduct further assessments and
remediation efforts at the refinery and pipeline locations. In
addition, we have identified and self-reported certain other
environmental matters subsequent to our purchase of the
refinery. Based upon environmental evaluations performed by
third parties subsequent to our purchase of the Tyler refinery,
we recorded an environmental liability of approximately
$7.9&nbsp;million at the acquisition date for the estimated
costs of environmental remediation for our refinery and crude
oil pipeline. We expect remediation of soil and groundwater at
the refinery to continue for the foreseeable future. The need to
make future expenditures for these purposes that exceed the
amounts we estimate and accrue for could have a material adverse
affect on our business, financial condition and results of
operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may incur significant costs and liabilities in
    connection with new environmental regulations and prior
    non-compliance with air emission regulations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We anticipate that compliance with new regulations, lowering the
permitted level of sulfur in gasoline and highway diesel fuel,
will require us to spend approximately $26.7&nbsp;million in
capital costs between 2006 and the end of 2007. In addition, as
part of a national initiative, the EPA inspected the Tyler
refinery in 2003
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">17

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
and alleged that the prior owner did not comply with certain air
emission regulations. A settlement with the EPA could result in
required capital expenditures and potential penalties. We
currently estimate that these settlement costs and additional
capital expenditures to comply with the requirements of the EPA
will be approximately $13.3&nbsp;million from 2005 to the end of
2007. The need to make future expenditures for these purposes
that exceed the amounts we estimated for them could have a
material adverse effect on our business, financial condition and
results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our refinery concentrates on processing light sweet crude
    oils.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our refinery only processes light sweet crude oils efficiently.
Due to increasing demand for lower sulfur fuels, light sweet
crude oils are more costly and less readily available to us than
heavy sour crude oils. An inability to obtain an adequate supply
of light sweet crude oils to operate our refinery at full
capacity or an increase in the cost of light sweet crude oils
could have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>The dangers inherent in our refining operations could
    cause disruptions and expose us to potentially significant costs
    and liabilities. We are particularly vulnerable to disruptions
    in our refining operations because all of our refining
    operations are conducted at a single facility.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our refining operations are subject to significant hazards and
risks inherent in refining operations and in transporting and
storing crude oil, intermediate and refined petroleum products.
These hazards and risks include, but are not limited to, natural
disasters, fires, explosions, pipeline ruptures and spills,
third party interference and mechanical failure of equipment at
our or third-party facilities, and other events beyond our
control, any of which could result in production and
distribution difficulties and disruptions, environmental
pollution, personal injury or wrongful death claims and other
damage to our properties and the properties of others.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because all of our refining operations are conducted at a single
refinery, any of such events at our refinery could significantly
disrupt our storage, production and distribution of crude and
refined petroleum products and could have a material adverse
effect on our business, financial condition and results of
operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We are subject to interruptions in supply and delivery as
    a result of our reliance on pipelines for transportation of
    crude oil and refined petroleum products.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our refinery receives substantially all of its crude oil through
pipelines. We could experience an interruption of supply and
delivery, or an increased cost of receiving crude oil, if the
ability of these pipelines to transport crude oil is disrupted
because of accidents, governmental regulation, terrorism, other
third-party action or other events beyond our control. The
unavailability for our use for a prolonged period of time of any
of the pipelines that are used to transport crude oil to our
refinery or refined petroleum products from our refinery could
have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our existing inbound pipeline capacity will be
    insufficient to support materially increased production from our
    refinery.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We rely on our pipeline and a leased pipeline to transport crude
oil to our refinery. Due to the capacity limitations, we may be
unable to draw sufficient crude oil from the inbound pipelines
to support increases in our refining output. If we wish to
materially increase our refining output, we will need to upgrade
or supplement the inbound pipelines, which would require us to
make substantial additional capital expenditures.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our refinery is not equipped with an outbound pipeline for
    distribution of our refined petroleum products to our
    customers.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Over 92% of our refinery sales are completed through a rack
system located at our refinery. Unlike other refiners, we do not
own, and have limited access to, an outbound pipeline for
distribution of our
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">18

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
refinery products to our customers. Our lack of an outbound
pipeline may undermine our ability to attract new customers for
our refined petroleum products or increase sales of our refinery
products.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our refinery&#146;s niche position may be vulnerable to
    competitive pressure.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our Tyler refinery is the only supplier of a full range of
refined petroleum products within a radius of approximately
115&nbsp;miles of its location. If a refined petroleum products
delivery pipeline is built in or around the Tyler, Texas area,
we could lose our niche market advantage, which could have a
material adverse effect on our business, financial condition and
results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If the price of crude oil increases significantly, it
    could limit our ability to purchase enough crude oil to operate
    our refinery at full capacity.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We rely in part on our ability to borrow to collateralize or
purchase crude oil for our refinery. If the price of crude oil
increases significantly, we may not have sufficient borrowing
capacity, and may not be able to sufficiently increase borrowing
capacity, under our existing credit facilities to purchase
enough crude oil to operate our refinery at full capacity. Our
failure to operate our refinery at full capacity could have a
material adverse effect on our business, financial condition and
results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our debt levels may limit our flexibility in obtaining
    additional financing and in pursuing other business
    opportunities.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have a significant amount of debt. As of December&nbsp;31,
2005, we had total consolidated debt, including capital lease
obligations, of $268.8&nbsp;million. In addition to our
outstanding debt, as of December&nbsp;31, 2005, our borrowing
availability under our credit facilities was $79.2&nbsp;million.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our significant level of debt could have important consequences
for us. For example, it could:
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increase our vulnerability to general adverse economic and
    industry conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    require us to dedicate a substantial portion of our cash flow
    from operations to service our debt and lease obligations,
    thereby reducing the availability of our cash flow to fund
    working capital, capital expenditures and other general
    corporate purposes;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    limit our flexibility in planning for, or reacting to, changes
    in our business and the industry in which we operate;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    place us at a disadvantage relative to our competitors that have
    less indebtedness or better access to capital by, for example,
    limiting our ability to enter into new markets, renovate our
    stores or pursue acquisitions or other business opportunities;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    limit our ability to borrow additional funds in the
    future;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increase the interest cost of our borrowed funds.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, a substantial portion of our debt has a variable
rate of interest, which increases our vulnerability to interest
rate fluctuations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we are unable to meet our debt (principal and interest) and
lease obligations, we could be forced to restructure or
refinance our obligations, seek additional equity financing or
sell assets, which we may not be able to do on satisfactory
terms or at all. Our default on any of those obligations could
have a material adverse effect on our business, financial
condition and results of operations. In addition, if new debt is
added to our current debt levels, the related risks that we now
face would intensify.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our subsidiaries&#146; debt agreements contain operating
    and financial restrictions that might constrain our business and
    financing activities.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The operating and financial restrictions and covenants in our
subsidiaries&#146; credit facilities and any future financing
agreements could adversely affect our ability to finance future
operations or capital needs or to
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">19

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
engage, expand or pursue our business activities. For example,
to varying degrees our credit facilities restrict our
subsidiaries&#146; ability to:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    declare dividends and redeem or repurchase capital stock;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    prepay, redeem or repurchase debt;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make loans and investments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    incur additional indebtedness or amend our debt and other
    material agreements;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    make capital expenditures;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    engage in mergers, acquisitions and asset sales;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    enter into some intercompany arrangements and make some
    intercompany payments, which in some instances could restrict
    our ability to use the assets, cash flow or earnings of one
    segment to support the other segment.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Other restrictive covenants require that we meet fixed charge
coverage, interest charge coverage and leverage tests as
described in the credit facility agreements. Our ability to
comply with the covenants and restrictions contained in our debt
instruments may be affected by events beyond our control,
including prevailing economic, financial and industry
conditions. If market or other economic conditions deteriorate,
our ability to comply with these covenants and restrictions may
be impaired. If we breach any of the restrictions or covenants
in our debt agreements, a significant portion of our
indebtedness may become immediately due and payable, and our
lenders&#146; commitments to make further loans to us may
terminate. We might not have, or be able to obtain, sufficient
funds to make these immediate payments. In addition, our
obligations under our credit facilities are secured by
substantially all of our assets. If we are unable to repay our
indebtedness under our credit facilities when due, the lenders
could seek to foreclose on the assets. Any of these outcomes
could have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We rely on our parent company and an affiliate for
    guarantees and letters of credit.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Since our inception, from time to time our parent company, Delek
Group Ltd. and/ or our affiliate Delek&nbsp;&#150; The Israel
Fuel Corporation Ltd., have guaranteed our crude oil purchases,
forward contract exposure and some of our indebtedness, and have
issued letters of credit for fuel purchases. See &#147;Certain
Relationships and Related Transactions&nbsp;&#151; Guarantees by
Affiliates.&#148; We cannot assure you that these entities will
continue to furnish guarantees or issue letters of credit for
our benefit. If these entities do not continue to provide some
or all of these guarantees or issue letters of credit, we cannot
assure you that we could replace them on the same or equally
favorable terms, if at all, which could have a material adverse
effect on our business, financial condition and results of
operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may seek to grow by opening new retail fuel and
    convenience stores in new geographic areas.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Since our inception, we have grown primarily by acquiring retail
fuel and convenience stores in the southeastern United States.
We may seek to grow by selectively pursuing acquisitions or by
opening new retail fuel and convenience stores in geographic
areas of the United States in which we currently have little or
no presence. This growth strategy would present numerous
operational and competitive challenges to our senior management
and employees and would place significant pressure on our
operating systems. In addition, we cannot assure you that
consumers located in the regions in which we may expand our
retail fuel and convenience store operations would be as
receptive to our retail fuel and convenience stores as consumers
in our existing markets. The achievement of our expansion plans
will depend in part upon our ability to:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    select, and compete successfully in, new markets;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    obtain suitable sites at acceptable costs;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    realize an acceptable return on the cost of capital invested in
    new facilities;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">20

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    hire, train, and retain qualified personnel;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    integrate new retail fuel and convenience stores into our
    existing distribution, inventory control, and information
    systems;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    expand relationships with our suppliers or develop relationships
    with new suppliers;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    secure adequate financing, to the extent required.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We may incur significant
<FONT style="white-space: nowrap">start-up</FONT> costs in
connection with entering new markets, including costs related to
complying with local regulations. We cannot assure you that we
will achieve our expansion goals, manage our growth effectively,
or operate our existing and new retail fuel and convenience
stores profitability. The failure to achieve any of the
foregoing could have a material adverse effect on our business,
financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Adverse weather conditions or other unforeseen
    developments in the Southeast could negatively affect our
    business.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Southeast is susceptible to severe storms including
hurricanes, thunderstorms, extended periods of rain, ice storms
and snow, all of which we have experienced in the past few
years. Inclement weather conditions, as well as severe storms in
the Southeast, such as Hurricanes Katrina and Rita, could damage
our facilities, have a significant adverse impact on consumer
behavior, travel and retail fuel and convenience store traffic
patterns or impede our ability to operate our locations, or if
such conditions prevail in Texas, could undermine our ability to
produce and transport products from our refinery. Regional
occurrences in the Southeast, such as energy shortages or
increases in energy prices, fires and other natural disasters,
could also hurt our business. The occurrence of any of these
developments could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our operating results are seasonal and generally lower in
    the first and fourth quarters of the year for our refining
    segment and in the first quarter of the year for our retail
    segment. We depend on favorable weather conditions in the spring
    and summer months.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Demand for gasoline and other merchandise is generally higher
during the summer months than during the winter months due to
seasonal increases in highway traffic. As a result, the
operating results of our refining segment are generally lower
for the first and fourth quarters of each year. Seasonal
fluctuations in highway traffic also affect sales of motor fuels
and merchandise in our retail fuel and convenience stores. As a
result, the operating results of our retail segment are
generally lower for the first quarter of the year.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Weather conditions in our operating area also have a significant
effect on our operating results. Customers are more likely to
purchase higher profit margin items at our retail fuel and
convenience stores, such as fast foods, fountain drinks and
other beverages, and more gasoline during the spring and summer
months in the Southeast, thereby typically generating higher
revenues and gross margins for us in these periods. Unfavorable
weather conditions during these months and a resulting lack of
the expected seasonal upswings in highway traffic and sales
could have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We depend on one supplier for a significant portion of our
    retail fuel supply.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We purchased approximately 53% of our fuel for our retail fuel
and convenience stores for the nine months ended
September&nbsp;30, 2005 from a single supplier, Valero Marketing
and Supply. Our contract with Valero expires in 2008 and
provides us with discounts that may not be available to us from
other suppliers. We cannot assure you that we will be able to
renew our contract with Valero on terms that are satisfactory to
us, if at all, or that we would be able to secure equally
favorable terms from another supplier. A change of fuel
supplier, a disruption in supply or a significant change in our
relationship with this fuel supplier could lead to an increase
in our fuel costs and could have a material adverse effect on
our business, financial condition and results of operations.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">21

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We depend on one wholesaler for a significant portion of
    our convenience store merchandise.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We purchased approximately 45% of our merchandise, including
most tobacco products and grocery items for the nine months
ended September&nbsp;30, 2005 from a single wholesale grocer,
McLane Company, Inc., a wholly-owned subsidiary of Berkshire
Hathaway Inc. A change of merchandise suppliers, a disruption in
supply or a significant change in our relationship with our
principal merchandise supplier could lead to an increase in our
cost of goods or a reduction in the reliability of timely
deliveries and could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we believe that our arrangements with vendors,
including McLane, with respect to allowances, payment terms and
operational support commitments, have enabled us to decrease the
operating expenses of convenience stores that we acquire. If we
are unable to maintain favorable arrangements with these
vendors, we may be unable to continue to effect operating
expense reductions at convenience stores we have acquired or
will acquire.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If we fail to develop, integrate or upgrade our
    information technology systems, we may incur costs beyond our
    expectations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Increasingly, we depend upon the flexibility and sophistication
of our technologies supporting our operations. The failure of
hardware or software that supports our information technology
systems or the loss of data contained in the systems could
significantly disrupt our operations. If our information
technology systems are unable to handle additional volume for
our operations as our business and scope of service grow, our
service levels and operating efficiency will decline. Our
failure to upgrade, replace or otherwise modify these systems to
support our business, including to handle increased volumes of
information and protect against disruptions of our operations or
our failure to hire and retain qualified personnel to implement
and maintain our information technology systems could have a
material adverse effect on our business, financial condition and
results of operations. In particular, our sales platform
software is proprietary and therefore requires original
programming by qualified consultants to upgrade and maintain its
functionality.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To compete effectively, we must anticipate and adapt to
technology changes. We may choose new technologies that later
prove to be inadequate, or may be forced to implement new
technologies, at substantial cost, to remain competitive. In
addition, competitors may implement new technologies before we
do, allowing these competitors to provide lower priced, enhanced
or superior quality services compared to the services we
currently provide.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our insurance policies do not cover all losses, costs or
    liabilities that we may experience, and insurance companies that
    currently insure companies in the energy industry may cease to
    do so or substantially increase premiums.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We maintain significant insurance coverage, including property
insurance capped at $450.0&nbsp;million for our refinery and at
approximately $268.0&nbsp;million for our retail fuel and
convenience stores. However, our insurance coverage does not
cover all potential losses, costs or liabilities, and our
business interruption insurance coverage does not apply unless a
business interruption exceeds 45&nbsp;days. We could suffer
losses for uninsurable or uninsured risks or in amounts in
excess of our existing insurance coverage.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The energy industry is highly capital intensive, and the entire
or partial loss of individual facilities can result in
significant costs to both industry participants, such as us, and
their insurance carriers. In recent years, several large energy
industry claims have resulted in significant increases in the
level of premium costs and deductible periods for participants
in the energy industry. For example, during 2005, Hurricanes
Katrina and Rita caused significant damage to several petroleum
refineries along the Gulf Coast, in addition to numerous oil and
gas production facilities and pipelines in that region. As a
result of large energy industry claims, insurance companies that
have historically participated in underwriting energy-related
facilities may discontinue that practice, or demand
significantly higher premiums or deductible periods to cover
these facilities. If significant changes in the number or
financial solvency of insurance underwriters for the energy
industry occur, or if other adverse conditions over which we
have no control prevail in the insurance market, we may be
unable to obtain and maintain adequate insurance at reasonable
cost.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">22

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we cannot assure you that our insurers will renew
our insurance coverage on acceptable terms, if at all, or that
we will be able to arrange for adequate alternative coverage in
the event of non-renewal. The unavailability of full insurance
coverage to cover events in which we suffer significant losses
could have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If we lose any of our key personnel, our ability to manage
    our business and continue our growth could be negatively
    impacted.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our future performance depends to a significant degree upon the
continued contributions of our senior management team and key
technical personnel. We do not currently maintain key man life
insurance with respect to any member of our senior management
team. In addition, no member of our senior management other than
our chief executive officer/president has entered into an
employment agreement with us. To the extent that the services of
members of our senior management team and key technical
personnel would be unavailable to us for any reason, we would be
required to hire other personnel to manage and operate our
company. We cannot assure you that we would be able to locate or
employ such qualified personnel on satisfactory terms, if at
all, which could have a material adverse effect on our business,
financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>A substantial portion of our refinery workforce is
    unionized, and we may face labor disruptions that would
    interfere with our operations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of September&nbsp;30, 2005, we employed 223 people at our
Tyler refinery and pipeline and have collective bargaining
agreements covering 149 of our operations and maintenance hourly
employees and ten of our refinery&#146;s truck drivers, which
agreements expire on January&nbsp;1, 2009 and January&nbsp;31,
2009, respectively. Although these collective bargaining
agreements contain provisions to discourage strikes or work
stoppages, we cannot assure you that strikes or work stoppages
will not occur. A strike or work stoppage could have a material
adverse effect on our business, financial condition and results
of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We are dependent on gasoline sales at our retail fuel and
    convenience stores which makes us susceptible to increases in
    the cost of gasoline and interruptions in fuel supply.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fuel sales represented approximately 72% and 70% of our net
sales of our retail segment for the nine months ended
September&nbsp;30, 2005 and the year ended December&nbsp;31,
2004, respectively. Our dependence on fuel sales makes us
susceptible to increases in the cost of gasoline. As a result,
fuel profit margins have a significant impact on our earnings.
The volume of fuel sold by us and our fuel profit margins are
affected by numerous factors beyond our control, including the
supply and demand for fuel, volatility in the wholesale fuel
market and the pricing policies of competitors in local markets.
Although we can rapidly adjust our pump prices to reflect higher
fuel costs, a material increase in the price of fuel could
adversely affect demand. A material, sudden increase in the cost
of fuel that causes our fuel sales to decline could have a
material adverse effect on our business, financial condition and
results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our dependence on gasoline sales makes us susceptible to
interruptions in fuel supply. We typically have no more than a
five-day supply of fuel at each of our retail fuel and
convenience stores. Our fuel contracts do not guarantee an
uninterrupted, unlimited supply in the event of a shortage. In
addition, gasoline sales generate customer traffic to our retail
fuel and convenience stores. As a result, decreases in gasoline
sales, in the event of a shortage or otherwise, could adversely
affect our merchandise sales. A serious interruption in the
supply of gasoline could have a material adverse effect on our
business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may incur losses as a result of our forward contract
    activities and derivative transactions.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We occasionally use derivative financial instruments, such as
interest rate swaps and interest rate cap agreements, and fuel
related derivative transactions, and we expect to continue to
enter into these types of transactions. We cannot assure you
that the strategies underlying these transactions will be
successful. If any of the instruments we utilize to hedge our
exposure to various types of risk are not effective, we may incur
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">23

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
losses. We incurred a loss of $10.9&nbsp;million in 2005 in
connection with our forward contract activities. See
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If we violate state laws regulating our sale of tobacco
    and alcohol products, or if these laws are changed, our results
    of operations will suffer.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We sell tobacco products in all of our stores and alcohol
products in approximately 85% of our stores. Our net sales from
the sale of tobacco and alcohol products were
$121.4&nbsp;million and $144.6&nbsp;million for the nine months
ended September&nbsp;30, 2005 and the year ended
December&nbsp;31, 2004, respectively. State laws regulate our
sale of tobacco and alcohol products. For example, state and
local regulatory agencies have the power to approve, revoke,
suspend or deny applications for, and renewals of, permits and
licenses relating to the sale of these products or to seek other
remedies. Certain states regulate relationships, including
overlapping ownership, among alcohol manufacturers, wholesalers
and retailers and may deny or revoke licensure if relationships
in violation of the state laws exist. In addition, certain
states have adopted or are considering adopting &#147;warm beer
laws&#148; that seek to discourage drunk driving by prohibiting
the sale of refrigerated beer. Our violation of state laws
regulating our sale of tobacco and alcohol products or a change
in these laws, such as the adoption of a &#147;warm beer
laws&#148; in one or more of the states we operate, could have a
material adverse effect on our business, financial condition and
results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If we fail to meet our obligations under our long-term
    branded gasoline supply agreement with BP, we may incur
    penalties and/or the agreement may be terminated.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2005, we entered into a branded gasoline jobber
supply agreement with BP, to purchase a portion of our gasoline
products for a minimum of 15&nbsp;years. The agreement requires
us to purchase specified minimum quantities of branded gasoline
products annually, which quantities escalate on a yearly basis.
We estimate that for the year ending December&nbsp;31, 2006, BP
will supply approximately 12.5% of our total gasoline volume. If
we fail to purchase the applicable annual minimum quantities, BP
may terminate the agreement and we could be required to pay BP
damages equal to the difference between the specified
contractual minimum annual gallons of gasoline products and the
amount actually purchased by us, multiplied by a specified per
gallon amount. The termination of the agreement by BP and the
imposition of damages could have a material adverse effect on
our business, financial condition and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If we are unable to continue using the BP, Exxon, Shell,
    or Chevron brand names or if there is negative publicity
    concerning any of these major oil companies, sales at certain of
    our stores may suffer.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We operate approximately 23% of our retail fuel and convenience
stores under the BP, Exxon, Shell and Chevron brand names. If
these stores lose the right to use these brand names (and
accompanying brand advertising), or if there is negative
publicity concerning any of these major oil companies, we could
suffer a decline in sales at these stores.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>It may be difficult to serve process on or enforce a
    United States judgment against almost all of our
    directors.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All of our directors named in this prospectus, other than
Mr.&nbsp;Yemin, reside in the State of Israel. In addition, a
substantial portion of the assets of these directors are located
outside of the United States. As a result, you may have
difficulty serving legal process within the United States upon
any of these persons. You may also have difficulty enforcing,
both in and outside the United States, judgments you may obtain
in United States courts against these persons in any action,
including actions based upon the civil liability provisions of
United States federal or state securities laws. Furthermore,
there is substantial doubt that the courts of the State of
Israel would enter judgments in original actions brought in
those courts predicated on U.S.&nbsp;federal or state securities
laws.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">24

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>If we are, or become, a U.S.&nbsp;real property holding
    corporation, special tax rules may apply to a sale, exchange or
    other disposition of common stock and
    <FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>holders
    may be less inclined to invest in our stock as they may be
    subject to U.S.&nbsp;federal income tax in certain
    situations.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A <FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>holder
will be subject to U.S.&nbsp;federal income tax with respect to
gain recognized on the sale, exchange or other disposition of
common stock if we are, or were, a &#147;U.S.&nbsp;real property
holding corporation,&#148; or a USRPHC, at any time during the
shorter of the five-year period ending on the date of the sale
or other disposition and the period such
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>holder
held our common stock (the shorter period referred to as the
&#147;lookback period&#148;). In general, we would be a USRPHC
if interests in U.S.&nbsp;real estate comprised most of our
assets. Because of the real property and retail fuel and
convenience stores we own, we may be, or may become, a USRPHC.
If we are or become a USRPHC, so long as our common stock is
regularly traded on an established securities market (such as
the NYSE), only a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>holder
who, actually or constructively, holds or held during the
lookback period more than 5% of our common stock will be subject
to U.S.&nbsp;federal income tax on the disposition of our common
stock.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Risks Related to Our Common Stock and this Offering</B>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>There is no existing market for our common stock, and a
    trading market that will provide you with adequate liquidity may
    not develop. The price of our common stock may fluctuate
    significantly, and you could lose all or part of your
    investment.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to this offering, there has been no public market for our
common stock. We cannot predict the extent to which investor
interest will lead to the development of an active and liquid
trading market in our common stock on the NYSE or otherwise. If
an active trading market does not develop, you may have
difficulty selling any of our common stock that you buy.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The initial public offering price for the shares will be
determined by negotiations between us and the representatives of
the underwriters and may not be indicative of the market price
of the common stock that will prevail in the trading market. The
market price of our common stock may decline below the initial
public offering price. The market price of our common stock may
also be influenced by many factors, some of which are beyond our
control, including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our quarterly or annual earnings or those of other companies in
    our industry;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    announcements by us or our competitors of significant contracts
    or acquisitions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    changes in accounting standards, policies, guidance,
    interpretations or principles;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    general economic and stock market conditions;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the failure of securities analysts to cover our common stock
    after this offering or changes in financial estimates by
    analysts;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    future sales of our common stock;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the other factors described in these &#147;Risk Factors.&#148;</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In recent years, the stock market has experienced extreme price
and volume fluctuations. This volatility has had a significant
impact on the market price of securities issued by many
companies, including companies in our industry. The changes
frequently appear to occur without regard to the operating
performance of these companies. The price of our common stock
could fluctuate based upon factors that have little or nothing
to do with our company, and these fluctuations could materially
reduce our stock price.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the past, some companies that have had volatile market prices
for their securities have been subject to securities class
action suits filed against them. The filing of a lawsuit against
us, regardless of the outcome, could have a material adverse
effect on our business, financial condition and results of
operations, as it could result in substantial legal costs and a
diversion of our management&#146;s attention and resources.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">25

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>You will suffer immediate and substantial dilution.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The initial public offering price of our common stock is
substantially higher than the net tangible book value per share
of our outstanding common stock. As a result, you will pay a
price per share that substantially exceeds the tangible book
value of our assets after subtracting liabilities. You will
incur immediate and substantial dilution of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share. You will suffer additional dilution if stock, restricted
stock units, restricted stock, stock options, warrants or other
equity awards, whether currently outstanding or subsequently
granted, are exercised, including the stock options and
restricted stock units described under
&#147;Management&nbsp;&#151; IPO Awards. See
&#147;Dilution.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We are a &#147;controlled company&#148; within the meaning
    of the NYSE rules and, as a result, will qualify for, and intend
    to rely on, exemptions from certain corporate governance
    requirements.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A company of which more than 50% of the voting power is held by
an individual, a group or another company is a &#147;controlled
company&#148; and may elect not to comply with certain corporate
governance requirements of the NYSE, including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the requirement that a majority of our board of directors
    consist of independent directors;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the requirement that we have a nominating/corporate governance
    committee consisting entirely of independent directors with a
    written charter addressing the committee&#146;s purpose and
    responsibilities;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the requirement that we have a compensation committee consisting
    entirely of independent directors with a written charter
    addressing the committee&#146;s purpose and responsibilities.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Following this offering, we intend to utilize some or all of
these exemptions. Accordingly, you will not have the same
protections afforded to stockholders of companies that are
subject to all of the corporate governance requirements of the
NYSE.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Our controlling stockholder, Delek Group Ltd., may have
    conflicts of interest with other stockholders in the
    future.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Delek Group Ltd. currently owns indirectly all of our
outstanding common stock. After this offering, Delek Group Ltd.
will own indirectly
approximately &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;%
of our outstanding common stock, or
approximately &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% if the
underwriters exercise their purchase option in full. As a
result, Delek Group Ltd. and its controlling shareholder,
Mr.&nbsp;Yitzchak Sharon Teshuva, an Israeli citizen, will
continue to be able to control the election of our directors,
determine our corporate and management policies and determine,
without the consent of our other stockholders, the outcome of
any corporate transaction or other matter submitted to our
stockholders for approval, including potential mergers or
acquisitions, asset sales and other significant corporate
transactions. So long as Delek Group Ltd. continues to own a
significant amount of the outstanding shares of our common
stock, Delek Group Ltd. will continue to be able to strongly
influence or effectively control our decisions, including
whether to pursue or consummate potential mergers or
acquisitions, asset sales and other significant corporate
transactions. We cannot assure you that the interests of Delek
Group Ltd. will coincide with the interests of other holders of
our common stock.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Future sales of our common stock by our controlling
    stockholder, Delek Group Ltd., could depress the price of our
    common stock.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The market price of our common stock could decline as a result
of sales of a large number of shares of our common stock in the
market after this offering or the perception that these sales
could occur. These sales, or the possibility that these sales
may occur, also might make it more difficult for us to sell
equity securities in the future at a time and at a price that we
deem appropriate. Upon completion of this offering, we will
have &nbsp;shares of common stock outstanding. Delek Group Ltd.,
our controlling stockholder, is subject to an agreement with the
underwriters that restricts its ability to transfer shares of
our common stock for 180&nbsp;days after the date of this
prospectus. The representatives of the underwriters may, in
their sole discretion and at any time, waive the restrictions on
transfer in this agreement during this period. After this
agreement
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">26

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
expires,
approximately &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;of
these shares will be eligible for sale in the public market,
subject to applicable federal securities law restrictions.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We depend upon our subsidiaries for cash to meet our
    obligations and pay any dividends.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a holding company. Our subsidiaries conduct substantially
all of our operations and own substantially all of our assets.
Consequently, our cash flow and our ability to meet our
obligations or pay dividends to our stockholders depend upon the
cash flow of our subsidiaries and the payment of funds by our
subsidiaries to us in the form of dividends, tax sharing
payments or otherwise. Our subsidiaries&#146; ability to make
any payments will depend on many factors, including their
earnings, the terms of their indebtedness, tax considerations
and legal restrictions.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We may be unable to pay dividends in the anticipated
    amounts and frequency set forth in this prospectus.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have never declared or paid any cash dividends on our capital
stock. We will only be able to pay dividends from our available
cash on hand and funds received from our subsidiaries. Our
ability to receive dividends from our subsidiaries is restricted
under the terms of their senior secured credit facilities. The
declaration of future dividends on our common stock will be at
the discretion of our board of directors and will depend upon
many factors, including our results of operations, financial
condition, earnings, capital requirements, restrictions in our
debt agreements and legal requirements. Although we currently
intend to pay quarterly cash dividends on our common stock at an
initial annual rate of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share
commencing &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
we cannot assure you that any dividends will be paid in the
anticipated amounts and frequency set forth in this prospectus,
if at all. Accordingly, if you purchase shares of common stock
in this offering, you may be unable to realize a gain on your
investment unless the price of our common stock appreciates.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We have not determined any specific use for a significant
    portion of the proceeds from this offering and we may use the
    proceeds in ways with which you may not agree.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our management will have considerable discretion in the
application of the net proceeds received by us. You will not
have the opportunity, as part of your investment decision, to
assess whether the proceeds are being used appropriately. You
must rely on the judgment of our management regarding the
application of the net proceeds of this offering. The net
proceeds may be used for corporate purposes that may not improve
our financial condition and results of operations or increase
our stock price. See &#147;Use of Proceeds.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Provisions of Delaware law and our organizational
    documents may discourage takeovers and business combinations
    that our stockholders may consider in their best interests,
    which could negatively affect our stock price.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the fact that Delek Group Ltd. will own the
majority of our common stock after this offering, provisions of
Delaware law and our amended and restated certificate of
incorporation and amended and restated bylaws to be in effect
upon completion of this offering may have the effect of delaying
or preventing a change in control of our company or deterring
tender offers for our common stock that other stockholders may
consider in their best interests.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our certificate of incorporation authorizes us to issue up
to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of preferred stock in one or more different series with terms to
be fixed by our board of directors. Stockholder approval is not
necessary to issue preferred stock in this manner. Issuance of
these shares of preferred stock could have the effect of making
it more difficult and more expensive for a person or group to
acquire control of us, and could effectively be used as an
anti-takeover device. Following the closing of this offering, no
shares of our preferred stock will be outstanding.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our bylaws provide for an advance notice procedure for
stockholders to nominate director candidates for election or to
bring business before an annual meeting of stockholders,
including proposed nominations of persons for election to our
board of directors, and require that special meetings of
stockholders be called only
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">27

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
by our chairman of the board, president or secretary after
written request of a majority of our board of directors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The anti-takeover provisions of Delaware law and provisions in
our organizational documents may prevent our stockholders from
receiving the benefit from any premium to the market price of
our common stock offered by a bidder in a takeover context. Even
in the absence of a takeover attempt, the existence of these
provisions may adversely affect the prevailing market price of
our common stock if they are viewed as discouraging takeover
attempts in the future.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Being a public company will increase our administrative
    workload and expenses.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a public company with common stock listed on the NYSE, we
will need to comply with new laws, regulations and requirements,
including certain provisions of the Sarbanes-Oxley Act of 2002,
related regulations of the Securities and Exchange Commission,
or SEC, and the requirements of the NYSE, with which we are not
required to comply with as a private company. Complying with
these statutes, regulations and requirements will occupy a
significant amount of the time of our board of directors and
management. The hiring of additional personnel to handle these
responsibilities will increase our operating costs. We will need
to:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    institute a more comprehensive compliance function;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    design, establish, evaluate and maintain a system of internal
    controls over financial reporting in compliance with the
    requirements of Section&nbsp;404 of the Sarbanes-Oxley Act of
    2002 and the related rules and regulations of the SEC and the
    Public Company Accounting Oversight Board;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    prepare and distribute periodic public reports in compliance
    with our obligations under the federal securities laws;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    involve and retain to a greater degree outside counsel and
    accountants in the above activities;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    enhance our investor relations function.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we expect that being a public company subject to
these rules and regulations will make it more expensive for us
to obtain director and officer liability insurance, and we may
be required to accept reduced coverage or incur substantially
higher costs to obtain coverage. These factors could also make
it more difficult for us to attract and retain qualified members
of our board of directors, particularly to serve on our audit
and compensation committees, and qualified executive officers.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>We will be exposed to risks relating to evaluations of
    internal controls required by Section&nbsp;404 of the
    Sarbanes-Oxley Act of 2002.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are in the process of evaluating our internal controls
systems to allow management to report on, and our independent
auditors to audit, our internal controls over financial
reporting. We will be performing the system and process
evaluation and testing (and any necessary remediation) required
to comply with the management certification and auditor
attestation requirements of Section&nbsp;404 of the
Sarbanes-Oxley Act of 2002. We will be required to comply with
Section&nbsp;404 by no later than December&nbsp;31, 2007.
However, we cannot be certain as to the timing of completion of
our evaluation, testing and remediation actions or the impact of
the same on our operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Furthermore, upon completion of this process, we may identify
control deficiencies of varying degrees of severity under
applicable SEC and Public Company Accounting Oversight Board
rules and regulations that remain unremediated. As a public
company, we will be required to report, among other things,
control deficiencies that constitute a &#147;material
weakness&#148; or changes in internal controls that, or are
reasonably likely to, materially affect internal controls over
financial reporting. A &#147;material weakness&#148; is a
significant deficiency, or combination of significant
deficiencies that results in more than a remote likelihood that
a material misstatement of the annual or interim financial
statements will not be prevented or detected. We are aware that
we will need, and we intend, to hire additional accounting
personnel in order to comply with the rules and regulations that
will apply to us as a public company.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">28

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we fail to implement the requirements of Section&nbsp;404 in
a timely manner, we might be subject to sanctions or
investigation by regulatory authorities such as the SEC or the
NYSE. Additionally, failure to comply with Section&nbsp;404 or
the report by us of a material weakness may cause investors to
lose confidence in our financial statements and our stock price
may be adversely affected. If we fail to remedy any material
weakness, our financial statements may be inaccurate, we may
face restricted access to the capital markets, and our stock
price may decline.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">29

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='103'></A>
</DIV>

<!-- link1 "CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CAUTIONARY STATEMENT</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>REGARDING FORWARD-LOOKING STATEMENTS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This prospectus contains &#147;forward-looking statements&#148;
that reflect our current estimates, expectations and projections
about our future results, performance, prospects and
opportunities. Forward-looking statements include, among other
things, the information concerning our possible future results
of operations, business and growth strategies, financing plans,
expectations that regulatory developments or other matters will
not have a material adverse effect on our business or financial
condition, our competitive position and the effects of
competition, the projected growth of the industry in which we
operate, and the benefits and synergies to be obtained from our
completed and any future acquisitions, and statements of
management&#146;s goals and objectives, and other similar
expressions concerning matters that are not historical facts.
Words such as &#147;may,&#148; &#147;will,&#148;
&#147;should,&#148; &#147;could,&#148; &#147;would,&#148;
&#147;predicts,&#148; &#147;potential,&#148;
&#147;continue,&#148; &#147;expects,&#148;
&#147;anticipates,&#148; &#147;future,&#148;
&#147;intends,&#148; &#147;plans,&#148; &#147;believes,&#148;
&#147;estimates,&#148; &#147;appears,&#148; &#147;projects&#148;
and similar expressions, as well as statements in future tense,
identify forward-looking statements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Forward-looking statements should not be read as a guarantee of
future performance or results, and will not necessarily be
accurate indications of the times at, or by which, such
performance or results will be achieved. Forward-looking
information is based on information available at the time and/or
management&#146;s good faith belief with respect to future
events, and is subject to risks and uncertainties that could
cause actual performance or results to differ materially from
those expressed in the statements. Important factors that could
cause such differences include, but are not limited to:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    competition;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    changes in, or the failure to comply with, the extensive
    government regulations applicable to our industry segments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the availability, cost and price volatility of crude oil, other
    refinery feedstocks and refined petroleum products;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our ability to integrate acquired businesses and implement our
    growth strategy;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    general economic and business conditions, particularly levels of
    spending relating to travel and tourism or conditions affecting
    the southeastern United States;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    dependence on one principal fuel supplier and one wholesaler for
    a significant portion of our convenience store merchandise;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    operating hazards, natural disasters, casualty losses and other
    matters beyond our control;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    increases in our debt levels;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    restrictive covenants in our debt agreements;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    seasonality;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    terrorist attacks;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    potential conflicts of interest between our major stockholder
    and other stockholders;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our discretion in the use of net proceeds from this offering; and</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    other factors discussed under the headings &#147;Risk
    Factors,&#148; &#147;Management&#146;s Discussion and Analysis
    of Financial Condition and Results of Operations&#148; and
    &#147;Business.&#148;</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In light of these risks, uncertainties and assumptions, our
actual results of operations and execution of our business
strategy could differ materially from those expressed in, or
implied by, the forward-looking statements, and you should not
place undue reliance upon them. In addition, past financial
and/or operating performance is not necessarily a reliable
indicator of future performance and you should not use our
historical performance to anticipate results or future period
trends. We can give no assurances that any of the events
anticipated by the forward-looking statements will occur or, if
any of them do, what impact they will have on our results of
operations and financial condition.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">30

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Forward-looking statements speak only as of the date the
statements are made. We assume no obligation to update
forward-looking statements to reflect actual results, changes in
assumptions or changes in other factors affecting
forward-looking information except to the extent required by
applicable securities laws. If we do update one or more
forward-looking statements, no inference should be drawn that we
will make additional updates with respect thereto or with
respect to other forward-looking statements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All forward-looking statements attributable to us or persons
acting on our behalf are expressly qualified in their entirety
by the cautionary statements included in this prospectus.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">31

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='104'></A>
</DIV>

<!-- link1 "USE OF PROCEEDS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>USE OF PROCEEDS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We estimate that the net proceeds to us from this offering will
be approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
or approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;if
the underwriters&#146; option to purchase additional shares is
exercised in full, based on an assumed initial public offering
price of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
the midpoint of the range set forth on the cover page of this
prospectus, and after deducting estimated underwriting discounts
and commissions and estimated offering expenses that are payable
by us in connection with the offering. We expect to use these
net proceeds:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to fully repay the $25.0&nbsp;million outstanding principal,
    plus accrued interest to the date of repayment (which accrued
    interest was approximately $1.5&nbsp;million on
    December&nbsp;31, 2005), under the promissory note payable to
    Delek&nbsp;&#150; The Israel Fuel Corporation Ltd., one of our
    affiliates, which bears interest at a rate of 6.3%&nbsp;per year
    and has a maturity date of April&nbsp;27, 2008;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to fully repay the $17.5&nbsp;million outstanding principal,
    plus accrued interest to the date of repayment (which accrued
    interest was approximately $0.8&nbsp;million on
    December&nbsp;31, 2005), under the promissory note payable to
    Delek Group Ltd., our parent company, which bears interest at a
    rate of 7.0%&nbsp;per year and has a maturity date of
    April&nbsp;27, 2010;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    to fully repay the $10.0&nbsp;million outstanding principal,
    plus accrued interest to the date of repayment (which accrued
    interest was approximately $0.6&nbsp;million on
    December&nbsp;31, 2005), under the promissory note payable to
    Bank Leumi USA, which bears interest at a spread of
    1.375%&nbsp;per year over the LIBOR Rate (Reserve Adjusted) for
    a three month term (5.625% at December&nbsp;31, 2005), and has a
    maturity date of April&nbsp;27, 2007;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    for general corporate purposes, including working capital,
    capital expenditures and possible acquisitions.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, we signed the promissory note payable to
Delek Group Ltd. described above in an original principal amount
of $35.0&nbsp;million. The proceeds of this promissory note were
used to partially fund the purchase of our Tyler refinery. On
November&nbsp;23, 2005, we repaid $17.5&nbsp;million of the
principal and all accrued interest on this note through the date
of repayment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, we signed the promissory note payable to
Bank Leumi USA described above in an original principal amount
of $20.0&nbsp;million. The proceeds of this promissory note were
used to partially fund the purchase of our Tyler refinery. On
November&nbsp;23, 2005, we repaid $10.0&nbsp;million of the
principal under this note.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Although we continually evaluate acquisition opportunities, we
have not entered into any binding commitments or agreements with
respect to future acquisitions. Pending use of the net proceeds,
we will invest the net proceeds of this offering in
interest-bearing, short-term, investment grade, highly liquid
securities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='105'></A>
</DIV>

<!-- link1 "DIVIDEND POLICY" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DIVIDEND POLICY</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have never declared or paid any cash dividends on our capital
stock. We currently intend to pay quarterly cash dividends on
our common stock at an initial annual rate of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share
commencing &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.
We will only be able to pay dividends from our available cash on
hand and funds received from our subsidiaries. Our
subsidiaries&#146; ability to make any payments to us will
depend upon many factors, including their earnings, the terms of
their indebtedness, tax considerations and legal restrictions.
Our ability to receive dividends from our subsidiaries is
restricted under the terms of their senior secured credit
facilities. The declaration of future dividends on our common
stock will be at the discretion of our board of directors and
will depend upon many factors, including our results of
operations, financial condition, earnings, capital requirements,
restrictions in our debt agreements and legal requirements. We
cannot assure you that any dividends will be paid in the
anticipated amounts and frequency set forth in this prospectus,
if at all.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">32

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='106'></A>
</DIV>

<!-- link1 "CAPITALIZATION" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CAPITALIZATION</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth our consolidated cash and cash
equivalents and capitalization as of September&nbsp;30, 2005:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    on an actual basis;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    as adjusted to give effect to the transactions described in
    footnote (1)&nbsp;below as if such transactions had occurred on
    September&nbsp;30, 2005;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    as further adjusted to reflect our sale
    of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares of our common
    stock at a price of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share, the midpoint of the range set forth on the cover page of
    this prospectus, and our use of proceeds, net of estimated
    underwriting discounts and commissions and estimated offering
    expenses that are payable by us.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This table should be read in conjunction with our audited
consolidated financial statements, including the notes thereto,
&#147;Use of Proceeds,&#148; &#147;Selected Historical
Consolidated Financial Information,&#148;
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations&#148; and our unaudited
condensed consolidated financial statements included elsewhere
in this prospectus.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="54%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>As of September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As Further</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Actual</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As Adjusted(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Adjusted</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>147,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>104,527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$42,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Senior secured credit facility&nbsp;&#151; term loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>164,588</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>164,588</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>164,588</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Senior secured credit facility&nbsp;&#151; revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>38,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>38,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Israel Discount Bank note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Bank Leumi USA note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>275,178</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>222,678</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Stockholder&#146;s equity:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Common stock, $0.01&nbsp;par value, 3,000&nbsp;shares
    authorized, 100&nbsp;shares issued and outstanding,
    actual; &nbsp;&nbsp;&nbsp;shares
    authorized, &nbsp;&nbsp;&nbsp;shares issued and outstanding, as
    adjusted(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Additional paid-in capital</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retained earnings</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54,153</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54,153</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total capitalization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>377,952</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>370,452</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Reflects the following prepayments of debt after
    September&nbsp;30, 2005 as if they had occurred on
    September&nbsp;30, 2005: the prepayment on November&nbsp;23,
    2005 of $17.5&nbsp;million of principal on the
    $35.0&nbsp;million promissory note, dated April&nbsp;27, 2005
    payable to Delek Group Ltd.; the prepayment, on
    November&nbsp;23, 2005, of $10.0&nbsp;million of principal on
    the $30.0&nbsp;million promissory note, dated April&nbsp;26,
    2005 payable to Israel Discount Bank; and the prepayment, on
    November&nbsp;23, 2005, of $10.0&nbsp;million of principal on
    the $20.0&nbsp;million promissory note, dated April&nbsp;27,
    2005 payable to Bank Leumi USA. Also gives effect to our
    acquisition of retail fuel and convenience stores and other
    assets from BP in December 2005 for $35.0&nbsp;million, of which
    $5.0&nbsp;million was financed with cash on hand and
    $30.0&nbsp;million was financed from borrowings under our
    revolving credit facility.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">33

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    The number of shares of common stock to be authorized, issued
    and outstanding after the offering:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    gives effect to
    a &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-for-one
    stock split of our common stock, which will be effective
    immediately prior to this offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT>
    registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> we intend
    to file within 30&nbsp;days after the completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    assumes no exercise by the underwriters of their option to
    purchase up
    to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;additional
    shares of common stock from us if they sell more
    than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    in the offering.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">34

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='107'></A>
</DIV>

<!-- link1 "DILUTION" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DILUTION</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If you invest in our common stock, your interest will be diluted
to the extent of the difference between the public offering
price per share of our common stock and the pro forma net
tangible book value per share of our common stock after giving
effect to this offering. Net tangible book value dilution per
share represents the difference between the amount per share
paid by purchasers of common stock in this offering and the pro
forma net tangible book value per share of common stock
immediately after completion of this offering.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our net tangible book value as of September&nbsp;30, 2005 was
approximately $17.8&nbsp;million, or approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share of common stock.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have calculated this amount by:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    subtracting our total liabilities from our total tangible
    assets;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    then dividing the difference by the number of shares of common
    stock outstanding.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If we give effect to our sale
of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock in this offering at an assumed initial public
offering price of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share, the midpoint of the range set forth on the cover page of
this prospectus, after deducting estimated underwriting
discounts and commissions and estimated offering expenses that
are payable by us, our adjusted net tangible book value as of
September&nbsp;30, 2005 would have been approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
or approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share. This amount represents an immediate dilution of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share to new investors. The following table illustrates this per
share dilution:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="72%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assumed initial public offering price per share of common
    stock(1)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net tangible book value per share as of September&nbsp;30, 2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in net tangible book value per share attributable to
    new investors in this offering</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Pro forma net tangible book value per share after this offering</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Dilution per share to new investors</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table summarizes on the basis described above, as
of September&nbsp;30, 2005, the difference between the number of
shares of common stock purchased from us, the total cash
consideration paid to us, and the average price per share paid
by our existing stockholder since our inception and by new
investors in this offering, at an assumed initial public
offering price of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share, the midpoint of the range set forth on the cover page of
this prospectus, before deducting estimated underwriting
discounts and commissions and estimated offering expenses that
are payable by us:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="45%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Total</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Average Price</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Purchased</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Consideration</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Per Share</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Amount</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Existing stockholder(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    New investors</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Before deducting estimated underwriting discounts and
    commissions and estimated offering expenses that are payable by
    us.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    If the underwriters exercise their option to purchase additional
    shares in full, the number of shares of common stock held by our
    existing stockholder will decrease
    to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
    or &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% of the total number of shares
    of common stock to be outstanding immediately after this
    offering and the number of shares held by new investors will
    increase
    to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
    or &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% of the total number of shares
    of common stock to be outstanding immediately after this
    offering.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">35

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The tables above assume no exercise of share purchase rights
outstanding on September&nbsp;30, 2005. As of September&nbsp;30,
2005, there were outstanding share purchase rights to
purchase &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock, at a weighted average exercise price of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share, subject to certain vesting requirements. No share
purchase rights were exercisable at September&nbsp;30, 2005, as
their exercise is contingent upon our becoming a publicly traded
company. To the extent these share purchase rights are exercised
after consummation of this offering, there will be further
dilution to new investors. If all of these outstanding share
purchase rights had been exercised as of September&nbsp;30,
2005, net tangible book value per share after this offering
would have been
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;and
total dilution per share to new investors would have been
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.
In addition, we plan to grant options and restricted stock units
in connection with this offering, as further described under
&#147;Management&nbsp;&#151; IPO Awards,&#148; and may issue
other equity securities in the future that may be dilutive to
investors in this offering.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">36

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='108'></A>
</DIV>

<!-- link1 "SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth selected historical consolidated
financial and other data. The following selected historical
consolidated financial information for the period from inception
(April&nbsp;10, 2001) to December&nbsp;31, 2001 and for the
years ended December&nbsp;31, 2002, 2003 and 2004 is derived
from our audited consolidated financial statements. The audited
consolidated financial statements for the years ended
December&nbsp;31, 2002, 2003 and 2004 appear elsewhere in this
prospectus.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The selected historical financial information for the nine-month
periods ended September&nbsp;30, 2004 and 2005 are derived from
our unaudited condensed consolidated financial statements
appearing elsewhere in this prospectus. In the opinion of
management, the unaudited financial statements include all
adjustments, consisting of only normal recurring adjustments,
necessary for a fair presentation of the financial position and
the results of operations for these periods. Operating results
for the nine-month periods ended September&nbsp;30, 2005, are
not necessarily indicative of the results that may be expected
for the entire year ending December&nbsp;31, 2005. Additionally,
our financial condition and results of operations for certain
periods may not be comparable due to the acquisition of
Williamson Oil effective April&nbsp;30, 2004, the acquisition of
the Tyler refinery and related assets effective April&nbsp;29,
2005, various refinancings of indebtedness and other
transactions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The operating information under Key Operating Statistics was
derived from our internal reporting systems.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The information contained in this table should also be read in
conjunction with &#147;Capitalization,&#148; &#147;Unaudited Pro
Forma Condensed Consolidated Financial Data,&#148;
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations,&#148; and the consolidated
financial statements and accompanying notes thereto included
elsewhere in this prospectus.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 9pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="36%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period from</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Inception</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>(April&nbsp;10,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001) to</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Statement of Operations Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>311,180</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>857,834</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>617,955</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>798,974</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refining</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>588,326</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>241</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>311,180</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>857,899</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>617,971</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>257,271</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>460,337</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>500,181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>730,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>526,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35,958</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,704</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80,060</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58,289</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,945</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,227</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,122</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,665</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,553</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,674</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract hedging activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 9pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>304,727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>542,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>584,113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>837,438</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>603,695</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,309,575</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,453</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,592</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,044</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,276</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,365</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,059</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense&nbsp;&#151; related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,210</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>778</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,287</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on derivative instruments(5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees(6)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 9pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,365</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,330</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,996</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,654</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,817</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">37

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="36%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period from</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Inception</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>(April&nbsp;10,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001) to</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before income taxes and cumulative effect of
    change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,088</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(738</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,622</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,149</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>794</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,787</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,520</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings (loss) per share(7):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average shares, basic and diluted(7)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash Flow Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$16,614</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$17,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$26,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$24,926</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$16,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$139,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(208,574</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,066</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(16,149</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(27,343</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(26,763</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(83,588</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>201,928</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,465</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,616</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,962</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,279</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (decrease) increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$9,968</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,942</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$3,199</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$3,417</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$124,921</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Segment Data (8)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="44%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>Nine Months Ended September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Corporate,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Other and</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Refining(2)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retail</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Eliminations(9)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Consolidated</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales (excluding intercompany sales)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$588,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$798,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$241</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Intercompany sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>489,401</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>690,982</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,636</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,402</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>248</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Segment contribution margin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$72,177</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$43,590</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(7</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,760</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">38

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="32%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period from</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Inception</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>(April&nbsp;10,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001) to</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap><B>(Dollars in thousands, except pricing information)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Other Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjusted EBITDA(10)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$11,006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$15,018</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$24,398</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$31,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,723</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$98,456</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital expenditures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,648</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,832</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,415</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="26">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Key Operating Statistics:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    REFINING SEGMENT</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Days operated in period(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>155</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total sales volume (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,646</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Products manufactured (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gasoline</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,366</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Diesel/ Jet</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,288</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petrochemicals, LPG, NGLs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,517</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,061</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total production</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,232</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Throughput (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,887</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other feedstocks</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>878</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total throughput</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Per barrel of sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refining operating margin(11)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$12.23</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Direct operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$3.39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="26">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    RETAIL SEGMENT</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Number of stores (end of period)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>243</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>328</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average number of stores</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>242</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>310</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>329</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel sales (thousands of gallons)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>155,552</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,396</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,476</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>315,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>231,315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>249,507</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average retail gallons per average number of stores (in
    thousands)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>665</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,133</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>766</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>758</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel margin (per gallon)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.147</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.130</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.155</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.164</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$118,388</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$204,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$206,950</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$261,232</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$191,728</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$219,840</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise margin %</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26.7</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">39

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="37%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>As of December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As of September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>(Dollars in thousands)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance Sheet Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$9,968</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$10,965</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$18,907</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,106</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$147,027</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40,016</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>46,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,094</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>336,534</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and equipment, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>126,617</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>130,892</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>136,538</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>189,293</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>219,418</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>226,152</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>256,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>330,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>641,558</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>181,935</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,324</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>72,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>227,971</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total debt, including current maturities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>161,107</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>161,713</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>168,752</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>203,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total noncurrent liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,802</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>152,821</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>159,793</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>202,134</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>318,313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>42,415</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,941</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,421</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>226,152</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>256,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>330,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>641,558</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;30, 2004, we completed the acquisition of
    100% of the outstanding stock of Williamson Oil. Because the
    results of operations of Williamson Oil are included in our
    financial results from the date of acquisition, a comparison of
    our <FONT style="white-space: nowrap">period-to</FONT>-period
    financial results may not necessarily be meaningful. See
    &#147;Unaudited Pro Forma Condensed Consolidated Financial
    Data,&#148; which shows what our results of operations might
    have been had we acquired Williamson Oil on January&nbsp;1, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155&nbsp;days in the fiscal period ended
    September&nbsp;30, 2005. Because the results of operations of
    the Tyler refinery and related assets are included in our
    financial results from the date of acquisition, a comparison of
    our <FONT style="white-space: nowrap">period-to</FONT>-period
    financial results may not necessarily be meaningful. See
    &#147;Unaudited Pro Forma Condensed Consolidated Financial
    Data,&#148; which shows what our results of operations might
    have been in 2004 and the nine months ended September&nbsp;30,
    2005 had we acquired the Tyler refinery and related assets on
    January&nbsp;1, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    In order to mitigate the risks of changes in the market price of
    crude oil and refined petroleum products, we entered into
    forward contracts to fix the purchase price of crude and sales
    price of specific refined petroleum products for a predetermined
    number of units at a future date. The fair value adjustment of
    these contracts in the third quarter of 2005 resulted in a loss
    of $10.9&nbsp;million. These contracts were entered into with an
    affiliate of Citigroup Global Markets Inc., one of the
    underwriters of this offering.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    In 2005, we refinanced a significant portion of our existing
    debt. As a result, financing costs associated with the
    refinanced debt were written-off.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(5)&nbsp;</TD>
    <TD align="left">
    We have entered into interest rate swap and cap agreements in
    connection with a portion of our floating rate debt. These
    interest rate swap and cap agreements are marked to fair value
    each period.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(6)&nbsp;</TD>
    <TD align="left">
    In 2005, our parent company guaranteed a portion of our new debt
    and other instruments in connection with the acquisition of the
    Tyler refinery. We have agreed to pay our parent a fee for these
    guarantees.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(7)&nbsp;</TD>
    <TD align="left">
    Gives effect to
    a &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;for-one
    split of our common stock, which will be effective immediately
    prior to this offering.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(8)&nbsp;</TD>
    <TD align="left">
    Statement of Accounting Standards No.&nbsp;131, <I>Disclosures
    About Segments of an Enterprise and Related Information,</I>
    requires disclosure of a measure of segment profit or loss. In
    connection with the purchase of the Tyler refinery and related
    assets on April&nbsp;29, 2005, management began viewing our
    company&#146;s operating results in two reportable
    segments:&nbsp;retail and refining. We measure the operating
    performance of each segment based on segment contribution
    margin. We define segment contribution margin as net sales less
    cost of goods sold and operating expenses, excluding
    depreciation and amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    For the retail segment, cost of goods sold comprises the costs
    of specific products sold. Operating expenses include costs such
    as wages of employees at the stores, lease expense for the
    stores, utility expense for the stores and other costs of
    operating the stores, excluding depreciation and amortization.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">40

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp; &nbsp;</TD>
    <TD align="left">
    For the refining segment, cost of goods sold includes all the
    costs of crude oil, feedstocks and related transportation.
    Operating expenses include the costs associated with the actual
    operations of the refinery, excluding depreciation and
    amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp; &nbsp;</TD>
    <TD align="left">
    Prior to the purchase of the Tyler refinery and related assets,
    we had only the retail segment. Accordingly, segment data prior
    to 2005 is not applicable.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp; (9)&nbsp;</TD>
    <TD align="left">
    Consists of fuel credit card services provided by one of our
    subsidiaries and eliminations of intercompany indebtedness.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(10)&nbsp;</TD>
    <TD align="left">
    EBITDA represents earnings before income tax expense, interest
    expense, the write-off of deferred financing costs, (gain) loss
    on derivative instruments, guarantee fees, depreciation and
    amortization. Adjusted EBITDA represents earnings before income
    tax expense, interest expense, the write-off of deferred
    financing costs, (gain)&nbsp;loss on derivative instruments,
    losses on forward contract activities, guarantee fees,
    depreciation, amortization and (gain) loss on disposal of
    assets. EBITDA and Adjusted EBITDA, however, are not recognized
    measurements under GAAP. Our management believes that the
    presentation of Adjusted EBITDA is useful to investors because
    it is frequently used by securities analysts, investors and
    other interested parties in the evaluation of companies in our
    industry.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    In addition, our management believes that Adjusted EBITDA is
    useful in evaluating our operating performance compared to that
    of other companies in our industry because the calculation of
    Adjusted EBITDA generally eliminates the effects of financings,
    income taxes, risk management activities and the disposal of
    assets, items which may vary for different companies for reasons
    unrelated to overall operating performance.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA has limitations as an analytical tool, and you
    should not consider it in isolation, or as a substitute for
    analysis of our results as reported under GAAP. Some of these
    limitations are:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or contractual commitments;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA does not reflect the interest expense or the
    cash requirements necessary to service interest or principal
    payments on our debt;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Adjusted EBITDA does not reflect changes in or cash requirements
    for our working capital needs;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Our calculation of Adjusted EBITDA may differ from the EBITDA
    and Adjusted EBITDA calculations of other companies in our
    industry, limiting its usefulness as a comparative measure.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">41

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;&nbsp;&nbsp;</TD>
    <TD align="left">
    Because of these limitations, Adjusted EBITDA should not be
    considered a measure of discretionary cash available to us to
    invest in the growth of our business. We compensate for these
    limitations by relying primarily on our GAAP results and using
    Adjusted EBITDA only on a supplemental basis.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table reconciles net income (loss) to Adjusted
EBITDA for the periods presented:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="34%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period from</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Inception</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>(April&nbsp;10,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001) to</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2001</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Net income (loss)</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>39,520</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,365</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,269</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,779</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,052</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on derivative instruments(5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees(6)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,553</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,674</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>794</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    EBITDA</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,018</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24,828</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32,835</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,950</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>89,171</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Loss on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Adjusted EBITDA</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>11,006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>15,018</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,398</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>31,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>22,723</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>98,456</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(11)&nbsp;</TD>
    <TD align="left">
    Refining operating margin per barrel is calculated by dividing
    the margin between net sales and cost of crude oil, feedstocks
    and related transportation by the total barrels sold at our
    refinery. <FONT style="white-space: nowrap">Industry-wide</FONT>
    refining results are driven and measured by the margins between
    refined petroleum product prices and the prices for crude oil,
    which are referred to as crack spreads: the differential in
    price between a representative barrel of benchmark refined
    petroleum products, such as gasoline or heating oil, and a
    barrel of benchmark crude oil. The US Gulf Coast&nbsp;5-3-2
    crack spread represents the differential between the
    Platt&#146;s quotations for
    <FONT style="font-size: 70%"><SUP>3</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of US Gulf Coast Pipeline&nbsp;87 Octane
    Conventional Gasoline and
    <FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of US Gulf Coast Pipeline No.&nbsp;2 Heating Oil
    (high sulfur diesel) on the one hand, and the first month
    futures price of
    <FONT style="font-size: 70%"><SUP>5</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of light sweet crude oil on the New York Mercantile
    Exchange, on the other hand. We compare our refining operating
    margin to these crack spreads to assess our operating
    performance relative to other participants in our industry.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">42

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='109'></A>
</DIV>

<!-- link1 "" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL DATA</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following unaudited pro forma condensed consolidated
financial data give effect to the following acquisitions:
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Our acquisition on April&nbsp;30, 2004 of 100% of the issued and
    outstanding stock of Williamson Oil, including operating assets,
    working capital and related debt for 89&nbsp;company-operated
    retail fuel and convenience stores and a wholesale fuel and
    merchandise distribution operation with 11 company-owned but not
    operated retail fuel and convenience stores, located primarily
    in the state of Alabama. We refer to this transaction as the
    Williamson Oil acquisition. The total cash consideration we paid
    in connection with the Williamson Oil acquisition was
    approximately $19.8&nbsp;million. In addition, we assumed debt
    of $28.6&nbsp;million in connection with this acquisition.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Our acquisition on April&nbsp;29, 2005 of the Tyler refinery and
    crude oil pipeline assets located in Tyler, Texas. We refer to
    this transaction as the Tyler refinery acquisition. The total
    consideration we paid in connection with the Tyler refinery
    acquisition was approximately $68.1&nbsp;million, including
    $25.9&nbsp;million of prepaid crude inventory and
    $38.4&nbsp;million of assumed crude vendor liabilities.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Williamson Oil acquisition and the Tyler refinery
acquisition have each been accounted for using the purchase
method of accounting as prescribed by SFAS&nbsp;No.&nbsp;141.
The allocations of purchase prices to the underlying net assets
have been based on the estimates of fair value at the
acquisition dates.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following unaudited pro forma condensed consolidated
financial data give effect to the Williamson Oil acquisition and
the Tyler refinery acquisition, as if each transaction had been
consummated on January&nbsp;1, 2004 for statement of operations
purposes.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our historical financial information for the year ended
December&nbsp;31, 2004 was derived from our audited consolidated
financial statements of the same period included elsewhere in
this prospectus and the historical financial information for the
nine months ended September&nbsp;30, 2005 was derived from the
unaudited condensed consolidated financial statements for the
same periods included elsewhere in this prospectus. The results
of operations of Williamson Oil and the Tyler refinery,
respectively, are included in our historical results from
April&nbsp;30, 2004 and April&nbsp;29, 2005, the respective
closing dates of the Williamson Oil and the Tyler refinery
acquisitions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The historical financial information of Williamson Oil included
in the unaudited pro forma condensed consolidated financial data
represents the results of operations of Williamson Oil for the
period prior to its acquisition by us on April&nbsp;30, 2004 and
was derived from unaudited financial information of Williamson
Oil for the period from January&nbsp;1, 2004 to April&nbsp;29,
2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The historical financial information of the Tyler refinery for
the year ended December&nbsp;31, 2004 was derived from the
audited combined financial statements for the same period
included elsewhere in this prospectus. The historical financial
information of the Tyler refinery for the period prior to its
acquisition by us on April&nbsp;29, 2005 was derived from
unaudited financial information of the Tyler refinery for the
period from January&nbsp;1, 2005 to April&nbsp;28, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The unaudited pro forma condensed consolidated financial data
include adjustments, which are based upon preliminary estimates
in the case of the Tyler refinery acquisition, to reflect the
allocation of purchase price to net tangible and intangible
assets acquired in each of the business combinations, as well as
preliminary estimates of transaction costs in the case of the
Tyler refinery acquisition. The preliminary purchase price
allocations and other estimates are subject to revision as more
detailed analysis is completed and additional information
becomes available. Financial purchase accounting adjustments may
differ materially from pro forma adjustments presented in this
prospectus.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The unaudited pro forma condensed consolidated financial data
have been presented for illustrative purposes only and are not
necessarily indicative of either future results or the results
that might have been recorded if the business combinations had
been consummated on such dates. These unaudited pro forma
condensed consolidated financial data should be read in
conjunction with the related notes. In addition, these unaudited
pro forma condensed consolidated financial data are based upon
and should be read in conjunction with the historical financial
statements and related notes thereto discussed above.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">43

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Delek US Holdings, Inc.</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Unaudited Pro Forma Consolidated Statements of Operations</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>For the Year Ended December&nbsp;31, 2004</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 8pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Historical</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Delek</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Williamson</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>US Holdings, Inc.</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Tyler Refinery</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Oil Co., Inc.</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Pro Forma Adjustments</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>for the Year</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>for the</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>from</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Year Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>January&nbsp;1, 2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Williamson</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Pro Forma</B></TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31, 2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31, 2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>to April&nbsp;29, 2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Tyler Refinery</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Oil Co., Inc.</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Consolidated</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>857,899</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>839,212</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>78,456</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,775,567</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating costs and expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>730,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>796,078</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>68,702</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(197</TD>
    <TD align="left" valign="bottom" nowrap>)(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,533,487</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(61,876</TD>
    <TD align="left" valign="bottom" nowrap>)(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80,060</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,762</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61,876</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>150,317</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>619</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(c)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,122</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,074</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,370</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(619</TD>
    <TD align="left" valign="bottom" nowrap>)(c)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,947</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,891</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,362</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,031</TD>
    <TD align="left" valign="bottom" nowrap>)(d)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(88</TD>
    <TD align="left" valign="bottom" nowrap>)(d)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,508</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Impairment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,301</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,301</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(95</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(960</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>837,438</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>821,249</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>79,229</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,228</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(88</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,733,600</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,963</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(773</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,228</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>88</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,967</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense (income), net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,269</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,221</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>871</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,975</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(e)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,894</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,560</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(f)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>151</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(f)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,160</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(g)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(871</TD>
    <TD align="left" valign="bottom" nowrap>)(h)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Loss on interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD align="left" valign="bottom" nowrap>&nbsp;(i)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 8pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,996</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,221</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>871</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>440</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,371</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,184</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,644</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,057</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(352</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26,596</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,987</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,102</TD>
    <TD align="left" valign="bottom" nowrap>)(j)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(127</TD>
    <TD align="left" valign="bottom" nowrap>)(j)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,890</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$13,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(1,644</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(1,955</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(225</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$16,706</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings per share</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$73,330</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$167,060</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average common shares and equivalents outstanding,
    basic and diluted</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    (a)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment includes amounts to eliminate historical
    seller&#146;s pension expense of the Tyler refinery arising from
    the seller&#146;s defined benefit plan, which were accounted for
    as direct operating costs of the Tyler refinery and included in
    cost of goods sold. We do not sponsor a defined benefit plan.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (b)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects the reclassification of certain Tyler
    refinery cost of goods sold to operating expenses to conform
    with our presentation.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">44

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    (c)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects the reclassification of certain Tyler
    refinery general and administrative expenses to operating
    expenses to conform with our presentation.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (d)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects amounts to eliminate historical
    depreciation of $5.9&nbsp;million and $1.4&nbsp;million for the
    Tyler refinery and Williamson Oil, respectively, and the
    inclusion of our depreciation of $1.9&nbsp;million and
    $1.3&nbsp;million for the Tyler refinery and Williamson Oil,
    respectively, using our new basis as a result of the purchase
    price allocations in accordance with SFAS&nbsp;141, <I>Business
    Combinations</I>.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (e)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects interest expense related to the debt
    used to finance the acquisition of the Tyler refinery
    (1)&nbsp;with third parties in the aggregate principal amount of
    $50.0&nbsp;million at a combined interest rate of 5.05% and
    (2)&nbsp;with a related party in the aggregate principal amount
    of $35.0&nbsp;million at an interest rate of 7.00%.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (f)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects amortization of deferred financing costs
    capitalized in connection with the execution of certain loans
    used to finance the Williamson Oil and Tyler refinery
    acquisitions.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (g)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects interest expense related to the debt
    used to finance the Williamson Oil acquisition (1)&nbsp;with a
    third party in the aggregate principal amount of
    $34.5&nbsp;million at an interest rate of 5.20% and
    (2)&nbsp;with a related party in the aggregate principal amount
    of $25.0&nbsp;million at an interest rate of 6.30%. Additional
    amounts include interest expense of $37,000 related to certain
    capital leases assumed in the Williamson Oil acquisition.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (h)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects amounts to eliminate the historical
    interest expense of Williamson Oil.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (i)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects fees related to a parent guaranty
    agreement in the aggregate principal amount of
    $50.0&nbsp;million at an interest rate of 1.50%.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (j)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects the tax effect of the pro forma
    adjustment utilizing our estimated effective income tax rate.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">45

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Delek US Holdings, Inc.</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Unaudited Pro Forma Consolidated Statements of Operations</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>For the Nine Months Ended September&nbsp;30, 2005</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="33%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Historical</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Delek US Holdings,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Inc. for the Nine</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Tyler Refinery from</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Months Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>January&nbsp;1, 2005 to</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Pro Forma</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Pro Forma</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>April&nbsp;28, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Adjustments</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Consolidated</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,387,541</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$280,292</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,667,833</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating costs and expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>270,120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(52</TD>
    <TD align="left" valign="bottom" nowrap>)(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,426,742</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(22,821</TD>
    <TD align="left" valign="bottom" nowrap>)(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,821</TD>
    <TD align="left" valign="bottom" nowrap>(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,380</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>273</TD>
    <TD align="left" valign="bottom" nowrap>(c)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>695</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(273</TD>
    <TD align="left" valign="bottom" nowrap>)(c)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,459</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>729</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(109</TD>
    <TD align="left" valign="bottom" nowrap>)(d)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,092</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract hedging activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,309,575</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>271,544</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(161</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,580,958</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,966</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,748</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>161</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>86,875</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense (income), net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,052</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(664</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,713</TD>
    <TD align="left" valign="bottom" nowrap>(e)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,621</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>520</TD>
    <TD align="left" valign="bottom" nowrap>(f)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs in connection with
    refinancing</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>250</TD>
    <TD align="left" valign="bottom" nowrap>(g)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>563</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,817</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(664</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,483</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,636</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,412</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,322</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,239</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,577</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(835</TD>
    <TD align="left" valign="bottom" nowrap>)(h)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,104</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before cumulative effect of change in accounting
    policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,787</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,835</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(1,487</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$44,135</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings per share</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$397,870</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$441,350</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average common shares and equivalents outstanding,
    basic and diluted</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    (a)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment includes amounts to eliminate historical
    seller&#146;s pension expense of the Tyler refinery arising from
    the seller&#146;s defined benefit plan, which were accounted for
    as direct operating costs of the Tyler refinery and included in
    cost of goods sold. We do not sponsor a defined benefit plan.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (b)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects the reclassification of certain Tyler
    refinery cost of goods sold to operating expenses to conform
    with our presentation.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (c)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects the reclassification of certain Tyler
    refinery general and administrative expenses to operating
    expenses to conform with our presentation.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (d)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects amounts to eliminate historical
    depreciation of $0.7&nbsp;million and the inclusion of our
    depreciation of $0.6&nbsp;million using our basis as a result of
    the purchase price allocation in accordance with SFAS&nbsp;141,
    <I>Business Combinations</I>.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">46

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    (e)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects interest expense related to the debt
    used to finance the acquisition of the Tyler refinery with
    (1)&nbsp;third parties in the aggregate principal amount of
    $50.0&nbsp;million at a combined interest rate of 5.05% and
    (2)&nbsp;with a related party in the aggregate principal amount
    of $35.0&nbsp;million at an interest rate of 7.00%.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (f)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects amortization of deferred financing costs
    capitalized in connection with the execution of certain loans
    used to finance the Tyler refinery acquisition.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (g)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects fees related to a parent guaranty
    agreement in the aggregate principal amount of
    $50.0&nbsp;million at an interest rate of 1.50%.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    (h)</TD>
    <TD></TD>
    <TD valign="top">
    The adjustment reflects the tax effect of the pro forma
    adjustments utilizing our estimated effective income tax rate.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">47

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='110'></A>
</DIV>

<!-- link1 "MANAGEMENT&#146;S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS OF</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>The following is a discussion and analysis of our financial
condition and results of operations for the years ended
December&nbsp;31, 2002, 2003 and 2004 and for the nine months
ended September&nbsp;30, 2004 and 2005. You should read this
discussion and analysis together with our consolidated financial
statements and notes to those consolidated financial statements
included elsewhere in this prospectus. This discussion contains
forward-looking statements that are based on management&#146;s
current expectations, estimates and projections about our
business and operations. Our actual results may differ from
those currently anticipated and expressed in such
forward-looking statements as a result of a number of factors,
including those described under the caption &#147;Risk
Factors&#148; and elsewhere in this prospectus.</I>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Company Overview</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a diversified energy business focused on petroleum
refining and supply and on retail marketing. Our business
consists of two main operating segments: refining and retail.
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <I>Refining segment.</I> Our refining segment operates a high
    conversion, moderate complexity independent refinery in Tyler,
    Texas, with a design crude distillation capacity of
    60,000&nbsp;bpd, along with an associated crude oil pipeline and
    light products loading facilities.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <I>Retail segment.</I> Our retail segment markets gasoline,
    diesel, other refined petroleum products and convenience
    merchandise through a network of 349&nbsp;company-operated
    retail fuel and convenience stores located in Alabama, Arkansas,
    Georgia, Kentucky, Louisiana, Mississippi, Tennessee and
    Virginia. We also have a wholesale fuel distribution operation.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a Delaware corporation formed in April 2001. We are an
indirect wholly-owned subsidiary of Delek Group Ltd., a
conglomerate that is domiciled and publicly traded in Israel,
which has significant interests in fuel supply businesses, and
which is controlled by Mr.&nbsp;Yitzchak Sharon Teshuva, an
Israeli citizen. We were formed by Delek Group Ltd. in
connection with our acquisition in May 2001 of 198 retail fuel
and convenience stores from a subsidiary of The Williams
Companies. Since then, we have completed several other
acquisitions of retail fuel and convenience stores. In 2005, we
expanded our scope of operations to include complementary
petroleum refining and wholesale and distribution businesses by
acquiring the Tyler refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Major Influences on Results of Operations</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refining.</I> Our earnings and cash flow from our refining
segment are primarily affected by the difference between refined
petroleum product prices and the prices for crude oil and other
feedstocks. The cost to acquire feedstocks and the price of the
refined petroleum products we ultimately sell depend on numerous
factors beyond our control, including the supply of, and demand
for, crude oil, gasoline and other refined petroleum products
which, in turn, depend on, among other factors, changes in
domestic and foreign economies, weather conditions, domestic and
foreign political affairs, production levels, the availability
of imports, the marketing of competitive fuels and government
regulation. While our sales and operating revenues fluctuate
significantly with movements in crude oil and refined petroleum
product prices, it is the spread between crude oil and refined
petroleum product prices, and not necessarily fluctuations in
those prices, that affects our earnings.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to measure our operating performance, we compare our
per barrel refining operating margin to certain industry
benchmarks, specifically the US Gulf Coast 5-3-2 crack spread.
The US Gulf Coast 5-3-2 crack spread represents the differential
between Platt&#146;s quotations for
<FONT style="font-size: 70%"><SUP>3</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
of a barrel of US Gulf Coast Pipeline 87 Octane Conventional
Gasoline and
<FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
of a barrel of US Gulf Coast Pipeline No.&nbsp;2 Heating Oil
(high sulfur diesel) on the one hand, and the first month
futures price of
<FONT style="font-size: 70%"><SUP>5</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
of a barrel of light sweet crude oil on the New York Mercantile
Exchange, on the other hand.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our refinery processes primarily light, sweet crude oils, and
converts approximately 97% of the crude oil and other feedstocks
into salable refined petroleum products. In addition to locally
produced crude oil grades,
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">48

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
we are able to access other domestic and foreign crude oils
available in Texas and on the US Gulf Coast through the
connection of our owned and leased pipelines to numerous common
carrier pipeline systems that converge in Longview, Texas,
enabling us to better optimize our crude supply. Our primary
market area commands a premium over US Gulf Coast refined
petroleum products prices generally in line with transportation
costs to import product into the region. As a result of the
flexibility in crude oil supply, our high conversion of crude
oil to light products, and transportation costs of others for
entry into our primary market area, our refining operating
margin before operating expense generally approximates the US
Gulf Coast 5-3-2 crack spread.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The results of operations from our refining segment are also
significantly affected by our Tyler refinery&#146;s operating
costs, particularly the cost of natural gas used for fuel and
the cost of electricity. Natural gas prices have historically
been volatile. For example, spot natural gas prices at Henry Hub
ranged between $5.50 and $7.82&nbsp;per million British Thermal
Units, or MMBTU, in the first half of 2005. During the second
half of 2005, primarily as a result of the loss of domestic
production related to damage from Hurricanes Katrina and Rita,
natural gas prices ranged between $7.00 and $15.39&nbsp;per
MMBTU. In our region, electricity prices fluctuate with natural
gas prices.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Demand for gasoline and margins on gasoline sales are generally
higher during summer months than during winter months due to
seasonal increases in highway traffic in our region. During the
winter months, demand for diesel fuel and margins on diesel
sales are generally higher than in the summer months, as
east-west trucking traffic moves south to avoid winter
conditions on northern routes. Since there is limited
flexibility on shifting the refinery yield structure from
gasoline to diesel, margins in the first and fourth quarters are
typically lower than margins in the second and third quarters.
Changes in regional supply/demand patterns, supply disruptions,
and general market conditions may offset these typical margin
patterns.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Reliability of our refinery operations is important to our
financial performance. Unplanned downtime of our refinery
generally results in lost refining operating margin opportunity,
increased maintenance costs and temporary changes in working
capital investment and inventory. The financial impact of
planned downtime, such as a turnaround or major maintenance
project, is mitigated through a diligent planning process that
considers product availability, margin environment and the
availability of resources to perform the required maintenance. A
major turnaround was conducted in February 2005 by the previous
owner. During December 2005, we successfully completed a major
turnaround covering all of the process units not involved in the
February turnaround. No additional turnaround activities are
planned prior to 2009.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The nature of our business requires us to maintain substantial
quantities of crude oil and refined petroleum product
inventories. Because crude oil and refined petroleum products
are commodities, we have no control over the changing market
value of these inventories. Because our inventory is valued at
the lower of cost or market value under the LIFO inventory
valuation methodology, price fluctuations generally have little
effect on our financial results, unless the market value of our
inventory drops below LIFO costs. For periods in which the
market price declines below our LIFO cost basis, we could be
subject to significant fluctuations in the recorded value of our
inventory and related cost of sales.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Retail.</I> Our earnings and cash flow from our retail
segment are primarily affected by the sales and margins of
retail merchandise and motor fuels at our convenience stores.
The cost to acquire the refined fuel products we ultimately sell
depends on numerous factors beyond our control, including the
supply of, and demand for, crude oil, gasoline and other refined
petroleum products which, in turn, depends on, among other
factors, changes in domestic and foreign economies, weather
conditions, domestic and foreign political affairs, production
levels, the availability of imports, the marketing of
competitive fuels and government regulation.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The gross margin of our retail merchandise is retail merchandise
sales less the delivered cost of the retail merchandise, net of
vendor discounts, measured as a percentage of total retail
merchandise sales. Our retail merchandise sales are driven by
convenience, customer service, competitive pricing and branding.
Motor fuel margin is sales less the delivered cost of fuel and
motor fuel taxes, measured on a cents per gallon, or cpg, basis.
Our motor fuel margins are impacted by local supply, demand,
weather and competitor pricing.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">49

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
There is some seasonality to our business with the summer and
warmer weather months providing higher sales and increased
traffic. As driving patterns are reduced in the cooler winter
months, traffic is reduced and sales can decline. Conversely,
merchandise margins typically increase in the cooler, winter
months as lower margin items like take-home beverages are
consumed and purchased less often. Weather conditions throughout
the year can also impact our business as rain typically reduces
customer traffic and sales, while warmer, dryer weather
generally increases traffic and sales. Changes in regional
supply/demand patterns, supply disruptions, and general market
conditions may offset these typical seasonal patterns.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Factors Affecting Comparability</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our financial condition and results of operations may not be
comparable with prior periods or to our results of operations in
the future due to the following factors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Acquisitions.</I> We have substantially increased the size
and scope of our operations through several significant
acquisitions. We purchased seven retail fuel and convenience
stores in February 2003 from Pilot Oil Corporation. These stores
contributed $38.4&nbsp;million to our net sales for 2003. In
April 2004, we acquired 100% of the issued and outstanding stock
of Williamson Oil Co., Inc., a chain of 89&nbsp;company-operated
retail fuel and convenience stores and a wholesale fuel and
merchandise distribution operation with 11&nbsp;company-owned
but not operated retail fuel and convenience stores, located
primarily in the state of Alabama. These stores contributed
$160.3&nbsp;million to our net sales for 2004. We operated these
assets for all of 2005. On April&nbsp;29, 2005, we purchased the
Tyler refinery assets from affiliates of Crown Central
Petroleum, LLC, which contributed $589.2&nbsp;million to our net
sales and $72.2&nbsp;million of refining segment contribution
margin in the period from April&nbsp;29, 2005 to
September&nbsp;30, 2005. On December&nbsp;15, 2005, we purchased
21 retail fuel and convenience stores, a network of four
wholesale operations, four undeveloped properties and inventory
in the Nashville, Tennessee area from BP.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refinancing and Prior Indebtedness.</I> In April 2005, we
amended and restated our existing secured term and revolving
credit facility for our MAPCO Express subsidiaries with a new
syndicate of lenders. This amended and restated agreement
increased the amount available to us under the lines of credit
to $205.0&nbsp;million and consolidated the borrowings of two
separate entities into a single credit facility. The amounts
outstanding under this facility at September&nbsp;30, 2005 were
$172.6&nbsp;million. In December 2005, we increased commitments
under our senior secured credit facility revolver by
$30.0&nbsp;million to $70.0&nbsp;million, and subsequently
borrowed $30.0&nbsp;million in connection with our acquisition
of retail fuel and convenience stores and other assets from BP.
See &#147;&#151;&nbsp;Liquidity and Capital
Resources&nbsp;&#151; Cash Position, Working Capital and
Indebtedness.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As part of the financing of our Tyler refinery acquisition in
April 2005, we entered into a number of debt arrangements: a
$30.0&nbsp;million promissory note payable to Israel Discount
Bank of New York; a $20.0&nbsp;million promissory note payable
to Bank Leumi USA; and a $35.0&nbsp;million promissory note
payable to Delek Group Ltd. We also entered into a
$250.0&nbsp;million asset-based senior revolving credit facility
with a syndicate of lenders, led by SunTrust Bank as
administrative agent, to finance ongoing working capital,
capital expenditures and general needs of the Tyler refinery.
See &#147;&#151;&nbsp;Liquidity and Capital
Resources&nbsp;&#151; Cash Position, Working Capital and
Indebtedness.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with these financing transactions, we incurred
$13.8&nbsp;million in new deferred financing expenses, plus an
additional $1.0&nbsp;million relating to our acquisition of
retail fuel and convenience stores and other assets from BP,
that will be amortized over the life of the specific facilities.
In addition, in the second quarter of 2005, we wrote-off
approximately $3.5&nbsp;million of financing costs previously
deferred and relating to debt that we refinanced.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Public Company Expenses.</I> We expect that our general and
administrative expenses will increase due to the costs of
operating as a public company, such as increases in legal,
accounting and compliance, insurance premiums, and investor
relations. We estimate that these costs will total approximately
$2.0 to $2.5&nbsp;million on an annual basis. Our financial
statements following this offering will reflect the impact of
these expenses and will affect the comparability with our
financial statements of periods prior to the completion of this
offering.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">50

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Stock Based Compensation Expense.</I> In accordance with our
adoption of SFAS&nbsp;No.&nbsp;123(R), <I>Share-Based
Payment,</I> effective January&nbsp;1, 2006, we will incur
additional expense associated with existing stock purchase
rights and future stock option grants and equity awards,
including stock options to be granted and restricted stock units
to be awarded in connection with this offering as described
under &#147;Management&nbsp;&#151; IPO Awards.&#148; We expect
the expense to be recognized in 2006 related to existing stock
purchase rights and the stock options to be granted in
connection with this offering to be approximately
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
assuming the consummation of this offering. Amounts related to
future stock option grants and equity awards will depend upon
the terms and levels of future awards.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Recently Issued Accounting Standards</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In March 2005, the FASB issued FIN 47, <I>Accounting for
Conditional Asset Retirement Obligations </I>(an interpretation
of SFAS&nbsp;No.&nbsp;143), which requires companies to
recognize a liability for the fair value of a conditional asset
retirement obligation when incurred if the amount can be
reasonably estimated. We adopted FIN-47 effective as of
January&nbsp;1, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Associated with the adoption of this standard, we recorded a
cumulative effect of adoption of $0.3&nbsp;million (net of
$0.2&nbsp;million of income taxes) and a long-term asset
retirement obligation of $1.5&nbsp;million.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Subsequent to adoption of FIN 47, we also recorded a long-term
asset retirement obligation on April 29, 2005 in connection with
our purchase of the Tyler refinery of $1.3&nbsp;million related
to the required disposal of waste in certain storage tanks. In
addition to this identified asset retirement obligation at the
Tyler refinery, we are continuing to evaluate the need for
additional asset retirement obligations related to the Tyler
refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In November 2004, the Financial Accounting Standards Board, or
FASB, issued Statement No.&nbsp;151, <I>Inventory Costs,</I>
which clarifies the accounting for abnormal amounts of idle
facility expense, freight, handling costs and wasted material
and requires that those items be recognized as current-period
charges. Statement No.&nbsp;151 also requires that allocation of
fixed production overhead to the costs of conversion be based on
the normal capacity of the production facilities. Statement
No.&nbsp;151 is effective for fiscal years beginning after
June&nbsp;15, 2005, and its impact on our financial position or
results of operations has not been determined.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004, the FASB issued SFAS&nbsp;No.&nbsp;123
(revised 2004), <I>Share-Based Payment,</I> which is a revision
of SFAS&nbsp;No.&nbsp;123, <I>Accounting for Stock-Based
Compensation.</I> SFAS&nbsp;No.&nbsp;123(R) supersedes APB
Opinion No.&nbsp;25, <I>Accounting for Stock Issued to Employees
</I>and amends SFAS&nbsp;No.&nbsp;95, Statement of Cash Flows.
Generally, the approach in SFAS&nbsp;No.&nbsp;123(R) is similar
to the approach described in SFAS&nbsp;No.&nbsp;123. However,
SFAS&nbsp;No.&nbsp;123(R) requires all share-based payments to
employees, including grants of employee stock options, to be
recognized in the income statement based on their fair values.
Pro forma disclosure is no longer an alternative.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Adoption of SFAS&nbsp;No.&nbsp;123(R) is required as of the
first interim or annual reporting period that begins after
June&nbsp;15, 2005. We will adopt the provisions of
SFAS&nbsp;No.&nbsp;123(R) effective January&nbsp;1, 2006.
SFAS&nbsp;No.&nbsp;123(R) permits public companies to adopt its
requirements using one of two methods:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a &#147;modified prospective&#148; method in which compensation
    cost is recognized beginning with the effective date
    (a)&nbsp;based on the requirements of SFAS&nbsp;No.&nbsp;123(R)
    for all share-based payments granted after the effective date
    and (b)&nbsp;based on the requirements of SFAS&nbsp;No.&nbsp;123
    for all awards granted to employees prior to the effective date
    of SFAS&nbsp;No.&nbsp;123(R) that remain unvested on the
    effective date; or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a &#147;modified retrospective&#148; method which includes the
    requirements of the modified prospective method described above,
    but also permits entities to restate based on the amounts
    previously recognized under SFAS&nbsp;No.&nbsp;123 for purposes
    of pro forma disclosures either (a)&nbsp;all prior periods
    presented or (b)&nbsp;prior interim periods of the year of
    adoption.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We plan to adopt SFAS&nbsp;No.&nbsp;123(R) using the modified
prospective method.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">51

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004, the FASB issued Statement No.&nbsp;153,
<I>Exchanges of Nonmonetary Assets,</I> which addresses the
measurement of exchanges of nonmonetary assets. Statement
No.&nbsp;153 eliminates the exception from fair value
measurement for nonmonetary exchanges of similar productive
assets, which was previously provided by APB Opinion
No.&nbsp;29, <I>Accounting for Nonmonetary Transactions,</I> and
replaces it with an exception for exchanges that do not have
commercial substance. Statement No.&nbsp;153 specifies that a
nonmonetary exchange has commercial substance if the future cash
flows of the entity are expected to change significantly as a
result of the exchange. Statement No.&nbsp;153 is effective for
nonmonetary asset exchanges occurring in fiscal periods
beginning after June&nbsp;15, 2005. The adoption of Statement
No.&nbsp;153 is not expected to affect our financial position or
results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In May 2005, the FASB issued SFAS&nbsp;No.&nbsp;154,
<I>Accounting Changes and Error Correction, a Replacement of APB
Opinion No.&nbsp;20 and FASB Statement No.&nbsp;3.</I> This
statement changes the requirements for accounting for and
reporting a change in accounting principles and applies to all
voluntary changes in accounting principles. It also applies to
changes required by an accounting pronouncement in the unusual
instance that the announcement does not include specific
transition provisions. When an announcement includes specific
transition provisions, those provisions should be followed. This
statement requires retrospective application to prior
periods&#146; financial statements to changes in accounting
principles unless it is impracticable to determine either the
period&#146;s specific effects or the cumulative effect of
change. This statement becomes effective for fiscal years
beginning after December&nbsp;15, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In September 2005, the Emerging Issues Task Force, or EITF,
reached a consensus concerning the accounting for linked
purchase and sale arrangements in EITF Issue No.&nbsp;04-13,
<I>Accounting for Purchases and Sales of Inventory with the Same
Counterparty.</I> The EITF concluded that non-monetary exchanges
of finished goods inventory within the same line of business be
recognized at the carrying value of the inventory transferred.
The consensus is to be applied to new buy/sell arrangements
entered in reporting periods beginning after March&nbsp;15,
2006. We do not expect the impact of this EITF Issue
No.&nbsp;04-13 consensus to have a material effect on our
financial position or results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Critical Accounting Policies</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our accounting policies are described in the notes to our
audited consolidated financial statements included elsewhere in
this prospectus. We prepare our consolidated financial
statements in conformity with U.S.&nbsp;GAAP. In order to apply
these principles, we must make judgments, assumptions and
estimates based on the best available information at the time.
Actual results may differ based on the accuracy of the
information utilized and subsequent events, some of which we may
have little or no control over. Our critical accounting
policies, which are described below, could materially affect the
amounts recorded in our consolidated financial statements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Inventory.</I> Refinery inventory consists of crude oil,
refined petroleum products and blendstocks which are stated at
the lower of cost or market. Cost is determined under LIFO
valuation method. The LIFO method requires management to make
estimates on an interim basis of the anticipated on-hand
year-end inventory quantities, which could differ from actual
quantities. Cost of crude oil, refined petroleum product and
blendstock inventories in excess of market value are charged to
cost of goods sold. Such changes are subject to reversal in
subsequent periods, not to exceed LIFO cost, if prices recover.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Retail merchandise inventory consists of gasoline, diesel fuel,
other petroleum products, cigarettes, beer, convenience
merchandise and food service merchandise. Fuel inventories are
stated at the lower of cost or market on a
<FONT style="white-space: nowrap">first-in,</FONT> first-out, or
FIFO, basis. Non-fuel inventories are stated at estimated cost
as determined by the retail inventory method.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Revenue Recognition.</I> In both of our operating segments,
revenues for products sold are recorded at the point of sale
upon delivery of product, which is the point at which title to
the product is transferred, and when payment has either been
received or collection is reasonably assured. In our retail
segment, we derive service revenue from the sale of lottery
tickets, money orders and other ancillary product and service
offerings. Service revenue and related costs are recorded at
gross amounts and net amounts, as appropriate, in accordance
with the provisions of the FASB EITF&nbsp;99-19, <I>Reporting
Revenue Gross as a Principal Versus Net</I>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">52

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<I>as an Agent. </I>We record service revenue and related costs
at gross amounts when we are the primary obligor, are subject to
inventory risk, have latitude in establishing prices and
selecting suppliers, influence product or service
specifications, or have several but not all of these indicators.
We record service revenues net of costs when we are not the
primary obligor and do not possess other indicators of gross
reporting as discussed.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Vendor Discounts and Deferred Revenue.</I> We receive cash
discounts or cash payments from certain vendors related to
product promotions based upon factors such as quantities
purchased, quantities sold, merchandise exclusivity, store space
and various other factors. In accordance with the provisions of
the FASB EITF
Issue&nbsp;<FONT style="white-space: nowrap">02-16,</FONT>
<I>Accounting by a Reseller for Consideration Received from a
Vendor,</I> we recognize these amounts as a reduction of
inventory until the products are sold, at which time the amounts
are reflected as a reduction in cost of goods sold. Certain of
these amounts are received from vendors related to agreements
covering several periods. These amounts are initially recorded
as deferred revenue, are reclassified as a reduction in
inventory upon receipt of the products and are subsequently
recognized as a reduction of cost of goods sold as the products
are sold.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We also receive advance payments from certain vendors related to
contractual agreements. These amounts are recorded as deferred
revenue and are subsequently recognized in revenue as earned in
accordance with the terms of the agreements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Environmental Expenditures.</I> It is our policy to accrue
environmental and
<FONT style="white-space: nowrap">clean-up</FONT> related costs
of a non-capital nature when it is both probable that a
liability has been incurred and the amount can be reasonably
estimated. Environmental liabilities represent the current
estimated costs to investigate and remediate contamination at
our properties. This estimate is based on third-party
assessments of the extent of the contaminations, the selected
remediation technology and review of applicable environmental
regulations. Accruals for estimated costs from environmental
remediation obligations generally are recognized no later than
completion of the remedial feasibility study and include, but
are not limited to, costs to perform remedial actions and costs
of machinery and equipment that is dedicated to the remedial
actions and that does not have an alternative use. Such accruals
are adjusted as further information develops or circumstances
change. We do not discount environmental liabilities to their
present value unless payments are fixed and determinable.
Expenditures for equipment necessary for environmental issues
relating to ongoing operations are capitalized.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Derivatives.</I> We currently record all derivative financial
instruments, such as interest rate swap and cap agreements, fuel
related derivatives and forward contracts at estimated fair
value regardless of their intended use in accordance with the
provisions of SFAS&nbsp;No.&nbsp;133, <I>Accounting for
Derivative Instruments and Hedging Activities,</I> as amended
and interpreted. Changes in the fair value of the derivative
instruments are recognized periodically in operations as we have
elected to not comply with the hedging requirements of
SFAS&nbsp;No.&nbsp;133, which allow such changes to be
classified as comprehensive income. We obtain the fair value of
all derivative financial instruments on a monthly basis from
third party financial and brokerage institutions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Summary Financial and Other Information</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following tables provide summary financial data and selected
key operating statistics for us and our two operating segments.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="41%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Statement of Operations Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>857,834</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>617,955</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>798,974</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refining</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>588,326</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>241</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>857,899</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>617,971</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">53

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="41%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>460,337</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>500,181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>730,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>526,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,704</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80,060</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58,289</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,227</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,122</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,665</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,674</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>542,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>584,113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>837,438</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>603,695</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,309,575</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,592</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,044</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,276</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="22">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,059</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense&nbsp;&#151; related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,210</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>778</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,287</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on derivative instruments(5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees(6)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,330</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,996</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,654</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,817</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before income taxes and cumulative effect of
    change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(738</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,622</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,149</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,787</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>39,520</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="22">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings (loss) per share(7):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average shares, basic and diluted(7)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">54

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="44%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except per share data)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash Flow Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>17,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>26,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,926</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>16,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>139,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,066</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(16,149</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(27,343</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(26,763</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(83,588</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,465</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,616</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,962</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,279</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (decrease) increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>7,942</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,199</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,417</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>124,921</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="50%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>As of December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>As of</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance Sheet Data:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>10,965</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>18,907</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>22,106</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>147,027</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40,016</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>46,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,094</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>336,534</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and equipment, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>130,892</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>136,538</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>189,293</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>219,418</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>256,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>330,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>641,558</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,324</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>72,285</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>227,971</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total debt, including current maturities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>161,713</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>168,752</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>203,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total noncurrent liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>152,821</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>159,793</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>202,134</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>318,313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,941</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,421</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>256,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>330,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>641,558</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Segment Data(8):</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="37%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>Nine Months Ended September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Corporate,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Other and</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Refining(2)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retail</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Eliminations(9)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Consolidated</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales (excluding intercompany sales)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$588,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$798,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$241</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Intercompany sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>489,401</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>690,982</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,636</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,402</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>248</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Segment contribution margin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$72,177</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$43,590</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(7</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,760</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">55

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>REFINING SEGMENT</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="38%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands, except pricing information)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Days operated in period(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>155</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total sales volume (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,646</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="22">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Products manufactured (average barrels per day)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gasoline</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,366</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Diesel/ Jet</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,288</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petrochemicals, LPG, NGLs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,517</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,061</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total production</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,232</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="22">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Throughput (average barrels per day) Crude oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,887</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other feedstocks</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>878</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total throughput</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="22">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Per barrel of sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refining operating margin(10)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>12.23</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Direct operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3.39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="22">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Pricing statistics (average for the period presented)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    WTI&nbsp;&#151; Cushing crude oil (per barrel)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>59.05</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    US Gulf Coast 5-3-2 crack spread (per barrel)(11)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>13.75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    US Gulf Coast Unleaded Gasoline (per gallon)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1.76</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Low sulfur diesel (per gallon)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1.75</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Natural gas&nbsp;&#151; (per MMBTU)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>8.40</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>RETAIL SEGMENT</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="41%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Number of stores (end of period)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>243</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>328</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average number of stores</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>242</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>310</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>329</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel sales (thousands of gallons)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,396</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,476</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>315,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>231,315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>249,507</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average gallons per average number of stores (in thousands)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,133</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>766</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>758</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel margin (per gallon)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.130</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.155</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.164</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise sales without lottery</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$204,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$206,950</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$261,932</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$191,728</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$219,840</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise margin % with lottery</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26.7</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">56

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="1%"></TD>
    <TD width="3%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;30, 2004, we completed the acquisition of
    100% of the outstanding stock of Williamson Oil. Because the
    results of operations of Williamson Oil are included in our
    financial results from the date of acquisition, a comparison of
    our <FONT style="white-space: nowrap">period-to</FONT>-period
    financial results may not necessarily be meaningful. See
    &#147;Unaudited Pro Forma Condensed Consolidated Financial
    Data,&#148; which shows what our results of operations might
    have been had we acquired Williamson Oil on January&nbsp;1, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155&nbsp;days in the fiscal period ended
    September&nbsp;30, 2005. Because the results of operations of
    the Tyler refinery and related assets are included in our
    financial results from the date of acquisition, a comparison of
    our <FONT style="white-space: nowrap">period-to</FONT>-period
    financial results may not necessarily be meaningful. See
    &#147;Unaudited Pro Forma Condensed Consolidated Financial
    Data,&#148; which shows what our results of operations might
    have been in 2004 and the nine months ended September&nbsp;30,
    2005 had we acquired the Tyler refinery and related assets on
    January&nbsp;1, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    In order to mitigate the risks of changes in the market price of
    crude oil and refined petroleum products, we entered into
    forward contracts with major financial institutions to fix the
    purchase price of crude and sales price of specific refined
    petroleum products for a predetermined number of units at a
    future date. The fair value adjustment of these contracts in the
    third quarter of 2005 resulted in a loss of $10.9&nbsp;million.
    These contracts were entered into with an affiliate of Citigroup
    Global Markets Inc., one of the underwriters of this offering.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    In 2005, we refinanced a significant portion of our existing
    debt. As a result, financing costs associated with the previous
    debt were written-off.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(5)&nbsp;</TD>
    <TD align="left">
    In order to economically hedge a portion of our floating rate
    debt, we enter into interest rate swap and cap agreements. These
    interest rate swap and cap agreements are marked to fair value
    each period.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(6)&nbsp;</TD>
    <TD align="left">
    In 2005, our parent company guaranteed a portion of our new debt
    and other instruments in connection with the acquisition of the
    Tyler refinery. We have agreed to pay our parent a fee for these
    guarantees.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(7)&nbsp;</TD>
    <TD align="left">
    Gives effect to
    a &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;for-one
    split of our common stock, which will be effective immediately
    prior to this offering.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(8)&nbsp;</TD>
    <TD align="left">
    Statement of Accounting Standards No.&nbsp;131, <I>Disclosures
    About Segments of an Enterprise and Related Information,</I>
    requires disclosure of a measure of segment profit or loss. In
    connection with the purchase of the Tyler refinery and related
    assets on April&nbsp;29, 2005, management began viewing our
    company&#146;s operating results in two reportable segments:
    retail and refining. We measure the operating performance of
    each segment within the two reportable segments based on segment
    contribution margin. We define segment contribution margin as
    net sales less cost of goods sold and operating expenses,
    excluding depreciation and amortization.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">
    For the retail segment, cost of goods sold includes the costs of
    specific products sold. Operating expenses include costs such as
    wages of employees at the stores, lease expense for the stores,
    utility expense for the stores and other costs of operating the
    stores, excluding depreciation and amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">
    For the refining segment, cost of goods sold includes all the
    costs of crude oil, feedstocks and related transportation.
    Operating expenses include the costs associated with the actual
    operations of the refinery, excluding depreciation and
    amortization.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left">
    Prior to the purchase of the Tyler refinery and related assets,
    we had only the retail segment, thus segment data prior to 2005
    is not applicable.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="1%"></TD>
    <TD width="3%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>(9)&nbsp;</TD>
    <TD align="left">
    Consists of fuel credit card services provided by one of our
    subsidiaries and eliminations of intercompany indebtedness.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(10)&nbsp;</TD>
    <TD align="left">
    Refining operating margin per barrel is calculated by dividing
    the margin between net sales and cost of crude oil, feedstocks
    and related transportation by the total barrels sold at our
    refinery. Industry-wide refining results are driven and measured
    by the margins between refined petroleum product prices and the
    prices for crude oil, which are referred to as crack spreads. We
    compare our refining operating margin to these crack spreads to
    assess our operating performance relative to other participants
    in our industry.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>(11)&nbsp;</TD>
    <TD align="left">
    The differential in price between a representative barrel of
    benchmark refined petroleum products, such as gasoline or
    heating oil, and a barrel of benchmark crude oil is known as a
    crack spread. The US Gulf Coast 5-3-2 crack spread represents
    the differential between Platt&#146;s quotations for
    <FONT style="font-size: 70%"><SUP>3</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of US Gulf Coast Pipeline 87 Octane Conventional
    Gasoline and
    <FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of US Gulf Coast Pipeline No.&nbsp;2 Heating Oil
    (high sulfur diesel) on the one hand, and the first month
    futures price of
    <FONT style="font-size: 70%"><SUP>5</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
    of a barrel of light sweet crude oil on the New York Mercantile
    Exchange, on the other hand.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">57

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Results of Operations</B>
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Nine Months Ended September&nbsp;30, 2005 Compared to the
    Nine Months Ended September&nbsp;30, 2004</I></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Net Sales</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Consolidated.</I> Net sales were $1,387.5&nbsp;million for
the nine months ended September&nbsp;30, 2005, compared to
$618.0&nbsp;million for the nine months ended September&nbsp;30,
2004, an increase of $769.5&nbsp;million or 124.5%. The increase
in net sales was primarily due to $589.2&nbsp;million in net
sales from the purchase of the Tyler refinery, higher average
retail fuel prices at our convenience stores and the inclusion
of a full nine months of sales from the acquisition of
Williamson Oil stores compared to only five months in the nine
months ended September&nbsp;30, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refining Segment.</I> Operations in our refining segment
began with the acquisition of the Tyler refinery on
April&nbsp;29, 2005. Net sales were $589.2&nbsp;million for the
period from April&nbsp;29, 2005 through September&nbsp;30, 2005,
including $0.9&nbsp;million of intercompany sales. Total sales
volume was 8.2&nbsp;million barrels at an average sales price of
$72.20&nbsp;per barrel. Sales volume for refined gasoline was
4.2&nbsp;million barrels at an average sales price of
$75.50&nbsp;per barrel. Sales volume for diesel/jet was
3.3&nbsp;million barrels at an average sales price of
$73.32&nbsp;per barrel. Sales volume for other product was
0.6&nbsp;million barrels at an average sales price of
$41.90&nbsp;per barrel.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Retail Segment.</I> Net sales for our retail segment were
$799.0&nbsp;million for the nine months ended September&nbsp;30,
2005, compared to $618.0&nbsp;million for the nine months ended
September&nbsp;30, 2004, an increase of $181.0&nbsp;million or
29.3%. This increase was primarily due to a 24.1% increase in
average retail fuel prices and $79.2&nbsp;million in net sales
resulting from the inclusion of a full nine months of sales from
the acquisition of Williamson Oil stores compared to only five
months in the nine months ended September&nbsp;30, 2004.
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <I>Fuel Sales and Gallons.</I> Retail fuel sales were
    249.5&nbsp;million gallons for the nine months ended
    September&nbsp;30, 2005, compared to 231.3&nbsp;million gallons
    for the nine months ended September&nbsp;30, 2004. This increase
    was primarily due to the inclusion of a full nine months of
    sales from the acquisition of Williamson Oil stores compared to
    only five months in the nine months ended September&nbsp;30,
    2004, which led to an increase of 21.6&nbsp;million gallons.
    This increase was offset by approximately 1.2&nbsp;million
    gallons lost in the divestiture of stores and the estimated
    2.6&nbsp;million gallon impact of Hurricane Katrina. Total fuel
    sales, including wholesale gallons, were $579.1&nbsp;million for
    the nine months ended September&nbsp;30, 2005, compared to
    $426.2&nbsp;million over the same period in 2004, an increase of
    $152.9&nbsp;million or 35.9%. The increase was primarily due to
    an increase of $0.42 per gallon in the average retail price per
    gallon ($2.16&nbsp;per gallon compared to $1.74&nbsp;per gallon)
    and $58.3&nbsp;million in fuel sales resulting from the
    inclusion of a full nine months of fuel sales from the
    acquisition of Williamson Oil stores compared to only five
    months in the nine months ended September&nbsp;30, 2004.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <I>Merchandise Sales.</I> Merchandise sales were
    $219.8&nbsp;million for the nine months ended September&nbsp;30,
    2005, compared to $191.7&nbsp;million over the same period in
    2004, an increase of $28.1&nbsp;million or 14.7%. The increase
    in merchandise sales was primarily due to $20.8&nbsp;million in
    merchandise sales resulting from the inclusion of a full nine
    months of merchandise sales from the acquisition of Williamson
    Oil stores compared to only five months in the nine months ended
    September&nbsp;30, 2004, and increases in the cigarette and
    dairy categories. Comparable store (company stores operated for
    the entire period for both the nine-month periods ended
    September&nbsp;30, 2005 and September&nbsp;30, 2004) merchandise
    sales increased by 1.5% primarily due to increases in the
    cigarette and dairy categories which were driven by competitive
    pricing and merchandising strategies.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">58

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cost of Goods Sold</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Consolidated.</I> Cost of goods sold was
$1,179.5&nbsp;million for the nine months ended
September&nbsp;30, 2005, compared to $526.3&nbsp;million for the
nine months ended September&nbsp;30, 2004, an increase of
$653.2&nbsp;million or 124.1%. Of this increase,
$489.4&nbsp;million was due to the cost of goods sold from the
recently acquired Tyler refinery, $70.1&nbsp;million was due to
the inclusion of a full nine months of results of operations
from the acquisition of Williamson Oil stores compared to only
five months in the nine months ended September&nbsp;30, 2004,
and the majority of the remaining increase was due to an
increase in the average fuel price at our retail fuel and
convenience stores.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refining Segment.</I> Cost of goods sold for our refining
segment was $489.4&nbsp;million for the period from
April&nbsp;29, 2005 through September&nbsp;30, 2005,
approximating a cost per barrel sold of $59.97. This cost per
barrel resulted in a refining operating margin of
$99.8&nbsp;million or $12.23&nbsp;per barrel.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Retail Segment.</I> Cost of goods sold for our retail segment
was $691.0&nbsp;million for the nine months ended
September&nbsp;30, 2005, compared to $526.3&nbsp;million for the
nine months ended September&nbsp;30, 2004, an increase of
$164.7&nbsp;million or 31.3%. This increase was primarily due to
a 25.4% increase in average retail fuel costs and
$70.1&nbsp;million in cost of goods sold resulting from the
inclusion of a full nine months of results of operations from
the acquisition of Williamson Oil stores compared to only five
months in the nine months ended September&nbsp;30, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fuel cost of goods sold was $537.0&nbsp;million for the nine
months ended September&nbsp;30, 2005, compared to
$390.9&nbsp;million for the nine months ended September&nbsp;30,
2004, due to a 25.4% increase in retail fuel costs and a
23.8&nbsp;million increase in gallons sold. Merchandise cost of
goods sold was $154.0&nbsp;million for the nine months ended
September&nbsp;30, 2005, compared to $135.4&nbsp;million for the
nine months ended September&nbsp;30, 2004. The increase in
merchandise cost of goods sold was primarily due to
$14.6&nbsp;million in costs of goods sold resulting from the
inclusion of a full nine months of results of operations from
the acquisition of Williamson Oil stores compared to only five
months in the nine months ended September&nbsp;30, 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Operating Expenses</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Operating expenses were $92.3&nbsp;million for the nine months
ended September&nbsp;30, 2005, compared to $58.3&nbsp;million
for the nine months ended September&nbsp;30, 2004, an increase
of $34.0&nbsp;million or 58.3%. Of this increase,
$27.6&nbsp;million was due to operating costs from the recently
acquired Tyler refinery, which approximated $3.39&nbsp;per
barrel sold. In addition, we had $7.1&nbsp;million in store
operating costs from the inclusion of a full nine months of
results of operations from the acquisition of Williamson Oil
stores compared to only five months in the nine months ended
September&nbsp;30, 2004. The ratio of operating expenses to net
sales of our retail operations declined from 9.4% to 8.1% due to
higher sales per store driven by higher fuel prices and
continued expense controls.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>General and Administrative Expenses</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
General and administrative expenses were $17.0&nbsp;million for
the nine months ended September&nbsp;30, 2005, compared to
$10.7&nbsp;million for the nine months ended September&nbsp;30,
2004, an increase of $6.3&nbsp;million or 58.9%. This increase
was primarily due to additional salary and related expenses in
our retail segment due in part to the inclusion of a full nine
months of results of operations from the acquisition of
Williamson Oil stores compared to only five months in the nine
months ended September&nbsp;30, 2004, and general and
administrative expenses from the acquisition of the Tyler
refinery.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Depreciation and Amortization</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization were $11.5&nbsp;million for the
nine months ended September&nbsp;30, 2005, compared to
$8.7&nbsp;million for the nine months ended September&nbsp;30,
2004. This increase was primarily due to $0.8&nbsp;million in
depreciation associated with the Tyler refinery along with
approximately $1.2&nbsp;million in additional depreciation
resulting from the inclusion of a full nine months of
depreciation from the acquisition of Williamson Oil stores
compared to only five months in the nine months ended
September&nbsp;30, 2004.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">59

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>(Gain) on Disposal of Assets</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the nine months ended September&nbsp;30, 2005, we
recognized a net pre-tax gain of $1.6&nbsp;million associated
with the sale of one convenience store partially offset by the
write-off of associated goodwill, compared to $0.2&nbsp;million
pre-tax gain for the nine months ended September&nbsp;30, 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Loss on Forward Contract Activities</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During August and September 2005, we entered into forward fuel
contracts to fix the purchase price of crude oil and sales price
of finished grade fuel for a predetermined number of units at a
future date, which had fulfillment terms of less than
60&nbsp;days. We recorded unrealized losses of
$10.9&nbsp;million during the nine months ended
September&nbsp;30, 2005, which are included as losses on forward
contract activities. These contracts, which are no longer in
place, were entered into with an affiliate of Citigroup Global
Markets Inc., one of the underwriters of this offering.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Interest Expense, Net, Interest Expense-Related Party,
    Write-off of Deferred Financing Costs, (Gain) Loss on Derivative
    Instruments and Guarantee Fees</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest expense, net was $10.8&nbsp;million for the nine months
ended September&nbsp;30, 2005, compared to $5.0&nbsp;million for
the nine months ended September&nbsp;30, 2004, an increase of
$5.9&nbsp;million or 120.4%. This increase was due to increased
indebtedness and letter of credit fees associated with the
purchase of the Tyler refinery and higher short-term interest
rates. Interest expense from related party notes payable for the
nine months ended September&nbsp;30, 2005 increased to
$2.3&nbsp;million from $0.8&nbsp;million in the nine months
ended September&nbsp;30, 2004 due to borrowings incurred in
conjunction with the Tyler refinery acquisition. These increases
were partially offset by higher interest income due to higher
cash balances and by recording a $1.0&nbsp;million increase in
unrealized gains on interest rate derivative instruments for the
nine months ended September&nbsp;30, 2005, compared to an
unrealized loss of $0.9&nbsp;million for the nine months ended
September&nbsp;30, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We also wrote-off deferred financing charges of
$3.5&nbsp;million in 2005 associated with the refinancing of a
portion of our long-term debt.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the nine months ended September&nbsp;30, 2005, we recorded a
$0.3&nbsp;million expense in connection with guarantee fees
payable to Delek Group Ltd. relating to the guaranty of a
portion of our debt incurred in connection with the acquisition
of the Tyler refinery.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Income Tax Expense</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income tax expense was $22.4&nbsp;million for the nine months
ended September&nbsp;30, 2005, compared to $2.9&nbsp;million for
the nine months ended September&nbsp;30, 2004, an increase of
$19.5&nbsp;million. This increase resulted from our higher
taxable income in 2005 compared to 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Additionally, in connection with our acquisition of the Tyler
refinery, our consolidated effective tax rate decreased.
Substantially all of our refinery operations are conducted
through a Texas limited partnership, which is not subject to
Texas franchise tax. The limited partnership&#146;s 0.1% general
partner was subject to Texas franchise tax on its 0.1% share of
refining operations. Accordingly, the effective tax rate
applicable to our refining operations is the federal tax rate
plus a nominal amount of state franchise tax. Consequently, our
consolidated effective tax rate was reduced by our
refinery&#146;s proportionate contribution to our consolidated
pretax earnings. Our effective tax rate was 36.0% for the nine
months ended September&nbsp;30, 2005, compared to 37.7% for the
first nine months of 2004.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">60

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Year Ended December&nbsp;31, 2004 Compared to Year Ended
    December&nbsp;31, 2003</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the years ended December&nbsp;31, 2004 and 2003, our
results include only our retail segment.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Net Sales</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net sales were $857.9&nbsp;million for 2004, compared to
$600.2&nbsp;million for 2003, an increase of $257.7&nbsp;million
or 42.9%. The increase in net sales was primarily due to
$160.3&nbsp;million in net sales from the purchase of the
Williamson Oil stores and an increase of 21.1% in average retail
fuel prices. Average retail fuel prices were $1.78&nbsp;per
gallon for 2004, compared to average retail fuel prices of
$1.47&nbsp;per gallon for 2003. Merchandise sales were
$54.2&nbsp;million higher in 2004 primarily due to the
$42.0&nbsp;million in net sales resulting from the Williamson
Oil acquisition and lottery revenues of $3.8&nbsp;million, an
increase of $3.4&nbsp;million, primarily due to the introduction
of the Tennessee lottery in early 2004.
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <I>Fuel Sales and Gallons.</I> Retail fuel sales were
    315.3&nbsp;million gallons for 2004, compared to
    267.5&nbsp;million gallons for 2003, an increase of
    47.8&nbsp;million gallons. This increase was primarily due to
    44.9&nbsp;million in gallons sold as a result of the acquisition
    of the Williamson Oil stores. Comparable store gallons decreased
    0.6%. Total fuel sales, including wholesale gallons, were
    $596.6&nbsp;million for 2004, compared to $393.2&nbsp;million
    for 2003, an increase of $203.4&nbsp;million or 51.7%. The
    increase was primarily due to an increase of $0.31 per gallon in
    the average retail price per gallon ($1.78&nbsp;per gallon
    compared to $1.47&nbsp;per gallon) and $118.3&nbsp;million in
    sales resulting from the acquisition of the Williamson Oil
    stores.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <I>Merchandise Sales.</I> Merchandise sales were
    $261.2&nbsp;million for 2004, compared to $207.0&nbsp;million
    for 2003, an increase of $54.2&nbsp;million or 26.2%. The
    primary reason for the increase in merchandise sales was
    $41.9&nbsp;million from the Williamson Oil acquisition and an
    increase of $3.4&nbsp;million in lottery commissions due to the
    introduction of the Tennessee lottery in early 2004. Comparable
    store merchandise sales increased 4.1%.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cost of Goods Sold</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cost of goods sold was $730.8&nbsp;million for 2004, compared to
$500.2&nbsp;million for 2003, an increase of $230.6&nbsp;million
or 46.1%. This increase was primarily due to $140.5&nbsp;million
in cost of goods sold from the purchase of the Williamson Oil
stores and an increase of 23.5% in average retail fuel costs.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fuel cost of goods sold was $546.4&nbsp;million in 2004,
compared to $352.1 in 2003 due to a 23.5% increase in retail
fuel costs and a 67.9&nbsp;million increase in gallons sold,
primarily due to the Williamson Oil acquisition. Merchandise
cost of goods sold was $184.3&nbsp;million in 2004, compared to
$148,1&nbsp;million in 2003, an increase of $36.2&nbsp;million
or 24.4%. The increase in merchandise cost of goods sold was
primarily due to $29.9&nbsp;million in cost of goods sold from
the Williamson Oil acquisition.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Operating Expenses</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Operating expenses were $80.1&nbsp;million for 2004, compared to
$62.7&nbsp;million for 2003, an increase of $17.4&nbsp;million
or 27.8%. This increase was primarily attributable to
$12.3&nbsp;million in direct operating expenses associated with
the purchase of the Williamson Oil stores and higher credit card
fees associated with the higher retail price of gasoline.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>General and Administrative Expenses</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
General and administrative expenses were $15.1&nbsp;million for
2004, compared to $12.9&nbsp;million for 2003, an increase of
$2.2&nbsp;million or 17.1%. This increase was primarily due to
increased salaries and related expenses associated with the
addition of the Williamson Oil stores and higher insurance and
travel costs.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">61

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Depreciation and Amortization</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization were $12.4&nbsp;million for 2004,
compared to $8.8&nbsp;million for 2003, an increase of
$3.6&nbsp;million or 40.9%. This increase resulted from
additions to property, plant and equipment as a result of
capital expenditures in 2004 and $2.3&nbsp;million of
depreciation and amortization associated with assets purchased
in the Williamson Oil acquisition.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>(Gain) on Disposal of Assets</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During 2004, we recognized a gain of $0.9&nbsp;million
associated with a gain on the sale of one convenience store and
disposal of various operational assets, compared to a gain of
$0.4&nbsp;million on the sale of various operational assets in
2003.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Interest Expense, Net, Interest Expense-Related Party,
    Write-off of Deferred Financing Costs, (Gain) Loss on Derivative
    Instruments and Guarantee Fees</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest expense, net was $7.1&nbsp;million in 2004, compared to
$5.9&nbsp;million in 2003, an increase of $1.0&nbsp;million or
17.0%. This increase was primarily due to increased borrowings
as a result of the Williamson Oil acquisition. Interest expense
from related party notes payable was $1.2&nbsp;million in 2004
compared to $0.1&nbsp;million in 2003, an increase of
$1.1&nbsp;million due to related party borrowings related to the
Williamson Oil acquisition. In addition, we recorded a non-cash
interest charge of $0.7&nbsp;million in 2004 due to changes in
fair value of interest rate derivative instruments compared to a
$0.2&nbsp;million gain in 2003.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Income Tax Expense</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income tax expense was $4.1&nbsp;million in 2004, compared to
$3.8&nbsp;million in 2003, an increase of $0.3&nbsp;million or
7.9%. The increase in income tax expense was attributable to our
increased 2004 taxable income compared to 2003. Our effective
tax rate was 36.0% for 2004, as compared to 37.1% for 2003.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Year Ended December&nbsp;31, 2003 Compared to Year Ended
    December&nbsp;31, 2002</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the years ended December&nbsp;31, 2003 and 2002, our
results include only our retail segment.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Net Sales</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net sales were $600.2&nbsp;million for 2003, compared to
$549.6&nbsp;million for 2002, an increase of $50.6&nbsp;million
or 9.2%. This increase was primarily due to $38.4&nbsp;million
in net sales from the purchase of eight retail fuel and
convenience stores in two separate transactions in February and
April of 2003 and a 21.1% increase in average retail fuel
prices. Average retail fuel prices were $1.47&nbsp;per gallon
for 2003, compared to average retail fuel prices of
$1.29&nbsp;per gallon for 2002.
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <I>Fuel Sales and Gallons.</I> Fuel sales were
    $393.2&nbsp;million for 2003, compared to $345.1&nbsp;million
    for 2002, an increase of $48.1&nbsp;million or 13.9%. The
    increase was primarily due to an increase of $0.18 per gallon in
    the average retail price per gallon ($1.47&nbsp;per gallon
    compared to $1.29&nbsp;per gallon). Retail gallons were
    relatively unchanged in 2003 compared to 2002 at
    267.5&nbsp;million gallons for 2003, compared to
    267.4&nbsp;million gallons for 2002, with comparable store
    gallons decreasing 0.1%.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <I>Merchandise Sales.</I> Merchandise sales were
    $207.0&nbsp;million for 2003, compared to $204.5&nbsp;million
    for 2002, an increase of $2.5&nbsp;million or 1.2%. Comparable
    store merchandise sales dropped 3.1%, due to lower beer and
    cigarette sales.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cost of Goods Sold</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cost of goods sold was $500.2&nbsp;million for 2003, compared to
$460.3&nbsp;million for 2002, an increase of $39.9&nbsp;million
or 8.7%. This increase was primarily due to a $32.4&nbsp;million
increase in cost of goods sold from the purchase of eight retail
fuel and convenience stores in two separate transactions in
February and April of 2003, and increases in average fuel costs
at these stores.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">62

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fuel cost of goods sold was $352.1&nbsp;million in 2003,
compared to $310.5&nbsp;million in 2002 due to a 13.4% increase
in retail fuel costs. Gallons sold were virtually unchanged
compared with 2002. Merchandise cost of goods sold was
$148.1&nbsp;million in 2003, compared to $149.9&nbsp;million in
2002. The increase in merchandise costs of goods sold was
primarily due to $6.2&nbsp;million in cost of goods sold from
the foregoing purchase of eight retail fuel and convenience
stores, offset by lower cost of goods sold due to lower beer and
cigarette sales.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Operating Expenses</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Operating expenses were $62.7&nbsp;million in 2003, compared to
$62.1&nbsp;million in 2002, an increase of $0.6&nbsp;million or
1.0%. This change was primarily attributable to
$3.6&nbsp;million increase in the operating expenses resulting
from the purchase of eight retail fuel and convenience stores in
two separate transactions in February and April of 2003, offset
by decreases of approximately $2.8&nbsp;million in advertising,
salaries and outside services expenses.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>General and Administrative Expenses</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
General and administrative expenses were $12.9&nbsp;million for
2003, compared to $12.2&nbsp;million in 2002, an increase of
$0.7&nbsp;million or 5.7%. This increase was primarily
attributable to higher salaries and professional expenses and
$0.2&nbsp;million in general and administrative expenses from
the purchase of the eight retail fuel and convenience stores
described above.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Depreciation and Amortization</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization were $8.8&nbsp;million for 2003,
compared to $7.4&nbsp;million for 2002, an increase of
$1.4&nbsp;million or 18.9%. This increase was primarily the
result of additional depreciation resulting from the increase in
property, plant and equipment related to our purchase of the
eight retail fuel and convenience stores described above.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>(Gain) on Disposal of Assets</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During 2003, we recognized a gain of $0.4&nbsp;million on the
sale of various operational assets. There were no gains on
disposal of assets in 2002.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Interest Expense, Net, Interest Expense-Related Party,
    Write-off of Deferred Financing Costs, (Gain) Loss on Derivative
    Instruments and Guarantee Fees</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest expense, net was $5.9&nbsp;million in 2003, compared to
$5.7&nbsp;million in 2002, an increase of $0.2&nbsp;million or
3.5%. Interest expense from related party notes payable was
$0.1&nbsp;million in 2003 compared to zero in 2002. We also
recognized a $0.2&nbsp;million gain on derivative instruments in
2003, compared to a $2.6&nbsp;million loss on derivative
instruments in 2002.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Income Tax Expense</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income tax expense was $3.8&nbsp;million in 2003, compared to an
income tax benefit of $0.3&nbsp;million in 2002, a change of
$4.1&nbsp;million. The change in income tax expense was
attributable to our generating 2003 taxable income compared to
our incurring a loss in 2002. Our effective tax rate was 37.1%
for 2003, compared to 35.8% for 2002.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Liquidity and Capital Resources</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our primary sources of liquidity are cash generated from our
operating activities and borrowings under our revolving credit
facilities and from related parties. We believe that our cash
flows from operations, borrowings under our revolving credit
facilities, proceeds from this offering and other capital
resources will be sufficient to satisfy the anticipated cash
requirements associated with our existing operations during the
next 12&nbsp;months. However, our future capital expenditures
and other cash requirements could be higher than
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">63

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
we currently expect as a result of various factors, including
any expansion of our business that we may complete. See
&#147;Risk Factors.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cash Flows</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth a summary of our consolidated
cash flows for the years ended December&nbsp;31, 2002, 2003 and
2004 and the nine months ended September&nbsp;30, 2004 and 2005:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="45%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>17,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>26,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,926</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>16,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>139,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,066</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(16,149</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(27,343</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(26,763</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(83,588</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash flows provided by (used in) financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,465</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,616</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,962</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,279</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (decrease) increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>7,942</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,199</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,417</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>124,921</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cash Flows Provided By (Used In) Operating Activities</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash provided by operating activities was
$139.2&nbsp;million for the nine months ended September&nbsp;30,
2005, compared to $16.2&nbsp;million for the nine months ended
September&nbsp;30, 2004. The most significant sources of cash
from operating activities in the first nine months of 2005 were
our increased net income from the Tyler refinery and increased
accounts payable due to crude oil purchases for our refinery,
partially offset by increases in accounts receivable.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash provided by operating activities was $24.9&nbsp;million
for 2004, compared to net cash provided by operating activities
of $26.3&nbsp;million for 2003. Operating cash flows for 2004
were primarily attributable to net income of $7.3&nbsp;million,
and increases in accounts payable due to higher retail fuel
costs.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash provided by operating activities was $26.3&nbsp;million
for 2003, compared to $17.5&nbsp;million for 2002. Operating
cash flows for 2003 were primarily attributable to net income of
$6.5&nbsp;million and an increase in accounts payable due to
higher retail fuel costs. Operating cash flows for 2002 were
primarily attributable to increases in accounts payable and
interest payable, partially offset by an increase in inventories
and accounts receivable.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cash Flows Provided By (Used In) Investing Activities</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash used in investing activities was $83.6&nbsp;million for
the nine months ended September&nbsp;30, 2005, compared to
$26.8&nbsp;million for the nine months ended September&nbsp;30,
2004. This difference was primarily due to the purchase of the
assets of the Tyler refinery for approximately
$73.1&nbsp;million (including transaction costs) and capital
expenditures of $8.4&nbsp;million, partially offset by proceeds
from the sale of retail fuel and convenience store assets of
$3.1&nbsp;million. Capital expenditures in the nine months ended
September&nbsp;30, 2005 included $3.2&nbsp;million for projects
at the Tyler refinery, with the remaining capital spent in our
retail fuel and convenience stores for improvements, equipment,
new store development and information technology.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash used in investing activities increased to
$27.3&nbsp;million in 2004 from $16.1&nbsp;million during 2003.
Our primary investments in 2004 included $22.2&nbsp;million for
the cash portion of the purchase price (including transaction
costs) for the Williamson Oil stores. Capital expenditures for
2004 totaled $7.0&nbsp;million spent in our retail fuel and
convenience stores for improvements, equipment, new store
development and information technology. These expenditures were
partially offset by $1.8&nbsp;million in proceeds received from
retail fuel and convenience store asset disposals.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">64

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash used in investing activities increased to
$16.1&nbsp;million in 2003 from $12.1&nbsp;million during 2002.
Our primary investments in 2003 included $12.2&nbsp;million for
the purchase of retail fuel and convenience store assets and
capital expenditures of $5.2&nbsp;million. These expenditures
were partially offset by $1.2&nbsp;million in proceeds received
from retail fuel and convenience store asset disposals.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cash Flows Provided By (Used In) Financing Activities</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash provided by financing activities was $69.3&nbsp;million
during the nine months ended September&nbsp;30, 2005, compared
to $14.0&nbsp;million during the nine months ended
September&nbsp;30, 2004. Cash provided from financing activities
included net proceeds received as a result of refinancing term
and revolver borrowings of $40.0&nbsp;million through a
revolving credit facility and a $165.0&nbsp;million term loan,
as well as $50.0&nbsp;million in proceeds received from notes
issued in connection with the Tyler refinery purchase. Cash
provided by financing activities in 2005 also reflected a
subordinated loan of $35.0&nbsp;million received from Delek
Group Ltd. Cash used in financing activities included
$13.8&nbsp;million of financing costs paid in connection with
new debt issuance, debt repayments of $174.1&nbsp;million and
payments made under capital lease obligations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash provided by financing activities was $5.6&nbsp;million
in 2004, compared to net cash used in financing activities of
$2.2&nbsp;million in 2003. The cash provided was primarily
attributable to additional borrowings used to finance the
Williamson Oil acquisition, partially offset by the payment of
additional financing costs and the purchase of interest rate
derivatives. Cash provided included borrowings made under a new
$34.5&nbsp;million term loan facility, a $6.0&nbsp;million
revolving line of credit and a subordinated loan of
$25.0&nbsp;million received from Delek&nbsp;- The Israel Fuel
Corporation Ltd., most of which were used to finance a portion
of the Williamson Oil acquisition.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net cash used in financing activities was $2.2&nbsp;million in
2003, compared to $4.5&nbsp;million in 2002. The use of cash in
2003 reflected the reduction in our net borrowings under a term
loan and an increase in restricted cash, the majority of which
was to be used to acquire replacement assets. Cash provided by
financing activities in 2003 reflected an increase in our net
borrowings under a new term loan used to partially finance a
portion of the purchase of eight retail fuel and convenience
stores.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Cash Position, Working Capital and Indebtedness</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of September&nbsp;30, 2005, our total cash and cash
equivalents were $147.0&nbsp;million and we had total
indebtedness of approximately $282.7&nbsp;million. Working
capital was $108.6&nbsp;million at September&nbsp;30, 2005,
compared to $(8.7)&nbsp;million at December&nbsp;31, 2004, an
increase of $117.3&nbsp;million. This increase was primarily due
to $86.8&nbsp;million in net working capital from our Tyler
refinery operations, including $121.1&nbsp;million of cash and a
$21.7&nbsp;million reduction in current maturities of long-term
debt due to the refinancing of certain debt obligations
completed in April 2005.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">65

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Summary of Indebtedness.</I> Outstanding borrowings under our
existing debt instruments and capital lease obligations at
September&nbsp;30, 2005 were as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="71%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>(Dollars in</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Senior secured credit facility&nbsp;&#151; term loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>164,588</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Senior secured credit facility&nbsp;&#151; revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Israel Discount Bank note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Bank Leumi note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,650</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(46</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>280,982</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Notes&nbsp;Payable to Related Parties.</I> On April&nbsp;28,
2004, we signed a note payable to Delek&nbsp;&#150; The Israel
Fuel Corporation Ltd. in the principal amount of
$25.0&nbsp;million. Proceeds from the note were used to
partially fund the purchase of the Williamson Oil stores. The
note bears interest at a rate of 6.30%&nbsp;per year with
interest and principal payments due upon maturity on
April&nbsp;27, 2008.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, to partially finance our purchase of our
refinery, we signed a note payable to Delek Group Ltd. in the
principal amount of $35.0&nbsp;million. The note bears interest
at a rate of 7.0%&nbsp;per year, which is due and payable in
semi-annual installments, commencing July&nbsp;1, 2007. The
entire principal amount plus accrued and unpaid interest is due
upon maturity on April&nbsp;27, 2010. On November&nbsp;23, 2005,
we repaid $17.5&nbsp;million of the principal and all accrued
interest through that date under the note.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Senior Secured Credit Facility.</I> On April&nbsp;28, 2005,
we executed our senior secured credit facility with a syndicate
of lenders and Lehman Commercial Paper Inc., an affiliate of
Lehman Brothers Inc., one of the underwriters of this offering,
serving as administrative agent. In connection with the
execution of the amended and restated agreement, we consolidated
certain of our borrowings under our existing credit agreement
and asset-backed loan agreement into a single credit facility
and increased the borrowing capacity available under the
facility to $205.0&nbsp;million.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The senior secured credit facility consists of a
$40.0&nbsp;million revolving credit facility and a
$165.0&nbsp;million term loan. Borrowings under the senior
secured credit facility are secured by substantially all the
assets of MAPCO Express, Inc. and its subsidiaries. Letters of
credit outstanding under the facility totaled $7.9&nbsp;million
as of September&nbsp;30, 2005. In December 2005, we increased
commitments under our senior secured credit facility revolver by
$30.0&nbsp;million to $70.0&nbsp;million, and subsequently
borrowed $30.0&nbsp;million in connection with our acquisition
of retail fuel and convenience stores and other assets from BP.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The senior secured credit facility term loan requires quarterly
principal payments of approximately 0.25% of the principal
balance through March&nbsp;31, 2011 and a balloon payment of
approximately 94.25% of the principal balance due upon maturity
on April&nbsp;28, 2011. The senior secured credit facility
revolver is payable in full upon maturity on April&nbsp;28, 2010
with periodic interest repayment requirements. The senior
secured credit facility term and senior secured credit facility
revolver loans bear interest based on predetermined pricing
grids which allow us to choose between a &#147;Base Rate&#148;
or &#147;Eurodollar&#148; loan. Interest is payable quarterly
for Base Rate loans and for the applicable interest period on
Eurodollar loans. As of September&nbsp;30, 2005, the weighted
average borrowing rate was 6.7% for the senior secured credit
facility term loan and 6.4% for the senior secured credit
facility revolver. Additionally, the senior secured credit
facility requires us to pay a quarterly fee of 0.5%&nbsp;per
year on the average available revolving commitment. Amounts
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">66

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
available under the senior secured credit facility revolver as
of September&nbsp;30, 2005 totaled approximately
$24.1&nbsp;million.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are required to comply with certain financial and
non-financial covenants under the senior secured credit
facility. We believe we were in compliance with all covenant
requirements at September&nbsp;30, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>SunTrust ABL Revolver.</I> On April&nbsp;29, 2005, we entered
into a $250.0&nbsp;million asset-based senior revolving credit
facility with a syndicate of lenders led by SunTrust Bank as
administrative agent to finance ongoing working capital, capital
expenditures and general needs of the Tyler refinery. This
agreement, as amended on May&nbsp;2, 2005 and as of
October&nbsp;1, 2005, which we refer to as the SunTrust ABL
revolver, matures on April&nbsp;29, 2009 and bears interest
based on predetermined pricing grids that allow us to choose
between a &#147;Base Rate&#148; or &#147;Eurodollar&#148; loan.
Interest is payable quarterly for Base Rate loans and for the
applicable interest period on Eurodollar loans. Availability
under the SunTrust ABL revolver is determined by a borrowing
base defined in the SunTrust ABL revolver, supported primarily
by cash, certain accounts receivable and inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the SunTrust ABL revolver supports our issuances of
letters of credit used primarily in connection with the
purchases of crude oil for use in our refinery that at no time
may exceed the aggregate borrowing capacity available under the
SunTrust ABL revolver. As of September&nbsp;30, 2005, we had no
outstanding borrowings under the agreement but had letters of
credit outstanding totaling approximately $178.0&nbsp;million.
Amounts available under the SunTrust ABL revolver as of
September&nbsp;30, 2005 totaled $72.0&nbsp;million.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The SunTrust ABL revolver contains a negative covenant that
prohibits us from creating, incurring or assuming any liens,
mortgages, pledges, security interests or other similar
arrangements against the property, plant and equipment of the
refinery, subject to customary exceptions for certain permitted
liens.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under the SunTrust ABL revolver, we are also subject to certain
other financial and non-financial covenants. We believe we were
in compliance with all covenant requirements at
September&nbsp;30, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Israel Discount Bank Note.</I> On April&nbsp;26, 2005, we
signed a $30.0&nbsp;million promissory note payable to Israel
Discount Bank of New York. The proceeds of this note were used
to partially fund a portion of the Tyler refinery acquisition.
This note matures on April&nbsp;30, 2007, and bears interest,
payable quarterly, at a spread of 1.375%&nbsp;per year over the
<FONT style="white-space: nowrap">90-day</FONT> London Inter
Bank Offering Rate, or LIBOR, with the first interest payment
due on April&nbsp;30, 2006. As of September&nbsp;30, 2005, the
weighted average borrowing rate on this note was 5.04%. This
note is guaranteed by Delek Group Ltd. See &#147;Certain
Relationships and Related Transactions&nbsp;&#151; Guarantees by
Affiliates.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Bank Leumi Note.</I> On April&nbsp;27, 2005, we signed a
$20.0&nbsp;million promissory note payable to Bank Leumi USA.
The proceeds of this note were used to partially fund a portion
of the Tyler refinery acquisition. This note matures on
April&nbsp;27, 2007, and bears interest at a spread of
1.375%&nbsp;per year over the LIBOR Rate (Reserve Adjusted) for
a three month term, with the first interest payment due in April
2006. As of September&nbsp;30, 2005, the weighted average
borrowing rate on this note was 5.06%. This note is guaranteed
by Delek Group Ltd. See &#147;Certain Relationships and Related
Transactions&nbsp;&#151; Guarantees by Affiliates.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Letters of Credit.</I> As of September&nbsp;30, 2005, in
addition to letters of credit totaling $185.9&nbsp;million
outstanding under the SunTrust ABL revolver and senior secured
credit facility revolver mentioned above, we had letters of
credit for fuel purchases totaling $9.5&nbsp;million issued in
our favor by Delek&nbsp;&#150; The Israel Fuel Corporation Ltd.
See &#147;Certain Relationships and Related
Transactions&nbsp;&#151; Guarantees by Affiliates.&#148;
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">67

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Capital Spending</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our capital expenditures for the nine months ended
September&nbsp;30, 2005 were approximately $8.4&nbsp;million, of
which approximately $5.2&nbsp;million was spent in our retail
segment, and approximately $3.2&nbsp;million was spent in our
refining segment. Our capital expenditure budgets for 2006 and
2007 are approximately $77.4&nbsp;million and
$58.2&nbsp;million, respectively. The following table summarizes
our expected capital expenditures for 2006 and 2007 by operating
segment and major category.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2006</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2007</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sustaining maintenance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,175</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Growth/profit improvement</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,658</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retrofit/rebrand/remodel</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,025</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Raze and rebuild</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,700</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    New construction</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total retail</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31,563</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,058</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="10">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    Refining:</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sustaining maintenance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,716</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,470</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Environmental (see explanation below)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,445</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,235</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Turnarounds</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Discretionary projects</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,641</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,400</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total refinery</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>45,802</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,105</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total capital spending</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>77,365</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>58,163</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Environmental Capital Expenditures.</I> We expect to spend
approximately $26.7&nbsp;million between 2006 and the end of
2007 to comply with the federal Clean Air Act regulations
requiring a reduction in sulfur content in gasoline and diesel
fuel. In addition, we expect to spend approximately
$14.3&nbsp;million for other environmental projects through
2010, including approximately $6.7&nbsp;million for purchasing
and installing a sulfur recovery unit and approximately
$3.0&nbsp;million for a new electrical substation to comply with
a proposed consent decree with the U.S.&nbsp;Department of
Justice and the EPA. The estimated environmental capital
expenditures described above are summarized in the table below.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="46%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2006</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2009</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2010</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Total</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Low-sulfur gasoline</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$9,485</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>11,985</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Low-sulfur diesel</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,668</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,668</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Electrical substation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,964</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,964</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sulfur recovery unit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,650</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,650</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other environmental</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,663</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,663</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Totals</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28,445</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>10,235</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>40,930</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Turnarounds.</I> Our refinery&#146;s prior owner completed a
turnaround in February 2005. We completed a supplementary
turnaround in December 2005 that involved the fluid catalytic
cracking unit, sulfuric acid alkylation unit, sulfur recovery
unit and treating units at a cost of approximately
$10.0&nbsp;million. No further major turnarounds are planned
until 2009, with the costs of these future turnarounds estimated
to be approximately $20.0&nbsp;million.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">68

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Contractual Obligations and Commitments</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Information regarding our known contractual obligations of the
types described below as of September&nbsp;30, 2005, is set
forth in the following table. We did not have any capital lease
obligations as of September&nbsp;30, 2005.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="33%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>&#60;1&nbsp;Year</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>1-3&nbsp;Years</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>3-5&nbsp;Years</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>&#62;5&nbsp;Years</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Total</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="19" align="center" nowrap><B>(Dollars in thousands)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,696</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$78,344</TD>
    <TD align="left" valign="bottom" nowrap>(1)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>46,300</TD>
    <TD align="left" valign="bottom" nowrap>(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>156,338</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,227</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24,237</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,782</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,142</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>66,388</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating lease obligations(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,274</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26,046</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,534</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>89,932</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>150,786</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>25,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>128,627</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>93,616</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>252,412</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>499,852</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Does not reflect $20.0&nbsp;million in principal prepayments
    made to Bank Leumi USA and Israel Discount Bank on
    November&nbsp;23, 2005.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Does not reflect $17.5&nbsp;million in principal prepayments
    made to Delek Group Ltd. on November&nbsp;23, 2005 and
    $30.0&nbsp;million in borrowings used to fund our acquisition of
    retail fuel and convenience stores and other assets from BP in
    December 2005.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    Includes expected payments on credit facilities in place at
    September&nbsp;30, 2005. Variable interest is set at
    September&nbsp;30, 2005 rates.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    Amounts reflect future estimated lease payments, including
    renewal options for leases we have determined are reasonably
    assured, under operating leases having remaining noncancelable
    terms in excess of one year as of September&nbsp;30, 2005.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Off-Balance Sheet Arrangements</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have no off-balance sheet arrangements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Quantitative and Qualitative Disclosure About Market Risk</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Changes in commodity prices (mainly crude oil and gasoline) and
interest rates are our main sources of market risk. We manage
these risks based on the assessment of our management.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Commodity Price Risk.</I> Sudden change in petroleum prices
is our main source of market risk. Our business model is
affected more by the volatility of petroleum prices than by the
cost of the petroleum that we sell. We manage these risks based
on the assessment of our management and we use hedging
strategies from time to time.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to manage the uncertainty relating to inventory price
volatility, we have consistently applied a policy of maintaining
inventories at or below a targeted operating level. In the past,
circumstances have occurred, such as timing of crude oil cargo
deliveries, turnaround schedules or shifts in market demand that
have resulted in variances between our actual inventory level
and our desired target level. We may utilize the commodity
futures market to manage these anticipated inventory variances.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;133, all commodity futures
contracts are recorded at fair value, and any change in fair
value between periods has historically been recorded in the
profit and loss section of our consolidated financial statements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are exposed to market risks related to the volatility of
crude oil and refined petroleum product prices, as well as
volatility in the price of natural gas used in our refinery
operations. Our financial results can be affected significantly
by fluctuations in these prices, which depend on many factors,
including demand for crude oil, gasoline and other refined
petroleum products, changes in the economy, worldwide production
levels, worldwide inventory levels and governmental regulatory
initiatives. Our risk management strategy identifies
circumstances in which we may utilize the commodity futures
market to manage risk associated with these price fluctuations.
At September&nbsp;30, 2005, we had open contracts covering a
portion of our
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">69

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
September and October 2005 production of unleaded gasoline
(approximately 0.7&nbsp;million barrels). We recorded unrealized
losses of $10.9&nbsp;million during the nine month period ended
September&nbsp;30, 2005, in conjunction with these contracts.
These contracts, which have expired, were entered into with an
affiliate of Citigroup Global Markets Inc., one of the
underwriters of this offering.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We maintain at our refinery and in third-party facilities
inventories of crude oil, feedstocks and refined petroleum
products, the values of which are subject to wide fluctuations
in market prices driven by world economic conditions, regional
and global inventory levels and seasonal conditions. As of
September&nbsp;30, 2005, we held approximately 1.0&nbsp;million
barrels of crude and product inventories valued under the LIFO
valuation method with an average cost of $54.40&nbsp;per barrel.
Market value exceeded carrying value of LIFO costs by
$27.3&nbsp;million. We refer to this excess as our LIFO reserve.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Interest Rate Risk.</I> We have market exposure to changes in
interest rates relating to our outstanding variable rate
borrowings, which totaled $222.6&nbsp;million as of
September&nbsp;30, 2005. We help manage this risk through a
combination of interest rate swap and cap agreements that modify
the interest characteristics of our outstanding long-term debt.
In accordance with SFAS&nbsp;No.&nbsp;133, all interest rate
hedging instruments are recorded at fair value and any changes
in the fair value between periods are recognized in earnings.
The fair value of our interest rate hedging instruments
increased by $1.0&nbsp;million for the nine months ended
September&nbsp;30, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The fair values of our interest rate swaps and cap agreements
are obtained from dealer quotes. These values represent the
estimated amount that we would receive or pay to terminate the
agreement taking into account the difference between the
contract rate of interest and rates currently quoted for
agreements, of similar terms and maturities. We expect the
interest rate derivatives will reduce our exposure to short-term
interest rate movements. The annualized impact of a hypothetical
1% change in interest rates on floating rate debt outstanding as
of September&nbsp;30, 2005 would be to change interest expense
by $2.2&nbsp;million. Increases in rates would be partially
mitigated by interest rate derivatives mentioned above. As of
September&nbsp;30, 2005, we had $3.2&nbsp;million of swap
agreements in place, which expired in January 2006. The weighted
average pay rate under these swaps was 5.15%. We also have
interest rate cap agreements in place representing
$135.0&nbsp;million in notional value at September&nbsp;30, 2005
with various settlement dates, the latest of which expires in
July 2010. These interest rate caps range from 3.50% to 4.00%
and include a knock-out feature at rates ranging from 6.50% to
7.15%. The fair value of our interest rate derivatives was
$2.9&nbsp;million as of September&nbsp;30, 2005.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">70

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='111'></A>
</DIV>

<!-- link1 "OUR INDUSTRY" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>OUR INDUSTRY</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Refining Industry Overview</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Oil refining is the process of separating hydrocarbon compounds
present in crude oil and converting them into refined petroleum
products, such as gasoline and diesel fuel. Refining is
primarily a margin-based business where both the feedstocks and
refined petroleum products are commodities. Refiners create
value by selling refined petroleum products at prices higher
than the costs of acquiring crude oil and converting it into
refined petroleum products.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The U.S.&nbsp;oil refining industry has undergone significant
consolidation in the past ten years. The corporate
mergers/acquisitions of integrated majors such as BP Arco and
Amoco, Exxon and Mobil, Phillips with both Tosco and Conoco and
Chevron and Texaco are examples of the consolidation that has
occurred. Additionally, the emergence of independent refiners as
consolidators such as Valero, which owned only one refinery in
1994 and now owns 17 U.S.&nbsp;refineries, has contributed to
the trend. In 1994, the ten largest refiners, by capacity, owned
approximately half of the total refining capacity in the United
States. By 2004, the top ten U.S.&nbsp;refiners, by capacity,
owned approximately 71% of total refining capacity.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The differential in price between a representative barrel of
benchmark refined petroleum products, such as gasoline or
heating oil, and a barrel of benchmark crude oil is known as a
crack spread. The US Gulf Coast 5-3-2 crack spread represents
the differential between Platt&#146;s quotations for
<FONT style="font-size: 70%"><SUP>3</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
of a barrel of US Gulf Coast Pipeline 87 Octane Conventional
Gasoline and
<FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
of a barrel of US Gulf Coast Pipeline No.&nbsp;2 Heating Oil
(high sulfur diesel), on the one hand, and the first month
futures price of
<FONT style="font-size: 70%"><SUP>5</SUP></FONT>/<FONT style="font-size: 60%">5</FONT>
of a barrel of light sweet crude oil on the New York Mercantile
Exchange, on the other hand.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following chart shows the one-year average together with the
rolling five-year average of the US Gulf Coast 5-3-2 crack
spreads since 1996:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="g99350g9935005.gif" alt="(HISTORICAL US GULF COAST 5-3-2 CRACK SPREADS)">
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Strong Demand for Refined Petroleum Products</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
According to the Department of Energy&#146;s Energy Information
Administration, or EIA, total U.S.&nbsp;demand for refined
petroleum products increased 2.4% from 2003 to 2004, due
primarily to an improving economy
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">71

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
and a continued increase in the number of higher gasoline
consumption vehicles driven by U.S.&nbsp;consumers. At the same
time, gasoline supplies have tightened due to more stringent
fuel specifications. These factors have caused refining margins
in 2004 and 2005 to substantially exceed those experienced in
2003.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Growth in refining capacity is expected to
average&nbsp;1.3%&nbsp;per year over the next two decades
according to the EIA. The EIA projects demand for refined
petroleum products to continue to grow at an average of
1.5%&nbsp;per year over this period and to outpace capacity
growth. Approximately 92% of the projected demand growth is
expected to come from the increased consumption of light
petroleum products, including gasoline, diesel, jet fuel and
liquified petroleum gas, which are more difficult and costly to
produce than heavy petroleum products.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Limited U.S.&nbsp;Refining Capacity</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
According to the EIA, the number of operable
U.S.&nbsp;refineries has decreased from 319 in 1980 to 148 in
2005. Also according to the EIA, while domestic refining
capacity has decreased approximately 6%, from 6.6&nbsp;billion
barrels per year in 1980 to 6.2&nbsp;billion barrels per year in
2005, domestic demand for refined fuels has increased 27.1%,
from 5.9&nbsp;billion barrels to 7.5&nbsp;billion barrels, over
the same period.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Petroleum refining is subject to extensive environmental
regulation in the United States. No new refinery has been
constructed in the United States since 1976. We believe that
high capital costs and environmental regulatory requirements
have limited the growth of refining capacity, the construction
of new refineries and the expansion of existing refineries in
the United States over the past 30&nbsp;years. Domestic
refineries are subject to several major federal environmental
programs, including those administered under the Resource
Conservation and Recovery Act, the Clean Air Act and the Clean
Water Act. Additionally, new fuel specification requirements
(such as the Tier&nbsp;II (low sulfur) gasoline, on-road
ultra-low sulfur diesel, non-road locomotive and marine
ultra-low sulfur diesel, methyl tertiary butyl ether, or MTBE,
phase-out and ethanol mandates) and New Source Review revisions
will require refining companies to continue to make substantial
capital investments in domestic refineries over the next five
years and beyond.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>High Utilization Rates</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Between 1982 and 2004, refinery utilization increased from 69%
to over 92%. The EIA projects that utilization will remain high
relative to historic levels, ranging from 92% to 95% of design
capacity. The trend toward greater capacity utilization has been
driven by several factors, including those discussed above.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">72

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following chart displays the number of operable refineries
in the United States, historically compared to the average
utilization rate in the industry.
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<IMG src="g99350g9935006.gif" alt="(REFINERY UTILIZATION RATES)">
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Significant Dependence on Imports</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Due to the lack of sufficient domestic refining capacity, the
United States is a net importer of refined petroleum products.
Imports accounted for almost 14% of total U.S.&nbsp;consumption
of refined petroleum products in 2004. Import volumes generally
increase when prices for refined petroleum products are
materially higher in the United States than in international
markets. In the future, imported refined petroleum products will
be required to meet new, more stringent fuel specifications
applicable to the U.S.&nbsp;market. Many foreign refiners do not
currently possess the capabilities to blend and process fuels
that meet these specifications, which could put further pressure
on the domestic supply and demand environment.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Varying Product Specifications Complicate
    Distribution</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Regulatory requirements for fuel specifications vary by city,
county, state and region. Due to these varying specification
requirements, disruptions in one region cannot necessarily be
alleviated by importing product from another region. For
example, a Houston, Texas refiner may have large batches of
gasoline prepared for shipment on the Colonial Pipeline to the
East Coast. If the Colonial Pipeline were to become
non-operational due to a hurricane in Louisiana or some other
event, the refinery may become backlogged because the
specifications of the gasoline in storage do not meet the local
specifications or those of other pipelines for shipment to other
areas of the United States.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The EPA will require production of ultra-low sulfur diesel fuel
beginning in June 2006. The introduction of ultra-low sulfur
diesel will further complicate fuel distribution, because extra
care must be taken in shipping ultra-low sulfur diesel to avoid
contamination. The introduction of new ultra-low sulfur diesel
is expected to result in short-term supply disruptions.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">73

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Vulnerability of Energy Infrastructure</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The major refining center in the United States is located in the
Gulf Coast region in an area classified by the federal
government as the Petroleum Administration for Defense District,
or PADD,&nbsp;III (Alabama, Arkansas, Louisiana, Mississippi,
New Mexico and Texas). The total refining capacity in
PADD&nbsp;III as of January&nbsp;1, 2006 is 8.3&nbsp;million
barrels per day, representing 49% of total U.S.&nbsp;refining
capacity. Normally, over 50% of the products refined in
PADD&nbsp;III are exported to other areas of the country through
an extensive network of pipelines, ships and barges. The primary
recipients of these shipments are in the East Coast PADD I
(Connecticut, Delaware, District of Columbia, Florida, Georgia,
Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New
York, North Carolina, Pennsylvania, Rhode Island, South
Carolina, Vermont, Virginia, and West Virginia) and the Midwest
PADD&nbsp;II (Illinois, Indiana, Iowa, Kansas, Kentucky,
Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio,
Oklahoma, South Dakota, Tennessee, Wisconsin). The geographic
concentration of refineries in PADD&nbsp;III makes the refining
and marketing infrastructure, and consequently the supply of
refined petroleum products to major consuming regions, more
vulnerable to natural disasters and concentrated terror attacks
on the U.S.&nbsp;Gulf Coast.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For example, when Hurricanes Rita and Katrina hit Texas and
Louisiana in September 2005, product exports from PADD&nbsp;III
dropped by almost one million bpd, or approximately 21%, due to
refinery shutdowns, pipeline shutdowns, power outages, shipping
disruptions, operating personnel dislocations and other factors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Convenience Store Industry Overview</B>
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>What is a convenience store</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The National Association of Convenience Stores, or NACS, defines
a convenience store as a retail business with a primary emphasis
placed on providing the public with a convenient location to
quickly purchase from a wide array of consumable products
(predominantly food or food and gasoline) and services.
Convenience stores have the following characteristics:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Building size may vary significantly&nbsp;&#151; typically
    between 1,000 and 5,000&nbsp;square feet;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Off-street parking and/or convenient pedestrian access;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Extended hours of operation with many open 24&nbsp;hours a day,
    seven days a week;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Stock of at least 500 SKUs (stock-keeping units);</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Product mix includes grocery-type items and items from the
    following groups: beverages, snacks (including confectionery)
    and tobacco;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Approximately 81% sell gasoline.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Industry Overview</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
According to NACS, the convenience store industry generated
$394.7&nbsp;billion in revenues and $4.9&nbsp;billion in income
before income taxes in 2004 compared to $337&nbsp;billion in
revenues and $4.0&nbsp;billion in income before income taxes in
2003. Total industry sales have grown at a
<FONT style="white-space: nowrap">5-year</FONT> compounded
annual growth rate, or CAGR, of 11.0%. In 2004, there were
approximately 138,000 convenience stores in the United States,
resulting in average revenues per site of $3.3&nbsp;million and
average gross margin per site of $448,507. The market is highly
fragmented, with the top 100 companies, ranked by sales,
accounting for only 32% of total industry sales.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The industry is comprised of two major categories of sales:
in-store sales and fuel sales. In-store sales consist of
cigarettes, beverages, food service, snacks and general
merchandise. Fuel sales consist primarily of gasoline, but also
include small percentages of diesel, propane and other refined
petroleum products.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">74

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Highly Fragmented Industry</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The convenience store industry continues to be dominated by
small, &#147;independent&#148; operators. According to the NACS,
approximately 66% of all convenience stores in the United States
are operated by companies that operate less than ten stores. A
substantial majority are single store operators. On the other
hand, stores operated by companies with 500 or more stores
accounted for only about 12% of all convenience stores.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>In-Store Sales</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In 2004, the convenience store industry derived approximately
<FONT style="white-space: nowrap">one-third</FONT> of total
sales from in-store merchandise, with the remainder coming from
fuel sales. However, in-store merchandise typically accounts for
a much higher portion of the total gross margin
dollars&nbsp;&#150; approximately 68%. Industry historical
percentage of in-store sales and gross margins for the top ten
in-store merchandise categories (excluding lottery) are listed
below:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="g99350g9935007.gif" alt="(Percentage of Sales and Gross Margins By Category)">
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cigarettes are the leading product category for convenience
store in-store sales, accounting for approximately 35% of
in-store sales in 2004. Convenience stores dominate the market
for cigarette sales, growing to approximately 62% of the market
in 2004, compared to approximately 54% in 1999.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The eight southeastern states in which we operate have some of
the highest smoking rates and lowest tax rates for cigarette
sales in the United States. As reflected in the table below,
five of these states (listed in bold)&nbsp;&#151; Kentucky,
Tennessee, Arkansas, Alabama and Mississippi&nbsp;&#151; are
within the top ten states in terms of percentage of population
that smokes. Five of the states&nbsp;&#151; Kentucky, Louisiana,
Mississippi, Tennessee and Virginia&nbsp;&#151; also have state
laws protecting the rights of smokers. In addition, as reflected
in the table below, five of the states&nbsp;&#151; Kentucky,
Louisiana, Mississippi, Tennessee and Virginia&nbsp;&#151; are
among the ten states with the lowest cigarette taxes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">75

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<IMG src="g99350g9935008.gif" alt="(Percentage of Sales and Gross Margins By Category">
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Non-alcoholic packaged beverages consist of carbonated soft
drinks, ready-to-drink iced teas, sports drinks, juice and juice
drinks, bottled water and alternative beverages. Growth in the
packaged beverages category was driven by alternative beverages,
sports drinks, ready-to-drink iced teas and bottled water. While
the percentage of in-store sales attributable to food service
declined between 2003 and 2004, the gross margin contribution of
food service was higher due to the increased percentage of food
prepared on site (from 42.3% to 46.6%) as well as an increase in
sales and margin in cold dispensed beverages.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Fuel Sales</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NACS estimates that convenience stores sell three-quarters of
all the gasoline purchased in the United States. Fuel sales as a
percentage of total industry sales have grown from approximately
61.4% in 2000 to 66.5% in 2004. The industry&#146;s motor fuels
sales jumped 18.9% to reach $262.6&nbsp;billion for a total of
143.5&nbsp;billion gallons in 2004. However, gasoline revenue is
a function of the retail price of gasoline, which can vary
widely without impacting the profitability of the convenience
store industry.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
According to the EIA, the United States consumed approximately
9.1&nbsp;million bpd (139.0&nbsp;billion gallons per year) of
gasoline in 2004. National gasoline demand growth has been
fairly steady over the past ten years and has grown at a CAGR of
1.7%. Over the past ten years, gasoline demand in the Southeast
has outpaced the national average, with demand having grown at a
CAGR of 2.2%.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Gross margins for a retail fuel outlet are typically expressed
in a
<FONT style="white-space: nowrap">&#147;rack-to</FONT>-retail&#148;
margin, which is the differential between the prices quoted at
refinery fueling stations, or racks, and the price sold to the
end consumer, net of gasoline sales taxes. The
<FONT style="white-space: nowrap">rack-to</FONT>-retail margin
averaged $0.147 per gallon in 2005. The following table displays
industry fuel margins in the southeast region of the United
States since 1996.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">76

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="g99350g9935009.gif" alt="(PERCENTAGE OF SALES AND GROSS MARGINS BY CATEGORY)">
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fuel margins in the states in which we operate have averaged
$0.119 per gallon over the last ten years and fell in a
normalized range of approximately $0.100 to $0.137 per gallon.
Due to world crude supply and demand fundamentals, domestic fuel
inventories and domestic refining capacity, 1999 was one of the
worst years in recent history for retail margins, with average
fuel margins in our core market 16.0% below the ten-year
average. The market recovered in 2000, with margins increasing
14.1% over 1999. Between 2000 and 2005, fuel margins in our
market have steadily improved, increasing 34.2%, with margins
averaging $0.153 per gallon in 2005.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Technology</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe that technology and scale are becoming increasingly
important competitive differentiators for convenience store
operators. In a recent study conducted by NACS, 24% of the
respondents indicated that IT spending as a percentage of total
capital spending was over 20% for their respective companies.
Given the highly fragmented nature of the industry, operators
with the capacity to invest in substantial technological
improvements are expected to gain an advantage over their
competitors. These developing technology platforms are most
likely to benefit larger operators since they are generally
better capitalized to make investments in technology.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Potential advantages from greater technology investment are
improved merchandising and promotional activity, increased
operating efficiency, more efficient inventory management, and
better, closer supplier relationships. New technology will help
to improve the speed and options of payment and reduce customer
wait times, which should enhance customer relations.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">77

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Recent Trends</I></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Food Service</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Increased work and travel demands have led American consumers to
eat out more often and to seek food service offerings that
conveniently provide fresher, higher quality foods. In 2004,
food service represented approximately 12% of in-store sales and
generated margins of 37% to 56%. Food service has been an
expanding category in the industry, with major convenience store
chains using the concept to build upon and improve the
profitability of the traditional convenience store layout.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To meet consumer demand and to diversify their product offerings
away from the volatility and margin pressure of gasoline sales
and heavy reliance on tobacco products, many convenience stores
are now introducing Quick Service Restaurants, or QSRs, into
their product offerings at many of their locations. The
restaurants are either incorporated within the convenience store
plan as a kiosk or co-located with a more traditional full-size
restaurant format.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The introduction of QSRs offers two advantages: QSRs draw
incremental customer traffic to the location with their
increased service offering, and they increase average sales with
higher gross margin products, resulting in higher productivity
and returns per site. Within the convenience store industry, the
introduction of QSRs remains in its early-stage, and we believe
that QSRs are likely to continue to grow in importance in
driving growth and change in the convenience store industry.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Increasing Competition</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In-store sales across the industry are under pressure from the
growth of mass-merchants, warehouse clubs, grocers and
drug-store retailers as they move into convenience consumables,
add more locations and offer extended hours. In addition,
mass-merchants and warehouse clubs, such as Wal-Mart and Costco,
now offer fueling stations at their existing locations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Energy Analysts International, Inc., or EAI, estimates that the
number of supermarkets offering fuel increased at an annualized
rate of 65% over three years, with the group now capturing
nearly 7.7% of the total market volume, up from 6.6% in 2003.
EAI estimates that supermarkets, discount stores and mass
merchandise/club store retailers operated 3,580 motor fuel
outlets in 2004. This store distribution poses a challenge to
traditional convenience store outlets because supermarkets are
often in locations of greater direct competition. Also, these
operators may price gasoline aggressively in order to attract
customer traffic in the hope of stimulating purchases in their
more profitable and primary retail categories.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NACS indicates that gross margins are much lower in regions with
significant presence of these new operators. Despite the rather
strong appreciation in the price of gasoline, the average gross
margin received by the convenience store retailers has remained
relatively stable. According to NACS, the average fuel margin
ranged from $0.127 to $0.137 per gallon between 2000 and 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="6%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>New Store Builds</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
According to NACS, retailers spent $203,000&nbsp;per remodeled
store and $2.9&nbsp;million (including land acquisition costs)
for each new store built in 2004. We believe that, in the
long-term, ongoing investments in building new stores and
improving existing stores will lead to greater customer traffic
and increased sales.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">78

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='112'></A>
</DIV>

<!-- link1 "BUSINESS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>BUSINESS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Company Overview</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a diversified energy business focused on petroleum
refining and supply and on retail marketing. Our business
consists of two main operating segments: refining and retail.
Our refining segment operates a high conversion, moderate
complexity independent refinery in Tyler, Texas. Our retail
segment markets gasoline, diesel and other refined petroleum
products and convenience merchandise through a network of
349&nbsp;company-operated retail fuel and convenience stores. We
also have a wholesale fuel distribution operation. We have grown
rapidly since our initial acquisition of 198&nbsp;retail sites
in May&nbsp;2001. We believe that our performance-driven,
results-oriented corporate culture is a key element of our
success in executing our strategy and achieving competitive
advantages. We focus on creating value in our existing and
acquired assets through disciplined financial management and
operating expense and loss prevention controls, extensive
utilization of information technology and implementation of
innovative marketing strategies, and by fostering a culture of
dedication and teamwork among our employees. We continually seek
to improve our operations, expand our customer base and identify
desirable acquisition targets.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refining segment.</I> Our refining segment operates a high
conversion, moderate complexity independent refinery with a
design crude distillation capacity of 60,000&nbsp;bpd, along
with an associated crude oil pipeline and light products loading
facilities. The Tyler refinery includes a fluidized catalytic
cracking unit and a delayed coker, enabling us to produce over
93% light products and less than 2% heavy oil products. The
refinery is located in the city of Tyler in East Texas, and is
the only supplier of a full range of petroleum products within a
radius of approximately 115&nbsp;miles of its location. Crude
oil, most of which is produced locally, is delivered to the
Tyler refinery primarily by pipeline, either through
65&nbsp;miles of Delek-owned pipeline or a third-party pipeline
that we lease. The Tyler refinery has the ability to produce and
sell a full range of gasoline, diesel, jet fuels and
petrochemical feedstocks. For the period April&nbsp;29, 2005
through September&nbsp;30, 2005, gasoline accounted for
approximately 52% and diesel and jet fuels accounted for
approximately 41% of the Tyler refinery&#146;s production. The
Tyler refinery&#146;s refined petroleum products are marketed
through our truck loading facilities and third-party pipelines
directly to major oil companies such as ExxonMobil and Chevron,
independent refiners and marketers such as Valero, and jobbers,
distributors, utility and transportation companies and
independent retail fuel operators.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Retail segment.</I> Our retail segment markets gasoline,
diesel, other refined petroleum products and convenience
merchandise through a network of 349&nbsp;company-operated
retail fuel and convenience stores located in Alabama, Arkansas,
Georgia, Kentucky, Louisiana, Mississippi, Tennessee and
Virginia. Our stores operate primarily under the
MAPCO&nbsp;Express<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
East&nbsp;Coast<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
and Discount
Food&nbsp;Mart<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
brands. Approximately 93% of our stores are concentrated in
Tennessee, Alabama and Virginia. Our stores market gasoline and
diesel under our fuel brands as well as the
BP<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
Exxon<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
Shell<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
and
Chevron<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
brands. We also market a broad selection of beverages and
merchandise designed to appeal to the convenience needs of our
customers. In addition, we have begun to sell proprietary food
offerings under our Grille
Marx<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
brand. We also have a wholesale fuel distribution operation that
supplies more than 50 dealer-operated retail locations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For the nine months ended September&nbsp;30, 2005 and the year
ended December&nbsp;31, 2004, we generated net sales of
$1.4&nbsp;billion and $857.9&nbsp;million, respectively, net
income of $39.5&nbsp;million and $7.3&nbsp;million,
respectively, and Adjusted EBITDA of $98.5&nbsp;million and
$31.9&nbsp;million, respectively. Our results for the nine
months ended September&nbsp;30, 2005 reflect the operations of
the Tyler refinery since we acquired it on April&nbsp;29, 2005.
See &#147;Selected Historical Consolidated Financial
Information&#148; for our calculation of Adjusted EBITDA, as
well as a reconciliation of Adjusted EBITDA amounts to net
income, the most directly comparable GAAP measure.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Financial information for our refining and retail segments is
presented in the &#147;Selected Historical Consolidated
Financial Information&#148; and &#147;Unaudited Pro Forma
Condensed Consolidated Financial Data&#148; and discussed in
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations.&#148;
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">79

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Corporate History and Development of the Business</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are a Delaware corporation formed in April 2001. We are an
indirect wholly-owned subsidiary of Delek Group Ltd., a
conglomerate that is domiciled and publicly traded in Israel,
which has significant interests in fuel supply businesses, and
which is controlled by Mr.&nbsp;Yitzchak Sharon Teshuva, an
Israeli citizen. Delek Group Ltd.&#146;s revenues and net income
for the nine months ended September&nbsp;30, 2005, as reported
in its financial statements as of September&nbsp;30, 2005
submitted to the Tel-Aviv Stock Exchange and the Israel
Securities Authority on November&nbsp;28, 2005, were New Israeli
Shekels (NIS)&nbsp;15.1&nbsp;billion and NIS 500&nbsp;million,
respectively (or approximately $3.3&nbsp;billion and
$109&nbsp;million, respectively, based upon an exchange rate of
approximately 4.598 NIS per $1.00 on September&nbsp;30, 2005).
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We were formed by Delek Group Ltd. in connection with our
acquisition in May 2001 of 198 retail fuel and convenience
stores from a subsidiary of The Williams Companies. Since then,
we have completed several other acquisitions of retail fuel and
convenience stores. In 2005, we expanded our scope of operations
to include complementary petroleum refining and wholesale and
distribution businesses by acquiring the Tyler refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our principal acquisitions to date are summarized below:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 9pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="14%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="28%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="28%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="21%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Approximate Purchase</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="left" nowrap><B>Date</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Acquired Company/Assets</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Acquired From</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Price</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    May 2001</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    MAPCO Express, Inc., with 198 retail fuel and convenience stores</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Williams Express, Inc.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    $162.5&nbsp;million</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    June 2001</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    36 retail fuel and convenience stores in Virginia</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    East Coast Oil Corporation</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    $40.1&nbsp;million</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    February 2003</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Seven retail fuel and convenience stores</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Pilot Travel Centers</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    $11.9&nbsp;million</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    April 2004</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Williamson Oil Co., Inc., with 89 retail fuel and convenience
    stores in Alabama, a wholesale fuel and merchandise distribution
    operation</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Williamson Oil Co., Inc.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    $19.8&nbsp;million, plus assumed debt of $28.6&nbsp;million</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    April 2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Refinery, pipeline and other refining, product terminal and
    crude oil pipeline assets located in and around Tyler, Texas,
    including physical inventories of crude oil, intermediates and
    light products</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    La Gloria Oil and Gas Company</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    $68.1&nbsp;million, including $25.9&nbsp;million of prepaid
    crude inventory and $38.4&nbsp;million of assumed crude vendor
    liabilities</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    December 2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    21 retail fuel and convenience stores, a network of four
    dealer-operated stores, four undeveloped lots and inventory in
    the Nashville, Tennessee area</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    BP Products North America, Inc.</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    $35.0&nbsp;million</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We will continue to review acquisition and organic growth
opportunities in the refining, retail fuel and convenience store
markets as well as opportunities to acquire other petroleum sale
and distribution logistical assets such as pipelines, terminals
and fuel storage facilities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Market Opportunities</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe the following factors create a positive outlook for
our business:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Major oil and gas companies and retailers continue to divest
refining and retail assets.</I> Over the past few years, several
major oil and gas companies and retailers have divested
portfolios of refining and retail assets. For example, in 2005,
BP sold stores in the Memphis, Tennessee and Nashville,
Tennessee markets and recently announced its intention to sell
stores in Arizona and Northern California. Shell recently
announced plans to sell sites in Atlanta, Georgia,
Baton&nbsp;Rouge, Louisiana, Memphis, Tennessee, Tampa, Florida
and several other locations across the United States. Similarly,
Shell&nbsp;Oil sold its Bakersfield, California refinery to
Flying&nbsp;J in 2005. We believe that major oil and gas
companies and retailers will
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">80

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
continue to divest refining and retail assets to free their
capital and managements&#146; attention for larger scale
investment opportunities, thus providing us with attractive
acquisition and growth opportunities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Substantial opportunities for consolidation in the
U.S.&nbsp;convenience store industry.</I> The U.S. convenience
store industry is highly fragmented. According to the NACS, the
top 100 companies, ranked by sales, account for only 32% of
total industry sales. In addition, approximately 66% of all
convenience stores in the United States are operated by
companies with less than ten stores. A substantial majority of
these convenience stores are single store operators. We believe
that these smaller operators typically do not have the
combination of operational and financial resources necessary to
implement the marketing strategies and information technology
systems that companies of our size do, and that they do not
enjoy our economies of scale when negotiating contracts, such as
contracts for merchandise or fuel supply. We believe that these
smaller operators are at a competitive disadvantage to us and
that we will continue to be presented with additional
acquisition opportunities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Favorable supply/demand dynamics in the U.S.&nbsp;refining
sector.</I> We believe that high capital costs and environmental
regulatory requirements have limited the growth of refining
capacity, construction of new refineries and the expansion of
existing refineries in the United States over the past
30&nbsp;years. According to the EIA, the number of operable
U.S.&nbsp;refineries has decreased from 319 in 1980 to 148 in
2005. The last major new oil refinery in the United States was
built in 1976. We believe that limited refining capacity in the
United States, along with increasing utilization rates and
steadily increasing demand for refined petroleum products, has
produced a sustainable shift in market dynamics that will
benefit our refining segment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Expansion opportunities beyond our current geographic
footprint.</I> Our retail business is currently concentrated in
the southeastern United States, especially in Tennessee, Alabama
and Virginia. We believe that states adjacent to those in which
we currently operate, or in which we currently have a relatively
small number of stores, such as Florida, North&nbsp;Carolina,
South Carolina, Arkansas, Georgia, Mississippi, Kentucky,
Louisiana and Texas, provide opportunities for us to expand.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Competitive Advantages</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe we enjoy the following competitive advantages:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Proven ability to integrate acquisitions.</I> As a result of
our performance-driven, results-oriented corporate culture,
dedicated work force and commitment to excellence through
operations and training, we have been successful in rapidly
integrating our refinery acquisition, four large retail fuel and
convenience store acquisitions and several smaller acquisitions
since our formation in 2001. Since our acquisition of the Tyler
refinery, we have implemented managerial and operational
enhancements that have resulted in increased refinery
utilization, an increase in our truck rack margins and expansion
of our customer base. We have also improved the productivity and
profitability of the convenience stores we acquired by
implementing merchandising and fuel sales initiatives,
instituting operating expense and loss prevention controls,
reducing overhead and centralizing functions such as accounting,
purchasing and information technology.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Niche market refinery.</I> Our Tyler refinery is located in a
niche market and primarily produces high value transportation
fuels. Our Tyler refinery is the only supplier of a full range
of refined petroleum products within a radius of approximately
115&nbsp;miles of its location. Our owned and leased pipelines
are connected to five crude oil pipeline systems that provide us
with access to East Texas, West Texas and other domestic and
foreign crude oils. The refinery owns the larger of two truck
rack facilities for the loading of transportation fuels in the
vicinity of Tyler, Texas and supplies the other one. We believe
this provides us with a cost advantage over other companies that
would need to import transportation fuel via truck from outside
the region. We believe that demand in the local and regional
markets is sufficient to absorb the additional supply of refined
petroleum products that will result from our increased refinery
utilization. For the period April&nbsp;29, 2005 through
September&nbsp;30, 2005, gasoline accounted for approximately
52% and diesel and jet fuels accounted for approximately 41% of
the Tyler refinery&#146;s production. In addition, the Tyler
refinery utilizes only approximately 100 out of the
663&nbsp;acres of land we own in Tyler, providing us with
opportunities for expansion and growth on the remaining land.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">81

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Management focus and merchandising and operations
expertise.</I> We believe that our management approach
encourages employee participation in decision-making. This
approach allows us to identify market trends and opportunities
and to rapidly implement store specific strategies and programs
to exploit those trends and opportunities to improve results of
operations at our stores. Human and technological intelligence
is key to our retail business strategy, which is based on the
concept of the &#147;neighborhood&#148; store&nbsp;&#151;
pricing and stocking each store individually to meet the customs
and tastes of the community, while at the same time using our
market presence to take advantage of the purchasing economies of
scale and the marketing and operating sophistication and
financial resources of a large convenience store operator. We
believe our merchandising strategy positions our new and
existing sites as the preferred destinations for purchases of
immediate consumption convenience goods. Our management approach
also incorporates a strong focus on controlling operating
expenses and loss prevention, which has been an important
element in the successful development of our retail segment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Strong market presence in our existing retail markets.</I> We
have a leading market position in our core markets in the
southeastern United States, where we have a concentrated
portfolio of quality retail stores. &#147;MAPCO&#148; is a
well-recognized name throughout the southeastern United States,
and our &#147;East Coast&#148; and &#147;Discount Food
Mart&#148; brands are well known in Virginia and Alabama, the
respective markets in which we operate. Our market penetration
in those markets drives brand recognition among customers. We
believe that we rank first among convenience store operators in
terms of the number of stores in each of the Nashville, Memphis
and Northern Alabama regions. We believe that we rank third
among convenience store operators in the number of stores in the
Richmond, Virginia region. This concentration of stores enables
us to realize economies of scale and cost-efficiencies and
provides us with a platform for continued growth through
acquisitions in these core regions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Scalable information technology systems.</I> We believe that
our information technology systems allow us to maximize sales
and margins and reduce inefficiencies in our cost structure by
delivering timely and focused feedback on margins and sales
volume. These systems enable our merchandising managers to react
quickly to maximize our profit opportunities. Most of our stores
provide real-time information via high speed data networks to
our supply chain management, inventory management and security
systems. Our refinery systems enable real-time monitoring of
customer-specific sales volumes and margin impacts. These
systems are integrated into many aspects of our operations. We
believe these systems are scalable and will support future
growth plans. For example, we have invested significant time and
effort in developing a proprietary point of sale, or POS system,
for our retail stores that integrates all operations of our
stores with the reporting processes of our accounting
department. Our POS system is dynamic and can easily and quickly
support additional stores.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Experienced Management.</I> We believe that our strong
management is a key element of our competitive advantages and
our ability to continue to successfully execute our strategies.
The management teams of both our refining and retail segments
have extensive industry experience. For example, the most senior
manager of our refining segment and each of his four direct
reports have, on average, approximately 26&nbsp;years industry
experience, and the eight most senior operations and marketing
managers of our retail segment have an average of approximately
28&nbsp;years industry experience. Our management&#146;s
experience also includes a strong cross-section of disciplines,
including marketing, operations, finance and information
technology.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Strategy</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to strengthen our market position, enhance growth and
maximize our profitability and cash flow, we intend to:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Pursue opportunistic acquisitions that strengthen our core
markets and leverage our core competencies.</I> We have a track
record of rapidly expanding our business through asset
acquisitions. As we seek to grow, we will opportunistically
target assets or businesses where we can apply our core
competencies of integrating assets and apply our merchandising
expertise, operating expense and loss prevention controls and
information technology platform to substantially enhance their
operating and financial performance. Our retail business is
currently concentrated in the southeastern United States,
especially in Tennessee, Alabama and Virginia. We
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">82

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
intend to expand into states adjacent to those in which we
currently operate or in which we currently have fewer stores,
such as Florida, North Carolina, South Carolina, Arkansas,
Georgia, Mississippi, Kentucky and Louisiana. We may also seek
to expand our retail business into the Tyler, Texas area, which
would give us the benefit of physically integrating a portion of
our retail segment with the Tyler refinery. Our goal is to
continue to expand our retail business through acquisitions and
new store development, and we intend to actively pursue
additional refinery acquisitions. Target refineries may or may
not be inside our current geographic operating areas. We also
plan to selectively pursue additional acquisitions of logistic
and other assets complementary to our refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Modernize and improve the profitability of our Tyler
refinery.</I> We have implemented, and intend to continue to
implement, operational changes and capital investments to
improve the efficiency, processing capacity and utilization of
our Tyler refinery. Our management team has begun to and will
continue to source new crude supplies, including foreign crude,
to provide us with greater flexibility in optimizing the
feedstock supply to the Tyler refinery. Recently, and at no
capital cost, we have effectively increased the delivery
capacity of our leased pipeline through the use of drag-reducing
chemicals. We believe that our operational improvements and
increased crude oil delivery capacity will allow us to increase
the Tyler refinery&#146;s average crude oil throughput from
historic levels of approximately 50,000&nbsp;bpd to almost
60,000&nbsp;bpd by early 2006. We have purchased a 50&nbsp;long
ton per day sulfur recovery unit and a 75&nbsp;long ton per day
tail gas treating unit to supplement the refinery&#146;s
existing sulfur recovery capacity of 19.4 short tons per day.
This unit will be installed in 2006. We are in the process of
revamping an existing distillate desulfurization unit from its
current capacity of 12,000&nbsp;bpd to 22,000&nbsp;bpd, allowing
us to reduce the sulfur level in all of our diesel fuel to less
than 15&nbsp;parts per million. This project is scheduled for
completion by mid-2006. We are also reviewing multiple
efficiency enhancements and capital expansion projects to
increase our profitability. These projects include upgrading and
centralizing our refinery control systems, installing energy
conservation systems, expanding the capacity of our refinery,
upgrading our processing units to allow us to process lower
quality crude oil and expanding our distribution system beyond
our current market. We have engaged refinery engineering
consultants to conduct a feasibility study that evaluates
several of these projects, which we expect to be delivered in
early 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Consistent with our performance-driven, results-oriented
corporate culture, we believe in instilling responsibility and
accountability to all levels of staffing. We believe this
strategy has resulted, and will continue to result, in a
corporate culture that quickly identifies and evaluates
challenges, finds innovative and permanent solutions, and
implements them in a timely and cost-effective manner.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Grow the customer base and improve the profitability of our
Tyler-area niche market.</I> We believe that there is additional
demand in the Tyler, Texas area for products produced at our
Tyler refinery. Since acquiring the refinery in April 2005, we
have been successful in expanding our customer base and in
increasing sales to existing customers. We plan to continue to
target potential customers who currently have supply contracts
with others but may be interested in purchasing from us. We
believe that our efforts to improve the reputation of the truck
rack with respect to timely loading and product availability
will continue to draw former customers of the refinery back to
our rack, and attract new customers. In addition to increasing
sales, our management team intends to continue renegotiating
marketing contracts on more favorable terms, in order to further
benefit from the competitive advantage we have in our niche
market location.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Reinforce our brand recognition through targeted retail
merchandising strategies.</I> We intend to maintain our position
as a strong retail competitor in the southeastern United States.
To increase brand awareness in our markets, we are in the
process of implementing a new branding and re-imaging campaign
that will include the retrofitting of select existing stores and
the building of new stores with the &#147;MAPCO Mart&#148;
brand. We aim to maintain our existing customer base while
attracting a more upscale clientele to our re-imaged stores by
offering premium amenities and products, such as a proprietary
<FONT style="white-space: nowrap">made-to</FONT>-order food
program with touch-screen order machines, indoor and outdoor
seating, expanded coffee and hot drink bars, an expanded cold
and frozen drink area where customers can customize their drink
flavors, a walk-in beer cave, fresh flowers, greeting cards,
produce and gourmet breads. We will continue to emphasize our
&#147;neighborhood
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">83

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
store&#148; concept by focusing on customizing product mix and
promotional strategies based on the demographics surrounding
each location. We will also focus on offering &#147;signature
items&#148;&nbsp;&#150; unique items or programs that we feature
on signage, in training and on displays&nbsp;&#150; to
differentiate ourselves from our competitors. In addition, a
major component of our new branding campaign is to increase
sales from fresh food service, the fastest&nbsp;&#150; growing,
highest-margin category in the convenience store segment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Continually renew the physical assets of our retail
business.</I> We intend to ensure that our retail stores are
positioned to maximize customer traffic and provide our
consumers with an enhanced purchasing experience. We are in the
process of upgrading our retail stores through extensive
remodeling, raze-and-rebuilding and acquisition. We are also
developing a supplementary growth strategy that focuses on new
site selection and construction to complement our acquisition
strategy. As part of our strategy, we may divest underperforming
or non-strategic stores by either converting them to dealer
operated locations or closing them and then selling or leasing
the real estate for other business use, as appropriate. We
believe that these steps will lead to improved operating results.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Develop innovative information technology applications in all
of our businesses.</I> We intend to continue our investment in
technological infrastructure. We believe that by leveraging our
innovative information technology platform, we will be able to
better address the needs of our customers. In addition, by
optimizing our information technology, we also expect to improve
our operating efficiencies and improve our management of
inventory. We are implementing a scanning and data warehouse
management system to integrate with our POS systems at each of
our retail stores. This system, which we expect to roll out to
substantially all of our stores in 2006, will enable us to
better manage our inventory, optimize our marketing strategy,
manage our stores on a site level basis, and reduce cash and
merchandise shortages. Taken together, we expect these factors
to allow us to improve our gross profit dollars and operating
results.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Refining Segment</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We operate a high conversion, moderate complexity independent
refinery with a design crude distillation capacity of
60,000&nbsp;bpd, along with an associated crude oil pipeline and
light products loading facilities. The refinery is located in
the city of Tyler in East Texas, and is the only supplier of a
full range of refined petroleum products within a radius of
approximately 115&nbsp;miles of its location.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Tyler refinery is situated on approximately 100 out of a
total of 663&nbsp;acres of land owned by us. The Tyler refinery
includes a fluidized catalytic cracking unit and a delayed
coker, enabling us to produce over 93% light products and less
than 2% heavy oil products. It has the ability to produce and
sell a full range of gasoline, diesel, jet fuels, liquefied
petroleum gas, or LPG, and natural gas liquids, or NGLs. For the
period April&nbsp;29, 2005 through September&nbsp;30, 2005,
gasoline accounted for approximately 52% and diesel and jet
fuels accounted for approximately 41% of the Tyler
refinery&#146;s production.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The inland location of the Tyler refinery provides a degree of
protection from the effects of tropical weather. While Hurricane
Rita caused significant property damage and resulted in a
substantial period of down time for numerous refiners in
Southern Texas, the Tyler refinery maintained stable operations
throughout, and was the sole supplier of refined petroleum
products in East Texas during late September 2005, as competing
terminals in our region ran out of supply.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Fuel Customers.</I> We have the advantage of being able to
deliver nearly all of our gasoline and much of our diesel fuel
production into the local market. Our customers have strong
credit profiles and include major oil companies, independent
refiners and marketers, jobbers, distributors, utility and
transportation companies, and independent retail fuel operators.
Our refinery&#146;s ten largest customers accounted for
$356.7&nbsp;million, or 60.5%, of net sales for the refinery for
the period April&nbsp;29, 2005 (the date we acquired the Tyler
refinery) to September&nbsp;30, 2005. Our customers include
ExxonMobil, Valero Marketing and Supply, Truman Arnold and
Chevron, among others. Although none of our customers account
for 10% or more of our consolidated net sales, ExxonMobil and
Valero Marketing and Supply accounted for approximately 15% and
10%, respectively, of net sales for the refinery for the period
April&nbsp;29, 2005 to September&nbsp;30, 2005.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">84

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Tyler refinery does not generally supply fuel to our retail
fuel and convenience stores, since it is not located in the same
geographic region as our stores.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Refinery Design and Production.</I> The Tyler refinery has a
crude oil processing unit with a 60,000&nbsp;bpd atmospheric
column and a 16,000&nbsp;bpd vacuum tower. The other major
process units at the Tyler refinery include a 20,200&nbsp;bpd
fluid catalytic cracking unit, a 6,800&nbsp;bpd delayed coking
unit, a 20,000&nbsp;bpd naphtha hydrotreating unit, a
12,000&nbsp;bpd distillate hydrotreating unit, a 17,500&nbsp;bpd
continuous regeneration reforming unit, a 5,000&nbsp;bpd
isomerization unit, and an alkylation unit with a capacity of
4,700&nbsp;bpd.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In February 2005, the prior owner of the Tyler refinery
conducted a turnaround on the crude unit, vacuum unit, delayed
coking unit, naphtha hydrotreater, CCR Platformer and distillate
hydrotreating unit. In December 2005, we successfully completed
an additional turnaround on the remainder of the refinery units,
including the fluid catalytic cracking unit, the sulfuric
alkylation unit, sulfur recovery unit, amine unit and kerosene
and gasoline treating units. We do not plan to conduct another
refinery turnaround earlier than 2009.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Tyler refinery was designed to process light, sweet crude
oil, which is a higher quality, more expensive crude oil than
heavy, sour crude oil. Our owned and leased pipelines are
connected to five crude oil pipeline systems that allow us
access to East Texas, West Texas and foreign sweet crude oils. A
small amount of local East Texas crude oil is also delivered to
the refinery by truck. The table below sets forth information
concerning crude oil received at the Tyler refinery from
April&nbsp;29, 2005 to September&nbsp;30, 2005:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="79%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Percentage of</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Crude Oil</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="left" nowrap><B>Source</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Received</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    East Texas Crude Oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>72%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    West Texas Intermediate Crude Oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Foreign Sweet Crude Oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4%</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon delivery to the Tyler refinery, crude oil is sent to a
distillation unit, where complex hydrocarbon molecules are
separated into distinct boiling ranges. The processed crude oil
is then treated in specific units of the refinery, and the
resulting distilled and treated fuels are pumped to blending
units to create the desired finished fuel product. A more
detailed summary of our production output for the period
April&nbsp;29, 2005 through September&nbsp;30, 2005 follows:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <I>Gasoline.</I> Gasoline accounted for approximately 52% of our
    refinery&#146;s production. The refinery produces four different
    grades of conventional gasoline (premium&nbsp;&#151; 92 and 93
    octane, regular and mid-grade), as well as aviation gasoline.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <I>Diesel/jet fuels.</I> Diesel and jet fuel products accounted
    for approximately 41% of our refinery&#146;s production. Diesel
    and jet fuel products include military specification jet fuel
    <FONT style="white-space: nowrap">(JP-8),</FONT> commercial jet
    fuel, high sulfur diesel (No.&nbsp;2 oil), low sulfur diesel,
    and ultra low sulfur diesel.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <I>Petrochemicals.</I> We produce small quantities of propane,
    refinery grade propylene and butanes.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <I>Other products.</I> We produce small quantities of other
    products, including, anode grade coke, slurry oil, sulfur and
    other blendstocks.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The average throughput of the refinery between January&nbsp;1,
2002 and April&nbsp;29, 2005, was 50,833&nbsp;bpd. The average
throughput since we took ownership of the Tyler refinery on
April&nbsp;29, 2005 through September&nbsp;30, 2005 has been
53,765&nbsp;bpd. The table below sets forth information
concerning the historical
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">85

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
throughput and production at the Tyler refinery. The data for
all periods prior to April&nbsp;29, 2005 have been derived from
the internal financial records of the previous owner.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 8pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="24%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>


<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>Nine Months Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Delek</B></TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap><B>Year Ended December&nbsp;31</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>September&nbsp;30,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Ownership(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="23" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>2005(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR style="font-size: 7pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bpd</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bpd</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bpd</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bpd</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bpd</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bpd</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refinery throughput:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>50,893</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>96.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>50,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>96.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>46,885</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>93.9</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47,202</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>94.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47,576</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>97.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,887</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>98.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other blendstocks</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,873</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.8</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,051</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.1</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,007</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,491</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>878</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total refinery throughput</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,766</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,532</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49,936</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>50,209</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49,067</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53,765</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Products produced:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gasoline</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29,336</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>56.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29,775</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>57.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,349</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>57.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,778</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,594</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,366</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Diesel/ jet</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18,452</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,627</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,613</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35.8</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18,272</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>38.1</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,288</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40.8</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petrochemicals, LPG, NGLs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,451</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.7</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,408</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,153</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,254</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,073</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.3</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,517</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.8</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,591</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.1</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.9</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,108</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,095</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,001</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,061</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total products produced</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>51,830</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>51,850</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49,223</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49,460</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>47,940</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52,232</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Throughput during the nine months ended September&nbsp;30, 2005
    reflects reductions resulting from the turnaround conducted by
    the previous owner during the first quarter of 2005.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Effective April&nbsp;29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155&nbsp;days in the fiscal period ended
    September&nbsp;30, 2005.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We currently are evaluating the economic feasibility of several
projects to expand our refinery output and productivity, which
include expanding the capacity of our refinery and upgrading our
processing units to allow us to process higher sulfur crude oils.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Storage Capacity.</I> Storage capacity at the Tyler refinery,
including tanks along our pipeline, totals approximately
2.7&nbsp;million barrels, consisting of approximately
1.2&nbsp;million barrels of crude oil storage and
1.5&nbsp;million barrels of refined and intermediate product
storage.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Supply and Distribution.</I> The majority of the crude oil
purchased for the Tyler Refinery is East Texas crude oil. Most
of this East Texas crude oil processed in our refinery is
delivered by truck or through our pipeline and leased pipeline
from Nettleton Station in Longview, Texas. This represents an
inherent cost advantage due to our ability to purchase crude oil
on its way to market, as opposed to purchasing from a market or
trade location. We primarily purchase crude oil with monthly
spot trading contracts from various suppliers. Our ability to
access WTI or foreign sweet crude oil, when they are available
at competitive prices, has helped significantly to maintain the
refinery&#146;s competitive supply cost advantage. These
alternate supply sources allow us to optimize the refinery
operation and utilization while also allowing us to more
favorably negotiate the cost and quality of the local East Texas
crude oil we purchase.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our owned crude oil pipeline consists of approximately
65&nbsp;miles of principally
<FONT style="white-space: nowrap">6-inch</FONT> crude oil lines
that transport light sweet crude oil to the Tyler refinery. We
currently operate the main trunk line, and the following pump
stations and terminals that are also owned by us:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Delek Tank Farm: One 150,000&nbsp;barrel and one
    300,000&nbsp;barrel tank.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Nettleton Station: Five 50,000&nbsp;barrel tanks.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Bradford Station: One 50,000&nbsp;barrel and one
    10,000&nbsp;barrel tank.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    ARP Station: Two 50,000&nbsp;barrel tanks.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The vast majority of the transportation fuels and other products
are sold via truck directly from the refinery. We operate a nine
lane transportation fuels truck rack with a wide range of
additive options, including proprietary packages dedicated for
use by our major oil company customers. LPG, NGLs, and clarified
slurry oil are also sold via truck from dedicated loading
facilities at the refinery. We also have a
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">86

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
pipeline connection for the sale of propane into a facility
owned by Texas Eastman. Petroleum coke is sold primarily via
rail from the refinery, with occasional truck loading for
specialty or excess product.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The remainder of our transportation fuels are sold via pipeline
to a single, pipeline-connected terminal owned by Chevron. We
transport these products on TEPPCO pipeline to a point of
interconnection to a Chevron-owned pipeline terminating in Big
Sandy, Texas. There are currently no other pipeline-connected
destinations for our transportation fuels.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Safety.</I> Our refinery has historically had a good safety
record. We have an extensive safety training program for our
refinery&#146;s employees.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Competition.</I> The refining industry is highly competitive
and includes fully integrated national or multinational oil
companies engaged in many segments of the petroleum business,
including exploration, production, transportation, refining,
marketing and convenience stores. Our principal competitors are
Texas Gulf Coast refiners, product terminal operators in our
region and Calumet Lubricants in Shreveport, Louisiana. The
principal competitive factors affecting our refinery operations
are crude oil and other feedstock costs, refinery product
margins, refinery efficiency, refinery product mix and
distribution and transportation costs. Certain of our larger
competitors operate refineries that are larger and more complex
and, as a result, could have lower per barrel costs or higher
margins per barrel of throughput. We have no crude oil reserves
and are not engaged in exploration. We believe however, that
absent unforeseen circumstances, or those beyond our control, we
will be able to obtain adequate crude oil and other feedstocks
at generally competitive prices for the foreseeable future.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Retail Segment</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We operate 349 retail fuel and convenience stores, which are
located in Alabama, Arkansas, Georgia, Kentucky, Louisiana,
Mississippi, Tennessee and Virginia, primarily under the MAPCO
Express<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
East
Coast<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>
and Discount Food
Mart<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
brands. Our retail fuel and convenience store segment also
includes a wholesale fuel distribution operation that supplies
more than 50&nbsp;dealer-operated retail locations. We believe
that we have established strong brand recognition and market
presence in the major retail markets in which we operate.
Approximately 93% of our stores are concentrated in Tennessee,
Alabama and Virginia. In terms of number of retail fuel and
convenience stores, we rank in the top-tier in our major markets
such as, Nashville, Memphis, northern Alabama and Richmond.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We operate a successful business model that we believe enables
us to generate higher per gallon gas margins than the industry
average as well as drive merchandise sales that are higher than
the industry average. Our stores are positioned in high traffic
areas (approximately 70% of our stores are located at corner
locations) and we employ a localized marketing strategy that
focuses on the demographics surrounding each store and
customizing the product mix and promotional strategies to meet
the needs of customers in those demographics. In addition, we
utilize operating expense and loss prevention controls to
enhance operating performance.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Company-Operated Stores.</I> Of our sites, approximately 66%
are open 24&nbsp;hours per day and the remaining sites are open
at least 16&nbsp;hours per day. Our average store size is
approximately 2,300&nbsp;square feet with approximately 64% of
our stores being more than 2,000&nbsp;square feet.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our retail fuel and convenience stores typically offer tobacco
products and immediately consumable items such as beer,
non-alcoholic beverages and a large variety of snacks and
prepackaged items. A significant number of the sites also offer
state sanctioned lottery games and ATM services. Several of our
locations also include well recognized national quick service
food chains such as
Subway<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
and we have begun to offer proprietary food offerings under our
GrilleMarx<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
brand. In light of the popularity and growth of upscale coffee
shops, we have entered into an agreement with a coffee roaster
to provide us with product that we believe is of significantly
higher quality than what is typically offered in the self
service environment. We have also initiated a segment-wide focus
on sales and marketing of food, coffee and fountain drinks, and
we have begun the development of our &#147;next generation
store&#148;, a unique concept and store designed to add quality
fresh food offerings in an upscale, state of the art facility.
This new concept is expected to generate
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">87

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
higher margins and is intended to expand our potential customer
base by attracting the core convenience store shopper as well as
those seeking a meal solution. This concept will be added to new
stores as well as retrofitted into selected existing locations.
Additionally, we plan to introduce private label lines to our
soft drink, sandwich, and automotive products offerings which
typically enhance margins.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All of our locations are retail fuel and convenience stores. The
majority of our retail fuel and convenience stores have 4 to 5
multi-pump dispensers with credit card readers. Virtually all of
our company-operated locations have a canopy to protect
self-service customers from rain and to provide street appeal by
creating a modern, well-lit and safe environment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Fuel Operations.</I> For the nine months ended
September&nbsp;30, 2005 and the year ended December&nbsp;31,
2004, our net fuel sales were 72.5% and 69.6%, respectively, of
net sales for our retail segment. The following table highlights
certain information regarding our fuel operations for the years
ended December&nbsp;31, 2002, 2003 and 2004 and the nine months
ended September&nbsp;30, 2004 and 2005:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="50%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Number of stores (end of period)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>243</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>332</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>328</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average number of stores</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>242</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>310</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>329</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel sales (thousands of gallons)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,396</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267,476</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>315,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>231,315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>249,507</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Average retail gallons per average number of stores (thousands
    of gallons)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,133</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>766</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>758</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retail fuel margin (per gallon)(1)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.130</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.155</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.164</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lundberg Survey Rack-to-Retail Fuel Margin (per gallon)(2)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.116</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.137</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.116</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.109</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$0.121</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Retail fuel margins per gallon are calculated as the retail
    sales price less fuel discounts, costs of product, and
    transportation.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Rack-to-retail margins shown in the chart above are a weighted
    average composite of rack-to-retail margins for diesel and
    gasoline sales, including regular, medium grade and premium
    unleaded gasoline, in Alabama, Tennessee and Virginia, based on
    Lundberg Survey data. Of our 349 retail fuel and convenience
    stores, 326 are located in those states, and the margins have
    been weighted to correspond to our percentage sales of the
    various grades and types of fuel sold by us in those states.
    Because we report fuel sales as a composite of our gasoline and
    diesel sales, and because our retail fuel and convenience stores
    are concentrated in Alabama, Tennessee and Virginia, we believe
    that this Lundberg Survey Rack-to-Retail Margin represents the
    most accurate benchmark with which to compare our historical
    fuel margins to those of the industry.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We currently operate a fleet of delivery trucks to deliver
approximately 61% of the fuel sold at our retail fuel and
convenience stores. We purchased approximately 53% of the fuel
used at our retail fuel and convenience stores for the nine
months ended September&nbsp;30, 2005 from the Valero Marketing
and Supply under a contract that extends through the second
quarter of 2008. We also purchase fuel under contracts with BP,
ExxonMobil, Shell and Chevron, and purchase the balance of our
fuel from a variety of independent fuel distributors. The fuel
purchased is generally based on contracted differentials to
local and regional price benchmarks. The initial terms of our
supply agreements range from one year to 15 years and generally
contain minimum monthly or annual purchase requirements. To
date, we have met substantially all our purchase commitments
under these contracts.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Tyler refinery does not generally supply fuel to our retail
fuel and convenience stores, since it is not located in the same
geographic region as our retail stores.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">88

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Merchandise Operations.</I> For the nine months ended
September&nbsp;30, 2005 and the year ended December&nbsp;31,
2004, our merchandise sales were 27.5% and 30.5%, respectively,
of net sales for our retail segment. The following table
highlights certain information with respect to our merchandise
sales for the years ended December&nbsp;31, 2002, 2003 and 2004
and for the nine months ended September&nbsp;30, 2004 and 2005:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="55%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>%</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total merchandise sales as a percentage of net sales for our
    retail segment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comparable store merchandise sales change</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>N/A</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3.1</TD>
    <TD align="left" valign="bottom" nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.1</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise margin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26.7</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise profit as a percentage of total margins</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61.2</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58.9</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60.6</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61.4</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61.0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on merchandise sales information, we estimate our sales as
a percentage of total merchandise sales in the following
categories for the years ended December&nbsp;31, 2002, 2003 and
2004 and for the nine months ended September&nbsp;30, 2004 and
2005 were as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Nine Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>September&nbsp;30,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cigarettes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37.8%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>36.6%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33.8%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33.7%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33.8%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other tobacco products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.3%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.1%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.1%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.9%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.3%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Beer</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18.7%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18.2%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17.4%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17.5%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17.1%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Soft drinks</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7.9%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8.8%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.3%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.3%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.3%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Dairy products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.5%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7.1%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.2%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Candy/ gum</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.5%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.8%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.7%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2.6%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.0%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Snacks/ groceries</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.8%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7.1%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.9%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.7%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7.0%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Food service</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.9%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.1%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5.9%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General merchandise</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7.5%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8.6%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.8%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.1%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.3%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.2%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4.2%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.6%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total merchandise sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We purchased approximately 45% of our general merchandise,
including most tobacco products and grocery items for the nine
months ended September&nbsp;30, 2005 from a single wholesale
grocer, McLane Company, Inc., a wholly-owned subsidiary of
Berkshire Hathaway. Our contract with McLane expires in 2007,
but may be renewed at our option for an additional two year
period. Other major suppliers and manufacturers include
Coca-Cola, Pepsi-Cola, Frito Lay, Gatorade, Hershey&#146;s,
Kraft/ Nabisco and Oscar Mayer.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Technology and Store Automation.</I> We have developed
proprietary information management software programs that enable
us to access near real-time data to manage our stores on a
site-level basis and react rapidly to changes in our market.
Most of our stores are connected to a high speed data network
and provide near real-time information to our supply chain
management, inventory management and security systems. We
believe that our systems provide many of the most desirable
features commercially available today in the information
software market, while providing more rapid access to data,
customized reports and greater ease of use. Our information
technology systems help us manage our inventory, optimize our
marketing strategy, manage our stores on a site level basis, and
reduce cash and merchandise shortages. Our information
technology systems allow us to improve our profitability and
strengthen operating and financial performance in multiple ways,
including by:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    tracking sales of complementary products; for example,
    determining the impact of fuel price movements on in-store sales
    or tracking the impact of a beer promotion on cigarette sales;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">89

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    providing real-time fuel inventory data on a per store basis to
    optimize fuel purchase and distribution costs;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    pricing fuel at individual stores on a daily basis, taking into
    account competitors&#146; prices, competitors&#146; historical
    behavior, daily changes in cost, and the impact of pricing on
    in-store merchandise sales;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    alerting us on a daily basis by store, district, and/or division
    to negative sales trends; for example, merchandise categories
    that are below budget or below the prior period&#146;s results;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    reconciling store reported daily cash deposits and credit card
    settlements with electronic data from our vendor relationships
    to manage our current assets;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    integrating our security video with our point of sales
    transaction log in a searchable database that allows us to
    search for footage related to specific transactions, which
    enables us to identify potentially fraudulent transactions and
    employ real-world examples through which to train our employees.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Dealer Operations.</I> Our retail segment also includes a
wholesale fuel distribution network that supplies more than 50
dealer-operated retail locations. For the nine months ended
September&nbsp;30, 2005 and the year ended December&nbsp;31,
2004, our dealer net sales were approximately 5% and 4%,
respectively, of net sales for our retail segment. Our business
arrangements with dealers include contractual arrangements in
which we pay a commission to the dealer based on profits from
the fuel sales, contractual arrangements in which we supply fuel
and invoice the dealer for its cost of fuel plus an agreed upon
margin, and non-contractual arrangements in which dealers order
fuel from us at their discretion.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Some dealers either lease or sublease their facilities from us
and one dealer operates a location formerly owned and operated
by us. While we have agreements with our dealers that set forth
certain operating standards and the fuel purchase arrangements
described above; we do not control the dealers&#146; personnel,
merchandise pricing, policies or other aspects of their
business. Other than fuel sales through dealers who receive
contractual commissions from us, we realize little direct
benefit from the sale of fuel or merchandise at the
dealer-operated stores, and their revenues from such sales are
not reflected in our consolidated financial statements. We
believe our relationships with dealers have been favorable,
providing us with customers for our fuel products and an
opportunity to divest certain company-operated stores that do
not fit within our business strategy.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Competition.</I> The retail fuel and convenience store
business is highly competitive. We compete on a store-by-store
basis with other independent convenience store chains,
independent owner-operators, major petroleum companies,
supermarkets, drug stores, discount stores, club stores, mass
merchants, fast food operations and other retail outlets. Major
factors of competition include location, ease of access,
pricing, product and service selections, customer service, fuel
brands, store appearance, cleanliness and safety. Changes in
traffic patterns and the type, number and location of competing
stores affect the performance of our stores. In addition,
factors such as inflation, increased labor and benefit costs and
the lack of availability of experienced management and hourly
employees would adversely affect the retail fuel and convenience
store industry.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Properties</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We own our refinery in Tyler, Texas, which is situated on
approximately 100 out of a total of 663&nbsp;acres of land owned
by us, along with an associated crude oil pipeline and light
products loading facilities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of December&nbsp;15, 2005, we owned the real estate at 210
retail fuel and convenience store locations, and leased the real
property at 168 stores. Of the stores owned or leased by us, 21
were either leased or subleased to third party dealers; 40 other
dealer sites are owned or leased independently by dealers.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">90

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table summarizes the real estate position of our
retail segment.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="19%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Remaining</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Remaining</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Company-</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Lease Term</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Lease Term</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="left" nowrap><B>State</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Operated Sites</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Dealer Sites(1)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owned Sites</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Leased Sites</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>&#60;3&nbsp;Years(2)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>&#62;3&nbsp;Years(2)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Tennessee</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>198</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>104</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>102</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>99</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Alabama</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>44</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Virginia</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Arkansas</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Kentucky</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Louisiana</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Mississippi</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Georgia</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Florida</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>349</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>210</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>168</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>162</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Includes 40 sites neither owned by nor subleased from us.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Includes renewal options; measured as of September&nbsp;30, 2005.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Most of our retail fuel and convenience store leases are net
leases requiring us to pay taxes, insurance and maintenance
costs. Of the leases that expire in less than three years, we
anticipate that we will be able to negotiate acceptable
extensions of the leases for those locations that we intend to
continue operating.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We lease our 26,704&nbsp;square foot corporate headquarters at
830 Crescent Centre Drive, Franklin, Tennessee. Our lease
expires in November 2006. We anticipate that we will require
additional space for our headquarters by the end of the term of
the lease, and do not foresee any problems with obtaining
suitable additional space.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Government Regulation and Environmental Matters</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Many aspects of our operations are subject to regulation under
federal, state and local laws. The most significant of the
regulations are described below. While we believe we are in
substantial compliance with these laws, the laws and regulations
we are subject to change often, may be re-interpreted by
regulators or may become more stringent. The ultimate impact of
complying with existing laws and regulations is not always
clearly known or determinable due in part to the fact that our
operations may change over time.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Environmental Matters</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are subject to extensive federal, state and local laws and
regulations relating to protection of the environment. These
laws and the accompanying regulatory programs and enforcement
initiatives, some of which are described below, impact our
business and operations by imposing:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    restrictions on our ongoing operations through permits and
    regulations;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    liability for the remediation of contaminated soil, groundwater
    and other environmental media at our current or former
    facilities and at facilities where we have disposed of hazardous
    substances;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    specifications on the refined petroleum products we market,
    including gasoline and diesel fuel;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    regulation of fuel storage at our retail fuel and convenience
    stores.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
These regulations and other new air and water quality standards
and stricter fuel regulations could result in increased capital,
operating and compliance costs.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">91

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Environmental Obligations&nbsp;&#151; The Tyler Refinery.</I>
The principal environmental risks associated with our refinery
operations are air emissions, releases into soil and groundwater
and wastewater excursions. The primary legislative and
regulatory programs that affect these areas are outlined below.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I><U>The Clean Air Act.</U></I> The federal Clean Air Act and
the corresponding state laws that regulate emissions of
materials into the air affect refining operations both directly
and indirectly. Direct impacts on refining operations may occur
through Clean Air Act permitting requirements and/or emission
control requirements relating to specific air pollutants. The
Clean Air Act indirectly affects refining operations by
extensively regulating the air emissions of sulfur dioxide and
other compounds, including nitrogen oxides, emitted by
automobiles, utility plants and mobile sources, which are direct
or indirect users of our products. In addition, volatile organic
compounds emitted at the refinery are heavily regulated,
including such compounds as benzene.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Clean Air Act imposes stringent limits on air emissions,
establishes a federally mandated operating permit program and
allows for civil and criminal enforcement sanctions. The Clean
Air Act also establishes attainment deadlines and control
requirements based on the severity of air pollution in a
geographical area.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I><U>The Clean Water Act.</U></I> The federal Clean Water Act
of 1972 affects refining operations by imposing restrictions on
effluent discharge into, or impacting, navigable water. Regular
monitoring, reporting requirements and performance standards are
preconditions for the issuance and renewal of permits governing
the discharge of pollutants into water. We maintain discharge
permits as required under the National Pollutant Discharge
Elimination System program of the Clean Water Act and have
implemented internal programs to oversee our compliance efforts.
In addition, we are regulated under the federal Oil Pollution
Act, which amended the Clean Water Act. Among other
requirements, the Oil Pollution Act requires the owner or
operator of a tank vessel or a facility to maintain an emergency
oil response plan to respond to releases of oil or hazardous
substances. We have developed and implemented such a plan for
each of our facilities covered by the Oil Pollution Act. Also,
in case of such releases, the Oil Pollution Act requires
responsible companies to pay resulting removal costs and
damages, provides for substantial civil penalties, and imposes
criminal sanctions for violations of this law. The State of
Texas, in which we operate, has passed laws similar to the Oil
Pollution Act.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I><U>Ethanol and MTBE.</U></I> Ethanol and methyl tertiary
butyl ether, or MTBE, are the most commonly used oxygenated
blendstocks for producing cleaner-burning gasoline. However, the
presence of MTBE in some water supplies, resulting from gasoline
leaks primarily from underground and aboveground storage tanks,
has led to public concern that MTBE has contaminated drinking
water supplies, thus posing a health risk, or has adversely
affected the taste and odor of drinking water supplies. As a
result of heightened public concern, Congress and state
legislatures have either passed or proposed or are considering
proposals to restrict or ban the use of MTBE. We currently do
not blend ethanol or MTBE into our gasoline.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I><U>Resource Conservation and Recovery Act.</U></I> Our
refining operations are subject to RCRA requirements for the
treatment, storage and disposal of hazardous wastes. When
feasible, RCRA materials are recycled through our coking
operations instead of being disposed of
<FONT style="white-space: nowrap">on-site</FONT> or off-site.
RCRA establishes standards for the management of solid and
hazardous wastes. Besides governing current waste disposal
practices, RCRA also addresses the environmental effects of
certain past waste disposal operations, the recycling of wastes
and the regulation of underground storage tanks containing
regulated substances. In addition, new laws are being enacted
and regulations are being adopted by various regulatory agencies
on a continuing basis, and the costs of compliance with these
new rules can only be broadly appraised until their
implementation becomes more accurately defined.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I><U>Pipeline Regulation.</U></I> The Railroad Commission of
Texas, or RRC, has authority over some environmental matters
relating to our pipeline. Regulations promulgated by the RRC
address safety issues relating to the transportation of liquids,
and procedures for responding to and reporting releases of crude
oil.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">92

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Fuel Regulations.</I></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <U>Reformulated Fuels.</U> EPA regulations also require that
    reformulated gasoline and low-sulfur diesel intended for all
    on-road consumers be produced for ozone non-attainment areas.
    Expenditures necessary to comply with existing reformulated
    fuels regulations are primarily discretionary.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <U>Tier&nbsp;2 Motor Vehicle Emission Standards.</U> The
    EPA&#146;s Tier&nbsp;2 Motor Vehicle Emission Standards Final
    Rule for all passenger vehicles establishes standards for sulfur
    content in gasoline. These regulations mandate that the average
    sulfur content of gasoline produced at any refinery not exceed
    30 parts per million, or ppm, during any calendar year, and that
    no individual gallon of gasoline exceed 80&nbsp;ppm, by
    January&nbsp;1, 2006. The previous standard for maximum per
    gallon sulfur content was gradually reduced from 1000&nbsp;ppm,
    to 450&nbsp;ppm, to 300&nbsp;ppm. Sulfur reduction on this large
    scale is capital intensive for refineries. Generally, refineries
    that met the Small Business Administration definition of a
    &#147;small refiner&#148; (less than 155,000&nbsp;bpd throughput
    and employ less than 1,500 workers worldwide) and timely
    submitted applications to the EPA have until 2010 to comply. The
    previous owner of our refinery entered into a hardship waiver
    agreement with the EPA in November 2003, which allowed for the
    continued production of gasoline with per batch sulfur levels as
    high as 300 parts per million, and annual average sulfur levels
    not to exceed 156&nbsp;ppm, until December 2009. We entered into
    a gasoline sulfur compliance plan with the EPA in May 2005
    intended to allow for sufficient time to make the needed
    investments to produce gasoline complying with the new
    standards. Under this agreement, we may continue to produce
    gasoline with a maximum per gallon sulfur level of 300&nbsp;ppm,
    and an annual average sulfur level not to exceed 156&nbsp;ppm
    through November 2007, or through May 2008, depending on which
    of the two compliance strategies (set forth in the agreement) is
    utilized. Also, under this agreement, we are obligated to
    produce essentially all of our diesel fuel as ultra-low sulfur
    diesel (less than 15&nbsp;ppm) by June&nbsp;1, 2006.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    <U>Ultra-Low Sulfur Diesel Standards.</U> The EPA has also
    promulgated on-road diesel regulations, which require a 97%
    reduction in the sulfur content of diesel fuel sold for highway
    use by June&nbsp;1, 2006, with full compliance by
    January&nbsp;1, 2010. Additional regulations covering nonroad,
    locomotive and marine diesel have also been promulgated. As of
    March 2005, the refinery was able to produce approximately
    12,000&nbsp;bpd of ultra-low sulfur diesel. This diesel
    currently satisfies the requirements of both the EPA on-road
    diesel regulation and the Texas Commission on Environmental
    Quality&#146;s low emission diesel regulation (referred to as
    the &#147;TxLED&#148; program). Further investment is underway
    to allow for all of the refinery&#146;s diesel production to
    meet these new specifications by June 2006, as required by our
    gasoline sulfur compliance plan.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We expect to spend approximately $26.7&nbsp;million between 2006
and the end of 2007 to comply with the federal Clean Air Act
regulations requiring a reduction in sulfur content in gasoline
and diesel fuel. In addition, we expect to spend approximately
$14.3&nbsp;million for other environmental improvement projects
through 2010 including approximately $6.7&nbsp;million for
purchasing and installing a sulfur recovery unit and
approximately $3.0&nbsp;million for a new electrical substation
in part to comply with a proposed consent decree with the
U.S.&nbsp;Department of Justice and the EPA. Actual costs could,
however, significantly exceed current estimates. Finally, the
Texas Commission on Environmental Quality is in the process of
revising its TxLED regulations, and if the proposed rules are
adopted, we may incur increased compliance costs.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Permits.</I> Refining companies must obtain numerous permits
that impose strict regulations on various environmental and
safety matters in connection with oil refining. Once a permit
application is prepared and submitted to the regulatory agency,
it is subject to a completeness review, technical review and
public notice and comment period before it can be approved.
Regulatory authorities have considerable discretion in the
timing of the permit issuance and the public has rights to
comment on and otherwise engage in the permitting process,
including through intervention in the courts.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Storage and Sale of Gasoline&nbsp;&#151; Convenience
Stores.</I> Federal, state, and local regulatory agencies have
adopted regulations governing underground storage tanks, or
USTs, that require us to make certain expenditures for
compliance. In particular, at the federal level, the Resource
Conservation and Recovery Act, or RCRA, required the EPA to
establish a comprehensive regulatory program for the detection,
prevention and
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">93

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
cleanup of leaking USTs. The regulations governing USTs permit
states to develop, administer and enforce their own regulatory
programs, incorporating requirements which are at least as
stringent as the federal standards and are now largely delegated
to the states for implementation.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The EPA and most states have established requirements for:
(1)&nbsp;installing UST systems; (2)&nbsp;upgrading UST systems;
(3)&nbsp;taking corrective action in response to releases;
(4)&nbsp;closing UST systems; (5)&nbsp;keeping appropriate
records; and (6)&nbsp;maintaining evidence of financial
responsibility for taking corrective action and compensating
third parties for bodily injury and property damage resulting
from releases.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We maintain tank compliance through leak-detection systems,
primarily utilizing automatic tank gauging, but also utilizing
inventory control methods, statistical inventory reconciliation,
and interstitial monitoring for leak detection. All of the
systems in place are considered adequate methods of leak
detection.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>State Trust&nbsp;Funds.</I> All states in which we operate
UST systems have established trust funds for the sharing of
liabilities and the recovery and reimbursement of certain
cleanup costs incurred as a result of releases from UST systems.
These trust funds, in essence, provide insurance coverage for
the cleanup of environmental damages caused by the operation of
UST systems, are funded by a UST registration fee and a tax on
the wholesale purchase of motor fuels within each state. Each
trust fund differs by state but in general provides a
$1.0&nbsp;million cap per incident and a $1.0&nbsp;million cap
per third-party claim. We have paid UST registration fees and
gasoline taxes to each state where we operate to participate in
these trust programs.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Remediation Efforts&nbsp;&#151; Retail Fuel and
    Convenience Stores and Refinery.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under the Comprehensive Environmental Response, Compensation and
Liability Act, or CERCLA, RCRA and related state laws, certain
persons may be liable for the release or threatened release of
hazardous substances into the environment. These persons include
the current owner or operator of property where the release or
threatened release occurred, any persons who owned or operated
the property when the release occurred, and any persons who
arranged for the disposal of hazardous substances at the
property. Liability under CERCLA is strict, retroactive and, in
most cases involving the government as plaintiff is joint and
several, so that any responsible party may be liable for the
entire cost of investigating and remediating releases of
hazardous substances. As a practical matter, liability at most
CERCLA and similar sites is shared among all solvent potentially
responsible parties. The liability of a party is determined by
the cost of investigation and remediation, the portion of the
hazardous substance(s) the party contributed to the site, and
the number of solvent potentially responsible parties.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are currently the responsible party for active UST release
cases at 17 stores in Tennessee, Virginia, and Alabama. In
addition, we are the responsible party for active release cases
involving four stores we no longer own in Alabama. The 21
release cases are the only active release cases for which we are
currently the responsible party. Each of the 21 release cases
for which we are responsible have ongoing environmental
activities and budgets. Our current budget estimate for these 21
sites is $3.5&nbsp;million. We do not expect to have any further
liability on these 21 sites because either each respective state
fund deductible has been met or the expected liability has been
accrued by us.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The previous owner of the refinery had been engaged for many
years in the investigation and remediation of liquid
hydrocarbons and contaminated soil and groundwater at the
purchased facilities. Upon purchase of the facilities, we became
responsible and liable for the costs associated with the
continued investigation and remediation of known and unknown
impacted areas at the refinery. Although we currently are not
aware of any soil and groundwater contamination at the pipeline
locations requiring investigation or remediation, in the future,
it may become necessary to conduct assessments and remediation
efforts at pipeline locations including
<FONT style="white-space: nowrap">out-of</FONT>-service
gathering lines. In addition, we have identified and
self-reported certain other environmental matters subsequent to
our purchase of the refinery. Based upon environmental
evaluations performed by third parties subsequent to our
purchase of the Tyler refinery, we have also recorded an
environmental liability of approximately $7.9&nbsp;million at
the acquisition date for the estimated costs of environmental
remediation for our refinery and crude oil pipeline. Current and
future environmental regulations as well as other reportable
conditions are expected to require additional expenditures for
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">94

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
investigation and remediation, which may be significant.
Remediation of groundwater at the refinery is expected to
continue for the foreseeable future.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Environmental Indemnity.</I> In connection with our
April&nbsp;29, 2005 acquisition of our refinery, the previous
owner agreed, within prescribed limitations to indemnify us
against costs incurred in connection with certain retained
environmental liabilities. We cannot assure you, however, that
this indemnification arrangement will prove to be adequate to
shield us from such liabilities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Environmental Insurance.</I> We maintain environmental
pollution and legal liability policies for our retail segment,
which cover certain environmental risks at substantially all of
our retail fuel and convenience stores. In addition, we maintain
a legal liability policy, which covers certain claims and
cleanup costs related to our retail segment&#146;s fuel
transportation operations. We also maintain environmental
pollution policies for our refining segment, which cover certain
claims and cleanup costs for new and historical environmental
conditions associated with at our refinery (excluding, among
other things, cleanup costs for historical environmental
conditions at our refinery). To date, no claims have been made
under any of the policies.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Other Governmental Regulation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our business is subject to other laws and regulations including,
but not limited to, employment laws and regulations, regulations
governing the sale of alcohol and tobacco, minimum wage
requirements, working condition requirements, public
accessibility requirements, citizenship requirements and other
laws and regulations. A violation or change of these laws could
have a material adverse effect on our business, financial
condition and results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Sale of Alcoholic Beverages.</I> In areas where our
convenience stores are located, state or local laws limit the
hours of operation for the sale of certain products, the most
significant of which limit or govern the sale of alcoholic
beverages. State and local regulatory agencies have the
authority to approve, revoke, suspend or deny applications for
and renewals of permits and licenses relating to the sale of
alcoholic beverages and to impose various restrictions and
sanctions. In many states, retailers of alcoholic beverages have
been held responsible for damages caused by intoxicated
individuals who purchased alcoholic beverages from them. While
the potential exposure to us for damage claims as a seller of
alcoholic beverages is substantial, we have adopted employee
training procedures intended to minimize such exposure. In
addition, we maintain general liability insurance which may
mitigate the cost of any liability.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Lottery Licenses.</I> Many of our convenience stores sell
state sponsored lottery tickets and games. The sale, marketing
and display of such items are governed by the applicable
state&#146;s gaming laws or the regulations of the issuing state
entity.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Store Operations.</I> Our stores are subject to regulation by
federal agencies and to licensing and regulations by state and
local health, sanitation, safety, fire and other departments
relating to the development and operation of convenience stores,
including regulations relating to zoning and building
requirements and the preparation and sale of food. Difficulties
in obtaining or failures to obtain the required licenses or
approvals could delay or prevent the development of a new store
in a particular area.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>OSHA.</I> We are also subject to the requirements of the
Federal Occupational Safety and Health Act, or OSHA, and
comparable state statutes that regulate the protection of the
health and safety of workers. In addition, the OSHA hazard
communication standard requires that certain information be
maintained about hazardous materials used or produced in
operations and that this information be provided to employees,
state and local governments and citizens.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our operations are also subject to federal and state laws
governing such matters as wage rates, overtime, working
conditions and citizenship requirements. At the federal level,
there are proposals under consideration from time to time to
increase minimum wage rates and to introduce a system of
mandated health insurance which could affect our results of
operations.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">95

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Employees</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of September&nbsp;30, 2005, we had 2,436 employees, of which
2,031 were employed either full or part-time by our retail
segment, 223 were employed in our refining segment, and 182 were
employed in our corporate offices. As of December&nbsp;31, 2005,
149 of the operations and maintenance hourly employees at the
refinery and 11 truck drivers at the refinery were represented
by United Steel, Paper and Forestry, Rubber, Manufacturing,
Energy, Allied Industrial and Service Workers International
Union and its Local 202 and were covered by collective
bargaining agreements. None of our employees in our retail
segment or in our corporate offices are represented by a union.
We consider our relations with our employees to be satisfactory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Trade Names, Service Marks and Trademarks</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We regard our intellectual property as being an important factor
in the marketing of our retail fuel and convenience stores. We
own, have registered or applied for registration of a variety of
trade names, service marks and trademarks for use in our
business, including the following registrations and applications
issued by or filed with the United States Patent and Trademark
Office: MAPCO EXPRESS&nbsp;&#38;
Design<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
EAST
COAST<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
CAF&#201; EXPRESS FINEST COFFEE IN TOWN MAPCO&nbsp;&#38;
Design<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
GUARANTEED RIGHT! MAPCO EXPRESS&nbsp;&#38;
Design<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
DAVE&#146;S ALL AMERICAN HOT
DOGS<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
DELTA
EXPRESS<SUP style="font-size: 85%; vertical-align: text-top">&#174;</SUP>,
MAPCO
MART<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>,
FLEET
ADVANTAGE<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>
and GRILLE
MARX<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>.
While we do not have and have not applied for a federally
registered mark for DISCOUNT FOOD
MART<SUP style="font-size: 85%; vertical-align: text-top"><FONT style="font-variant:SMALL-CAPS">tm</FONT></SUP>,
we do claim common law trademark rights in the name. Our right
to use the &#147;MAPCO&#148; name is limited to the retail fuel
and convenience store industry. We are not otherwise aware of
any facts which would negatively impact our continuing use of
any of our trade names, service marks or trademarks.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Legal Proceedings</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the ordinary conduct of our business, we are subject to
periodic lawsuits, investigations and claims, including,
environmental claims and employee related matters. Although we
cannot predict with certainty the ultimate resolution of
lawsuits, investigations and claims asserted against us, we do
not believe that any currently pending legal proceeding or
proceedings to which we are a party will have a material adverse
effect on our business, financial condition or results of
operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Corporate Structure</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our corporate structure is as set forth in the following diagram:
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="g99350g9935010.gif" alt="(Delek U.S. Holdings, Inc.)">
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Delek U.S.&nbsp;Refining GP, LLC owns a 0.1% interest in Delek
Refining Ltd.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">96

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='113'></A>
</DIV>

<!-- link1 "MANAGEMENT" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>MANAGEMENT</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Executive Officers, Directors and Key Employees</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth the names, ages and positions of
each of our current directors and executive officers and certain
key employees holding positions with us, Delek Refining, Inc.,
our holding company subsidiary for our refining segment, and
MAPCO Express, Inc., our principal operating subsidiary for our
retail segment as of December&nbsp;31, 2005.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="43%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="47%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="left" nowrap><B>Name</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Age</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Position</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Executive Officers and Directors</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ezra Uzi Yemin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>37</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    President, Chief Executive Officer and Director</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lynwood Gregory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>55</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Senior Vice President</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Frederec Green</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President and Chief Operating Officer<BR>
    of Delek Refining, Inc.</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Edward Morgan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President and Treasurer</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Tony McLarty</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>48</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assi Ginzburg</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>30</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Paul Pierce</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>45</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President of Marketing<BR>
    of MAPCO Express, Inc.</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gabriel Last</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>59</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Director</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Asaf Bartfeld</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>53</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Director</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ronel Ben-Dov</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>37</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Director</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Zvi Greenfeld</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>59</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Director</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Key Employees</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    John Colling,&nbsp;Jr.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>49</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Treasurer of MAPCO Express, Inc. and Delek Refining, Inc.</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Scotty Creason</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>42</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Director of Information Technology of MAPCO Express, Inc. and
    Delek Refining Inc.</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Walter Franz</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>39</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Director of Pricing of MAPCO Express, Inc.</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Kent Thomas</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    General Counsel and Secretary</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Dana Young</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>45</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President of Real Estate of MAPCO Express, Inc.</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Set forth below is a brief description of the business
experience of our executive officers and directors listed above.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Ezra Uzi Yemin </I>has served as our chief executive officer
since June 2004 and as our president and a director since April
2001. Mr.&nbsp;Yemin also served as our treasurer from April
2001 to November 2003 and as our secretary from May 2001 to
August 2005. Mr.&nbsp;Yemin&#146;s duties include the
formulation of our policies and direction, oversight of top
executives, and overall responsibility for our operation and
performance. Prior to joining us, Mr.&nbsp;Yemin served from
2000 to 2001 as the chief financial officer of Delek&nbsp;&#150;
The Israel Fuel Corporation, Ltd., the second largest fuel
corporation in Israel and one of our affiliated entities.
Additionally, he spent two years with CLAL Insurance Company
Ltd., the largest insurance company in Israel and two years in
the Insurance Commissioner&#146;s Office of the Israel Ministry
of Finance.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Lynwood Gregory </I>is the chief operating officer for all of
our retail fuel and convenience store operations. He has served
as our senior vice president since November 2003 and has served
as the executive vice president and chief operating officer of
MAPCO Express, Inc. since November 2002. From April 2001 to
November 2002, Mr.&nbsp;Gregory served as a vice president of
operations of MAPCO Express, Inc. Mr.&nbsp;Gregory began his
employment with MAPCO Petroleum, Inc. in 1990 and served as
vice-president of operations and vice-president of marketing for
Williams Express, Inc. prior to our acquisition of the company.
Mr.&nbsp;Gregory
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">97

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
is a thirty-one year veteran of the retail fuel and convenience
store industry. His responsibilities have included all segments
of operations, marketing and food service.
Mr.&nbsp;Gregory&#146;s leadership and foresight helped create
our new convenience store concept, which brands a food concept
and enhanced merchandising with the fuel aspect of the business.
Prior to joining MAPCO Petroleum, Inc., Mr.&nbsp;Gregory spent
six years with Georgia Southern Oil, two years with Starvin
Marvin/ Globe Oil, and eight years with Crown Central Petroleum,
all in upper management/executive positions, developing their
presence in the Southeast.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Frederec Green </I>has served as vice president of Delek
Refining, Inc. since February 2005 and as its chief operating
officer since May 2005, and is the primary operational officer
for our refining and wholesale marketing operations. Prior to
joining us, from January 2004 to January 2005, Mr.&nbsp;Green
operated Green Energy Advisors LLC, an independent consulting
practice servicing commercial insurance carriers on petroleum
refining and electrical matters. Mr.&nbsp;Green has
18&nbsp;years experience in the refining industry working for
UOP&nbsp;LLC, a refinery technology licensing firm, from 1987 to
1990 and Murphy Oil USA, Inc., from 1990 to 2004, where he
served as a senior vice president during his last
six&nbsp;years. Mr.&nbsp;Green has experience ranging from crude
oil and feedstock supply, through all aspects of managing a
refining business to product trading, transportation and sales.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Edward Morgan </I>is our principal financial officer and has
served as our treasurer since November 2003 and as vice
president since February 2005. Mr.&nbsp;Morgan has also served
as a member of management of our subsidiaries and is currently
the chief financial officer of both MAPCO Express Inc. and Delek
Refining, Inc. with responsibility for all finance and
accounting matters, as well as our company&#146;s information
technology infrastructure. Prior to joining us in May 2002,
Mr.&nbsp;Morgan was a senior member of management with American
HomePatient, Inc., a provider of home health care services and
products, where he was the director of treasury operations from
1997 to May 2002. Prior to that, Mr.&nbsp;Morgan spent several
years as a certified public accountant at Deloitte and Touche,
LLP. Throughout his career, Mr.&nbsp;Morgan has been involved in
debt restructuring, acquisitions and divestitures.
Mr.&nbsp;Morgan is a member of the American Institute of
Certified Public Accountants, the Association for Financial
Professionals, and the Tennessee Society of Certified Public
Accountants. He serves on the board of directors for the Ronald
McDonald House of Tennessee charities and serves on the Retailer
Advisory Board for the Tennessee Education Lottery Corporation.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Tony McLarty </I>is our principal human resources officer and
has served as vice president since February 2005. He is a
23&nbsp;year veteran of the hospitality industry with a
multi-dimensional background and functional strengths ranging
from operations to administration. From August 1995 to September
2002, Mr.&nbsp;McLarty was the senior director of human
resources at Logan&#146;s Roadhouse, where his responsibilities
included the supervision of 7,600 employees and a variety of
positions in human resources, recruiting, training, operations
and administration. Prior to that, Mr.&nbsp;McLarty held
positions at Morison&#146;s Specialty Restaurants and Southern
Hospitality Corporation and has worked for both public and
private companies. Mr.&nbsp;McLarty also serves as a director of
Levy&#146;s Inc. and is active in several charitable
organizations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Assi Ginzburg </I>is our principal strategic planning officer
and has served as vice president since February 2005. Prior to
joining us in November 2004, Mr.&nbsp;Ginzburg served as a
financial advisor from July 2001 to March 2003 for Swary-Yohman
Financial Consultants, and from April 1999 to July 2001 for
Itzhak Swary Ltd., two consulting firms in Israel.
Mr.&nbsp;Ginzburg has been a member of the Israel Institute of
Certified Public Accountants since 2001 and served as trustee of
court for a large Israeli public company in 2003 and 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Paul Pierce </I>has served as vice president of marketing of
MAPCO Express, Inc. since September 2004. Prior to joining us,
Mr.&nbsp;Pierce was self-employed as a consultant from January
2004 through August 2004, developing convenience stores for
D&#38;D Oil, Inc. From 1997 to December 2003, he held executive
level positions at Golden Gallon, Inc., a convenience store
chain, where his responsibilities included managing all
merchandise sales, vendor negotiations and contracts, retail
pricing, advertising, imaging, store layouts and design,
budgeting and operations team oversight. Throughout his
20&nbsp;years in the retail fuel and convenience store industry,
he has held a variety of marketing roles that include vice
president of marketing, director of merchandising, field
marketing manager and director of advertising. In addition to
the positions listed above,
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">98

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
Mr.&nbsp;Pierce has been employed by Crown Central Petroleum
Corporation, Kangaroo, Inc., and Palmetto Merchandise, Inc.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Gabriel Last </I>has served as a director since January 2002.
Mr.&nbsp;Last has served as the chief executive officer of Delek
Group Ltd., our parent company from 2001 to 2003. From 1998 to
2001, Mr.&nbsp;Last served as general manager of the Insurance
Companies Union in Israel. In addition, since 2003,
Mr.&nbsp;Last has served as the chairman of the board of Delek
Group Ltd., our parent company, and currently serves on the
board of directors of several of our other affiliated entities,
including, Matav-Cable Systems Media Ltd. Mr.&nbsp;Last also
serves on the board of Sinel Industries Ltd., an unaffiliated
public company in Israel.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Asaf Bartfeld </I>has served as a director since January
2002. Mr.&nbsp;Bartfeld has served as the president and chief
executive officer of Delek Group Ltd. our parent company, since
September 2003. Since July 2001, he has served as general
manager of Delek Investments and Properties Ltd, one of our
affiliated entities. Mr.&nbsp;Bartfeld also serves on the board
of directors of several of our affiliated entities, including
Delek Group Ltd., our parent company, and Matav-Cable Systems
Media Ltd.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Ronel Ben-Dov </I>has served as a director since February
2005. Mr.&nbsp;Ben-Dov has served as the chief financial officer
and vice president of Delek Group Ltd., our parent company,
since May 2004. Prior to that, Mr.&nbsp;Ben-Dov was a partner at
Kost Forer Gabbay&nbsp;&#38; Kasierer, a member of the
Ernst&nbsp;&#38; Young global organization, from December 2003
to April 2004. From April 2000 to November 2003,
Mr.&nbsp;Ben-Dov served as a partner/manager at Luboshitz
Kasierer, which was affiliated with Arthur Andersen&nbsp;&#38;
Co. Soci&#232;t&#233; until 2002 and then became a member of the
Ernst&nbsp;&#38; Young global organization. Mr.&nbsp;Ben-Dov
also serves at a director of several of our affiliated entities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Zvi Greenfeld </I>has served as a director since October
2005. Mr.&nbsp;Greenfeld has served as the president of one of
our affiliated entities, Delek Drilling Management Ltd., since
1993, where he oversees that company&#146;s exploration and
production of natural gas in Israel. Mr.&nbsp;Greenfeld is the
principal of Greenfeld-Energy Consulting, Ltd. a company that
has provided consulting services to us since May 2005. He has
also been a consultant for Delek&nbsp;&#150; The Israel Fuel
Corporation Ltd., another affiliate, since 2002, advising senior
management on fuel purchases. From 1991 to 2002,
Mr.&nbsp;Greenfeld served as a vice president of
Delek&nbsp;&#150; The Israel Fuel Corporation Ltd., where among
other things he directed the building and renovation of retail
gas stations and managed quality control and fuel purchasing.
Additionally, Mr.&nbsp;Greenfeld serves as a director of several
of our affiliated entities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Set forth below is a brief description of the business
experience of our key employees listed above.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>John Colling,&nbsp;Jr.</I> has served as the treasurer of
MAPCO Express, Inc. and Delek Refining, Inc. since July 2005.
From November 2003 to July 2005, Mr.&nbsp;Colling was the
treasurer of Nu-kote&nbsp;International, Inc., a manufacturer
and distributor of ink and toner printer cartridges, and from
July 1990 to September 2003, Mr.&nbsp;Colling served as the vice
president and treasurer of Magnetek, Inc., a provider of digital
power and electronic products. As treasurer of those companies,
he was responsible for world-wide treasury activities including,
mergers and acquisitions, corporate finance transactions,
corporate risk management and financial planning.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Scotty Creason </I>has served as the director of information
technology for MAPCO Express, Inc. since December 2002 and for
Delek Refining, Inc. since February 2005. From April 2001 to
December 2002, Mr.&nbsp;Creason served as IT project manager of
MAPCO Express, Inc. Mr.&nbsp;Creason began his employment with
MAPCO Petroleum, Inc. in 1994 and has held the positions of
field engineer, developer, EDI coordinator, and IT project
manager. Mr.&nbsp;Creason was instrumental in designing,
developing and managing our current IT infrastructure and
systems, and has been an integral part of our mergers and
acquisitions team. Mr.&nbsp;Creason has over 20&nbsp;years of IT
experience in various industries including real estate and
manufacturing.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Walter Franz </I>joined MAPCO Express Inc. in May 2003 and
has served as the director of pricing since May 2004. Prior to
joining us, Mr.&nbsp;Franz worked in both the retail and
healthcare industries, where he had extensive background in
pricing, inventory management, merchandise planning and
analysis. From August 1997 to January 2002, Mr.&nbsp;Franz
worked for Service Merchandise Company, Inc., a retail company,
as manager of inventory control and as director of merchandise
planning and was responsible for the analysis
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">99

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
and planning of 34&nbsp;business units. From January 2002 to May
2003, Mr.&nbsp;Franz worked as director of inventory management
at Shop at Home, Inc. Throughout his career, Mr.&nbsp;Franz has
been involved in revenue and margin enhancement, strategic
planning and analysis and process improvement.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Kent Thomas </I>has served as our general counsel and
secretary since August 2005. Mr.&nbsp;Thomas has over nine years
experience practicing law in Nashville, Tennessee. Prior to
joining us, Mr.&nbsp;Thomas spent four years at the firm of
Colbert&nbsp;&#38; Winstead, PC, and the prior four years at the
Gordon Law Group PLC, both of Nashville, Tennessee, with a
practice focused on litigating employment, commercial and
copyright disputes and providing transactional representation in
the banking, transportation, entertainment, restaurant and
alcoholic beverage retail industries. Mr.&nbsp;Thomas serves as
an adjunct instructor in intellectual property and legal ethics
at Southeastern Career College.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Dana Young </I>has served as vice president of real estate of
MAPCO Express, Inc. since April 2005. His responsibilities
include overseeing the development of new stores, including site
selection, acquisition, design and construction, the maintenance
and renovation of existing stores and the disposition of
selected stores. Mr.&nbsp;Young has twenty-three years of real
estate development experience. From April 2003 to April 2005, he
served as senior vice president of Bank Atlantic, a financial
institution based in Florida, where he managed the corporate
real estate department. From January 2002 to April 2003,
Mr.&nbsp;Young served as president of Real Estate&nbsp;&#38;
Construction Management Associates, a full service real estate
consulting firm. From August 1999 to January 2002,
Mr.&nbsp;Young served as senior vice president of SouthTrust
Bank, where he managed their corporate real estate department.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Composition of the Board of Directors After This Offering</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our board of directors currently consists of five members, none
of which are independent directors. We are currently recruiting
independent directors to serve on our board of directors. In
compliance with the requirements of the Sarbanes-Oxley Act of
2002, the rules of the NYSE and SEC rules and regulations, a
majority of the directors on our audit committee will be
independent within 90&nbsp;days of listing on the NYSE and,
within one year of listing, this committee will be fully
independent.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The directors are elected at the annual meeting of stockholders.
Our directors hold office until the earlier of their death,
resignation or removal or until their successors have been
elected and qualified. There are no family relationships among
any of our directors or executive officers.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Controlled Company</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our board of directors has determined that we are a
&#147;controlled company&#148; for the purposes of
Section&nbsp;303A of the NYSE Listed Company Manual because
Delek Group Ltd. indirectly holds more than 50% of the voting
power of our company. Following this offering, we intend to
utilize some or all of the &#147;controlled company&#148;
exemptions of the NYSE corporate governance standards. These
exemptions will free us from the obligation to comply with
certain NYSE corporate governance requirements that would
otherwise require us, among other things, to have a board of
directors composed of a majority of independent directors, to
have a compensation committee composed of independent directors
and to have a nominating and corporate governance committee. We
do plan, however, to appoint at least one independent director
to the board prior to completion of this offering. See
&#147;Risk Factors&nbsp;&#151; Risks Related to Our Common Stock
and this Offering&#148;.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Committees of the Board of Directors</I></B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Audit Committee</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to the completion of this offering, we will establish an
audit committee comprised of three directors, at least one of
whom will be &#147;independent&#148; as defined under and
required by the federal securities laws and the NYSE rules.
Because this offering is our initial public offering, the NYSE
permits us to phase-in the independence of our audit committee.
Upon completion of this offering, we will be required to have
one independent audit committee member. We will be required to
have a majority of independent members
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">100

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
approximately 90&nbsp;days after the date of this prospectus and
to have all independent audit committee members approximately
one year after the date of this prospectus. We anticipate
that &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;will
be designated by our board of directors as the audit committee
&#147;financial expert&#148; (as defined in the applicable
regulations of the SEC). The audit committee will operate under
a written charter adopted by the board of directors which
reflects standards set forth in SEC regulations and NYSE rules.
The composition and responsibilities of the audit committee and
the attributes of its members, as reflected in the charter, are
intended to be in accordance with applicable requirements for
corporate audit committees. The charter will be reviewed, and
amended if necessary, on an annual basis. The full text of the
audit committee&#146;s charter will be available on our website
at www.delekus.com.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As will be set forth in more detail in the charter, the audit
committee will assist the board in fulfilling its oversight
responsibility relating to our financial statements and the
disclosure and financial reporting process, our system of
internal controls, our internal audit function, the
qualifications, independence and performance of our independent
auditors, compliance with our code of business conduct, and
ethics and legal and regulatory requirements. The audit
committee will have the sole authority to appoint, retain,
terminate, compensate and oversee the work of the independent
auditors, as well as to pre-approve all audit and non-audit
services to be provided by the independent auditors.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <I>Compensation Committee</I></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to the completion of this offering, we will establish a
compensation committee comprised of three directors. The
compensation committee will operate under a written charter
adopted by the board of directors. The committee will be
responsible for administering any incentive compensation plans,
equity-based compensation plans and other benefit plans and
making recommendations to the board of directors with respect to
such plans. Also, the committee will evaluate the chief
executive officer&#146;s performance, determine compensation
arrangements for all of our executive officers, including our
chief executive officer, and make recommendations to the board
of directors concerning compensation policies for us and our
subsidiaries.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>Compensation Committee Interlocks and Insider
Participation.</I> None of our executive officers serves as a
member of the compensation committee or board of directors of
any other entity that has an executive officer serving as a
member of our board of directors or compensation committee.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Director Compensation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We do not currently pay any director fees to any of our
directors. In conjunction with this offering, we will be adding
independent directors to our board of directors and plan to pay
our non-employee directors an annual cash fee of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;and
an additional fee of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
meeting attended. Each non-employee committee member will
receive a fee of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
committee meeting attended. In addition, our non-employee
directors will receive
annually&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;stock
options
and &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;restricted
stock units or restricted shares which will vest in equal
amounts over a four year period. We will also reimburse our
directors for all reasonable expenses incurred for attending
meetings and service on our board of directors. See
&#147;Management&nbsp;&#151; IPO Awards&#148; for information
regarding stock option and restricted stock unit awards to be
granted to non-employee directors in connection with this
offering.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">101

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Executive Compensation</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth information regarding
compensation awarded to, earned by, or paid to our president and
chief executive officer and our four other most highly
compensated executive officers for fiscal year 2005. We
sometimes refer to these executives as the &#147;named executive
officers&#148; elsewhere in this prospectus.
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Summary Compensation Table</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="51%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Annual Compensation</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>All Other</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Compensation</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2" align="left" nowrap><B>Name and Principal Position</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Salary($)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Bonus($)(1)(2)</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>($)(4)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR bgcolor="#CCEEFF">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ezra Uzi Yemin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR bgcolor="#CCEEFF">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    President and Chief Executive Officer</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>261,692</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>350,000</TD>
    <TD align="left" valign="bottom" nowrap>(3)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>49,323</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lynwood Gregory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Senior Vice President of Delek US</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>177,230</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>12,741</TD>
    <TD>&nbsp;</TD>
</TR>

<TR bgcolor="#CCEEFF">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Frederec Green</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR bgcolor="#CCEEFF">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Chief Operating Officer of Delek Refining</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>158,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$25,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$141</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Edward Morgan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President and Treasurer</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>11,622</TD>
    <TD>&nbsp;</TD>
</TR>

<TR bgcolor="#CCEEFF">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Tony McLarty</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR bgcolor="#CCEEFF">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Vice President</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>140,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>10,918</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Represents a one-time special bonus paid in May 2005 upon the
    completion of the Tyler refinery acquisition.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Annual bonuses for fiscal year 2005 have not yet been
    determined. It is our practice to evaluate the eligibility of
    officers for bonuses in March and make payments in April based
    on company and individual performance.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    Includes an additional $200,000 bonus paid on February&nbsp;6,
    2006.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    Includes the following payments for each named executive
    officers:</TD>
</TR>

</TABLE>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="28%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Premiums paid by us with</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Severance and</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Matching contributions to</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>respect to term life</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>vacation payments</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>our 401(k) plan</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>insurance policies</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>accrued in fiscal 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ezra Uzi Yemin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>13,182</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>36,000</TD>
    <TD align="left" valign="bottom" nowrap>(1)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lynwood Gregory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>12,600</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Frederec Green</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Edward Morgan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>11,481</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Tony McLarty</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>10,777</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    Includes $12,000 in accrued severance payments and $24,000 in
    unused accrued vacation days that are payable upon termination
    of employment. See &#147;&#151;&nbsp;Employment Agreement with
    President and Chief Executive Officer&#148;.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">102

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table shows information about the value of our
named executive officers&#146; unexercised options as of
December&nbsp;31, 2005. None of our named executive officers
exercised options in 2005.
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Aggregated Option Exercises in Last Fiscal Year and Fiscal
Year-End Option Values</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="40%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Number of Securities</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Value of Unexercised In-</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Underlying Unexercised</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>The-Money Options at</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Options at Fiscal Year End</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Fiscal Year End(1)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="left" nowrap><B>Name</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Exercisable</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Unexercisable</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Exercisable</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Unexercisable</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ezra Uzi Yemin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lynwood Gregory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Frederec Green</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Edward Morgan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Tony McLarty</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    The dollar values have been calculated by determining the
    difference between the fair market value of the securities
    underlying the options at December&nbsp;31, 2005 and the
    exercise prices of the options. Solely for purposes of
    determining the value of the options at December&nbsp;31, 2005
    we have assumed that the fair market value of the common stock
    issuable upon exercise of options was
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
    the assumed initial public offering price, which is the midpoint
    of the range set forth on the cover page of this prospectus,
    since our common stock was not traded on an established market
    prior to this offering. The above calculations for
    Mr.&nbsp;Yemin assume completion of this offering.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Employment Agreement with President and Chief Executive
Officer</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We and our subsidiary, MAPCO Express, entered into an employment
agreement with Ezra Uzi Yemin, our president and chief executive
officer, effective May&nbsp;1, 2004, which has been subsequently
amended. The amended agreement provides for Mr.&nbsp;Yemin to
serve as the president and chief executive officer of MAPCO
Express through April&nbsp;30, 2009, unless the agreement is
terminated earlier by any party for any reason upon
12&nbsp;months notice or Mr.&nbsp;Yemin&#146;s death.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Mr.&nbsp;Yemin is entitled to a base salary of $24,000&nbsp;per
month and is eligible to receive an annual performance bonus at
the sole discretion of our board of directors. Mr.&nbsp;Yemin
may participate in any benefit plans, policies, programs and
payroll practices that MAPCO Express makes available to other
employees. The employment agreement also entitles Mr.&nbsp;Yemin
to specified perquisites and other personal benefits.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to the employment agreement, Mr.&nbsp;Yemin has been
granted share purchase rights that permit him to purchase,
subject to certain vesting requirements, up
to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of our common stock, representing 5% of our shares outstanding
immediately prior to the completion of this offering. These
share purchase rights become exercisable, subject to vesting,
upon the completion of this offering, provided Mr.&nbsp;Yemin is
employed by MAPCO Express at the time. Under the applicable
vesting provisions, Mr.&nbsp;Yemin will be entitled to purchase
up to one-fifth of these shares for each year of his employment
(pro rated monthly) from May 2004 until the expiration of the
employment agreement in April 2009. Mr.&nbsp;Yemin may purchase
these shares at an exercise price of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share, which is based upon an assumed total market value of our
equity of $80.0&nbsp;million at May&nbsp;1, 2004, the date of
grant.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The share purchase rights terminate upon the earlier of
(i)&nbsp;the one-year anniversary of Mr.&nbsp;Yemin&#146;s
termination of employment for any reason or (ii) April&nbsp;30,
2010, the one-year anniversary of the expiration of his
employment agreement. If Mr.&nbsp;Yemin voluntarily terminates
his employment, he will be entitled to purchase 90% of any
unexercised share purchase rights which have vested as of the
date of such termination.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For information regarding the value of these share purchase
rights, see the table captioned &#147;Aggregated Option
Exercises in Last Fiscal Year and Fiscal Year-End Option
Values&#148; under &#147;Executive Compensation&#148; above. See
&#147;Management&#146;s Discussion and Analysis of Financial
Condition and Results of Operations&nbsp;&#151; Factors
Affecting Comparability&#148; for a discussion of the
anticipated effect of these share purchase rights and stock
options to be granted in connection with this offering on our
future results.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">103

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon the expiration of the employment agreement or its
termination by us, MAPCO Express or Mr.&nbsp;Yemin,
Mr.&nbsp;Yemin is entitled to a continuation of his base salary
for a period of one&nbsp;month. During any such salary
continuation period, if Mr.&nbsp;Yemin resides in the United
States, he will be entitled to continue to receive all of the
perquisites and other personal benefits provided for in the
agreement. If Mr.&nbsp;Yemin resides in Israel during any salary
continuation period, he will be entitled to specified
perquisites and other personal benefits. In the event that the
agreement is terminated by any party for any reason prior to its
expiration, Mr.&nbsp;Yemin will also be entitled to severance
payments of $1,000 for each full month of employment with MAPCO
Express or its affiliates from January 2005 through the date of
termination, and to payment for unused vacation days accrued
through the date of termination. Furthermore, in the event no
shares underlying the share purchase rights have been issued to
Mr.&nbsp;Yemin by April&nbsp;30, 2009, upon the earlier of
(i)&nbsp;termination of the agreement by any party for any
reason prior to its expiration or (ii)&nbsp;a change in control
(as defined in the agreement) of MAPCO Express, Mr.&nbsp;Yemin
will be entitled to receive an additional bonus payment not to
exceed $3.0&nbsp;million, if we meet specified pre-tax profit
targets. However, if Mr.&nbsp;Yemin voluntarily terminates his
employment prior to the issuance of shares underlying his share
purchase rights, he will be entitled to receive 90% of such
additional bonus payment or to purchase&nbsp;90% of any vested
and unexercised share purchase rights accrued or vested through
the date of such termination.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In the event that Mr.&nbsp;Yemin decides to sell any shares
purchased through the exercise of his share purchase rights to a
third party, MAPCO Express has an exclusive right of first
refusal to purchase the shares. Additionally, if
Mr.&nbsp;Yemin&#146;s employment agreement is terminated for any
reason, MAPCO Express has the right during the ten-day period
following the date of termination to purchase some or all of the
shares held by Mr.&nbsp;Yemin, if any, at a purchase price equal
to the fair market value of the shares.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Delek US Holdings, Inc. 2006 Long-Term Incentive Plan</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following contains a summary of the material terms of our
2006 long-term incentive plan, which will be adopted by our
board of directors and approved by our stockholder prior to the
closing of this offering. The plan will enable us to attract,
motivate, reward and retain key personnel through the grant of
equity and cash-based incentive awards. The plan permits us to
grant stock options, stock appreciation rights, restricted
stock, restricted stock units and other stock-based awards and
cash incentive awards to directors, officers, employees,
consultants and other individuals (including, advisory board
members) who perform services for us or our affiliates.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Generally, the compensation committee will administer the plan,
will have discretion to select the persons to whom awards will
be made under the plan and prescribe the terms and conditions of
each award under the plan. The board of directors also has the
power to administer the plan. With respect to the application of
the plan to non-employee directors, the board of directors will
have sole responsibility and authority for matters relating to
the grant and administration of awards. Subject to applicable
law, the compensation committee also has discretion to delegate
all or a portion of its authority under the plan.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Up
to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of our common stock may be issued under the plan (subject to
adjustment to reflect certain transactions and events specified
in the plan). Shares covered by the unexercised portion of an
award that terminates, expires or is canceled or settled in
cash, shares forfeited or repurchased under the plan, and shares
withheld or surrendered in order to pay the exercise or purchase
price under an award or to satisfy the tax withholding
obligations associated with the exercise, vesting or settlement
of an award will again become available for issuance under the
plan.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The compensation committee may grant stock options (including
non-qualified and incentive stock options) and stock
appreciation rights under the plan. A stock appreciation right
entitles the recipient to receive the excess of the fair market
value of a share of our common stock on the date of exercise
over the designated base price of the stock appreciation right.
The exercise price of an option and the base price of a stock
appreciation right will be determined by the compensation
committee, but may not be less than the fair market value of the
underlying shares on the date of grant. The compensation
committee will determine the term of each option and stock
appreciation right, but the maximum term of each option and
stock appreciation right will be ten years. Subject to this
limit, the times at which each will be exercisable and
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">104

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
provisions requiring forfeiture of unexercised options or stock
appreciation rights at or following termination of employment or
other service or upon the occurrence of other events generally
are fixed by the compensation committee. The methods by which
the exercise price of a stock option may be paid or deemed to be
paid and the form of such payment (including, cash, shares of
our common stock, and other awards) will be determined by the
compensation committee. The methods of exercise and settlement,
the form of consideration payable on settlement and other terms
of stock appreciation rights will be determined by the
compensation committee.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The compensation committee may also grant restricted stock and
restricted stock units under the plan. Prior to the end of the
restricted period, shares of restricted stock may not be
transferred, and will be forfeited in the event of termination
of employment or other service in specified circumstances. The
compensation committee will establish the length of the
restricted period for awards of restricted stock. Aside from the
risk of forfeiture and non-transferability, an award of
restricted stock entitles the recipient to the rights of a
holder of our common stock, including the right to vote the
shares and to receive dividends (subject to any mandatory
reinvestment or other requirements imposed by the compensation
committee).
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Restricted stock units confer upon the recipient the right to
receive shares of our common stock at the end of a specified
deferral or vesting period. The compensation committee will
establish any vesting requirements for restricted stock units
granted for continuing services. Prior to settlement, restricted
stock unit awards carry no voting or dividend rights or other
rights associated with ownership of our common stock, but
dividend equivalents will be paid or accrue unless otherwise
determined by the compensation committee.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The plan authorizes the compensation committee to grant short
term and long term cash incentive awards as well as other types
of awards that are denominated or payable in, valued in whole or
in part by reference to, or otherwise based on or related to our
common stock including, without limitation, stock bonuses,
dividend equivalents, convertible or exchangeable debt
securities, other rights convertible or exchangeable into our
common stock, purchase rights for our common stock, awards with
value and payment contingent upon our performance or the
performance of any of our business units or any other factors
designated by the compensation committee, and awards valued by
reference to the book value of our common stock or the value of
securities of or the performance of our subsidiaries or
affiliates or other business units and awards designed to comply
with or take advantage of other applicable local laws or
jurisdictions other than the United States. Cash incentive
awards, including annual incentive awards and long-term
incentive awards will be earned at such times, and under such
circumstances, including the degree of attainment of performance
goals or future service requirements as the compensation
committee may determine. The compensation committee will
determine the terms and conditions of all such awards.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless sooner terminated by the board of directors, the plan
shall expire on the tenth anniversary of the date of its
adoption by the board of directors. The board of directors may
amend or terminate the plan at any time, provided, however, that
no such action may adversely affect a holder&#146;s rights under
an outstanding award without the holder&#146;s written consent.
Any amendment to the plan that would increase the aggregate
number of shares of our common stock issuable under the plan,
that would modify the class of persons eligible to receive
awards under the plan or that would otherwise be required to be
approved by our stockholders under applicable law or the
requirements of any stock exchange or market upon which our
common stock may then be listed shall be subject to the approval
of our stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The plan is intended to constitute a plan described in Treasury
Regulation&nbsp;Section&nbsp;1.162-27(f)(1), pursuant to which
the deduction limits under Section&nbsp;162(m) of the Internal
Revenue Code do not apply during the applicable reliance period.
In general, the reliance period ends upon the earliest of:
(i)&nbsp;the expiration of the plan; (ii)&nbsp;the material
modification of the plan; (iii)&nbsp;the issuance of all
available stock and other compensation that has been allocated
under the plan; or (iv)&nbsp;the first stockholder meeting at
which directors are to be elected that occurs after the close of
the third calendar year in which we became publicly held.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">105

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>IPO Awards</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We plan to grant an aggregate
of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;stock
options upon the completion of this offering to certain officers
and employees and our non-employee directors under our 2006
long-term incentive plan, which options will have an exercise
price equal to the initial public offering price of our common
stock. In addition, we plan to award an aggregate
of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;restricted
stock units to certain officers and employees and our
non-employee directors upon the filing of a registration
statement on
Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT>
registering the shares of our common stock issuable under our
2006 long-term incentive plan, which
Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> we intend
to file 30&nbsp;days after the completion of this offering. The
stock options and restricted stock units will vest in annual
installments on the first four anniversaries of the date of
completion of this offering.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Our 401(k) Plan</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We sponsor a voluntary 401(k) Employee Retirement Savings Plan
for eligible employees administered by Fidelity Management Trust
Company. Employees must be at least 21&nbsp;years of age and
have one year of service with at least 1,000&nbsp;hours worked
to be eligible to participate in the plan. Employee
contributions are matched on a fully-vested basis by us up to a
maximum of 6% of eligible compensation.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">106

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='114'></A>
</DIV>

<!-- link1 "PRINCIPAL STOCKHOLDERS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PRINCIPAL STOCKHOLDERS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Beneficial Ownership of Our Common Stock</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth information regarding the
beneficial ownership of our common stock upon completion of this
offering by:
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    each person or entity who is known by us to beneficially own 5%
    or more of our outstanding common stock;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    each of our directors;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    each of our executive officers named in the Summary Compensation
    Table;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    all our directors and executive officers as a group.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The amounts and percentage of common stock beneficially owned
are reported on the basis of regulations of the SEC governing
the determination of beneficial ownership of securities. Under
the rules of the SEC, a person is deemed to be a
&#147;beneficial owner&#148; of a security if that person has or
shares &#147;voting power,&#148; which includes the power to
vote or to direct the voting of such security, or
&#147;investment power,&#148; which includes the power to
dispose of or to direct the disposition of such security. A
person is also deemed to be a beneficial owner of any securities
of which that person has a right to acquire beneficial ownership
within 60&nbsp;days. Under these rules, more than one person may
be deemed a beneficial owner of the same securities and a person
may be deemed a beneficial owner of securities as to which he
has no economic interest. The number of shares of common stock
outstanding used in calculating the percentage for each listed
person includes the shares of common stock underlying options or
share purchase rights held by such person that are, or within
60&nbsp;days after the date of this prospectus will become,
exercisable, but excludes shares of common stock underlying
options or share purchase rights held by any other person.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Except as indicated by footnote, the persons named in the table
have sole voting and investment power with respect to all shares
of common stock shown as beneficially owned by them, subject to
community property laws where applicable.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Percentage of beneficial ownership after the transaction is
based
on &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock outstanding at the completion of this offering.
The table assumes that the underwriters&#146; option to purchase
additional shares is not exercised and excludes any shares
purchased in this offering by the respective beneficial owners.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Unless otherwise indicated below, each person or entity has an
address in care of our principal executive offices at 830
Crescent Centre Drive, Suite&nbsp;300, Franklin, Tennessee 37067.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="49%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Before Offering</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>After Offering(1)</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Percentage of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Percentage of</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Shares</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Beneficially</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Beneficially</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Beneficially</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Beneficially</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD align="left" nowrap><B>Name of Beneficial Owners, Directors and Executive Officers</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owned</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owned</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owned</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owned</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Delek Group Ltd.(2)(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Yitzchak Sharon Teshuva(4)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Delek Petroleum Ltd.(2)(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Delek Hungary Holding Ltd.(2)(3)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ezra Uzi Yemin(5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lynwood Gregory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Frederec Green</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Edward Morgan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Tony McLarty</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gabriel Last</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Asaf Bartfeld</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Ronel Ben-Dov</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Zvi Greenfeld</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    All current directors and executive officers as a group
    (11&nbsp;persons)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">107

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(1)&nbsp;</TD>
    <TD align="left">
    The number of shares of common stock to be outstanding after the
    offering:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    gives effect to
    a &nbsp;&nbsp;&nbsp;&nbsp;<FONT style="white-space: nowrap">&nbsp;-for-one</FONT>
    stock split of our common stock, which will be effective
    immediately prior to this offering;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT>
    registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> we intend
    to file within 30&nbsp;days after the completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    assumes no exercise by the underwriters of their option to
    purchase up
    to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;additional
    shares of common stock from us if they sell more
    than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    in the offering.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>(2)&nbsp;</TD>
    <TD align="left">
    Delek Group Ltd. is the parent company of Delek Petroleum Ltd.,
    and Delek Petroleum Ltd. is the parent company of Delek Hungary
    Holding Ltd., the record owner of all of our outstanding shares
    of common stock prior to this offering. Each entity may
    therefore, be deemed to beneficially own the shares held by
    Delek Hungary Holding Ltd.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(3)&nbsp;</TD>
    <TD align="left">
    The address of Delek Group Ltd. and Delek Petroleum Ltd. is Bet
    Adar Building, 7 Giborei Israel Street, P.O.B. 8464, New
    Industrial Park, Natanya (South) 42504, Israel. The address of
    Delek Hungary Holding Ltd. is 1134 Budapest, Vaci ut 35, Hungary.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(4)&nbsp;</TD>
    <TD align="left">
    Mr.&nbsp;Teshuva beneficially owns 64.4% of the outstanding
    equity and voting ordinary shares of Delek Group Ltd. through
    two corporations that he controls. Mr.&nbsp;Teshuva may be
    deemed to be a beneficial owner of the common stock beneficially
    owned by Delek Group Ltd. Mr.&nbsp;Teshuva disclaims beneficial
    ownership of the common stock beneficially owned by Delek Group
    Ltd. pursuant to the rules promulgated under the Securities
    Exchange Act of 1934, as amended, or Exchange Act, except to the
    extent of his pecuniary interest therein. This information is as
    of January&nbsp;11, 2006, and is based on filings made by Delek
    Group Ltd. with the Israel Securities Authority.</TD>
</TR>

<TR>
    <TD style="font-size: 3pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>(5)&nbsp;</TD>
    <TD align="left">
    Consists
    of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    that Mr.&nbsp;Yemin has the right to purchase within
    60&nbsp;days of the date of this prospectus, assuming the
    completion of this offering.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">108

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='115'></A>
</DIV>

<!-- link1 "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>General</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Immediately prior to this offering, Delek Group Ltd. owned all
our outstanding shares of common stock through Delek Hungary
Holding Ltd., an indirect wholly-owned subsidiary. After this
offering, Delek Group Ltd., through Delek Hungary Holding Ltd.,
will own &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% of the outstanding
shares of our common stock. If the underwriters&#146; option to
purchase additional shares is exercised in full, immediately
following this offering, Delek Group Ltd., through Delek Hungary
Holding Ltd., will own &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;% of our
common shares. For as long as Delek Group Ltd., through Delek
Hungary Holding Ltd., continues to own shares of common stock
representing more than 50% of the total voting power of our
common stock, Delek Group Ltd. will continue to have the power
acting alone to approve any action requiring a vote of the
majority of our voting shares and to elect all of our directors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Equity Investment in EL-AD DELEK LLC</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Between June&nbsp;20, 2002 and December&nbsp;31, 2003, we were
the nominee of our affiliates Delek&nbsp;&#150; The Israel Fuel
Corporation Ltd. and Delek Motors Ltd., each a subsidiary of
Delek Group Ltd., with regard to a two-thirds membership
interest in another affiliate, El-Ad Delek LLC, a Delaware
limited liability company. The two-thirds membership interest in
El-Ad Delek LLC was beneficially owned in equal amounts by those
affiliates and held of record by us. El-Ad Delek LLC is
principally engaged in the ownership and charter operations of a
corporate aircraft based in New Jersey. During this period we
did not invest any amounts in this entity, did not exercise
control over this entity and were not entitled to any of the
economic benefits or risks of loss of ownership. On
December&nbsp;31, 2003, we agreed to terminate this nominee
arrangement so that Delek&nbsp;&#150; The Israel Fuel
Corporation Ltd. and Delek Motors Ltd. would become record, as
well as beneficial, owners of their respective one third
beneficially-owned interests in El-Ad Delek LLC held by us as
nominee.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We purchased the one-third interest owned by Delek&nbsp;&#150;
The Israel Fuel Corporation Ltd., pursuant to a purchase
agreement stated to be effective as of December&nbsp;31, 2003.
As consideration for the sale of the interest, we executed and
delivered to Delek&nbsp;&#150; The Israel Fuel Corporation Ltd.
a variable rate promissory note in the amount of approximately
$6.7&nbsp;million for which the entire principal balance and
interest was due in full on January&nbsp;1, 2009. The note bore
interest based on LIBOR plus 1.50%&nbsp;per year. In May 2004,
we agreed with Delek&nbsp;&#150; The Israel Fuel Corporation
Ltd., effective as of December&nbsp;31, 2003, to terminate the
purchase agreement, to cancel the variable rate promissory note,
and to rescind the sale of the one-third interest of
Delek&nbsp;&#150; The Israel Fuel Corporation Ltd. in El-Ad
Delek LLC.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Notes&nbsp;Payable to Related Parties</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the variable rate promissory note issued in
connection with the purchase of our membership interest in El-Ad
Delek LLC, we have issued the following promissory notes payable
to Delek&nbsp;&#151; The Israel Fuel Corporation Ltd. and Delek
Group Ltd., two of our affiliates.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On February&nbsp;26, 2003, to partially finance our purchase of
seven Tennessee convenience stores from Pilot Travel Centers,
LLC, we signed a promissory note payable to Delek&nbsp;&#150;
The Israel Fuel Corporation Ltd. in the amount of
$3.5&nbsp;million. The promissory note bore interest at a rate
of 4.0%&nbsp;per year. On August&nbsp;17, 2004, we modified the
maturity date of this note payable from August&nbsp;26, 2004 to
December&nbsp;31, 2005. On May&nbsp;24, 2005, we repaid all
interest and principal due under the note.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;28, 2004, to partially finance our purchase of
Williamson Oil Co., Inc., we signed a promissory note payable to
Delek&nbsp;&#150; The Israel Fuel Corporation Ltd. in the
principal amount of $25.0&nbsp;million. The note bears interest
at a rate of 6.30%&nbsp;per year with interest and principal
payments due upon maturity on April&nbsp;27, 2008. We intend to
use a portion of the net proceeds from this offering to repay
all interest and principal due under the note.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, to partially finance our purchase of our
refinery, we signed a note payable to Delek Group Ltd., in the
amount of $35.0&nbsp;million. The note bears interest at a rate
of 7.0%&nbsp;per year, which is due
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">109

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
and payable in semi-annual installments, commencing July&nbsp;1,
2007. The entire principal amount plus accrued and unpaid
interest is due upon maturity on April&nbsp;27, 2010. On
November&nbsp;23, 2005, we repaid $17.5&nbsp;million of the
principal and all accrued interest through that date under the
note. We intend to use a portion of the net proceeds from this
offering to repay all remaining principal and interest due under
the note.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Guarantees by Affiliates</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with a Credit Agreement with Bank of Leumi and
Bank Hapoalim BM that we entered into on July&nbsp;31, 2002, and
which was amended and restated on April&nbsp;28, 2004,
Delek&nbsp;&#150; The Israel Fuel Corporation Ltd. entered into
a limited guaranty in favor of Bank of Leumi and Bank Hapoalim
BM, the general terms of which required Delek&nbsp;&#150; The
Israel Fuel Corporation Ltd. to guaranty payment of a
significant portion of our obligation, if we were unable to
perform our payment obligations under the Credit Agreement. The
guaranty was to expire on the earlier of July&nbsp;1, 2011 or
the complete payment and satisfaction of all amounts outstanding
under the Credit Agreement. In May 2004, we agreed to pay
Delek&nbsp;&#151; The Israel Fuel Corporation Ltd. a fee for the
guaranty in the amount of $150,000&nbsp;per quarter and that the
payment of this fee would be effective retroactive to
July&nbsp;1, 2003. During June 2004, Delek&nbsp;&#150; The
Israel Fuel Corporation Ltd. agreed to terminate the fee
agreement effective April&nbsp;1, 2004, and subsequently, in
September 2004, agreed to forgive the guarantee fees earned for
the period July&nbsp;1, 2003 through March&nbsp;31, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with our April&nbsp;29, 2005, SunTrust ABL
revolver, Delek Group Ltd. executed a $5&nbsp;million guaranty
in favor of the lenders. In return, we agreed to pay Delek Group
Ltd. guarantee fees equal to 1.5%&nbsp;per year of the
guaranteed amount. The lenders terminated the guaranty on
October&nbsp;1, 2005. We are required to pay Delek Group Ltd.
prorated fees of $31,849 on or prior to March&nbsp;31, 2006 in
satisfaction of our obligations to it under the guaranty.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with our April&nbsp;26, 2005, $30.0&nbsp;million
promissory note issued to the Israel Discount Bank of New York
and our April&nbsp;27, 2005, $20.0&nbsp;million promissory note
issued to Bank Leumi USA, Delek Group Ltd. guaranteed certain of
our obligations to these lenders. In consideration of the
guaranties, we agreed to pay Delek Group Ltd. quarterly fees
equal to 1.5%&nbsp;per year of the principal amounts of
indebtedness outstanding as of the last business day of each
calendar quarter. We are required to pay the full amount of
guarantee fees payable for the year ended December&nbsp;31, 2005
(approximately $482,466) on or prior to March&nbsp;31, 2006. The
guarantee fees are payable quarterly commencing in the second
quarter of 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In June 2005, in connection with our refinery operations, Delek
Group Ltd. guaranteed certain of our obligations to a crude oil
supplier. In return, we agreed to pay Delek Group Ltd. guarantee
fees of $12,500&nbsp;per month for every calendar month during
the quarter in which we incur debt that is subject to the
guaranty. We are required to pay the full amount of guarantee
fees payable for the year ended December&nbsp;31, 2005
(approximately $62,466) on or prior to March&nbsp;31, 2006. The
guarantee fees are payable quarterly commencing in the second
quarter of 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In August 2005, in connection with forward contracts we entered
into with Citibank, N.A., an affiliate of Citigroup Global
Markets Inc., one of the underwriters of this offering, Delek
Group Ltd. guaranteed certain of our obligations up to
$25.0&nbsp;million to Citibank N.A. In consideration of that
guaranty, we agreed to pay Delek Group Ltd. quarterly fees based
on 1.5%&nbsp;per year of the average quarterly exposure to Delek
Group Ltd. as a result of our forward contract activities. This
guarantee was terminated effective as of January&nbsp;1, 2006.
We are required to pay the full amount of guarantee fees payable
for the year ended December&nbsp;31, 2005 (approximately
$14,324) on or prior to March&nbsp;31, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Since our inception, Delek&nbsp;&#150; The Israel Corporation
Ltd. has guaranteed certain of our fuel purchasing activities at
no charge to us. At December&nbsp;31, 2005, our obligations
supported by these guarantees approximated $4.0&nbsp;million. In
2003 and 2004, Delek&nbsp;&#150; The Israel Fuel Corporation
Ltd. issued letters of credit totaling $9.5&nbsp;million for our
benefit to support certain of our fuel purchases at no charge to
us. As of December&nbsp;31, 2005, these letters of credit
remained outstanding.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">110

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Loans to President and Chief Executive Officer</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On August&nbsp;20, 2004, we provided Mr.&nbsp;Yemin, our
president and chief executive officer, with an interest-free
loan in the amount of $100,000 in connection with his employment
agreement, which is due in full upon the termination of
Mr.&nbsp;Yemin&#146;s employment. On November&nbsp;14, 2005, in
connection with an amendment of Mr.&nbsp;Yemin&#146;s employment
agreement, we provided Mr.&nbsp;Yemin with an additional
interest free loan in the amount of $100,000, which is due in
full upon the termination of Mr.&nbsp;Yemin&#146;s employment.
As of December&nbsp;31, 2005, the full amount of both these
loans were outstanding. See &#147;Management&nbsp;&#151;
Employment Agreement with President and Chief Executive
Officer&#148;. These loans were repaid in full to us on
February&nbsp;7, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Consulting Agreement with Company Affiliated with Director</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of May&nbsp;1, 2005, we entered into a consulting agreement
with Greenfeld-Energy Consulting, Ltd., a company owned and
controlled by one of our directors, Zvi Greenfeld. Pursuant to
the consulting agreement we compensated Greenfeld-Energy
Consulting, Ltd. $7,150&nbsp;per month from May through August
2005 and $7,670 commencing September 2005, plus reasonable
expenses, for consulting services relating to the refining
industry performed personally by Mr.&nbsp;Greenfeld. The
agreement continues in effect until terminated by either party
upon six months advance notice to the other party. In 2005, we
paid $51,610 to Mr.&nbsp;Greenfeld under the consulting
agreement.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Management and Consulting Agreement with Delek Group Ltd.</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of January&nbsp;1, 2006, we entered into a management and
consulting agreement with Delek Group Ltd., pursuant to which
key management personnel of Delek Group Ltd. provide management
and consulting services to us, including matters relating to
long-term planning, operational issues and financing strategies.
The agreement has an initial term of one year and will continue
thereafter until either party terminates the agreement upon
30&nbsp;days&#146; advance notice. As compensation, the
agreement provides for payment to Delek Group Ltd. of $125,000
per calendar quarter payable within 90&nbsp;days of the end of
each quarter and reimbursement for reasonable out-of-pocket
costs and expenses incurred on our behalf.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">111

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='116'></A>
</DIV>

<!-- link1 "DESCRIPTION OF CAPITAL STOCK" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DESCRIPTION OF CAPITAL STOCK</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with this offering, we intend to amend and restate
our certificate of incorporation and bylaws and effect
a &nbsp;&nbsp;&nbsp;&nbsp;<FONT style="white-space: nowrap">&nbsp;-for-one</FONT>
stock split of our common stock. The following summary of our
capital stock does not relate to our current certificate or
bylaws, but rather is a description of our capital stock
pursuant to the amended and restated certificate of
incorporation and bylaws that will be in effect upon the
completion of this offering. This information does not purport
to be complete and is subject to, and qualified in its entirety
by reference to, the terms of our amended and restated
certificate of incorporation and amended and restated bylaws,
which will be included as exhibits to the registration statement
of which this prospectus forms a part, and the provisions of
applicable Delaware law, the state in which we are incorporated.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon the completion of this offering our authorized capital
stock will consist
of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares,
of
which &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
will be common stock, $0.01&nbsp;par value,
and &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
will be preferred stock,
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;par
value, the rights and preferences of which may be established
from time to time by our board of directors. Upon completion of
the offering there will
be &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock outstanding and no outstanding shares of
preferred stock.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Common Stock</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Holders of common stock are entitled to one vote for each share
held on all matters submitted to a vote of stockholders and do
not have cumulative voting rights in connection with the
election of directors. Accordingly, holders of a majority of the
shares of common stock entitled to vote in any election of
directors may elect all of the directors standing for election.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Subject to any preferential rights of any then outstanding
preferred stock, holders of common stock are entitled to receive
any dividends that may be declared by our board of directors out
of legally available funds. In the event of our liquidation,
dissolution or winding up, holders of common stock will be
entitled to receive proportionately any of our assets remaining
after the payment of liabilities and any preferential rights of
our preferred stock then outstanding.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Holders of common stock have no preemptive, subscription,
redemption or conversion rights. The outstanding shares of
common stock are, and the shares of common stock offered by us
in this offering, when issued, will be, validly issued, fully
paid and non-assessable. The rights, preferences and privileges
of holders of common stock will be subject to those of the
holders of any shares of our preferred stock we may issue in the
future.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Preferred Stock</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our board of directors may, from time to time, authorize the
issuance of one or more classes or series of preferred stock
without stockholder approval. Though, we have no current
intention to issue any shares of preferred stock, our
certificate of incorporation permits us to issue up
to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of preferred stock. Subject to the provisions of our certificate
of incorporation and limitations prescribed by law, our board of
directors is authorized to adopt resolutions to issue shares,
establish the number of shares, change the number of shares
constituting any series, and provide or change the voting
powers, designations, preferences and relative rights,
qualifications, limitations or restrictions on shares of our
preferred stock, including dividend rights, terms of redemption,
conversion rights and liquidation preferences, in each case
without any action or vote by our stockholders.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The issuance of preferred stock may adversely affect the rights
of our common stockholders by, among other things:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    restricting dividends on the common stock;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    diluting the voting power of the common stock;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    impairing the liquidation rights of the common stock;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    delaying or preventing a change in control without further
    action by the stockholders.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">112

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a result of these or other factors, the issuance of preferred
stock could have an adverse impact on the market price of our
common stock.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Anti-takeover Effects of Certain Provisions of Our
Certificate of Incorporation</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our certificate of incorporation contain provisions that could
make it more difficult to acquire control of our company by
means of a tender offer, open market purchases, a proxy contest
or otherwise. A description of these provisions is set forth
below.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Preferred Stock</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We believe that the availability of the preferred stock under
our certificate of incorporation provides us with flexibility in
addressing corporate issues that may arise. Having these
authorized shares available for issuance will allow us to issue
shares of preferred stock without the expense and delay of a
special stockholders&#146; meeting. The authorized shares of
preferred stock, as well as shares of common stock, will be
available for issuance without further action by our
stockholders, unless action is required by applicable law or the
rules of any stock exchange on which our securities may be
listed. The board of directors has the power, subject to
applicable law, to issue series of preferred stock that could,
depending on the terms of the series, impede the completion of a
merger, tender offer or other takeover attempt that some, or a
majority, of the stockholders might believe to be in their best
interests or in which stockholders might receive a premium for
their stock over the then prevailing market price of the stock.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Advanced Notice Procedure</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our bylaws provide an advance notice procedure for stockholders
to nominate director candidates for election or to bring
business before an annual meeting of stockholders, including
proposed nominations of persons for election to the board of
directors. Only persons nominated by, or at the direction of,
our board of directors or by a stockholder who has given proper
and timely notice to our secretary prior to the meeting, will be
eligible for election as a director. In addition, any proposed
business other than the nomination of persons for election to
our board of directors must constitute a proper matter for
stockholder action pursuant to the notice of meeting delivered
to us. For notice to be timely, it must be received by our
secretary not less than 60 nor more than 90 calendar days prior
to the first anniversary of the previous year&#146;s annual
meeting (or if the date of the annual meeting is advanced more
than 30 calendar days or delayed by more than 30 calendar days
from such anniversary date, not earlier than the
90th&nbsp;calendar day prior to such meeting or the
10th&nbsp;calendar day after public disclosure of the date of
such meeting is first made). These advance notice provisions may
have the effect of precluding the conduct of certain business at
a meeting if the proper procedures are not followed or may
discourage or deter a potential acquirer from conducting a
solicitation of proxies to elect its own slate of directors or
otherwise attempt to obtain control of us.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Special Meetings of Stockholders</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our bylaws provide that special meetings of stockholders may be
called only by our chairman of the board, president or secretary
after written request of a majority of our board of directors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Anti-Takeover Effects of Delaware Law</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;203 of the DGCL provides that, subject to
exceptions specified therein, an &#147;interested
stockholder&#148; of a Delaware corporation shall not engage in
any &#147;business combination,&#148; including general mergers
or consolidations or acquisitions of additional shares of the
corporation, with the corporation for a three-year period
following the time that such stockholder becomes an interested
stockholder unless:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    prior to such time, the board of directors of the corporation
    approved either the business combination or the transaction
    which resulted in the stockholder becoming an interested
    stockholder;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">113

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    upon consummation of the transaction which resulted in the
    stockholder becoming an &#147;interested stockholder,&#148; the
    interested stockholder owned at least 85% of the voting stock of
    the corporation outstanding at the time the transaction
    commenced (excluding specified shares);&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    on or subsequent to such time, the business combination is
    approved by the board of directors of the corporation and
    authorized at an annual or special meeting of stockholders, and
    not by written consent, by the affirmative vote of at least
    66<FONT style="font-size: 70%"><SUP>2</SUP></FONT>/<FONT style="font-size: 60%">3</FONT>%
    of the outstanding voting stock not owned by the interested
    stockholder.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under Section&nbsp;203, the restrictions described above also do
not apply to specified business combinations proposed by an
interested stockholder following the announcement or
notification of one of specified transactions involving the
corporation and a person who had not been an interested
stockholder during the previous three years or who became an
interested stockholder with the approval of a majority of the
corporation&#146;s directors, if such transaction is approved or
not opposed by a majority of the directors who were directors
prior to any person becoming an interested stockholder during
the previous three years or were recommended for election or
elected to succeed such directors by a majority of such
directors. The restrictions described above also do not apply to
specified business combinations with a person who is an
&#147;interested stockholder&#148; prior to the time when the
corporation&#146;s common stock is listed on a national
securities exchange, so these restrictions would not apply to a
business combination with any person who is a stockholder of
Delek US Holdings, Inc. prior to this offering.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Except as otherwise specified in Section&nbsp;203, an
&#147;interested stockholder&#148; is defined to include:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    any person that is the owner of 15% or more of the outstanding
    voting stock of the corporation, or is an affiliate or associate
    of the corporation and was the owner of 15% or more of the
    outstanding voting stock of the corporation at any time within
    three years immediately prior to the date of
    determination;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the affiliates and associates of any such person.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under some circumstances, Section&nbsp;203 makes it more
difficult for a person who is an interested stockholder to
effect various business combinations with us for a three-year
period.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Limitation on Liability and Indemnification Matters</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our certificate of incorporation limits the liability of
directors to the fullest extent permitted by Delaware law. The
effect of these provisions is to eliminate the rights of our
company and our stockholders, through stockholders&#146;
derivative suits on behalf of our company, to recover monetary
damages against a director for breach of fiduciary duty as a
director, including breaches resulting from grossly negligent
behavior. However, exculpation does not apply if the directors
acted in bad faith, knowingly or intentionally violated the law,
authorized illegal dividends or redemptions or derived an
improper benefit from their actions as directors. In addition,
our bylaws provide that we will indemnify our directors and
officers to the fullest extent permitted by Delaware law.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have entered into separate indemnification agreements with
each of our directors and executive officers that may be broader
than the specific indemnification provisions contained in the
DGCL. These indemnification agreements require us, among other
things, to indemnify our directors and officers against
liabilities that may arise by reason of their status or service
as directors or officers.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, we maintain directors&#146; and officers&#146;
liability insurance to provide our directors and officers with
insurance coverage for losses arising from claims based on
breaches of duty, negligence, errors and other wrongful acts.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
There is no currently pending material litigation or proceeding
involving any of our directors or officers for which
indemnification is sought.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">114

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Listing</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have applied to list our common stock on the NYSE under the
symbol
&#147;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Transfer Agent and Registrar</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The transfer agent and registrar for our common stock
is &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">115

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='117'></A>
</DIV>

<!-- link1 "SHARES ELIGIBLE FOR FUTURE SALE" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SHARES ELIGIBLE FOR FUTURE SALE</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to this offering, there was no market for our common
stock. We can make no predictions as to the effect, if any, that
sales of shares or the availability of shares for sale will have
on the market price prevailing from time to time. Nevertheless,
sales of significant amounts of our common stock in the public
market, or the perception that those sales may occur, could
adversely affect prevailing market prices and impair our future
ability to raise capital through the sale of our equity at a
time and price we deem appropriate.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon completion of this
offering, &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock will be outstanding. The number of shares of
common stock to be outstanding:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    gives effect to
    a &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-for-one
    stock split of our common stock, which will be effective
    immediately prior to this offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
    share;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT>
    registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> we intend
    to file within 30&nbsp;days after the completion of this
    offering;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    excludes &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    assumes no exercise by the underwriters of their option to
    purchase up
    to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;additional
    shares of common stock from us if they sell more
    than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
    in the offering.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Of these
shares, &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
(or in the event the underwriters&#146; option to purchase
additional shares is
exercised, &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares)
of our common stock sold in this offering will be freely
tradable without restriction under the Securities Act of 1933,
as amended, or Securities Act, except for any shares of our
common stock purchased by our &#147;affiliates,&#148; as that
term is defined in Rule&nbsp;144 under the Securities Act, which
would be subject to the limitations and restrictions described
below. The
remaining &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of our common stock outstanding upon completion of this offering
are deemed &#147;restricted shares,&#148; as that term is
defined under Rule&nbsp;144 of the Securities Act.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Restricted securities may be sold in the public market only if
registered or if they qualify for an exemption from registration
under Rule&nbsp;144 or 144(k) under the Securities Act, which
rules are described below.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Rule&nbsp;144</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In general, under Rule&nbsp;144 as currently in effect, a
person, or persons whose shares must be aggregated, who has
beneficially owned restricted shares of our common stock for at
least one year is entitled to sell within any three-month period
a number of shares that does not exceed the greater of the
following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    one percent of the number of shares of common stock then
    outstanding, which will equal approximately shares immediately
    after this offering,&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the average weekly trading volume of our common stock on the New
    York Stock Exchange during the four calendar weeks preceding the
    date of filing of a notice on Form&nbsp;144 with respect to the
    sale.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Sales under Rule&nbsp;144 are also generally subject to certain
manner of sale provisions and notice requirements and to the
availability of current public information about us.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">116

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Rule&nbsp;144(k)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under Rule&nbsp;144(k), a person, or persons whose shares must
be aggregated, who is not deemed to have been one of our
affiliates at any time during the 90&nbsp;days preceding a sale
and who has beneficially owned the shares proposed to be sold
for at least two years would be entitled to sell the shares
under Rule&nbsp;144(k) without complying with the manner of
sale, public information, volume limitations or notice or public
information requirements of Rule&nbsp;144. Therefore, unless
otherwise restricted, the shares eligible for sale under
Rule&nbsp;144(k) may be sold immediately upon the completion of
this offering. All of our shares outstanding prior to this
offering are held by an affiliate, and therefore will not be
saleable under Rule&nbsp;144(k) unless such stockholder ceases
to be an affiliate during the 90&nbsp;days preceding a sale, and
any such sale could be made only following expiration or waiver
of the <FONT style="white-space: nowrap">lock-up</FONT>
agreements referred to below.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<FONT style="white-space: nowrap"><B>Lock-up</FONT>
Agreements</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our officers and directors, Delek Hungary Holding Ltd. and Delek
Group Ltd. who will collectively hold after this
offering &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of common stock have agreed that they will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or
indirectly, any shares of our common stock or securities
convertible into or exchangeable or exercisable for any shares
of our common stock, enter into a transaction that would have
the same effect, or enter into any swap, hedge or other
arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of our common stock, whether
any of these transactions are to be settled by delivery of our
common stock or other securities, in cash or otherwise, or
publicly disclose the intention to make any offer, sale, pledge
or disposition, or to enter into any transaction, swap, hedge or
other arrangement, without, in each case, the prior written
consent of the representatives of the underwriters for a period
of 180&nbsp;days after the date of this prospectus.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Registration of Shares in Connection with Delek US Holdings,
Inc. 2006 Long-Term Incentive Plan and Share Purchase Rights</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We intend to file a registration statement on
Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> under the
Securities Act covering shares of common stock to be issued
pursuant to our 2006 long-term incentive plan and share purchase
rights held by our president and chief executive officer. Based
on the number of shares reserved for issuance under the 2006
long-term incentive plan and share purchase rights, the
registration statement would cover
approximately &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
in total, which
reflects &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
reserved under the 2006 long-term incentive plan
and &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
reserved pursuant to the share purchase rights. The registration
statement will become effective upon filing. Accordingly, shares
of common stock registered under the registration statement on
Form&nbsp;<FONT style="white-space: nowrap">S-8</FONT> will be
available for sale in the open market immediately, after
complying with Rule&nbsp;144 volume limitations applicable to
affiliates, with applicable
<FONT style="white-space: nowrap">lock-up</FONT> agreements, and
with the vesting requirements and restrictions on transfer
affecting any shares that are subject to restricted stock awards.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">117

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='118'></A>
</DIV>

<!-- link1 "MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS TO NON-U.S. HOLDERS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>MATERIAL UNITED STATES FEDERAL INCOME TAX</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSIDERATIONS TO
<FONT style="white-space: nowrap">NON-U.S.&nbsp;</FONT>HOLDERS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>General</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following is a summary of the material United States federal
income tax and estate tax considerations related to the
ownership and disposition of our common stock by a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
(as defined below). This summary is based on the Internal
Revenue Code of 1986, as amended, which we refer to as the
&#147;Code&#148;, existing and proposed Treasury regulations
promulgated under the Code and administrative and judicial
interpretations of the Code, all as of the date of this
prospectus and all of which are subject to change, possibly with
retroactive effect. The Internal Revenue Service is referred to
as &#147;IRS&#148; in this summary.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
This summary assumes that
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders
will hold shares of our common stock as capital assets within
the meaning of Section&nbsp;1221 of the Code. It does not
discuss all of the tax considerations that may be relevant to
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders
of our common stock in light of their particular circumstances
or to
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders
of common stock subject to special rules, such as financial
institutions, regulated investment companies, insurance
companies, pension funds, tax-exempt organizations, partnerships
or other pass-through entities, dealers in securities or
currencies, traders who elect to mark to market their securities
or persons holding the common stock as part of a hedging or
constructive sale transaction, &#147;straddle,&#148; conversion
transaction, or other integrated transaction. In addition, this
summary does not discuss any United States tax consequences to a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
that is a controlled foreign corporation, passive foreign
investment company, corporation that accumulates earnings to
avoid U.S.&nbsp;federal income tax, or a U.S.&nbsp;expatriate.
This summary does not address all aspects of United States
federal income and estate taxes and does not address any state,
local or <FONT style="white-space: nowrap">non-United</FONT>
States tax considerations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have not requested a ruling from the IRS on the tax
consequences of owning our common stock. As a result, the IRS
could disagree with portions of this discussion. Persons
considering the purchase of our common stock should consult with
their own tax advisors about the application of the United
States federal income tax laws to their particular situations,
as well as any tax considerations under other United States
federal tax laws, and the laws of any state, local or foreign
jurisdiction.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For purposes of this summary, a
<FONT style="white-space: nowrap">&#147;Non-U.S.&nbsp;</FONT>Holder&#148;
is a beneficial owner of common stock that is not, for United
States federal income tax purposes, any of the following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a citizen or individual resident of the United States;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a corporation, partnership or other entity treated as a
    corporation or partnership, created in or under the laws of the
    United States or of any political subdivision thereof;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    an estate the income of which is subject to United States
    federal income taxation regardless of its source;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    a trust if a court within the United States is able to exercise
    primary supervision over the administration of the trust and one
    or more U.S.&nbsp;persons have the authority to control all
    substantial decisions of the trust, or a trust that has a valid
    election in effect under applicable United States Treasury
    regulations to be treated as a U.S.&nbsp;person.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If an entity treated as a partnership for U.S.&nbsp;federal
income tax purposes holds shares of common stock, the tax
treatment of a partner will generally depend on the status of
the partner and upon the activity of the partnership. If you are
a partner of a partnership holding shares of common stock, we
suggest you consult your own tax advisor.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Distributions to
    <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Dividends paid to a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
that are not effectively connected with the conduct of a
U.S.&nbsp;trade or business of the
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
generally will be subject to U.S.&nbsp;federal withholding tax
at a 30% rate or, if an income tax treaty applies and certain
certification requirements are satisfied, a lower rate specified
by
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">118

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
the treaty.
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders
should consult their tax advisors regarding their entitlement to
benefits under a relevant tax treaty.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Withholding generally is imposed on the gross amount of a
distribution, regardless of whether we have sufficient earnings
and profits to cause the distribution to be a dividend for
U.S.&nbsp;federal income tax purposes. However, we may elect to
withhold on less than the gross amount of the distribution if we
determine that the distribution is not paid out of our current
or accumulated earnings and profits, based on our reasonable
estimates.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
may obtain a refund of any excess amounts withheld by filing an
appropriate claim for a refund together with the required
information with the IRS.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Dividends that are effectively connected with a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder&#146;s
conduct of a trade or business within the United States and, if
a tax treaty applies, attributable to a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder&#146;s
U.S.&nbsp;permanent establishment, are exempt from
U.S.&nbsp;federal withholding tax if the
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
furnishes to us or our paying agent the appropriate IRS form and
other applicable requirements are met. However, dividends exempt
from U.S.&nbsp;federal withholding tax because they are
&#147;effectively connected&#148; or attributable to a
U.S.&nbsp;permanent establishment under an applicable tax treaty
are subject to U.S.&nbsp;federal income tax on a net income
basis at the regular graduated U.S.&nbsp;federal income tax
rates. Any such effectively connected dividends received by a
foreign corporation may, under certain circumstances, be subject
to an additional &#147;branch profits tax&#148; at a 30% rate or
a lower rate specified by an applicable tax treaty.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Gain on Disposition of Common Stock by
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
generally will not be subject to U.S.&nbsp;federal income tax
with respect to gain recognized on a sale or other disposition
of our common stock unless one of the following applies:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    The gain is effectively connected with a
    <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder&#146;s
    conduct of a trade or business within the United States and, if
    a tax treaty applies, the gain is attributable to a
    <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder&#146;s
    U.S.&nbsp;permanent establishment. In such case, the
    <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
    will, unless an applicable tax treaty provides otherwise,
    generally be taxed on its net gain derived from the sale at
    regular graduated U.S.&nbsp;federal income tax rates, and in the
    case of a foreign corporation, may also be subject to the branch
    profits tax described above;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    A <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
    who is an individual holds our common stock as a capital asset,
    is present in the United States for 183 or more days in the
    taxable year of the sale or other disposition, and certain other
    conditions are met. In such a case, the
    <FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
    will be subject to a flat 30% tax on the gain derived from the
    sale, which may be offset by certain U.S.&nbsp;sourced capital
    losses;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    We are or have been a &#147;United States real property holding
    corporation&#148;, or &#147;USRPHC&#148;, for United States
    federal income tax purposes during specified periods.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Because of the real property and retail fuel and convenience
stores we own, we may be, or may become, a USRPHC. The
determination of whether we are a USRPHC is fact specific and
depends on the composition of our assets. Generally, a
corporation is a USRPHC if the fair market value of its
U.S.&nbsp;real property interests, as defined in the Code and
applicable regulations, equals or exceeds 50% of the aggregate
fair market value of its worldwide real property interests and
its other assets used or held for use in a trade or business.
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holders
will be subject to U.S.&nbsp;federal income tax with respect to
gain recognized on the sale, exchange or other disposition of
our common stock if we are, or were, a USRPHC at any time during
the shorter of the five-year period ending on the date of the
sale or other disposition and the period a
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>holder
held our common stock (the shorter period referred to as the
&#147;lookback period&#148;). However, if we are, have been, or
become, a USRPHC and our common stock is regularly traded on an
established securities market (such as the NYSE), only a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
who (actually or constructively) holds or held during the
lookback period more than five percent of our common stock would
be subject to U.S.&nbsp;federal income tax on a disposition of
our common stock.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">119

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
You are encouraged to consult your own tax advisor regarding our
possible status as a &#147;United States real property holding
corporation&#148; and its possible consequences in your
particular circumstances.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>U.S.&nbsp;Federal Estate Tax</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Common stock owned or treated as owned by an individual who is
not a citizen or resident of the United States, as specifically
defined for U.S.&nbsp;estate tax purposes, at the time of death
will be included in such holder&#146;s gross estate for
U.S.&nbsp;federal estate tax purposes, and may be subject to
U.S.&nbsp;federal estate tax unless an applicable estate tax
treaty provides otherwise.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Information Reporting and Backup Withholding Tax</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Generally, we must report annually to the IRS and to each
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
the amount of dividends paid to, and the tax withheld with
respect to, such
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder.
These reporting requirements apply regardless of whether
withholding was reduced or eliminated by an applicable tax
treaty. Copies of this information also may be made available
under the provisions of a specific tax treaty or agreement with
the tax authorities in the country in which the
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
resides or is established. In general, backup withholding will
not apply to dividends paid to a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder if
the holder has provided the required certification that it is a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
and neither we nor our paying agents have actual knowledge or
reason to know that the holder is a United States person. The
backup withholding rules generally do not apply to payments to
corporations, whether domestic or foreign.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under United States Treasury regulations, the payment of
proceeds from the disposition of our common stock by a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
made to or through a foreign office of a broker to its customer
generally is not subject to information reporting or backup
withholding. However, if the broker is a U.S.&nbsp;person, a
controlled foreign corporation for U.S.&nbsp;federal income tax
purposes, a foreign person 50% or more of whose gross income
from certain periods is effectively connected with a United
States trade or business, a foreign partnership engaged in a
United States trade or business or a foreign partnership with
significant United States ownership, then information reporting
(but not backup withholding) will be required, unless the broker
has in its records documentary evidence that the beneficial
owner of the payment is not a U.S.&nbsp;person or is otherwise
entitled to an exemption, and other applicable certification
requirements are met (and the broker has no actual knowledge or
reason to know to the contrary). Information reporting and
backup withholding generally will apply to proceeds of a
disposition of our common stock effected at a United States
office of any United States or foreign broker, unless the broker
has in its records documentary evidence that the beneficial
owner of the payment is not a U.S.&nbsp;person or is otherwise
entitled to an exemption, and other applicable certification
requirements are met (and the broker has no actual knowledge or
reason to know to the contrary).
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Backup withholding does not represent an additional income tax.
Any amounts withheld from a payment to a
<FONT style="white-space: nowrap">Non-U.S.&nbsp;</FONT>Holder
under the backup withholding rules will be allowed as a credit
against the holder&#146;s United States federal income tax
liability and may entitle the holder to a refund, provided that
the required information or returns are timely furnished by the
holder to the IRS.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>The foregoing discussion of certain U.S.&nbsp;federal income
and estate tax considerations is for general information only
and is not tax advice. Accordingly, each prospective investor
should consult with his own tax adviser regarding
U.S.&nbsp;federal, state, local and
<FONT style="white-space: nowrap">non-U.S.&nbsp;</FONT>income
and other tax consequences of the acquisition, holding and
disposing of our common stock.</B>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">120

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='119'></A>
</DIV>

<!-- link1 "UNDERWRITING" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>UNDERWRITING</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Lehman Brothers Inc. and Citigroup Global Markets Inc. are
acting as representatives of the underwriters. Under the terms
of an underwriting agreement, which is filed as an exhibit to
the registration statement, each of the underwriters named below
has severally, and not jointly, agreed to purchase from us the
respective number of shares of common stock shown opposite its
name below:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2" align="left" nowrap><B>Underwriters</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Number of Shares</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Lehman Brothers Inc.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Citigroup Global Markets Inc.&nbsp;</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriting agreement provides that the underwriters&#146;
obligation to purchase shares of our common stock depends on the
satisfaction of the conditions contained in the underwriting
agreement, including:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the obligation to purchase all of the shares of common stock
    offered hereby, if any of the shares are purchased;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the representations and warranties made by us to the
    underwriters are true;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    there is no material change in the financial markets;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    we deliver customary closing documents to the underwriters.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Discounts, Commissions and Expenses</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table summarizes the underwriting discounts and
commissions we will pay to the underwriters. These amounts are
shown assuming both no exercise and full exercise of the
underwriters&#146; option to purchase additional shares of our
common stock. The underwriting fee is the difference between the
initial price to the public and the amount the underwriters pay
to us for the shares.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="43%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Without Underwriters&#146;</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>With Underwriters&#146;</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Option</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Option</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    $ Per Share</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    $ Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The representatives of the underwriters have advised us that the
underwriters propose to offer the shares of our common stock
directly to the public at the initial public offering price on
the cover of this prospectus and to selected dealers, which may
include the underwriters, at such offering price less a selling
concession not in excess of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share. The underwriters may allow, and the selected dealers may
re-allow, a discount from the concession not in excess of
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per
share to other dealers. After this offering, the representatives
may change the offering price and other selling terms.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The expenses of the offering that are payable by us are
estimated to be
$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(excluding
underwriting discounts and commissions).
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Option to Purchase Additional Shares</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have granted the underwriters an option exercisable for
30&nbsp;days after the date of this prospectus to purchase, from
time to time, in whole or in part, up to an aggregate
of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of our common stock at the initial public offering price on the
cover of this prospectus less underwriting discounts and
commissions. This option may be exercised if the underwriters
sell more
than &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
in connection with this offering. To the extent that this option
is exercised, each underwriter will be obligated, subject to
certain conditions, to purchase its pro rata portion of these
additional shares based on the underwriter&#146;s percentage
underwriting commitment in this offering as indicated in the
table at the beginning of this Underwriting section.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">121

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Lock-Up Agreements</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We, Delek Group Ltd., Delek Hungary Holding, Ltd. and all of our
officers and directors have agreed that, without the prior
written consent of the representatives of the underwriters, we
and they will not, subject to some exceptions, and limited
extensions in certain circumstances, directly or indirectly,
offer, pledge, announce the intention to sell, sell, contract to
sell, sell an option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant
to purchase, or otherwise transfer or dispose of any common
stock of the company or any securities which may be converted
into or exchanged for any common stock or enter into any swap or
other agreement that transfers, in whole or in part, any of the
economic consequences of ownership of the common stock for a
period of 180&nbsp;days from the date of this prospectus other
than permitted transfers.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The <FONT style="white-space: nowrap">180-day</FONT> restricted
period described in the preceding paragraph will be extended if:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    during the last 17&nbsp;days of the
    <FONT style="white-space: nowrap">180-day</FONT> restricted
    period we issue an earnings release or announce material news or
    a material event, or we are notified in writing by the
    representatives of the underwriters that, in their reasonable
    judgment, a material event relating to us has occurred;&nbsp;or</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    prior to the expiration of the
    <FONT style="white-space: nowrap">180-day</FONT> restricted
    period, we announce that we will release earnings results during
    the <FONT style="white-space: nowrap">16-day</FONT> period
    beginning on the last day of the
    <FONT style="white-space: nowrap">180-day</FONT> period.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In either case, the restrictions described in the preceding
paragraph will continue to apply until the expiration of the
<FONT style="white-space: nowrap">180-day</FONT> period
beginning on the issuance of the earnings release or the
announcement of the material news or material event.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Lehman Brothers Inc. and Citigroup Global Markets Inc., in their
sole discretion, may release the common stock and other
securities subject to the lock-up agreements described above in
whole or in part at any time with or without notice. When
determining whether or not to release common stock and other
securities from lock-up agreements, Lehman Brothers Inc. and
Citigroup Global Markets Inc. will consider, among other
factors, the holder&#146;s reasons for requesting the release,
the number of shares of common stock and other securities for
which the release is being requested and market conditions at
the time.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Offering Price Determination</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to this offering, there has been no public market for our
common stock. The initial public offering price will be
negotiated between the representatives and us. In determining
the initial public offering price of our common stock, the
representatives will consider:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the history and prospects for the industry in which we compete;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    our financial information;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the ability of our management and our business potential and
    earning prospects;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the prevailing securities markets at the time of this
    offering;&nbsp;and</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    the recent market prices of, and the demand for, publicly traded
    shares of generally comparable companies.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Indemnification</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act and
liabilities incurred in connection with the directed share
program described below, and to contribute to payments that the
underwriters may be required to make for these liabilities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Directed Share Program</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At our request, the underwriters have reserved for sale at the
initial public offering price up
to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
offered hereby for officers, directors, employees and certain
other persons associated with us. The number of shares available
for sale to the general public will be reduced to the extent
such persons purchase
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">122

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
such reserved shares. Any reserved shares not so purchased will
be offered by the underwriters to the general public on the same
basis as the other shares offered hereby.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Stabilization, Short Positions and Penalty Bids</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The representatives may engage in stabilizing transactions,
short sales and purchases to cover positions created by short
sales, and penalty bids or purchases for the purpose of pegging,
fixing or maintaining the price of the common stock, in
accordance with Regulation&nbsp;M under the Exchange Act:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Stabilizing transactions permit bids to purchase the underlying
    security so long as the stabilizing bids do not exceed a
    specified maximum.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    A short position involves a sale by the underwriters of shares
    in excess of the number of shares the underwriters are obligated
    to purchase in the offering, which creates the syndicate short
    position. This short position may be either a covered short
    position or a naked short position. In a covered short position,
    the number of shares involved in the sales made by the
    underwriters in excess of the number of shares they are
    obligated to purchase is not greater than the number of shares
    that they may purchase by exercising their option to purchase
    additional shares. In a naked short position, the number of
    shares involved is greater than the number of shares in their
    option to purchase additional shares. The underwriters may close
    out any short position by either exercising their option to
    purchase additional shares and/or purchasing shares in the open
    market. In determining the source of shares to close out the
    short position, the underwriters will consider, among other
    things, the price of shares available for purchase in the open
    market as compared to the price at which they may purchase
    shares through their option to purchase additional shares. A
    naked short position is more likely to be created if the
    underwriters are concerned that there could be downward pressure
    on the price of the shares in the open market after pricing that
    could adversely affect investors who purchase in the offering.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Syndicate covering transactions involve purchases of the common
    stock in the open market after the distribution has been
    completed in order to cover syndicate short positions.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Penalty bids permit the representatives to reclaim a selling
    concession from a syndicate member when the common stock
    originally sold by the syndicate member is purchased in a
    stabilizing or syndicate covering transaction to cover syndicate
    short positions.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
These stabilizing transactions, syndicate covering transactions
and penalty bids may have the effect of raising or maintaining
the market price of our common stock or preventing or retarding
a decline in the market price of the common stock. As a result,
the price of the common stock may be higher than the price that
might otherwise exist in the open market. These transactions may
be effected on the NYSE or otherwise and, if commenced, may be
discontinued at any time.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Neither we nor any of the underwriters make any representation
or prediction as to the direction or magnitude of any effect
that the transactions described above may have on the price of
the common stock. In addition, neither we nor any of the
underwriters make any representation that the representatives
will engage in these stabilizing transactions or that any
transaction, once commenced, will not be discontinued without
notice.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Electronic Distribution</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A prospectus in electronic format may be made available by one
or more of the underwriters and/or selling group members
participating in this offering, or by their affiliates. In those
cases, prospective investors may view offering terms online and,
depending upon the particular underwriter or selling group
member, prospective investors may be allowed to place orders
online. The underwriters may agree with us to allocate a
specific number of shares for sale to online brokerage account
holders. Any such allocation for online distributions will be
made by the representatives on the same basis as other
allocations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Other than the prospectus in electronic format, the information
on any underwriter&#146;s or selling group member&#146;s website
and any information contained in any other website maintained by
an underwriter or
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">123

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
selling group member is not part of the prospectus or the
registration statement of which this prospectus forms a part,
has not been approved and/or endorsed by us or any underwriter
or selling group member in its capacity as underwriter or
selling group member and should not be relied upon by investors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Listing on New York Stock Exchange</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We intend to apply to list our common shares on the NYSE under
the symbol
&#147;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Discretionary Sales</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriters have informed us that they do not intend to
confirm sales to discretionary accounts that exceed 5% of the
total number of shares offered by them.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>Relationships</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Certain of the underwriters and their respective affiliates
have, from time to time, performed, and may in the future
perform, various financial advisory and investment banking
services for us or our affiliates, for which they received or
will receive customary fees and expenses. The underwriters and
their respective affiliates may, from time to time, engage in
transactions with or perform services for us in the ordinary
course of their business. Affiliates of Lehman Brothers Inc.
acted as lead arranger and as a lender in connection with the
amended and restated credit facility we entered into as of
April&nbsp;28, 2005. In the third quarter of 2005, an affiliate
of Citigroup Global Markets Inc. entered into certain forward
contracts with us. These contracts have since expired.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">124

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='120'></A>
</DIV>

<!-- link1 "LEGAL MATTERS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>LEGAL MATTERS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The validity of the shares of common stock offered by this
prospectus will be passed upon for us by Fulbright&nbsp;&#38;
Jaworski L.L.P., New York, New York. The underwriters have been
represented by Simpson Thacher&nbsp;&#38; Bartlett LLP, New
York, New York.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='121'></A>
</DIV>

<!-- link1 "CHANGE IN ACCOUNTANTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>CHANGE IN ACCOUNTANTS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Since the audit for the year ended December&nbsp;31, 2002, we
have engaged Ernst&nbsp;&#38; Young LLP to audit our
consolidated financial statements as of the end of each of our
fiscal years. In connection with this offering, Ernst&nbsp;&#38;
Young LLP informed us that, as the result of certain
relationships between our foreign parent company and Kost Forer
Gabbay&nbsp;&#38; Kasierer, a member firm of the
Ernst&nbsp;&#38; Young global organization, Ernst&nbsp;&#38;
Young LLP concluded that it did not meet the independence
requirements of
Rule&nbsp;<FONT style="white-space: nowrap">2-01(c)(iii)</FONT>
of Regulation&nbsp;<FONT style="white-space: nowrap">S-X</FONT>
in connection with our fiscal year ended December&nbsp;31, 2004.
Accordingly, on December&nbsp;13, 2005 we engaged Mayer Hoffman
McCann P.C. to re-audit our consolidated financial statements
for that period in order to satisfy the requirements of the SEC.
We have engaged Ernst&nbsp;&#38; Young LLP to audit our
consolidated financial statements for the year ending
December&nbsp;31, 2005 and Ernst&nbsp;&#38; Young LLP has
informed us that they meet applicable independence requirements
of the SEC in respect of our 2002, 2003 and 2005 fiscal years.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The reports of Ernst&nbsp;&#38; Young LLP on our consolidated
financial statements for the years ended December&nbsp;31, 2002
and 2003 did not contain an adverse opinion or a disclaimer of
opinion and were not qualified or modified as to uncertainty,
audit scope, or accounting principles. In connection with
Ernst&nbsp;&#38; Young LLP&#146;s audits of our consolidated
financial statements for the year ended December&nbsp;31, 2002
and 2003, there were no reportable events and no disagreements
with Ernst&nbsp;&#38; Young LLP on any matters of accounting
principles or practices, financial statement disclosure or
auditing scope and procedures, which, if not resolved to the
satisfaction of Ernst&nbsp;&#38; Young LLP would have caused
Ernst&nbsp;&#38; Young LLP to make reference to the matter in
their report. We have requested Ernst&nbsp;&#38; Young LLP to
furnish a letter addressed to the SEC stating whether it agrees
with the above statements. A copy of that letter confirming its
agreement is filed as an exhibit to the registration statement
of which this prospectus forms a part.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The report of Mayer Hoffman McCann P.C. on our consolidated
financial statements for the year ended December&nbsp;31, 2004
did not contain an adverse opinion or a disclaimer of opinion
and was not qualified or modified as to uncertainty, audit
scope, or accounting principles. In connection with Mayer
Hoffman McCann P.C.&#146;s audit of our consolidated financial
statement for the year ended December&nbsp;31, 2004, there were
no reportable events and no disagreements with Mayer Hoffman
McCann P.C. on any matters of accounting principles or
practices, financial statement disclosure or auditing scope and
procedures which, if not resolved to the satisfaction of Mayer
Hoffman McCann P.C. would have caused Mayer Hoffman McCann P.C.
to make reference to the matter in their report. We have
requested Mayer Hoffman McCann P.C. to furnish a letter
addressed to the SEC stating whether it agrees with the above
statements. A copy of that letter confirming its agreement is
filed as an exhibit to the registration statement of which this
prospectus forms a part.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='122'></A>
</DIV>

<!-- link1 "EXPERTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>EXPERTS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The consolidated financial statements of Delek US Holdings, Inc.
at December&nbsp;31, 2003, and for each of the two years then
ended, appearing in this prospectus and related registration
statement have been audited by Ernst&nbsp;&#38; Young LLP,
independent registered public accounting firm, and at
December&nbsp;31, 2004, and for the year then ended, by Mayer
Hoffman McCann P.C., independent registered public accounting
firm, as set forth in their respective reports thereon appearing
elsewhere in this prospectus, and are included in reliance upon
such reports given on the authority of such firms as experts in
accounting and auditing.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The combined financial statements of the Tyler Refinery and
McMurrey Pipeline (A Business Component of Crown Central
Petroleum Corporation) at December&nbsp;31, 2004 and 2003 and
for each of the three years in the period ended
December&nbsp;31, 2004, appearing in this prospectus and related
registration statement, have been audited by Ernst&nbsp;&#38;
Young LLP, independent auditors, as set forth in their report
thereon
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">125

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
appearing elsewhere in this prospectus, and are included in
reliance upon such report given on the authority of such firm as
experts in accounting and auditing.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The consolidated financial statements of Williamson Oil Co.,
Inc. as of and for the year ended November&nbsp;30, 2003,
appearing in this prospectus and related registration statement,
have been audited by Ernst&nbsp;&#38; Young LLP, independent
auditors, as set forth in their report thereon appearing
elsewhere in this prospectus, and are included in reliance upon
such report given on the authority of such firm as experts in
accounting and auditing.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='123'></A>
</DIV>

<!-- link1 "WHERE YOU CAN FIND MORE INFORMATION" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WHERE YOU CAN FIND MORE INFORMATION</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have filed with the SEC a registration statement on
Form&nbsp;<FONT style="white-space: nowrap">S-1</FONT> under the
Securities Act to register the shares offered by this
prospectus. The term &#147;registration statement&#148; means
the original registration statement and any and all amendments
thereto, including the schedules and exhibits to the original
registration statement or any amendment. This prospectus is part
of that registration statement. This prospectus does not contain
all of the information set forth in the registration statement
or the exhibits to the registration statement. For further
information with respect to us and the shares we are offering
pursuant to this prospectus, you should refer to the
registration statement and its exhibits. Statements contained in
this prospectus as to the contents of any contract, agreement or
other document referred to are not necessarily complete, and you
should refer to the copy of that contract or other documents
filed as an exhibit to the registration statement. You may read
or obtain a copy of the registration statement at the SEC&#146;s
public reference room at 100 F Street, N.E.,
Washington,&nbsp;D.C. 20549. You may obtain information on the
operation of the public reference room and their copy charges by
calling the SEC at
<FONT style="white-space: nowrap">1-800-SEC-0330.</FONT> The SEC
maintains a website that contains registration statements,
reports, proxy information statements and other information
regarding registrants that file electronically with the SEC. The
address of the website is http://www.sec.gov.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We are not yet subject to the information and periodic reporting
requirements of the Exchange Act. Upon completion of this
offering, we will become subject to such information and
periodic reporting requirements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We intend to furnish holders of the shares of common stock
offered in this offering with written annual reports containing
audited consolidated financial statements together with a report
by our independent certified public accountants, and make
available to our stockholders quarterly reports for the first
three quarters of each year containing unaudited interim
financial statements.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">126

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='124'></A>
</DIV>

<!-- link1 "GLOSSARY OF SELECTED TERMS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>GLOSSARY OF SELECTED TERMS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following are definitions of some of the terms we use to
describe our business and industry in this prospectus.
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Alkylation</B></TD>
    <TD></TD>
    <TD valign="top">
    A refining process for chemically combining isobutane with
    olefin hydrocarbons (e.g., propylene, butylene) through the
    control of temperature and pressure in the presence of an acid
    catalyst, usually sulfuric acid or hydrofluoric acid. The
    product, alkylate, an isoparaffin, has high octane value and is
    blended with motor and aviation gasoline to improve the
    antiknock value of the fuel.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Anode grade coke</B></TD>
    <TD></TD>
    <TD valign="top">
    Grade of petroleum coke from a delayed coker low in metals such
    as vanadium, nickel and iron that is suitable for making
    graphite anodes for the aluminum smelting industry. If the
    metals content does not qualify as anode grade coke, then the
    coke is generally known as fuel grade. The choice of whether a
    coke may qualify as anode or fuel grade is driven solely by the
    crude slate of the crude unit upstream of the coker and the
    metals contained therein.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Atmospheric column</B></TD>
    <TD></TD>
    <TD valign="top">
    Refinery unit operated at atmospheric pressure.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Barrel</B></TD>
    <TD></TD>
    <TD valign="top">
    Common unit of measure in the oil industry which equates to
    42&nbsp;U.S.&nbsp;gallons.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Blendstocks</B></TD>
    <TD></TD>
    <TD valign="top">
    Various hydrocarbon streams produced from crude oil, natural gas
    processing, partially refined products and additives, which when
    blended together produce finished gasoline and diesel fuel;
    these may include natural gasoline, FCC unit gasoline, ethanol,
    reformate or butane, among others.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Bpd</B></TD>
    <TD></TD>
    <TD valign="top">
    Barrels per day, normally calculated as an average figure over a
    longer period of time. In production terms, the number of
    barrels of crude oil produced from a well during a 24&nbsp;hour
    period; in refining terms, the number of barrels of crude oil
    input or refined petroleum products output by a refinery.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Catalytic cracking</B></TD>
    <TD></TD>
    <TD valign="top">
    The refining process of breaking down the larger, heavier, and
    more complex hydrocarbon molecules into simpler and lighter
    molecules. Catalytic cracking is accomplished by the use of a
    catalytic agent and is an effective process for increasing the
    yield of gasoline from crude oil. Catalytic cracking processes
    fresh feeds and recycled feeds.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="top">
    &#149;&nbsp;Fresh Feeds. Crude oil or petroleum distillates that
    are being fed to processing units for the first time.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="top">
    &#149;&nbsp;Recycled Feeds. Feeds that are continuously fed back
    for additional processing.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Complexity</B></TD>
    <TD></TD>
    <TD valign="top">
    Gasoline producing refineries are disaggregated according to
    refinery complexity. A &#147;complex&#148; refinery refers to a
    refinery with secondary heavy oil upgrading units downstream of
    atmospheric distillation. These secondary units include
    catalytic crackers, catalytic hydrocrackers and fluid or delayed
    cokers. A &#147;topping&#148; refinery refers to a refinery with
    no secondary heavy oil upgrading units. A &#147;moderate
    complexity refinery&#148; such as the Tyler refinery is
    characterized by its ability to produce a high</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">127

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="top">
    percentage of valuable transportation fuels (or conversely, a
    low percentage of products with values lower than the cost of
    crude oil), but without the ability to further refine these
    products into chemicals, petrochemicals, or other specialty
    products.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Crack spread</B></TD>
    <TD></TD>
    <TD valign="top">
    A simplified benchmark for refining margins that measures the
    difference between the price for light products and crude oil.
    For example, 5-3-2 crack spread is often referenced and
    represents the approximate gross margin resulting from
    processing one barrel of a benchmark crude oil into three fifths
    of a barrel of gasoline, and two fifths of a barrel of high
    sulfur diesel.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Crude oil</B></TD>
    <TD></TD>
    <TD valign="top">
    A mixture of hydrocarbons that exists in liquid phase in natural
    underground reservoirs and remains liquid at atmospheric
    pressure after passing through surface separating facilities.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Delayed coking</B></TD>
    <TD></TD>
    <TD valign="top">
    A process by which heavier crude oil fractions can be thermally
    decomposed under conditions of elevated temperatures to produce
    a mixture of lighter oils and petroleum coke. The light oils can
    be processed further in other refinery units to meet product
    specifications. The coke can be used either as a fuel or in
    other applications such as the manufacturing of steel or
    aluminum. Delayed coking is differentiated from fluid coking by
    the alternating services of coke drums for process or drill-out
    purposes.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Distillates</B></TD>
    <TD></TD>
    <TD valign="top">
    Primarily diesel fuel, kerosene and jet fuel.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>FCC (fluidized catalytic cracking)</B></TD>
    <TD></TD>
    <TD valign="top">
    Catalytic conversion of heavier and more complex hydrocarbons
    into lighter products and coke in a fluidized bed catalytic
    reactor with continuous catalyst regeneration. The light oils
    can be processed further in other refinery units to meet product
    specifications.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Feedstocks</B></TD>
    <TD></TD>
    <TD valign="top">
    Hydrocarbon compounds, such as crude oil and natural gas
    liquids, that are processed and/or blended into refined
    petroleum products.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Gathering lines</B></TD>
    <TD></TD>
    <TD valign="top">
    The pipes used to transport oil and gas from a producing field
    to the main transportation pipeline in the area.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Heavy oils</B></TD>
    <TD></TD>
    <TD valign="top">
    A general term for heavy fuel oils and residual fuel oil.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Henry Hub</B></TD>
    <TD></TD>
    <TD valign="top">
    The pricing point for natural gas futures contracts traded on
    the New York Mercantile Exchange (NYMEX).</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>High conversion refinery</B></TD>
    <TD></TD>
    <TD valign="top">
    Incorporates all the basic building blocks found in both the
    topping and hydroskimming refineries, and it also features gas
    oil conversion units such as catalytic cracking and
    hydrocracking units, olefin conversion units such as alkylation
    or polymerization units, and, frequently, coking units which
    process heavy oils and minimize or eliminate the production of
    residual fuels.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Hydrotreating</B></TD>
    <TD></TD>
    <TD valign="top">
    The process whereby feedstocks are placed into contact with
    hydrogen, under high pressure and at a high temperature, in the
    presence of a catalyst, to reduce the content of sulfur,
    nitrogen, metals, polyaromatics and olefins.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">128

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Independent refiner</B></TD>
    <TD></TD>
    <TD valign="top">
    A refiner that does not have crude oil exploration or production
    operations. An independent refiner purchases the crude oil used
    as feedstock in its refinery operations from third parties.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Isomerization</B></TD>
    <TD></TD>
    <TD valign="top">
    A refining process which alters the fundamental arrangement of
    atoms in the molecule without adding or removing anything from
    the original material. Used to convert normal butane into
    isobutane (C4), an alkylation process feedstock, and normal
    pentane and hexane into isopentane (C5) and isohexane (C6),
    high-octane gasoline components.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Jobber</B></TD>
    <TD></TD>
    <TD valign="top">
    A merchant who buys products (usually in bulk or lots) and then
    sells them to various retailers.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Long ton</B></TD>
    <TD></TD>
    <TD valign="top">
    2,240 lbs. (approximately 1,000 kg).</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Lundberg Survey</B></TD>
    <TD></TD>
    <TD valign="top">
    An independent market research company offering local and
    national coverage of fuel prices, fuel taxes, station population
    studies, and market shares.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Naphtha</B></TD>
    <TD></TD>
    <TD valign="top">
    A major constituent fractionated from crude oil during the
    refining process, also referred to as straight run gasoline,
    which is processed further in the naphtha hydrotreating unit,
    reformer unit and isomerization unit to increase octane or
    reduce vapor pressure.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>No 2 oil</B></TD>
    <TD></TD>
    <TD valign="top">
    A petroleum distillate that can be used as either a diesel fuel
    or a fuel oil.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="top">
    &#149;&nbsp;No.&nbsp;2 Diesel Fuel. It is used in high speed
    diesel engines that are generally operated under uniform speed
    and load conditions, such as those in railroad locomotives,
    trucks, and automobiles.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="top">
    &#149;&nbsp;No.&nbsp;2 Fuel Oil (Heating Oil). It is used in
    atomizing type burners for domestic heating or for moderate
    capacity commercial/industrial burner units.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Platt&#146;s</B></TD>
    <TD></TD>
    <TD valign="top">
    Platt&#146;s is an industry recognized source for news, market
    commentary, transaction information and benchmark pricing
    covering global energy, petrochemical and metals markets.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Refined petroleum products</B></TD>
    <TD></TD>
    <TD valign="top">
    Hydrocarbon compounds, such as gasoline, diesel fuel, jet fuel
    and residual fuel that are produced by a refinery.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Refinery grade propylene</B></TD>
    <TD></TD>
    <TD valign="top">
    A by-product of FCC, coking and visbreaking, comprised primarily
    of a blend of propylene and propane. The FCC Unit is by far the
    largest source of this material. Propylene is used internally in
    a refinery to manufacture gasoline via alkylation or
    polymerization or, in some cases, as fuel.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Reforming</B></TD>
    <TD></TD>
    <TD valign="top">
    The thermal or catalytic conversion of petroleum naphtha into
    more volatile products of higher octane number. It represents
    the total effect of numerous simultaneous reactions such as
    cracking, polymerization, dehydrogenation, and isomerization.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Regeneration</B></TD>
    <TD></TD>
    <TD valign="top">
    In a catalytic process the reactivation of the catalyst,
    sometimes done by burning off the coke deposits under carefully
    controlled conditions of temperature and oxygen content of the
    regeneration gas stream.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Short ton</B></TD>
    <TD></TD>
    <TD valign="top">
    2,000 lbs. (approximately 907kg).</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">129

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="28%"></TD>
    <TD width="1%"></TD>
    <TD width="71%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Slurry oil</B></TD>
    <TD></TD>
    <TD valign="top">
    Slurry oil is a heavy oil produced in the catalytic cracking
    process. Slurry oil is normally sold as a heavy industrial fuel
    or recycled back into the oil refining process to make other
    refined petroleum products such as diesel.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Sour crude oil</B></TD>
    <TD></TD>
    <TD valign="top">
    A crude oil that is relatively high in sulfur content, requiring
    additional processing to remove the sulfur.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Sweet crude oil</B></TD>
    <TD></TD>
    <TD valign="top">
    A crude oil that is relatively low in sulfur content, requiring
    less processing to remove the sulfur.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Throughput</B></TD>
    <TD></TD>
    <TD valign="top">
    The actual volume per day processed through a unit or a
    refinery, typically expressed in barrels per day.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Throughput capacity</B></TD>
    <TD></TD>
    <TD valign="top">
    The amount of crude oil that can be processed through a unit or
    a refinery, typically expressed in barrels per day. The design
    capacity per day of a refinery process unit.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Turnaround</B></TD>
    <TD></TD>
    <TD valign="top">
    A periodically required standard procedure to refurbish and
    maintain a refinery that involves the shutdown and inspection of
    major processing units and occurs every three to five years.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Utilization</B></TD>
    <TD></TD>
    <TD valign="top">
    Ratio of throughput to the design or throughput capacity of a
    unit or a refinery.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>WTI</B></TD>
    <TD></TD>
    <TD valign="top">
    West Texas Intermediate crude oil, a light, sweet crude oil,
    characterized by an API gravity between 38 and 40 and a sulfur
    content of less than 0.4 weight percent that is used as a
    benchmark for other crude oils.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">
    <B>Yield</B></TD>
    <TD></TD>
    <TD valign="top">
    The percentage of refined petroleum products that are produced
    from feedstocks.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">130

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>INDEX TO FINANCIAL STATEMENTS</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="81%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Page</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <B>Delek US Holdings, Inc.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Audited Consolidated Financial Statements</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#302'>Reports of Independent Registered Public
    Accounting Firms</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#303'>Consolidated Balance Sheets as of
    December&nbsp;31, 2003 and 2004</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-4</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#304'>Consolidated Statements of Operations for
    the years ended December&nbsp;31, 2002, 2003 and 2004</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-5</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#305'>Consolidated Statements of
    Shareholder&#146;s Equity for the years ended December&nbsp;31,
    2002, 2003 and 2004</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-6</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#306'>Consolidated Statements of Cash Flows for
    the years ended December&nbsp;31, 2002, 2003 and 2004</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-7</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#307'>Notes to Consolidated Financial
    Statements</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-8</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Condensed Consolidated Financial Statements (Unaudited)</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#309'>Condensed Consolidated Balance Sheet at
    September&nbsp;30, 2005 (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-28</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#310'>Condensed Consolidated Statements of
    Operations for the nine-months ended September&nbsp;30, 2005 and
    2004 (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-29</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#311'>Condensed Consolidated Statements of Cash
    Flows for the nine-months ended September&nbsp;30, 2005 and 2004
    (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#312'>Notes to Condensed Consolidated Financial
    Statements (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <B>Tyler Refinery and McMurrey Pipeline (A Business Component of
    Crown Central Petroleum Corporation)</B></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Audited Combined Financial Statements</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#315'>Report of Independent Auditors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-52</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#316'>Combined Balance Sheets as
    December&nbsp;31, 2004 and 2003</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-53</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#317'>Combined Statements of Operations for the
    years ended December&nbsp;31, 2004, 2003 and 2002</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#318'>Combined Statements of Changes in
    Owner&#146;s Net Investment for the years ended
    December&nbsp;31, 2004, 2003 and 2002.</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#319'>Combined Statements of Cash Flows for the
    years ended December&nbsp;31, 2004, 2003 and 2002</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#320'>Notes to Combined Financial Statements</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-57</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Condensed Combined Financial Statements (Unaudited)</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#322'>Condensed Consolidated Balance Sheets as of
    March&nbsp;31, 2005 and December&nbsp;31, 2004 (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-71</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#323'>Condensed Consolidated Statements of
    Operations for the three-months ended March&nbsp;31, 2005 and
    2004 (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-72</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#324'>Condensed Combined Statements of Cash Flows
    for the three-months ended March&nbsp;31, 2005 and 2004
    (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-73</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#325'>Notes to Condensed Combined Financial
    Statements (Unaudited)</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-74</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <B>Williamson Oil Co., Inc. and Subsidiaries</B></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Audited Consolidated Financial Statements</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#328'>Report of Independent Auditors</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-81</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#329'>Consolidated Balance Sheet as of
    November&nbsp;30, 2003</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-82</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#330'>Consolidated Statement of Operations for
    the year ended November&nbsp;30, 2003</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-83</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#331'>Consolidated Statement of
    Stockholder&#146;s Equity for the year ended November&nbsp;30,
    2003</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-84</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#332'>Consolidated Statement of Cash Flows for
    the year ended November&nbsp;30, 2003</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-85</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;<A HREF='#333'>Notes to Consolidated Financial
    Statements</A></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>F-86</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-1

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='302'></A>
</DIV>

<!-- link1 "REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
To the Board of Directors and Shareholder of <BR>
 Delek US Holdings, Inc.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have audited the accompanying consolidated balance sheet of
Delek US Holdings, Inc. and Subsidiaries (A Subsidiary of Delek
Group Ltd.) as of December&nbsp;31, 2003 and the related
consolidated statements of operations, changes in
shareholder&#146;s equity and cash flows for each of the two
years in the period then ended. These financial statements are
the responsibility of the Company&#146;s management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. We were not engaged to perform an
audit of the Company&#146;s internal control over financial
reporting. Our audit included consideration of internal control
over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of
the Company&#146;s internal control over financial reporting.
Accordingly we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by
management and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Delek US Holdings, Inc. and Subsidiaries
(A Subsidiary of Delek Group Ltd.) at December&nbsp;31, 2003 and
the consolidated results of their operations and their cash
flows for each of the two years in the period then ended, in
conformity with U.S.&nbsp;generally accepted accounting
principles.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="38%"></TD>
    <TD width="62%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    /s/ Ernst &#38; Young LLP</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Nashville, Tennessee
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
March&nbsp;16, 2004
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-2

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
To the Board of Directors and Shareholder of <BR>
 Delek US Holdings, Inc.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have audited the accompanying consolidated balance sheet of
Delek US Holdings, Inc. and Subsidiaries (A Subsidiary of Delek
Group Ltd.) as of December&nbsp;31, 2004, and the related
consolidated statements of operations, changes in
shareholder&#146;s equity, and cash flows for the year then
ended. These financial statements are the responsibility of the
Company&#146;s management. Our responsibility is to express an
opinion on these financial statements based on our audit. The
financial statements of Delek US Holdings, Inc. and Subsidiaries
as of December&nbsp;31, 2003, and for the years ended
December&nbsp;31, 2003 and 2002, were audited by other auditors
whose report dated March&nbsp;16, 2004, expressed an unqualified
opinion on those statements.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We conducted our audit in accordance with the standards of the
Public Company Accounting Oversight Board (United States). 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 audit provides a
reasonable basis for our opinion.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In our opinion, the 2004 financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Delek US Holdings, Inc. and Subsidiaries
as of December&nbsp;31, 2004, and the consolidated results of
their operations and their cash flows for the year then ended,
in conformity with U.S.&nbsp;generally accepted accounting
principles.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="38%"></TD>
    <TD width="62%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    /s/ Mayer Hoffman McCann P.C.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Plymouth Meeting, Pennsylvania <BR>
 January&nbsp;19, 2006
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-3

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='303'></A>
</DIV>

<!-- link1 "CONSOLIDATED BALANCE SHEETS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED BALANCE SHEETS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="69%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="11" align="center" valign="top">
    <B>ASSETS</B></TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current assets:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$18,907</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,106</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,087</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,210</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,199</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,307</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,552</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,471</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>46,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,094</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and equipment:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>156,129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>221,085</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less: accumulated depreciation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(19,591</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(31,792</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and equipment, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>136,538</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>189,293</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Restricted cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,043</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,717</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Non-compete agreements, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>749</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>649</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Goodwill</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60,627</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Equity investment in related party LLC</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,696</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note receivable from a related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,356</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,034</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$256,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$330,173</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="11">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="11" align="center" valign="top">
    <B>LIABILITIES AND SHAREHOLDER&#146;S EQUITY</B></TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$11,033</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$16,086</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fuel payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,570</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,454</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,756</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,516</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note payable to related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>389</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,312</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,561</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,340</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and sales taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,660</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,468</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other product taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,618</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued employee costs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,072</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,899</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued expenses and other current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,517</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,454</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,540</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>72,285</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Noncurrent liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt, net of current portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>145,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>154,701</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note payable to related party, net of current portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,696</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital lease obligations, net of current portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>227</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued lease liability</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,128</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,081</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred revenue, net of current portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>465</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,397</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred tax liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,704</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,728</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total noncurrent liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>159,793</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>202,134</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Shareholder&#146;s equity:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Common stock, $0.01&nbsp;par value, 3,000&nbsp;shares
    authorized, 100&nbsp;shares issued and outstanding</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Additional paid-in capital</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retained earnings</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,633</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total shareholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,421</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55,754</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and shareholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$256,754</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$330,173</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-4

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='304'></A>
</DIV>

<!-- link1 "CONSOLIDATED STATEMENTS OF OPERATIONS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED STATEMENTS OF OPERATIONS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="64%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$549,632</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$600,157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$857,899</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating costs and expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>460,337</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>500,181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>730,780</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Store operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,704</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>80,060</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,227</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,122</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,426</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,374</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gain on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>542,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>584,113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>837,438</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,592</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,044</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,461</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,059</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,210</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,330</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,996</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income (loss) before income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(738</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,465</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,333</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings (loss) per share</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(4,740</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$64,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$73,330</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average common shares and equivalents outstanding,<BR>
    basic and diluted</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-5

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='305'></A>
</DIV>

<!-- link1 "CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER&#146;S EQUITY" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER&#146;S
EQUITY</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>For the Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share data)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="43%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Common Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Additional</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Total</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Paid-In</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retained</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Shareholder&#146;s</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Amount</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Capital</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Earnings</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Equity</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Balance at December&nbsp;31, 2001</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>42,415</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Balance at December&nbsp;31, 2002</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>820</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,941</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,480</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Balance at December&nbsp;31, 2003</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,421</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,333</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Balance at December&nbsp;31, 2004</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$14,633</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>55,754</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-6

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='306'></A>
</DIV>

<!-- link1 "CONSOLIDATED STATEMENTS OF CASH FLOWS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED STATEMENTS OF CASH FLOWS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 8pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="57%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR>
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from operating activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income (loss)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,333</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjustments to reconcile net income (loss) to net cash provided
    by operating activities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,535</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,092</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,205</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(371</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,742</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,943</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>727</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gain on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(430</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(898</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Unrealized loss on fuel derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Changes in assets and liabilities, net of acquisitions:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,042</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,254</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,440</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(675</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>283</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,164</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(127</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(652</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(205</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>213</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(869</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,936</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,245</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,807</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest payable (including to related parties)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,289</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,467</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and sales taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>412</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>338</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other product taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(106</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(988</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued employee costs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued expenses and other current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>417</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,010</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>491</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,208</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>448</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>543</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24,926</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from investing activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchase of convenience stores, net of cash acquired</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,293</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,186</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(22,150</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchases of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(9,773</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(5,181</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(6,974</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from sale of convenience store assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,781</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash used in investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,066</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(16,149</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(27,343</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from financing activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from term notes to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net payments on short term promissory notes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(161,107</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from Credit Agreement&nbsp;&#151; Term Loans</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>158,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on Credit Agreement&nbsp;&#151; Term Loans</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(11,600</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(11,600</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net proceeds from (payments on) Credit Agreement&nbsp;&#151;
    Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,600</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(500</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from (payments on) Union Planters Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(9,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net proceeds from SunTrust Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,700</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net proceeds from SunTrust Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,527</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(318</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on notes payable&nbsp;&#151; Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(57</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(74</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Repayment of acquired debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(28,563</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in restricted cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,043</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,674</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Issuance of note receivable from a related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(100</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchase of interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,700</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,289</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred financing costs paid</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,258</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(542</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,993</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by (used in) financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,465</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,242</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,616</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,942</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,199</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents at beginning of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,968</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,965</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18,907</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents at end of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$10,965</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$18,907</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,106</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Supplemental disclosures of cash flow information:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash paid during the year for:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,433</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,739</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,969</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$190</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assets acquired via the issuance of notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$108</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="4" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Termination (acquisition)&nbsp;of equity investment in related
    party LLC and related debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(6,696</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,696</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="4">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-7

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='307'></A>
</DIV>

<!-- link1 "NOTES TO CONSOLIDATED FINANCIAL STATEMENTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the Years Ended
December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>1.</B></TD>
    <TD>
    <B>General</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Delek US Holdings, Inc., (Delek US or the Company) is the sole
shareholder of MAPCO Express, Inc. (Express), MAPCO Family
Centers, Inc. (Family Centers) and MAPCO Fleet, Inc. (Fleet)
(collectively the Subsidiaries). Delek US and Express were
incorporated during April 2001 in the State of Delaware. Family
Centers and Fleet were incorporated in the State of Delaware
during February 2003 and January 2004, respectively.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Delek US is principally engaged in the operation of 331 retail
convenience stores throughout the southeastern United States
(178 and 93 of which are located in Tennessee and Alabama,
respectively) as of December&nbsp;31, 2004. The retail
convenience stores, which primarily operate under the
Company&#146;s brand names &#147;MAPCO Express&#148;,
&#147;Discount Food Mart&#148; and &#147;East Coast&#148; as
well as other non-company proprietary brands, engage in the
retail marketing of gasoline, diesel fuel, other petroleum
products and convenience merchandise.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Delek US is a wholly-owned subsidiary of Delek Group Ltd. (Delek
Group) located in Tel-Aviv, Israel.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>2.</B></TD>
    <TD>
    <B>Accounting Policies</B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Principles of Consolidation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The consolidated financial statements relate to Delek US as of
December&nbsp;31, 2003 and 2004 and for the years ended
December&nbsp;31, 2002, 2003 and 2004. All significant
intercompany transactions and account balances have been
eliminated in consolidation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Cash and Cash Equivalents</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company maintains cash and cash equivalents in accounts with
financial institutions and retains nominal amounts of cash at
the convenience store locations as petty cash. All highly liquid
investments purchased with an original maturity of three months
or less are considered to be cash equivalents.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Accounts Receivable</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Accounts receivable primarily represent receivables related to
credit card sales, receivables from vendor promotions and trade
receivables generated in the ordinary course of business. The
Company has recorded an allowance for doubtful accounts related
to wholesale fuel trade receivables as of December&nbsp;31, 2004
in the amount of $180. All other accounts receivable amounts are
considered to be fully collectible. Accordingly, no additional
allowance has been established as of December&nbsp;31, 2003 and
2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Two credit card providers accounted for approximately 18% and
16% of the total outstanding accounts receivable balance as of
December&nbsp;31, 2003 and 2004, respectively. Additionally,
rebates from one vendor accounted for approximately 17% and 10%
of the total outstanding accounts receivable balance as of
December&nbsp;31, 2003 and 2004, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Inventory</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Inventory consists of gasoline, diesel fuel, other petroleum
products, cigarettes, beer, convenience merchandise and food
service merchandise. Fuel inventories are stated at the lower of
cost or market on a
<FONT style="white-space: nowrap">first-in,</FONT> first-out
(FIFO)&nbsp;basis. Non-fuel inventories are stated at estimated
cost as determined by the retail inventory method.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-8

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Property and Equipment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Assets acquired by the Company in conjunction with acquisitions
are recorded at estimated fair market value in accordance with
the purchase method of accounting as prescribed in Statement of
Financial Accounting Standards (SFAS)&nbsp;No.&nbsp;141,
<I>Business Combinations.</I> Other acquisitions of property and
equipment are carried at cost. Betterments, renewals and
extraordinary repairs that extend the life of the asset are
capitalized. Maintenance and repairs are charged to expense as
incurred. The Company owns certain fixed assets on leased
locations and depreciates these assets and asset improvements
over the lesser of management&#146;s estimated useful lives of
the asset or the remaining lease term.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation is computed using the straight-line method over
management&#146;s estimated useful lives of the related assets,
which are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>


<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Computer equipment and software</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Automobiles</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Furniture and fixtures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10-15&nbsp; years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Convenience store equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7-15&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other site (POS)&nbsp;improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8-40&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Building and building improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;144, <I>Accounting for the
Impairment or Disposal of Long-Lived Assets,</I> the Company
evaluates the realizability of property and equipment as events
occur that could indicate impairment using measurements such as
projected undiscounted operating cash flows from the respective
asset.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Restricted Cash</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At December&nbsp;31, 2003 and 2004, the Company maintained a
restricted cash balance totaling $1,218 and $2,482,
respectively, related to proceeds received from the disposition
of certain assets during 2003 and 2004. In accordance with the
Credit Agreement discussed in note&nbsp;9, the Company is
required to deposit proceeds received from the disposition of
assets into a cash collateral account until the proceeds can be
used to acquire replacement assets within a period not to exceed
twenty-four months subsequent to the disposition. In the event
replacement assets are not acquired within the twenty-four month
period, the proceeds must be applied to the outstanding
principal balance of the Term Loans.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the Union Planters Agreement discussed in
note&nbsp;9 required the Company to maintain $825 of cash and
cash equivalent deposits with the bank at all times that the
principal amount of the borrowings with the bank exceeded a
pre-identified threshold defined in the agreement. The Union
Planters Agreement was terminated as of April&nbsp;30, 2004 and
was replaced with the SunTrust Agreement discussed in
note&nbsp;9. The SunTrust Agreement requires the Company to
maintain a deposit of cash and cash equivalents as additional
collateral. The cash collateral requirements are reduced as
SunTrust perfects its security interest in assets owned by the
Company. Amounts classified as restricted under the SunTrust and
Union Planters Agreements at December&nbsp;31, 2003 and 2004
totaled $825 and $1,235, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Goodwill</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Goodwill is accounted for under the provisions of
SFAS&nbsp;No.&nbsp;142, <I>Goodwill and Other Intangible
Assets.</I> This statement addresses how intangible assets and
goodwill should be accounted for upon and after their
acquisition. Specifically, goodwill and intangible assets with
indefinite useful lives are not amortized but are subject to
annual impairment tests based on their estimated fair value. In
accordance with the provisions of
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-9

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
SFAS&nbsp;No.&nbsp;142, the Company performs its annual review
of impairment of goodwill in the fourth quarter by comparing the
carrying value of the applicable reporting unit to the fair
value of the reporting unit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the fair value is less than the carrying value, then the
Company measures potential impairment by assigning the assets
and liabilities of the Company to the reporting unit in a manner
similar to a purchase transaction, in accordance with the
provisions of SFAS&nbsp;No.&nbsp;141 and comparing the implied
fair value of goodwill to its carrying value.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Income Taxes</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income taxes are accounted for under the provisions of
SFAS&nbsp;No.&nbsp;109, <I>Accounting for Income Taxes.</I> This
statement generally requires the Company to record deferred
income taxes for the differences between the book and tax bases
of its assets and liabilities, which are measured using enacted
tax rates and laws that will be in effect when the differences
are expected to reverse. Deferred income tax expense or benefit
represents the net change during the year in the Company&#146;s
deferred income tax assets and liabilities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Earnings (Loss) Per Share</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Basic earnings (loss) per share (EPS)&nbsp;are computed by
dividing net income by the weighted average common shares
outstanding. As of December&nbsp;31, 2004, the share purchase
rights granted discussed in note&nbsp;11 were the only
potentially dilutive instruments. As the exercise of these share
purchase rights is contingent upon the completion of an initial
public offering, they are not considered potentially dilutive
until the initial public offering has been completed.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Stock-Based Compensation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company currently accounts for employee stock options under
the intrinsic method in accordance with Accounting Principles
Board Opinion (APB)&nbsp;No.&nbsp;25, <I>Accounting for Stock
Issued to Employees,</I> as permitted by SFAS&nbsp;No.&nbsp;123,
<I>Share-Based Payment.</I> SFAS&nbsp;123 requires the Company
to provide pro forma information regarding income per share as
if compensation cost for share purchase rights granted under the
employment agreement described in Note&nbsp;11, had been
determined in accordance with the fair value method. Since the
vesting of the share purchase rights is contingent on a future
event that is not currently considered probable, no share
purchase rights have vested and no pro forma compensation cost
is disclosed.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Fair Value of Financial Instruments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The fair values of financial instruments are estimated based
upon current market conditions and quoted market prices for the
same or similar instruments present as of December&nbsp;31, 2003
and 2004. Management estimates that book value approximates fair
value for all of the Company&#146;s assets and liabilities that
fall under the scope of SFAS&nbsp;No.&nbsp;107, <I>Disclosures
about Fair Value of Financial Instruments.</I>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A majority of the Company&#146;s debt and derivative financial
instruments outstanding at December&nbsp;31, 2003 and 2004, were
executed with a limited number of financial institutions. The
risk of counterparty default is limited to the unpaid portion of
amounts due to the Company pursuant to the terms of the
derivative agreements. The net amount due from these financial
institutions at December&nbsp;31, 2003 and 2004 totaled $359 and
$1,921, respectively, as discussed at note&nbsp;9.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-10

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Revenue Recognition</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Revenues for products sold are recorded at the point of sale
upon delivery of product, which is the point at which title to
the product is transferred, and when payment has either been
received or collection is reasonably assured.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company derives service revenue from the sale of lottery
tickets, money orders, car washes and other ancillary product
and service offerings. Service revenue and related costs are
recorded at gross amounts and net amounts, as appropriate, in
accordance with the provisions of Financial Accounting Standards
Board (FASB)&nbsp;Emerging Issues Task Force (EITF)&nbsp;99-19,
<I>Reporting Revenue Gross as a Principal Versus Net as an
Agent.</I> The Company records service revenue and related costs
at gross amounts when the Company is the primary obligor, is
subject to inventory risk, has latitude in establishing prices
and selecting suppliers, influences product or service
specifications, or has several but not all of these indicators.
The Company records service revenues net of costs when the
Company is not the primary obligor and does not possess other
indicators of gross reporting as discussed.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Advertising Costs</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<I>The Company expenses advertising costs as incurred.</I>
Advertising expense for the years ended December&nbsp;31, 2002,
2003 and 2004 totaled $1,569, $1,127 and $1,198, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Vendor Discounts and Deferred Revenue</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company receives cash discounts or cash payments from
certain vendors related to product promotions based upon factors
such as quantities purchased, quantities sold, merchandise
exclusivity, store space, etc. In accordance with
EITF&nbsp;<FONT style="white-space: nowrap">02-16,</FONT>
<I>Accounting by a Reseller for Consideration Received from a
Vendor</I>, the Company recognizes these amounts as a reduction
of inventory until the products are sold, at which time the
amounts are reflected as a reduction in cost of goods sold.
Certain of these amounts are received from vendors related to
agreements covering several periods. These amounts are initially
recorded as deferred revenue, are reclassified as a reduction in
inventory upon receipts of the products, and are subsequently
recognized as a reduction of cost of goods sold as the products
are sold.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company also receives advance payments from certain vendors
relating to non-inventory agreements. These amounts are recorded
as deferred revenue and are subsequently recognized in revenue
as earned.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Self-Insurance Reserves</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is primarily self-insured for employee medical,
workers&#146; compensation and general liability costs, with
varying limits of per claim and aggregate stop loss insurance
coverage that management considers adequate. The Company
maintains an accrual for these costs based on claims filed and
an estimate of claims incurred but not reported. The difference
between actual settlements and recorded accruals are recorded in
the period identified.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Comprehensive Income</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Comprehensive income for the years ended December&nbsp;31, 2002,
2003 and 2004 was equivalent to net income for the Company.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-11

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Operating Leases</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company leases land and buildings under various operating
lease arrangements, most of which provide the Company with the
option, after the initial lease term, to renew the leases. Some
of these lease arrangements include fixed rental rate increases,
while others include rental rate increases based upon such
factors as changes, if any, in defined inflationary indices.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;13, <I>Accounting for
Leases</I>, for all leases that include fixed rental rate
increases, the Company calculates the total rent expense for the
entire lease period, considering renewals for all periods for
which failure to renew the lease imposes economic penalty, and
records rental expense on a straight-line basis in the
accompanying consolidated statements of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Derivatives</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company records all derivative financial instruments, such
as interest rate swap agreements, interest rate cap agreements
and fuel related derivatives at estimated fair value regardless
of their intended use in accordance with the provisions of
SFAS&nbsp;No.&nbsp;133, <I>Accounting for Derivative Instruments
and Hedging Activities</I>, as amended and interpreted. Changes
in the fair value of the derivative instruments are recognized
periodically in operations as the Company has elected to not
comply with the hedging requirements of SFAS&nbsp;No.&nbsp;133
which allow such changes to be classified as other comprehensive
income. The Company obtains the fair value of all derivative
financial instruments on a monthly basis from third party
financial and brokerage institutions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In January 2003, the Company began entering into multiple fuel
related derivative transactions. As a result of these fuel
related derivative transactions, the Company recorded net
increases to cost of goods sold of $40 and $726 during the years
ended December&nbsp;31, 2003 and 2004, respectively. Such
amounts include both realized and unrealized gains and losses on
fuel related derivatives.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Use of Estimates</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could
differ from those estimates.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>New Accounting Pronouncements</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In January 2003, the FASB issued Interpretation No.
(FIN)&nbsp;46, <I>Consolidation of Variable Interest Entities,
an Interpretation of Accounting Research
Bulletin&nbsp;No.&nbsp;51</I>. In December 2003, the FASB issued
a revision of FIN&nbsp;46 (FIN&nbsp;46R), primarily to clarify
the required accounting for investments in variable interest
entities. FIN&nbsp;46R requires certain variable interest
entities to be consolidated by the primary beneficiary of the
entity if the equity investors in the entity do not have the
characteristics of a controlling financial interest or do not
have sufficient equity at risk for the entity to finance its
activities without additional subordinated financial support
from other parties. FIN&nbsp;46R was effective in 2004 for all
new variable interest entities created or acquired in 2004. For
variable interest entities created or acquired prior to 2004,
the provisions of FIN&nbsp;46R must be applied January&nbsp;1,
2005. The Company has no investments in or contractual
relationships with any variable interest entities. The adoption
of FIN&nbsp;46R for new variable interest entities did not
impact the consolidated financial statements as of
December&nbsp;31, 2004 and is not expected to impact the
Company&#146;s
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-12

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
future financial position or results of operations related to
the adoption of FIN&nbsp;46R for variable interest entities
created prior to 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004, the FASB issued SFAS&nbsp;No.&nbsp;123R,
<I>Share-Based Payment</I>, which requires expensing stock
options and other share-based compensation payments to employees
and supersedes SFAS&nbsp;No.&nbsp;123, which had allowed
companies to choose between expensing stock options or
presenting pro forma disclosure only. SFAS&nbsp;No.&nbsp;123R
requires all share-based payments to employees, including grants
of employee stock options, to be recognized in the income
statement based on their fair values. Pro forma disclosure is no
longer an alternative. This standard is effective for the
Company as of January&nbsp;1, 2006 and will apply to all awards
granted, modified, cancelled or repurchased after that date as
well as the unvested portion of prior awards. The Company will
apply SFAS&nbsp;123R prospectively to new awards and to awards
modified, repurchased or cancelled after January&nbsp;1, 2006 as
well as the unvested portion of prior awards. The impact of
adoption on the Company&#146;s financial position and results of
operations is still being evaluated.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In March of 2005, the FASB issued FIN&nbsp;47, <I>Accounting for
Conditional Retirement Obligations</I>, which requires companies
to recognize a liability for the fair value of a legal
obligation to perform asset-retirement activities that are
conditional on a future event, if the amount can be reasonably
estimated. FIN&nbsp;47 must be adopted by the Company by the end
of fiscal 2005. The impact of adoption on the Company&#146;s
financial position and results of operations is still being
evaluated.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In May 2005, the FASB issued SFAS&nbsp;No.&nbsp;154,
<I>Accounting Changes and Error Corrections&nbsp;&#151; a
replacement of APB Opinion No.&nbsp;20 and FASB Statement
No.&nbsp;3</I>. This statement changes the requirements for
accounting for and reporting a change in accounting principles
and applies to all voluntary changes in accounting principles.
It also applies to changes required by an accounting
pronouncement in the unusual instance that the pronouncement
does not include specific transition provisions. When a
pronouncement includes specific transition provisions, those
provisions should be followed. This statement requires
retrospective application to prior periods&#146; consolidated
financial statements of changes in accounting principles, unless
it is impracticable to determine either the period-specific
effects or the cumulative effect of change. This statement
becomes effective for fiscal years beginning after
December&nbsp;15, 2005. The Company does not expect the adoption
of the statement to have an impact on the Company&#146;s
financial position and results of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Reclassifications</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Certain amounts presented in the prior year consolidated
financial statements have been reclassified to conform with the
current year presentation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>3.</B></TD>
    <TD>
    <B>Acquisitions</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On February&nbsp;27, 2003, the Company entered into an asset
purchase agreement with Pilot Travel Centers to acquire certain
assets related to seven convenience stores located in Tennessee.
Total consideration paid for these assets approximated $11,885.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;21, 2003, the Company entered into an asset
purchase agreement with
<FONT style="white-space: nowrap">Tri-Cumberland,</FONT> Inc. to
acquire certain assets related to a convenience store located in
Tennessee. Total consideration paid for these assets
approximated $90.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;30, 2004, the Company completed a stock purchase
agreement with an individual (Seller) whereby the Company
acquired 100% of the issued and outstanding stock of WOC, an
Alabama corporation, which included operating assets, working
capital and related debt for 100 convenience stores located
primarily
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-13

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
in the state of Alabama. Of the 100 stores acquired, eleven are
owned by WOC but leased to and operated by unrelated third
parties. Thus, 89 stores are directly operated by WOC. The
acquisition included two wholly owned subsidiaries of WOC that
provide wholesale distribution of fuel and merchandise to
unrelated third parties and WOC operating stores. Total
consideration paid to the Seller in exchange for 100% of the
stock of WOC was $20,751.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the consideration paid as acquisition costs
mentioned above, the Company incurred and capitalized
approximately $232 and $2,412 in acquisition transaction costs
during 2003 and 2004, respectively. The allocation of the
aggregate purchase price of the 2003 and 2004 acquisitions is
summarized as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="75%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fixed assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$9,901</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$58,830</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>887</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,944</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,013</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,789</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Goodwill</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,391</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,659</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred tax liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(8,792</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assumed liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(18</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(42,280</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$12,207</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$23,163</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The above acquisitions were accounted for using the purchase
method of accounting, as prescribed in SFAS&nbsp;No.&nbsp;141
and the results of their operations have been included in the
consolidated statements of operations from the dates of
acquisition. The purchase price was allocated to the underlying
assets and liabilities based on their estimated relative fair
values. The final allocation of the 2004 purchase price is
subject to adjustments for a period not to exceed one year from
the consummation date specifically with respect to certain
liabilities accrued. The allocation period is intended to
differentiate between amounts that are determined as a result of
the identification and valuation process required by
SFAS&nbsp;No.&nbsp;141 for all assets acquired and liabilities
assumed and amounts that are determined because information that
was not previously obtainable becomes obtainable.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company consolidated WOC&#146;s results of operations
beginning April&nbsp;30, 2004. The unaudited pro forma
consolidated results of operations for the years ended
December&nbsp;31, 2003 and 2004 as if the WOC acquisition had
occurred on January&nbsp;1, of each year, respectively, are as
follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="75%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Unaudited)</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Revenues</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$818,582</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$976,590</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,099</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,057</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings per share</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,991</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,567</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-14

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>4.</B></TD>
    <TD>
    <B>Inventory</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Inventory balances as of December&nbsp;31, 2003 and 2004 are as
follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="77%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Merchandise</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>12,560</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>19,505</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fuel</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,639</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,802</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>19,199</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28,307</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
One merchandise vendor accounted for approximately 57%, 55% and
45% of total merchandise purchases during the years ended
December&nbsp;31, 2002, 2003 and 2004, respectively. One fuel
vendor accounted for approximately 57%, 56% and 50% of total
fuel purchases during the years ended December&nbsp;31, 2002,
2003 and 2004, respectively. The Company believes that other
sources of merchandise and fuel inventory are available from
sources other than from its current vendors, however, the cost
structure of such purchases from other vendors may be different.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>5.</B></TD>
    <TD>
    <B>Property and Equipment</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Property and equipment, at cost, consist of the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="75%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Land</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$33,087</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$43,181</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Building and building improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61,763</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>85,913</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other site (POS)&nbsp;improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>44,368</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65,627</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Furniture and fixtures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>307</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>307</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Convenience store equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,857</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,052</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Computer equipment and software</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,152</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,117</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Automobiles</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>595</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>888</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>156,129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>221,085</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less: accumulated depreciation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(19,591</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(31,792</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$136,538</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$189,293</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation expense for the years ended December&nbsp;31, 2002,
2003 and 2004 was $7,326, $8,684 and $12,274, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>6.</B></TD>
    <TD>
    <B>Non-Compete Agreements</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with an acquisition during 2001, the Company
entered into five separate non-compete agreements with key
personnel of the seller totaling $1,000. The individuals may not
compete within a ten-mile radius of the acquired stores for a
period of ten years. The Company amortizes the cost over the
term of
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-15

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
the agreements, or 120&nbsp;months. Non-compete agreements as of
December&nbsp;31, 2003 and 2004 consist of the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="79%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Non-compete agreements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accumulated amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(251</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(351</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$749</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$649</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Amortization expense on non-compete agreements was $100 for the
years ended December&nbsp;31, 2002, 2003 and 2004. Estimated
amortization expense for each of the next five fiscal years is
$100&nbsp;per year.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>7.</B></TD>
    <TD>
    <B>Goodwill</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Goodwill represents the excess of the aggregate purchase price
over the fair value of the identifiable net assets acquired. The
Company adopted the provisions of SFAS&nbsp;No.&nbsp;142
effective January&nbsp;1, 2002. Under SFAS&nbsp;No.&nbsp;142,
goodwill acquired in a purchase business combination is no
longer amortized. The Company recorded no goodwill amortization
expense for the years ended December&nbsp;31, 2002, 2003 and
2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The changes in the carrying amounts of goodwill (by reporting
unit) for the years ended December&nbsp;31, 2003 and 2004 are as
follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Balance as of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Acquisitions</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Balance as of</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>and</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Adjustments</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Nashville</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,420</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$23</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,443</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Memphis</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,894</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,894</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Virginia</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,922</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,922</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Family Centers</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,368</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,368</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$59,236</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,391</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,627</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Balance as of</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Acquisitions</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Balance as of</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>and</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Adjustments</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Nashville</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,443</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,443</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Memphis</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,894</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,894</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Virginia</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,922</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,922</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Family Centers&nbsp;&#151; Nashville</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,368</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,368</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Family Centers&nbsp;&#151; Alabama</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,659</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,659</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,627</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,659</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$65,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The provisions of SFAS&nbsp;No.&nbsp;142 require the Company to
perform an assessment of whether goodwill is impaired annually
unless other impairment indicators exist. Under the provisions
of SFAS&nbsp;No.&nbsp;142, this test for impairment is based
upon an evaluation of whether the reporting unit&#146;s carrying
amount exceeds its fair value. If the reporting unit&#146;s
carrying amount exceeds its fair value, the impairment test must
be completed by comparing the implied fair value of the
reporting unit&#146;s goodwill to its carrying amount.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-16

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company completed its annual goodwill impairment review
during 2002, 2003 and 2004. In performing the impairment
reviews, the Company estimated the fair values of the reporting
units using a multiple of expected future cash flows. Based on
the results of these reviews, no impairments were determined to
have occurred, and as a result, no charge was recorded in the
accompanying consolidated statements of operations during 2002,
2003 and 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>8.</B></TD>
    <TD>
    <B>Equity Investment in Related Party LLC</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Between June&nbsp;20, 2002 and December&nbsp;31, 2003, the
Company was the nominee of its affiliates Delek-The Israel Fuel
Corporation Ltd. (Delek Fuel) and Delek Motors Ltd. (Delek
Motors), each a subsidiary of Delek Group, with regard to a
two-thirds membership interest in another affiliate,
<FONT style="white-space: nowrap">El-Ad</FONT> Delek LLC
(Related Party LLC or the LLC), a Delaware limited liability
company. The two-thirds membership interest in the LLC was
beneficially owned in equal amounts by those affiliates and held
of record by the Company. The LLC is principally engaged in the
ownership and charter operations of a corporate aircraft based
in New Jersey. During this period the Company did not invest any
amounts in this entity, did not exercise control over this
entity and was not entitled to any of the economic benefits or
risks of loss of ownership. On December&nbsp;31, 2003, the
Company agreed to terminate this nominee arrangement so that
Delek Fuel and Delek Motors would become record, as well as
beneficial, owners of their respective one third
beneficially-owned interests in the LLC held by the Company as
nominee.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective December&nbsp;31, 2003, the Company purchased 33.3% of
the membership interest in the LLC, from Delek Fuel for $6,696.
The Company acquired the interest in the LLC from Delek Fuel by
issuing a variable rate promissory note payable of $6,696 for
which the entire principal balance and interest was due in full
on January&nbsp;1, 2009. The note bore interest based on LIBOR
plus 1.50%&nbsp;per year.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On May&nbsp;17, 2004, the Company and Delek Fuel agreed to
terminate this purchase and sale agreement and the related
promissory note payable to Delek Fuel effective
December&nbsp;31, 2003. In connection with terminating the
agreements effective December&nbsp;31, 2003, Delek Fuel agreed
to become solely responsible for all income and expense related
to the 33.3% membership interest in the LLC and to cancel the
related note payable as of January&nbsp;1, 2004. As such, there
are no equity earnings, income or expenses related to the LLC or
interest expense related to the note payable recorded within the
Company&#146;s consolidated financial statements for the year
ended December&nbsp;31, 2004.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-17

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>9.</B></TD>
    <TD>
    <B>Long-Term Obligations</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Outstanding borrowings under the Company&#146;s existing debt
instruments and capital lease obligations at December&nbsp;31,
2003 and 2004 are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="74%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$10,196</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$28,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Credit Agreement&nbsp;&#151; Term Loans&nbsp;(A and B)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>143,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>131,900</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Credit Agreement&nbsp;&#151; Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Union Planters Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SunTrust Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,700</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SunTrust Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,527</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>616</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>56</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>168,752</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>203,333</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,756</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(19,516</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note payable to related parties&nbsp;&#151; currently due</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,500</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,500</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of capital lease obligation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(389</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$152,496</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$179,928</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Notes&nbsp;Payable to Related Parties</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During February 2003, the Company signed a note payable with
Delek Group in the amount of $3,500. Proceeds from the note were
used in the February 2003 purchase of seven convenience stores
located in Tennessee discussed in note&nbsp;3. The note bears
interest at a rate of 4.0%&nbsp;per annum with interest and
principal payments due upon maturity. On August&nbsp;17, 2004,
the Company modified the maturity date of this note payable that
was originally due to mature on August&nbsp;26, 2004. The note
payable, after the modification, is due to mature on
December&nbsp;31, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On December&nbsp;31, 2003, the Company financed an equity
investment in a related party LLC through the issuance of a
variable rate promissory note with Delek in the amount of
$6,696, which was terminated effective January&nbsp;1, 2004
discussed in note&nbsp;8.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;28, 2004, the Company signed a note payable with
Delek Fuel in the amount of $25,000. Proceeds from the note were
used to partially fund the WOC purchase discussed in
note&nbsp;3. The note bears interest at a rate of 6.30%&nbsp;per
annum with interest and principal payments due upon maturity on
April&nbsp;27, 2008.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Credit Agreement&nbsp;&#151; Term Loans&nbsp;(A and B) and
    Revolver</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On July&nbsp;31, 2002, the Company entered into a Credit
Agreement with Bank of Leumi USA (Leumi) and Bank
Hapoalim&nbsp;BM (Hapoalim). Subsequently, during March of 2004
and again in April of 2004, the Company and the lenders executed
an amended and restated Credit Agreement (the Credit Agreement)
which among other things changed certain covenants of the
original agreement for 2004 and beyond. The Credit
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-18

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Agreement provided two term loans (Term&nbsp;A and Term&nbsp;B)
to the Company in the original principal amount totaling
$158,000 in aggregate, a portion of the proceeds of which were
used to pay off existing borrowings under two short-term
promissory notes. The term loans in the original and distinct
principal amounts of $116,000 and $42,000 mature on July&nbsp;1,
2011 (Term&nbsp;A) and July&nbsp;1, 2007 (Term&nbsp;B),
respectively. The Term A loan is subject to mandatory reductions
in principal over its term and bears interest, payable
quarterly, at the Eurodollar rate plus 1.50% (2.69% and 3.56% at
December&nbsp;31, 2003 and 2004, respectively). The Term&nbsp;B
loan is payable in full upon maturity and bears interest,
payable quarterly, at the Eurodollar rate plus 1.25% (2.44% and
3.31% at December&nbsp;31, 2003 and 2004, respectively).
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the Credit Agreement instituted a revolving loan
component (the Revolver) not to exceed $20,000, as amended,
which includes a sub-facility for letters of credit, discussed
in note&nbsp;11, that at no time may exceed the borrowing
capacity available under the Revolver. The Revolver, is due to
mature on July&nbsp;31, 2005 and bears interest, payable
quarterly, at a &#147;Base Rate&#148; (as defined in the Credit
Agreement) which was 4.00% and 5.25% at December&nbsp;31, 2003
and 2004, respectively. Amounts available under the Revolver as
of December&nbsp;31, 2003 and 2004 totaled $4,000 and $3,450,
respectively.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Credit Agreement provides for the payment to the lenders of
certain fees. These fees include an agent&#146;s fee of $300,
paid on the effective date of the Credit Agreement. Furthermore,
the Company has an obligation to pay the lenders a quarterly fee
of 0.25% of the unused revolving component.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Substantially all of the assets of Express have been pledged as
security for borrowings under the Credit Agreement. In
connection with the Credit Agreement, Delek Group entered into a
Limited Guarantee (Guarantee) for the benefit of the Company and
in favor of Leumi and Hapoalim. The general terms of the
Guarantee require Delek Group to guarantee a significant amount
in the event the Company is unable to perform its payment
obligations under the Credit Agreement. The Guarantee expires on
the earlier of July&nbsp;1, 2011 or the complete payment
satisfaction of all amounts outstanding under the Credit
Agreement.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Credit Agreement contains certain provisions that restrict
the Company from paying dividends to its shareholder prior to
July&nbsp;31, 2005 and only after meeting certain additional
restrictive measures. Additionally, the Credit Agreement
requires the Company to comply with certain financial and
non-financial covenants.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Union Planters Term Loan and Revolver</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During February 2003, the Company signed a credit agreement with
Union Planters bank to finance a portion of the February 2003
purchase of seven convenience stores located in Tennessee. This
credit agreement (the Union Planters Agreement) provided for a
term loan (the Union Planters Term Loan) in the amount of $9,000
which was to mature on February&nbsp;27, 2009. The Union
Planters Term Loan was subject to mandatory reductions in the
principal amount outstanding over its term. Under the Union
Planters Agreement, the Company was restricted from paying
dividends to its shareholder. Furthermore, under the Union
Planters Agreement, the Company was subject to certain financial
covenants that began on June&nbsp;30, 2003.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Additionally, the Union Planters Agreement instituted a
revolving loan component (the Union Planters Revolver) not to
exceed $500 with a maturity date of August&nbsp;27, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the WOC acquisition discussed in note&nbsp;3,
the Company terminated the Union Planters Agreement and replaced
it with the SunTrust Agreement discussed below. All outstanding
principal and interest amounts under the Union Planters
Agreement were repaid with the proceeds from the execution of
the SunTrust Agreement.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-19

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>SunTrust Term Loan and Revolver</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;30, 2004, the Company entered into a credit
agreement (the SunTrust Agreement) with SunTrust Bank in its
capacity as the administrative agent for a consortium of
lenders. The SunTrust Agreement provided for a term loan (the
SunTrust Term Loan) in an aggregate principal amount equal to
$34,500. The proceeds were used to pay a portion of the purchase
price of the WOC acquisition discussed in note&nbsp;3 and
refinance a portion of the related debt acquired. The SunTrust
Term Loan matures on June&nbsp;30, 2008 and requires mandatory
reductions in principal amounts outstanding through its term.
The SunTrust Term Loan bears interest based on a predetermined
pricing grid which allows the Company to select between a
&#147;Base Rate&#148; or &#147;LIBOR&#148; loan (as defined in
the SunTrust Agreement). Interest is payable under the SunTrust
Term Loan on a quarterly basis for Base Rate loans and coincide
with the applicable interest period, not to exceed 90&nbsp;days,
for LIBOR loans. As of December&nbsp;31, 2004, the borrowing
rate on the SunTrust Term Loan was 5.20%.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the SunTrust Agreement provides for a revolving
loan component (the SunTrust Revolver) not to exceed $6,000. The
SunTrust Revolver is due to mature April&nbsp;30, 2008, unless
the Company opts to reduce the revolving commitment, in part or
in whole, prior to the termination date. In accordance with the
SunTrust Agreement, the Company is required to reduce the amount
available under the SunTrust Revolver by the proceeds received
from the disposition of strategic assets until the proceeds can
be used to acquire replacement strategic assets within a period
not to exceed a 360&nbsp;day period subsequent to the
disposition. In the event replacement strategic assets are not
acquired within the 360&nbsp;day period, the proceeds must be
applied to the outstanding principal balance of the SunTrust
Term Loan in inverse order of maturity. During 2004, the Company
received proceeds from the disposition of certain strategic
assets totaling $460 which were used to reduce the amounts
outstanding under the SunTrust Revolver. Amounts available under
the SunTrust Revolver as of December&nbsp;31, 2004 totaled
$2,013. Interest is payable on borrowings under the SunTrust
Revolver on a quarterly basis, at a &#147;Base Rate&#148; (as
defined in the SunTrust Agreement). As of December&nbsp;31,
2004, the weighted average borrowing rate on the SunTrust
Revolver was 5.21%.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Substantially all of the assets of Family Centers have been
pledged as security for borrowings under the SunTrust Agreement.
Under the SunTrust Agreement, the Company is restricted from
paying dividends to its shareholder. Additionally, the SunTrust
Agreement requires the Company to be in compliance with certain
financial and non-financial covenants.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Capital Lease Obligations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the WOC acquisition on April&nbsp;30, 2004,
discussed in note&nbsp;3, the Company assumed certain capital
lease obligations for equipment with two financial institutions.
The leases with maturity dates ranging from September&nbsp;15,
2005 to March&nbsp;23, 2007 include provisions for interest at
rates ranging from 9.40% to 11.54% and require monthly payments
of principal and interest.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-20

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Maturities of Long-Term Obligations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Principal maturities of the Company&#146;s existing debt
instruments and capital lease obligations for the next five
years and thereafter are as follows as of December&nbsp;31, 2004:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="32%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2006</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2007</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2008</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2009</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Thereafter</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Total</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Related Party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$3,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$25,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$28,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Term A</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,084</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>23,672</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>89,900</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Term B</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>42,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>42,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SunTrust Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,600</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>23,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,700</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SunTrust Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,527</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>389</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>213</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>616</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$23,405</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$17,403</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$59,954</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$65,363</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$13,536</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$23,672</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$203,333</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Derivative Instruments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has entered into multiple interest rate swap
agreements on $19,231 of notional principal amounts and multiple
interest rate cap agreements on $145,000 of notional principal
amounts as of December&nbsp;31, 2004. These agreements are
intended to economically hedge floating rate debt relating to
the Credit Agreement and the SunTrust Agreement, discussed
above. However, as the Company elected to not comply with the
requirements, including formal hedge designation and
documentation, to apply hedge accounting treatment in accordance
with the provisions of SFAS&nbsp;No.&nbsp;133, the Company is
recording the fair value of the derivatives in the consolidated
balance sheets with the offsetting entry to earnings. The
derivative instruments mature on various dates ranging from
January 2006 through July 2010. The estimated fair value of the
Company&#146;s interest rate swap and interest rate cap
agreements at December&nbsp;31, 2003 and 2004, respectively,
totaled $359 and $1,921, net, and was recorded in other
noncurrent assets in the accompanying consolidated balance
sheets.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;133, as amended, the
Company recorded $2,583, ($242) and $727 of non-cash interest
expense (income) representing the change in estimated fair value
of the interest rate swap and interest rate cap agreements for
the years ended December&nbsp;31, 2002, 2003 and 2004,
respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>10.</B></TD>
    <TD>
    <B>Income Taxes</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts
used for income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the year ended December&nbsp;31, 2004 the Company
recorded a valuation allowance in the amount of $501 related to
certain state net operating loss carryforwards acquired in
connection with the WOC acquisition discussed in note&nbsp;3.
This valuation allowance recorded as a part of purchase
accounting resulted in an increase to goodwill.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In assessing the realizability of deferred tax assets,
management considers whether it is more likely than not that
some portion or all of the deferred tax assets will be realized.
The ultimate realization of deferred tax assets is dependent
upon the generation of future taxable income during the periods
in which those
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-21

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
temporary differences become deductible. Management considers
the scheduled reversal of deferred tax liabilities, projected
future taxable income, and tax planning strategies in making
this assessment. Based upon the level of historical taxable
income and projections for future taxable income over the
periods, for which the deferred tax assets are deductible,
management believes it is more likely than not the Company will
realize the benefits of these deductible differences, net of the
existing valuation allowance. The amount of the deferred tax
assets considered realizable, however, could be reduced in the
near term if estimates of future taxable income during the
carryforward period are reduced. Subsequently recognized tax
benefit or expense relating to the valuation allowance for
deferred tax assets, excluding the portion attributable to the
WOC acquisition, will be reported as an income tax benefit or
expense in the consolidated statement of operations. Any
subsequently recognized tax benefit related to the valuation
allowance for deferred tax assets recognized in connection with
the WOC acquisition will be recorded against goodwill.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the Company&#146;s purchase of 100% of the
issued and outstanding stock of WOC discussed in note&nbsp;3,
the Company recorded goodwill in the amount of $4,659, none of
which is deductible for income tax purposes.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At December&nbsp;31, 2004, the Company had net federal operating
loss carryforwards of $17,894 which begin expiring in 2018.
State net operating loss carryforwards at December&nbsp;31, 2004
totaled $29,420 and begin expiring in 2013.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant components of the Company&#146;s deferred tax assets
and liabilities, included as a component of other current assets
and listed separately in the accompanying consolidated financial
statements, respectively, as of December&nbsp;31, 2003 and 2004
are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="66%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Current Deferred Taxes:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Medical and workers&#146; compensation benefits</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$618</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$780</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other accrued reserves</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>160</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>287</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current deferred tax assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>778</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,067</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Noncurrent Deferred Taxes:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation/amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,791</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(28,791</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net operating loss carry forwards</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,369</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Straight-line lease expense</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>813</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,177</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,386</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,018</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Valuation allowance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(501</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total noncurrent deferred tax liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,704</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(17,728</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(3,926</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(16,661</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-22

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The difference between the actual income tax expense (benefit)
and the tax expense (benefit) computed by applying the statutory
federal income tax rate to income (loss) before taxes is
attributable to the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="69%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Provision (benefit) for federal income taxes at statutory rate</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(251</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,898</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    State income taxes, net of federal tax provision</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(30</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>447</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>493</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other items</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(133</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(259</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense (benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income tax expense (benefit) for the years ended
December&nbsp;31, 2002, 2003 and 2004 is as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="69%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$107</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$72</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$189</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(371</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,742</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,943</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>(264</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,814</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,132</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>11.</B></TD>
    <TD>
    <B>Commitments and Contingencies</B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Litigation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is subject to various claims and legal actions that
arise in the ordinary course of business. In the opinion of
management, the ultimate resolution of any such matters known by
management will not have a material adverse effect on the
Company&#146;s financial position or results of operations in
future periods.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Self-insurance</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is self-insured for employee medical claims up to
$90&nbsp;per employee per year or an aggregate of approximately
$3,886&nbsp;per year.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is self-insured for workers&#146; compensation
claims up to $350 on a per claim basis and maintains annual
aggregate stop loss coverage for aggregate claims in excess of
$6,110. Additionally, the Company is self-insured for general
liability claims up to $350 on a per claim basis and maintains
annual stop loss coverage for aggregate claims in excess of
$6,110.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Employment Agreement</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company maintains an employment agreement with an executive
officer which contains a deferred compensation element. Based on
the agreement, the officer is entitled to one, but not both, of
the issuance of shares pursuant to share purchase rights or a
cash award. The share purchase rights award totals 5% of the
Company&#146;s outstanding shares and vests ratably over the
five-year period of the agreement, but is contingent upon the
Company completing an initial public offering during the
five-year period ending April&nbsp;30, 2009. As the exercise of
these share purchase rights is contingent on the completion of
an initial public offering, in accordance with Accounting
Principles Board No.&nbsp;25, <I>Accounting for Stock Issued to
Employees</I>, compensation expense will only be recognized upon
satisfaction of the contingency. Accordingly, upon completion of
an initial public offering, compensation expense would be
recorded for the vested portion of
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-23

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
the share purchase rights based on the five-year vesting period
and calculated as the difference in the stipulated exercise
price and the fair value of the awards on that date.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As long as the Company does not complete an initial public
offering, the officer is entitled to a cash award which may not
exceed $3,000 over the five year period dependent on the
Company&#146;s performance. The Company has accrued
approximately $130 under this agreement during 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Vendor Commitments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company maintains an agreement with a significant vendor
that requires the Company to purchase certain general
merchandise exclusively from the vendor over a specified period
of time. Additionally, the Company maintains agreements with
certain fuel suppliers with various terms which generally
require the Company to purchase predetermined quantities of fuel
for a specified period.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Letters of Credit</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of December&nbsp;31, 2004, the Company has in place six
letters of credit totaling $12,550 with two financial
institutions securing obligations with respect to its
workers&#146; compensation and general liability self-insurance
program and its license to sell certain merchandise. No amounts
were outstanding under these facilities at December&nbsp;31,
2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Operating Leases</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company leases land, buildings, and equipment for store
locations as well as corporate office space under agreements
expiring at various dates through 2046, after considering
available renewal options. Many of these leases contain renewal
options and require the Company to pay executory costs (such as
property taxes, maintenance, and insurance). Lease expense for
all operating leases for the years ended December&nbsp;31, 2002,
2003 and 2004 totaled $7,078, $7,836 and $9,730, respectively.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following is the Company&#146;s future estimated lease
payments, including available renewal options for leases the
Company has determined are reasonably assured, under operating
leases having remaining noncancellable terms in excess of one
year as of December&nbsp;31, 2004:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$9,289</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,255</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,740</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2008</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,589</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2009</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,497</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Thereafter</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>113,092</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total future minimum rentals</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>157,462</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>12.</B></TD>
    <TD>
    <B>Employee Benefit Plan</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective October&nbsp;1, 2001, the Company adopted a defined
contribution benefit plan (the Plan). Participation in the Plan
is available to employees 21&nbsp;years of age or older and who
have one year of service with a minimum of one thousand hours of
service. The Plan is a Company-sponsored 401(k) plan in which
employees may contribute up to 15% of their eligible
compensation and vest immediately. Under the Plan, the Company
matches employee contributions up to 6% of their eligible
compensation. Employer contributions
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-24

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
vest 50% upon attaining two years of service and vest 100% upon
attaining three years of service. During 2004, the Company
elected an alternative to satisfying certain non-discrimination
requirements as allowed under The Small Business Job Protection
Act of 1996, commonly referred to as the safe harbor provision.
Under the elected provision, employees immediately vest 100% in
all employer contributions for the 2004 Plan year. For the years
ended December&nbsp;31, 2002, 2003 and 2004, the Company
recorded matching contributions totaling $478, $422 and $426,
respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>13.</B></TD>
    <TD>
    <B>Related Party Transactions</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In August of 2004, the Company executed a promissory note with
an officer in the amount of $100. The promissory note bears no
interest and is payable in full upon termination of the
officer&#146;s employment with the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Affiliates of the Company provide guarantees to various vendors
supporting the Company&#146;s fuel purchasing activities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>14.</B></TD>
    <TD>
    <B>Subsequent Events (unaudited)</B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Acquisitions</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective April&nbsp;29, 2005, the Company acquired certain
refinery and crude oil pipeline assets in Tyler, Texas
(collectively the Refinery) through its newly formed and wholly
owned subsidiary Delek Refining. Total consideration paid for
Refinery assets was $73,132, including capitalized acquisition
transaction costs of $5,048.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of June&nbsp;30, 2005, the Company had completed its
allocation of the purchase price for the WOC acquisition
discussed in note&nbsp;3. The final allocation of the purchase
price for the WOC acquisition resulted in net decreases to
goodwill of $825.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2005, the Company acquired 21 convenience stores and
four undeveloped properties in the Nashville market from BP
Products North America Inc. (BP Acquisition). Total
consideration paid for the BP Acquisition was $35,027.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Long-Term Obligations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During May 2005, the Company repaid all outstanding principal
and interest due under the $3,500 note payable to Delek Group.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;26, 2005, the Company entered into a $30,000
promissory note with Israel Discount Bank of New York (Israel
Discount Bank Note). The proceeds of this note were used to fund
a portion of the Refinery acquisition discussed above. The
Israel Discount Bank Note matures on April&nbsp;30, 2007 and
bears interest, payable quarterly, at a spread of 1.375% over
the 90&nbsp;day LIBOR, with the first interest payment due on
April&nbsp;30, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, the Company entered into a $20,000
promissory note with Bank Leumi USA (Bank Leumi Note). The
proceeds of this note were used to fund a portion of the
Refinery acquisition discussed above. The Bank Leumi Note
matures on April&nbsp;27, 2007 and bears interest, at a spread
of 1.375% over the LIBOR Rate (Reserve Adjusted), with the first
interest payment due in April&nbsp;2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, the Company signed a note payable with
Delek Group in the amount of $35,000. Proceeds from the note
were used primarily to fund a portion of the Company&#146;s
acquisition of the Refinery
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-25

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
discussed above. The note bears interest at a rate of
7.0%&nbsp;per annum with interest and principal payments due
upon maturity on April&nbsp;27, 2010.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;28, 2005, the Company executed an amended and
restated agreement with a new syndicate of lenders and Lehman
Commercial Paper Inc. serving as administrative agent (the
Senior Secured Credit Facility). In connection with the
execution of the amended and restated agreement, the Company
consolidated the borrowings under its existing Credit Agreement
and SunTrust Agreement into a single credit facility and
increased the borrowing capacity available under the facility to
$205,000.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Senior Secured Credit Facility consists of a $40,000
Revolving Credit Facility (the Senior Secured Credit Facility
Revolver) and a $165,000 term loan (the Senior Secured Credit
Facility Term Loan). Borrowings under the Senior Secured Credit
Facility are secured by substantially all the assets of the
merged Express and Family Centers entity discussed below. In
December 2005, the Company increased the Senior Secured Credit
Facility Revolver by $30,000 to $70,000, in connection with the
BP&nbsp;Acquisition discussed above.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Senior Secured Credit Facility Term Loan requires quarterly
principal payments of approximately 0.25% of the principal
balance through March&nbsp;31, 2011 and a balloon payment of
approximately 94.25% of the principal balance due upon maturity
on April&nbsp;28, 2011. The Senior Secured Credit Facility
Revolver is payable in full upon maturity on April&nbsp;28, 2009
with periodic interest repayment requirements. The Senior
Secured Credit Facility Term and Revolver loans bear interest
based on predetermined pricing grids which allow the Company to
choose between a &#147;Base Rate&#148; or &#147;Eurodollar&#148;
loan (as defined in the Senior Secured Credit Facility).
Interest is payable quarterly for Base Rate Loans and the
applicable interest period on Eurodollar Loans.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On May&nbsp;2, 2005 the Company entered into a $250,000 asset
based senior revolving credit facility with a syndicate of
lenders led by SunTrust Bank as administrative agent to finance
ongoing working capital, capital expenditures and general needs
of the Refinery. This agreement (the SunTrust ABL Revolver)
which matures on April&nbsp;29, 2009, bears interest based on
predetermined pricing grids which allow the Company to choose
between a &#147;Base Rate&#148; or &#147;Eurodollar&#148; loan
(as defined in the SunTrust ABL Revolver). Interest is payable
quarterly for Base Rate loans and the applicable interest period
on Eurodollar loans. Availability under the SunTrust ABL
Revolver is determined by a borrowing base defined in the
SunTrust ABL Revolver, supported primarily by certain accounts
receivable and inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Additionally, the SunTrust ABL Revolver supports the
Company&#146;s issuances of letters of credit in connection with
the purchases of crude for use in the refinery process that at
no time may exceed the aggregate borrowing capacity available
under the SunTrust ABL Revolver.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The SunTrust ABL Revolver contains certain negative covenants
and pledges which prohibit the Company from creating, incurring
or assuming any liens, mortgages, pledges, security interests or
other similar arrangements against the property, plant and
equipment of the Refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the Company&#146;s consolidation of the
borrowings under its existing Credit Agreement and SunTrust
Agreement into a single credit facility, the Senior Secured
Credit Facility, the Company wrote-off deferred financing costs
in the aggregate of $3,466 related to the Credit Agreement and
SunTrust Agreement and incurred and capitalized deferred
financing costs related to the Senior Secured Credit Facility of
$7,802. Additionally, in connection with the execution of the
SunTrust ABL Revolver the Company incurred and capitalized
deferred financing costs of $6,535.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-26

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>As of December&nbsp;31, 2003 and 2004 and for the</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Years Ended December&nbsp;31, 2002, 2003 and 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the issuances of the Israel Discount Bank
Note and Bank Leumi Note, Delek Group entered into a limited
guarantee for the benefit of the Company and in favor of Israel
Discount Bank of New York and Bank Leumi USA. The general terms
of the guarantee require Delek Group to guarantee a significant
amount in the event the Company is unable to perform its payment
obligations under the indicated notes. The guarantee expires in
April 2007 or earlier in the event the complete payment
satisfaction of all amounts outstanding under the indicated
notes have been met. In exchange for the guarantee, the Company
has agreed to pay Delek Group an annual fee equal to 1.5% of the
guaranteed amount payable ratably in four equal installments
during the term of the guarantee.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During June 2005, the Company executed an agreement whereby
Family Centers merged with and into Express, leaving Express as
the surviving company of the merged entities. In connection with
Family Centers&#146; legal merger into and with Express, all
amounts owed under the capital lease obligations were repaid and
the leases terminated.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-27

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='309'></A>
</DIV>

<!-- link1 "CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 9pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="61%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="10" align="center" valign="top">
    <B>ASSETS</B></TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current assets:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$147,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,106</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>85,473</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,210</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90,425</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,307</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,081</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,528</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,471</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>336,534</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,094</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property, plant and equipment:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property, plant and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>261,892</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>221,085</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less: accumulated depreciation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(42,474</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(31,792</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property, plant and equipment, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>219,418</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>189,293</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Restricted cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,717</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Non-compete agreements, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>574</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>649</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Goodwill</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>63,816</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note receivable from related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,116</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,034</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$641,558</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$330,173</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="10">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="10" align="center" valign="top">
    <BR>
    <B>LIABILITIES AND SHAREHOLDER&#146;S EQUITY</B></TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$18,375</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$16,086</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fuel payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>146,174</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,454</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,696</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,516</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note payable to related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>389</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,670</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,561</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,340</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and sales taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,023</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,468</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other product taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,989</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,618</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued employee costs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,920</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,899</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of environmental liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>433</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Forward contract settlement liability</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,790</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>71</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued expenses and other current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,858</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,383</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>227,971</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>72,285</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Noncurrent liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>220,982</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>154,701</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>227</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued lease liability</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,568</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,081</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred revenue, net of current portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,638</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,397</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Environmental liabilities, net of current portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,499</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Asset retirement obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,824</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred tax liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,802</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,728</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total noncurrent liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>318,313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>202,134</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Shareholder&#146;s equity:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Common stock, $0.01&nbsp;par value, 3,000&nbsp;shares
    authorized, 100&nbsp;shares issued and outstanding</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Additional paid-in capital</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>41,121</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retained earnings</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54,153</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,633</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total shareholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95,274</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55,754</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and shareholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$641,558</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$330,173</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-28

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='310'></A>
</DIV>

<!-- link1 "CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="55%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>For the Nine-Month</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>For the Nine-Month</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,387,541</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$617,971</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating costs and expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>526,294</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58,289</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,665</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,674</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;(Gain) on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Losses on forward contract activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,309,575</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>603,695</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,966</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,276</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,765</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,001</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,287</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>778</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Write-off of deferred financing costs in connection with
    refinance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Guarantee fees</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,817</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,654</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before income taxes and cumulative effect of change in
    accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,622</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,362</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,872</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,787</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,750</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>267</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,750</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings per share:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Income before cumulative effect of change in accounting
    policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$397,870</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$47,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,670</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    &nbsp;Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$395,200</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$47,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted weighted average common shares outstanding</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-29

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='311'></A>
</DIV>

<!-- link1 "CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="52%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>For the Nine-Month</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>For the Nine-Month</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Operating activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$39,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,750</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjustments to reconcile net income to net cash provided by
    operating activities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,301</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,205</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(287</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,690</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) loss on interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,014</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>875</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gain on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(227</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred financing costs written-off in connection with debt
    refinance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,466</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Unrealized losses on forward contract activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Changes in assets and liabilities (excluding those acquired or
    assumed):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(74,197</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,297</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,239</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,240</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,869</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(449</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(906</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>564</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(475</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>93,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,264</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest payable (including to related parties)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>889</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>958</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>36</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and sales taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>320</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other product taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,371</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,050</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued employee costs</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>877</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,059</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued expenses and other current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>89</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Asset retirement obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>395</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>728</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>283</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>139,230</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,218</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Investing activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Escrow payment made with escrow agent</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(5,061</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Business combinations, net of cash acquired</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(73,132</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(22,441</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchase price adjustments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(91</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchases of property, plant and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(8,415</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,832</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from sale of convenience store assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,111</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>510</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash used in investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(83,588</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(26,763</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
(continued)
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-30

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="55%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>For the Nine-Month</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>For the Nine-Month</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Period Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30, 2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Financing activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from issuances of notes payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Repayment of note payable to related party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,500</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from issuance of Senior Secured Credit
    Facility&nbsp;&#151; Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>165,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on Senior Secured Credit Facility&nbsp;&#151; Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(412</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net proceeds from Senior Secured Credit Facility&nbsp;&#151;
    Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from issuance of Israel Discount Bank Note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from issuance of Bank Leumi Note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on Credit Agreement&nbsp;&#151; Term&nbsp;A and
    Term&nbsp;B Loans</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(131,900</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(8,700</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (payments on) proceeds from Credit Agreement&nbsp;&#151;
    Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(5,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (payments on) proceeds from Sun Trust&nbsp;Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(33,700</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34,100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (payments on) proceeds from Sun Trust&nbsp;Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,527</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,664</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net proceeds from (payments on) notes payable-other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(59</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payment on Union Planters Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(9,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Repayment of acquired debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(28,563</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(616</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(216</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Decrease (increase) in restricted cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,717</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(549</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchase of interest rate derivative instruments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,289</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred financing costs paid in connection with debt issuances</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(13,783</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,926</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,279</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,962</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>124,921</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,417</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents at beginning of period</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,106</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18,907</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents at end of period</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$147,027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$22,324</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Supplemental disclosures of cash flow information</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash paid during the period for:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$10,502</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,321</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$750</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$146</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assets acquired via the issuance of notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$108</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Termination of equity investment in related party LLC and
    related debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,696</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-31

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='312'></A>
</DIV>

<!-- link1 "NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>1.</B></TD>
    <TD>
    <B>General</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Delek&nbsp;US Holdings, Inc. and Subsidiaries (Delek&nbsp;US or
the Company) is the sole shareholder of MAPCO Express, Inc.
(Express), MAPCO Fleet, Inc. (Fleet), Delek Refining Inc. (Delek
Refining), and Delek Finance, Inc. (Delek Finance) (collectively
the Subsidiaries). Delek&nbsp;US and Express were incorporated
during April 2001 in the State of Delaware. Fleet, Delek
Refining and Delek Finance were incorporated in the State of
Delaware during January 2004, February 2005 and April 2005,
respectively. Previously, the Company&#146;s subsidiaries
included separately MAPCO Family Centers, Inc. (Family Centers).
During June 2005, the Company executed an agreement whereby
Family Centers merged with and into Express, leaving Express as
the surviving company of the merged entities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is a wholly-owned subsidiary of Delek Group Ltd.
(Delek Group) located in Tel-Aviv, Israel.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company consists of two reportable segments&nbsp;&#151;
Refining and Retail discussed in note&nbsp;5.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>2.</B></TD>
    <TD>
    <B>Accounting Policies</B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Basis of Presentation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The condensed consolidated financial statements include the
accounts of the Company and have been prepared by the Company,
without audit. Certain information and footnote disclosures
normally included in annual financial statements prepared in
accordance with accounting principles generally accepted in the
United States have been condensed or omitted, although the
Company believes that the disclosures are adequate to make the
financial information presented not misleading. It is suggested
that these condensed consolidated financial statements be read
in conjunction with the audited financial statements and the
notes thereto for the year ended December&nbsp;31, 2004. In the
opinion of management, all adjustments necessary for a fair
statement of the results of operations for the interim period
have been included. All adjustments are of a normal, recurring
nature.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Principles of Consolidation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The condensed consolidated financial statements relate to Delek
US as of September&nbsp;30, 2005 and December&nbsp;31, 2004, and
for the nine-month periods ended September&nbsp;30, 2005 and
2004. All significant intercompany transactions and account
balances have been eliminated in consolidation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Reclassifications</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Certain amounts presented in prior period financial statements
have been reclassified to conform with the current period
presentation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Cash and Cash Equivalents</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company considers cash on hand and deposits in banks to be
cash. All highly liquid investments purchased with an original
maturity of three months or less are considered to be cash
equivalents.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Restricted Cash</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At December&nbsp;31, 2004, the Company maintained a restricted
cash balance totaling $2,482 related to proceeds received from
the disposition of certain assets during 2004 and 2003. In
accordance with the Credit Agreement discussed in note&nbsp;7,
the Company was required to deposit proceeds received from the
disposition
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-32

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
of assets into a cash collateral account until the proceeds
could be used to acquire replacement assets within a period not
to exceed twenty-four months subsequent to the disposition. In
the event replacement assets were not acquired within the
twenty-four month period, the proceeds would be applied to the
outstanding principal balance of the Term Loans.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the SunTrust Agreement discussed in note&nbsp;7
required the Company to maintain a deposit of cash and cash
equivalents as additional collateral. The cash collateral
requirements would be reduced as SunTrust perfected its security
interest in assets owned by the Company. Amounts classified as
restricted under the SunTrust Agreement at December&nbsp;31,
2004 totaled $1,235.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the execution of the Senior Secured Credit
Facility discussed in note&nbsp;7, the Company utilized its
existing restricted cash balances to reduce the outstanding
principal balances of the Credit Agreement and SunTrust
Agreement prior to amendment. Accordingly, at September&nbsp;30,
2005, the Company did not maintain a restricted cash balance.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Accounts Receivable</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Accounts receivable primarily represent receivables related to
credit card sales, receivables from vendor promotions and trade
receivables generated in the ordinary course of business. The
Company has recorded an allowance for doubtful accounts related
to trade receivables of $180 as of September&nbsp;30, 2005 and
December&nbsp;31, 2004. All other accounts receivable amounts
are considered to be fully collectible, and accordingly, no
additional allowance has been established as of
September&nbsp;30, 2005 and December&nbsp;31, 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Inventory</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Refinery inventory consists of crude oil, refined products and
blendstocks which are stated at the lower of cost or market.
Cost is determined under the
<FONT style="white-space: nowrap">last-in,</FONT> first-out
(LIFO)&nbsp;valuation method. The LIFO method requires
management to make estimates on an interim basis of the
anticipated on-hand year-end inventory quantities which could
differ from actual quantities. Cost of crude oil, refined
product and blendstock inventories in excess of market value are
charged to cost of goods sold. Such changes are subject to
reversal in subsequent periods, not to exceed LIFO cost, if
prices recover.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Retail merchandise inventory consists of gasoline, diesel fuel,
other petroleum products, cigarettes, beer, convenience
merchandise and food service merchandise. Fuel inventories are
stated at the lower of cost or market on a
<FONT style="white-space: nowrap">first-in,</FONT> first-out
(FIFO)&nbsp;basis. Non-fuel inventories are stated at estimated
cost as determined by the retail inventory method.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Prepaid Inventory</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
One of the Company&#146;s vendors requires advance payments for
the purchase of crude oil. Upon delivery, the Company records
the receipts of the crude oil as an increase to inventory. The
initial prepayment, prior to receipt of the crude oil, is
recorded as prepaid inventory.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Property, Plant, and Equipment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Assets acquired by the Company in conjunction with acquisitions
are recorded at estimated fair market value in accordance with
the purchase method of accounting as prescribed in Statement of
Financial Accounting Standards (SFAS)&nbsp;No.&nbsp;141,
<I>Business Combinations. </I>Other acquisitions of property,
plant and equipment are carried at cost. Betterments, renewals
and extraordinary repairs that extend the life of the asset
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-33

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
are capitalized. Maintenance and repairs are charged to expense
as incurred. The Company owns certain fixed assets on leased
locations and depreciates these assets and asset improvements
over the lesser of management&#146;s estimated useful lives of
the asset or the remaining lease term. Depreciation is computed
using the straight-line method over management&#146;s estimated
useful lives of the related assets, which are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Computer equipment and software</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Automobiles</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Furniture and fixtures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5-15&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refinery machinery and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15-20&nbsp; years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Convenience store equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7-15&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other site (POS)&nbsp;improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8-40&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Building and building improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;144, <I>Accounting for the
Impairment or Disposal of Long-Lived Assets</I>, the Company
evaluates the realizability of property, plant and equipment as
events occur that could indicate impairment using measurements
such as projected undiscounted operating cash flows from the
respective asset.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Refinery Turnaround Costs</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Refinery turnaround costs are incurred in connection with the
Company&#146;s planned shutdown and inspection of the
Refinery&#146;s major units to perform necessary repairs and
replacements. Refinery turnaround costs are deferred when
incurred and amortized on a straight-line basis over that period
of time estimated to lapse until the next planned turnaround
occurs. Refinery turnaround costs include, among other things,
the cost to repair, restore, refurbish or replace refinery
equipment such as vessels, tanks, reactors, piping, rotating
equipment, instrumentation, electrical equipment, heat
exchangers and fired heaters.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Goodwill</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Goodwill is accounted for under the provisions of
SFAS&nbsp;No.&nbsp;142, <I>Goodwill and Other Intangible
Assets.</I> This statement addresses how intangible assets and
goodwill should be accounted for upon and after their
acquisition. Specifically, goodwill and intangible assets with
indefinite useful lives are not amortized but are subject to
annual impairment tests based on their estimated fair value. In
accordance with the provisions of SFAS&nbsp;No.&nbsp;142, the
Company performs its annual review of impairment of goodwill in
the fourth quarter by comparing the carrying value of the
applicable reporting unit to the fair value of the reporting
unit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
If the fair value is less than the carrying value, then the
Company measures potential impairment by assigning the assets
and liabilities of the Company to the reporting unit in a manner
similar to a purchase transaction, in accordance with the
provisions of SFAS&nbsp;No.&nbsp;141 and comparing the implied
fair value of goodwill to its carrying value.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Income Taxes</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income taxes are accounted for under the provisions of
SFAS&nbsp;No.&nbsp;109, <I>Accounting for Income Taxes.</I> This
statement generally requires the Company to record deferred
income taxes for the differences between the book and tax bases
of its assets and liabilities, which are measured using enacted
tax rates and laws that
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-34

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
will be in effect when the differences are expected to reverse.
Deferred income tax expense represents the net change during the
period in the Company&#146;s deferred income tax assets and
liabilities.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the Company&#146;s acquisition of the
Refinery effective April&nbsp;29, 2005 discussed in note&nbsp;3,
the Company&#146;s consolidated effective tax rate changed.
Substantially all of the Company&#146;s Refinery operations are
organized as a limited partnership in the state of Texas, which
is not subject to income tax in the state of Texas. As a result,
the Refinery operation&#146;s effective tax rate for the year is
equal to the federal rate plus a nominal amount of state income
taxes. Consequently, the Company&#146;s consolidated effective
tax rate is reduced by Delek Refining&#146;s proportionate
contribution to the Company&#146;s consolidated pretax earnings.
The taxation of the Company&#146;s earnings in Texas is subject
to change if new legislation is enacted that would require
taxation of all or a portion of a limited partnership&#146;s
earnings.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the nine-month period ended September&nbsp;30, 2005, as a
result of an increase in income before income taxes, the
Company&#146;s statutory federal rate increased from
approximately 34% to 35%. The Company made adjustments to
certain of its deferred tax assets and liabilities to reflect
this increase. As a result, during the nine-month period ended
September&nbsp;30, 2005, the Company recorded additional income
tax expense of approximately $600.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Earnings Per Share</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Basic and diluted earnings per share are computed by dividing
net income by the weighted average common shares outstanding.
For the periods ending September&nbsp;30, 2005 and 2004, the
share purchase rights granted as discussed in note&nbsp;10 were
the only potentially dilutive instruments. As the exercise of
these share purchase rights is contingent upon the completion of
an initial public offering, they are not considered potentially
dilutive until the initial public offering has been completed.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Stock-Based Compensation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company currently accounts for employee stock options under
the intrinsic method in accordance with Accounting Principles
Board Opinion (APB)&nbsp;No.&nbsp;25, <I>Accounting for Stock
Issued to Employees</I>, as permitted by SFAS&nbsp;No.&nbsp;123,
<I>Share-Based Payment</I>. SFAS&nbsp;123 requires the Company
to provide pro forma information regarding income per share as
if compensation cost for share purchase rights granted under the
employment agreement described in Note&nbsp;10, had been
determined in accordance with the fair value method. Since the
vesting of the share purchase rights is contingent on a future
event that is not currently considered probable, no share
purchase rights have vested and no pro forma compensation cost
is disclosed.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Fair Value of Financial Instruments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The fair values of financial instruments are estimated based
upon current market conditions and quoted market prices for the
same or similar instruments as of September&nbsp;30, 2005, and
December&nbsp;31, 2004. Management estimates that book value
approximates fair value for all of the Company&#146;s assets and
liabilities that fall under the scope of SFAS&nbsp;No.&nbsp;107,
<I>Disclosures about Fair Value of Financial Instruments.</I>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A majority of the Company&#146;s debt and derivative financial
instruments outstanding at September&nbsp;30, 2005, and
December&nbsp;31, 2004, were executed with a limited number of
financial institutions. The risk of counterparty default is
limited to the unpaid portion of amounts due to the Company
pursuant to the terms of the derivative agreements. The net
amount due from these financial institutions at
September&nbsp;30, 2005, and December&nbsp;31, 2004, totaled
$2,935 and $1,921, respectively, as discussed in note&nbsp;7.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-35

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Revenue Recognition</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Revenues for products sold are recorded upon delivery of
product, which is the point at which title to the product is
transferred, and when payment has either been received or
collection is reasonably assured.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company derives service revenue from the sale of lottery
tickets, money orders, and other ancillary product and service
offerings. Service revenue and related costs are recorded at
gross amounts and net amounts, as appropriate, in accordance
with the provisions of Financial Accounting Standards Board
(FASB)&nbsp;Emerging Issues Task Force
(EITF)&nbsp;<FONT style="white-space: nowrap">99-19,</FONT>
<I>Reporting Revenue Gross as a Principal Versus Net as an
Agent</I>. The Company records service revenue and related costs
at gross amounts when the Company is the primary obligor, is
subject to inventory risk, has latitude in establishing prices
and selecting suppliers, influences product or service
specifications, or has several but not all of these indicators.
The Company records service revenues net of costs when the
Company is not the primary obligor and does not possess other
indicators of gross reporting as discussed.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Advertising Costs</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company expenses advertising costs as incurred. Advertising
expense for the nine-month periods ended September&nbsp;30, 2005
and 2004 totaled approximately $800 for each period.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Vendor Discounts and Deferred Revenue</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company receives cash discounts or cash payments from
certain vendors related to product promotions based upon factors
such as quantities purchased, quantities sold, merchandise
exclusivity, store space and various other factors. In
accordance with Emerging Issues Task Force
(EITF)&nbsp;<FONT style="white-space: nowrap">02-16,</FONT>
<I>Accounting by a Reseller for Consideration Received from a
Vendor</I>, the Company recognizes these amounts as a reduction
of inventory until the products are sold, at which time the
amounts are reflected as a reduction in cost of goods sold.
Certain of these amounts are received from vendors related to
agreements covering several periods. These amounts are initially
recorded as deferred revenue, are reclassified as a reduction in
inventory upon receipts of the products, and are subsequently
recognized as a reduction of cost of goods sold as the products
are sold.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company also receives advance payments from certain vendors
related to contractual agreements. These amounts are recorded as
deferred revenue and are subsequently recognized in revenue as
earned in accordance with the terms of the agreements.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Self-Insurance Reserves</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is primarily self-insured for employee medical,
workers&#146; compensation, and general liability costs, with
varying limits of per claim and aggregate stop loss insurance
coverage that management considers adequate. The Company
maintains an accrual for these costs based on claims filed and
an estimate of claims incurred but not reported. The difference
between actual settlements and recorded accruals are recorded in
the period identified.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Environmental Expenditures</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
It is the Company&#146;s policy to accrue environmental and
<FONT style="white-space: nowrap">clean-up</FONT> related costs
of a non-capital nature when it is both probable that a
liability has been incurred and the amount can be reasonably
estimated. Environmental liabilities represent the current
estimated costs to investigate and remediate contamination at
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-36

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
the Company&#146;s properties. This estimate is based on
internal and third-party assessments of the extent of the
contaminations, the selected remediation technology and review
of applicable environmental regulations. Accruals for estimated
costs from environmental remediation obligations generally are
recognized no later than completion of the remedial feasibility
study and include, but are not limited to, costs to perform
remedial actions and costs of machinery and equipment that is
dedicated to the remedial actions and that does not have an
alternative use. Such accruals are adjusted as further
information develops or circumstances change. Expenditures for
equipment necessary for environmental issues relating to ongoing
operations are capitalized.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Adoption of FIN 47</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective January&nbsp;1, 2005, the Company adopted
Interpretation No.&nbsp;47, <I>Accounting for Conditional Asset
Retirement Obligations </I>(FIN&nbsp;47), which requires
companies to recognize a liability for the fair value of a legal
obligation to perform asset-retirement activities that are
conditional on a future event when the amount can be reasonably
estimated. FIN&nbsp;47 also clarifies when an entity would have
sufficient information to reasonably estimate the fair value of
an asset retirement obligation under Statement of Financial
Accounting Standards No.&nbsp;143, <I>Accounting for Asset
Retirement Obligations</I> (SFAS&nbsp;143).
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Associated with the adoption of the standard the Company
recorded a cumulative effect of adoption of $267 (net of $180 of
income taxes) ($2,670 per share) and a long-term asset
retirement obligation of $1,539. The effect on the results of
operations for the nine months ended September&nbsp;30, 2005 and
the pro forma effects on the results of operations for the nine
months ended September&nbsp;30, 2004 are $125 and $71,
respectively.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s initial asset retirement obligation as of
January&nbsp;1, 2005 relates to the removal of underground
storage tanks at the Company&#146;s leased retail sites as
legally required under the applicable leases. The asset
retirement obligation for storage tank removal on leased retail
sites is being accreted over the expected life of the
underground storage tanks which approximates the average retail
site lease term.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Subsequent to adoption of FIN&nbsp;47, the Company recorded a
long-term asset retirement obligation on April&nbsp;29, 2005 in
connection with its purchase of the Refinery of $1,255 related
to the required disposal of waste in certain storage tanks. In
addition to this identified asset retirement obligation at the
Refinery, the Company is continuing to evaluate the need for
additional asset retirement obligations related to the Refinery
as discussed in Note&nbsp;3.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In order to determine fair value, management must make certain
estimates and assumptions including, among other things,
projected cash flows, a credit-adjusted risk-free rate and an
assessment of market conditions that could significantly impact
the estimated fair value of the asset retirement obligation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Comprehensive Income</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Comprehensive income for the nine-month periods ended
September&nbsp;30, 2005 and 2004 was equivalent to net income
for the Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Operating Leases</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company leases land and buildings under various operating
lease arrangements, most of which provide the Company with the
option, after the initial lease term, to renew the leases. Some
of these lease
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-37

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
arrangements include fixed rental rate increases, while others
include rental rate increases based upon such factors as
changes, if any, in defined inflationary indices.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;13, <I>Accounting for
Leases</I>, for all leases that include fixed rental rate
increases, the Company calculates the total rent expense for the
entire lease period, considering renewals for all periods for
which failure to renew the lease imposes economic penalty, and
records rental expense on a straight-line basis in the
accompanying condensed consolidated statements of operations.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Derivatives</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company records all current derivative financial
instruments, such as interest rate swap agreements, interest
rate cap agreements, fuel related derivatives and forward
contracts at estimated fair value regardless of their intended
use in accordance with the provisions of SFAS&nbsp;No.&nbsp;133,
<I>Accounting for Derivative Instruments and Hedging
Activities</I>, as amended and interpreted. Changes in the fair
value of the derivative instruments have historically been
recognized periodically in operations as such instruments did
not comply with the hedging requirements of
SFAS&nbsp;No.&nbsp;133 which allow such changes to be classified
as other comprehensive income. The Company obtains the fair
value of all derivative financial instruments on a monthly basis
from third party financial and brokerage institutions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Changes in the fair value of certain fuel related derivatives
are recorded as an adjustment to cost of goods sold. The Company
recorded net increases to cost of goods sold as a result of
these fuel related derivative transactions of $264 and $413,
respectively, during the nine-month periods ended
September&nbsp;30, 2005 and 2004. Such amounts include both
realized and unrealized gains and losses. The Company obtains
the fair value of these fuel related derivative instruments on a
monthly basis from third party brokerage institutions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During August and September of 2005, the Company entered into
six forward fuel contracts with a major financial institution.
The contracts, which fix the purchase price of crude and sales
price of finished grade fuel for a predetermined number of units
at a future date, have fulfillment terms of less than
60&nbsp;days. The Company recorded unrealized losses of $10,923
during the nine-month period ended September&nbsp;30, 2005 which
are included as losses on forward contract hedging activities as
well as forward contract settlement liability in the
accompanying condensed consolidated statements of operations and
condensed consolidated balance sheets, respectively. The Company
obtains information to calculate the fair value of these forward
contracts on a daily basis from a third party financial
institution.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Use of Estimates</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could
differ from those estimates.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>New Accounting Pronouncements</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004, the FASB issued SFAS&nbsp;No.&nbsp;123R,
<I>Share-Based Payment</I>, which requires expensing stock
options and other share-based compensation payments to employees
and supersedes SFAS&nbsp;No.&nbsp;123, which had allowed
companies to choose between expensing stock options or showing
pro forma disclosure
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-38

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
only. SFAS&nbsp;No.&nbsp;123R requires all share-based payments
to employees, including grants of employee stock options, to be
recognized in the income statement based on their fair values.
Pro forma disclosure is no longer an alternative. This standard
is effective for the Company as of January&nbsp;1, 2006 and will
apply to all awards granted, modified, cancelled or repurchased
after that date as well as the unvested portion of prior awards.
The Company will apply SFAS&nbsp;123R prospectively to new
awards and to awards modified, repurchased or cancelled after
January&nbsp;1, 2006 as well as the unvested portion of prior
awards. The impact of adoption on the Company&#146;s financial
position and results of operations is still being evaluated.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In November 2004, the FASB issued Statement No.&nbsp;151,
<I>Inventory Costs</I>, which clarifies the accounting for
abnormal amounts of idle facility expense, freight, handling
costs, and wasted material and requires that those items be
recognized as current-period charges. Statement No.&nbsp;151
also requires that allocation of fixed production overhead to
the costs of conversion be based on the normal capacity of the
production facilities. Statement No.&nbsp;151 is effective for
fiscal years beginning after June&nbsp;15, 2005, and its impact
on the Company&#146;s financial position and results of
operations has not been determined.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004, the FASB issued SFAS&nbsp;No.&nbsp;153,
<I>Exchanges of Nonmonetary Assets</I>, which addresses the
measurement of exchanges of nonmonetary assets.
SFAS&nbsp;No.&nbsp;153 eliminates the exception from fair value
measurement for nonmonetary exchanges of similar productive
assets, which was previously provided by Accounting Principles
Board (APB)&nbsp;Opinion No.&nbsp;29, <I>Accounting for
Nonmonetary Transactions</I>, and replaces it with an exception
for exchanges that do not have commercial substance.
SFAS&nbsp;No.&nbsp;153 specifies that a nonmonetary exchange has
commercial substance if the future cash flows of the entity are
expected to change significantly as a result of the exchange.
SFAS&nbsp;No.&nbsp;153 is effective for nonmonetary asset
exchanges occurring in fiscal periods beginning after
June&nbsp;15, 2005. The adoption of SFAS&nbsp;No.&nbsp;153 did
not affect the Company&#146;s financial position or results of
operations for the nine-month period ended September&nbsp;30,
2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In September 2005, the Emerging Issues Task Force,
(EITF)&nbsp;reached a consensus concerning the accounting for
linked purchase and sale arrangements in EITF Issue
No.&nbsp;04-13, <I>Accounting for Purchases and Sales of
Inventory with the Same Counterparty</I>. The EITF concluded
that non-monetary exchanges of finished goods inventory within
the same line of business be recognized at the carrying value of
the inventory transferred. The consensus is to be applied to new
buy/sell arrangements entered in reporting periods beginning
after March&nbsp;15, 2006. The Company does not expect the
impact of this EITF Issue
No.&nbsp;<FONT style="white-space: nowrap">04-13</FONT>
consensus to have a material effect on the Company&#146;s
financial position or results of operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In May 2005, the FASB issued SFAS&nbsp;No.&nbsp;154,
<I>Accounting Changes and Error Corrections&nbsp;&#151; a
replacement of APB Opinion No.&nbsp;20 and FASB Statement
No.&nbsp;3</I>. This statement changes the requirements for
accounting for and reporting a change in accounting principles
and applies to all voluntary changes in accounting principles.
It also applies to changes required by an accounting
pronouncement in the unusual instance that the pronouncement
does not include specific transition provisions. When a
pronouncement includes specific transition provisions, those
provisions should be followed. This statement requires
retrospective application to prior periods&#146; financial
statements of changes in accounting principles, unless it is
impracticable to determine either the period-specific effects or
the cumulative effect of change. This statement becomes
effective for fiscal years beginning after December&nbsp;15,
2005. The Company does not expect the adoption of the statement
to have an impact on the Company&#146;s financial position and
results of operations.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-39

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>3.</B></TD>
    <TD>
    <B>Acquisitions</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective April&nbsp;29, 2005, the Company acquired certain
refinery and crude oil pipeline assets in Tyler, Texas
(collectively, the Refinery) through its wholly owned subsidiary
Delek Refining. Total consideration paid for Refinery assets
approximated $68,084.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the acquisition, the Company assumed certain
involuntary employee termination benefit liabilities as outlined
in the seller&#146;s employee severance plan. The Company is in
the process of finalizing its plan (the Plan) for involuntary
termination but in connection with its purchase price allocation
has included an accrual of approximately $954 for its estimated
settlement of liabilities under the Plan. As of
September&nbsp;30, 2005, there have been no charges against or
adjustments of this liability. The Company estimates it will
finalize its Plan within one year from the period of
acquisition. Subsequent adjustments as a result of the
Company&#146;s finalization of its Plan will be included as
adjustments to the cost of the acquired entity.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the consideration paid as the acquisition cost
mentioned above for the Refinery, the Company incurred and
capitalized approximately $5,048 in acquisition transaction
costs. The allocation of the aggregate purchase price of the
Refinery acquisition is summarized as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fixed assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>33,819</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>59,885</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid inventory and other assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>26,436</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assumed accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(37,821</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assumed asset retirement obligation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,255</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assumed environmental liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(7,932</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>73,132</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company consolidated the Refinery&#146;s results of
operations beginning April&nbsp;29, 2005. The unaudited pro
forma consolidated results of operations for the nine months
ended September&nbsp;30, 2005 as if the Refinery acquisition had
occurred on January&nbsp;1, 2005 are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="84%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Revenues</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,667,833</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before cumulative effect of change in accounting policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$44,135</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Basic and diluted earnings per share before cumulative effect of
    change in accounting&nbsp;policy</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$441,350</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;30, 2004, the Company completed a stock purchase
agreement with an unrelated third party, whereby the Company
acquired 100% of the issued and outstanding stock of Williamson
Oil Co., Inc. (WOC), an Alabama corporation, which included
operating assets, working capital and related debt for 100
convenience stores located primarily in the state of Alabama. Of
the 100 stores acquired, eleven were owned by WOC but leased to
and operated by unrelated third parties. Thus, 89 stores were
directly operated by WOC. The acquisition included two wholly
owned subsidiaries of WOC that provide wholesale distribution of
fuel and merchandise to unrelated third parties and WOC
operating stores. Total consideration paid in exchange for 100%
of the stock of WOC was $20,751.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the consideration paid as the acquisition cost
mentioned above for WOC, the Company incurred and capitalized
approximately $2,475 in acquisition transaction costs, of which
$63 and $2,412 was
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-40

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
recorded during 2005 and 2004, respectively. The allocation of
the aggregate purchase price of the WOC acquisition is
summarized as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fixed assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$58,830</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,938</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>985</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,641</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Goodwill</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,834</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred tax liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(8,792</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Assumed liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(41,210</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$23,226</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The above acquisitions were accounted for using the purchase
method of accounting, as prescribed in SFAS&nbsp;No.&nbsp;141
and the results of their operations have been included in the
condensed consolidated statements of operations from the dates
of acquisition. The purchase price was allocated to the
underlying assets and liabilities based on their estimated
relative fair values. The final allocation of the Refinery
purchase price is subject to adjustments for a period not to
exceed one year from the consummation date, specifically with
respect to the allocation of the fair value of fixed assets to
specific components and the determination of the Refinery&#146;s
asset retirement obligations as required by FIN&nbsp;47. The
allocation period is intended to differentiate between amounts
that are determined as a result of the identification and
valuation process required by SFAS&nbsp;No.&nbsp;141 for all
assets acquired and liabilities assumed and amounts that are
determined because information that was not previously
obtainable becomes obtainable. As of June&nbsp;30, 2005, the
Company had completed its allocation of the purchase price for
the WOC acquisition. During the nine-month period ended
September&nbsp;30, 2005, the final allocation of the purchase
price for the WOC acquisition resulted in net decreases to
goodwill of $825.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>4.</B></TD>
    <TD>
    <B>Inventory</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Carrying value of inventories consisted of the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="64%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refinery raw materials and supplies</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,991</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refinery work in process</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,619</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refinery finished goods</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,590</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Convenience store fuel</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,356</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,802</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Convenience store merchandise</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,869</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,505</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>90,425</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>28,307</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>5.</B></TD>
    <TD>
    <B>Segment Data</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Statement of Accounting Standards No.&nbsp;131, <I>Disclosures
about Segments of an Enterprise and Related Information</I>,
requires disclosure of a measure of segment profit or loss. In
connection with the purchase of the Refinery and related assets
on April&nbsp;29, 2005, management began viewing the
Company&#146;s operating results in two reportable segments:
retail and refining.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-41

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Retail Segment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company operates 328 retail convenience stores throughout
the southeastern United States (177 and 93 of which are located
in Tennessee and Alabama, respectively) as of September&nbsp;30,
2005. The retail convenience stores, which primarily operate
under the Company&#146;s brand names &#147;MAPCO Express&#148;,
&#147;Discount Food Mart&#148; and &#147;East Coast&#148; as
well as other non-company proprietary brands, engage in the
retail marketing of gasoline, diesel fuel, other petroleum
products and convenience merchandise.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Refining Segment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective April&nbsp;29, 2005, the Company, as discussed in
note&nbsp;3, acquired the Refinery which processes a variety of
crude oils, including domestic sweet light crude oil that is
transported through the Company&#146;s crude oil pipeline and an
unrelated third party pipeline. The Refinery processes the crude
and manufactures transportation motor fuels including various
grades of gasoline, diesel fuel, aviation fuel and other
petroleum based products that are distributed through its
product terminal located at the Refinery, as well as through
third party pipelines.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Corporate, Other and Eliminations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Operations that are not included in either of the Company&#146;s
two reportable segments are included in the category Corporate
and Other. These operations consist primarily of corporate
headquarter operating expenses, depreciation and amortization
expense and interest income and expenses.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company measures the operating performance of each segment
within the above two reportable segments, based on the segment
contribution margin. The Company defines segment contribution
margin as net sales less cost of sales and operating expenses,
excluding depreciation and amortization.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For the Retail segment, cost of sales includes the costs of
specific products sold. Store operating expenses, include costs
such as wages of employees at the stores, utility expense for
the stores, lease expense for the stores and other costs of
operating the stores, excluding depreciation and amortization.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For the Refining segment, cost of sales includes all the costs
of crude oil, feedstocks and related transportation. Operating
expenses include the costs associated with the actual operation
of the Refinery, excluding depreciation and amortization.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to the purchase of the Refinery and related assets, the
Company had only the Retail segment, thus segment data prior to
2005 is not applicable.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-42

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following is a summary of business segment operating
performance for the period indicated:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="43%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap><B>Nine Months Ended September&nbsp;30, 2005</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Corporate,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Other and</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Refining</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retail</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Eliminations</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Consolidated</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net sales (excluding intercompany sales)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$588,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$798,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$241</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,387,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Intercompany sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating costs and expenses:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of goods sold</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>489,401</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>690,982</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(888</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,179,495</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,636</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,402</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>248</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>92,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Segment contribution margin</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$72,177</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$43,590</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(7</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,760</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    General and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,472</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gain on disposal of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,638</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Losses on forward contract activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$77,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$301,794</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$328,403</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$13,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$643,530</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>6.</B></TD>
    <TD>
    <B>Equity Investment in Related Party LLC</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Between June&nbsp;20, 2002 and December&nbsp;31, 2003, the
Company was the nominee of its affiliates Delek&nbsp;&#151; The
Israel Fuel Corporation Ltd. (Delek Fuel) and Delek Motors Ltd.
(Delek Motors), each a subsidiary of Delek Group, with regard to
a two-thirds membership interest in another affiliate, El-Ad
Delek LLC (Related Party LLC or the LLC), a Delaware limited
liability company. The two-thirds membership interest in the LLC
was beneficially owned in equal amounts by those affiliates and
held of record by the Company. The LLC is principally engaged in
the ownership and charter operations of a corporate aircraft
based in New Jersey. During this period the Company did not
invest any amounts in this entity, did not exercise control over
this entity and was not entitled to any of the economic benefits
or risks of loss of ownership. On December&nbsp;31, 2003, the
Company agreed to terminate this nominee arrangement so that
Delek Fuel and Delek Motors would become record, as well as
beneficial, owners of their respective one third
beneficially-owned interests in the LLC held by the Company as
nominee.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective December&nbsp;31, 2003, the Company purchased 33.3% of
the membership interest in the LLC, from Delek Fuel for $6,696.
The Company acquired the interest in the LLC from Delek Fuel by
issuing a variable rate promissory note payable of $6,696 for
which the entire principal balance and interest was due in full
on January&nbsp;1, 2009. The note bore interest based on LIBOR
plus 1.50%&nbsp;per year.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On May&nbsp;17, 2004, the Company and Delek Fuel agreed to
terminate this purchase and sale agreement and the related
promissory note payable to Delek Fuel effective
December&nbsp;31, 2003. In connection with terminating the
agreements effective December&nbsp;31, 2003, Delek Fuel agreed
to become solely responsible for all income and expense related
to the 33.3% membership interest in the LLC and to cancel the
related note payable as of January&nbsp;1, 2004. As such, there
are no equity earnings, income or expenses related to the LLC
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-43

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
or interest expense related to the note payable recorded within
the Company&#146;s consolidated financial statements for the
year ended December&nbsp;31, 2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>7.</B></TD>
    <TD>
    <B>Long-Term Obligations</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Outstanding borrowings under the Company&#146;s existing debt
instruments and capital lease obligations at September&nbsp;30,
2005 and December&nbsp;31, 2004 are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="61%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>September&nbsp;30,</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes payable to related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$28,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Credit Agreement&nbsp;&#151; Term Loans (A and B)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>131,900</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Credit Agreement&nbsp;&#151; Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SunTrust Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,700</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SunTrust Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,527</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Senior Secured Credit Facility&nbsp;&#151; Term Loan</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>164,588</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Senior Secured Credit Facility&nbsp;&#151; Revolver</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Israel Discount Bank Note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Bank Leumi Note</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>616</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>90</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>282,678</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>203,333</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,650</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(19,516</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Note payable to Related Party&nbsp;&#151; currently due</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,500</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of capital lease obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(389</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of other notes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(46</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$280,982</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$179,928</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Notes&nbsp;Payable to Related Parties</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During February 2003, the Company signed a note payable with
Delek Group in the amount of $3,500. Proceeds from the note were
used in the February 2003 purchase of seven convenience stores
located in Tennessee. The note bore interest at a rate of
4.0%&nbsp;per annum. On August&nbsp;17, 2004, the Company
modified the maturity date of this note payable that was
originally due to mature on August&nbsp;26, 2004. The note
payable, after the modification, was due to mature on
December&nbsp;31, 2005. During May 2005, the Company repaid all
outstanding principal and interest due under the note.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;28, 2004, the Company signed a note payable with
Delek Fuel in the amount of $25,000. Proceeds from the note were
used to fund a portion of the WOC purchase discussed in
note&nbsp;3. The note bears interest at a rate of 6.30%&nbsp;per
annum with interest and principal payments due upon maturity on
April&nbsp;27, 2008.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-44

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, the Company signed a note payable with
Delek Group in the amount of $35,000. Proceeds from the note
were used primarily to fund a portion of the Company&#146;s
acquisition of the Refinery discussed in note&nbsp;3. The note
bears interest at a rate of 7.0%&nbsp;per annum with interest
due and payable in semi-annual installments commencing
July&nbsp;1, 2007 and principal payments due upon maturity on
April&nbsp;27, 2010.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Credit Agreement&nbsp;&#151; Term Loans (A and B) and
    Revolver</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On July&nbsp;31, 2002, the Company entered into a Credit
Agreement with Bank Leumi USA (Leumi) and Bank Hapoalim BM
(Hapoalim). Subsequently, during March of 2004 and again in
April of 2004, the Company and the lenders executed an amended
and restated Credit Agreement (the Credit Agreement) which among
other things changed certain covenants of the original agreement
for 2004 and beyond. The Credit Agreement provided two term
loans (Term A and Term B) to the Company in the original
principal amount totaling $158,000 in aggregate, a portion of
the proceeds of which were used to pay off existing borrowings
under two short-term promissory notes. The term loans in the
original and distinct principal amounts of $116,000 and $42,000
were due to mature on July&nbsp;1, 2011 (Term A) and
July&nbsp;1, 2007 (Term B), respectively. The Term A loan was
subject to mandatory reductions in principal over its term while
the Term B loan was payable in full upon maturity.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the Credit Agreement contained a revolving loan
component (the Revolver) not to exceed $20,000, as amended,
which included a sub-facility for letters of credit that at no
time could exceed the borrowing capacity available under the
Revolver.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Credit Agreement required the Company to comply with certain
financial and non-financial covenants. The Company believes it
was in compliance with all covenant requirements at
December&nbsp;31, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the execution of the Senior Secured Credit
Facility described below, in April 2005, the Company wrote-off
approximately $2,349 of unamortized deferred financing costs
paid in connection with the original execution of the Credit
Agreement. The write-off of these costs is included as a
component of interest expense in the accompanying condensed
consolidated statements of operations for the indicated periods.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>SunTrust Term Loan and Revolver</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;30, 2004, the Company entered into a credit
agreement (the SunTrust Agreement) with SunTrust Bank in its
capacity as the administrative agent for a consortium of
lenders. The SunTrust Agreement provided for a term loan (the
SunTrust Term Loan) in an aggregate principal amount equal to
$34,500. The proceeds were used to pay a portion of the purchase
price of the WOC acquisition discussed in note&nbsp;3 and
refinance a portion of the related debt acquired. The SunTrust
Term Loan was due to mature on June&nbsp;30, 2008 and required
mandatory reductions in principal amounts outstanding through
its term. Additionally, the SunTrust Agreement provided for a
revolving loan component (the SunTrust Revolver) not to exceed
$6,000 that was due to mature on April&nbsp;30, 2008.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The SunTrust Agreement required the Company to comply with
certain financial and non-financial covenants. The Company
believes it was in compliance with all covenant requirements at
December&nbsp;31, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the execution of the Senior Secured Credit
Facility described below, in April 2005, the Company wrote-off
approximately $1,117 of unamortized deferred financing costs
paid in connection with the original execution of the SunTrust
Agreement. The write-off of theses costs is included as a
component of
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-45

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
interest expense in the accompanying condensed consolidated
statements of operations for the indicated periods.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Senior Secured Credit Facility</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;28, 2005, the Company executed an amended and
restated agreement with a new syndicate of lenders and Lehman
Commercial Paper Inc. serving as administrative agent (the
Senior Secured Credit Facility). In connection with the
execution of the amended and restated agreement, the Company
consolidated the borrowings under its existing Credit Agreement
and SunTrust Agreement into a single credit facility and
increased the borrowing capacity available under the facility to
$205,000.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Senior Secured Credit Facility consists of a $40,000
Revolving Credit Facility (the Senior Secured Credit Facility
Revolver) and a $165,000 term loan (the Senior Secured Credit
Facility Term Loan). Borrowings under the Senior Secured Credit
Facility are secured by substantially all the assets of the
merged Express and Family Centers.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Senior Secured Credit Facility Term Loan requires quarterly
principal payments of approximately 0.25% of the principal
balance through March&nbsp;31, 2011 and a balloon payment of
approximately 94.25% of the principal balance due upon maturity
on April&nbsp;28, 2011. The Senior Secured Credit Facility
Revolver is payable in full upon maturity on April&nbsp;28, 2009
with periodic interest repayment requirements. The Senior
Secured Credit Facility Term and Revolver loans bear interest
based on predetermined pricing grids which allow the Company to
choose between a &#147;Base Rate&#148; or &#147;Eurodollar&#148;
loan (as defined in the Senior Secured Credit Facility).
Interest is payable quarterly for Base Rate Loans and the
applicable interest period on Eurodollar Loans. As of
September&nbsp;30, 2005 the weighted average borrowing rate was
6.7% for the Senior Secured Credit Facility Term Loan and 6.4%
for the Senior Secured Credit Facility Revolver. Additionally,
the Senior Secured Credit Facility requires the Company to pay a
quarterly fee of 0.5%&nbsp;per annum on the average available
revolving commitment. Letters of credit outstanding under this
agreement as of September&nbsp;30, 2005 totaled approximately
$7,900. Amounts available under the Senior Secured Credit
Facility Revolver as of September&nbsp;30, 2005 totaled $24,150.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Senior Secured Credit Facility requires the Company to
comply with certain financial and non-financial covenants.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>SunTrust ABL Revolver</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On May&nbsp;2, 2005 the Company entered into a $250,000 asset
based senior revolving credit facility with a syndicate of
lenders led by SunTrust Bank as administrative agent to finance
ongoing working capital, capital expenditures and general needs
of the Refinery. This agreement (the SunTrust ABL Revolver)
which matures on April&nbsp;29, 2009, bears interest based on
predetermined pricing grids which allow the Company to choose
between a &#147;Base Rate&#148; or &#147;Eurodollar&#148; loan
(as defined in the SunTrust ABL Revolver). Interest is payable
quarterly for Base Rate loans and the applicable interest period
on Eurodollar loans. Availability under the SunTrust ABL
Revolver is determined by a borrowing base defined in the
SunTrust ABL Revolver, supported primarily by certain accounts
receivable and inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Additionally, the SunTrust ABL Revolver supports the
Company&#146;s issuances of letters of credit in connection with
the purchases of crude oil for use in the refinery process that
at no time may exceed the aggregate borrowing capacity available
under the SunTrust ABL Revolver. As of September&nbsp;30, 2005
the Company had no outstanding borrowings under the agreement
but had letters of credit outstanding totaling
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-46

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
approximately $178,000. Amounts available under the SunTrust ABL
Revolver as of September&nbsp;30, 2005 totaled $72,000.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The SunTrust ABL Revolver contains certain negative covenants
and pledges which prohibit the Company from creating, incurring
or assuming any liens, mortgages, pledges, security interests or
other similar arrangements against the property, plant and
equipment of the Refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Under the SunTrust ABL Revolver, the Company is subject to
certain financial and non-financial covenants.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the SunTrust ABL revolver, Delek Group
executed a $5,000 guaranty in favor of the lenders. In return,
the Company agreed to pay Delek Group guarantee fees equal to
1.5%&nbsp;per year of the guaranteed amount. The lenders
terminated the guaranty on October&nbsp;1, 2005.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Israel Discount Bank Note</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;26, 2005, the Company entered into a $30,000
promissory note with Israel Discount Bank of New York (Israel
Discount Bank Note). The proceeds of this note were used to fund
a portion of the Refinery acquisition discussed in note&nbsp;3.
The Israel Discount Bank Note matures on April&nbsp;30, 2007 and
bears interest, payable quarterly, at a spread of 1.375% over
the 90&nbsp;day London Inter Bank Offering Rate (LIBOR), with
the first interest payment due on April&nbsp;30, 2006. As of
September&nbsp;30, 2005 the weighted average borrowing rate on
the Israel Discount Bank Note was 5.04%.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Bank Leumi Note</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;27, 2005, the Company entered into a $20,000
promissory note with Bank Leumi USA (Bank Leumi Note). The
proceeds of this note were used to fund a portion of the
Refinery acquisition discussed in note&nbsp;3. The Bank Leumi
Note matures on April&nbsp;27, 2007 and bears interest, payable
quarterly, at a spread of 1.375% over the LIBOR Rate (Reserve
Adjusted) for a three month term, with the first interest
payment due on April&nbsp;30, 2006. As of September&nbsp;30,
2005 the weighted average borrowing rate on the Bank Leumi Note
was 5.06%.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Related Party Letters of Credit</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of September&nbsp;30, 2005, the Company had letters of credit
for fuel purchases totaling $9,500 issued in the Company&#146;s
favor by Delek Fuel.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Guarantee Fees</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the execution of the Credit Agreement, Delek
Fuel entered into a limited guarantee for the benefit of the
Company and in favor of Leumi and Hapoalim. The general terms of
the guarantee required Delek Fuel to guarantee a significant
amount in the event the Company was unable to perform its
payment obligations under the Credit Agreement. The Guarantee
was due to expire on the earlier of July&nbsp;1, 2011 or the
complete payment satisfaction of all amounts outstanding under
the Credit Agreement. In May 2004, the Company and Delek Fuel
agreed that the Company would pay Delek Fuel a fee for the
guarantee in the amount of $150&nbsp;per quarter. Further the
Company and Delek Fuel agreed that the payment of this fee would
be effective July&nbsp;1, 2003. However, during June 2004, the
Company and Delek Fuel terminated the fee agreement effective
April&nbsp;1, 2004. Subsequently, during September 2004, Delek
Fuel agreed to forgive the
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-47

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Company of the guarantee fee earned July&nbsp;1, 2003 through
March&nbsp;31, 2004 and these fees were subsequently reversed.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the issuances of the Israel Discount Bank
Note and Bank Leumi Note, Delek Group entered into a limited
guarantee for the benefit of the Company and in favor of Israel
Discount Bank of New York and Bank Leumi USA. The general terms
of the guarantee require Delek Group to guarantee a significant
amount in the event the Company is unable to perform its payment
obligations under the indicated notes. The guarantee expires in
April 2007 or earlier in the event the complete payment
satisfaction of all amounts outstanding under the indicated
notes have been met. In exchange for the guarantee, the Company
has agreed to pay Delek Group an annual fee equal to 1.5% of the
guaranteed amount during the term of the guarantee.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Capital Lease Obligations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In connection with the WOC acquisition on April&nbsp;30, 2004,
discussed in note&nbsp;3, the Company assumed certain capital
lease obligations for equipment with two financial institutions.
The leases had original maturity dates ranging from
September&nbsp;15, 2005 to March&nbsp;23, 2007 and included
provisions for monthly payments of principal and interest at
rates ranging from 9.40% to 11.54%. In June 2005, in connection
with Family Centers&#146; merger into and with Express, all
amounts owed under the capital lease obligations were repaid and
the leases terminated.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Derivative Instruments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has entered into multiple interest rate swap
agreements on $19,200 of notional principal amounts and multiple
interest rate cap agreements on $145,000 of notional principal
amounts as of September&nbsp;30, 2005 and December&nbsp;31,
2004. These agreements are intended to economically hedge
floating rate debt relating to the Company&#146;s current
borrowings under the Senior Secured Credit Facility and previous
indebtedness under the Company&#146;s Credit Agreement and
SunTrust Agreement, discussed above. However, as the Company has
elected to not comply with the requirements, including formal
hedge designation and documentation, to apply hedge accounting
treatment in accordance with the provisions of
SFAS&nbsp;No.&nbsp;133, the Company is recording the fair value
of the derivatives in the balance sheet with the offsetting
entry to earnings. The derivative instruments mature on various
dates ranging from January 2006 through July 2010. The estimated
fair value of the Company&#146;s interest rate swap and interest
rate cap agreements at September&nbsp;30, 2005, and
December&nbsp;31, 2004 totaled $2,935 and $1,921, net,
respectively, and was recorded in other noncurrent assets in the
accompanying condensed consolidated balance sheets.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;133, as amended, the
Company recorded non-cash interest (income) expense representing
the change in estimated fair value of the interest rate swap and
interest rate cap agreements of ($1,014) and $875, respectively,
for the nine-month periods ended September&nbsp;30, 2005 and
2004.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>8.</B></TD>
    <TD>
    <B>Related Parties</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In August of 2004, an officer executed a promissory note in
favor of the Company in the amount of $100. In November 2005, in
connection with an amendment of the officer&#146;s employment
agreement, the officer executed an additional promissory note in
the amount of $100 in favor of the Company. These promissory
notes bear no interest and are payable in full upon termination
of the officer&#146;s employment with the Company.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-48

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of May&nbsp;1, 2005, the Company entered into a consulting
agreement with Greenfeld-Energy Consulting, Ltd., a company
owned and controlled by one of the Company&#146;s directors.
Pursuant to the consulting agreement the Company compensated
Greenfeld-Energy Consulting, Ltd. approximately $7.0 per month
from May through August 2005 and approximately $8.0 per month
commencing September 2005, plus reasonable expenses for
consulting services relating to the refining industry performed
personally by the director. The agreement continues in effect
until terminated by either party upon six months advance notice
to the other party.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In June 2005, in connection with the Company&#146;s refinery
operations, Delek Group guaranteed certain of the Company&#146;s
obligations to one of the Company&#146;s vendors at the
Refinery, in consideration of which the Company agreed to pay
Delek Group guarantee fees of $12.5 per month for every calendar
month during the quarter in which the Company incurs debt that
is subject to the guaranty.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In August 2005, in connection with the Company&#146;s forward
contract activities, Delek Group guaranteed certain of the
Company&#146;s obligations up to $25,000. In consideration of
that guaranty, the Company agreed to pay Delek Group quarterly
fees based on 1.5%&nbsp;per year of the average quarterly
exposure to Delek Group as a result of the Company&#146;s
forward contract activities. The guaranty was terminated
effective as of January&nbsp;1, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Affiliates of the Company provide guarantees to various vendors
supporting the Company&#146;s fuel purchasing activities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>9.</B></TD>
    <TD>
    <B>Environmental Commitments and Contingencies</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Prior to the Company&#146;s purchase of the Refinery on
April&nbsp;29, 2005, the Refinery was the subject of various
state and federal proceedings relating to environmental
regulations, conditions and inquiries, including the Consent
Agreement and Administrative Order discussed below. The former
owner of the Refinery is responsible for payment of any fines or
penalties that may result from settlement of these actions.
However, the Company will have financial and operating
responsibility for implementing required actions to correct
identified deficiencies.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As is the case with most companies engaged in similar
industries, the Company faces potential exposure to future
claims and lawsuits involving environmental matters. The matters
include soil and water contamination, air pollution, personal
injury and property damage allegedly caused by substances which
the Company manufactured, handled, used, released or disposed.
While it is often extremely difficult to reasonably quantify
future environmental related expenditures, the Company
anticipates that continuing capital investments will be required
over the next several years to comply with existing regulations.
Based upon environmental evaluations performed by third parties
subsequent to the Company&#146;s purchase of the Refinery, the
Company has recorded a liability of $7,932 as of
September&nbsp;30, 2005 relative to the probable estimated costs
of remediating certain environmental issues of a non-capital
nature which were assumed in connection with the Company&#146;s
acquisition of the Refinery discussed in note&nbsp;3. This
liability includes estimated costs for on-going remediation
efforts for known and potential contaminations of soil and
groundwater which were already being performed by the previous
owner, as well as estimated costs for additional issues which
have been identified and self reported by the Company subsequent
to the purchase. Approximately $433 of the undiscounted
liability is expected to be expended within the next year with
the remaining balance of $7,499, expendable within the next ten
years. Other than the matters discussed above for which the
Company has recorded a liability and the two environmental
enforcement actions discussed below, the Company has not been
named as defendant in any environmental, health or safety
related litigation.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-49

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In February 2005, the prior Refinery owner settled an alleged
violation with the Texas Commission on Environmental Quality
(TCEQ)&nbsp;regarding H2S in the fuel gas system and excess
SO<SUB style="font-size: 85%; vertical-align: text-bottom">2</SUB>
emissions at the Refinery. The former owner paid a penalty and
agreed to take actions to reduce H2S concentrations in the fuel
gas burned by the refinery flares, but did not complete the
actions required by the Administrative Order by the time the
Company consummated the purchase of the Refinery. Consequently,
the Company became responsible for ensuring these actions are
completed in the near future. As these costs are considered
capital in nature, the Company has not accrued any portion of
these costs currently.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In late 2004, the prior Refinery owner began Consent Agreement
negotiations with the Environmental Protection Agency
(EPA)&nbsp;and Department of Justice with respect to a
settlement of issues concerning the application of air quality
requirements to past and future operations at the Refinery. It
is expected that a final settlement will be reached by the end
of 2005. Although the prior owner is responsible for payment of
any penalties resulting for the period prior to the
Company&#146;s purchase of the Refinery, the Consent Agreement
will require the Company to make investments at the Refinery,
including the installation of a new electrical substation that
will increase operational reliability and construction of
additional sulfur removal capacity. As these costs are
considered capital in nature, the Company has not accrued any
portion of these costs currently. In addition, the Consent
Decree is expected to require certain on-going operational
changes that will increase future operating expenses at the
Refinery.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Federal Clean Air Act (CAA)&nbsp;authorizes the EPA to
require modifications in the formulation of the refined
transportation fuel products the Company manufactures in order
to limit the emissions associated with their final use. In
December 1999, the EPA promulgated national regulations limiting
the amount of sulfur to be allowed in gasoline at future dates.
The EPA believes such limits are necessary to protect new
automobile emission control systems that may be inhibited by
sulfur in the fuel. The new regulations required the phase-in of
gasoline sulfur standards beginning in 2004, with special
provisions for small refiners or those receiving a waiver. The
Company received a waiver from the EPA that postpones
requirements for the lowest sulfur standards until 2007 or 2008,
depending on the specific compliance options chosen under the
agreement with the EPA.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The EPA promulgated regulations that will limit the sulfur
content of highway diesel fuel beginning in 2006 to 15
parts-per-million (ppm). The current standard is 500&nbsp;ppm.
In June 2004, the EPA issued new regulations that will limit
emissions from diesel fuel powered engines used in non-road
activities such as mining, construction, agriculture, railroad
and marine and will simultaneously limit the sulfur content of
diesel fuel used in these engines to facilitate compliance with
the new emission standards. The regulations provide for a timed
phase-in of the non-road low sulfur requirements extending
beyond the on-road diesel deadlines. As required by the gasoline
sulfur waiver from the EPA, the Company plans to meet the
ultimate 15&nbsp;ppm standard for at least 95% of the on-road
highway diesel fuel and the non-road diesel fuel manufactured by
June&nbsp;1, 2006.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The TCEQ has promulgated regulations requiring the use of only
Low Emission Diesel (LED)&nbsp;in counties east of Interstate 35
beginning in October, 2005. The Company has received approval to
meet these requirements for diesel sales east of I-35 by selling
diesel that meets the federal ultra-low sulfur requirements,
ahead of the federally required schedule. Additional diesel
volumes that meet the LED requirements may be manufactured using
fuel additives approved by the TCEQ.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Comprehensive Environmental Response, Compensation and
Liability Act (CERCLA), also known as &#147;Superfund,&#148;
imposes liability, without regard to fault or the legality of
the original conduct, on certain classes of persons who are
considered to be responsible for the release of a
&#147;hazardous substance&#148; into the
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-50

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>DELEK&nbsp;US HOLDINGS, INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Subsidiary of Delek Group Ltd.)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(In thousands, except share and per share data)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>September&nbsp;30, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
environment. These persons include the owner or operator of the
disposal site or sites where the release occurred and companies
that disposed or arranged for the disposal of the hazardous
substances. Under CERCLA, such persons may be subject to joint
and several liabilities for the costs of cleaning up the
hazardous substances that have been released into the
environment, for damages to natural resources and for the costs
of certain health studies. It is not uncommon for neighboring
landowners and other third parties to file claims for personal
injury and property damage allegedly caused by hazardous
substances or other pollutants released into the environment.
Analogous state laws impose similar responsibilities and
liabilities on responsible parties. In the course of the
Company&#146;s current ordinary operations, the Company has
generated waste, some of which falls within the statutory
definition of a &#147;hazardous substance&#148; and some of
which may have been disposed of at sites that may require
cleanup under Superfund. At this time the Company has not been
named a party at any Superfund sites and under the terms of the
purchase agreement, did not assume any liability for wastes
disposed of prior to the Company&#146;s ownership of the Tyler
Refinery and related pipeline.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>10.</B></TD>
    <TD>
    <B>Employment Agreement</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company maintains an employment agreement with an executive
officer which contains a deferred compensation element. Based on
the agreement, the officer is entitled to one, but not both, of
the issuance of shares pursuant to share purchase rights or a
cash award. The share purchase rights award totals 5% of the
Company&#146;s outstanding shares and vests ratably over the
five-year period of the agreement, but is contingent upon the
Company completing an initial public offering during the five
year period ending April&nbsp;30, 2009. As the exercise of these
share purchase rights is contingent on the completion of an
initial public offering, in accordance with Accounting
Principles Board No.&nbsp;25, <I>Accounting for Stock Issued to
Employees, </I>compensation expense will only be recognized upon
satisfaction of the contingency. Accordingly, upon completion of
an initial public offering, compensation expense would be
recorded for the vested portion of the share purchase rights
based on the five-year vesting period and calculated as the
difference in the stipulated exercise price and the fair value
of the award on that date.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As long as the Company does not complete an initial public
offering, the officer is entitled to a cash award which may not
exceed $3,000 over the five year period dependent on the
Company&#146;s performance. The Company has accrued
approximately $400 under this agreement as of September&nbsp;30,
2005.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>11.</B></TD>
    <TD>
    <B>Subsequent Event</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2005, the Company acquired 21&nbsp;convenience
stores and four undeveloped properties in the Nashville market
from BP Products North America Inc. (BP Acquisition). Total
consideration paid for the BP Acquisition approximated $35,027.
In connection with this acquisition, the Company increased the
Senior Secured Credit Facility Revolver by $30,000 to $70,000.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-51

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='315'></A>
</DIV>

<!-- link1 "REPORT OF INDEPENDENT AUDITORS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>REPORT OF INDEPENDENT AUDITORS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
To the Stockholders of Crown Central Petroleum Corporation
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have audited the accompanying combined balance sheets of the
Tyler Refinery and McMurrey Pipeline operations (the
Company&nbsp;&#151; a business component of Crown Central
Petroleum Corporation) as of December&nbsp;31, 2004 and 2003 and
the related combined statements of operations, changes in
owner&#146;s net investment and cash flows for each of the three
years in the period ended December&nbsp;31, 2004. These
financial statements are the responsibility of the
Company&#146;s management. Our responsibility is to express an
opinion on these financial statements based on our audits.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We conducted our audits in accordance with auditing standards
generally accepted in the United States. Those standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. We were not engaged to perform an audit
of the Company&#146;s internal control over financial reporting.
Our audits included consideration of internal control over
financial reporting as a basis for designing audit procedures
that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the
Company&#146;s internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by
management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In our opinion, the combined financial statements referred to
above present fairly, in all material respects, the combined
financial position of the Tyler Refinery and McMurrey Pipeline
operations at December&nbsp;31, 2004 and 2003, and the combined
results of their operations and their cash flows for each of the
three years in the period ended December&nbsp;31, 2004, in
conformity with accounting principles generally accepted in the
United States.
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="40%"></TD>
    <TD width="60%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    /s/ Ernst &#38; Young LLP</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Baltimore, Maryland
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
December&nbsp;21, 2005
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-52

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='316'></A>
</DIV>

<!-- link1 "COMBINED BALANCE SHEETS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>COMBINED BALANCE SHEETS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<I>(Thousands of dollars)</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 18pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="69%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31,</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="11" align="center" valign="top">
    <B>ASSETS</B></TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable, less allowance for doubtful accounts</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (2004&nbsp;&#151; $1,148; 2003&nbsp;&#151; $1,052)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>86,055</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>68,927</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventories, net of LIFO reserves (2004&nbsp;&#151; $21,183;
    2003&nbsp;&#151; $10,625)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,945</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40,743</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid crude inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53,279</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,489</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,952</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current deferred tax assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,361</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,683</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>185,129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>117,306</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred turnaround</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,024</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,197</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property, plant and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Land</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>539</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum refineries</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>23,826</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34,397</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Marketing facilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>994</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,129</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Furniture and other equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,560</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,459</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>38,625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less allowance for depreciation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,220</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,445</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net property, plant and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,239</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31,180</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,058</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>203,392</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>159,741</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="11">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="11" align="center" valign="top">
    <B>LIABILITIES AND OWNER&#146;S NET INVESTMENT</B></TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil and refined products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$57,294</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$96,710</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,111</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,923</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,607</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,093</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,012</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>109,726</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,554</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,360</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other deferred liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,174</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,307</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total owner&#146;s net investment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,652</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32,348</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and owner&#146;s net investment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>203,392</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>159,741</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<I>See accompanying notes.</I>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-53

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='317'></A>
</DIV>

<!-- link1 "COMBINED STATEMENTS OF OPERATIONS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>COMBINED STATEMENTS OF OPERATIONS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<I>(Thousands of dollars)</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="67%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Revenues</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sales and operating revenues</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>703,994</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>349,026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>337,411</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sales to affiliated party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>135,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>320,612</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>297,176</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>839,212</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>669,638</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>634,587</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Operating costs and expenses</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Costs of sales and operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>664,224</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>331,258</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>325,436</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of sales to affiliated party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>131,854</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>321,589</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>296,878</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Selling and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,074</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,466</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,784</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,891</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,958</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on sales and abandonments of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(95</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Impairment loss on property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,301</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>821,249</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>663,271</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>631,411</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,963</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,367</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,176</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest and other income, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,221</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,662</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,968</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income before tax</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20,184</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,029</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,144</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,987</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,979</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,590</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$13,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,554</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<I>See accompanying notes.</I>
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-54

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(a Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='318'></A>
</DIV>

<!-- link1 "COMBINED STATEMENTS OF CHANGES IN OWNER&#146;S NET INVESTMENT" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>COMBINED STATEMENTS OF CHANGES IN OWNER&#146;S NET
INVESTMENT</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<I>(Thousands of dollars, except share amounts)</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="43%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retained</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Accumulated</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Total</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owner&#146;s</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Earnings/</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Other</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Owner&#146;s</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Net</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Accumulated</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Comprehensive</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Net</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Investment</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Deficit</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Income/Loss</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Investment</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance at December&nbsp;31, 2001</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$63,115</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(24,528</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$38,587</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comprehensive income (loss):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income for 2002</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,554</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,554</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjustment to minimum pension liability (net of tax of $1,538)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,509</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,509</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comprehensive income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,045</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net transactions with owner</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,595</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,595</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance at December&nbsp;31, 2002</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(19,974</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,509</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>38,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comprehensive income (loss):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income for 2003</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,050</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjustment to minimum pension liability (net of tax of $13)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(21</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(21</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comprehensive income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,029</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net transactions with owner</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10,718</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10,718</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance at December&nbsp;31, 2003</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>49,802</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(14,924</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,530</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32,348</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comprehensive income (loss):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income for 2004</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,197</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjustment to minimum pension liability (net of tax of $465)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(759</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(759</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Comprehensive income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>12,438</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net transactions with owner</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>70,866</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>70,866</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Balance at December&nbsp;31, 2004</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$120,668</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(1,727</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(3,289</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$115,652</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-55

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(a Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='319'></A>
</DIV>

<!-- link1 "COMBINED STATEMENTS OF CASH FLOWS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>COMBINED STATEMENTS OF CASH FLOWS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<I>(Thousands of dollars)</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="64%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from operating activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$13,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,554</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Reconciling items from net income to net cash used in operating
    activities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,891</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,958</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Impairment loss on property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,301</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net gain on sales of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(95</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred income tax expense/(benefit)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(9,019</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(969</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,237</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other deferred items</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,050</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>577</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,991</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Changes in assets and liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(17,128</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,516</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(24,566</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,798</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,839</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12,316</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid crude inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(53,279</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,521</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(6,302</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(909</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil and refined products payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(39,416</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,506</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,774</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,188</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>905</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>120</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued liabilities and other deferred liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,936</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,360</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,070</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash (used in) provided by operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(68,155</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,408</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,812</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from investing activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital expenditures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,807</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,255</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,576</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from sales of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred turnaround maintenance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,527</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash used in investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,712</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,782</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,576</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from financing activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net transactions with owner</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>70,866</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10,718</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,595</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by (used in) financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>70,866</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10,718</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,595</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Net decrease in cash and cash equivalents</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(92</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(359</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash and cash equivalents at beginning of year</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>93</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>452</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash and cash equivalents at end of year</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$93</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Supplemental disclosures of cash flow information</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash paid during the year for:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Incomes taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>893</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>181</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>193</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-56

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='320'></A>
</DIV>

<!-- link1 "NOTES TO COMBINED FINANCIAL STATEMENTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Description of Business and
Summary of Accounting Policies</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Basis of Presentation</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The accompanying financial statements have been prepared from
Crown Central Petroleum Corporation&#146;s (Crown) historical
accounting records and represent the combined financial
position, results of operations and cash flows reflecting
assets, liabilities, and operations of Crown&#146;s Tyler
Refinery and McMurrey Pipeline operations (the Company). The
disclosures in the notes to the combined financial statements
relate solely to those assets and exclude all other Crown
operations. As more fully described below, the combined
financial statements for all periods presented include
allocations of Crown corporate and general administrative
expenses. For financial reporting purposes, the net intercompany
financing activities of the Company and Crown have been
accumulated into a single caption entitled &#147;owner&#146;s
net investment.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Locot Corporation (Locot), is a wholly-owned subsidiary of
Crown, which is a wholly owned subsidiary of Rosemore Holdings,
Inc., which in turn is a wholly owned subsidiary of Rosemore,
Inc. (Rosemore). Crown and Locot are the parent companies of
La&nbsp;Gloria Oil and Gas Company (La&nbsp;Gloria), which owns
and operates the Tyler Refinery, and through a subsidiary, the
McMurrey pipeline gathering system in Texas.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The financial statements of the Company are not necessarily
indicative of the financial position, results of operations and
cash flows that might have occurred had the Company not been
integrated into Crown&#146;s other operations. Also, they may
not be indicative of the actual financial position that might
have otherwise resulted, or of future results of operations or
financial position of the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Description of
Business</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company operates as an independent refiner and marketer of
petroleum products, including petrochemical feedstocks. The
Company operates a refinery in Tyler, Texas with a rated
capacity of 52,000 barrels per day (BPD) of crude oil. There was
no debt directly related to the Tyler Refinery, as such, no
interest expense was allocated to it.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
There were 219, 226, and 239 employees at December&nbsp;31,
2004, 2003, and 2002, respectively. Approximately two-thirds of
the Tyler Refinery employees are subject to collective
bargaining agreements. The Company&#146;s collective bargaining
agreement with the Paper, Allied-Industrial, Chemical and Energy
Workers International Union (PACE), covering employees at the
Tyler Refinery expired on March&nbsp;31, 2004. However, the
parties have agreed to a series of extensions that continue the
terms of the contract through December&nbsp;31, 2005.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As more fully described in Note&nbsp;10 to these financial
statements, on March&nbsp;14, 2005, La&nbsp;Gloria executed a
Purchase and Sale Agreement for the sale of the Company (the
Tyler Refinery and McMurrey Pipeline). Under the terms of the
agreement, the buyer offered to employ most of the
Company&#146;s employees at the facilities and will recognize
the unions by whom certain of the Company&#146;s employees at
the Refinery are represented. La&nbsp;Gloria completed the sale
of the Company on April&nbsp;29, 2005 for $16.6&nbsp;million
plus the value of the remaining inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following summarized the significant accounting policies and
practices followed by the Company:
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Use of Estimates</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those
estimates.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-57

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Allocation of Costs from
Crown</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The financial statements reflect a charge from Crown for the
estimated costs of certain functions that are managed by the
parent and can reasonably be directly attributed to the
operation of the Company. These costs include corporate senior
management, human resources, legal, accounting and
information-system support. The charges are based on
management&#146;s estimate of such services specifically used by
the Company. The determination of cost was based on methods and
criteria that management believes are equitable and provide a
reasonable estimate of the cost attributable to the Company. The
total of these allocations for the years ending
December&nbsp;31, 2004, 2003, and 2002 were $3.5&nbsp;million,
$3.6&nbsp;million, and $3.8&nbsp;million, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Cash and Cash Equivalents</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Cash in excess of daily requirements is invested in marketable
securities with maturities of three months or less. Such
investments are deemed to be cash equivalents for purposes of
the Statements of Cash Flows. Cash with restrictions on usage
are not deemed to be cash equivalents for purposes of the
Balance Sheets and the Statements of Cash Flows. During 2003,
Crown began to centralize all cash management and subsequently
all Company bank accounts were closed. All subsequent cash
receipts and disbursements were transacted using Crown&#146;s
bank accounts.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Accounts Receivable</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The majority of the Company&#146;s accounts receivable relate to
sales of petroleum products to third parties operating in the
petroleum industry. As of December&nbsp;31, 2004 and 2003, one
independent customer balance comprised 32.8% and 32.0%,
respectively, of the Company&#146;s gross accounts receivable.
Accounts receivable are recorded at the amounts billed to the
customers less an allowance for those balances that management
estimates may ultimately not be collected. The allowance for
doubtful accounts is determined by specific identification of
potentially uncollectible accounts.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Credit Risk</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company evaluates the credit worthiness counterparties to
futures, forwards, and exchange traded options and as a result
considers non-performance credit risk to be remote. The amount
of exposure with such counterparties is generally limited to
unrealized gains on outstanding contracts. The Company is also
exposed to credit risk of counterparties to product exchange
transactions. The Company evaluates the credit worthiness of its
product exchange counterparties and considers non-performance
credit risk to be remote.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Inventories</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s crude oil and refined products are valued at
the lower of cost (last-in, first-out) or market. Materials and
supplies inventories are valued at cost. Incomplete exchanges of
crude oil and refined products due the Company or owing to other
companies are reflected in the inventory accounts. Prepaid crude
inventory represents advance payments for future crude
deliveries and is valued at the lower of cost (on a first-in,
first-out basis) or market and is not considered in the last-in,
first-out basis until the crude is physically received by the
Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Other Assets</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Other current assets as of December&nbsp;31, 2004 and Other
Assets as of December&nbsp;31, 2003 include a $6.1&nbsp;million
refundable deposit with an insurance carrier. As discussed
further in Note 10, subsequent to the
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-58

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
year ended December&nbsp;31, 2004, La Gloria executed a purchase
and sale agreement for sale of Company (the Tyler Refinery and
McMurrey Pipeline assets) and Crown collected the refundable
deposit.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Property, Plant and Equipment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Property, plant and equipment is carried at cost. Depreciation
and amortization of plant and equipment are primarily provided
using the straight-line method over estimated useful lives.
Construction in progress is recorded in property, plant and
equipment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Expenditures that materially increase values, change capacities
or extend useful lives are capitalized in property, plant and
equipment. Routine maintenance, repairs and replacement costs
are charged against current operations.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Upon sale or retirement, the costs and related accumulated
depreciation or amortization are eliminated from the respective
accounts and any resulting gain or loss is included in operating
results.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with Statement No. 144, <I>Accounting for the
Impairment or Disposal of Long-Lived Assets</I> (Statement No.
144), the Company records impairment losses on long-lived assets
used in operations when events and circumstances indicate that
long-lived assets might be impaired and the undiscounted cash
flows estimated to be generated by those assets are less than
the carrying amounts of those assets. At December&nbsp;31, 2004,
indications of value derived from marketing the assets for sale
and difficulties in finding a financially capable buyer for the
Tyler Refinery asset group were indicators that it was
potentially impaired. On March&nbsp;14, 2005, La Gloria executed
a Purchase and Sale Agreement for the sale of the Company. The
sales price less costs to sell was less than the carrying value
of the assets at December&nbsp;31, 2004. While this agreement to
sell the Tyler Refinery asset group was contingent upon several
factors, including but not limited to the buyer&#146;s due
diligence, approval of the transaction under the Hart-Scott
Rodino Act, receipt by the buyer of an EPA Hardship Waiver
pertaining to gasoline sulphur standards, and other requisite
consents, licenses and approvals, it was the most objective
representation of the fair value of the Tyler Refinery asset
group available at the time. Accordingly, as required by
statement. No 144, the Tyler Refinery and McMurrey Pipeline
assets were written down by approximately $15.3&nbsp;million at
December&nbsp;31, 2004 to reflect the estimated fair market
value of the assets. Subsequent to March&nbsp;14, 2005, on
April&nbsp;29, 2005, la Gloria completed its sale of the Company
assets for $16.6&nbsp;million plus the value of the remaining
inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation expenses related to property, plant and equipment
were approximately $2.7&nbsp;million, $2.9&nbsp;million and
$2.8&nbsp;million in the years ended December&nbsp;31, 2004,
2003, and 2002, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Refinery Turnaround Costs</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Refinery turnaround costs are incurred in connection with the
Company&#146;s planned shutdown and inspection of the
refineries&#146; major units to perform necessary repairs and
replacements. Refinery turnaround costs are deferred when
incurred and amortized on a straight-line basis over that period
of time estimated to lapse until the next planned turnaround
occurs. The frequency of refinery turnarounds varies with each
operating unit. Refinery turnaround costs include, among other
things, the cost to repair, restore, refurbish or replace
refinery equipment such as vessels, tanks, reactors, piping,
rotating equipment, instrumentation, electrical equipment, heat
exchangers and fired heaters.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Turnaround amortization expenses were approximately
$3.1&nbsp;million, $3.0&nbsp;million, and $2.5&nbsp;million in
the years ended December&nbsp;31, 2004, 2003, 2002, respectively.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-59

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Environmental Costs</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The company conducts environmental assessments and remediation
efforts at the Tyler Refinery and McMurrey Pipelines facilities.
Estimated closure and post-closure costs for active refineries
are not recorded until a decision for closure is made. Estimated
closure and post-closure costs and costs of environmental
matters related to ongoing refinery operations are recorded as
follows: Expenditures for equipment necessary for environmental
issues relating to ongoing operations are capitalized. The
Company accrues environmental and clean-up related costs of a
non-capital nature when it is both probable that a liability has
been incurred and that the amount can be reasonably estimated.
Accruals for losses from environmental remediation obligations
generally are recorded no later than completion of the
remediation feasibility study. Estimated costs, which are based
upon experience and assessments, are recorded at undiscounted
amounts without considering the impact of the inflation, and are
adjusted periodically as additional or new information becomes
available.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Income Taxes</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The operations of the Company are included in the consolidated
federal income tax return of Crown. For financial reporting
purposes, the Company has calculated income tax expenses
attributable to its operations using the separate return method.
Under this method, the Company has assumed that it is a separate
taxpayer in each jurisdiction in which it conducts operations.
Income taxes attributable to the Company&#146;s operations that
were paid or accrued by Crown are included as a component of
owner&#146;s net investment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets
and liabilities are measured using enacted rates expected to
apply to taxable income in the years that those temporary
differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the
enactment date. A valuation allowance is recognized if, based on
managements judgment, it is more-likely-than-not that some
portion, or all, of the deferred tax asset will not be realized.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Asset Retirement Obligations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective January&nbsp;1, 2003, the Company adopted the
provisions of Statement of Financial Accounting Standard
No.&nbsp;143, <I>Accounting for Asset Retirement Obligations
</I>(SFAS&nbsp;No.&nbsp;143). This statement significantly
changed the method of accruing costs that an entity is legally
obligated to incur associated with the retirement of fixed
assets. Under SFAS&nbsp;No.&nbsp;143, the fair value of a
liability of an assets retirement obligation is recognized in
the period in which it is incurred if a reasonable estimate of a
value can be made.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has legal asset retirement obligations for several
assets, including its refinery and pipeline, for which it is not
possible to estimate when the obligations will be settled.
Consequently, the retirement obligations for these assets cannot
be measured at this time
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Owner&#146;s Net Investment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Owner&#146;s net investment consists of Crown&#146;s initial
investment in the Company and subsequent changes in Crown&#146;s
net investment resulting from the use of centralized cash
management accounts. Substantially all payments from the
Company&#146;s customers are received by Crown and substantially
all expenses and fixed asset additions of the Company are paid
by Crown. In addition, Crown allocates corporate general and
administrative expenses to the Company based on the analysis of
the components of the Crown&#146;s corporate general and
administrative expenses and the estimated percentage of each
component attributable to the
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-60

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Company. Corporate general and administrative expense consists
principally of corporate compensation expense. Management
believes that the method used to allocate these expenses is
reasonable. Allocated indirect overhead costs consists
principally of the following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Corporate human resources</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Finance, accounting, legal, and administration;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Information technology management services.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
No interest expenses incurred by Crown for general corporate
debt has been allocated to the Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Sales and Operation Revenues</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Revenues are recognized net of excise and other taxes when
products are sold, delivered and collectibility is reasonably
assured. Resales of crude oil are recorded net of the related
crude oil cost
<FONT style="white-space: nowrap">(first-in,</FONT> first-out)
in sales and operating revenues.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Crude oil and refined product exchange transactions, which are
entered into primarily to acquire crude oil and refined products
of a desired quality or at a desired location, are netted in
cost of products sold and operating expenses in the statements
of operations based upon the concepts set forth in APB Opinion
No.&nbsp;29, <I>Accounting for Nonmonetary Transactions.</I>
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Interest and Other Income, Net</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest and other income, net, primarily consists of
intercompany interest charged by the Company on net amounts due
to the Company from its parent, Crown. Amounts due to the
Company from Crown, including interest, are classified as
Owner&#146;s Net Investment.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Recent Accounting Pronouncements</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In November 2004, the FASB issued Statement of Financial
Accounting Standards No.&nbsp;151, <I>Inventory Costs</I>
(FASB&nbsp;151). The Company is required to adopt the provisions
of FASB&nbsp;151, on a prospective basis, as of January&nbsp;1,
2006. FASB&nbsp;151 clarifies the accounting for abnormal
amounts of idle facility expense, freight, handling costs, and
wasted material. FASB&nbsp;151 requires that those
items&nbsp;&#151; if abnormal&nbsp;&#151; be recognized as
expenses in the period incurred. In addition, FASB&nbsp;151
requires the allocation of fixed production overheads to the
costs of conversions based upon the normal capacity of the
production facilities. The Company has not yet determined what
effect FASB&nbsp;151 will have on its earnings and financial
position.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In March 2005, the FASB issued FASB Interpretation No.&nbsp;47,
<I>Accounting for Conditional Asset Retirement Obligations</I>
(FASB Interpretation No.&nbsp;47), which is an interpretation of
SFAS No.&nbsp;143. This interpretation is effective no later
than the end of fiscal years ending after December&nbsp;15, 2005
and clarifies terminology within FAS&nbsp;143 and requires
companies to recognize a liability for the fair value of a
conditional asset retirement obligation when incurred if the
liability&#146;s fair value can be reasonably estimated. The
impact of the adoption of FASB Interpretation No.&nbsp;47 on the
Company&#146;s financial statements has not yet been determined.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-61

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Inventories consisted of the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="71%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><I>(Thousands of dollars)</I></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$26,361</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$21,449</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refined products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,240</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,920</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total inventories at FIFO (approximates current cost)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>51,601</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>50,369</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    LIFO reserves</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(21,183</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10,625</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total crude oil and refined products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,418</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,744</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Materials and supplies inventory at FIFO</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>999</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total Inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$30,945</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$40,743</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In 2004 and 2003, the Company liquidated a portion of its LIFO
inventory quantities. The impact of these liquidations, based on
the difference between LIFO costs and current costs, resulted in
a reduction in costs and operating expenses of $6.6&nbsp;million
in 2004 and $1.6&nbsp;million in 2003.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>3.</B></TD>
    <TD>
    <B>Credit Arrangements</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Crown maintains a Loan and Security Agreement, as amended
(Secured Credit Facility), which is used to provide cash
borrowings and letters of credit for general corporate and
working capital requirements and was extended until
January&nbsp;24, 2005. The Secured Credit Facility, which is
collateralized by virtually all assets, includes limitations on
additional indebtedness and cash dividends. Effective
December&nbsp;31, 2003, Crown was no longer required to comply
with financial covenants requiring the maintenance of minimum
levels of adjusted working capital, net worth and cash flow.
Crown pays a fee for unused commitments. Cash borrowings under
the Secured Credit Facility are limited to $50 million and bear
interest based on the prime rate. There is no such sub-limit for
the issuance of letters of credit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At December&nbsp;31, 2004, the total commitments within the
Secured Credit Facility were approximately $75&nbsp;million,
with $25&nbsp;million provided by bank participants and
$50&nbsp;million from an affiliate of Rosemore, a related party
to the Company. The bank commitments are subject to the
availability of eligible collateral, which totaled
$132.5&nbsp;million at December&nbsp;31, 2004, after the
application of reserves. The remaining availability, which is
provided by Rosemore, is not subject to the limitation of
eligible collateral. As of December&nbsp;31, 2004, Crown had no
cash borrowings and $34.9&nbsp;million of outstanding letters of
credit issued pursuant to the Secured Credit Facility, with
remaining unused commitments of $40.1&nbsp;million. Cash
borrowings and outstanding letters of credit at
December&nbsp;31, 2003, were $30.4&nbsp;million and
$37.1&nbsp;million, respectively. The Company had no cash
borrowings in any year. Letters of Credit directly attributable
to the Company operations were $30.3&nbsp;million at
December&nbsp;31, 2004 and $26.0 million at December&nbsp;31,
2003.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Secured Credit Facility was amended as of January&nbsp;25,
2005, with the bank participation adjusted to $40&nbsp;million
and Rosemore participations adjusted to $70&nbsp;million for a
total commitment of $110 million. The total bank commitments are
collateralized by 85% of eligible accounts receivables plus the
lesser of, 60% of the value of eligible inventories or
$25&nbsp;million for a combined maximum of $40&nbsp;million. The
remaining availability, which is provided by Rosemore, is not
subject to the limitation of eligible collateral. The maturity
date of the facility is defined as the earlier of
December&nbsp;31, 2005 or the date of closing on the sale of the
Tyler Refinery. No contractual reductions of the Rosemore
participation are provided or contemplated. Fees and expenses
related to the issuances of letters of credit are included in
cost of the materials purchased.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-62

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>4.</B></TD>
    <TD>
    <B>Derivatives and Hedging Activities</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company uses futures, forwards and swaps to manage the price
risk inherent in purchasing crude oil in advance of the delivery
date, and in maintaining the value of inventories contained
within its refinery and pipeline system. The Company&#146;s risk
management policy sets forth the hedging strategies used to
manage the price risks. The strategies include fixing a future
margin between crude oil and certain finished products, and also
hedging fixed price purchase and sale commitments of crude oil
and refined products. These instruments generally allow for
settlement at the end of their term in either cash or product.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS No.&nbsp;133, <I>Accounting for
Derivative Instruments and Hedging Activities</I>, the Company
recognizes all derivatives as either assets or liabilities in
the balance sheet and those instruments are measured at fair
value. Certain derivatives, which are transacted pursuant to the
Company&#146;s risk management policy to manage price risk, do
not qualify or at the Company&#146;s discretion, are not
designated as hedges under Statement No.&nbsp;133. These
contracts are accounted for on the mark-to-market basis of
accounting and as such changes in the fair value of the
derivatives are recorded each period in earnings.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of December&nbsp;31, 2004 and 2003, the Company had recorded
derivatives in its other current assets and crude oil and
refined products payable from operations at the Tyler Refinery
of $2.0&nbsp;million and $0.1&nbsp;million, respectively. For
the years ended December&nbsp;31, 2004, 2003, 2002, the Company
recorded losses of $2.9&nbsp;million, $2.4&nbsp;million, and
$4.7&nbsp;million, respectively, representing the change in the
fair value of the Company&#146;s derivative financial
instruments and hedging activities used to hedge inventory
costs. These amounts were related to operations at the Tyler
Refinery and as such are recognized in costs and operating
expenses in the Combined Statements of Operations. As of
December&nbsp;31, 2004 and 2003 the Company had no derivative
financial instruments designated as hedges.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has fixed-price, firm purchase and sale commitments
for crude and related products that meet the requirements to be
designated as normal purchases or sales transactions and
therefore are not subject to the requirements of SFAS
No.&nbsp;133. The Company specifically designates each firm
commitment as a normal purchase or normal sale upon execution.
No unrealized gains are recognized on firm commitments
designated as normal purchases or normal sales. The Company
evaluates these contracts for lower-of-cost-or-market
implications, and where necessary, provides an allowance to
write-down to market.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>5.</B></TD>
    <TD>
    <B>Employee Benefit Obligations</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Crown has a defined benefit pension plan covering the majority
of the Company&#146;s full-time employees. Plan benefits are
generally based on years of service and on the employee&#146;s
average compensation. Crown&#146;s policy is to fund the pension
plans in amounts that comply with contribution limits imposed by
law. Plan assets consist principally of fixed income securities
and stocks.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In 2003, Crown completed an analysis of its company-sponsored
employee and retiree benefits programs and made the following
changes that affected the Company: 1)&nbsp;The Company has
frozen benefits and participation in its defined benefit pension
plan (Retirement Plan) for all of the Company&#146;s full-time
employees, effective July 1, 2003 resulting in a benefit
obligation reduction from the curtailment of $4.8&nbsp;million.
For the participants covered by the freeze in the Retirement
Plan, only the participant&#146;s compensation and years of
service earned prior to the date of the freeze is considered in
the calculation of the retirement benefit. Participant vesting
continues to accrue based on years of service provided before
and after the freeze on a basis consistent with the Retirement
Plan prior to the freeze. No new Company employees are eligible
to participate in the Retirement Plan after July 1, 2003.
2)&nbsp;The Company eliminated its subsidy for all medical
coverage for retirees, effective August&nbsp;1, 2003. As of that
date, retirees were offered medical coverage but only on a fully
retiree-paid basis.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-63

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The estimated impact of freezing the Retirement Plan for Company
employees was $0.5&nbsp;million reduction in funding for the
Retirement Plan in 2003. Employer contributions to the
Retirement Plan were $1.5&nbsp;million and $0.4&nbsp;million in
2004 and 2003, respectively. It should be noted that the actual
future cash funding requirements and pension expense under
generally accepted accounting principles will be determined
based upon the actual performance of the Retirement Plan&#146;s
assets as compared to the actuarial assumptions used. Pension
related expenses decreased approximately $0.9&nbsp;million in
2004 when compared to the prior year due primarily to a decrease
in the recognition of actuarial losses and a decrease in the
service cost-benefit earned during the year.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a condition of the sale of certain Crown assets unrelated to
the Company, Crown reached an agreement with the Pension Benefit
Guaranty Corporation (PBGC) with respect to the underfunding of
Crown&#146;s Retirement Plan by agreeing to pay $45&nbsp;million
into the Retirement Plan from the proceeds of the Pasadena and
Tyler Refinery sales. In addition, Rosemore assumed sponsorship
of the Plan. A deposit into Crown&#146;s Retirement Plan of
$7.5&nbsp;million was made at the closing of the Pasadena
Refinery in early 2005. The remaining $37.5&nbsp;million will be
paid according to the following schedule: (1)&nbsp;another
deposit of $10&nbsp;million to the Retirement Plan will be made
on June&nbsp;30, 2005, with a final payment of
$27.5&nbsp;million made no later than June&nbsp;30, 2006, or
(2)&nbsp;upon the sale of the Tyler Refinery, whichever occurs
earlier. Effective May&nbsp;6, 2005, all funds due had been
deposited to the Retirement Plan in accordance with the PBGC
agreement.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth the changes in the benefit
obligation and plan assets of the Company&#146;s pension plans
for the years ended December&nbsp;31, 2004 and 2003,
respectively:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="71%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><I>(Thousands of dollars)</I></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Change in pension plans&#146; benefit obligation</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Pension plans&#146; benefit obligation&nbsp;&#151; beginning of
    year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$30,079</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$30,184</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Service cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>122</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>659</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,857</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,951</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Benefits paid</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,299</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,071</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(229</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(124</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Actuarial loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,333</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,332</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Curtailment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,852</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Pension plans&#146; benefit obligation&nbsp;&#151; end of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>31,863</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,079</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Change in pension plan assets</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fair value of plan assets&nbsp;&#151; beginning of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,201</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>19,262</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Actual return on plan assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,881</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,725</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Benefits paid</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,299</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,071</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Contributions</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,519</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>396</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(219</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(111</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fair value of plan assets&nbsp;&#151; end of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>24,083</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,201</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Reconciliation of funded status</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Unfunded status benefit obligation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(7,780</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(7,878</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Unrecognized actuarial loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,091</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Unrecognized net asset at transition</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Unrecognized prior service cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(8</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net amounts recognized at end of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(2,475</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(3,797</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-64

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Amounts recognized in the Balance Sheets consisted of:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="71%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Year Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><I>(Thousands of dollars)</I></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued pension liability</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(7,780</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(7,878</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accumulated other comprehensive income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,305</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,081</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net amounts recognized at end of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(2,475</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(3,797</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other comprehensive income/ (loss) attributable to change in
    additional minimum liability recognition</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,224</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net periodic pension costs consisted of the following components:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="68%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Year Ended December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><I>(Thousands of dollars)</I></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Service cost&nbsp;&#151; benefits earned during the year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$122</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$659</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,011</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest cost on projected benefit obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,857</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,951</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,898</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Expected return on plan assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,988</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,758</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,099</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Amortization of prior service cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(9</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(15</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Recognized actuarial loss/(gain)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>208</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>405</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Curtailment credit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(110</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Amortization of transition asset obligation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(12</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(47</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net periodic pension cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,126</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$748</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Assumptions used in the accounting for the defined benefit plans
as of December&nbsp;31 were:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Weighted average discount rates</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.00%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.25%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6.75%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Rates of increase in compensation levels</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.00%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.00%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3.00%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Expected long-term rate of return on assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.00%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.00%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9.75%</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The 2004 rate increase assumption of 3% relates primarily to
those participants covered by a collective bargaining agreement
that are not subject to the Company&#146;s decision to freeze
the Retirement Plan.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s Retirement Plan projected benefit obligations
and accumulated benefit obligations were $31,863,000 as of
December&nbsp;31, 2004 and $30,079,000 as of December&nbsp;31,
2003. The measurement date used by the Company&#146;s Retirement
Plan was January&nbsp;1st following each calendar year-end.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s Retirement Plan asset allocations at
December&nbsp;31, 2004 and December&nbsp;31, 2003, by asset
category are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="72%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Asset category</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Large cap equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>56.5%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>57.7%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    International equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5.3%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5.2%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Bonds</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>36.5%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35.8%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.7%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1.3%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>100.0%</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-65

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The assumed long-term rate of return is based on
weighted-average expected returns for each asset class. The
9.00% assumption compares favorably to the 10-year historical
weighted average compound return of 10.76% actually achieved by
these assets.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company believes that the Retirement Plan&#146;s risk
posture is, in large part, a function of the asset mix
established for the fund. Based on discussions with its
investment adviser and on its analysis of capital market return
patterns (both historical and expected), the Company considers
the following asset allocation guidelines to be consistent with
the Retirement Plan&#146;s risk posture discussed above:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="62%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Percent of Total Retirement Plan</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>Assets</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Minimum</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Target</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Maximum</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Equity:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Large cap equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    International equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>57</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>60</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>65</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fixed-income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>40</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>43</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>0</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#60;1</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following benefit payments, which reflects expected future
service, as appropriate, are expected to be paid for the
calendar years as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,288,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,397,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,493,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2008</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,592,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2009</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,724,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2010-2014</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,650,000</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition to the defined benefit pension plan, for most of
2003, the Company provided certain health care and life
insurance benefits for eligible employees who retired from
active service. The post-retirement health care plan was
contributory, with retiree contributions consisting of
co-payment of premiums and other cost sharing features such as
deductibles and coinsurance. Beginning in 1998, the Company
&#147;capped&#148; the amount of premiums that it contributed to
the medical plans. As costs exceed this cap, retiree premiums
increase to cover the additional cost. In 2002, the
Company&#146;s post-retirement health care plan was amended to
exclude medical coverage for non-union participants ages 65 and
over. Effective August 1, 2003, the Company eliminated its
subsidy for all medical coverage for retirees. The effect of
this curtailment was a reduction in the accumulated benefit
obligation, a reduction in the accrued benefit liability and a
curtailment gain recorded on the books of Crown. Any curtailment
gain applicable to the Company is included in Cost of sales and
operating expenses in the Statements of Operations. As of August
1, 2003, retirees were offered medical coverage but only on a
fully retiree-paid basis. Therefore, no post-retirement benefit
obligation is recognized in the Company&#146;s financial
statements.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>6.</B></TD>
    <TD>
    <B>Litigation and Contingencies</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has been named as a defendant in various matters of
litigation, some of which are for substantial amounts, and
involve alleged personal injury and property damage from
prolonged exposure to asbestos, silica, petroleum, petroleum
related products, including MTBE, and substances used at its
refinery or in the petroleum refining process. The Company is a
co-defendant with numerous other defendants in a number of these
suits. The Company is vigorously defending these actions;
however, the process of resolving these matters could take
several years. The liability, if any, associated with these
cases was either accrued in
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-66

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
accordance with generally accepted accounting principles or was
not determinable at December 31, 2004. The Company has consulted
with counsel with respect to each such proceeding or large claim
which is pending or threatened. While litigation can contain a
high degree of uncertainty and the risk of an unfavorable
outcome, the eventual outcome of any such matter or group of
related matters, in the opinion of management, is not expected
to have a material adverse effect on the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Like other petroleum refiners, the Company&#146;s operations are
subject to extensive and rapidly changing federal and state
environmental regulations governing air emissions, wastewater
discharges, and solid and hazardous waste management activities.
The Company&#146;s policy is to accrue environmental and
clean-up related costs of a non-capital nature when it is both
probable that a liability has been incurred and that the amount
can be reasonably estimated. While it is often extremely
difficult to reasonably quantify the liability for future
environmental expenditures, the Company anticipates that
expenditures will be required over the next several years to
comply with existing regulations. The Company has recorded a
liability of $1.2&nbsp;million and $1.4&nbsp;million as of
December&nbsp;31, 2004 and 2003, respectively, to cover the
estimated costs of compliance with environmental regulations
required at an operating refinery that are not anticipated to be
of a capital nature. The liability is not discounted.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is under various requirements of the Texas
Commission on Environmental Quality (TCEQ) as defined by certain
pleadings, orders and permits issued by that agency. As of
December&nbsp;31, 2004 and the date of the sale of the Company
(April&nbsp;29, 2005), the Company had known but inestimable
remediation efforts at the Tyler Refinery associated with an
existing groundwater and other remediation efforts.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004 and January 2005, the Company and the
U.S.&nbsp;Department of Justice (DOJ) exchanged correspondence
concerning alleged environmental violations at the Tyler
Refinery. The Company outlined several steps that it was
prepared to take to address the alleged violations and to
prevent future violations. At a meeting in January 2005, the
Company met with representatives of DOJ to discuss the
Company&#146;s proposed compliance plan. The Company expects to
negotiate a consent decree with the DOJ that will incorporate an
agreed compliance plan. Any such consent decree is expected to
include a provision requiring the Company to pay a fine and/or
penalty. Under the terms of the sale of the Tyler Refinery, the
Tyler Refinery buyer will be responsible for assuring future
compliance with any ongoing provisions of the consent decree,
while La&nbsp;Gloria will remain responsible for the payment of
any fines or penalties for environmental violations prior to the
sale. Currently, the Company cannot estimate the amount of any
potential fine or penalty that may be imposed and as such has
not accrued any liability associated with the potential fine or
penalty. La Gloria does not believe that any such fines or
penalties will be material, but can make no assurances since it
has not completed the negotiation of the consent decree.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Environment liabilities are subject to considerable
uncertainties that affect the Company&#146;s ability to estimate
its ultimate cost of remediation efforts. These uncertainties
include the exact nature and extent of the contamination at each
site, the extent of required clean-up efforts, varying costs of
alternative remediation strategies, changes in environmental
remediation requirements, the number and strength of other
potentially responsible parties at multi-party sites, and the
identification of new environmental sites.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
It is possible that the ultimate cost of future environmental
compliance, which cannot be determined at this time, could
exceed the Company&#146;s recorded liability. As a result,
charges to income for environmental liabilities could have a
material effect on the results of operations in a particular
quarter or year as assessments and remediation efforts proceed
or as new claims arise. In addition, the Company has been named
by the Environmental Protection Agency and by several state
environmental agencies as a potentially responsible party at
various federal and state Superfund sites. Management is not
aware of any environmental
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-67

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
matters that, in the ordinary course of business, would
reasonably be expected to have a material adverse effect on the
Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>7.</B></TD>
    <TD>
    <B>Noncancellable Lease Commitments</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has noncancellable operating lease commitments for
refinery equipment, office and other equipment, transportation
equipment, and office space. Lease terms range from one to four
years for refinery, office and other equipment and
month-to-month for transportation equipment. Certain of these
leases have renewal provisions.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Future minimum rental payments under noncancellable operating
lease agreements as of December 31, 2004 are as follows (in
thousands):
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 9pt; ">

<TR style="font-size: 1pt;">
    <TD width="84%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Operating</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Leases</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2008</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2009</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    After 2009</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total minimum rental payments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$114</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
Rental expense for the years ended December&nbsp;31, 2004, 2003,
and 2002 was $947,081, $930,276, and $1,005,593, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>8.</B></TD>
    <TD>
    <B>Fair Value of Financial Instruments</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company considers cash and cash equivalents, accounts
receivable, futures, forwards, swaps, and accounts payable to be
its financial instruments. The carrying amount reported in the
balance sheet for cash and cash equivalents, accounts
receivable, futures, forwards, swaps, and accounts payable
represent their fair values.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>9.</B></TD>
    <TD>
    <B>Income Taxes</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant components of the Company&#146;s deferred tax
liabilities and assets are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="70%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>December&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Thousand of dollars)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred tax liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(1,801</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(8,929</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Post-retirement and pension obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(753</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(432</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(942</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,255</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total deferred tax liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,496</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(10,616</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred tax assets:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Construction and inventory costs not currently deductible</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,933</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,199</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Environmental, litigation and other accruals</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>859</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,244</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>496</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total deferred tax assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,303</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,939</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net deferred tax asset (liability)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$5,807</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(3,677</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-68

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Deferred income taxes are included in the Combined Balance Sheet
in Current deferred tax assets and deferred income taxes.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant components of the income tax provision for the years
ended December&nbsp;31 are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="66%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="11" align="center" nowrap><B>(Thousands of dollars)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Federal</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$14,706</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$3,628</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,435</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    State franchise and income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>320</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>392</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>16,006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,948</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,827</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Federal</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(8,307</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(893</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,060</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    State franchise and income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(712</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(76</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(177</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total deferred</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(9,019</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(969</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,237</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,987</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2,979</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2,590</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A reconciliation of income taxes at the U.S.&nbsp;federal
statutory income tax rate and the Company&#146;s effective tax
rate is as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2003</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2002</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Statutory U.S.&nbsp;Federal income tax rate</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Effect of state income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3</TD>
    <TD align="left" valign="bottom" nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1</TD>
    <TD align="left" valign="bottom" nowrap>)%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2</TD>
    <TD align="left" valign="bottom" nowrap>)%</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>36</TD>
    <TD align="left" valign="bottom" nowrap>%</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>10.</B></TD>
    <TD>
    <B>Subsequent Events</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Crown&#146;s Asset
Divestment Plan</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In January 2003, Crown engaged the firm of Park Avenue Equity
Management, LLC (Park Avenue), to assist in the marketing for
sale Crown or all of its assets. A partner of Park Avenue is
also a director of Rosemore, Inc. Since January 2003, Crown has
completed several asset dispositions and has entered into
agreements to dispose of others. All of the purchasers to whom
these assets have been sold, or agreed to be sold, were
unrelated to Crown, including the March 2005 agreement to sell
the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of December&nbsp;31, 2004, Crown has sold all of its
operating retail sites and most of its product terminals. Since
Crown began its divestment process in early 2003,
339&nbsp;active and idle retail sites and nine product terminals
were sold, resulting in net proceeds of approximately
$148.2&nbsp;million, which reflects expenses related to the
asset sales and certain payments to close out related
sale-leaseback transactions. The sales of such assets are not
reflected in the accompanying Company financial statements as
these sales are unrelated to the Company&#146;s operations
presented herein.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On March&nbsp;14, 2005, La Gloria executed a Purchase and Sale
Agreement for the sale of the Company (the Tyler Refinery and
McMurrey Pipeline assets). Under the terms of the agreement, the
buyer will offer to employ most of the employees at the
facilities and will recognize the unions by whom certain of the
Company&#146;s employees at the Tyler Refinery are represented.
La Gloria completed the sale of the Company on April&nbsp;29,
2005 for $16.6&nbsp;million plus the value of the remaining
inventory.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-69

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Repayment of Outstanding Obligations under the
    10<FONT style="font-size: 70%"><SUP>7</SUP></FONT>/<FONT style="font-size: 60%">8</FONT>%
    Senior Note Indenture</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Simultaneous with the sale of the Pasadena Refinery, Crown
arranged for the full satisfaction of all of its outstanding
obligations on its
10<FONT style="font-size: 70%"><SUP>7</SUP></FONT>/<FONT style="font-size: 60%">8</FONT>%&nbsp;Senior
Notes due February&nbsp;1, 2005. Payment was made to the Trustee
under the Note Indenture and all noteholders were paid principal
and interest in full on the maturity date.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>11.</B></TD>
    <TD>
    <B>Related Party Transactions</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has related party transactions with its parent and
affiliates whose operating results are not part of the
Company&#146;s financial statements. Transactions and balances
with such affiliated entities are considered to be related party
(affiliate) transactions and balances. Such sales and related
cost of sales were approximately $135.2&nbsp;million and
$131.9&nbsp;million in 2004, $320.6&nbsp;million and
$321.6&nbsp;million in 2003, and $297.2&nbsp;million and
$269.9&nbsp;million in 2002. Amounts due to the Company related
to such sales are reflected in the &#147;net transactions with
owner&#148; in the Statement of Changes in Owner&#146;s Net
Investment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The parent provides services to the Company including corporate
senior management, human resources, legal, accounting and
information system support. Fees charged for these services are
based on allocation factors deemed appropriate by management as
described in Note&nbsp;1. Allocated administrative fees are a
component of Cost of Sales and Operating Expenses and for the
years ended December&nbsp;31, 2004, 2003, and 2002 were
$3.5&nbsp;million, $3.6&nbsp;million, and $3.8&nbsp;million,
respectively. Amounts due Crown related to these services are
reflected in the &#147;net transactions with owner&#148; in the
Statement of Changes in Owner&#146;s Net Investment.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-70

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO COMBINED FINANCIAL STATEMENTS&nbsp;&#151;
(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended December&nbsp;31, 2004</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 30pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='322'></A>
</DIV>

<!-- link1 "CONDENSED COMBINED BALANCE SHEETS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONDENSED COMBINED BALANCE SHEETS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Thousands of dollars)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="63%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>March&nbsp;31</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Unaudited)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="11" align="center" valign="top">
    <B>ASSETS</B></TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&nbsp;&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable, less allowance for doubtful accounts
    (2005&nbsp;&#151; $1,189; 2004&nbsp;&#151; $1,148)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>87,212</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>86,055</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventories, net of LIFO reserves (2005&nbsp;&#151; $34,427;
    2004&nbsp;&#151; $21,183)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,357</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,945</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid crude inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>53,279</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,883</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,489</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current deferred tax assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,584</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,361</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>153,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>185,129</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="11">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred turnaround</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,772</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,024</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property, plant and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Land</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>313</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum refineries</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,492</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>23,826</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Marketing facilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>994</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>994</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Furniture and other equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,326</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>29,125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,459</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less allowance for depreciation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,463</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,220</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net property, plant and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>18,662</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>17,239</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$178,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$203,392</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="11">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="11" align="center" valign="top">
    <B>LIABILITIES AND OWNER&#146;S NET INVESTMENT</B></TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil and refined products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$78,634</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$57,294</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>10,377</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,111</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accrued liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,524</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>14,607</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>103,535</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>77,012</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,554</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,554</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other deferred liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,174</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,174</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total owner&#146;s net investment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>64,257</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>115,652</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and owner&#146;s net investment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$178,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$203,392</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-71

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='323'></A>
</DIV>

<!-- link1 "CONDENSED COMBINED STATEMENTS OF OPERATIONS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONDENSED COMBINED STATEMENTS OF OPERATIONS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Thousands of dollars)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="75%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Three Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>March&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Unaudited)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Revenues</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sales and operating revenues</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$195,560</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$109,764</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sales to affiliated party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>71,051</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>195,560</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>180,815</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="9">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Operating costs and expenses</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Costs of sales and operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>202,129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>97,734</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of sales to affiliated party</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>69,505</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Selling and administrative expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>636</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,124</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>729</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,512</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Gain) on sales and abandonments of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(95</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>203,494</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>169,780</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating (loss)/income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(7,934</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,035</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest and other income, net</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>495</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>323</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Loss)/income before tax</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(7,439</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,358</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income tax expense</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,827</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,975</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net (loss)/income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(4,612</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$7,383</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 15pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-72

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='324'></A>
</DIV>

<!-- link1 "CONDENSED COMBINED STATEMENTS OF CASH FLOWS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONDENSED COMBINED STATEMENTS OF CASH FLOWS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Thousands of dollars)</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="76%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Three Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>March&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Unaudited)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from operating activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash from operations before changes in assets and liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(4,106</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$8,988</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net changes in assets and liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>58,789</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,773</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>54,683</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,761</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="9">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from investing activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Capital expenditures</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,668</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(394</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from sales of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>95</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred turnaround maintenance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(5,970</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other changes in deferred assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(263</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash used in investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(7,901</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(299</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="9">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Cash flows from financing activities</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net transactions with owner</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(46,782</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,462</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash (used in) provided by financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(46,782</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>13,462</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net increase in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-73

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='325'></A>
</DIV>

<!-- link1 "NOTES TO CONDENSED COMBINED FINANCIAL STATEMENTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>NOTES TO CONDENSED COMBINED FINANCIAL STATEMENTS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>1.</B></TD>
    <TD>
    <B>Basis of Presentation</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The accompanying financial statements have been prepared from
Crown Central Petroleum Corporation&#146;s (Crown) historical
accounting records and represent the combined financial
position, results of operations and cash flows reflecting
assets, liabilities, and operations of the Tyler Refinery and
McMurrey Pipeline operations (the Company). The disclosures in
the notes to the combined financial statements relate solely to
those assets and exclude all other Crown operations. As more
fully described below, the combined financial statements for all
periods presented include allocations of Crown corporate
expenses. For financial reporting purposes, the net intercompany
financing activities of the Company and Crown have been
accumulated into a single caption entitled &#147;owner&#146;s
net investment.&#148;
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The accompanying unaudited condensed combined financial
statements have been prepared in accordance with accounting
principles generally accepted in the United States for interim
financial information and accordingly, they do not include all
of the information and footnotes required by accounting
principles generally accepted in the United States for complete
financial statements. In the opinion of management, all
adjustments, consisting only of normal recurring adjustments,
considered necessary for a fair and comparable presentation have
been included. Operating results for the three months ended
March&nbsp;31, 2005 are not necessarily indicative of the
results that may be expected for the year ending
December&nbsp;31, 2005. These financial statements should be
read in conjunction with the combined financial statements and
footnotes thereto of Tyler Refinery and McMurrey Pipeline (a
business component of Crown Central Petroleum Corporation) for
the years ended December&nbsp;31, 2004, 2003, and 2002 contained
elsewhere in the Delek US
Form&nbsp;<FONT style="white-space: nowrap">S-1.
</FONT>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The financial statements of the Company are not necessarily
indicative of the financial position, results of operations and
cash flows that might have occurred had the Company not been
integrated into Crown&#146;s other operations. Also, they may
not be indicative of the actual financial position that might
have otherwise resulted, or of future results of operations or
financial position of the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following summarizes the significant accounting policies and
practices followed by the Company:
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Use of Estimates</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those
estimates.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Inventories</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s crude oil and refined products are valued at
the lower of cost
<FONT style="white-space: nowrap">(last-in,</FONT> first-out) or
market. Materials and supplies inventories are valued at cost.
Incomplete exchanges of crude oil and refined products due the
Company or owing to other companies are reflected in the
inventory accounts. Prepaid crude inventory represents advance
payments for future crude deliveries and is valued at the lower
of cost (on a <FONT style="white-space: nowrap">first-in,</FONT>
first-out basis) or market and is not considered in the
<FONT style="white-space: nowrap">last-in,</FONT> first-out
basis until the crude is physically received by the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
An actual valuation of inventory under the LIFO method can be
made only at the end of each year based on the inventory levels
and costs at that time. Accordingly, interim LIFO projections
are based on Management&#146;s estimates of expected year-end
inventory levels and current inventory values.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-74

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Other Current Assets</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Other current assets includes a $6.1&nbsp;million refundable
deposit with an insurance carrier. As discussed further in
Note&nbsp;8, subsequent to the quarter ended March&nbsp;31,
2005, La&nbsp;Gloria executed a purchase and sale agreement for
the sale of the Company (the Tyler Refinery and McMurrey
Pipeline assets) and Crown collected the refundable deposit.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Asset Retirement Obligations</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Effective January&nbsp;1, 2003, the Company adopted the
provisions of Statement of Financial Accounting Standards
No.&nbsp;143, <I>Accounting for Asset Retirement Obligations
</I>(SFAS&nbsp;No.&nbsp;143). This statement significantly
changed the method of accruing costs that an entity is legally
obligated to incur associated with the retirement of fixed
assets. Under SFAS&nbsp;No.&nbsp;143, the fair value of a
liability for an asset retirement obligation is recognized in
the period in which it is incurred if a reasonable estimate of
fair value can be made.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has legal asset retirement obligations for several
assets, including its refinery and pipeline, for which it is not
possible to estimate when the obligations will be settled.
Consequently, the retirement obligations for these assets cannot
be measured at this time.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Owner&#146;s Net Investment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Owner&#146;s net investment consists of Crown&#146;s initial
investment in the Company and subsequent changes in Crown&#146;s
net investment resulting from the use of centralized cash
management accounts. Substantially all payments from the
Company&#146;s customers are received by Crown and substantially
all expenses and fixed asset additions of the Company are paid
by Crown. In addition, Crown allocates corporate general and
administrative expenses to the Company based on an analysis of
the components of Crown&#146;s corporate general and
administrative expenses and the estimated percentage of each
component attributable to the Company. Corporate general and
administrative expense consists principally of corporate
compensation expense. Management believes that the method used
to allocate these expenses is reasonable. Allocated indirect
overhead costs consist principally of the following:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Corporate human resources</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Finance, accounting, legal and administration;</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>&#149;&nbsp;</TD>
    <TD align="left">
    Information technology management services.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
No interest expense incurred by Crown for general corporate debt
has been allocated to the Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Interest and Other Income, Net</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest and other income, net, primarily consists of
intercompany interest charged by the Company on net amounts due
to the Company from its parent, Crown. Amounts due the Company
from Crown, including interest, are classified as Owner&#146;s
Net Investment.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Recent Adoption</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In November 2004, the FASB issued Statement of Financial
Accounting Standards No.&nbsp;151, <I>Inventory Costs </I>(FASB
151). The Company is required to adopt the provisions of FASB
151, on a prospective basis, as of January&nbsp;1, 2006. FASB
151 clarifies the accounting for abnormal amounts of idle
facility expense, freight, handling costs, and wasted material.
FASB 151 requires that those items&nbsp;&#151; if
abnormal&nbsp;&#151; be recognized as
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-75

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
expenses in the period incurred. In addition, FASB 151 requires
the allocation of fixed production overheads to the costs of
conversions based upon the normal capacity of the production
facilities. The Company has not yet determined what effect FASB
151 will have on its earnings and financial position.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In March 2005, the FASB issued FASB Interpretation No.&nbsp;47,
<I>Accounting for Conditional Asset Retirement Obligations
</I>(FASB Interpretation No.&nbsp;47), which is an
interpretation of SFAS&nbsp;No.&nbsp;143. This interpretation is
effective no later than the end of fiscal years ending after
December&nbsp;15, 2005 and clarifies terminology within
FAS&nbsp;143 and requires companies to recognize a liability for
the fair value of a conditional asset retirement obligation when
incurred if the liability&#146;s fair value can be reasonably
estimated. The impact of the adoption of FASB Interpretation
No.&nbsp;47 on the Company&#146;s financial statements has not
yet been determined.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>2.</B></TD>
    <TD>
    <B>Supplementary Cash Flow Information</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net changes in assets and liabilities presented in the Unaudited
Condensed Combined Statements of Cash Flows are comprised of the
following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="71%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Three Months Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>March&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Thousands of dollars)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(1,157</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(10,712</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Decrease in inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,588</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Decrease in prepaid crude oil inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>32,229</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in other current assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,394</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(406</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in crude oil and refined products payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>21,340</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,835</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in other accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5,266</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,677</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    (Decrease)/ Increase in accrued liabilities and other deferred
    liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(83</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,324</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$58,789</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$4,773</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>3.</B></TD>
    <TD>
    <B>Inventories</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Inventories consisted of the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="69%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>March&nbsp;31</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>December&nbsp;31</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Thousands of dollars)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Crude oil</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$28,912</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$26,361</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Refined products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,257</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,240</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total inventories at FIFO (approximates current cost)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>62,169</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>51,601</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    LIFO reserve</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(34,427</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(21,183</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total crude oil and refined products</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>27,742</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,418</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Materials and supplies inventory at FIFO</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>615</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>527</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total inventory</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$28,357</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$30,945</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-76

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As a result of a deemed permanent reduction in LIFO inventory
quantities, the LIFO reserve related to crude oil and refined
products and costs and operating expenses for the three months
ended March&nbsp;31, 2005 and 2004 were reduced by approximately
$2.5&nbsp;million and $6.2&nbsp;million, respectively.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>4.</B></TD>
    <TD>
    <B>Credit Arrangements</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Crown maintains a Loan and Security Agreement, as amended
(Secured Credit Facility), which is used to provide cash
borrowings and letters of credit for general corporate and
working capital requirements which was extended until
January&nbsp;24, 2005. The Secured Credit Facility, which is
collateralized by virtually all assets, includes limitations on
additional indebtedness and cash dividends. Effective
December&nbsp;31, 2003, Crown was no longer required to comply
with financial covenants requiring the maintenance of minimum
levels of adjusted working capital, net worth and cash flow.
Crown pays a fee for unused commitments. Cash borrowings under
the Secured Credit Facility are limited to $50&nbsp;million and
bear interest based on the prime rate. There is no such
sub-limit for the issuance of letters of credit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
At March&nbsp;31, 2005, the total commitments within the Secured
Credit Facility were approximately $110&nbsp;million, with
$40&nbsp;million provided by bank participants and
$70&nbsp;million from Rosemore, a related party to the Company.
The bank commitments are subject to the availability of eligible
collateral, which totaled $53.1&nbsp;million at March&nbsp;31,
2005, after the application of reserves. The remaining
availability, which is provided by Rosemore, is not subject to
the limitation of eligible collateral. As of March&nbsp;31,
2005, the Company had cash borrowings of $25.5&nbsp;million and
$70.1&nbsp;million of outstanding letters of credit issued
pursuant to the Secured Credit Facility, with remaining unused
commitments of $14.4&nbsp;million. Cash borrowings and
outstanding letters of credit at March&nbsp;31, 2004, were
$25.2&nbsp;million and $71.6&nbsp;million, respectively. Letters
of Credit directly attributable to the Company operations were
$65.5&nbsp;million at March&nbsp;31, 2005 and $58.2&nbsp;million
at March&nbsp;31, 2004.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Secured Credit Facility was amended as of January&nbsp;25,
2005, with the bank participation adjusted to $40&nbsp;million
and Rosemore participations adjusted to $70&nbsp;million for a
total commitment of $110&nbsp;million. The total bank
commitments are collateralized with 85% of eligible accounts
receivables plus the lesser of, 60% of the value of eligible
inventories or $25&nbsp;million for a combined maximum of
$40&nbsp;million. The remaining availability, which is provided
by Rosemore, is not subject to the limitation of eligible
collateral. The maturity date of the facility is defined as the
earlier of December&nbsp;31, 2005 or the date of closing on the
sale of the Tyler Refinery. No contractual reductions of the
Rosemore participation are provided or contemplated. Fees and
expenses related to the issuances of letters of credit are
included in cost of the materials purchased.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>5.</B></TD>
    <TD>
    <B>Derivatives and Hedging Activities</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company uses futures, forwards and swaps to manage the price
risk inherent in purchasing crude oil in advance of the delivery
date, and in maintaining the value of inventories contained
within its refinery and pipeline system. The Company&#146;s risk
management policy sets forth the hedging strategies used to
manage the price risks. The strategies include fixing a future
margin between crude oil and certain finished products, and also
hedging fixed price purchase and sale commitments of crude oil
and refined products. These instruments generally allow for
settlement at the end of their term in either cash or product.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with SFAS&nbsp;No.&nbsp;133, <I>Accounting for
Derivative Instruments and Hedging Activities</I>, the Company
recognizes all derivatives as either assets or liabilities in
the balance sheet and those instruments are measured at fair
value. Certain derivatives, which are transacted pursuant to the
Company&#146;s risk management policy to manage price risk, do
not qualify or at the Company&#146;s discretion, are not
designated as hedges
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-77

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
under Statement No.&nbsp;133. These contracts are accounted for
on the <FONT style="white-space: nowrap">mark-to</FONT>-market
basis of accounting and as such changes in the fair value of the
derivatives are recorded each period in earnings.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of March&nbsp;31, 2005 and December&nbsp;31, 2004, the
Company had recorded derivatives in its other current assets and
crude oil and refined products payable from operations at the
Tyler Refinery of $1.5&nbsp;million and $2.0&nbsp;million,
respectively. For the three months ended March&nbsp;31, 2005,
the Company recorded expenses of $4.3&nbsp;million representing
the change in the fair value of the Company&#146;s derivative
financial instruments and hedging activities used to hedge
inventory costs. For the three months ended March&nbsp;31, 2004,
the Company recorded income of $0.1&nbsp;million representing
the change in the fair value of the Company&#146;s derivative
financial instruments and hedging activities used to hedge
inventory costs. These amounts were recorded in costs and
operating expenses in the Condensed Combined Statements of
Operations. As of March&nbsp;31, 2005 and December&nbsp;31,
2004, the Company had no derivative financial instruments
designated as hedges.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has fixed price firm purchase and sale commitments
for crude and related products that meet the requirements to be
designated as normal purchases or sales transactions and
therefore are not subject to the requirements of
SFAS&nbsp;No.&nbsp;133. The Company specifically designates each
firm commitment as a normal purchase or normal sale upon
execution. No unrealized gains are recognized on firm
commitments designated as normal purchases or normal sales. The
Company evaluates these contracts for
<FONT style="white-space: nowrap">lower-of</FONT>-cost-or-market
and where necessary, provides an allowance to write-down to
market.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>6.</B></TD>
    <TD>
    <B>Litigation and Contingencies</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has been named as a defendant in various matters of
litigation, some of which are for substantial amounts, and
involve alleged personal injury and property damage from
prolonged exposure to asbestos, silica, petroleum, petroleum
related products, including MTBE, and substances used at its
refinery or in the petroleum refining process. The Company is a
co-defendant with numerous other defendants in a number of these
suits. The Company is vigorously defending these actions;
however, the process of resolving these matters could take
several years. The liability if any, associated with these cases
was either accrued in accordance with generally accepted
accounting principles or was not determinable at March&nbsp;31,
2005. The Company has consulted with counsel with respect to
each such proceeding or large claim which is pending or
threatened. While litigation can contain a high degree of
uncertainty and the risk of an unfavorable outcome, the eventual
outcome of any such matter or group of related matters, in the
opinion of management, is not expected to have a material
adverse effect on the Company.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Like other petroleum refiners, the Company&#146;s operations are
subject to extensive and rapidly changing federal and state
environmental regulations governing air emissions, wastewater
discharges, and solid and hazardous waste management activities.
The Company&#146;s policy is to accrue environmental and
<FONT style="white-space: nowrap">clean-up</FONT> related costs
of a non-capital nature when it is both probable that a
liability has been incurred and that the amount can be
reasonably estimated. While it is often extremely difficult to
reasonably quantify the liability for future environmental
expenditures, the Company anticipates that expenditures will be
required over the next several years to comply with existing
regulations. The Company has recorded a liability of
$1.2&nbsp;million as of March&nbsp;31, 2005 and
December&nbsp;31, 2004, respectively, to cover the estimated
costs of compliance with environmental regulations required as
an operating refinery that are not anticipated to be of a
capital nature. The liability is not discounted.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is under various requirements of the Texas
Commission on Environmental Quality (TCEQ)&nbsp;as defined by
certain pleadings, orders and permits issued by that agency. As
of March&nbsp;31, 2005 and
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-78

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
the date of the sale of the Company (April&nbsp;29, 2005), the
Company had known but inestimable remediation efforts at the
Tyler facility associated with an existing groundwater and other
remediation efforts.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In December 2004 and January 2005, the Company and the
U.S.&nbsp;Department of Justice (DOJ)&nbsp;exchanged
correspondence concerning alleged environmental violations at
the Tyler Refinery. The Company outlined several steps that it
was prepared to take to address the alleged violations and to
prevent future violations. At a meeting in January 2005, the
Company met with representatives of DOJ to discuss the
Company&#146;s proposed compliance plan. The Company expects to
negotiate a consent decree with the DOJ that will incorporate an
agreed compliance plan. Any such consent decree is expected to
include a provision requiring the Company to pay a fine and/or
penalty. Under the terms of the sale of the Tyler Refinery, the
Refinery buyer will be responsible for assuring future
compliance with any ongoing provisions of the consent decree,
while La&nbsp;Gloria will remain responsible for the payment of
any fines or penalties for environmental violations prior to the
sale. Currently, the Company cannot estimate the amount of any
potential fine or penalty that may be imposed and as such has
not accrued any liability associated with the potential fine or
penalty. La&nbsp;Gloria does not believe that any such fines or
penalties will be material, but can make no assurances since it
has not completed the negotiation of the consent decree.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Environmental liabilities are subject to considerable
uncertainties that affect the Company&#146;s ability to estimate
its ultimate cost of remediation efforts. These uncertainties
include the exact nature and extent of the contamination at each
site, the extent of required
<FONT style="white-space: nowrap">clean-up</FONT> efforts,
varying costs of alternative remediation strategies, changes in
environmental remediation requirements, the number and strength
of other potentially responsible parties at multi-party sites,
and the identification of new environmental sites.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
It is possible that the ultimate cost of future environmental
compliance, which cannot be determined at this time, could
exceed the Company&#146;s recorded liability. As a result,
charges to income for environmental liabilities could have a
material effect on the results of operations in a particular
quarter or year as assessments and remediation efforts proceed
or as new claims arise. In addition, the Company has been named
by the Environmental Protection Agency and by several state
environmental agencies as a potentially responsible party at
various federal and state Superfund sites. Management is not
aware of any environmental matters that, in the ordinary course
of business, would reasonably be expected to have a material
adverse effect on the Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>7.</B></TD>
    <TD>
    <B>Employee Benefit Obligations</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table presents the components of the
Company&#146;s pension expense for the three months ended
March&nbsp;31, 2005 and 2004:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 3pt; ">

<TR style="font-size: 1pt;">
    <TD width="81%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Three Months</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>Ended</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>March&nbsp;31</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2005</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>2004</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>(Thousands</B></TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="7" align="center" nowrap><B>of dollars)</B></TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Service cost&nbsp;&#151; benefits earned during the year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$60</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$31</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest cost on projected benefit obligations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>473</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>464</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Expected return on plan assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(563</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(497</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Amortization of prior service cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Amortization of net actuarial loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>83</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>52</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net periodic pension cost</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$52</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$49</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-79

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>TYLER REFINERY AND MCMURREY PIPELINE</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(A Business Component of Crown Central Petroleum
Corporation)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>(Unaudited)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>March&nbsp;31, 2005</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
During the three months ended March&nbsp;31, 2005, Crown made
contributions to the benefit pension plan of $1.4&nbsp;million
on behalf of the Company. Total contributions on the
Company&#146;s behalf to the pension plan in 2005 are expected
to be approximately $8.3&nbsp;million.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>8.</B></TD>
    <TD>
    <B>Subsequent Events</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On March&nbsp;14, 2005, La&nbsp;Gloria executed a Purchase and
Sale Agreement for the sale of the Company (the Tyler Refinery
and McMurrey Pipeline assets). Under the terms of the agreement,
the buyer will offer to employ most of the employees at the
facilities and will recognize the unions by whom certain of the
Company&#146;s employees at the Refinery are represented.
La&nbsp;Gloria completed the sale of the Company on
April&nbsp;29, 2005 for $16.6&nbsp;million plus the value of the
remaining inventory.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As noted above, subsequent to the quarter ended March&nbsp;31,
2004, the Company executed a purchase and sale agreement for the
sale of the Company at an amount which indicated the property,
plant and equipment was impaired as of December&nbsp;31, 2004.
In the fourth quarter of 2004, the Company recognized an
impairment charge of approximately $15.3&nbsp;million.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>9.</B></TD>
    <TD>
    <B>Related Party Transactions</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has related party transactions with its parent and
affiliates whose operating results are not part of the
Company&#146;s financial statements. Transactions and balances
with such affiliated entities are considered to be related party
(affiliate)&nbsp;transactions and balances. Such sales and
related cost of sales were approximately $71.1&nbsp;million and
$69.5&nbsp;million for the three months ended March&nbsp;31,
2004. There were no transactions with such affiliated entities
in 2005. Amounts due to the Company related to such sales are
reflected in the &#147;Total Owner&#146;s net investment&#148;
on the Condensed Combined Balance Sheets.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The parent provides services to the Company including corporate
senior management, human resource, legal, accounting and
information system support. Allocated fees charged for these
services are based on an allocation based on factors deemed
appropriate by management as described in Note&nbsp;1. Allocated
administrative fees are a component of Selling and
administrative expenses and for the three month period ended
March&nbsp;31, 2005 and 2004 were $0.4&nbsp;million and
0.9&nbsp;million, respectively. Amounts due Crown related to
these services are reflected in the &#147;Total Owner&#146;s net
investment&#148; on the Condensed Combined Balance Sheets.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-80

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
<A name='328'></A>
</DIV>

<!-- link1 "REPORT OF INDEPENDENT AUDITORS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>REPORT OF INDEPENDENT AUDITORS</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Stockholder
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
Williamson Oil Co., Inc.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We have audited the accompanying consolidated balance sheet of
Williamson Oil Co., Inc. and Subsidiaries as of
November&nbsp;30, 2003, and the related consolidated statements
of operations, stockholder&#146;s equity, and cash flows for the
year then ended. These financial statements are the
responsibility of the Company&#146;s management. Our
responsibility is to express an opinion on these financial
statements based on our audit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
We conducted our audit in accordance with auditing standards
generally accepted in the United States. 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 audit provides a
reasonable basis for our opinion.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Williamson Oil Co., Inc. and Subsidiaries
at November&nbsp;30, 2003, and the consolidated results of their
operations and their cash flows for the year then ended in
conformity with accounting principles generally accepted in the
United States.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="38%"></TD>
    <TD width="62%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    /s/ Ernst &#38; Young LLP</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Nashville, Tennessee
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
March&nbsp;11, 2004, except for Note&nbsp;10, as to
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
which the date is April&nbsp;30, 2004
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-81
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='329'></A>
</DIV>

<!-- link1 "CONSOLIDATED BALANCE SHEET" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED BALANCE SHEET</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="78%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="6" align="center" valign="top">
    <B>ASSETS</B></TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current assets:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2,732,562</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable trade, net of allowance for doubtful
    accounts of $259,424</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,516,170</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts receivable, other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>658,254</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,802,068</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Prepaid expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>215,741</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of notes receivable&nbsp;&#151; related parties</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,568</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>11,955,363</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Property and equipment:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Land and improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>8,965,042</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Buildings</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>23,831,906</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Machinery and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,361,226</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Automotive equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>7,952,137</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Office equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,275,403</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Leasehold improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>234,006</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>72,619,720</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less accumulated depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(33,243,683</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,376,037</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other noncurrent assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>156,027</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes receivable&nbsp;&#151; related parties, net of current
    portion</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>951,427</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Debt issuance costs, less accumulated amortization of $139,125</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>446,685</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$52,885,539</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="6">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="6" align="center" valign="top">
    <B>LIABILITIES</B></TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current maturities of long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$28,097,547</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Line of credit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>472,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounts payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,068,583</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Petroleum and other products taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,819,443</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other payables and accrued expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,750,370</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>160,418</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current portion of long-term liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>401,180</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>39,769,541</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Long-term debt, less current maturities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>6,405,737</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fair value of interest rate swap</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>198,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred gain on asset disposal</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>990,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred revenues</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,577,303</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>48,940,581</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Stockholder&#146;s equity:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Common stock $10&nbsp;par value; 301&nbsp;shares authorized,
    issued and outstanding</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,010</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Retained earnings</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,941,948</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,944,958</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total liabilities and stockholder&#146;s equity</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$52,885,539</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-82

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='330'></A>
</DIV>

<!-- link1 "CONSOLIDATED STATEMENT OF OPERATIONS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED STATEMENT OF OPERATIONS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended November&nbsp;30, 2003</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="78%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>214,813,130</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cost of sales</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>179,996,723</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gross profit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34,816,407</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Operating expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,347,510</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income from operations</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,468,897</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other income (expense):</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net gain on sale of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>764,939</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Change in fair value of interest rate swap</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>464,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>105,418</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Rental income</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>404,443</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest expense</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,320,199</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total other expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,580,899</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Loss before income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(112,002</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(112,002</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-83

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='331'></A>
</DIV>

<!-- link1 "CONSOLIDATED STATEMENT OF STOCKHOLDER&#146;S EQUITY" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED STATEMENT OF STOCKHOLDER&#146;S EQUITY</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year ended November&nbsp;30, 2003</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="61%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Common</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Retained</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Stock</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Earnings</B></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Total</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Balance at November&nbsp;30, 2002</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,010</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,653,950</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>4,656,960</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Dividends paid</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(600,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(600,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(112,002</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(112,002</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Balance at November&nbsp;30, 2003</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,010</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,941,948</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,944,958</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-84

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='332'></A>
</DIV>

<!-- link1 "CONSOLIDATED STATEMENT OF CASH FLOWS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>CONSOLIDATED STATEMENT OF CASH FLOWS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>Year Ended November&nbsp;30, 2003</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="79%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Operating activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net loss</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(112,002</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Adjustments to reconcile net loss to net cash provided by
    operating activities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation and amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,545,813</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gain on sale of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(764,939</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Change in fair value of interest rate swap</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(464,500</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Changes in operating assets and liabilities:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in accounts receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(116,138</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Decrease in inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>253,878</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in other assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,237</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Increase in accounts payable and accrued expenses</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,744,207</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Decrease in income taxes payable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(24,877</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Change in deferred revenues</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(317,946</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash provided by operating activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,739,259</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Investing activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Proceeds from sale of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,734,836</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Purchase of property and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,291,303</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net repayment on notes receivable</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>244,816</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash used in investing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(1,311,651</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Financing activities:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net payments on line of credit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(55,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Borrowings on long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,011,681</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Payments on long-term debt</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(4,245,858</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Dividends paid</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(600,000</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net cash used in financing activities</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,889,177</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net decrease in cash and cash equivalents</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(461,569</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents at beginning of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,194,131</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash and cash equivalents at end of year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2,732,562</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Supplemental disclosure of cash flow information</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Cash paid during the year for:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Interest</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$2,778,610</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$24,877</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 9pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
See accompanying notes.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-85

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<A name='333'></A>
</DIV>

<!-- link1 "NOTES TO CONSOLIDATED FINANCIAL STATEMENTS" -->

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>1.</B></TD>
    <TD>
    <B>Summary of Significant Accounting Policies</B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Nature of Business</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Williamson Oil Co., Inc. and Subsidiaries (the
&#147;Company&#148;) operate a chain of retail convenience
stores selling gasoline, certain grocery items, and other
general merchandise. The Company operates 86 retail convenience
stores in the state of Alabama and one store in the state of
Tennessee.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Consolidation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The consolidated financial statements include Williamson Oil
Co., Inc., and its wholly owned subsidiaries, Liberty Wholesale
Co., Inc., Gasoline Associated Services, Inc., and Jetstream
Aviation, Inc. All significant intercompany transactions and
balances have been eliminated in the consolidated financial
statements. During the year ended November&nbsp;30, 2003,
Jetstream Aviation, Inc. was merged into the parent company,
Williamson Oil Co., Inc., which merger had no impact on the
consolidated financial statements.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Cash and Cash Equivalents</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company considers all highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents. The Company maintains accounts in financial
institutions located in Alabama and Georgia. The balances are
insured by the Federal Deposit Insurance Corporation up to
$100,000&nbsp;per financial institution. At certain times, the
Company&#146;s cash balances exceed $100,000 and are uninsured.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Inventories</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Inventories consist of gasoline, diesel fuel, other petroleum
products, cigarettes, beer, convenience merchandise and food
service merchandise. Fuel and wholesale inventories are stated
at the lower of cost or market on a
<FONT style="white-space: nowrap">first-in,</FONT> first-out
(&#147;FIFO&#148;) basis; other non-fuel inventories are stated
at estimated cost as determined by the retail inventory method.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Property and Equipment</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Acquisitions of property and equipment are carried at cost.
Betterments, renewals and extraordinary repairs that extend the
life of the asset are capitalized; other maintenance and repairs
are charged to expense as incurred. The Company owns certain
fixed assets on leased locations and depreciates these assets
and asset improvements over the lesser of management&#146;s
estimated useful lives of the asset or the remaining lease term.
Depreciation is computed using the straight-line method or
accelerated methods over management&#146;s estimated useful
lives of the related assets, which are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Land improvements</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15-20&nbsp; years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Buildings</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>20&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Machinery and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5-7&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Automotive equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Office equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>5-7&nbsp;years</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Depreciation and amortization expense for the year ended
November&nbsp;30, 2003 was $4,545,813.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In accordance with Statement of Financial Accounting Standards
(&#147;SFAS&#148;) No.&nbsp;144, &#147;Accounting for the
Impairment or Disposal of Long-Lived Assets,&#148; the Company
evaluates the realizability of property and equipment as events
occur that could indicate impairment using measurements such as
projected undiscounted operating cash flows from the respective
asset.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-86

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On February&nbsp;20, 2001 and August&nbsp;27, 1999, the Company
sold and subsequently leased back two convenience stores to
officers of the Company. Under the terms of the sale agreement,
the Company has the option to purchase the leased property with
fifteen days advance written notice of its election to the
landlord. The Company also guarantees the notes held by the
officers for these facilities. Due to the continuing involvement
in these stores, as defined by SFAS&nbsp;No.&nbsp;66,
&#147;Accounting for Sales of Real Estate&#148;, the Company
accounts for these transactions under the financing method.
Consistent with the financing method, the Company continues to
report the related notes payable and property balances of these
stores in its financial statements. One of the notes has an
interest rate of 8.25% and monthly principal payments of $11,111
through August&nbsp;26, 2004. The other note has an interest
rate of LIBOR plus 2.50% and monthly principal payments of
$9,916 through February&nbsp;15, 2011.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></TD>
    <TD>
    <B><I>Income Taxes</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income taxes are accounted for under the provisions of
SFAS&nbsp;No.&nbsp;109, &#147;Accounting for Income Taxes.&#148;
This statement generally requires the Company to record deferred
income taxes for the differences between the book and tax bases
of its assets and liabilities, which are measured using enacted
tax rates and laws that will be in effect when the differences
are expected to reverse. Deferred income tax expense or benefit
represents the net change during the year in the Company&#146;s
deferred income tax assets and liabilities.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></TD>
    <TD>
    <B><I>Revenue Recognition</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company recognizes revenue as its products are sold to
customers.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></TD>
    <TD>
    <B><I>Accounts Receivable Trade</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company reports trade receivables at estimated net
realizable value. Management determines the allowance for
doubtful accounts based on historical losses and current
economic conditions. On a continuing basis, management analyzes
delinquent receivables, and once these receivables are
determined to be uncollectible, they are written off through a
charge against an existing allowance account or against earnings.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></TD>
    <TD>
    <B><I>Vendor Discounts and Deferred Revenue</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company receives cash discounts or cash payments from
certain vendors related to product promotions based upon factors
such as quantities purchased, quantities sold, merchandise
exclusivity, store space, etc. The Company recognizes these
amounts as a reduction of cost of goods sold at the time the
discount is earned. Certain of these amounts are received from
vendors related to agreements covering several periods. These
amounts are initially recorded as deferred revenue upon receipt
and subsequently recognized as a reduction of cost of goods sold
as earned.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Fair Value of Financial Instruments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The fair values of financial instruments are estimated based
upon current market conditions and quoted market prices for the
same or similar instruments as of November&nbsp;30, 2003.
Management estimates that book value approximates fair value for
all of the Company&#146;s assets and liabilities that fall under
the scope of SFAS&nbsp;No.&nbsp;107, &#147;Disclosures about
Fair Value of Financial Instruments.&#148;
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Use of Estimates</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-87

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those
estimates.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Debt Issuance Costs</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company capitalizes certain direct costs associated with the
issuance of new debt when paid. These costs are then amortized
on the straight-line basis over the term of the related debt,
which is not significantly different from the interest method.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Comprehensive Income</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Statement of Financial Accounting Standards No.&nbsp;130,
<I>Reporting Comprehensive Income,</I> (SFAS&nbsp;130), requires
that total comprehensive income be reported in the financial
statements. Total comprehensive loss is equal to net loss for
the year ended November&nbsp;30, 2003.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Recent Accounting Pronouncements</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In November 2002, the EITF reached a consensus on
EITF&nbsp;<FONT style="white-space: nowrap">02-16,</FONT> which
addresses the accounting and income statement classification for
consideration given by a vendor to a retailer in connection with
the sale of the vendor&#146;s products or for the promotion of
sales of the vendor&#146;s products. The EITF concluded that
such consideration received from vendors should be reflected as
a decrease in prices paid for inventory and recognized in cost
of sales as the related inventory is sold, unless specific
criteria are met qualifying the consideration for treatment as
reimbursement of specific, identifiable incremental costs. As
clarified by the EITF in January 2003, this issue was effective
for arrangements with vendors initiated on or after
January&nbsp;1, 2003. The provisions of this consensus are
consistent with the Company&#146;s existing accounting policy.
Accordingly, the adoption of
EITF&nbsp;<FONT style="white-space: nowrap">02-16</FONT> did not
have a material impact on the Company&#146;s financial
statements as a whole.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In January 2003, FASB issued Interpretation No.&nbsp;46,
Consolidation of Variable Interest Entities, an Interpretation
of ARB No.&nbsp;51 (&#147;FIN&nbsp;46&#148;). FIN&nbsp;46
requires certain variable interest entities to be consolidated
by the primary beneficiary of the entity if the equity investors
in the entity do not have the characteristics of a controlling
financial interest or do not have sufficient equity interest at
risk for the entity to finance its activities without additional
subordinated financial support from other parties. FIN&nbsp;46
is effective for all new variable interest entities created or
acquired after December&nbsp;31, 2003. For variable interest
entities created or acquired prior to January&nbsp;1, 2004, the
provisions of FIN&nbsp;46 must be applied for the first interim
or annual period after December&nbsp;15, 2004. As a result,
FIN&nbsp;46 does not have an effect on the Company in the
current year. The Company has not yet determined whether
FIN&nbsp;46 will have a significant impact on its financial
statements in the future.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>2.</B></TD>
    <TD>
    <B>Inventories</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The components of inventories were as follows as of
November&nbsp;30, 2003:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="84%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Gasoline and diesel inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,316,423</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Grocery inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>4,741,429</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>744,216</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total inventories</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>6,802,068</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-88

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>3.</B></TD>
    <TD>
    <B>Notes&nbsp;Receivable&nbsp;&#151; Related Parties</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Notes receivable from related parties consisted of the following
at November&nbsp;30, 2003:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="86%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Chief executive officer</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$817,496</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other related parties (primarily employees and family of the
    chief executive officer)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>164,499</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>981,995</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Due within one year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>30,568</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Due after one year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$951,427</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Repayment terms and conditions vary depending upon the nature of
the loans.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>4.</B></TD>
    <TD>
    <B>Long-Term Debt</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Debt and obligations under capital leases at November&nbsp;30,
2003 consisted of the following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Term loan, with monthly principal payments of $170,579 through
    March&nbsp;1, 2019; interest payable monthly at 8.15%</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$17,102,196</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Term loans, with various monthly principal payments maturing
    2007-2011 with interest rates of 6.00% or 6.75%</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,645,659</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Promissory note, with monthly principal payments of $33,992
    through July&nbsp;30, 2008; interest payable monthly at 7.50%</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,295,050</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Promissory note, with variable monthly principal payments
    through July&nbsp;30, 2008; interest payable monthly at LIBOR
    plus 2.37%</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,330,625</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Notes payable of officers of the Company (see Note&nbsp;1)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,513,516</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>301,043</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,188,089</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Obligations under capital leases (see Note&nbsp;5)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,315,195</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>34,503,284</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less amounts due within one year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>28,097,547</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Amounts due after one year</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$6,405,737</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s debt is collateralized by substantially all
of the Company&#146;s real estate and equipment.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The provisions of the term loans described above require the
Company to maintain certain financial covenants including
minimum tangible stockholder&#146;s equity, maximum total
liabilities to tangible stockholder&#146;s equity, cash flow to
current maturities and a maximum amount of notes payable to the
stockholder, related parties, and others, as defined by the term
loan agreements. As of November&nbsp;30, 2003, the Company
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-89

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
was in violation of certain of these covenants. As a result, the
outstanding balances of the term loans have been classified as
current in the Company&#146;s financial statements.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Maturities of long-term debt are as follows:</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2004</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>27,493,043</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>756,894</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>776,630</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>797,883</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2008</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,989,826</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Thereafter</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>373,813</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>33,188,089</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Line of Credit</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company has a $2,000,000 revolving line of credit with
Compass Bank, which expires October&nbsp;1, 2004. The interest
rate is based on the London Interbank Offered Rate
(&#147;LIBOR&#148;) plus 3% with a minimum rate of 6.75% and a
maximum rate of 18.00%. At November&nbsp;30, 2003, the balance
on the line of credit was $472,000. The majority stockholder of
the Company has personally guaranteed this line of credit.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Derivative Instruments</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;2, 1997, the Company entered into an interest rate
swap agreement, which fixed the interest rate on $10,000,000 of
notional principal amount at 9.65% through April&nbsp;4, 2004.
This agreement was intended to economically hedge floating rate
debt relating to the various debt instruments, as discussed
above. However, as the Company elected to not comply with the
requirements, including formal hedge designation and
documentation, to apply hedge accounting treatment in accordance
with the provisions of SFAS&nbsp;No.&nbsp;133, &#147;Accounting
for Derivative Instruments and Hedging Activities,&#148; the
Company records the fair value of the derivative in the balance
sheet with the change in the fair value recorded into earnings.
See Note&nbsp;9 for discussion of related litigation.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>5.</B></TD>
    <TD>
    <B>Capital Lease Obligations</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company leases certain equipment under capital leases. The
economic substance of the leases is that the Company is
financing the acquisition of the assets through the lease and,
accordingly, they are recorded in the Company&#146;s assets and
liabilities at the lesser of the present value of the minimum
lease payments or the fair value of the assets. The assets are
amortized over their estimated useful lives through depreciation
expense. Generally, assets under capital leases are purchased at
the end of the lease term.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following is an analysis of the leased assets included in
property and equipment at November&nbsp;30, 2003:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="84%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Machinery and equipment</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>3,335,189</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less accumulated depreciation</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,232,119</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>1,103,070</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-90

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Future minimum rentals for leased property under capital leases
are as follows at November&nbsp;30, 2003:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="84%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2004</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$686,830</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>488,756</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>281,330</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>37,619</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total minimum lease payments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,494,535</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less amount representing interest</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>179,340</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,315,195</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest rates on capital lease obligations range from 9.0% to
11.5% and are imputed based on the lower of the Company&#146;s
incremental borrowing rate at the inception of each lease or the
lessor&#146;s implicit rate of return.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>6.</B></TD>
    <TD>
    <B>Operating Leases</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In conducting a part of their operations, the Company has
commitments under various operating leases for service stations
and equipment. Some of the operating leases contain renewal
options for various periods. Rental payments required during
renewal periods are not materially different. Rent charged to
operations totaled $2,250,184 for the year ended
November&nbsp;30, 2003.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Future minimum rental payments required under operating leases
that have initial or remaining noncancelable lease terms in
excess of one year are as follows for the next five fiscal years
ending November&nbsp;30:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="82%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2004</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$1,521,570</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2005</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,446,741</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2006</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,368,366</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2007</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,309,491</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    2008</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>1,056,268</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Thereafter</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>3,606,688</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total minimum lease payments</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$10,309,124</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-91

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>7.</B></TD>
    <TD>
    <B>Income Taxes</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Income taxes for the year ended November&nbsp;30, 2003 are
comprised of the following components:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="83%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Current</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Federal</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    State</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred Benefit (Provision)</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Federal</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>22,672</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    State</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,886</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Change in valuation allowance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(25,558</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="2"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts
used for income tax purposes. Significant components of the
Company&#146;s deferred tax assets and liabilities as of
November&nbsp;30, 2003 are as follows:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="76%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Current Deferred Taxes:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Allowance for doubtful accounts</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$26,350</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Vacation accrual</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>35,805</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>33,560</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less valuation allowance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(95,715</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total current deferred tax assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD colspan="3" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    <B>Noncurrent Deferred Taxes:</B></DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Depreciation/amortization</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(2,653,936</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Net operating loss carry forwards</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>2,058,849</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred gain on sale of assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>341,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Fair value of interest rate swap</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>61,380</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Deferred revenue</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>579,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>15,008</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Less valuation allowance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(401,531</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total noncurrent deferred tax assets</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD colspan="3"><FONT style="font-size: 10pt">&nbsp;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Realization of future tax benefits related to deferred tax
assets is dependent on many factors, including the
Company&#146;s ability to generate taxable income within the net
operating loss carryforward period. Management has considered
these factors in assessing the valuation allowance for financial
reporting purposes. In accordance with SFAS&nbsp;109, the
Company has provided a valuation allowance to reserve the
deferred tax assets.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-92

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>WILLIAMSON OIL CO., INC. AND SUBSIDIARIES</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS&nbsp;&#151;&nbsp;(Continued)</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">
<B>November&nbsp;30, 2003</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
As of November&nbsp;30, 2003, the Company had consolidated
federal net operating loss carryfowards of $6,240,449 and state
net operating loss carryforwards of $9,454,496 available to
offset future taxable income. These carryfowards, if unused,
will expire in fiscal years ranging from 2013 to 2022.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The difference between the actual income tax benefit and the tax
benefit computed by applying the statutory federal income tax
rate to loss before income taxes is attributable to the
following:
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="85%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Benefit for federal income taxes at statutory rate</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$(30,801</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    State income taxes, net of federal tax benefit</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>(3,920</TD>
    <TD align="left" valign="bottom" nowrap>)</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Change in valuation allowance</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>25,558</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Other permanent items</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>9,163</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Benefit for income taxes</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD align="right" valign="bottom" nowrap>$&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 3pt double #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

</TABLE>
</CENTER>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>8.</B></TD>
    <TD>
    <B>Sale of Trucks</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On September&nbsp;10, 2003, the Company completed the sale of
its entire fleet of trucks and gasoline tankers to Hi-Ridge
Transport, Inc (&#147;Hi-Ridge&#148;) for $2.3&nbsp;million.
Upon completion of the sale, the Company entered into a service
contract with Hi-Ridge for the delivery of its fuel as discussed
in Note&nbsp;9. The excess of the sales price over the estimated
fair value of the assets sold ($1,100,000) was recorded as a
deferred gain and will be recognized as income over the life of
the service contract.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="4%"></TD>
    <TD width="96%"></TD>
</TR>

<TR valign="top">
    <TD><B>9.</B></TD>
    <TD>
    <B>Commitments and Contingencies</B></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Litigation</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company is involved in disputes with respect to certain
interest rate agreements between the Company and a bank. The
Company has filed suits against the bank seeking judgment to
limit the Company&#146;s liability under the interest rate
agreements and requesting recovery of certain damages. The bank
claims that the Company owes the bank $1,055,000 plus interest
and legal costs. Management believes this matter will be
resolved with no material adverse impact to the Company&#146;s
results of operations, cash flows or financial position;
however, the ultimate outcome of this matter is currently
unknown. In addition to the above legal matter, the Company is
party to certain lawsuits arising in the normal course of
business. In the opinion of management, the amount of any
liability arising from these lawsuits will not be material to
the financial position or results of operations of the Company.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD></TD>
    <TD>
    <B><I>Service Contract</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In conjunction with the sale of its fleet of trucks and gasoline
tankers as described in Note&nbsp;8, the Company entered into a
ten-year noncancellable contract with Hi-Ridge for the delivery
of fuel to the Company&#146;s convenience stores as well as its
other fuel customers. The long-term service contract sets
delivery rates for Hi-Ridge over the next five years at stated
amounts, with the rate for the last five years to be negotiated.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>

<TR valign="top">
    <TD><B>10.</B></TD>
    <TD>
    <B>Subsequent Events</B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On April&nbsp;30, 2004, the sole shareholder of the Company sold
all outstanding shares of stock in the Company to MAPCO Family
Centers, Inc. In connection with this transaction, all
outstanding debt of the Company was refinanced under terms
negotiated by the buyer.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">F-93

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 27pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<IMG src="g99350g9935004.gif" alt="(GRAPH)">
</DIV>

<DIV align="center" style="font-size: 14pt;color: #000000; background: #ffffff; margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares</B>
</DIV>

<DIV align="center" style="font-size: 18pt;color: #000000; background: #ffffff; margin-top: 72pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B><FONT style="font-variant:SMALL-CAPS">Delek US Holdings,
Inc.</FONT></B>
</DIV>

<DIV align="center" style="font-size: 18pt;color: #000000; background: #ffffff; margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
Common Stock
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 37pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 33%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
PROSPECTUS
</DIV>

<DIV align="center" style="font-size: 12pt;color: #000000; background: #ffffff;">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
2006
</DIV>

<DIV align="center" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 33%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV align="center" style="font-size: 16pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B><FONT style="font-variant:SMALL-CAPS">Lehman
Brothers</FONT></B>
</DIV>

<DIV align="center" style="font-size: 16pt;color: #000000; background: #ffffff;">
<B><FONT style="font-variant:SMALL-CAPS">Citigroup</FONT></B>
</DIV>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>PART&nbsp;II</B>
</DIV>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>INFORMATION NOT REQUIRED IN PROSPECTUS</B>
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD><B>Item&nbsp;13.</B></TD>
    <TD>
    <B><I>Other Expenses of Issuance and Distribution.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table sets forth the various expenses, other than
underwriting discounts and commissions, payable by the
registrant in connection with the sale of common stock being
registered. All of the amounts shown are estimated except the
Securities and Exchange Commission registration fee, the
National Association of Securities Dealers, Inc.
(&#147;NASD&#148;) filing fee and the NYSE listing fee.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="75%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap><B>Amount to Be Paid</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    SEC registration fee</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>24,610</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    NASD filing fee</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>23,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    NYSE listing fee*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Printing and engraving expenses*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Legal fees and expenses*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Accounting fees and expenses*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Blue sky fees and expenses*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Transfer agent and registrar fees*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" bgcolor="#cceeff">
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Miscellaneous fees and expenses*</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>

</TR>

<TR>
    <TD align="left" valign="top">
    <DIV style="margin-left: 10px; text-indent: -10px">
    Total</DIV>
    </TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">$</TD>
    <TD align="right" valign="bottom" nowrap>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="2%"></TD>
    <TD width="98%"></TD>
</TR>

<TR valign="top">
    <TD>*&nbsp;</TD>
    <TD align="left">
    To be completed by amendment.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD><B>Item&nbsp;14.</B></TD>
    <TD>
    <B><I>Indemnification of Directors and Officers.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;145(a) of the Delaware General Corporation Law (the
&#147;DGCL&#148;) provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the
corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation or enterprise,
against expenses (including attorneys&#146; fees), judgments,
fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with such action, suit or
proceeding if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe the
person&#146;s conduct was unlawful.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;145(b) provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that such person
acted in any of the capacities set forth above, against expenses
(including attorneys&#146; fees) actually and reasonably
incurred by the person in connection with the defense or
settlement of such action or suit if the person acted under
standards similar to those discussed above, except that no
indemnification may be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the
court in which such action or suit was brought shall determine
that despite the adjudication of liability, such person is
fairly and reasonably entitled to be indemnified for such
expenses which the court shall deem proper.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;145 further provides that to the extent a director
or officer of a corporation has been successful in the defense
of any action, suit or proceeding referred to in subsections
(a)&nbsp;and (b)&nbsp;or in the defense of any claim, issue or
matter therein, such person shall be indemnified against
expenses (including attorneys&#146; fees) actually and
reasonably incurred by such person in connection therewith; that
indemnification provided for by
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">II-1

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff;">
Section&nbsp;145 shall not be deemed exclusive of any other
rights to which the indemnified party may be entitled; and that
the corporation may purchase and maintain insurance on behalf of
a director or officer of the corporation against any liability
asserted against such person or incurred by such person in any
such capacity or arising out of such person&#146;s status as
such whether or not the corporation would have the power to
indemnify such person against such liabilities under
Section&nbsp;145.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The registrant&#146;s amended and restated bylaws provide that
the registrant shall indemnify any director or officer of the
corporation, and may indemnify any other person, who
(a)&nbsp;was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the
corporation) by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses
(including attorneys&#146; fees), judgments, fines, and amounts
paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in
good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful, and (b)&nbsp;was or
is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses (including
attorneys&#146; fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit
if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation
and except that no indemnification shall be made in respect of
any claim, issue or matter as to which such person shall have
been adjudged to be liable to the corporation unless and only to
the extent that the Delaware Court of Chancery or the court in
which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which the
Delaware Court of Chancery or such other court shall deem proper.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section&nbsp;102(b)(7) of the DGCL provides that a certificate
of incorporation may contain a provision eliminating or limiting
the personal liability of a director to the corporation or its
stockholders for monetary damages for breach of fiduciary duty
as a director, provided that such provision shall not eliminate
or limit the liability of a director: (i)&nbsp;for any breach of
the director&#146;s duty of loyalty to the corporation or its
stockholders; (ii)&nbsp;for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation
of law; (iii)&nbsp;under Section&nbsp;174 of the DGCL; or
(iv)&nbsp;for any transaction from which the director derived an
improper personal benefit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The registrant&#146;s amended and restated certificate of
incorporation provides that, to the fullest extent permitted by
the DGCL, as the same exists or hereafter may be amended, a
director of the corporation shall not be personally liable to
the corporation or its stockholders for monetary damages for the
breach of any fiduciary duty as a director, except for liability
(i)&nbsp;for any breach of the director&#146;s duty of loyalty
to the corporation or its stockholders, (ii)&nbsp;for acts or
omissions not in good faith or that involve intentional
misconduct or a knowing violation of law, (iii)&nbsp;under
Section&nbsp;174 of the DGCL, as the same exists or hereafter
may be amended, or (iv)&nbsp;for any transaction from which the
director derived an improper personal benefit.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
In addition, the registrant has entered into indemnification
agreements, in the forms attached as Exhibits&nbsp;10.3 and 10.4
hereto, with its directors and executive officers which would
require the registrant, among other things, to indemnify them
against certain liabilities which may arise by reason of their
status.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The registrant maintains directors&#146; and officers&#146;
liability insurance for its officers and directors.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The underwriting agreement filed as Exhibit&nbsp;1.1 to this
Registration Statement contains provisions indemnifying officers
and directors of the registrant against liabilities arising
under the Securities Act of 1933, as amended, or Securities Act,
or otherwise.
</DIV>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">II-2

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD><B>Item&nbsp;15.</B></TD>
    <TD>
    <B><I>Recent Sales of Unregistered Securities.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Set forth below is information regarding securities issued by
the registrant in the last three years in transactions that were
not registered under the Securities Act including the
consideration, if any, received by the registrant for such
issuances.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
On May&nbsp;1, 2004, the registrant granted share purchase
rights to Ezra Uzi Yemin, the President and Chief Executive
Officer, that permit Mr.&nbsp;Yemin to purchase, subject to
vesting requirements, up
to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares
of the registrant&#146;s common stock, pursuant to the terms of
his employment agreement.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The share purchase rights and the shares of common stock
issuable upon the exercise thereof were issued in reliance on
the exemption from registration provided by Section&nbsp;4(2) of
the Securities Act and Rule&nbsp;701 promulgated thereunder. No
underwriters were involved in connection with any of the sales
of securities referred to in this Item&nbsp;15.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD><B>Item&nbsp;16.</B></TD>
    <TD>
    <B><I>Exhibits and Financial Statement Schedules.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(a)<I>&nbsp;Exhibits.</I>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>No.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Description</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>1</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Underwriting Agreement.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>3</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Certificate of Incorporation.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>3</TD>
    <TD align="left" valign="top" nowrap>.2*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Bylaws.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>4</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Specimen common stock certificate.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>5</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Opinion of Fulbright&nbsp;&#38; Jaworski L.L.P.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Employment Agreement, dated as of May&nbsp;1, 2004, by and
    between MAPCO Express, Inc., Uzi Yemin and Delek US Holdings,
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.1(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment No. 1 to Employment Agreement, dated as of
    October&nbsp;31, 2005 and effective as of September&nbsp;15,
    2005, by and among MAPCO Express, Inc., Delek US Holdings, Inc.
    and Uzi Yemin.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.1(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment No. 2 to Employment Agreement, dated as of
    February&nbsp;1, 2006, by and among MAPCO Express, Inc., Delek
    US Holdings, Inc. and Uzi Yemin.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.2</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consulting Agreement, dated as of May&nbsp;1, 2005, by and
    between Greenfeld-Energy Consulting, Ltd. and Delek Refining,
    Ltd.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.3*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Director Indemnification Agreement.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.4*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Officer Indemnification Agreement.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.5+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Distribution Service Agreement, dated as of January&nbsp;1,
    2005, by and between MAPCO Express, Inc. and McLane Company,
    Inc. DBA McLane Grocery Distribution.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.6+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    RPC Agreement, dated as of May&nbsp;30, 2001, by and between
    Williams Refining&nbsp;&#38; Marketing, LLC and MAPCO Express,
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.6(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Assignment and Assumption Agreement effective as of
    March&nbsp;3, 2003, by and between Williams Refining &#38;
    Marketing, L.L.C., Williams Generating Memphis, L.L.C., Williams
    Memphis Terminal, Inc., and Williams Petroleum Pipeline Systems,
    Inc. and The Premcor Refining Group Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.6(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Assignment of the RPC Agreement between Williams Refining &#38;
    Marketing, LLC and MAPCO Express, Inc., dated May&nbsp;30, 2001,
    from The Premcor Refining Group, Inc. to Valero Marketing and
    Supply Company, effective December&nbsp;1, 2005.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Credit Agreement, dated as of
    April&nbsp;28, 2005, among MAPCO Express, Inc., MAPCO Family
    Centers, Inc., the several lenders from time to time party to
    the Agreement, Lehman Brothers Inc., SunTrust Bank, Bank Leumi
    USA and Lehman Commercial Paper Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    First Amendment to Amended and Restated Credit Agreement, dated
    as of August&nbsp;18, 2005, among MAPCO Express, Inc., MAPCO
    Family Centers, Inc., the several banks and other financial
    institutions or entities from time to time parties thereto,
    Lehman Brothers Inc., SunTrust Bank, Bank Leumi USA and Lehman
    Commercial Paper Inc.</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">II-3

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>No.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Description</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Second Amendment to Amended and Restated Credit Agreement, dated
    as of October&nbsp;11, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Agreement, Lehman Brothers Inc.,
    SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7(c)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Third Amendment to Amended and Restated Credit Agreement, dated
    as of December&nbsp;15, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Credit Agreement, Lehman Brothers
    Inc., SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.8</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Revolving Credit Agreement, dated as of
    May&nbsp;2, 2005, among Delek Refining, Ltd., Delek Pipeline
    Texas, Inc., the several banks and other financial institutions
    and lenders from time to time party thereto, SunTrust Bank, The
    CIT Group/ Business Credit, Inc., National City Business Credit,
    Inc., Bank of America, N.A. and PNC Business Credit, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.8(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    First Amendment to Amended and Restated Credit Agreement, dated
    as of October&nbsp;1, 2005, among Delek Refining, Ltd., Delek
    Pipeline Texas, Inc., various financial institutions, SunTrust
    Bank and The CIT Group/ Business Credit, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.9</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Stock Purchase Agreement, dated as of March&nbsp;29, 2004, by
    and among Delek US Holdings, Inc., MAPCO Family Centers, Inc.
    (n/k/a MAPCO Express, Inc.) and John R. Williamson.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Refinery Purchase and Sale Agreement, dated as of March&nbsp;14,
    2005, by and between La&nbsp;Gloria Oil and Gas Company, Delek
    Refining, Ltd., Delek Pipeline Texas, Inc. and Delek Texas Land,
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.10(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment to Refinery Purchase and Sale Agreement, dated as of
    April&nbsp;29, 2005, by and between La&nbsp;Gloria Oil and Gas
    Company, Delek Refining, Ltd., Delek Pipeline Texas, Inc. and
    Delek Texas Land, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.10(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Second Amendment to Refinery Purchase and Sale Agreement and
    Indemnity Agreement, dated October&nbsp;10, 2005, by and between
    La&nbsp;Gloria Oil and Gas Company (renamed Tyler Holding
    Company, Inc.), Delek Refining, Ltd., Delek Pipeline Texas, Inc.
    and Delek Texas Land, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Pipeline Capacity Lease Agreement, dated April&nbsp;12, 1999,
    between La&nbsp;Gloria Oil and Gas Company and Scurlock Permian
    LLC.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(a)+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    One-Year Renewal of Pipeline Capacity Lease Agreement, dated
    December&nbsp;21, 2004, between Plains Marketing, L.P., as
    successor to Scurlock Permian LLC, and La&nbsp;Gloria Oil and
    Gas Company.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(b)+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Assignment of the Pipeline Capacity Lease Agreement, as amended
    and renewed on December&nbsp;21, 2004, by La&nbsp;Gloria Oil and
    Gas Company to Delek Refining, Ltd.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(c)+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment to One-Year Renewal of Pipeline Capacity Lease
    Agreement, dated January&nbsp;15, 2006, between Delek Refining,
    Ltd. and Plains Marketing, L.P.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(d)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Extension of Pipeline Capacity Lease Agreement, dated
    January&nbsp;15, 2006, between Delek Refining, Ltd. and Plains
    Marketing, L.P.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.12+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Branded Jobber Contract, dated December&nbsp;15, 2005, between
    BP Products North America, Inc. and MAPCO Express, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.13*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Delek US Holdings, Inc. 2006 Long-Term Incentive Plan.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.14*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Summary of Director Compensation for Non-Employees and for
    Non-Affiliates of Delek Group Ltd.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.15</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Management and Consulting Agreement, dated as of January&nbsp;1,
    2006, by and between Delek Group Ltd. and Delek
    US&nbsp;Holdings, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>16</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Letter from Ernst&nbsp;&#38; Young LLP re Change in Certifying
    Accountant.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>16</TD>
    <TD align="left" valign="top" nowrap>.2</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Letter from Mayer Hoffman McCann P.C. re Change in Certifying
    Accountant.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>21</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Subsidiaries of the Registrant.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Fulbright&nbsp;&#38; Jaworski L.L.P. (included in
    Exhibit&nbsp;5.1).</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.2</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Ernst&nbsp;&#38; Young LLP.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.3</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Ernst&nbsp;&#38; Young LLP.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.4</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Ernst&nbsp;&#38; Young LLP.</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">II-4

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>No.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Description</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.5</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Mayer Hoffman McCann P.C.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>24</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Power of Attorney (on signature page).</TD>
</TR>

</TABLE>
</CENTER>

<DIV align="left" style="font-size: 3pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<DIV style="width: 18%; border-top: 1.0pt solid black; font-size: 1pt">&nbsp;</DIV>
</DIV>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="2%"></TD>
    <TD width="98%"></TD>
</TR>

<TR valign="top">
    <TD>*&nbsp;</TD>
    <TD align="left">
    To be filed by amendment.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="2%"></TD>
    <TD width="98%"></TD>
</TR>

<TR valign="top">
    <TD>+&nbsp;</TD>
    <TD align="left">
    Confidential treatment has been requested with respect to
    certain portions of this exhibit pursuant to Rule&nbsp;406 of
    the Securities Act. Omitted portions have been filed separately
    with the Securities and Exchange Commission.</TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
(b)&nbsp;Financial statement schedules.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All financial statement schedules are omitted because they are
inapplicable, not required or the information is indicated
elsewhere in the consolidated financial statements or the notes
thereto.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top">
    <TD><B>Item&nbsp;17.</B></TD>
    <TD>
    <B><I>Undertakings.</I></B></TD>
</TR>

</TABLE>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A.&nbsp;Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to directors, officers, and
controlling persons of the registrant pursuant to the provisions
described above in Item&nbsp;14, or otherwise, the registrant
has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted against
the registrant by such director, officer or controlling person
in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final
adjudication of such issue.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
B.&nbsp;The undersigned registrant hereby undertakes to provide
to the underwriter at the closing specified in the underwriting
agreement, certificates in such denominations and registered in
such names as required by the underwriter to permit prompt
delivery to each purchaser.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
C.&nbsp;The undersigned registrant hereby undertakes that:
</DIV>

<DIV style="margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    1.&nbsp;For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this Registration Statement in
    reliance upon Rule&nbsp;430A and contained in a form of
    prospectus filed by the registrant pursuant to
    Rule&nbsp;424(b)(1) or (4)&nbsp;or 497(h) under the Securities
    Act shall be deemed to be part of this registration statement as
    of the time it was declared effective.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    2.&nbsp;For the purpose of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus shall be deemed to be a new registration
    statement relating to the securities offered therein, and the
    offering of such securities at that time shall be deemed to be
    the initial bona fide offering thereof.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">II-5

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>SIGNATURES</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to the requirements of the Securities Act of 1933, as
amended, the registrant has duly caused this registration
statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Franklin, State of
Tennessee, on February&nbsp;8, 2006.
</DIV>

<DIV style="margin-top: 12pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="40%"></TD>
    <TD width="60%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    DELEK US HOLDINGS, INC.</TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    (Registrant)</TD>
</TR>

</TABLE>

<DIV style="margin-top: 24pt; margin-left: 0; margin-right: 0; margin-bottom: 0; color: #000000; background: #ffffff;"></DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="40%"></TD>
    <TD width="2%"></TD>
    <TD width="58%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD>By:&nbsp;</TD>
    <TD align="left">
    /s/ <FONT style="font-variant:SMALL-CAPS">Ezra Uzi Yemin
    </FONT></TD>
</TR>

</TABLE>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 3pt;color: #000000; background: #ffffff;">

<TR>
    <TD width="40%"></TD>
    <TD width="60%"></TD>
</TR>

<TR valign="top">
    <TD>&nbsp;</TD>
    <TD align="left">
    <DIV style="border-top: 1pt solid black; font-size: 1pt; margin-top: 2pt" align="left">&nbsp;</DIV></TD>
</TR>

<TR valign="top"  style="font-size: 10pt;color: #000000; background: #ffffff;">
    <TD>&nbsp;</TD>
    <TD align="left">
    Name:&nbsp;&nbsp;Ezra Uzi Yemin</TD>
</TR>

<TR valign="top"  style="font-size: 10pt;color: #000000; background: #ffffff;">
    <TD>&nbsp;</TD>
    <TD align="left">
    Title:&nbsp;&nbsp;&nbsp;President and Chief Executive Officer</TD>
</TR>

</TABLE>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>POWER OF ATTORNEY</B>
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each person whose signature appears below appoints Ezra Uzi
Yemin and Edward Morgan, and each of them, any of whom may act
without the joinder of the other, as his true and lawful
<FONT style="white-space: nowrap">attorney-in</FONT>-fact and
agent, with full power of substitution and resubstitution, for
him and in his name, place and stead, in any and all capacities,
to sign any and all amendments (including post-effective
amendments) to this Registration Statement and any Registration
Statement (including any amendment thereto) for this offering
that is to be effective upon filing pursuant to Rule&nbsp;462(b)
under the Securities Act of 1933, as amended, and to file the
same, with all exhibits thereto, and all other documents in
connection therewith, with the Securities and Exchange
Commission, granting unto said
<FONT style="white-space: nowrap">attorneys-in</FONT>-fact and
agents full power and authority to do and perform each and every
act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or would do in person,
hereby ratifying and confirming all that said
<FONT style="white-space: nowrap">attorneys-in</FONT>-fact and
agents or any of them of their or his substitute and
substitutes, may lawfully do or cause to be done by virtue
hereof.
</DIV>

<DIV align="left" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 6pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Pursuant to the requirements of the Securities Act of 1933, as
amended, this registration statement has been signed by the
following persons in the capacities and on the dates indicated.
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 6pt; ">

<TR style="font-size: 1pt;">
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="39%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="34%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
</TR>


<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>Signature</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Title</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Date</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="center" valign="top">
    /s/ <FONT style="font-variant:SMALL-CAPS">Ezra Uzi Yemin<BR>
    <HR size="1" noshade></FONT>Ezra Uzi Yemin</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    President and Chief Executive Officer (Principal Executive
    Officer) and Director</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    February&nbsp;8, 2006</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="center" valign="top">
    /s/ <FONT style="font-variant:SMALL-CAPS">Edward Morgan<BR>
    <HR size="1" noshade></FONT>Edward Morgan</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    Vice President and Treasurer (Principal Financial and Accounting
    Officer)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    February&nbsp;8, 2006</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="center" valign="top">
    /s/ <FONT style="font-variant:SMALL-CAPS">Gabriel Last<BR>
    <HR size="1" noshade></FONT>Gabriel Last</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    Director</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    February&nbsp;8, 2006</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="center" valign="top">
    /s/ <FONT style="font-variant:SMALL-CAPS">Asaf Bartfeld<BR>
    <HR size="1" noshade></FONT>Asaf Bartfeld</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    Director</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    February&nbsp;8, 2006</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="center" valign="top">
    /s/ <FONT style="font-variant:SMALL-CAPS">Ronel Ben-Dov<BR>
    <HR size="1" noshade></FONT>Ronel Ben-Dov</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    Director</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    February&nbsp;8, 2006</TD>
</TR>

<TR>
    <TD colspan="7">&nbsp;</TD>
</TR>

<TR>
    <TD colspan="3" align="center" valign="top">
    /s/ <FONT style="font-variant:SMALL-CAPS">Zvi Greenfeld<BR>
    <HR size="1" noshade></FONT>Zvi Greenfeld</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    Director</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">
    February&nbsp;8, 2006</TD>
</TR>

</TABLE>
</CENTER>

<P align="center" style="font-size: 10pt;color: #000000; background: #ffffff;">II-6

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV align="center" style="font-size: 10pt;color: #000000; background: #ffffff; margin-top: 18pt; margin-left: 0; margin-right: 0; margin-bottom: 0; ">
<B>EXHIBIT INDEX</B>
</DIV>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; margin-top: 12pt; ">

<TR style="font-size: 1pt;">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>No.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Description</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>1</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Underwriting Agreement.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>3</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Certificate of Incorporation.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>3</TD>
    <TD align="left" valign="top" nowrap>.2*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Bylaws.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>4</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Specimen common stock certificate.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>5</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Opinion of Fulbright&nbsp;&#38; Jaworski L.L.P.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Employment Agreement, dated as of May&nbsp;1, 2004, by and
    between MAPCO Express, Inc., Uzi Yemin and Delek US Holdings,
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.1(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment No. 1 to Employment Agreement, dated as of
    October&nbsp;31, 2005 and effective as of September&nbsp;15,
    2005, by and among MAPCO Express, Inc., Delek US Holdings, Inc.
    and Uzi Yemin.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.1(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment No. 2 to Employment Agreement, dated as of
    February&nbsp;1, 2006, by and among MAPCO Express, Inc., Delek
    US Holdings, Inc. and Uzi Yemin.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.2</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consulting Agreement, dated as of May&nbsp;1, 2005, by and
    between Greenfeld-Energy Consulting, Ltd. and Delek Refining,
    Ltd.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.3*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Director Indemnification Agreement.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.4*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Officer Indemnification Agreement.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.5+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Distribution Service Agreement, dated as of January&nbsp;1,
    2005, by and between MAPCO Express, Inc. and McLane Company,
    Inc. DBA McLane Grocery Distribution.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.6+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    RPC Agreement, dated as of May&nbsp;30, 2001, by and between
    Williams Refining&nbsp;&#38; Marketing, LLC and MAPCO Express,
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.6(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Assignment and Assumption Agreement effective as of
    March&nbsp;3, 2003, by and between Williams Refining &#38;
    Marketing, L.L.C., Williams Generating Memphis, L.L.C., Williams
    Memphis Terminal, Inc., and Williams Petroleum Pipeline Systems,
    Inc. and The Premcor Refining Group Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.6(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Assignment of the RPC Agreement between Williams Refining &#38;
    Marketing, LLC and MAPCO Express, Inc., dated May&nbsp;30, 2001,
    from The Premcor Refining Group, Inc. to Valero Marketing and
    Supply Company, effective December&nbsp;1, 2005.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Credit Agreement, dated as of
    April&nbsp;28, 2005, among MAPCO Express, Inc., MAPCO Family
    Centers, Inc., the several lenders from time to time party to
    the Agreement, Lehman Brothers Inc., SunTrust Bank, Bank Leumi
    USA and Lehman Commercial Paper Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    First Amendment to Amended and Restated Credit Agreement, dated
    as of August&nbsp;18, 2005, among MAPCO Express, Inc., MAPCO
    Family Centers, Inc., the several banks and other financial
    institutions or entities from time to time parties thereto,
    Lehman Brothers Inc., SunTrust Bank, Bank Leumi USA and Lehman
    Commercial Paper Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Second Amendment to Amended and Restated Credit Agreement, dated
    as of October&nbsp;11, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Agreement, Lehman Brothers Inc.,
    SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.7(c)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Third Amendment to Amended and Restated Credit Agreement, dated
    as of December&nbsp;15, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Credit Agreement, Lehman Brothers
    Inc., SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.8</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amended and Restated Revolving Credit Agreement, dated as of
    May&nbsp;2, 2005, among Delek Refining, Ltd., Delek Pipeline
    Texas, Inc., the several banks and other financial institutions
    and lenders from time to time party thereto, SunTrust Bank, The
    CIT Group/ Business Credit, Inc., National City Business Credit,
    Inc., Bank of America, N.A. and PNC Business Credit, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.8(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    First Amendment to Amended and Restated Credit Agreement, dated
    as of October&nbsp;1, 2005, among Delek Refining, Ltd., Delek
    Pipeline Texas, Inc., various financial institutions, SunTrust
    Bank and The CIT Group/ Business Credit, Inc.</TD>
</TR>

</TABLE>
</CENTER>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0" style="font-size: 10pt; ">

<TR style="font-size: 1pt;">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="80%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>Exhibit</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 8pt;">
    <TD colspan="3" align="center" nowrap><B>No.</B></TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap><B>Description</B></TD>
</TR>

<TR valign="bottom" style="font-size: 1px">
    <TD colspan="3" align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" nowrap style="border-top: 1pt solid #000000;">&nbsp;</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.9</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Stock Purchase Agreement, dated as of March&nbsp;29, 2004, by
    and among Delek US Holdings, Inc., MAPCO Family Centers, Inc.
    (n/k/a MAPCO Express, Inc.) and John R. Williamson.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Refinery Purchase and Sale Agreement, dated as of March&nbsp;14,
    2005, by and between La&nbsp;Gloria Oil and Gas Company, Delek
    Refining, Ltd., Delek Pipeline Texas, Inc. and Delek Texas Land,
    Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.10(a)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment to Refinery Purchase and Sale Agreement, dated as of
    April&nbsp;29, 2005, by and between La&nbsp;Gloria Oil and Gas
    Company, Delek Refining, Ltd., Delek Pipeline Texas, Inc. and
    Delek Texas Land, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.10(b)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Second Amendment to Refinery Purchase and Sale Agreement and
    Indemnity Agreement, dated October&nbsp;10, 2005, by and between
    La&nbsp;Gloria Oil and Gas Company (renamed Tyler Holding
    Company, Inc.), Delek Refining, Ltd., Delek Pipeline Texas, Inc.
    and Delek Texas Land, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Pipeline Capacity Lease Agreement, dated April&nbsp;12, 1999,
    between La&nbsp;Gloria Oil and Gas Company and Scurlock Permian
    LLC.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(a)+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    One-Year Renewal of Pipeline Capacity Lease Agreement, dated
    December&nbsp;21, 2004, between Plains Marketing, L.P., as
    successor to Scurlock Permian LLC, and La&nbsp;Gloria Oil and
    Gas Company.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(b)+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Assignment of the Pipeline Capacity Lease Agreement, as amended
    and renewed on December&nbsp;21, 2004, by La&nbsp;Gloria Oil and
    Gas Company to Delek Refining, Ltd.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(c)+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Amendment to One-Year Renewal of Pipeline Capacity Lease
    Agreement, dated January&nbsp;15, 2006, between Delek Refining,
    Ltd. and Plains Marketing, L.P.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.11(d)</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Extension of Pipeline Capacity Lease Agreement, dated
    January&nbsp;15, 2006, between Delek Refining, Ltd. and Plains
    Marketing, L.P.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.12+</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Branded Jobber Contract, dated December&nbsp;15, 2005, between
    BP Products North America, Inc. and MAPCO Express, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.13*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Form of Delek US Holdings, Inc. 2006 Long-Term Incentive Plan.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.14*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Summary of Director Compensation for Non-Employees and for
    Non-Affiliates of Delek Group Ltd.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>10</TD>
    <TD align="left" valign="top" nowrap>.15</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Management and Consulting Agreement, dated as of January&nbsp;1,
    2006, by and between Delek Group Ltd. and Delek
    US&nbsp;Holdings, Inc.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>16</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Letter from Ernst&nbsp;&#38; Young LLP re Change in Certifying
    Accountant.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>16</TD>
    <TD align="left" valign="top" nowrap>.2</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Letter from Mayer Hoffman McCann P.C. re Change in Certifying
    Accountant.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>21</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Subsidiaries of the Registrant.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.1*</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Fulbright&nbsp;&#38; Jaworski L.L.P. (included in
    Exhibit&nbsp;5.1).</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.2</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Ernst&nbsp;&#38; Young LLP.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.3</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Ernst&nbsp;&#38; Young LLP.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.4</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Ernst&nbsp;&#38; Young LLP.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>23</TD>
    <TD align="left" valign="top" nowrap>.5</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Consent of Mayer Hoffman McCann P.C.</TD>
</TR>

<TR>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" nowrap>24</TD>
    <TD align="left" valign="top" nowrap>.1</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
    Power of Attorney (on signature page).</TD>
</TR>

</TABLE>
</CENTER>
</BODY>
</HTML>
[{"type": "S-1", "sequence": "1", "filename": "g99350sv1.htm", "description": "S-1", "secsgml_size_bytes": 2518184}]
{"company-data": {"conformed-name": "Delek US Holdings, Inc.", "cik": "0001351541", "irs-number": "522319066"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-131675", "film-number": "06589812"}, "business-address": {"phone": "615-771-6701"}, "mail-address": {"street1": "830 CRESCENT CENTRE DRIVE", "street2": "SUITE 300", "city": "FRANKLIN", "state": "TN", "zip": "37067"}}
S-1
Table of Contents
As filed with the Securities and Exchange Commission on
February 8, 2006
Registration
No.
333-
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
DELEK US HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware
5500
52-2319066
(State or other jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification Number)
830 Crescent Centre Drive, Suite 300
Franklin, Tennessee 37067
(615) 771-6701
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
Ezra Uzi Yemin, President and Chief Executive Officer
Delek US Holdings, Inc.
830 Crescent Centre Drive, Suite 300
Franklin, Tennessee 37067
(615) 771-6701
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Andrew C. Freedman, Esq.
Mara H. Rogers, Esq.
Fulbright & Jaworski L.L.P.
666 Fifth Avenue
New York, New York 10103
Telephone (212) 318-3000
Fax (212) 318-3400
D. Rhett Brandon, Esq.
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
Telephone (212) 455-2000
Fax (212) 455-2502
Approximate date of commencement of proposed sale to
public:
As soon as practicable after this Registration
Statement becomes effective.
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act of 1933, as amended (the
"Securities Act"), check the following
box.
o
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same
offering.
o
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering.
o
If this Form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following
box and list the Securities Act registration statement number of
the earlier effective registration statement for the same
offering.
o
CALCULATION OF REGISTRATION FEE
Title of Each Class of
Proposed Maximum
Amount of
Securities to be Registered
Aggregate Offering Price(1)
Registration Fee
Common stock, $0.01 par value per share
$230,000,000
$24,610
(1)
Estimated solely for the purpose of calculating the registration
    fee pursuant to Rule 457(o) under the Securities Act. The
    proposed maximum aggregate offering price includes amounts
    attributed to shares of common stock that the underwriters may
    purchase if they exercise their option to purchase additional
    shares.
The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a)
of the Securities Act or until the Registration Statement shall
become effective on such date as the Securities and Exchange
Commission, acting pursuant to said Section 8(a), may
determine.
Table of Contents
The
information in this preliminary prospectus is not complete and
may be changed. We may not sell these securities until the
Registration Statement filed with the Securities and Exchange
Commission is effective. This preliminary prospectus is not an
offer to sell the securities, nor is it a solicitation of an
offer to buy the securities, in any state where an offer or sale
of the securities is not permitted.
Subject to Completion,
dated                         ,
2006
PROSPECTUS
Shares
DELEK US HOLDINGS, INC.
Common Stock
We are
selling                      shares
of our common stock in this initial public offering. We expect
to use a portion of the net proceeds from this offering to fully
repay the outstanding intercompany indebtedness owed to our
affiliate, Delek – The Israel Fuel Corporation Ltd.,
and to our parent, Delek Group Ltd.
Prior to this offering, Delek Group Ltd. owned indirectly all of
our capital stock. Upon completion of this offering, without
giving effect to the exercise of the underwriters' option
to purchase additional shares, Delek Group Ltd. will own
approximately      % of our common
stock. After this offering, Delek Group Ltd. will continue to
control us.
No public market currently exists for our common stock. We
expect to apply for listing of our common stock on the New York
Stock Exchange under the symbol
"          ."
We currently expect that the initial public offering price will
be between
$          and
$           per
share.
Investing in our common stock involves risks. See "Risk
Factors" beginning on page 12.
Per Share
Total
Initial Public Offering Price
$
$
Underwriting Discount
$
$
Proceeds, before expenses, to Delek US Holdings, Inc.
$
$
We have granted the underwriters a
30-day
option to
purchase up to an aggregate
of                     additional
shares on the same terms and conditions as set forth above if
the underwriters sell more
than                     shares
of common stock in this offering.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
Lehman Brothers, on behalf of the underwriters, expects to
deliver the shares on or
about                     ,
2006.
Lehman Brothers
Citigroup
,
2006
TABLE OF CONTENTS
Page
Prospectus Summary
1
Risk Factors
12
Cautionary Statement Regarding
    Forward-Looking Statements
30
Use of Proceeds
32
Dividend Policy
32
Capitalization
33
Dilution
35
Selected Historical Consolidated Financial
    Information
37
Unaudited Pro Forma Condensed Consolidated
    Financial Data
43
Management's Discussion And Analysis
    Of Financial Condition And Results Of Operations
48
Our Industry
71
Business
79
Management
97
Principal Stockholders
107
Certain Relationships and Related
    Transactions
109
Description of Capital Stock
112
Shares Eligible for Future Sale
116
Material United States Federal Income Tax
    Considerations to Non-U.S. Holders
118
Underwriting
121
Legal Matters
125
Change in Accountants
125
Experts
125
Where You Can Find More Information
126
Glossary of Selected Terms
127
EX-10.1: EMPLOYMENT AGREEMENT
EX-10.1.A: AMENDMENT TO EMPLOYMENT AGREEMENT
EX-10.1.B: AMENDMENT TO EMPLOYMENT AGREEMENT
EX-10.2: CONSULTING AGREEMENT
EX-10.5: DISTRIBUTION SERVICE AGREEMENT
EX-10.6: RPC AGREEMENT
EX-10.6.A: ASSIGNMENT AND ASSUMPTION AGREEMENT
EX-10.6.B: ASSIGNMENT OF THE RPC AGREEMENT
EX-10.7: AMENDED AND RESTATED CREDIT AGREEMENT
EX-10.7.A: 1ST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
EX-10.7.B: 2ND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
EX-10.7.C: 3RD AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
EX-10.8: AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
EX-10.8.A: FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
EX-10.9: STOCK PURCHASE AGREEMENT
EX-10.10: REFINERY PURCHASE AND SALE AGREEMENT
EX-10.10.A: AMENDMENT TO REFINERY PURCHASE AND SALE AGREEMENT
EX-10.10.B: SECOND AMENDMENT TO REFINERY PURCHASE AND SALE AGREEMENT
EX-10.11: PIPELINE CAPACITY LEASE AGREEMENT
EX-10.11.A: ONE-YEAR RENEWAL OF PIPELINE CAPACITY LEASE AGREEMENT
EX-10.11.B: ASSIGNMENT OF THE PIPELINE CAPACITY LEASE AGREEMENT
EX-10.11.C: AMENDMENT TO ONE-YEAR RENEWAL OF PIPELINE CAPACITY LEASE AGREEMENT
EX-10.11.D: EXTENSION OF PIPELINE CAPACITY LEASE AGREEMENT
EX-10.12: BRANDED JOBBER CONTRACT
EX-10.15:MANAGEMENT AND CONSULTING AGREEMENT
EX-16.1: LETTER RE CHANGE IN CERTIFYING ACCOUNTANT
EX-16.2: LETTER RE CHANGE IN CERTIFYING ACCOUNTANT
EX-21.1: SUBSIDIARIES OF THE REGISTRANT
EX-23.2: CONSENT OF ERNST AND YOUNG LLP
EX-23.3: CONSENT OF ERNST AND YOUNG LLP
EX-23.4 CONSENT OF ERNST AND YOUNG LLP
EX-23.5: CONSENT OF MAYER HOFFMAN MCCANN PC
You should rely only on the information contained in this
prospectus or to which we have referred you. We have not
authorized anyone to provide you with information that is
different from that contained in this prospectus. This
prospectus may only be used where it is legal to sell these
securities. The information in this prospectus may be accurate
only on the date of this prospectus regardless of the time of
delivery of this prospectus.
Dealer Prospectus Delivery Obligation
Until                     ,
2006 (the 25th calendar day after date of this prospectus),
all dealers that effect transactions in these securities,
whether or not participating in this offering, may be required
to deliver a prospectus. This is in addition to the
dealer's obligation to deliver a prospectus when acting as
an underwriter and with respect to unsold allotments or
subscriptions.
Industry and Market Data
This prospectus includes market share and industry data that we
obtained from internal research, publicly available information
and industry publications and surveys. Our internal research is
based upon management's understanding of industry
conditions and has not been verified by any independent sources.
Industry surveys and publications generally state that the
information contained therein has been obtained from sources
believed to be reliable. Neither we nor the underwriters make
any representation as to the accuracy of such information.
Trademarks, Trade Names and Servicemarks
This prospectus includes trademarks, trade names and
servicemarks of Delek US Holdings, Inc. and its subsidiaries.
This prospectus also refers to trademarks, trade names and
servicemarks of other entities. All rights are reserved. The
mention of such trademarks, trade names and servicemarks in this
prospectus is made with due recognition of the rights of these
entities and without any intent to misappropriate such names or
marks. All other trademarks, trade names and servicemarks
appearing in the registration statement are the property of
their respective owners.
Table of Contents
General
We conduct our business primarily through our operating
subsidiaries, each of which is a direct or indirect wholly-owned
subsidiary of Delek US Holdings, Inc. For purposes of this
prospectus, unless the context otherwise requires, all
references herein to "our company," "Delek,"
"we," "us" and "our" refer to
Delek US Holdings, Inc. and its consolidated subsidiaries and
their predecessors. In addition, unless otherwise specified, all
references in this prospectus to the number of stores that we
own or operate or to the number of dealer-operated retail
locations are as of December 15, 2005. You should refer to
the "Glossary of Selected Terms" beginning on
page 127 for definitions of some of the terms we use to
describe our business and industry.
ii
Table of Contents
PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in
this prospectus but might not contain all of the information
that is important to you. Before investing in our common stock,
you should read the entire prospectus carefully, including the
"Risk Factors" section and our historical and pro
forma consolidated financial statements and the notes thereto
included elsewhere in this prospectus.
Unless otherwise indicated, the information contained in this
prospectus assumes that the underwriters' option to
purchase additional shares is not exercised.
Our Company
Company Overview
We are a diversified energy business focused on petroleum
refining and supply and on retail marketing. Our business
consists of two main operating segments: refining and retail.
Our refining segment operates a high conversion, moderate
complexity independent refinery in Tyler, Texas. Our retail
segment markets gasoline, diesel and other refined petroleum
products and convenience merchandise through a network of
349 company-operated retail fuel and convenience stores. We
also have a wholesale fuel distribution operation. Since our
founding in 2001, we have grown rapidly through the acquisition
of refining and convenience store-related assets. We believe
that our performance-driven, results-oriented corporate culture
is a key element of our success in executing our strategy and
achieving competitive advantages.
Refining segment.
Our refining segment operates a high
conversion, moderate complexity independent refinery with a
design crude distillation capacity of 60,000 barrels per
day, or bpd, along with an associated crude oil pipeline and
light products loading facilities. The Tyler refinery includes a
fluidized catalytic cracking unit and a delayed coker, enabling
us to produce over 93% light products and less than 2% heavy oil
products. The refinery is located in the city of Tyler in East
Texas, and is the only supplier of a full range of refined
petroleum products within a radius of approximately
115 miles of its location. Crude oil, most of which is
produced locally, is delivered to the Tyler refinery primarily
by pipeline, either through 65 miles of Delek-owned
pipeline or a third-party pipeline that we lease. The Tyler
refinery has the ability to produce and sell a full range of
gasoline, diesel, jet fuels and petrochemical feedstocks. The
Tyler refinery's refined petroleum products are marketed
through our truck loading facilities and third-party pipelines
directly to major oil companies such as ExxonMobil and Chevron,
independent refiners and marketers such as Valero, and jobbers,
distributors, utility and transportation companies and
independent retail fuel operators.
Retail segment.
Our retail segment markets gasoline,
diesel and other refined petroleum products and convenience
merchandise through our network of 349 company-operated
retail fuel and convenience stores located in Alabama, Arkansas,
Georgia, Kentucky, Louisiana, Mississippi, Tennessee and
Virginia. Our stores operate primarily under the MAPCO
Express
®
,
East
Coast
®
and Discount Food
Mart
tm
brands. Approximately 93% of our stores are concentrated in
Tennessee, Alabama and Virginia. Our stores market gasoline and
diesel under our fuel brands as well as the
BP
®
,
Exxon
®
,
Shell
®
and
Chevron
®
brands. We also market a broad selection of beverages and
merchandise designed to appeal to the convenience needs of our
customers. In addition, we have begun to sell proprietary food
offerings under our Grille
Marx
tm
brand. We also have a wholesale fuel distribution operation that
supplies more than 50 dealer-operated retail locations.
For the nine months ended September 30, 2005 and the year
ended December 31, 2004, we generated net sales of
$1.4 billion and $857.9 million, respectively, net
income of $39.5 million and $7.3 million,
respectively, and Adjusted EBITDA of $98.5 million and
$31.9 million, respectively. Our results for the nine
months ended September 30, 2005 reflect the operations of
the Tyler refinery since we acquired it on April 29, 2005.
See "— Summary Consolidated Financial Information
and Other Data" and "Selected Historical Consolidated
Financial Information" for our calculation of Adjusted
EBITDA, as well as a reconciliation of Adjusted EBITDA amounts
to net income, the most directly comparable generally accepted
accounting principles, or GAAP, measure.
1
Table of Contents
Market Opportunities
We believe the following factors create a positive outlook for
our business:
Major oil and gas companies and retailers continue to divest
refining and retail assets.
Over the past few years, several
major oil and gas companies and retailers have divested
portfolios of refining and retail assets. We believe that major
oil and gas companies and retailers will continue to divest
refining and retail assets to free their capital and
managements' attention for larger scale investment
opportunities, thus providing us with attractive acquisition and
growth opportunities.
Substantial opportunities for consolidation in the
U.S. convenience store industry.
The
U.S. convenience store industry is highly fragmented. We
believe that smaller operators typically do not have the
combination of operational and financial resources necessary to
implement the marketing strategies and information technology
systems that companies of our size do, and that they do not
enjoy our economies of scale when negotiating contracts, such as
contracts for merchandise or fuel supply. We believe that these
smaller operators are at a competitive disadvantage to us and
that we will continue to be presented with additional
acquisition opportunities.
Favorable supply/demand dynamics in the U.S. refining
sector.
We believe that high capital costs and environmental
regulatory requirements have limited the growth of refining
capacity, the construction of new refineries and the expansion
of existing refineries in the United States over the past
30 years. We believe that limited refining capacity in the
United States, along with increasing utilization rates and
steadily increasing demand for refined petroleum products, has
produced a sustainable shift in market dynamics that will
benefit our refining segment.
Expansion opportunities beyond our current geographic
footprint.
Our retail business is currently concentrated in
the southeastern United States, especially in Tennessee, Alabama
and Virginia. We believe that states adjacent to those in which
we currently operate, or in which we currently have a relatively
small number of stores, such as Florida, North Carolina, South
Carolina, Arkansas, Georgia, Mississippi, Kentucky, Louisiana
and Texas, provide opportunities for us to expand.
Competitive Advantages
We believe we enjoy the following competitive advantages:
Proven ability to integrate acquisitions.
We have been
successful in rapidly integrating our refinery acquisition, four
large retail fuel and convenience store acquisitions and several
smaller acquisitions since our formation in 2001. Since our
acquisition of the Tyler refinery, we have implemented
managerial and operational enhancements that have resulted in
increased refinery utilization, an increase in our truck rack
margins and expansion of our customer base. We have also
improved the productivity and profitability of the convenience
stores we acquired by implementing merchandising and fuel sales
initiatives, instituting operating expense and loss prevention
controls, reducing overhead and centralizing functions such as
accounting, purchasing and information technology.
Niche market refinery.
Our Tyler refinery is located in a
niche market and primarily produces high value transportation
fuels. Our Tyler refinery is the only supplier of a full range
of refined petroleum products within a radius of approximately
115 miles of its location. Our owned and leased pipelines
are connected to five crude oil pipeline systems that provide us
access to East Texas, West Texas and other domestic and foreign
crude oils. The refinery owns the larger of two truck rack
facilities for the loading of transportation fuels in the
vicinity of Tyler, Texas and supplies the other one. We believe
this provides us with a cost advantage over other companies that
would need to import fuel via truck from outside the region.
Management focus and merchandising and operations
expertise.
We believe that our management approach
encourages employee participation in decision-making. This
approach allows us to identify market trends and opportunities
and to rapidly implement store specific strategies and programs
to exploit those trends and opportunities to improve results of
operations at our stores. Human and technological intelligence
is key to our retail business strategy, which is based on the
concept of the "neighborhood" store. Our
2
Table of Contents
management approach also incorporates a strong focus on
controlling operating expenses and loss prevention, which has
been an important element in the successful development of our
retail segment.
Strong market presence in our existing retail markets.
"MAPCO" is a well-recognized name throughout the
southeastern United States, and our "East Coast" and
"Discount Food Mart" brands are well known in Virginia
and Alabama, the respective markets in which we operate. We
believe that we rank first among convenience store operators in
terms of the number of stores in each of the Nashville, Memphis
and Northern Alabama regions and third among convenience store
operators in the Richmond, Virginia region. This concentration
of stores enables us to realize economies of scale and
cost-efficiencies and provides us with a platform for continued
growth through acquisitions in these core regions.
Scalable information technology.
We believe that our
information technology systems allow us to maximize sales and
margins and reduce inefficiencies in our cost structure by
delivering timely and focused feedback on margins and sales
volumes, enabling our merchandising managers to react quickly to
maximize our profit opportunities.
Experienced Management.
We believe that our strong
management is a key element of our competitive advantages and
our ability to continue to successfully execute our strategies.
The management teams of both our refining and retail segments
have extensive industry experience, which includes a strong
cross-section of disciplines, including marketing, operations,
finance and information technology.
Strategy
In order to strengthen our market position, enhance growth and
maximize our profitability and cash flow, we intend to:
Pursue opportunistic acquisitions that strengthen our core
markets and leverage our core competencies.
We have a track
record of expanding our business through asset acquisitions. As
we seek to grow, we will opportunistically target assets or
businesses where we can apply our core competencies. Our goal is
to continue to expand our retail business through acquisitions
and new store development, and we intend to actively pursue
additional refinery acquisitions. We also plan to selectively
pursue additional acquisitions of logistic and other assets
complementary to our refinery.
Modernize and improve the profitability of our Tyler
refinery.
We have implemented, and intend to continue to
implement, operational changes and capital investments to
improve the efficiency, processing capacity and utilization of
our Tyler refinery. Our management team has begun to and will
continue to source new crude supplies, including foreign crude,
to provide us with greater flexibility in optimizing the
feedstock supply to the Tyler refinery. We believe that our
operational improvements and increased crude oil delivery
capacity will allow us to increase the Tyler refinery's
average crude oil throughput from historic levels of
approximately 50,000 bpd to almost 60,000 bpd by early
2006.
Grow the customer base and improve the profitability of our
Tyler-area niche market.
We believe that there is additional
demand in the Tyler, Texas area for products produced at our
Tyler refinery. We plan to continue to target potential
customers who currently have supply contracts with others but
may be interested in purchasing from us. In addition to
increasing sales, our management team intends to continue
renegotiating marketing contracts on more favorable terms, in
order to further benefit from the competitive advantage we have
in our niche market location.
Reinforce our brand recognition through targeted retail
merchandising strategies.
We intend to maintain our position
as a strong retail competitor in the southeastern United States.
To increase brand awareness in our markets, we are in the
process of implementing a new branding and re-imaging campaign
that will include the retrofitting of select existing stores and
the building of new stores with the "MAPCO Mart"
brand. We aim to maintain our existing customer base while
attracting a more upscale clientele to our re-imaged stores.
Continually renew the physical assets of our retail
business.
We intend to ensure that our retail stores are
positioned to maximize customer traffic and provide our
consumers with an enhanced purchasing
3
Table of Contents
experience. We believe that upgrading our retail stores, as well
as closing or selling underperforming stores, will lead to
improved operating results.
Develop innovative information technology applications in all
of our businesses.
We intend to continue our investment in
technological infrastructure. We believe that by leveraging our
innovative information technology platform, we will be able to
better address the needs of our customers. By optimizing our
information technology, we also expect to improve our operating
efficiencies and to improve our management of inventory.
Summary Risks
Our business is subject to numerous risks as discussed more
fully in the section entitled "Risk Factors"
immediately following this Prospectus Summary. We believe that
the most significant of these risks include the following:
•
competition;
•
changes in, or the failure to comply with, the extensive
    government regulations applicable to our industry segments;
•
the availability, cost and price volatility of crude oil, other
    refinery feedstocks and refined petroleum products;
•
our ability to integrate acquired businesses and implement our
    growth strategy;
•
general economic and business conditions, particularly levels of
    spending relating to travel and tourism or conditions affecting
    the southeastern United States;
•
dependence on one principal fuel supplier and one wholesaler for
    a significant portion of our convenience store merchandise;
•
operating hazards, natural disasters, casualty losses and other
    matters beyond our control;
•
increases in our debt levels and restrictive covenants in our
    debt agreements;
•
potential conflicts of interest between our major stockholder
    and other stockholders; and
•
our discretion in the use of net proceeds from this offering.
Company History
We are a Delaware corporation formed in April 2001. We are an
indirect wholly-owned subsidiary of Delek Group Ltd., a
conglomerate that is domiciled and publicly traded in Israel,
which has significant interests in fuel supply businesses and
which is controlled by Mr. Yitzchak Sharon Teshuva, an
Israeli citizen. We were formed by Delek Group Ltd. in
connection with our acquisition in May 2001 of 198 retail fuel
and convenience stores from a subsidiary of The Williams
Companies. Since then, we have completed several other
acquisitions of retail fuel and convenience stores. In 2005, we
expanded our scope of operations to include complementary
petroleum refining and wholesale and distribution businesses by
acquiring the Tyler refinery.
Corporate Information
Our principal executive offices are located at 830 Crescent
Centre Drive, Suite 300, Franklin, Tennessee 37067, and our
telephone number at that address is (615) 771-6701. Our
website is located at www.delekus.com. Information contained on
our website does not constitute a part of this prospectus.
4
Table of Contents
The Offering
Common stock offered
shares
Common stock to be outstanding after the offering
shares(1)
Underwriters' option(1)
We have granted the underwriters a
30-day
option to
    purchase from us up to an aggregate
    of                      additional
    shares of our common stock if they sell more
    than            shares
    in the offering.
Use of proceeds
We estimate that the net proceeds to us from this offering will
    be approximately
    $                    .
    We expect to use a portion of the net proceeds from this
    offering to repay $52.5 million principal amount of our
    debt, plus accrued interest, of which $42.5 million, plus
    accrued interest, is owed to our affiliates. We expect to use
    the remainder of the net proceeds for general corporate
    purposes, including working capital, capital expenditures and
    possible acquisitions.
Dividend policy
We currently intend to pay quarterly cash dividends on our
    common stock at an initial annual rate of
    $                     per
    share
    commencing                                                             .
    The declaration and payment of future dividends to holders of
    our common stock will be at the discretion of our board of
    directors and will depend upon many factors, including our
    results of operations, financial condition, earnings, capital
    requirements, restrictions in our debt agreements and legal
    requirements.
Proposed New York Stock Exchange ("NYSE") symbol
Risk factors
An investment in our common stock involves a high degree of
    risk. You should carefully consider the risk factors set forth
    under "Risk Factors" beginning on page 12 and the
    other information contained in this prospectus prior to making
    an investment decision regarding our common stock.
(1)
The number of shares of common stock to be outstanding after the
    offering:
•
gives effect to a      -for-one stock
    split of our common stock, which will be effective immediately
    prior to this offering;
•
excludes                      shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $           per
    share;
•
excludes                      shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;
•
excludes                      shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form
S-8
registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form
S-8
we intend
    to file within 30 days after the completion of this
    offering;
•
excludes                      shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan; and
•
assumes no exercise by the underwriters of their option to
    purchase up
    to                     additional
    shares of common stock from us if they sell more
    than                      shares
    in the offering.
5
Table of Contents
Summary Consolidated Financial Information and Other Data
The following table sets forth our summary historical
consolidated financial information and other data. The
historical statement of operations and cash flow data for the
fiscal years ended December 31, 2002, 2003 and 2004 are
derived from, and should be read in conjunction with, our
audited consolidated financial statements and related notes
appearing elsewhere in this prospectus. The historical statement
of operations and cash flow data for the nine months ended
September 30, 2004 and September 30, 2005 and the
historical balance sheet data as of September 30, 2005 are
derived from our unaudited consolidated financial statements
appearing elsewhere in this prospectus, which, in the opinion of
management, include all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the data for
the periods presented. The results of operations for the interim
period are not necessarily indicative of the operating results
for the entire year or any future period. Additionally, our
financial condition and results of operations for certain
periods may not be comparable due to the acquisition of
Williamson Oil Co., Inc. effective April 30, 2004, the
acquisition of the Tyler refinery and related assets effective
April 29, 2005, various refinancings of indebtedness and
other transactions.
The information contained in this table should also be read in
conjunction with "Use of Proceeds,"
"Capitalization," "Selected Historical
Consolidated Financial Information," "Unaudited Pro
Forma Condensed Consolidated Financial Data,"
"Management's Discussion and Analysis of Financial
Condition and Results of Operations" and the consolidated
financial statements and accompanying notes thereto, all
included elsewhere in this prospectus.
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Statement of Operations Data:
Net sales:
Retail
$
549,632
$
600,157
$
857,834
$
617,955
$798,974
Refining
—
—
—
—
588,326
Other
—
—
65
16
241
Total
549,632
600,157
857,899
617,971
1,387,541
Expenses:
Cost of goods sold
460,337
500,181
730,780
526,294
1,179,495
Operating expenses
62,050
62,704
80,060
58,289
92,286
General and administrative expenses
12,227
12,874
15,122
10,665
17,037
Depreciation and amortization
7,426
8,784
12,374
8,674
11,472
(Gain) on disposal of assets
—
(430
)
(898
)
(227
)
(1,638
)
Losses on forward contract activities(3)
—
—
—
—
10,923
542,040
584,113
837,438
603,695
1,309,575
Operating income
7,592
16,044
20,461
14,276
77,966
Interest expense, net
5,747
5,872
7,059
5,001
10,765
Interest expense-related party
—
120
1,210
778
2,287
Write-off of deferred financing costs(4)
—
—
—
—
3,466
(Gain) loss on derivative instruments(5)
2,583
(242
)
727
875
(1,014
)
Guarantee fees(6)
—
—
—
—
313
8,330
5,750
8,996
6,654
15,817
6
Table of Contents
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Income (loss) before income taxes and cumulative effect of
    change in accounting policy
(738
)
10,294
11,465
7,622
62,149
Income tax expense (benefit)
(264
)
3,814
4,132
2,872
22,362
Income before cumulative effect of change in accounting policy
(474
)
6,480
7,333
4,750
39,787
Cumulative effect of change in accounting policy
—
—
—
—
267
Net income (loss)
$
(474)
$
6,480
$
7,333
$
4,750
$39,520
Basic and diluted earnings (loss) per share(7)
$
$
$
$
$
Weighted average shares, basic and diluted(7)
Cash Flow Data:
Cash flows provided by (used in) operating activities
$
17,528
$
26,333
$
24,926
$
16,218
$139,230
Cash flows provided by (used in) investing activities
(12,066
)
(16,149
)
(27,343
)
(26,763
)
(83,588
)
Cash flows provided by (used in) financing activities
(4,465
)
(2,242
)
5,616
13,962
69,279
Net (decrease) increase in cash and cash equivalents
$
997
$
7,942
$
3,199
$
3,417
$124,921
Segment Data (8):
Nine Months Ended September 30, 2005
Corporate,
Other and
Refining(2)
Retail
Eliminations(9)
Consolidated
(Dollars in thousands)
Net sales (excluding intercompany sales)
$588,326
$798,974
$241
$1,387,541
Intercompany sales
888
—
(888
)
—
Cost of goods sold
489,401
690,982
(888
)
1,179,495
Operating expenses
27,636
64,402
248
92,286
Segment contribution margin
$72,177
$43,590
$(7
)
115,760
General and administrative expenses
17,037
Depreciation and amortization
11,472
(Gain) on disposal of assets
(1,638
)
Losses on forward contract activities(3)
10,923
Operating income
$77,966
7
Table of Contents
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except pricing information)
Other Data:
Adjusted EBITDA(10)
$15,018
$24,398
$31,937
$22,723
$98,456
Capital expenditures
9,773
5,181
6,974
4,832
8,415
Key Operating Statistics:
REFINING SEGMENT
Days operated in period(2)
155
Total sales volume (average barrels per day)
52,646
Products manufactured (average barrels per day)
Gasoline
27,366
Diesel/Jet
21,288
Petrochemicals, LPG, NGLs
2,517
Other
1,061
Total production
52,232
Throughput (average barrels per day)
Crude oil
52,887
Other feedstocks
878
Total throughput
53,765
Per barrel of sales
Refining operating margin(11)
$12.23
Direct operating expenses
$3.39
RETAIL SEGMENT
Number of stores (end of period)
236
243
331
332
328
Average number of stores
236
242
310
302
329
Retail fuel sales (thousands of gallons)
267,396
267,476
315,294
231,315
249,507
Average retail gallons per average number of stores (in
    thousands)
1,133
1,105
1,017
766
758
Retail fuel margin (per gallon)
$0.130
$0.154
$0.155
$0.149
$0.164
Merchandise sales
$204,536
$206,950
$261,232
$191,728
$219,840
Merchandise margin
26.7
%
28.4
%
29.5
%
29.4
%
30.0
%
As of September 30, 2005
Actual
As Adjusted(12)
As Further Adjusted(13)
(Dollars in thousands)
Balance Sheet Data:
Cash and cash equivalents
$
147,027
$
104,527
$
Total debt, including current maturities
282,678
275,178
Total stockholder's equity
95,274
95,274
8
Table of Contents
(1)
Effective April 30, 2004, we completed the acquisition of
    100% of the outstanding stock of Williamson Oil Co., Inc., or
    Williamson Oil. Because the results of operations of Williamson
    Oil are included in our financial results from the date of
    acquisition, a comparison of our
period-to
-period
    financial results may not necessarily be meaningful. See
    "Unaudited Pro Forma Condensed Consolidated Financial
    Data," which shows what our results of operations might
    have been had we acquired Williamson Oil on January 1, 2004.
(2)
Effective April 29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155 days in the fiscal period ended
    September 30, 2005. Because the results of operations of
    the Tyler refinery and related assets are included in our
    financial results from the date of acquisition, a comparison of
    our
period-to
-period
    financial results may not necessarily be meaningful. See
    "Unaudited Pro Forma Condensed Consolidated Financial
    Data," which shows what our results of operations might
    have been in 2004 and the nine months ended September 30,
    2005 had we acquired the Tyler refinery and related assets on
    January 1, 2004.
(3)
In order to mitigate the risks of changes in the market price of
    crude oil and refined petroleum products, we entered into
    forward contracts to fix the purchase price of crude and sales
    price of specific refined petroleum products for a predetermined
    number of units at a future date. The fair value adjustment of
    these contracts in the third quarter of 2005 resulted in a loss
    of $10.9 million. These contracts were entered into with an
    affiliate of Citigroup Global Markets Inc., one of the
    underwriters of this offering.
(4)
In 2005, we refinanced a significant portion of our existing
    debt. As a result, financing costs associated with the
    refinanced debt were written-off.
(5)
We have entered into interest rate swap and cap agreements in
    connection with a portion of our floating rate debt. These
    interest rate swap and cap agreements are marked to fair value
    each period.
(6)
In 2005, our parent company guaranteed a portion of our new debt
    and other instruments in connection with the acquisition of the
    Tyler refinery. We have agreed to pay our parent a fee for these
    guarantees.
(7)
Gives effect to
    a
for-one
split of our common stock, which will be effective immediately
    prior to this offering.
(8)
Statement of Accounting Standards No. 131,
Disclosures
    About Segments of an Enterprise and Related Information,
requires disclosure of a measure of segment profit or loss. In
    connection with the purchase of the Tyler refinery and related
    assets on April 29, 2005, management began viewing our
    company's operating results in two reportable segments:
    retail and refining. We measure the operating performance of
    each segment based on segment contribution margin. We define
    segment contribution margin as net sales less cost of goods sold
    and operating expenses, excluding depreciation and amortization.
For the retail segment, cost of goods sold comprises the costs
    of specific products sold. Operating expenses include costs such
    as wages of employees at the stores, lease expense for the
    stores, utility expense for the stores and other costs of
    operating the stores, excluding depreciation and amortization.
For the refining segment, cost of goods sold includes all the
    costs of crude oil, feedstocks and related transportation.
    Operating expenses include the costs associated with the actual
    operations of the refinery, excluding depreciation and
    amortization.
Prior to the purchase of the Tyler refinery and related assets,
    we had only the retail segment. Accordingly, segment data prior
    to 2005 is not applicable.
(9)
Consists of fuel credit card services provided by one of our
    subsidiaries and eliminations of intercompany transactions.
(10)
EBITDA represents earnings before income tax expense, interest
    expense, the write-off of deferred financing costs, (gain) loss
    on derivative instruments, guarantee fees, depreciation and
    amortization. Adjusted EBITDA represents earnings before income
    tax expense, interest expense, the write-off of deferred
    financing costs, (gain) loss on derivative instruments,
    losses on forward contract activities,
9
Table of Contents
guarantee fees, depreciation, amortization and (gain) loss on
    disposal of assets. EBITDA and Adjusted EBITDA, however, are not
    recognized measurements under GAAP. Our management believes that
    the presentation of Adjusted EBITDA is useful to investors
    because it is frequently used by securities analysts, investors
    and other interested parties in the evaluation of companies in
    our industry.
In addition, our management believes that Adjusted EBITDA is
    useful in evaluating our operating performance compared to that
    of other companies in our industry because the calculation of
    Adjusted EBITDA generally eliminates the effects of financings,
    income taxes, risk management activities and the disposal of
    assets, items which may vary for different companies for reasons
    unrelated to overall operating performance.
Adjusted EBITDA has limitations as an analytical tool, and you
    should not consider it in isolation, or as a substitute for
    analysis of our results as reported under GAAP. Some of these
    limitations are:
•
Adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or contractual commitments;
•
Adjusted EBITDA does not reflect the interest expense or the
    cash requirements necessary to service interest or principal
    payments on our debt;
•
Adjusted EBITDA does not reflect changes in or cash requirements
    for our working capital needs; and
•
Our calculation of Adjusted EBITDA may differ from the EBITDA
    and Adjusted EBITDA calculations of other companies in our
    industry, limiting its usefulness as a comparative measure.
Because of these limitations, Adjusted EBITDA should not be
    considered a measure of discretionary cash available to us to
    invest in the growth of our business. We compensate for these
    limitations by relying primarily on our GAAP results and using
    Adjusted EBITDA only on a supplemental basis.
The following table reconciles net income (loss) to Adjusted
    EBITDA for the periods presented:
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004
2004
2005
(Dollars in thousands)
Net income (loss)
$(474
)
$6,480
$7,333
$4,750
$
39,520
Interest expense, net
5,747
5,992
8,269
5,779
13,052
Write-off of deferred financing costs(4)
—
—
—
—
3,466
(Gain) loss on derivative instruments(5)
2,583
(242
)
727
875
(1,014
)
Guarantee fees(6)
—
—
—
—
313
Depreciation and amortization
7,426
8,784
12,374
8,674
11,472
Income tax expense (benefit)
(264
)
3,814
4,132
2,872
22,362
EBITDA
15,018
24,828
32,835
22,950
89,171
(Gain) on disposal of assets
—
(430
)
(898
)
(227
)
(1,638
)
Losses on forward contract activities(3)
—
—
—
—
10,923
Adjusted EBITDA
$
15,018
$
24,398
$
31,937
$
22,723
$
98,456
(11)
Refining operating margin per barrel is calculated by dividing
    the margin between net sales and cost of crude oil, feedstocks
    and related transportation by the total barrels sold at our
    refinery. Industry-wide refining results are driven and measured
    by the margins between refined petroleum product prices and the
    prices for crude oil, which are referred to as crack spreads:
    the differential in price between a representative barrel of
    benchmark refined petroleum products, such as gasoline or
    heating oil, and a barrel of benchmark crude oil. The
    US Gulf
    Coast
5-3-2
crack
    spread represents the differential between Platt's
    quotations for
3
/
5
of a barrel of US Gulf Coast Pipeline 87 Octane
    Conventional Gasoline and
2
/
5
of a barrel of US Gulf Coast Pipeline No. 2 Heating
    Oil (high sulfur diesel) on the one hand, and the
10
Table of Contents
first month futures price of
5
/
5
of a barrel of light sweet crude oil on the New York Mercantile
    Exchange, on the other hand. We compare our refining operating
    margin to these crack spreads to assess our operating
    performance relative to other participants in our industry.
(12)
As adjusted to give effect to the following transactions as if
    such transactions had occurred on September 30, 2005: the
    prepayment, on November 23, 2005, of $17.5 million of
    principal on the $35.0 million promissory note dated
    April 27, 2005 payable to Delek Group Ltd.; the prepayment,
    on November 23, 2005, of $10.0 million of principal on
    the $30.0 million promissory note dated April 26, 2005
    payable to Israel Discount Bank; the prepayment, on
    November 23, 2005, of $10.0 million of principal on
    the $20.0 million promissory note dated April 27, 2005
    payable to Bank Leumi USA; and our acquisition of retail fuel
    and convenience stores and other assets from BP Products North
    America, Inc., or BP, in December 2005 for $35.0 million,
    of which $5.0 million was financed with cash on hand and
    $30.0 million was financed from borrowings under our
    revolving credit facility.
(13)
As further adjusted to reflect our sale
    of                      shares
    of our common stock at a price of
    $           per
    share, the midpoint of the range set forth on the cover page of
    this prospectus and our use of proceeds, net of estimated
    underwriting discounts and commissions and estimated offering
    expenses that are payable by us.
11
Table of Contents
RISK FACTORS
An investment in our common stock involves various risks.
Before making an investment in our common stock, you should
carefully consider the following risks, as well as the other
information contained in this prospectus, including our
consolidated financial statements and the notes thereto and
"Management's Discussion and Analysis of Financial
Condition and Results of Operations." The risks described
below are those which we believe are the material risks we face.
Any of the risk factors described below or additional risks and
uncertainties not presently known to us, or that we currently
deem immaterial, could have a material adverse effect on our
business, financial condition and results of operations. As a
result, the trading price of our common stock could decline and
you may lose a part or all of your investment.
Risks Relating to Our Industry
We operate in a highly competitive industry, and
    competitive pressures may adversely affect us.
We compete with a broad range of companies in our refining and
petroleum product marketing operations. Many of these
competitors are integrated, multinational oil companies that are
substantially larger than we are. Because of their diversity,
integration of operations, larger capitalization, larger and
more complex refineries and greater resources, these companies
may be better able to withstand volatile market conditions, to
compete on the basis of price and to obtain crude oil in times
of shortage.
The industry and geographic areas in which we operate our retail
fuel and convenience stores are highly competitive and marked by
ease of entry and constant change in the number and type of
retailers offering the products and services found in our
stores. We compete with other convenience store chains, gas
stations, supermarkets, drug stores, discount stores, club
stores, mass merchants, fast food operations and other retail
outlets. In some of our markets, our competitors have been in
existence longer and have greater financial, marketing and other
resources than we do. As a result, our competitors may be able
to respond better to changes in the economy and new
opportunities within the industry.
In recent years, several non-traditional retailers, such as
supermarkets, club stores and mass merchants, have affected the
convenience store industry by entering the retail fuel business.
These non-traditional gasoline retailers have obtained a
significant share of the motor fuels market and we expect their
market share to grow. Because of their diversity, integration of
operations, experienced management and greater resources, these
companies may be better able to withstand volatile market
conditions or levels of low or no profitability in the retail
segment. In addition, these retailers may use promotional
pricing or discounts, both at the pump and in the store, to
encourage in-store merchandise sales. These activities by our
competitors could pressure us to offer similar discounts,
adversely affecting our profit margins. Additionally, the loss
of market share by our retail fuel and convenience stores to
these and other retailers relating to either gasoline or
merchandise could have a material adverse effect on our
business, financial condition and results of operations.
Independent owner-operators can operate stores with lower
overhead costs than ours. Should significant numbers of
independent owner-operators enter our market areas, retail
prices in some of our categories may be negatively affected, as
a result of which our profit margins may decline at affected
stores.
Our stores compete, in large part, based on their ability to
offer convenience to customers. Consequently, changes in traffic
patterns and the type, number and location of competing stores
could result in the loss of customers and reduced sales and
profitability at affected stores. Other major competitive
factors include ease of access, pricing, timely deliveries,
product and service selections, customer service, fuel brands,
store appearance, cleanliness and safety.
We operate in a highly regulated industry and increased
    costs of compliance with, or liability for violation of,
    existing or future laws, regulations and other requirements
    could significantly increase our costs of doing business.
Our industry is subject to extensive laws, regulations and other
requirements including, but not limited to, those relating to
environmental, employment, labor, immigration, minimum wages and
overtime pay, health benefits, working conditions, public
accessibility, the sale of alcohol and tobacco and other
12
Table of Contents
requirements. A violation of any of these requirements could
have a material adverse effect on our business, financial
condition and results of operations.
Under various federal, state and local environmental
requirements, as the owner or operator of our locations, we may
be liable for the costs of removal or remediation of
contamination at our existing or former locations, whether we
knew of, or were responsible for, the presence of such
contamination. We have incurred such liability in the past and
several of our current and former locations are the subject of
ongoing remediation projects. The failure to timely report and
properly remediate contamination may subject us to liability to
third parties and may adversely affect our ability to sell or
rent our property or to borrow money using our property as
collateral. Additionally, persons who arrange for the disposal
or treatment of hazardous substances also may be liable for the
costs of removal or remediation of these substances at sites
where they are located, regardless of whether the site is owned
or operated by that person. We typically arrange for the
treatment or disposal of hazardous substances in our refining
operations. We do not typically do so in our retail operations,
but we may nonetheless be deemed to have arranged for the
disposal or treatment of hazardous substances. Therefore, we may
be liable for removal or remediation costs, as well as other
related costs, including fines, penalties and damages resulting
from injuries to persons, property and natural resources.
Compliance with existing and future environmental requirements
regulating underground storage tanks may require significant
capital expenditures and increased operating and maintenance
costs. The remediation costs and other costs required to clean
up or treat contaminated sites could be substantial. We pay tank
registration fees and other taxes to state trust funds
established in states in which we operate retail fuel and
convenience stores. These state trust funds are expected to pay
or reimburse us for remediation expenses of up to
$1.0 million per site, less a deductible. However,
reimbursement from state trust funds will be dependent on the
maintenance and continued solvency of the various funds. We have
secured insurance to cover certain costs in excess of those paid
by state underground storage tank funds. There can be no
assurance, however, that such insurance will be sufficient.
In the future, we may incur substantial expenditures for
investigation or remediation of contamination that has not been
discovered at our current or former locations or locations that
we may acquire. We cannot assure you: that we have identified
all environmental liabilities at all of our current and former
locations; that material environmental conditions in addition to
those already known to us do not exist; that future requirements
will not impose material environmental liability on us; that an
undiscovered material environmental condition does not otherwise
exist as to any one or more of our locations; or that we will
not incur significant fines or penalties or be required to
significantly reduce operations as a result of any noncompliance
with environmental requirements. In addition, any failure by us
to comply with any environmental requirements or with any
expanded environmental requirements could have a material
adverse effect on our business, financial condition and results
of operations.
Various governmental entities including, without limitation, the
U.S. Environmental Protection Agency, or EPA, the
U.S. Coast Guard, the U.S. Department of
Transportation, and the Railroad Commission of Texas, have
authority over environmental matters relating to our pipeline,
and their regulations address safety issues relating to the
transportation of liquids, and procedures for responding to and
reporting releases of crude oil.
State laws regulate the sale of alcohol and tobacco products.
State and local regulatory agencies have the power to approve,
deny, suspend or revoke applications for, and approve or deny
renewals of, permits and licenses relating to the sale of these
products and to seek other remedies. In addition, certain states
regulate relationships, including overlapping ownership, among
alcohol manufacturers, wholesalers and retailers and may deny or
revoke a license if relationships in violation of these
requirements exist. A violation of these requirements by us or a
change in these requirements could have a material adverse
effect on our business, financial condition and results of
operations.
Food service businesses can be adversely affected by litigation
and complaints from customers or government authorities
resulting from food quality, illness, injury or other health
concerns or operating issues
13
Table of Contents
stemming from one store or a limited number of stores. Adverse
publicity about these allegations may adversely affect us,
regardless of whether the allegations are true, by discouraging
customers from buying food products from us. The filing of
lawsuits or claims against us concerning food served at our
convenience stores could have a material adverse effect on our
business, financial condition and results of operations.
In addition, new legal requirements, new interpretations of
existing legal requirements, increased legislative activity and
governmental enforcement and other developments could require us
to make additional unforeseen expenditures. Companies in the
petroleum industry, such as us, are currently a particular
target of investigative activity. For example, the Federal Trade
Commission recently launched an investigation of gasoline
pricing among producers and suppliers of petroleum products,
including us, and state officials have commenced price gouging
investigations of retail operators, including us. The assessment
of fines and penalties against us or damaging publicity as a
result of these investigations, or our need to incur costs
associated with complying with any resulting new legal or
regulatory requirements that are substantial and not adequately
provided for, could have a material adverse effect on our
business, financial condition and results of operations.
The prices of crude oil, other feedstocks and refined
    petroleum products are volatile and depend upon many factors
    that are beyond our control and could adversely affect our
    profitability.
Our earnings, cash flow and profitability from our refining
operations depend on the margin above fixed and variable
expenses (including the cost of refinery feedstocks, such as
crude oil) at which we are able to sell refined petroleum
products. Refining margins historically have been and are likely
to continue to be volatile, as a result of numerous factors
beyond our control, including the supply of and demand for crude
oil, other feedstocks, gasoline and other refined petroleum
products. Such supply and demand are affected by, among other
things:
•
changes in global and local economic conditions;
•
United States and foreign demand for fuel products;
•
worldwide political conditions, particularly in significant oil
    producing regions such as the Middle East, Western Coastal
    Africa, the former Soviet Union, and South America;
•
the level of foreign and domestic production of crude oil and
    refined petroleum products and the level of crude oil, other
    feedstocks and refined petroleum products imported into the
    United States;
•
utilization rates of refineries in the United States;
•
development and marketing of alternative and competing fuels;
•
events that cause disruptions in our distribution channels;
•
local factors, including market conditions, adverse weather
    conditions and the level of operations of other refineries and
    pipelines in our markets; and
•
U.S. government regulations.
Significant increases and volatility in costs of crude oil,
other feedstocks and refined petroleum products could result in
significant increases in the retail price of refined petroleum
products and in lower retail fuel gross margin per gallon.
Increases in the retail price of refined petroleum products
could impact consumer demand for fuel. In addition, 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 that are beyond our control, such as supply and demand
for fuel and utility services in both local and regional
markets. This volatility makes it extremely difficult to predict
the impact future wholesale cost fluctuations will have on our
business, financial condition and results of operations. These
factors could impact materially our fuel gallon volume, fuel
gross profit and overall customer traffic, which in turn would
adversely impact our merchandise sales.
14
Table of Contents
The nature of our business requires us to maintain substantial
quantities of crude oil, refined petroleum product and
blendstock inventories. Because crude oil and refined petroleum
products are commodities, we have no control over the changing
market value of these inventories. Because our refinery
inventory is valued at the lower of cost or market value under
the last-in, first-out, or LIFO, inventory valuation
methodology, if the market value of our inventory were to
decline to an amount less than our LIFO cost, we would record a
write-down of inventory and a non-cash charge to cost of sales.
Changes in consumer behavior, travel and tourism could
    adversely impact our business.
In the retail fuel and convenience store industry, customer
traffic is generally driven by consumer preferences and spending
trends, growth rates for automobile and truck traffic and trends
in travel and tourism. Changes in economic conditions generally
or in the southeastern United States, where substantially all of
our stores are located, could adversely affect discretionary
consumer spending patterns and travel and tourism in our
markets. A decline in the number of visitors to our markets,
changes in consumer preferences or changes in discretionary
consumer spending could have a material adverse effect on our
business, financial condition and results of operations.
Future tobacco legislation, campaigns to discourage
    smoking, increases in tobacco taxes and wholesale cost increases
    of tobacco products could adversely impact our tobacco product
    sales.
Sales of tobacco products accounted for approximately 10% and
12% of net sales of our retail segment for the nine months ended
September 30, 2005 and the year ended December 31,
2004, respectively. Significant increases in wholesale cigarette
costs, increased taxes on tobacco products, declines in the
percentage of smokers in the general population, additional
legal restrictions on smoking in public or private
establishments, future legislation and national and local
campaigns to discourage smoking in the United States that have
an adverse effect on the demand for tobacco products could have
a material adverse effect on our business, financial condition
and results of operations.
Competitive pressures in our markets can make it difficult to
pass price increases on to our customers. This could materially
and adversely affect our retail price of cigarettes, cigarette
unit volume and net sales, merchandise gross profit and overall
customer traffic. Because we derive a significant percentage of
our net sales from tobacco products, a decline in net sales from
the sale of tobacco products or decrease in margins on our
tobacco product sales could have a material adverse effect on
our business, financial condition and results of operations.
Terrorist attacks, threats of war or actual war may
    negatively affect our business.
Terrorist attacks in the United States and the war with Iraq, as
well as events occurring in response or similar to or in
connection with them, may harm our business. Energy-related
assets (which could include refineries, pipelines and terminals
such as ours) may be at greater risk of future terrorist attacks
than other possible targets in the United States. In addition,
the State of Israel, where our parent company, Delek Group Ltd.,
is based, has suffered armed conflicts and political instability
in recent years. We may be more susceptible to terrorist attack
as a result of our connection to an Israeli owner. Since all of
our directors other than Mr. Yemin reside in Israel, our
business may be harmed if armed conflicts or political
instability in Israel cause one or more of our directors to
become unavailable to serve on our board of directors.
A direct attack on our assets or the assets of others used by us
could have a material adverse effect on our business, financial
condition and results of operations. In addition, any terrorist
attack could have an adverse impact on energy prices, including
prices for our crude oil, other feedstocks and refined petroleum
products, and an adverse impact on the margins from our refining
and petroleum product marketing operations. In addition,
disruption or significant increases in energy prices could
result in government-imposed price controls.
15
Table of Contents
Risks Relating to Our Business
We depend upon the economic health of the southeastern
    United States.
Substantially all of our stores are located in the southeastern
United States. As a result, our results of operations are
subject to general economic conditions in that region. An
economic downturn in the Southeast could have a material adverse
effect on our business, financial condition and results of
operations.
We may not be able to successfully execute our strategy of
    growth through acquisitions.
A significant part of our growth strategy is to acquire assets
such as our refinery, pipeline and terminals, and our retail
fuel and convenience stores that complement our existing sites
or broaden our geographic presence, and if attractive
opportunities arise, assets in complementary new lines of
business. From our inception in 2001 through December 15,
2005, we acquired our refinery, 349 retail fuel and convenience
stores and our wholesale fuel distribution operation, in five
major transactions and several smaller transactions. We expect
to continue to acquire retail fuel and convenience stores as a
major element of our growth strategy.
Acquisitions involve risks that could cause our actual growth or
operating results to differ adversely compared with our
expectations or the expectations of securities analysts. For
example:
•
We may not be able to identify suitable acquisition candidates
    or acquire additional assets complementary to our refinery,
    pipelines and terminals, additional retail fuel and convenience
    stores, or assets in new lines of business on favorable terms,
    if at all. We compete with others to acquire any of these
    assets. This competition may increase and could result in
    decreased availability or increased prices for suitable
    acquisition candidates. We may experience difficulty in
    anticipating the timing and availability of acquisition
    candidates.
•
Since the convenience store industry is dominated by small,
    "independent" operators that own fewer than ten
    stores, we will likely need to complete numerous small
    acquisitions, rather than a few major acquisitions, to
    substantially increase our number of retail fuel and convenience
    stores. The need to complete numerous acquisitions will require
    significant amounts of our management's time.
•
We may not be able to obtain the necessary financing, on
    favorable terms or at all, to finance any of our potential
    acquisitions.
•
During the acquisition process, we may fail or be unable to
    discover some of the liabilities of companies or businesses that
    we acquire. These liabilities may result from a prior
    owner's noncompliance with applicable federal, state or
    local laws.
•
We may assume contracts or other obligations in connection with
    particular acquisitions on terms that are less favorable or
    desirable than the terms that we would expect to obtain if we
    negotiated the contracts or other obligations directly.
•
We may fail to successfully integrate or manage acquired
    refinery, pipeline and terminal assets, our retail fuel and
    convenience stores, or other assets.
•
Acquired retail fuel and convenience stores or other assets may
    not perform as we expect or we may not be able to obtain the
    cost savings and financial improvements we anticipate.
•
We may fail to grow our existing systems, financial controls,
    information systems, management resources and human resources in
    a manner that effectively supports our growth.
•
To the extent that we acquire assets in complementary new lines
    of business, we may become subject to additional regulatory
    requirements and additional risks that are characteristic or
    typical of these new lines of business.
Any failure or inability on our part to complete and integrate
future acquisitions successfully could have a material adverse
effect on our business, financial condition and results of
operations.
16
Table of Contents
We are relatively new to the refining business and may
    enter new lines of business in which we are
    inexperienced.
In April 2005, we acquired the Tyler refinery, our pipeline and
other refining, product terminal and crude oil pipeline assets
located in Tyler, Texas from companies affiliated with Crown
Central Petroleum, LLC. Prior to this acquisition, we were not
involved in refining operations. As a result of our recent entry
into the refining business, we may not be able to successfully
enter into advantageous business relationships with other
refinery, pipeline or terminal operators, or wholesale marketers
comparable to those which more established refiners may be able
to enter. Therefore, we may be unable to take full advantage of
business opportunities for the refining business and we may
encounter difficulties in meeting our expectations or the
expectations of investors and securities analysts for the
operating results of the refining business.
We continually evaluate strategic opportunities for growth,
which may include opportunities in new lines of business, in
which we currently have no operations and lack experience. Our
ability to succeed in any new line of business will depend upon
our ability to address and overcome limitations in our
experience.
The results of operations reflected in the historical
    financial statements of our refinery included in this prospectus
    may not be representative of the results of operations that will
    be achieved for the refinery as an integrated unit of our
    company.
We acquired the Tyler refinery from companies affiliated with
Crown Central Petroleum, LLC in April 2005. The historical
financial statements of the refinery for 2002, 2003, 2004 and
2005, therefore, reflect accounting and financial assumptions
and allocations made by Crown and the results of operations of
the refinery as a fully integrated business of Crown. The
accounting and financial assumptions and allocations that we
make with respect to subsequent accounting periods may differ
from those made by Crown. In addition, the performance of the
refinery as an integrated part of our operations will differ
from the performance of the refinery as an integrated part of
Crown's operations. The results of operations of the
refinery reflected in its 2002, 2003, 2004 and 2005 historical
financial statements are, therefore, not necessarily indicative
of the results of operations that may be achieved by us in
subsequent periods, and the results of operations in subsequent
periods may be materially different from the results reflected
in the historical financial statements of the refinery.
We may incur significant costs and liabilities with
    respect to investigation and remediation of existing
    environmental conditions at our refinery.
Prior to our purchase of the refinery and pipeline, the previous
owner had been engaged for many years in the investigation and
remediation of liquid hydrocarbons which contaminated soil and
groundwater at the purchased facilities. Upon purchase of the
facilities, we became responsible and liable for certain costs
associated with the continued investigation and remediation of
known and unknown impacted areas at the refinery. In the future,
it may be necessary to conduct further assessments and
remediation efforts at the refinery and pipeline locations. In
addition, we have identified and self-reported certain other
environmental matters subsequent to our purchase of the
refinery. Based upon environmental evaluations performed by
third parties subsequent to our purchase of the Tyler refinery,
we recorded an environmental liability of approximately
$7.9 million at the acquisition date for the estimated
costs of environmental remediation for our refinery and crude
oil pipeline. We expect remediation of soil and groundwater at
the refinery to continue for the foreseeable future. The need to
make future expenditures for these purposes that exceed the
amounts we estimate and accrue for could have a material adverse
affect on our business, financial condition and results of
operations.
We may incur significant costs and liabilities in
    connection with new environmental regulations and prior
    non-compliance with air emission regulations.
We anticipate that compliance with new regulations, lowering the
permitted level of sulfur in gasoline and highway diesel fuel,
will require us to spend approximately $26.7 million in
capital costs between 2006 and the end of 2007. In addition, as
part of a national initiative, the EPA inspected the Tyler
refinery in 2003
17
Table of Contents
and alleged that the prior owner did not comply with certain air
emission regulations. A settlement with the EPA could result in
required capital expenditures and potential penalties. We
currently estimate that these settlement costs and additional
capital expenditures to comply with the requirements of the EPA
will be approximately $13.3 million from 2005 to the end of
2007. The need to make future expenditures for these purposes
that exceed the amounts we estimated for them could have a
material adverse effect on our business, financial condition and
results of operations.
Our refinery concentrates on processing light sweet crude
    oils.
Our refinery only processes light sweet crude oils efficiently.
Due to increasing demand for lower sulfur fuels, light sweet
crude oils are more costly and less readily available to us than
heavy sour crude oils. An inability to obtain an adequate supply
of light sweet crude oils to operate our refinery at full
capacity or an increase in the cost of light sweet crude oils
could have a material adverse effect on our business, financial
condition and results of operations.
The dangers inherent in our refining operations could
    cause disruptions and expose us to potentially significant costs
    and liabilities. We are particularly vulnerable to disruptions
    in our refining operations because all of our refining
    operations are conducted at a single facility.
Our refining operations are subject to significant hazards and
risks inherent in refining operations and in transporting and
storing crude oil, intermediate and refined petroleum products.
These hazards and risks include, but are not limited to, natural
disasters, fires, explosions, pipeline ruptures and spills,
third party interference and mechanical failure of equipment at
our or third-party facilities, and other events beyond our
control, any of which could result in production and
distribution difficulties and disruptions, environmental
pollution, personal injury or wrongful death claims and other
damage to our properties and the properties of others.
Because all of our refining operations are conducted at a single
refinery, any of such events at our refinery could significantly
disrupt our storage, production and distribution of crude and
refined petroleum products and could have a material adverse
effect on our business, financial condition and results of
operations.
We are subject to interruptions in supply and delivery as
    a result of our reliance on pipelines for transportation of
    crude oil and refined petroleum products.
Our refinery receives substantially all of its crude oil through
pipelines. We could experience an interruption of supply and
delivery, or an increased cost of receiving crude oil, if the
ability of these pipelines to transport crude oil is disrupted
because of accidents, governmental regulation, terrorism, other
third-party action or other events beyond our control. The
unavailability for our use for a prolonged period of time of any
of the pipelines that are used to transport crude oil to our
refinery or refined petroleum products from our refinery could
have a material adverse effect on our business, financial
condition and results of operations.
Our existing inbound pipeline capacity will be
    insufficient to support materially increased production from our
    refinery.
We rely on our pipeline and a leased pipeline to transport crude
oil to our refinery. Due to the capacity limitations, we may be
unable to draw sufficient crude oil from the inbound pipelines
to support increases in our refining output. If we wish to
materially increase our refining output, we will need to upgrade
or supplement the inbound pipelines, which would require us to
make substantial additional capital expenditures.
Our refinery is not equipped with an outbound pipeline for
    distribution of our refined petroleum products to our
    customers.
Over 92% of our refinery sales are completed through a rack
system located at our refinery. Unlike other refiners, we do not
own, and have limited access to, an outbound pipeline for
distribution of our
18
Table of Contents
refinery products to our customers. Our lack of an outbound
pipeline may undermine our ability to attract new customers for
our refined petroleum products or increase sales of our refinery
products.
Our refinery's niche position may be vulnerable to
    competitive pressure.
Our Tyler refinery is the only supplier of a full range of
refined petroleum products within a radius of approximately
115 miles of its location. If a refined petroleum products
delivery pipeline is built in or around the Tyler, Texas area,
we could lose our niche market advantage, which could have a
material adverse effect on our business, financial condition and
results of operations.
If the price of crude oil increases significantly, it
    could limit our ability to purchase enough crude oil to operate
    our refinery at full capacity.
We rely in part on our ability to borrow to collateralize or
purchase crude oil for our refinery. If the price of crude oil
increases significantly, we may not have sufficient borrowing
capacity, and may not be able to sufficiently increase borrowing
capacity, under our existing credit facilities to purchase
enough crude oil to operate our refinery at full capacity. Our
failure to operate our refinery at full capacity could have a
material adverse effect on our business, financial condition and
results of operations.
Our debt levels may limit our flexibility in obtaining
    additional financing and in pursuing other business
    opportunities.
We have a significant amount of debt. As of December 31,
2005, we had total consolidated debt, including capital lease
obligations, of $268.8 million. In addition to our
outstanding debt, as of December 31, 2005, our borrowing
availability under our credit facilities was $79.2 million.
Our significant level of debt could have important consequences
for us. For example, it could:
•
increase our vulnerability to general adverse economic and
    industry conditions;
•
require us to dedicate a substantial portion of our cash flow
    from operations to service our debt and lease obligations,
    thereby reducing the availability of our cash flow to fund
    working capital, capital expenditures and other general
    corporate purposes;
•
limit our flexibility in planning for, or reacting to, changes
    in our business and the industry in which we operate;
•
place us at a disadvantage relative to our competitors that have
    less indebtedness or better access to capital by, for example,
    limiting our ability to enter into new markets, renovate our
    stores or pursue acquisitions or other business opportunities;
•
limit our ability to borrow additional funds in the
    future; and
•
increase the interest cost of our borrowed funds.
In addition, a substantial portion of our debt has a variable
rate of interest, which increases our vulnerability to interest
rate fluctuations.
If we are unable to meet our debt (principal and interest) and
lease obligations, we could be forced to restructure or
refinance our obligations, seek additional equity financing or
sell assets, which we may not be able to do on satisfactory
terms or at all. Our default on any of those obligations could
have a material adverse effect on our business, financial
condition and results of operations. In addition, if new debt is
added to our current debt levels, the related risks that we now
face would intensify.
Our subsidiaries' debt agreements contain operating
    and financial restrictions that might constrain our business and
    financing activities.
The operating and financial restrictions and covenants in our
subsidiaries' credit facilities and any future financing
agreements could adversely affect our ability to finance future
operations or capital needs or to
19
Table of Contents
engage, expand or pursue our business activities. For example,
to varying degrees our credit facilities restrict our
subsidiaries' ability to:
•
declare dividends and redeem or repurchase capital stock;
•
prepay, redeem or repurchase debt;
•
make loans and investments;
•
incur additional indebtedness or amend our debt and other
    material agreements;
•
make capital expenditures;
•
engage in mergers, acquisitions and asset sales; and
•
enter into some intercompany arrangements and make some
    intercompany payments, which in some instances could restrict
    our ability to use the assets, cash flow or earnings of one
    segment to support the other segment.
Other restrictive covenants require that we meet fixed charge
coverage, interest charge coverage and leverage tests as
described in the credit facility agreements. Our ability to
comply with the covenants and restrictions contained in our debt
instruments may be affected by events beyond our control,
including prevailing economic, financial and industry
conditions. If market or other economic conditions deteriorate,
our ability to comply with these covenants and restrictions may
be impaired. If we breach any of the restrictions or covenants
in our debt agreements, a significant portion of our
indebtedness may become immediately due and payable, and our
lenders' commitments to make further loans to us may
terminate. We might not have, or be able to obtain, sufficient
funds to make these immediate payments. In addition, our
obligations under our credit facilities are secured by
substantially all of our assets. If we are unable to repay our
indebtedness under our credit facilities when due, the lenders
could seek to foreclose on the assets. Any of these outcomes
could have a material adverse effect on our business, financial
condition and results of operations.
We rely on our parent company and an affiliate for
    guarantees and letters of credit.
Since our inception, from time to time our parent company, Delek
Group Ltd. and/ or our affiliate Delek – The Israel
Fuel Corporation Ltd., have guaranteed our crude oil purchases,
forward contract exposure and some of our indebtedness, and have
issued letters of credit for fuel purchases. See "Certain
Relationships and Related Transactions — Guarantees by
Affiliates." We cannot assure you that these entities will
continue to furnish guarantees or issue letters of credit for
our benefit. If these entities do not continue to provide some
or all of these guarantees or issue letters of credit, we cannot
assure you that we could replace them on the same or equally
favorable terms, if at all, which could have a material adverse
effect on our business, financial condition and results of
operations.
We may seek to grow by opening new retail fuel and
    convenience stores in new geographic areas.
Since our inception, we have grown primarily by acquiring retail
fuel and convenience stores in the southeastern United States.
We may seek to grow by selectively pursuing acquisitions or by
opening new retail fuel and convenience stores in geographic
areas of the United States in which we currently have little or
no presence. This growth strategy would present numerous
operational and competitive challenges to our senior management
and employees and would place significant pressure on our
operating systems. In addition, we cannot assure you that
consumers located in the regions in which we may expand our
retail fuel and convenience store operations would be as
receptive to our retail fuel and convenience stores as consumers
in our existing markets. The achievement of our expansion plans
will depend in part upon our ability to:
•
select, and compete successfully in, new markets;
•
obtain suitable sites at acceptable costs;
•
realize an acceptable return on the cost of capital invested in
    new facilities;
20
Table of Contents
•
hire, train, and retain qualified personnel;
•
integrate new retail fuel and convenience stores into our
    existing distribution, inventory control, and information
    systems;
•
expand relationships with our suppliers or develop relationships
    with new suppliers; and
•
secure adequate financing, to the extent required.
We may incur significant
start-up
costs in
connection with entering new markets, including costs related to
complying with local regulations. We cannot assure you that we
will achieve our expansion goals, manage our growth effectively,
or operate our existing and new retail fuel and convenience
stores profitability. The failure to achieve any of the
foregoing could have a material adverse effect on our business,
financial condition and results of operations.
Adverse weather conditions or other unforeseen
    developments in the Southeast could negatively affect our
    business.
The Southeast is susceptible to severe storms including
hurricanes, thunderstorms, extended periods of rain, ice storms
and snow, all of which we have experienced in the past few
years. Inclement weather conditions, as well as severe storms in
the Southeast, such as Hurricanes Katrina and Rita, could damage
our facilities, have a significant adverse impact on consumer
behavior, travel and retail fuel and convenience store traffic
patterns or impede our ability to operate our locations, or if
such conditions prevail in Texas, could undermine our ability to
produce and transport products from our refinery. Regional
occurrences in the Southeast, such as energy shortages or
increases in energy prices, fires and other natural disasters,
could also hurt our business. The occurrence of any of these
developments could have a material adverse effect on our
business, financial condition and results of operations.
Our operating results are seasonal and generally lower in
    the first and fourth quarters of the year for our refining
    segment and in the first quarter of the year for our retail
    segment. We depend on favorable weather conditions in the spring
    and summer months.
Demand for gasoline and other merchandise is generally higher
during the summer months than during the winter months due to
seasonal increases in highway traffic. As a result, the
operating results of our refining segment are generally lower
for the first and fourth quarters of each year. Seasonal
fluctuations in highway traffic also affect sales of motor fuels
and merchandise in our retail fuel and convenience stores. As a
result, the operating results of our retail segment are
generally lower for the first quarter of the year.
Weather conditions in our operating area also have a significant
effect on our operating results. Customers are more likely to
purchase higher profit margin items at our retail fuel and
convenience stores, such as fast foods, fountain drinks and
other beverages, and more gasoline during the spring and summer
months in the Southeast, thereby typically generating higher
revenues and gross margins for us in these periods. Unfavorable
weather conditions during these months and a resulting lack of
the expected seasonal upswings in highway traffic and sales
could have a material adverse effect on our business, financial
condition and results of operations.
We depend on one supplier for a significant portion of our
    retail fuel supply.
We purchased approximately 53% of our fuel for our retail fuel
and convenience stores for the nine months ended
September 30, 2005 from a single supplier, Valero Marketing
and Supply. Our contract with Valero expires in 2008 and
provides us with discounts that may not be available to us from
other suppliers. We cannot assure you that we will be able to
renew our contract with Valero on terms that are satisfactory to
us, if at all, or that we would be able to secure equally
favorable terms from another supplier. A change of fuel
supplier, a disruption in supply or a significant change in our
relationship with this fuel supplier could lead to an increase
in our fuel costs and could have a material adverse effect on
our business, financial condition and results of operations.
21
Table of Contents
We depend on one wholesaler for a significant portion of
    our convenience store merchandise.
We purchased approximately 45% of our merchandise, including
most tobacco products and grocery items for the nine months
ended September 30, 2005 from a single wholesale grocer,
McLane Company, Inc., a wholly-owned subsidiary of Berkshire
Hathaway Inc. A change of merchandise suppliers, a disruption in
supply or a significant change in our relationship with our
principal merchandise supplier could lead to an increase in our
cost of goods or a reduction in the reliability of timely
deliveries and could have a material adverse effect on our
business, financial condition and results of operations.
In addition, we believe that our arrangements with vendors,
including McLane, with respect to allowances, payment terms and
operational support commitments, have enabled us to decrease the
operating expenses of convenience stores that we acquire. If we
are unable to maintain favorable arrangements with these
vendors, we may be unable to continue to effect operating
expense reductions at convenience stores we have acquired or
will acquire.
If we fail to develop, integrate or upgrade our
    information technology systems, we may incur costs beyond our
    expectations.
Increasingly, we depend upon the flexibility and sophistication
of our technologies supporting our operations. The failure of
hardware or software that supports our information technology
systems or the loss of data contained in the systems could
significantly disrupt our operations. If our information
technology systems are unable to handle additional volume for
our operations as our business and scope of service grow, our
service levels and operating efficiency will decline. Our
failure to upgrade, replace or otherwise modify these systems to
support our business, including to handle increased volumes of
information and protect against disruptions of our operations or
our failure to hire and retain qualified personnel to implement
and maintain our information technology systems could have a
material adverse effect on our business, financial condition and
results of operations. In particular, our sales platform
software is proprietary and therefore requires original
programming by qualified consultants to upgrade and maintain its
functionality.
To compete effectively, we must anticipate and adapt to
technology changes. We may choose new technologies that later
prove to be inadequate, or may be forced to implement new
technologies, at substantial cost, to remain competitive. In
addition, competitors may implement new technologies before we
do, allowing these competitors to provide lower priced, enhanced
or superior quality services compared to the services we
currently provide.
Our insurance policies do not cover all losses, costs or
    liabilities that we may experience, and insurance companies that
    currently insure companies in the energy industry may cease to
    do so or substantially increase premiums.
We maintain significant insurance coverage, including property
insurance capped at $450.0 million for our refinery and at
approximately $268.0 million for our retail fuel and
convenience stores. However, our insurance coverage does not
cover all potential losses, costs or liabilities, and our
business interruption insurance coverage does not apply unless a
business interruption exceeds 45 days. We could suffer
losses for uninsurable or uninsured risks or in amounts in
excess of our existing insurance coverage.
The energy industry is highly capital intensive, and the entire
or partial loss of individual facilities can result in
significant costs to both industry participants, such as us, and
their insurance carriers. In recent years, several large energy
industry claims have resulted in significant increases in the
level of premium costs and deductible periods for participants
in the energy industry. For example, during 2005, Hurricanes
Katrina and Rita caused significant damage to several petroleum
refineries along the Gulf Coast, in addition to numerous oil and
gas production facilities and pipelines in that region. As a
result of large energy industry claims, insurance companies that
have historically participated in underwriting energy-related
facilities may discontinue that practice, or demand
significantly higher premiums or deductible periods to cover
these facilities. If significant changes in the number or
financial solvency of insurance underwriters for the energy
industry occur, or if other adverse conditions over which we
have no control prevail in the insurance market, we may be
unable to obtain and maintain adequate insurance at reasonable
cost.
22
Table of Contents
In addition, we cannot assure you that our insurers will renew
our insurance coverage on acceptable terms, if at all, or that
we will be able to arrange for adequate alternative coverage in
the event of non-renewal. The unavailability of full insurance
coverage to cover events in which we suffer significant losses
could have a material adverse effect on our business, financial
condition and results of operations.
If we lose any of our key personnel, our ability to manage
    our business and continue our growth could be negatively
    impacted.
Our future performance depends to a significant degree upon the
continued contributions of our senior management team and key
technical personnel. We do not currently maintain key man life
insurance with respect to any member of our senior management
team. In addition, no member of our senior management other than
our chief executive officer/president has entered into an
employment agreement with us. To the extent that the services of
members of our senior management team and key technical
personnel would be unavailable to us for any reason, we would be
required to hire other personnel to manage and operate our
company. We cannot assure you that we would be able to locate or
employ such qualified personnel on satisfactory terms, if at
all, which could have a material adverse effect on our business,
financial condition and results of operations.
A substantial portion of our refinery workforce is
    unionized, and we may face labor disruptions that would
    interfere with our operations.
As of September 30, 2005, we employed 223 people at our
Tyler refinery and pipeline and have collective bargaining
agreements covering 149 of our operations and maintenance hourly
employees and ten of our refinery's truck drivers, which
agreements expire on January 1, 2009 and January 31,
2009, respectively. Although these collective bargaining
agreements contain provisions to discourage strikes or work
stoppages, we cannot assure you that strikes or work stoppages
will not occur. A strike or work stoppage could have a material
adverse effect on our business, financial condition and results
of operations.
We are dependent on gasoline sales at our retail fuel and
    convenience stores which makes us susceptible to increases in
    the cost of gasoline and interruptions in fuel supply.
Fuel sales represented approximately 72% and 70% of our net
sales of our retail segment for the nine months ended
September 30, 2005 and the year ended December 31,
2004, respectively. Our dependence on fuel sales makes us
susceptible to increases in the cost of gasoline. As a result,
fuel profit margins have a significant impact on our earnings.
The volume of fuel sold by us and our fuel profit margins are
affected by numerous factors beyond our control, including the
supply and demand for fuel, volatility in the wholesale fuel
market and the pricing policies of competitors in local markets.
Although we can rapidly adjust our pump prices to reflect higher
fuel costs, a material increase in the price of fuel could
adversely affect demand. A material, sudden increase in the cost
of fuel that causes our fuel sales to decline could have a
material adverse effect on our business, financial condition and
results of operations.
Our dependence on gasoline sales makes us susceptible to
interruptions in fuel supply. We typically have no more than a
five-day supply of fuel at each of our retail fuel and
convenience stores. Our fuel contracts do not guarantee an
uninterrupted, unlimited supply in the event of a shortage. In
addition, gasoline sales generate customer traffic to our retail
fuel and convenience stores. As a result, decreases in gasoline
sales, in the event of a shortage or otherwise, could adversely
affect our merchandise sales. A serious interruption in the
supply of gasoline could have a material adverse effect on our
business, financial condition and results of operations.
We may incur losses as a result of our forward contract
    activities and derivative transactions.
We occasionally use derivative financial instruments, such as
interest rate swaps and interest rate cap agreements, and fuel
related derivative transactions, and we expect to continue to
enter into these types of transactions. We cannot assure you
that the strategies underlying these transactions will be
successful. If any of the instruments we utilize to hedge our
exposure to various types of risk are not effective, we may incur
23
Table of Contents
losses. We incurred a loss of $10.9 million in 2005 in
connection with our forward contract activities. See
"Management's Discussion and Analysis of Financial
Condition and Results of Operations."
If we violate state laws regulating our sale of tobacco
    and alcohol products, or if these laws are changed, our results
    of operations will suffer.
We sell tobacco products in all of our stores and alcohol
products in approximately 85% of our stores. Our net sales from
the sale of tobacco and alcohol products were
$121.4 million and $144.6 million for the nine months
ended September 30, 2005 and the year ended
December 31, 2004, respectively. State laws regulate our
sale of tobacco and alcohol products. For example, state and
local regulatory agencies have the power to approve, revoke,
suspend or deny applications for, and renewals of, permits and
licenses relating to the sale of these products or to seek other
remedies. Certain states regulate relationships, including
overlapping ownership, among alcohol manufacturers, wholesalers
and retailers and may deny or revoke licensure if relationships
in violation of the state laws exist. In addition, certain
states have adopted or are considering adopting "warm beer
laws" that seek to discourage drunk driving by prohibiting
the sale of refrigerated beer. Our violation of state laws
regulating our sale of tobacco and alcohol products or a change
in these laws, such as the adoption of a "warm beer
laws" in one or more of the states we operate, could have a
material adverse effect on our business, financial condition and
results of operations.
If we fail to meet our obligations under our long-term
    branded gasoline supply agreement with BP, we may incur
    penalties and/or the agreement may be terminated.
In December 2005, we entered into a branded gasoline jobber
supply agreement with BP, to purchase a portion of our gasoline
products for a minimum of 15 years. The agreement requires
us to purchase specified minimum quantities of branded gasoline
products annually, which quantities escalate on a yearly basis.
We estimate that for the year ending December 31, 2006, BP
will supply approximately 12.5% of our total gasoline volume. If
we fail to purchase the applicable annual minimum quantities, BP
may terminate the agreement and we could be required to pay BP
damages equal to the difference between the specified
contractual minimum annual gallons of gasoline products and the
amount actually purchased by us, multiplied by a specified per
gallon amount. The termination of the agreement by BP and the
imposition of damages could have a material adverse effect on
our business, financial condition and results of operations.
If we are unable to continue using the BP, Exxon, Shell,
    or Chevron brand names or if there is negative publicity
    concerning any of these major oil companies, sales at certain of
    our stores may suffer.
We operate approximately 23% of our retail fuel and convenience
stores under the BP, Exxon, Shell and Chevron brand names. If
these stores lose the right to use these brand names (and
accompanying brand advertising), or if there is negative
publicity concerning any of these major oil companies, we could
suffer a decline in sales at these stores.
It may be difficult to serve process on or enforce a
    United States judgment against almost all of our
    directors.
All of our directors named in this prospectus, other than
Mr. Yemin, reside in the State of Israel. In addition, a
substantial portion of the assets of these directors are located
outside of the United States. As a result, you may have
difficulty serving legal process within the United States upon
any of these persons. You may also have difficulty enforcing,
both in and outside the United States, judgments you may obtain
in United States courts against these persons in any action,
including actions based upon the civil liability provisions of
United States federal or state securities laws. Furthermore,
there is substantial doubt that the courts of the State of
Israel would enter judgments in original actions brought in
those courts predicated on U.S. federal or state securities
laws.
24
Table of Contents
If we are, or become, a U.S. real property holding
    corporation, special tax rules may apply to a sale, exchange or
    other disposition of common stock and
non-U.S.
holders
    may be less inclined to invest in our stock as they may be
    subject to U.S. federal income tax in certain
    situations.
A
non-U.S.
holder
will be subject to U.S. federal income tax with respect to
gain recognized on the sale, exchange or other disposition of
common stock if we are, or were, a "U.S. real property
holding corporation," or a USRPHC, at any time during the
shorter of the five-year period ending on the date of the sale
or other disposition and the period such
non-U.S.
holder
held our common stock (the shorter period referred to as the
"lookback period"). In general, we would be a USRPHC
if interests in U.S. real estate comprised most of our
assets. Because of the real property and retail fuel and
convenience stores we own, we may be, or may become, a USRPHC.
If we are or become a USRPHC, so long as our common stock is
regularly traded on an established securities market (such as
the NYSE), only a
non-U.S.
holder
who, actually or constructively, holds or held during the
lookback period more than 5% of our common stock will be subject
to U.S. federal income tax on the disposition of our common
stock.
Risks Related to Our Common Stock and this Offering
There is no existing market for our common stock, and a
    trading market that will provide you with adequate liquidity may
    not develop. The price of our common stock may fluctuate
    significantly, and you could lose all or part of your
    investment.
Prior to this offering, there has been no public market for our
common stock. We cannot predict the extent to which investor
interest will lead to the development of an active and liquid
trading market in our common stock on the NYSE or otherwise. If
an active trading market does not develop, you may have
difficulty selling any of our common stock that you buy.
The initial public offering price for the shares will be
determined by negotiations between us and the representatives of
the underwriters and may not be indicative of the market price
of the common stock that will prevail in the trading market. The
market price of our common stock may decline below the initial
public offering price. The market price of our common stock may
also be influenced by many factors, some of which are beyond our
control, including:
•
our quarterly or annual earnings or those of other companies in
    our industry;
•
announcements by us or our competitors of significant contracts
    or acquisitions;
•
changes in accounting standards, policies, guidance,
    interpretations or principles;
•
general economic and stock market conditions;
•
the failure of securities analysts to cover our common stock
    after this offering or changes in financial estimates by
    analysts;
•
future sales of our common stock; and
•
the other factors described in these "Risk Factors."
In recent years, the stock market has experienced extreme price
and volume fluctuations. This volatility has had a significant
impact on the market price of securities issued by many
companies, including companies in our industry. The changes
frequently appear to occur without regard to the operating
performance of these companies. The price of our common stock
could fluctuate based upon factors that have little or nothing
to do with our company, and these fluctuations could materially
reduce our stock price.
In the past, some companies that have had volatile market prices
for their securities have been subject to securities class
action suits filed against them. The filing of a lawsuit against
us, regardless of the outcome, could have a material adverse
effect on our business, financial condition and results of
operations, as it could result in substantial legal costs and a
diversion of our management's attention and resources.
25
Table of Contents
You will suffer immediate and substantial dilution.
The initial public offering price of our common stock is
substantially higher than the net tangible book value per share
of our outstanding common stock. As a result, you will pay a
price per share that substantially exceeds the tangible book
value of our assets after subtracting liabilities. You will
incur immediate and substantial dilution of
$           per
share. You will suffer additional dilution if stock, restricted
stock units, restricted stock, stock options, warrants or other
equity awards, whether currently outstanding or subsequently
granted, are exercised, including the stock options and
restricted stock units described under
"Management — IPO Awards. See
"Dilution."
We are a "controlled company" within the meaning
    of the NYSE rules and, as a result, will qualify for, and intend
    to rely on, exemptions from certain corporate governance
    requirements.
A company of which more than 50% of the voting power is held by
an individual, a group or another company is a "controlled
company" and may elect not to comply with certain corporate
governance requirements of the NYSE, including:
•
the requirement that a majority of our board of directors
    consist of independent directors;
•
the requirement that we have a nominating/corporate governance
    committee consisting entirely of independent directors with a
    written charter addressing the committee's purpose and
    responsibilities; and
•
the requirement that we have a compensation committee consisting
    entirely of independent directors with a written charter
    addressing the committee's purpose and responsibilities.
Following this offering, we intend to utilize some or all of
these exemptions. Accordingly, you will not have the same
protections afforded to stockholders of companies that are
subject to all of the corporate governance requirements of the
NYSE.
Our controlling stockholder, Delek Group Ltd., may have
    conflicts of interest with other stockholders in the
    future.
Delek Group Ltd. currently owns indirectly all of our
outstanding common stock. After this offering, Delek Group Ltd.
will own indirectly
approximately           %
of our outstanding common stock, or
approximately      % if the
underwriters exercise their purchase option in full. As a
result, Delek Group Ltd. and its controlling shareholder,
Mr. Yitzchak Sharon Teshuva, an Israeli citizen, will
continue to be able to control the election of our directors,
determine our corporate and management policies and determine,
without the consent of our other stockholders, the outcome of
any corporate transaction or other matter submitted to our
stockholders for approval, including potential mergers or
acquisitions, asset sales and other significant corporate
transactions. So long as Delek Group Ltd. continues to own a
significant amount of the outstanding shares of our common
stock, Delek Group Ltd. will continue to be able to strongly
influence or effectively control our decisions, including
whether to pursue or consummate potential mergers or
acquisitions, asset sales and other significant corporate
transactions. We cannot assure you that the interests of Delek
Group Ltd. will coincide with the interests of other holders of
our common stock.
Future sales of our common stock by our controlling
    stockholder, Delek Group Ltd., could depress the price of our
    common stock.
The market price of our common stock could decline as a result
of sales of a large number of shares of our common stock in the
market after this offering or the perception that these sales
could occur. These sales, or the possibility that these sales
may occur, also might make it more difficult for us to sell
equity securities in the future at a time and at a price that we
deem appropriate. Upon completion of this offering, we will
have  shares of common stock outstanding. Delek Group Ltd.,
our controlling stockholder, is subject to an agreement with the
underwriters that restricts its ability to transfer shares of
our common stock for 180 days after the date of this
prospectus. The representatives of the underwriters may, in
their sole discretion and at any time, waive the restrictions on
transfer in this agreement during this period. After this
agreement
26
Table of Contents
expires,
approximately                of
these shares will be eligible for sale in the public market,
subject to applicable federal securities law restrictions.
We depend upon our subsidiaries for cash to meet our
    obligations and pay any dividends.
We are a holding company. Our subsidiaries conduct substantially
all of our operations and own substantially all of our assets.
Consequently, our cash flow and our ability to meet our
obligations or pay dividends to our stockholders depend upon the
cash flow of our subsidiaries and the payment of funds by our
subsidiaries to us in the form of dividends, tax sharing
payments or otherwise. Our subsidiaries' ability to make
any payments will depend on many factors, including their
earnings, the terms of their indebtedness, tax considerations
and legal restrictions.
We may be unable to pay dividends in the anticipated
    amounts and frequency set forth in this prospectus.
We have never declared or paid any cash dividends on our capital
stock. We will only be able to pay dividends from our available
cash on hand and funds received from our subsidiaries. Our
ability to receive dividends from our subsidiaries is restricted
under the terms of their senior secured credit facilities. The
declaration of future dividends on our common stock will be at
the discretion of our board of directors and will depend upon
many factors, including our results of operations, financial
condition, earnings, capital requirements, restrictions in our
debt agreements and legal requirements. Although we currently
intend to pay quarterly cash dividends on our common stock at an
initial annual rate of
$           per
share
commencing                     ,
we cannot assure you that any dividends will be paid in the
anticipated amounts and frequency set forth in this prospectus,
if at all. Accordingly, if you purchase shares of common stock
in this offering, you may be unable to realize a gain on your
investment unless the price of our common stock appreciates.
We have not determined any specific use for a significant
    portion of the proceeds from this offering and we may use the
    proceeds in ways with which you may not agree.
Our management will have considerable discretion in the
application of the net proceeds received by us. You will not
have the opportunity, as part of your investment decision, to
assess whether the proceeds are being used appropriately. You
must rely on the judgment of our management regarding the
application of the net proceeds of this offering. The net
proceeds may be used for corporate purposes that may not improve
our financial condition and results of operations or increase
our stock price. See "Use of Proceeds."
Provisions of Delaware law and our organizational
    documents may discourage takeovers and business combinations
    that our stockholders may consider in their best interests,
    which could negatively affect our stock price.
In addition to the fact that Delek Group Ltd. will own the
majority of our common stock after this offering, provisions of
Delaware law and our amended and restated certificate of
incorporation and amended and restated bylaws to be in effect
upon completion of this offering may have the effect of delaying
or preventing a change in control of our company or deterring
tender offers for our common stock that other stockholders may
consider in their best interests.
Our certificate of incorporation authorizes us to issue up
to            shares
of preferred stock in one or more different series with terms to
be fixed by our board of directors. Stockholder approval is not
necessary to issue preferred stock in this manner. Issuance of
these shares of preferred stock could have the effect of making
it more difficult and more expensive for a person or group to
acquire control of us, and could effectively be used as an
anti-takeover device. Following the closing of this offering, no
shares of our preferred stock will be outstanding.
Our bylaws provide for an advance notice procedure for
stockholders to nominate director candidates for election or to
bring business before an annual meeting of stockholders,
including proposed nominations of persons for election to our
board of directors, and require that special meetings of
stockholders be called only
27
Table of Contents
by our chairman of the board, president or secretary after
written request of a majority of our board of directors.
The anti-takeover provisions of Delaware law and provisions in
our organizational documents may prevent our stockholders from
receiving the benefit from any premium to the market price of
our common stock offered by a bidder in a takeover context. Even
in the absence of a takeover attempt, the existence of these
provisions may adversely affect the prevailing market price of
our common stock if they are viewed as discouraging takeover
attempts in the future.
Being a public company will increase our administrative
    workload and expenses.
As a public company with common stock listed on the NYSE, we
will need to comply with new laws, regulations and requirements,
including certain provisions of the Sarbanes-Oxley Act of 2002,
related regulations of the Securities and Exchange Commission,
or SEC, and the requirements of the NYSE, with which we are not
required to comply with as a private company. Complying with
these statutes, regulations and requirements will occupy a
significant amount of the time of our board of directors and
management. The hiring of additional personnel to handle these
responsibilities will increase our operating costs. We will need
to:
•
institute a more comprehensive compliance function;
•
design, establish, evaluate and maintain a system of internal
    controls over financial reporting in compliance with the
    requirements of Section 404 of the Sarbanes-Oxley Act of
    2002 and the related rules and regulations of the SEC and the
    Public Company Accounting Oversight Board;
•
prepare and distribute periodic public reports in compliance
    with our obligations under the federal securities laws;
•
involve and retain to a greater degree outside counsel and
    accountants in the above activities; and
•
enhance our investor relations function.
In addition, we expect that being a public company subject to
these rules and regulations will make it more expensive for us
to obtain director and officer liability insurance, and we may
be required to accept reduced coverage or incur substantially
higher costs to obtain coverage. These factors could also make
it more difficult for us to attract and retain qualified members
of our board of directors, particularly to serve on our audit
and compensation committees, and qualified executive officers.
We will be exposed to risks relating to evaluations of
    internal controls required by Section 404 of the
    Sarbanes-Oxley Act of 2002.
We are in the process of evaluating our internal controls
systems to allow management to report on, and our independent
auditors to audit, our internal controls over financial
reporting. We will be performing the system and process
evaluation and testing (and any necessary remediation) required
to comply with the management certification and auditor
attestation requirements of Section 404 of the
Sarbanes-Oxley Act of 2002. We will be required to comply with
Section 404 by no later than December 31, 2007.
However, we cannot be certain as to the timing of completion of
our evaluation, testing and remediation actions or the impact of
the same on our operations.
Furthermore, upon completion of this process, we may identify
control deficiencies of varying degrees of severity under
applicable SEC and Public Company Accounting Oversight Board
rules and regulations that remain unremediated. As a public
company, we will be required to report, among other things,
control deficiencies that constitute a "material
weakness" or changes in internal controls that, or are
reasonably likely to, materially affect internal controls over
financial reporting. A "material weakness" is a
significant deficiency, or combination of significant
deficiencies that results in more than a remote likelihood that
a material misstatement of the annual or interim financial
statements will not be prevented or detected. We are aware that
we will need, and we intend, to hire additional accounting
personnel in order to comply with the rules and regulations that
will apply to us as a public company.
28
Table of Contents
If we fail to implement the requirements of Section 404 in
a timely manner, we might be subject to sanctions or
investigation by regulatory authorities such as the SEC or the
NYSE. Additionally, failure to comply with Section 404 or
the report by us of a material weakness may cause investors to
lose confidence in our financial statements and our stock price
may be adversely affected. If we fail to remedy any material
weakness, our financial statements may be inaccurate, we may
face restricted access to the capital markets, and our stock
price may decline.
29
Table of Contents
CAUTIONARY STATEMENT
REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains "forward-looking statements"
that reflect our current estimates, expectations and projections
about our future results, performance, prospects and
opportunities. Forward-looking statements include, among other
things, the information concerning our possible future results
of operations, business and growth strategies, financing plans,
expectations that regulatory developments or other matters will
not have a material adverse effect on our business or financial
condition, our competitive position and the effects of
competition, the projected growth of the industry in which we
operate, and the benefits and synergies to be obtained from our
completed and any future acquisitions, and statements of
management's goals and objectives, and other similar
expressions concerning matters that are not historical facts.
Words such as "may," "will,"
"should," "could," "would,"
"predicts," "potential,"
"continue," "expects,"
"anticipates," "future,"
"intends," "plans," "believes,"
"estimates," "appears," "projects"
and similar expressions, as well as statements in future tense,
identify forward-looking statements.
Forward-looking statements should not be read as a guarantee of
future performance or results, and will not necessarily be
accurate indications of the times at, or by which, such
performance or results will be achieved. Forward-looking
information is based on information available at the time and/or
management's good faith belief with respect to future
events, and is subject to risks and uncertainties that could
cause actual performance or results to differ materially from
those expressed in the statements. Important factors that could
cause such differences include, but are not limited to:
•
competition;
•
changes in, or the failure to comply with, the extensive
    government regulations applicable to our industry segments;
•
the availability, cost and price volatility of crude oil, other
    refinery feedstocks and refined petroleum products;
•
our ability to integrate acquired businesses and implement our
    growth strategy;
•
general economic and business conditions, particularly levels of
    spending relating to travel and tourism or conditions affecting
    the southeastern United States;
•
dependence on one principal fuel supplier and one wholesaler for
    a significant portion of our convenience store merchandise;
•
operating hazards, natural disasters, casualty losses and other
    matters beyond our control;
•
increases in our debt levels;
•
restrictive covenants in our debt agreements;
•
seasonality;
•
terrorist attacks;
•
potential conflicts of interest between our major stockholder
    and other stockholders;
•
our discretion in the use of net proceeds from this offering; and
•
other factors discussed under the headings "Risk
    Factors," "Management's Discussion and Analysis
    of Financial Condition and Results of Operations" and
    "Business."
In light of these risks, uncertainties and assumptions, our
actual results of operations and execution of our business
strategy could differ materially from those expressed in, or
implied by, the forward-looking statements, and you should not
place undue reliance upon them. In addition, past financial
and/or operating performance is not necessarily a reliable
indicator of future performance and you should not use our
historical performance to anticipate results or future period
trends. We can give no assurances that any of the events
anticipated by the forward-looking statements will occur or, if
any of them do, what impact they will have on our results of
operations and financial condition.
30
Table of Contents
Forward-looking statements speak only as of the date the
statements are made. We assume no obligation to update
forward-looking statements to reflect actual results, changes in
assumptions or changes in other factors affecting
forward-looking information except to the extent required by
applicable securities laws. If we do update one or more
forward-looking statements, no inference should be drawn that we
will make additional updates with respect thereto or with
respect to other forward-looking statements.
All forward-looking statements attributable to us or persons
acting on our behalf are expressly qualified in their entirety
by the cautionary statements included in this prospectus.
31
Table of Contents
USE OF PROCEEDS
We estimate that the net proceeds to us from this offering will
be approximately
$          ,
or approximately
$               if
the underwriters' option to purchase additional shares is
exercised in full, based on an assumed initial public offering
price of
$          ,
the midpoint of the range set forth on the cover page of this
prospectus, and after deducting estimated underwriting discounts
and commissions and estimated offering expenses that are payable
by us in connection with the offering. We expect to use these
net proceeds:
•
to fully repay the $25.0 million outstanding principal,
    plus accrued interest to the date of repayment (which accrued
    interest was approximately $1.5 million on
    December 31, 2005), under the promissory note payable to
    Delek – The Israel Fuel Corporation Ltd., one of our
    affiliates, which bears interest at a rate of 6.3% per year
    and has a maturity date of April 27, 2008;
•
to fully repay the $17.5 million outstanding principal,
    plus accrued interest to the date of repayment (which accrued
    interest was approximately $0.8 million on
    December 31, 2005), under the promissory note payable to
    Delek Group Ltd., our parent company, which bears interest at a
    rate of 7.0% per year and has a maturity date of
    April 27, 2010;
•
to fully repay the $10.0 million outstanding principal,
    plus accrued interest to the date of repayment (which accrued
    interest was approximately $0.6 million on
    December 31, 2005), under the promissory note payable to
    Bank Leumi USA, which bears interest at a spread of
    1.375% per year over the LIBOR Rate (Reserve Adjusted) for
    a three month term (5.625% at December 31, 2005), and has a
    maturity date of April 27, 2007; and
•
for general corporate purposes, including working capital,
    capital expenditures and possible acquisitions.
On April 27, 2005, we signed the promissory note payable to
Delek Group Ltd. described above in an original principal amount
of $35.0 million. The proceeds of this promissory note were
used to partially fund the purchase of our Tyler refinery. On
November 23, 2005, we repaid $17.5 million of the
principal and all accrued interest on this note through the date
of repayment.
On April 27, 2005, we signed the promissory note payable to
Bank Leumi USA described above in an original principal amount
of $20.0 million. The proceeds of this promissory note were
used to partially fund the purchase of our Tyler refinery. On
November 23, 2005, we repaid $10.0 million of the
principal under this note.
Although we continually evaluate acquisition opportunities, we
have not entered into any binding commitments or agreements with
respect to future acquisitions. Pending use of the net proceeds,
we will invest the net proceeds of this offering in
interest-bearing, short-term, investment grade, highly liquid
securities.
DIVIDEND POLICY
We have never declared or paid any cash dividends on our capital
stock. We currently intend to pay quarterly cash dividends on
our common stock at an initial annual rate of
$           per
share
commencing                               .
We will only be able to pay dividends from our available cash on
hand and funds received from our subsidiaries. Our
subsidiaries' ability to make any payments to us will
depend upon many factors, including their earnings, the terms of
their indebtedness, tax considerations and legal restrictions.
Our ability to receive dividends from our subsidiaries is
restricted under the terms of their senior secured credit
facilities. The declaration of future dividends on our common
stock will be at the discretion of our board of directors and
will depend upon many factors, including our results of
operations, financial condition, earnings, capital requirements,
restrictions in our debt agreements and legal requirements. We
cannot assure you that any dividends will be paid in the
anticipated amounts and frequency set forth in this prospectus,
if at all.
32
Table of Contents
CAPITALIZATION
The following table sets forth our consolidated cash and cash
equivalents and capitalization as of September 30, 2005:
•
on an actual basis;
•
as adjusted to give effect to the transactions described in
    footnote (1) below as if such transactions had occurred on
    September 30, 2005; and
•
as further adjusted to reflect our sale
    of       shares of our common
    stock at a price of
    $           per
    share, the midpoint of the range set forth on the cover page of
    this prospectus, and our use of proceeds, net of estimated
    underwriting discounts and commissions and estimated offering
    expenses that are payable by us.
This table should be read in conjunction with our audited
consolidated financial statements, including the notes thereto,
"Use of Proceeds," "Selected Historical
Consolidated Financial Information,"
"Management's Discussion and Analysis of Financial
Condition and Results of Operations" and our unaudited
condensed consolidated financial statements included elsewhere
in this prospectus.
As of September 30, 2005
As Further
Actual
As Adjusted(1)
Adjusted
(Dollars in thousands)
Cash and cash equivalents
$
147,027
$
104,527
$
Long-term debt:
Notes payable to related parties
$60,000
$42,500
$
Senior secured credit facility — term loan
164,588
164,588
164,588
Senior secured credit facility — revolver
8,000
38,000
38,000
Israel Discount Bank note
30,000
20,000
20,000
Bank Leumi USA note
20,000
10,000
Other notes payable
90
90
90
Total long-term debt
282,678
275,178
222,678
Stockholder's equity:
Common stock, $0.01 par value, 3,000 shares
    authorized, 100 shares issued and outstanding,
    actual;    shares
    authorized,    shares issued and outstanding, as
    adjusted(2)
—
—
Additional paid-in capital
41,121
41,121
Retained earnings
54,153
54,153
Total stockholder's equity
95,274
95,274
Total capitalization
$
377,952
$
370,452
$
(1)
Reflects the following prepayments of debt after
    September 30, 2005 as if they had occurred on
    September 30, 2005: the prepayment on November 23,
    2005 of $17.5 million of principal on the
    $35.0 million promissory note, dated April 27, 2005
    payable to Delek Group Ltd.; the prepayment, on
    November 23, 2005, of $10.0 million of principal on
    the $30.0 million promissory note, dated April 26,
    2005 payable to Israel Discount Bank; and the prepayment, on
    November 23, 2005, of $10.0 million of principal on
    the $20.0 million promissory note, dated April 27,
    2005 payable to Bank Leumi USA. Also gives effect to our
    acquisition of retail fuel and convenience stores and other
    assets from BP in December 2005 for $35.0 million, of which
    $5.0 million was financed with cash on hand and
    $30.0 million was financed from borrowings under our
    revolving credit facility.
33
Table of Contents
(2)
The number of shares of common stock to be authorized, issued
    and outstanding after the offering:
•
gives effect to
    a           -for-one
    stock split of our common stock, which will be effective
    immediately prior to this offering;
•
excludes          shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $           per
    share;
•
excludes          shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;
•
excludes          shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form
S-8
registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form
S-8
we intend
    to file within 30 days after the completion of this
    offering;
•
excludes          shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan; and
•
assumes no exercise by the underwriters of their option to
    purchase up
    to                     additional
    shares of common stock from us if they sell more
    than                      shares
    in the offering.
34
Table of Contents
DILUTION
If you invest in our common stock, your interest will be diluted
to the extent of the difference between the public offering
price per share of our common stock and the pro forma net
tangible book value per share of our common stock after giving
effect to this offering. Net tangible book value dilution per
share represents the difference between the amount per share
paid by purchasers of common stock in this offering and the pro
forma net tangible book value per share of common stock
immediately after completion of this offering.
Our net tangible book value as of September 30, 2005 was
approximately $17.8 million, or approximately
$           per
share of common stock.
We have calculated this amount by:
•
subtracting our total liabilities from our total tangible
    assets; and
•
then dividing the difference by the number of shares of common
    stock outstanding.
If we give effect to our sale
of                      shares
of common stock in this offering at an assumed initial public
offering price of
$           per
share, the midpoint of the range set forth on the cover page of
this prospectus, after deducting estimated underwriting
discounts and commissions and estimated offering expenses that
are payable by us, our adjusted net tangible book value as of
September 30, 2005 would have been approximately
$          ,
or approximately
$           per
share. This amount represents an immediate dilution of
$           per
share to new investors. The following table illustrates this per
share dilution:
Assumed initial public offering price per share of common
    stock(1)
$
Net tangible book value per share as of September 30, 2005
$
Increase in net tangible book value per share attributable to
    new investors in this offering
Pro forma net tangible book value per share after this offering
Dilution per share to new investors
$
The following table summarizes on the basis described above, as
of September 30, 2005, the difference between the number of
shares of common stock purchased from us, the total cash
consideration paid to us, and the average price per share paid
by our existing stockholder since our inception and by new
investors in this offering, at an assumed initial public
offering price of
$           per
share, the midpoint of the range set forth on the cover page of
this prospectus, before deducting estimated underwriting
discounts and commissions and estimated offering expenses that
are payable by us:
Shares
Total
Average Price
Purchased
Consideration
Per Share
Number
%
Amount
%
Existing stockholder(2)
%
$
%
$
New investors
Total
100.0
%
$
100.0
%
(1)
Before deducting estimated underwriting discounts and
    commissions and estimated offering expenses that are payable by
    us.
(2)
If the underwriters exercise their option to purchase additional
    shares in full, the number of shares of common stock held by our
    existing stockholder will decrease
    to                     ,
    or      % of the total number of shares
    of common stock to be outstanding immediately after this
    offering and the number of shares held by new investors will
    increase
    to                     ,
    or      % of the total number of shares
    of common stock to be outstanding immediately after this
    offering.
35
Table of Contents
The tables above assume no exercise of share purchase rights
outstanding on September 30, 2005. As of September 30,
2005, there were outstanding share purchase rights to
purchase                      shares
of common stock, at a weighted average exercise price of
$           per
share, subject to certain vesting requirements. No share
purchase rights were exercisable at September 30, 2005, as
their exercise is contingent upon our becoming a publicly traded
company. To the extent these share purchase rights are exercised
after consummation of this offering, there will be further
dilution to new investors. If all of these outstanding share
purchase rights had been exercised as of September 30,
2005, net tangible book value per share after this offering
would have been
$                    and
total dilution per share to new investors would have been
$                    .
In addition, we plan to grant options and restricted stock units
in connection with this offering, as further described under
"Management — IPO Awards," and may issue
other equity securities in the future that may be dilutive to
investors in this offering.
36
Table of Contents
SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
The following table sets forth selected historical consolidated
financial and other data. The following selected historical
consolidated financial information for the period from inception
(April 10, 2001) to December 31, 2001 and for the
years ended December 31, 2002, 2003 and 2004 is derived
from our audited consolidated financial statements. The audited
consolidated financial statements for the years ended
December 31, 2002, 2003 and 2004 appear elsewhere in this
prospectus.
The selected historical financial information for the nine-month
periods ended September 30, 2004 and 2005 are derived from
our unaudited condensed consolidated financial statements
appearing elsewhere in this prospectus. In the opinion of
management, the unaudited financial statements include all
adjustments, consisting of only normal recurring adjustments,
necessary for a fair presentation of the financial position and
the results of operations for these periods. Operating results
for the nine-month periods ended September 30, 2005, are
not necessarily indicative of the results that may be expected
for the entire year ending December 31, 2005. Additionally,
our financial condition and results of operations for certain
periods may not be comparable due to the acquisition of
Williamson Oil effective April 30, 2004, the acquisition of
the Tyler refinery and related assets effective April 29,
2005, various refinancings of indebtedness and other
transactions.
The operating information under Key Operating Statistics was
derived from our internal reporting systems.
The information contained in this table should also be read in
conjunction with "Capitalization," "Unaudited Pro
Forma Condensed Consolidated Financial Data,"
"Management's Discussion and Analysis of Financial
Condition and Results of Operations," and the consolidated
financial statements and accompanying notes thereto included
elsewhere in this prospectus.
Period from
Inception
(April 10,
Nine Months Ended
2001) to
Year Ended December 31,
September 30,
December 31,
2001
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Statement of Operations Data:
Net sales:
Retail
$
311,180
$
549,632
$
600,157
$
857,834
$
617,955
$
798,974
Refining
—
—
—
—
—
588,326
Other
—
—
—
65
16
241
Total
311,180
549,632
600,157
857,899
617,971
1,387,541
Expenses:
Cost of goods sold
257,271
460,337
500,181
730,780
526,294
1,179,495
Operating expenses
35,958
62,050
62,704
80,060
58,289
92,286
General and administrative expenses
6,945
12,227
12,874
15,122
10,665
17,037
Depreciation and amortization
4,553
7,426
8,784
12,374
8,674
11,472
(Gain) on disposal of assets
—
—
(430
)
(898
)
(227
)
(1,638
)
Losses on forward contract hedging activities(3)
—
—
—
—
—
10,923
304,727
542,040
584,113
837,438
603,695
1,309,575
Operating income
6,453
7,592
16,044
20,461
14,276
77,966
Interest expense, net
4,365
5,747
5,872
7,059
5,001
10,765
Interest expense — related party
—
—
120
1,210
778
2,287
Write-off of deferred financing costs(4)
—
—
—
—
—
3,466
(Gain) loss on derivative instruments(5)
—
2,583
(242
)
727
875
(1,014
)
Guarantee fees(6)
—
—
—
—
—
313
4,365
8,330
5,750
8,996
6,654
15,817
37
Table of Contents
Period from
Inception
(April 10,
Nine Months Ended
2001) to
Year Ended December 31,
September 30,
December 31,
2001
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Income (loss) before income taxes and cumulative effect of
    change in accounting policy
2,088
(738
)
10,294
11,465
7,622
62,149
Income tax expense (benefit)
794
(264
)
3,814
4,132
2,872
22,362
Income before cumulative effect of change in accounting policy
1,294
(474
)
6,480
7,333
4,750
39,787
Cumulative effect of change in accounting policy
—
—
—
—
—
267
Net income (loss)
$1,294
$(474
)
$6,480
$7,333
$4,750
$39,520
Basic and diluted earnings (loss) per share(7):
Income before cumulative effect of change in accounting policy
$
$
$
$
$
$
Cumulative effect of change in accounting policy
Net income (loss)
$
$
$
$
$
$
Weighted average shares, basic and diluted(7)
Cash Flow Data:
Cash flows provided by (used in) operating activities
$16,614
$17,528
$26,333
$24,926
$16,218
$139,230
Cash flows provided by (used in) investing activities
(208,574
)
(12,066
)
(16,149
)
(27,343
)
(26,763
)
(83,588
)
Cash flows provided by (used in) financing activities
201,928
(4,465
)
(2,242
)
5,616
13,962
69,279
Net (decrease) increase in cash and cash equivalents
$9,968
$997
$7,942
$3,199
$3,417
$124,921
Segment Data (8)
Nine Months Ended September 30, 2005
Corporate,
Other and
Refining(2)
Retail
Eliminations(9)
Consolidated
(Dollars in thousands)
Net sales (excluding intercompany sales)
$588,326
$798,974
$241
$1,387,541
Intercompany sales
888
—
(888
)
—
Cost of goods sold
489,401
690,982
(888
)
1,179,495
Operating expenses
27,636
64,402
248
92,286
Segment contribution margin
$72,177
$43,590
$(7
)
115,760
General and administrative expenses
17,037
Depreciation and amortization
11,472
(Gain) on disposal of assets
(1,638
)
Losses on forward contract activities(3)
10,923
Operating income
$77,966
38
Table of Contents
Period from
Inception
(April 10,
Nine Months Ended
2001) to
Year Ended December 31,
September 30,
December 31,
2001
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except pricing information)
Other Data:
Adjusted EBITDA(10)
$11,006
$15,018
$24,398
$31,937
$22,723
$98,456
Capital expenditures
2,648
9,773
5,181
6,974
4,832
8,415
Key Operating Statistics:
REFINING SEGMENT
Days operated in period(2)
155
Total sales volume (average barrels per day)
52,646
Products manufactured (average barrels per day)
Gasoline
27,366
Diesel/ Jet
21,288
Petrochemicals, LPG, NGLs
2,517
Other
1,061
Total production
52,232
Throughput (average barrels per day)
Crude oil
52,887
Other feedstocks
878
Total throughput
53,765
Per barrel of sales
Refining operating margin(11)
$12.23
Direct operating expenses
$3.39
RETAIL SEGMENT
Number of stores (end of period)
234
236
243
331
332
328
Average number of stores
234
236
242
310
302
329
Retail fuel sales (thousands of gallons)
155,552
267,396
267,476
315,294
231,315
249,507
Average retail gallons per average number of stores (in
    thousands)
665
1,133
1,105
1,017
766
758
Retail fuel margin (per gallon)
$0.147
$0.130
$0.154
$0.155
$0.149
$0.164
Merchandise sales
$118,388
$204,536
$206,950
$261,232
$191,728
$219,840
Merchandise margin %
26.2
%
26.7
%
28.4
%
29.5
%
29.4
%
30.0
%
39
Table of Contents
As of December 31,
As of September 30,
2001
2002
2003
2004(1)
2005(2)
(Dollars in thousands)
Balance Sheet Data:
Cash and cash equivalents
$9,968
$10,965
$18,907
$22,106
$147,027
Total current assets
39,065
40,016
46,745
64,094
336,534
Property and equipment, net
126,617
130,892
136,538
189,293
219,418
Total assets
226,152
234,086
256,754
330,173
641,558
Total current liabilities
181,935
39,324
48,540
72,285
227,971
Total debt, including current maturities
161,107
161,713
168,752
203,333
282,678
Total noncurrent liabilities
1,802
152,821
159,793
202,134
318,313
Total stockholder's equity
42,415
41,941
48,421
55,754
95,274
Total liabilities and stockholder's equity
226,152
234,086
256,754
330,173
641,558
(1)
Effective April 30, 2004, we completed the acquisition of
    100% of the outstanding stock of Williamson Oil. Because the
    results of operations of Williamson Oil are included in our
    financial results from the date of acquisition, a comparison of
    our
period-to
-period
    financial results may not necessarily be meaningful. See
    "Unaudited Pro Forma Condensed Consolidated Financial
    Data," which shows what our results of operations might
    have been had we acquired Williamson Oil on January 1, 2004.
(2)
Effective April 29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155 days in the fiscal period ended
    September 30, 2005. Because the results of operations of
    the Tyler refinery and related assets are included in our
    financial results from the date of acquisition, a comparison of
    our
period-to
-period
    financial results may not necessarily be meaningful. See
    "Unaudited Pro Forma Condensed Consolidated Financial
    Data," which shows what our results of operations might
    have been in 2004 and the nine months ended September 30,
    2005 had we acquired the Tyler refinery and related assets on
    January 1, 2004.
(3)
In order to mitigate the risks of changes in the market price of
    crude oil and refined petroleum products, we entered into
    forward contracts to fix the purchase price of crude and sales
    price of specific refined petroleum products for a predetermined
    number of units at a future date. The fair value adjustment of
    these contracts in the third quarter of 2005 resulted in a loss
    of $10.9 million. These contracts were entered into with an
    affiliate of Citigroup Global Markets Inc., one of the
    underwriters of this offering.
(4)
In 2005, we refinanced a significant portion of our existing
    debt. As a result, financing costs associated with the
    refinanced debt were written-off.
(5)
We have entered into interest rate swap and cap agreements in
    connection with a portion of our floating rate debt. These
    interest rate swap and cap agreements are marked to fair value
    each period.
(6)
In 2005, our parent company guaranteed a portion of our new debt
    and other instruments in connection with the acquisition of the
    Tyler refinery. We have agreed to pay our parent a fee for these
    guarantees.
(7)
Gives effect to
    a                for-one
    split of our common stock, which will be effective immediately
    prior to this offering.
(8)
Statement of Accounting Standards No. 131,
Disclosures
    About Segments of an Enterprise and Related Information,
requires disclosure of a measure of segment profit or loss. In
    connection with the purchase of the Tyler refinery and related
    assets on April 29, 2005, management began viewing our
    company's operating results in two reportable
    segments: retail and refining. We measure the operating
    performance of each segment based on segment contribution
    margin. We define segment contribution margin as net sales less
    cost of goods sold and operating expenses, excluding
    depreciation and amortization.
For the retail segment, cost of goods sold comprises the costs
    of specific products sold. Operating expenses include costs such
    as wages of employees at the stores, lease expense for the
    stores, utility expense for the stores and other costs of
    operating the stores, excluding depreciation and amortization.
40
Table of Contents
For the refining segment, cost of goods sold includes all the
    costs of crude oil, feedstocks and related transportation.
    Operating expenses include the costs associated with the actual
    operations of the refinery, excluding depreciation and
    amortization.
Prior to the purchase of the Tyler refinery and related assets,
    we had only the retail segment. Accordingly, segment data prior
    to 2005 is not applicable.
(9)
Consists of fuel credit card services provided by one of our
    subsidiaries and eliminations of intercompany indebtedness.
(10)
EBITDA represents earnings before income tax expense, interest
    expense, the write-off of deferred financing costs, (gain) loss
    on derivative instruments, guarantee fees, depreciation and
    amortization. Adjusted EBITDA represents earnings before income
    tax expense, interest expense, the write-off of deferred
    financing costs, (gain) loss on derivative instruments,
    losses on forward contract activities, guarantee fees,
    depreciation, amortization and (gain) loss on disposal of
    assets. EBITDA and Adjusted EBITDA, however, are not recognized
    measurements under GAAP. Our management believes that the
    presentation of Adjusted EBITDA is useful to investors because
    it is frequently used by securities analysts, investors and
    other interested parties in the evaluation of companies in our
    industry.
In addition, our management believes that Adjusted EBITDA is
    useful in evaluating our operating performance compared to that
    of other companies in our industry because the calculation of
    Adjusted EBITDA generally eliminates the effects of financings,
    income taxes, risk management activities and the disposal of
    assets, items which may vary for different companies for reasons
    unrelated to overall operating performance.
Adjusted EBITDA has limitations as an analytical tool, and you
    should not consider it in isolation, or as a substitute for
    analysis of our results as reported under GAAP. Some of these
    limitations are:
•
Adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or contractual commitments;
•
Adjusted EBITDA does not reflect the interest expense or the
    cash requirements necessary to service interest or principal
    payments on our debt;
•
Adjusted EBITDA does not reflect changes in or cash requirements
    for our working capital needs; and
•
Our calculation of Adjusted EBITDA may differ from the EBITDA
    and Adjusted EBITDA calculations of other companies in our
    industry, limiting its usefulness as a comparative measure.
41
Table of Contents
Because of these limitations, Adjusted EBITDA should not be
    considered a measure of discretionary cash available to us to
    invest in the growth of our business. We compensate for these
    limitations by relying primarily on our GAAP results and using
    Adjusted EBITDA only on a supplemental basis.
The following table reconciles net income (loss) to Adjusted
EBITDA for the periods presented:
Period from
Inception
(April 10,
Nine Months Ended
2001) to
Year Ended December 31,
September 30,
December 31,
2001
2002
2003
2004
2004
2005
Net income (loss)
$
1,294
$
(474
)
$
6,480
$
7,333
$
4,750
$
39,520
Interest expense, net
4,365
5,747
5,992
8,269
5,779
13,052
Write-off of deferred financing costs(4)
—
—
—
—
—
3,466
(Gain) loss on derivative instruments(5)
—
2,583
(242
)
727
875
(1,014
)
Guarantee fees(6)
—
—
—
—
—
313
Depreciation and amortization
4,553
7,426
8,784
12,374
8,674
11,472
Income tax expense (benefit)
794
(264
)
3,814
4,132
2,872
22,362
EBITDA
11,006
15,018
24,828
32,835
22,950
89,171
(Gain) on disposal of assets
—
—
(430
)
(898
)
(227
)
(1,638
)
Loss on forward contract activities(3)
—
—
—
—
—
10,923
Adjusted EBITDA
$
11,006
$
15,018
$
24,398
$
31,937
$
22,723
$
98,456
(11)
Refining operating margin per barrel is calculated by dividing
    the margin between net sales and cost of crude oil, feedstocks
    and related transportation by the total barrels sold at our
    refinery.
Industry-wide
refining results are driven and measured by the margins between
    refined petroleum product prices and the prices for crude oil,
    which are referred to as crack spreads: the differential in
    price between a representative barrel of benchmark refined
    petroleum products, such as gasoline or heating oil, and a
    barrel of benchmark crude oil. The US Gulf Coast 5-3-2
    crack spread represents the differential between the
    Platt's quotations for
3
/
5
of a barrel of US Gulf Coast Pipeline 87 Octane
    Conventional Gasoline and
2
/
5
of a barrel of US Gulf Coast Pipeline No. 2 Heating Oil
    (high sulfur diesel) on the one hand, and the first month
    futures price of
5
/
5
of a barrel of light sweet crude oil on the New York Mercantile
    Exchange, on the other hand. We compare our refining operating
    margin to these crack spreads to assess our operating
    performance relative to other participants in our industry.
42
Table of Contents
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL DATA
The following unaudited pro forma condensed consolidated
financial data give effect to the following acquisitions:
•
Our acquisition on April 30, 2004 of 100% of the issued and
    outstanding stock of Williamson Oil, including operating assets,
    working capital and related debt for 89 company-operated
    retail fuel and convenience stores and a wholesale fuel and
    merchandise distribution operation with 11 company-owned but not
    operated retail fuel and convenience stores, located primarily
    in the state of Alabama. We refer to this transaction as the
    Williamson Oil acquisition. The total cash consideration we paid
    in connection with the Williamson Oil acquisition was
    approximately $19.8 million. In addition, we assumed debt
    of $28.6 million in connection with this acquisition.
•
Our acquisition on April 29, 2005 of the Tyler refinery and
    crude oil pipeline assets located in Tyler, Texas. We refer to
    this transaction as the Tyler refinery acquisition. The total
    consideration we paid in connection with the Tyler refinery
    acquisition was approximately $68.1 million, including
    $25.9 million of prepaid crude inventory and
    $38.4 million of assumed crude vendor liabilities.
The Williamson Oil acquisition and the Tyler refinery
acquisition have each been accounted for using the purchase
method of accounting as prescribed by SFAS No. 141.
The allocations of purchase prices to the underlying net assets
have been based on the estimates of fair value at the
acquisition dates.
The following unaudited pro forma condensed consolidated
financial data give effect to the Williamson Oil acquisition and
the Tyler refinery acquisition, as if each transaction had been
consummated on January 1, 2004 for statement of operations
purposes.
Our historical financial information for the year ended
December 31, 2004 was derived from our audited consolidated
financial statements of the same period included elsewhere in
this prospectus and the historical financial information for the
nine months ended September 30, 2005 was derived from the
unaudited condensed consolidated financial statements for the
same periods included elsewhere in this prospectus. The results
of operations of Williamson Oil and the Tyler refinery,
respectively, are included in our historical results from
April 30, 2004 and April 29, 2005, the respective
closing dates of the Williamson Oil and the Tyler refinery
acquisitions.
The historical financial information of Williamson Oil included
in the unaudited pro forma condensed consolidated financial data
represents the results of operations of Williamson Oil for the
period prior to its acquisition by us on April 30, 2004 and
was derived from unaudited financial information of Williamson
Oil for the period from January 1, 2004 to April 29,
2004.
The historical financial information of the Tyler refinery for
the year ended December 31, 2004 was derived from the
audited combined financial statements for the same period
included elsewhere in this prospectus. The historical financial
information of the Tyler refinery for the period prior to its
acquisition by us on April 29, 2005 was derived from
unaudited financial information of the Tyler refinery for the
period from January 1, 2005 to April 28, 2005.
The unaudited pro forma condensed consolidated financial data
include adjustments, which are based upon preliminary estimates
in the case of the Tyler refinery acquisition, to reflect the
allocation of purchase price to net tangible and intangible
assets acquired in each of the business combinations, as well as
preliminary estimates of transaction costs in the case of the
Tyler refinery acquisition. The preliminary purchase price
allocations and other estimates are subject to revision as more
detailed analysis is completed and additional information
becomes available. Financial purchase accounting adjustments may
differ materially from pro forma adjustments presented in this
prospectus.
The unaudited pro forma condensed consolidated financial data
have been presented for illustrative purposes only and are not
necessarily indicative of either future results or the results
that might have been recorded if the business combinations had
been consummated on such dates. These unaudited pro forma
condensed consolidated financial data should be read in
conjunction with the related notes. In addition, these unaudited
pro forma condensed consolidated financial data are based upon
and should be read in conjunction with the historical financial
statements and related notes thereto discussed above.
43
Table of Contents
Delek US Holdings, Inc.
Unaudited Pro Forma Consolidated Statements of Operations
For the Year Ended December 31, 2004
Historical
Delek
Williamson
US Holdings, Inc.
Tyler Refinery
Oil Co., Inc.
Pro Forma Adjustments
for the Year
for the
from
Ended
Year Ended
January 1, 2004
Williamson
Pro Forma
December 31, 2004
December 31, 2004
to April 29, 2004
Tyler Refinery
Oil Co., Inc.
Consolidated
(Dollars in thousands, except per share data)
Net sales
$
857,899
$
839,212
$
78,456
$
1,775,567
Operating costs and expenses:
Cost of goods sold
730,780
796,078
68,702
(197
)(a)
1,533,487
(61,876
)(b)
Operating expenses
80,060
—
7,762
61,876
(b)
150,317
619
(c)
General and administrative expenses
15,122
4,074
1,370
(619
)(c)
19,947
Depreciation and amortization
12,374
5,891
1,362
(4,031
)(d)
(88
)(d)
15,508
Impairment
—
15,301
—
15,301
(Gain) loss on disposal of assets
(898
)
(95
)
33
(960
)
837,438
821,249
79,229
(4,228
)
(88
)
1,733,600
Operating income (loss)
20,461
17,963
(773
)
4,228
88
41,967
Interest expense (income), net
8,269
(2,221
)
871
4,975
(e)
13,894
1,560
(f)
151
(f)
1,160
(g)
(871
)(h)
Loss on interest rate derivative instruments
727
—
—
727
Guarantee fees
—
—
—
750
(i)
750
8,996
(2,221
)
871
7,285
440
15,371
Income (loss) before income taxes
11,465
20,184
(1,644
)
(3,057
)
(352
)
26,596
Income tax expense (benefit)
4,132
6,987
—
(1,102
)(j)
(127
)(j)
9,890
Net income (loss)
$7,333
$13,197
$(1,644
)
$(1,955
)
$(225
)
$16,706
Basic and diluted earnings per share
$73,330
$167,060
Weighted average common shares and equivalents outstanding,
    basic and diluted
100
100
(a)
The adjustment includes amounts to eliminate historical
    seller's pension expense of the Tyler refinery arising from
    the seller's defined benefit plan, which were accounted for
    as direct operating costs of the Tyler refinery and included in
    cost of goods sold. We do not sponsor a defined benefit plan.
(b)
The adjustment reflects the reclassification of certain Tyler
    refinery cost of goods sold to operating expenses to conform
    with our presentation.
44
Table of Contents
(c)
The adjustment reflects the reclassification of certain Tyler
    refinery general and administrative expenses to operating
    expenses to conform with our presentation.
(d)
The adjustment reflects amounts to eliminate historical
    depreciation of $5.9 million and $1.4 million for the
    Tyler refinery and Williamson Oil, respectively, and the
    inclusion of our depreciation of $1.9 million and
    $1.3 million for the Tyler refinery and Williamson Oil,
    respectively, using our new basis as a result of the purchase
    price allocations in accordance with SFAS 141,
Business
    Combinations
.
(e)
The adjustment reflects interest expense related to the debt
    used to finance the acquisition of the Tyler refinery
    (1) with third parties in the aggregate principal amount of
    $50.0 million at a combined interest rate of 5.05% and
    (2) with a related party in the aggregate principal amount
    of $35.0 million at an interest rate of 7.00%.
(f)
The adjustment reflects amortization of deferred financing costs
    capitalized in connection with the execution of certain loans
    used to finance the Williamson Oil and Tyler refinery
    acquisitions.
(g)
The adjustment reflects interest expense related to the debt
    used to finance the Williamson Oil acquisition (1) with a
    third party in the aggregate principal amount of
    $34.5 million at an interest rate of 5.20% and
    (2) with a related party in the aggregate principal amount
    of $25.0 million at an interest rate of 6.30%. Additional
    amounts include interest expense of $37,000 related to certain
    capital leases assumed in the Williamson Oil acquisition.
(h)
The adjustment reflects amounts to eliminate the historical
    interest expense of Williamson Oil.
(i)
The adjustment reflects fees related to a parent guaranty
    agreement in the aggregate principal amount of
    $50.0 million at an interest rate of 1.50%.
(j)
The adjustment reflects the tax effect of the pro forma
    adjustment utilizing our estimated effective income tax rate.
45
Table of Contents
Delek US Holdings, Inc.
Unaudited Pro Forma Consolidated Statements of Operations
For the Nine Months Ended September 30, 2005
Historical
Delek US Holdings,
Inc. for the Nine
Tyler Refinery from
Months Ended
January 1, 2005 to
Pro Forma
Pro Forma
September 30, 2005
April 28, 2005
Adjustments
Consolidated
(Dollars in thousands, except per share data)
Net sales
$1,387,541
$280,292
$1,667,833
Operating costs and expenses:
Cost of goods sold
1,179,495
270,120
(52
)(a)
1,426,742
(22,821
)(b)
Operating expenses
92,286
—
22,821
(b)
115,380
273
(c)
General and administrative expenses
17,037
695
(273
)(c)
17,459
Depreciation and amortization
11,472
729
(109
)(d)
12,092
(Gain) on disposal of assets
(1,638
)
—
(1,638
)
Losses on forward contract hedging activities
10,923
—
10,923
1,309,575
271,544
(161
)
1,580,958
Operating income
77,966
8,748
161
86,875
Interest expense (income), net
13,052
(664
)
1,713
(e)
14,621
520
(f)
Write-off of deferred financing costs in connection with
    refinancing
3,466
—
3,466
(Gain) on interest rate derivative instruments
(1,014
)
—
(1,014
)
Guarantee fees
313
—
250
(g)
563
15,817
(664
)
2,483
17,636
Income (loss) before income taxes
62,149
9,412
(2,322
)
69,239
Income tax expense (benefit)
22,362
3,577
(835
)(h)
25,104
Income (loss) before cumulative effect of change in accounting
    policy
$39,787
$5,835
$(1,487
)
$44,135
Basic and diluted earnings per share
$397,870
$441,350
Weighted average common shares and equivalents outstanding,
    basic and diluted
100
100
(a)
The adjustment includes amounts to eliminate historical
    seller's pension expense of the Tyler refinery arising from
    the seller's defined benefit plan, which were accounted for
    as direct operating costs of the Tyler refinery and included in
    cost of goods sold. We do not sponsor a defined benefit plan.
(b)
The adjustment reflects the reclassification of certain Tyler
    refinery cost of goods sold to operating expenses to conform
    with our presentation.
(c)
The adjustment reflects the reclassification of certain Tyler
    refinery general and administrative expenses to operating
    expenses to conform with our presentation.
(d)
The adjustment reflects amounts to eliminate historical
    depreciation of $0.7 million and the inclusion of our
    depreciation of $0.6 million using our basis as a result of
    the purchase price allocation in accordance with SFAS 141,
Business Combinations
.
46
Table of Contents
(e)
The adjustment reflects interest expense related to the debt
    used to finance the acquisition of the Tyler refinery with
    (1) third parties in the aggregate principal amount of
    $50.0 million at a combined interest rate of 5.05% and
    (2) with a related party in the aggregate principal amount
    of $35.0 million at an interest rate of 7.00%.
(f)
The adjustment reflects amortization of deferred financing costs
    capitalized in connection with the execution of certain loans
    used to finance the Tyler refinery acquisition.
(g)
The adjustment reflects fees related to a parent guaranty
    agreement in the aggregate principal amount of
    $50.0 million at an interest rate of 1.50%.
(h)
The adjustment reflects the tax effect of the pro forma
    adjustments utilizing our estimated effective income tax rate.
47
Table of Contents
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a discussion and analysis of our financial
condition and results of operations for the years ended
December 31, 2002, 2003 and 2004 and for the nine months
ended September 30, 2004 and 2005. You should read this
discussion and analysis together with our consolidated financial
statements and notes to those consolidated financial statements
included elsewhere in this prospectus. This discussion contains
forward-looking statements that are based on management's
current expectations, estimates and projections about our
business and operations. Our actual results may differ from
those currently anticipated and expressed in such
forward-looking statements as a result of a number of factors,
including those described under the caption "Risk
Factors" and elsewhere in this prospectus.
Company Overview
We are a diversified energy business focused on petroleum
refining and supply and on retail marketing. Our business
consists of two main operating segments: refining and retail.
•
Refining segment.
Our refining segment operates a high
    conversion, moderate complexity independent refinery in Tyler,
    Texas, with a design crude distillation capacity of
    60,000 bpd, along with an associated crude oil pipeline and
    light products loading facilities.
•
Retail segment.
Our retail segment markets gasoline,
    diesel, other refined petroleum products and convenience
    merchandise through a network of 349 company-operated
    retail fuel and convenience stores located in Alabama, Arkansas,
    Georgia, Kentucky, Louisiana, Mississippi, Tennessee and
    Virginia. We also have a wholesale fuel distribution operation.
We are a Delaware corporation formed in April 2001. We are an
indirect wholly-owned subsidiary of Delek Group Ltd., a
conglomerate that is domiciled and publicly traded in Israel,
which has significant interests in fuel supply businesses, and
which is controlled by Mr. Yitzchak Sharon Teshuva, an
Israeli citizen. We were formed by Delek Group Ltd. in
connection with our acquisition in May 2001 of 198 retail fuel
and convenience stores from a subsidiary of The Williams
Companies. Since then, we have completed several other
acquisitions of retail fuel and convenience stores. In 2005, we
expanded our scope of operations to include complementary
petroleum refining and wholesale and distribution businesses by
acquiring the Tyler refinery.
Major Influences on Results of Operations
Refining.
Our earnings and cash flow from our refining
segment are primarily affected by the difference between refined
petroleum product prices and the prices for crude oil and other
feedstocks. The cost to acquire feedstocks and the price of the
refined petroleum products we ultimately sell depend on numerous
factors beyond our control, including the supply of, and demand
for, crude oil, gasoline and other refined petroleum products
which, in turn, depend on, among other factors, changes in
domestic and foreign economies, weather conditions, domestic and
foreign political affairs, production levels, the availability
of imports, the marketing of competitive fuels and government
regulation. While our sales and operating revenues fluctuate
significantly with movements in crude oil and refined petroleum
product prices, it is the spread between crude oil and refined
petroleum product prices, and not necessarily fluctuations in
those prices, that affects our earnings.
In order to measure our operating performance, we compare our
per barrel refining operating margin to certain industry
benchmarks, specifically the US Gulf Coast 5-3-2 crack spread.
The US Gulf Coast 5-3-2 crack spread represents the differential
between Platt's quotations for
3
/
5
of a barrel of US Gulf Coast Pipeline 87 Octane Conventional
Gasoline and
2
/
5
of a barrel of US Gulf Coast Pipeline No. 2 Heating Oil
(high sulfur diesel) on the one hand, and the first month
futures price of
5
/
5
of a barrel of light sweet crude oil on the New York Mercantile
Exchange, on the other hand.
Our refinery processes primarily light, sweet crude oils, and
converts approximately 97% of the crude oil and other feedstocks
into salable refined petroleum products. In addition to locally
produced crude oil grades,
48
Table of Contents
we are able to access other domestic and foreign crude oils
available in Texas and on the US Gulf Coast through the
connection of our owned and leased pipelines to numerous common
carrier pipeline systems that converge in Longview, Texas,
enabling us to better optimize our crude supply. Our primary
market area commands a premium over US Gulf Coast refined
petroleum products prices generally in line with transportation
costs to import product into the region. As a result of the
flexibility in crude oil supply, our high conversion of crude
oil to light products, and transportation costs of others for
entry into our primary market area, our refining operating
margin before operating expense generally approximates the US
Gulf Coast 5-3-2 crack spread.
The results of operations from our refining segment are also
significantly affected by our Tyler refinery's operating
costs, particularly the cost of natural gas used for fuel and
the cost of electricity. Natural gas prices have historically
been volatile. For example, spot natural gas prices at Henry Hub
ranged between $5.50 and $7.82 per million British Thermal
Units, or MMBTU, in the first half of 2005. During the second
half of 2005, primarily as a result of the loss of domestic
production related to damage from Hurricanes Katrina and Rita,
natural gas prices ranged between $7.00 and $15.39 per
MMBTU. In our region, electricity prices fluctuate with natural
gas prices.
Demand for gasoline and margins on gasoline sales are generally
higher during summer months than during winter months due to
seasonal increases in highway traffic in our region. During the
winter months, demand for diesel fuel and margins on diesel
sales are generally higher than in the summer months, as
east-west trucking traffic moves south to avoid winter
conditions on northern routes. Since there is limited
flexibility on shifting the refinery yield structure from
gasoline to diesel, margins in the first and fourth quarters are
typically lower than margins in the second and third quarters.
Changes in regional supply/demand patterns, supply disruptions,
and general market conditions may offset these typical margin
patterns.
Reliability of our refinery operations is important to our
financial performance. Unplanned downtime of our refinery
generally results in lost refining operating margin opportunity,
increased maintenance costs and temporary changes in working
capital investment and inventory. The financial impact of
planned downtime, such as a turnaround or major maintenance
project, is mitigated through a diligent planning process that
considers product availability, margin environment and the
availability of resources to perform the required maintenance. A
major turnaround was conducted in February 2005 by the previous
owner. During December 2005, we successfully completed a major
turnaround covering all of the process units not involved in the
February turnaround. No additional turnaround activities are
planned prior to 2009.
The nature of our business requires us to maintain substantial
quantities of crude oil and refined petroleum product
inventories. Because crude oil and refined petroleum products
are commodities, we have no control over the changing market
value of these inventories. Because our inventory is valued at
the lower of cost or market value under the LIFO inventory
valuation methodology, price fluctuations generally have little
effect on our financial results, unless the market value of our
inventory drops below LIFO costs. For periods in which the
market price declines below our LIFO cost basis, we could be
subject to significant fluctuations in the recorded value of our
inventory and related cost of sales.
Retail.
Our earnings and cash flow from our retail
segment are primarily affected by the sales and margins of
retail merchandise and motor fuels at our convenience stores.
The cost to acquire the refined fuel products we ultimately sell
depends on numerous factors beyond our control, including the
supply of, and demand for, crude oil, gasoline and other refined
petroleum products which, in turn, depends on, among other
factors, changes in domestic and foreign economies, weather
conditions, domestic and foreign political affairs, production
levels, the availability of imports, the marketing of
competitive fuels and government regulation.
The gross margin of our retail merchandise is retail merchandise
sales less the delivered cost of the retail merchandise, net of
vendor discounts, measured as a percentage of total retail
merchandise sales. Our retail merchandise sales are driven by
convenience, customer service, competitive pricing and branding.
Motor fuel margin is sales less the delivered cost of fuel and
motor fuel taxes, measured on a cents per gallon, or cpg, basis.
Our motor fuel margins are impacted by local supply, demand,
weather and competitor pricing.
49
Table of Contents
There is some seasonality to our business with the summer and
warmer weather months providing higher sales and increased
traffic. As driving patterns are reduced in the cooler winter
months, traffic is reduced and sales can decline. Conversely,
merchandise margins typically increase in the cooler, winter
months as lower margin items like take-home beverages are
consumed and purchased less often. Weather conditions throughout
the year can also impact our business as rain typically reduces
customer traffic and sales, while warmer, dryer weather
generally increases traffic and sales. Changes in regional
supply/demand patterns, supply disruptions, and general market
conditions may offset these typical seasonal patterns.
Factors Affecting Comparability
Our financial condition and results of operations may not be
comparable with prior periods or to our results of operations in
the future due to the following factors.
Acquisitions.
We have substantially increased the size
and scope of our operations through several significant
acquisitions. We purchased seven retail fuel and convenience
stores in February 2003 from Pilot Oil Corporation. These stores
contributed $38.4 million to our net sales for 2003. In
April 2004, we acquired 100% of the issued and outstanding stock
of Williamson Oil Co., Inc., a chain of 89 company-operated
retail fuel and convenience stores and a wholesale fuel and
merchandise distribution operation with 11 company-owned
but not operated retail fuel and convenience stores, located
primarily in the state of Alabama. These stores contributed
$160.3 million to our net sales for 2004. We operated these
assets for all of 2005. On April 29, 2005, we purchased the
Tyler refinery assets from affiliates of Crown Central
Petroleum, LLC, which contributed $589.2 million to our net
sales and $72.2 million of refining segment contribution
margin in the period from April 29, 2005 to
September 30, 2005. On December 15, 2005, we purchased
21 retail fuel and convenience stores, a network of four
wholesale operations, four undeveloped properties and inventory
in the Nashville, Tennessee area from BP.
Refinancing and Prior Indebtedness.
In April 2005, we
amended and restated our existing secured term and revolving
credit facility for our MAPCO Express subsidiaries with a new
syndicate of lenders. This amended and restated agreement
increased the amount available to us under the lines of credit
to $205.0 million and consolidated the borrowings of two
separate entities into a single credit facility. The amounts
outstanding under this facility at September 30, 2005 were
$172.6 million. In December 2005, we increased commitments
under our senior secured credit facility revolver by
$30.0 million to $70.0 million, and subsequently
borrowed $30.0 million in connection with our acquisition
of retail fuel and convenience stores and other assets from BP.
See "— Liquidity and Capital
Resources — Cash Position, Working Capital and
Indebtedness."
As part of the financing of our Tyler refinery acquisition in
April 2005, we entered into a number of debt arrangements: a
$30.0 million promissory note payable to Israel Discount
Bank of New York; a $20.0 million promissory note payable
to Bank Leumi USA; and a $35.0 million promissory note
payable to Delek Group Ltd. We also entered into a
$250.0 million asset-based senior revolving credit facility
with a syndicate of lenders, led by SunTrust Bank as
administrative agent, to finance ongoing working capital,
capital expenditures and general needs of the Tyler refinery.
See "— Liquidity and Capital
Resources — Cash Position, Working Capital and
Indebtedness."
In connection with these financing transactions, we incurred
$13.8 million in new deferred financing expenses, plus an
additional $1.0 million relating to our acquisition of
retail fuel and convenience stores and other assets from BP,
that will be amortized over the life of the specific facilities.
In addition, in the second quarter of 2005, we wrote-off
approximately $3.5 million of financing costs previously
deferred and relating to debt that we refinanced.
Public Company Expenses.
We expect that our general and
administrative expenses will increase due to the costs of
operating as a public company, such as increases in legal,
accounting and compliance, insurance premiums, and investor
relations. We estimate that these costs will total approximately
$2.0 to $2.5 million on an annual basis. Our financial
statements following this offering will reflect the impact of
these expenses and will affect the comparability with our
financial statements of periods prior to the completion of this
offering.
50
Table of Contents
Stock Based Compensation Expense.
In accordance with our
adoption of SFAS No. 123(R),
Share-Based
Payment,
effective January 1, 2006, we will incur
additional expense associated with existing stock purchase
rights and future stock option grants and equity awards,
including stock options to be granted and restricted stock units
to be awarded in connection with this offering as described
under "Management — IPO Awards." We expect
the expense to be recognized in 2006 related to existing stock
purchase rights and the stock options to be granted in
connection with this offering to be approximately
$                    ,
assuming the consummation of this offering. Amounts related to
future stock option grants and equity awards will depend upon
the terms and levels of future awards.
Recently Issued Accounting Standards
In March 2005, the FASB issued FIN 47,
Accounting for
Conditional Asset Retirement Obligations
(an interpretation
of SFAS No. 143), which requires companies to
recognize a liability for the fair value of a conditional asset
retirement obligation when incurred if the amount can be
reasonably estimated. We adopted FIN-47 effective as of
January 1, 2005.
Associated with the adoption of this standard, we recorded a
cumulative effect of adoption of $0.3 million (net of
$0.2 million of income taxes) and a long-term asset
retirement obligation of $1.5 million.
Subsequent to adoption of FIN 47, we also recorded a long-term
asset retirement obligation on April 29, 2005 in connection with
our purchase of the Tyler refinery of $1.3 million related
to the required disposal of waste in certain storage tanks. In
addition to this identified asset retirement obligation at the
Tyler refinery, we are continuing to evaluate the need for
additional asset retirement obligations related to the Tyler
refinery.
In November 2004, the Financial Accounting Standards Board, or
FASB, issued Statement No. 151,
Inventory Costs,
which clarifies the accounting for abnormal amounts of idle
facility expense, freight, handling costs and wasted material
and requires that those items be recognized as current-period
charges. Statement No. 151 also requires that allocation of
fixed production overhead to the costs of conversion be based on
the normal capacity of the production facilities. Statement
No. 151 is effective for fiscal years beginning after
June 15, 2005, and its impact on our financial position or
results of operations has not been determined.
In December 2004, the FASB issued SFAS No. 123
(revised 2004),
Share-Based Payment,
which is a revision
of SFAS No. 123,
Accounting for Stock-Based
Compensation.
SFAS No. 123(R) supersedes APB
Opinion No. 25,
Accounting for Stock Issued to Employees
and amends SFAS No. 95, Statement of Cash Flows.
Generally, the approach in SFAS No. 123(R) is similar
to the approach described in SFAS No. 123. However,
SFAS No. 123(R) requires all share-based payments to
employees, including grants of employee stock options, to be
recognized in the income statement based on their fair values.
Pro forma disclosure is no longer an alternative.
Adoption of SFAS No. 123(R) is required as of the
first interim or annual reporting period that begins after
June 15, 2005. We will adopt the provisions of
SFAS No. 123(R) effective January 1, 2006.
SFAS No. 123(R) permits public companies to adopt its
requirements using one of two methods:
•
a "modified prospective" method in which compensation
    cost is recognized beginning with the effective date
    (a) based on the requirements of SFAS No. 123(R)
    for all share-based payments granted after the effective date
    and (b) based on the requirements of SFAS No. 123
    for all awards granted to employees prior to the effective date
    of SFAS No. 123(R) that remain unvested on the
    effective date; or
•
a "modified retrospective" method which includes the
    requirements of the modified prospective method described above,
    but also permits entities to restate based on the amounts
    previously recognized under SFAS No. 123 for purposes
    of pro forma disclosures either (a) all prior periods
    presented or (b) prior interim periods of the year of
    adoption.
We plan to adopt SFAS No. 123(R) using the modified
prospective method.
51
Table of Contents
In December 2004, the FASB issued Statement No. 153,
Exchanges of Nonmonetary Assets,
which addresses the
measurement of exchanges of nonmonetary assets. Statement
No. 153 eliminates the exception from fair value
measurement for nonmonetary exchanges of similar productive
assets, which was previously provided by APB Opinion
No. 29,
Accounting for Nonmonetary Transactions,
and
replaces it with an exception for exchanges that do not have
commercial substance. Statement No. 153 specifies that a
nonmonetary exchange has commercial substance if the future cash
flows of the entity are expected to change significantly as a
result of the exchange. Statement No. 153 is effective for
nonmonetary asset exchanges occurring in fiscal periods
beginning after June 15, 2005. The adoption of Statement
No. 153 is not expected to affect our financial position or
results of operations.
In May 2005, the FASB issued SFAS No. 154,
Accounting Changes and Error Correction, a Replacement of APB
Opinion No. 20 and FASB Statement No. 3.
This
statement changes the requirements for accounting for and
reporting a change in accounting principles and applies to all
voluntary changes in accounting principles. It also applies to
changes required by an accounting pronouncement in the unusual
instance that the announcement does not include specific
transition provisions. When an announcement includes specific
transition provisions, those provisions should be followed. This
statement requires retrospective application to prior
periods' financial statements to changes in accounting
principles unless it is impracticable to determine either the
period's specific effects or the cumulative effect of
change. This statement becomes effective for fiscal years
beginning after December 15, 2005.
In September 2005, the Emerging Issues Task Force, or EITF,
reached a consensus concerning the accounting for linked
purchase and sale arrangements in EITF Issue No. 04-13,
Accounting for Purchases and Sales of Inventory with the Same
Counterparty.
The EITF concluded that non-monetary exchanges
of finished goods inventory within the same line of business be
recognized at the carrying value of the inventory transferred.
The consensus is to be applied to new buy/sell arrangements
entered in reporting periods beginning after March 15,
2006. We do not expect the impact of this EITF Issue
No. 04-13 consensus to have a material effect on our
financial position or results of operations.
Critical Accounting Policies
Our accounting policies are described in the notes to our
audited consolidated financial statements included elsewhere in
this prospectus. We prepare our consolidated financial
statements in conformity with U.S. GAAP. In order to apply
these principles, we must make judgments, assumptions and
estimates based on the best available information at the time.
Actual results may differ based on the accuracy of the
information utilized and subsequent events, some of which we may
have little or no control over. Our critical accounting
policies, which are described below, could materially affect the
amounts recorded in our consolidated financial statements.
Inventory.
Refinery inventory consists of crude oil,
refined petroleum products and blendstocks which are stated at
the lower of cost or market. Cost is determined under LIFO
valuation method. The LIFO method requires management to make
estimates on an interim basis of the anticipated on-hand
year-end inventory quantities, which could differ from actual
quantities. Cost of crude oil, refined petroleum product and
blendstock inventories in excess of market value are charged to
cost of goods sold. Such changes are subject to reversal in
subsequent periods, not to exceed LIFO cost, if prices recover.
Retail merchandise inventory consists of gasoline, diesel fuel,
other petroleum products, cigarettes, beer, convenience
merchandise and food service merchandise. Fuel inventories are
stated at the lower of cost or market on a
first-in,
first-out, or
FIFO, basis. Non-fuel inventories are stated at estimated cost
as determined by the retail inventory method.
Revenue Recognition.
In both of our operating segments,
revenues for products sold are recorded at the point of sale
upon delivery of product, which is the point at which title to
the product is transferred, and when payment has either been
received or collection is reasonably assured. In our retail
segment, we derive service revenue from the sale of lottery
tickets, money orders and other ancillary product and service
offerings. Service revenue and related costs are recorded at
gross amounts and net amounts, as appropriate, in accordance
with the provisions of the FASB EITF 99-19,
Reporting
Revenue Gross as a Principal Versus Net
52
Table of Contents
as an Agent.
We record service revenue and related costs
at gross amounts when we are the primary obligor, are subject to
inventory risk, have latitude in establishing prices and
selecting suppliers, influence product or service
specifications, or have several but not all of these indicators.
We record service revenues net of costs when we are not the
primary obligor and do not possess other indicators of gross
reporting as discussed.
Vendor Discounts and Deferred Revenue.
We receive cash
discounts or cash payments from certain vendors related to
product promotions based upon factors such as quantities
purchased, quantities sold, merchandise exclusivity, store space
and various other factors. In accordance with the provisions of
the FASB EITF
Issue
02-16,
Accounting by a Reseller for Consideration Received from a
Vendor,
we recognize these amounts as a reduction of
inventory until the products are sold, at which time the amounts
are reflected as a reduction in cost of goods sold. Certain of
these amounts are received from vendors related to agreements
covering several periods. These amounts are initially recorded
as deferred revenue, are reclassified as a reduction in
inventory upon receipt of the products and are subsequently
recognized as a reduction of cost of goods sold as the products
are sold.
We also receive advance payments from certain vendors related to
contractual agreements. These amounts are recorded as deferred
revenue and are subsequently recognized in revenue as earned in
accordance with the terms of the agreements.
Environmental Expenditures.
It is our policy to accrue
environmental and
clean-up
related costs
of a non-capital nature when it is both probable that a
liability has been incurred and the amount can be reasonably
estimated. Environmental liabilities represent the current
estimated costs to investigate and remediate contamination at
our properties. This estimate is based on third-party
assessments of the extent of the contaminations, the selected
remediation technology and review of applicable environmental
regulations. Accruals for estimated costs from environmental
remediation obligations generally are recognized no later than
completion of the remedial feasibility study and include, but
are not limited to, costs to perform remedial actions and costs
of machinery and equipment that is dedicated to the remedial
actions and that does not have an alternative use. Such accruals
are adjusted as further information develops or circumstances
change. We do not discount environmental liabilities to their
present value unless payments are fixed and determinable.
Expenditures for equipment necessary for environmental issues
relating to ongoing operations are capitalized.
Derivatives.
We currently record all derivative financial
instruments, such as interest rate swap and cap agreements, fuel
related derivatives and forward contracts at estimated fair
value regardless of their intended use in accordance with the
provisions of SFAS No. 133,
Accounting for
Derivative Instruments and Hedging Activities,
as amended
and interpreted. Changes in the fair value of the derivative
instruments are recognized periodically in operations as we have
elected to not comply with the hedging requirements of
SFAS No. 133, which allow such changes to be
classified as comprehensive income. We obtain the fair value of
all derivative financial instruments on a monthly basis from
third party financial and brokerage institutions.
Summary Financial and Other Information
The following tables provide summary financial data and selected
key operating statistics for us and our two operating segments.
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Statement of Operations Data:
Net sales:
Retail
$
549,632
$
600,157
$
857,834
$
617,955
$
798,974
Refining
—
—
—
—
588,326
Other
—
—
65
16
241
Total
549,632
600,157
857,899
617,971
1,387,541
53
Table of Contents
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Expenses:
Cost of goods sold
460,337
500,181
730,780
526,294
1,179,495
Operating expenses
62,050
62,704
80,060
58,289
92,286
General and administrative expenses
12,227
12,874
15,122
10,665
17,037
Depreciation and amortization
7,426
8,784
12,374
8,674
11,472
(Gain) on disposal of assets
—
(430
)
(898
)
(227
)
(1,638
)
Losses on forward contract activities(3)
—
—
—
—
10,923
542,040
584,113
837,438
603,695
1,309,575
Operating income
7,592
16,044
20,461
14,276
77,966
Interest expense, net
5,747
5,872
7,059
5,001
10,765
Interest expense — related party
—
120
1,210
778
2,287
Write-off of deferred financing costs(4)
—
—
—
—
3,466
(Gain) loss on derivative instruments(5)
2,583
(242
)
727
875
(1,014
)
Guarantee fees(6)
—
—
—
—
313
8,330
5,750
8,996
6,654
15,817
Income (loss) before income taxes and cumulative effect of
    change in accounting policy
(738
)
10,294
11,465
7,622
62,149
Income tax expense (benefit)
(264
)
3,814
4,132
2,872
22,362
Income before cumulative effect of change in accounting policy
(474
)
6,480
7,333
4,750
39,787
Cumulative effect of change in accounting policy
—
—
—
—
267
Net income (loss)
$
(474
)
$
6,480
$
7,333
$
4,750
$
39,520
Basic and diluted earnings (loss) per share(7):
Income before cumulative effect of change in accounting policy
$
$
$
$
$
Cumulative effect of change in accounting policy
Net income (loss)
$
$
$
$
$
Weighted average shares, basic and diluted(7)
54
Table of Contents
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except per share data)
Cash Flow Data:
Cash flows provided by (used in) operating activities
$
17,528
$
26,333
$
24,926
$
16,218
$
139,230
Cash flows provided by (used in) investing activities
(12,066
)
(16,149
)
(27,343
)
(26,763
)
(83,588
)
Cash flows provided by (used in) financing activities
(4,465
)
(2,242
)
5,616
13,962
69,279
Net (decrease) increase in cash and cash equivalents
$
997
$
7,942
$
3,199
$
3,417
$
124,921
As of December 31,
As of
September 30,
2002
2003
2004(1)
2005(2)
Balance Sheet Data:
Cash and cash equivalents
$
10,965
$
18,907
$
22,106
$
147,027
Total current assets
40,016
46,745
64,094
336,534
Property and equipment, net
130,892
136,538
189,293
219,418
Total assets
234,086
256,754
330,173
641,558
Total current liabilities
39,324
48,540
72,285
227,971
Total debt, including current maturities
161,713
168,752
203,333
282,678
Total noncurrent liabilities
152,821
159,793
202,134
318,313
Total stockholder's equity
41,941
48,421
55,754
95,274
Total liabilities and stockholder's equity
234,086
256,754
330,173
641,558
Segment Data(8):
Nine Months Ended September 30, 2005
Corporate,
Other and
Refining(2)
Retail
Eliminations(9)
Consolidated
(Dollars in thousands)
Net sales (excluding intercompany sales)
$588,326
$798,974
$241
$1,387,541
Intercompany sales
888
—
(888
)
—
Cost of goods sold
489,401
690,982
(888
)
1,179,495
Operating expenses
27,636
64,402
248
92,286
Segment contribution margin
$72,177
$43,590
$(7
)
115,760
General and administrative expenses
17,037
Depreciation and amortization
11,472
(Gain) on disposal of assets
(1,638
)
Losses on forward contract activities(3)
10,923
Operating income
$77,966
55
Table of Contents
REFINING SEGMENT
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004(1)
2004(1)
2005(2)
(Dollars in thousands, except pricing information)
Days operated in period(2)
155
Total sales volume (average barrels per day)
52,646
Products manufactured (average barrels per day)
Gasoline
27,366
Diesel/ Jet
21,288
Petrochemicals, LPG, NGLs
2,517
Other
1,061
Total production
52,232
Throughput (average barrels per day) Crude oil
52,887
Other feedstocks
878
Total throughput
53,765
Per barrel of sales
Refining operating margin(10)
$
12.23
Direct operating expenses
$
3.39
Pricing statistics (average for the period presented)
WTI — Cushing crude oil (per barrel)
$
59.05
US Gulf Coast 5-3-2 crack spread (per barrel)(11)
$
13.75
US Gulf Coast Unleaded Gasoline (per gallon)
$
1.76
Low sulfur diesel (per gallon)
$
1.75
Natural gas — (per MMBTU)
$
8.40
RETAIL SEGMENT
Number of stores (end of period)
236
243
331
332
328
Average number of stores
236
242
310
302
329
Retail fuel sales (thousands of gallons)
267,396
267,476
315,294
231,315
249,507
Average gallons per average number of stores (in thousands)
1,133
1,105
1,017
766
758
Retail fuel margin (per gallon)
$0.130
$0.154
$0.155
$0.149
$0.164
Merchandise sales without lottery
$204,536
$206,950
$261,932
$191,728
$219,840
Merchandise margin % with lottery
26.7
%
28.4
%
29.5
%
29.4
%
30.0
%
56
Table of Contents
(1)
Effective April 30, 2004, we completed the acquisition of
    100% of the outstanding stock of Williamson Oil. Because the
    results of operations of Williamson Oil are included in our
    financial results from the date of acquisition, a comparison of
    our
period-to
-period
    financial results may not necessarily be meaningful. See
    "Unaudited Pro Forma Condensed Consolidated Financial
    Data," which shows what our results of operations might
    have been had we acquired Williamson Oil on January 1, 2004.
(2)
Effective April 29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155 days in the fiscal period ended
    September 30, 2005. Because the results of operations of
    the Tyler refinery and related assets are included in our
    financial results from the date of acquisition, a comparison of
    our
period-to
-period
    financial results may not necessarily be meaningful. See
    "Unaudited Pro Forma Condensed Consolidated Financial
    Data," which shows what our results of operations might
    have been in 2004 and the nine months ended September 30,
    2005 had we acquired the Tyler refinery and related assets on
    January 1, 2004.
(3)
In order to mitigate the risks of changes in the market price of
    crude oil and refined petroleum products, we entered into
    forward contracts with major financial institutions to fix the
    purchase price of crude and sales price of specific refined
    petroleum products for a predetermined number of units at a
    future date. The fair value adjustment of these contracts in the
    third quarter of 2005 resulted in a loss of $10.9 million.
    These contracts were entered into with an affiliate of Citigroup
    Global Markets Inc., one of the underwriters of this offering.
(4)
In 2005, we refinanced a significant portion of our existing
    debt. As a result, financing costs associated with the previous
    debt were written-off.
(5)
In order to economically hedge a portion of our floating rate
    debt, we enter into interest rate swap and cap agreements. These
    interest rate swap and cap agreements are marked to fair value
    each period.
(6)
In 2005, our parent company guaranteed a portion of our new debt
    and other instruments in connection with the acquisition of the
    Tyler refinery. We have agreed to pay our parent a fee for these
    guarantees.
(7)
Gives effect to
    a                     for-one
    split of our common stock, which will be effective immediately
    prior to this offering.
(8)
Statement of Accounting Standards No. 131,
Disclosures
    About Segments of an Enterprise and Related Information,
requires disclosure of a measure of segment profit or loss. In
    connection with the purchase of the Tyler refinery and related
    assets on April 29, 2005, management began viewing our
    company's operating results in two reportable segments:
    retail and refining. We measure the operating performance of
    each segment within the two reportable segments based on segment
    contribution margin. We define segment contribution margin as
    net sales less cost of goods sold and operating expenses,
    excluding depreciation and amortization.
For the retail segment, cost of goods sold includes the costs of
    specific products sold. Operating expenses include costs such as
    wages of employees at the stores, lease expense for the stores,
    utility expense for the stores and other costs of operating the
    stores, excluding depreciation and amortization.
For the refining segment, cost of goods sold includes all the
    costs of crude oil, feedstocks and related transportation.
    Operating expenses include the costs associated with the actual
    operations of the refinery, excluding depreciation and
    amortization.
Prior to the purchase of the Tyler refinery and related assets,
    we had only the retail segment, thus segment data prior to 2005
    is not applicable.
(9)
Consists of fuel credit card services provided by one of our
    subsidiaries and eliminations of intercompany indebtedness.
(10)
Refining operating margin per barrel is calculated by dividing
    the margin between net sales and cost of crude oil, feedstocks
    and related transportation by the total barrels sold at our
    refinery. Industry-wide refining results are driven and measured
    by the margins between refined petroleum product prices and the
    prices for crude oil, which are referred to as crack spreads. We
    compare our refining operating margin to these crack spreads to
    assess our operating performance relative to other participants
    in our industry.
(11)
The differential in price between a representative barrel of
    benchmark refined petroleum products, such as gasoline or
    heating oil, and a barrel of benchmark crude oil is known as a
    crack spread. The US Gulf Coast 5-3-2 crack spread represents
    the differential between Platt's quotations for
3
/
5
of a barrel of US Gulf Coast Pipeline 87 Octane Conventional
    Gasoline and
2
/
5
of a barrel of US Gulf Coast Pipeline No. 2 Heating Oil
    (high sulfur diesel) on the one hand, and the first month
    futures price of
5
/
5
of a barrel of light sweet crude oil on the New York Mercantile
    Exchange, on the other hand.
57
Table of Contents
Results of Operations
Nine Months Ended September 30, 2005 Compared to the
    Nine Months Ended September 30, 2004
Net Sales
Consolidated.
Net sales were $1,387.5 million for
the nine months ended September 30, 2005, compared to
$618.0 million for the nine months ended September 30,
2004, an increase of $769.5 million or 124.5%. The increase
in net sales was primarily due to $589.2 million in net
sales from the purchase of the Tyler refinery, higher average
retail fuel prices at our convenience stores and the inclusion
of a full nine months of sales from the acquisition of
Williamson Oil stores compared to only five months in the nine
months ended September 30, 2004.
Refining Segment.
Operations in our refining segment
began with the acquisition of the Tyler refinery on
April 29, 2005. Net sales were $589.2 million for the
period from April 29, 2005 through September 30, 2005,
including $0.9 million of intercompany sales. Total sales
volume was 8.2 million barrels at an average sales price of
$72.20 per barrel. Sales volume for refined gasoline was
4.2 million barrels at an average sales price of
$75.50 per barrel. Sales volume for diesel/jet was
3.3 million barrels at an average sales price of
$73.32 per barrel. Sales volume for other product was
0.6 million barrels at an average sales price of
$41.90 per barrel.
Retail Segment.
Net sales for our retail segment were
$799.0 million for the nine months ended September 30,
2005, compared to $618.0 million for the nine months ended
September 30, 2004, an increase of $181.0 million or
29.3%. This increase was primarily due to a 24.1% increase in
average retail fuel prices and $79.2 million in net sales
resulting from the inclusion of a full nine months of sales from
the acquisition of Williamson Oil stores compared to only five
months in the nine months ended September 30, 2004.
Fuel Sales and Gallons.
Retail fuel sales were
    249.5 million gallons for the nine months ended
    September 30, 2005, compared to 231.3 million gallons
    for the nine months ended September 30, 2004. This increase
    was primarily due to the inclusion of a full nine months of
    sales from the acquisition of Williamson Oil stores compared to
    only five months in the nine months ended September 30,
    2004, which led to an increase of 21.6 million gallons.
    This increase was offset by approximately 1.2 million
    gallons lost in the divestiture of stores and the estimated
    2.6 million gallon impact of Hurricane Katrina. Total fuel
    sales, including wholesale gallons, were $579.1 million for
    the nine months ended September 30, 2005, compared to
    $426.2 million over the same period in 2004, an increase of
    $152.9 million or 35.9%. The increase was primarily due to
    an increase of $0.42 per gallon in the average retail price per
    gallon ($2.16 per gallon compared to $1.74 per gallon)
    and $58.3 million in fuel sales resulting from the
    inclusion of a full nine months of fuel sales from the
    acquisition of Williamson Oil stores compared to only five
    months in the nine months ended September 30, 2004.
Merchandise Sales.
Merchandise sales were
    $219.8 million for the nine months ended September 30,
    2005, compared to $191.7 million over the same period in
    2004, an increase of $28.1 million or 14.7%. The increase
    in merchandise sales was primarily due to $20.8 million in
    merchandise sales resulting from the inclusion of a full nine
    months of merchandise sales from the acquisition of Williamson
    Oil stores compared to only five months in the nine months ended
    September 30, 2004, and increases in the cigarette and
    dairy categories. Comparable store (company stores operated for
    the entire period for both the nine-month periods ended
    September 30, 2005 and September 30, 2004) merchandise
    sales increased by 1.5% primarily due to increases in the
    cigarette and dairy categories which were driven by competitive
    pricing and merchandising strategies.
58
Table of Contents
Cost of Goods Sold
Consolidated.
Cost of goods sold was
$1,179.5 million for the nine months ended
September 30, 2005, compared to $526.3 million for the
nine months ended September 30, 2004, an increase of
$653.2 million or 124.1%. Of this increase,
$489.4 million was due to the cost of goods sold from the
recently acquired Tyler refinery, $70.1 million was due to
the inclusion of a full nine months of results of operations
from the acquisition of Williamson Oil stores compared to only
five months in the nine months ended September 30, 2004,
and the majority of the remaining increase was due to an
increase in the average fuel price at our retail fuel and
convenience stores.
Refining Segment.
Cost of goods sold for our refining
segment was $489.4 million for the period from
April 29, 2005 through September 30, 2005,
approximating a cost per barrel sold of $59.97. This cost per
barrel resulted in a refining operating margin of
$99.8 million or $12.23 per barrel.
Retail Segment.
Cost of goods sold for our retail segment
was $691.0 million for the nine months ended
September 30, 2005, compared to $526.3 million for the
nine months ended September 30, 2004, an increase of
$164.7 million or 31.3%. This increase was primarily due to
a 25.4% increase in average retail fuel costs and
$70.1 million in cost of goods sold resulting from the
inclusion of a full nine months of results of operations from
the acquisition of Williamson Oil stores compared to only five
months in the nine months ended September 30, 2004.
Fuel cost of goods sold was $537.0 million for the nine
months ended September 30, 2005, compared to
$390.9 million for the nine months ended September 30,
2004, due to a 25.4% increase in retail fuel costs and a
23.8 million increase in gallons sold. Merchandise cost of
goods sold was $154.0 million for the nine months ended
September 30, 2005, compared to $135.4 million for the
nine months ended September 30, 2004. The increase in
merchandise cost of goods sold was primarily due to
$14.6 million in costs of goods sold resulting from the
inclusion of a full nine months of results of operations from
the acquisition of Williamson Oil stores compared to only five
months in the nine months ended September 30, 2004.
Operating Expenses
Operating expenses were $92.3 million for the nine months
ended September 30, 2005, compared to $58.3 million
for the nine months ended September 30, 2004, an increase
of $34.0 million or 58.3%. Of this increase,
$27.6 million was due to operating costs from the recently
acquired Tyler refinery, which approximated $3.39 per
barrel sold. In addition, we had $7.1 million in store
operating costs from the inclusion of a full nine months of
results of operations from the acquisition of Williamson Oil
stores compared to only five months in the nine months ended
September 30, 2004. The ratio of operating expenses to net
sales of our retail operations declined from 9.4% to 8.1% due to
higher sales per store driven by higher fuel prices and
continued expense controls.
General and Administrative Expenses
General and administrative expenses were $17.0 million for
the nine months ended September 30, 2005, compared to
$10.7 million for the nine months ended September 30,
2004, an increase of $6.3 million or 58.9%. This increase
was primarily due to additional salary and related expenses in
our retail segment due in part to the inclusion of a full nine
months of results of operations from the acquisition of
Williamson Oil stores compared to only five months in the nine
months ended September 30, 2004, and general and
administrative expenses from the acquisition of the Tyler
refinery.
Depreciation and Amortization
Depreciation and amortization were $11.5 million for the
nine months ended September 30, 2005, compared to
$8.7 million for the nine months ended September 30,
2004. This increase was primarily due to $0.8 million in
depreciation associated with the Tyler refinery along with
approximately $1.2 million in additional depreciation
resulting from the inclusion of a full nine months of
depreciation from the acquisition of Williamson Oil stores
compared to only five months in the nine months ended
September 30, 2004.
59
Table of Contents
(Gain) on Disposal of Assets
During the nine months ended September 30, 2005, we
recognized a net pre-tax gain of $1.6 million associated
with the sale of one convenience store partially offset by the
write-off of associated goodwill, compared to $0.2 million
pre-tax gain for the nine months ended September 30, 2004.
Loss on Forward Contract Activities
During August and September 2005, we entered into forward fuel
contracts to fix the purchase price of crude oil and sales price
of finished grade fuel for a predetermined number of units at a
future date, which had fulfillment terms of less than
60 days. We recorded unrealized losses of
$10.9 million during the nine months ended
September 30, 2005, which are included as losses on forward
contract activities. These contracts, which are no longer in
place, were entered into with an affiliate of Citigroup Global
Markets Inc., one of the underwriters of this offering.
Interest Expense, Net, Interest Expense-Related Party,
    Write-off of Deferred Financing Costs, (Gain) Loss on Derivative
    Instruments and Guarantee Fees
Interest expense, net was $10.8 million for the nine months
ended September 30, 2005, compared to $5.0 million for
the nine months ended September 30, 2004, an increase of
$5.9 million or 120.4%. This increase was due to increased
indebtedness and letter of credit fees associated with the
purchase of the Tyler refinery and higher short-term interest
rates. Interest expense from related party notes payable for the
nine months ended September 30, 2005 increased to
$2.3 million from $0.8 million in the nine months
ended September 30, 2004 due to borrowings incurred in
conjunction with the Tyler refinery acquisition. These increases
were partially offset by higher interest income due to higher
cash balances and by recording a $1.0 million increase in
unrealized gains on interest rate derivative instruments for the
nine months ended September 30, 2005, compared to an
unrealized loss of $0.9 million for the nine months ended
September 30, 2004.
We also wrote-off deferred financing charges of
$3.5 million in 2005 associated with the refinancing of a
portion of our long-term debt.
In the nine months ended September 30, 2005, we recorded a
$0.3 million expense in connection with guarantee fees
payable to Delek Group Ltd. relating to the guaranty of a
portion of our debt incurred in connection with the acquisition
of the Tyler refinery.
Income Tax Expense
Income tax expense was $22.4 million for the nine months
ended September 30, 2005, compared to $2.9 million for
the nine months ended September 30, 2004, an increase of
$19.5 million. This increase resulted from our higher
taxable income in 2005 compared to 2004.
Additionally, in connection with our acquisition of the Tyler
refinery, our consolidated effective tax rate decreased.
Substantially all of our refinery operations are conducted
through a Texas limited partnership, which is not subject to
Texas franchise tax. The limited partnership's 0.1% general
partner was subject to Texas franchise tax on its 0.1% share of
refining operations. Accordingly, the effective tax rate
applicable to our refining operations is the federal tax rate
plus a nominal amount of state franchise tax. Consequently, our
consolidated effective tax rate was reduced by our
refinery's proportionate contribution to our consolidated
pretax earnings. Our effective tax rate was 36.0% for the nine
months ended September 30, 2005, compared to 37.7% for the
first nine months of 2004.
60
Table of Contents
Year Ended December 31, 2004 Compared to Year Ended
    December 31, 2003
During the years ended December 31, 2004 and 2003, our
results include only our retail segment.
Net Sales
Net sales were $857.9 million for 2004, compared to
$600.2 million for 2003, an increase of $257.7 million
or 42.9%. The increase in net sales was primarily due to
$160.3 million in net sales from the purchase of the
Williamson Oil stores and an increase of 21.1% in average retail
fuel prices. Average retail fuel prices were $1.78 per
gallon for 2004, compared to average retail fuel prices of
$1.47 per gallon for 2003. Merchandise sales were
$54.2 million higher in 2004 primarily due to the
$42.0 million in net sales resulting from the Williamson
Oil acquisition and lottery revenues of $3.8 million, an
increase of $3.4 million, primarily due to the introduction
of the Tennessee lottery in early 2004.
Fuel Sales and Gallons.
Retail fuel sales were
    315.3 million gallons for 2004, compared to
    267.5 million gallons for 2003, an increase of
    47.8 million gallons. This increase was primarily due to
    44.9 million in gallons sold as a result of the acquisition
    of the Williamson Oil stores. Comparable store gallons decreased
    0.6%. Total fuel sales, including wholesale gallons, were
    $596.6 million for 2004, compared to $393.2 million
    for 2003, an increase of $203.4 million or 51.7%. The
    increase was primarily due to an increase of $0.31 per gallon in
    the average retail price per gallon ($1.78 per gallon
    compared to $1.47 per gallon) and $118.3 million in
    sales resulting from the acquisition of the Williamson Oil
    stores.
Merchandise Sales.
Merchandise sales were
    $261.2 million for 2004, compared to $207.0 million
    for 2003, an increase of $54.2 million or 26.2%. The
    primary reason for the increase in merchandise sales was
    $41.9 million from the Williamson Oil acquisition and an
    increase of $3.4 million in lottery commissions due to the
    introduction of the Tennessee lottery in early 2004. Comparable
    store merchandise sales increased 4.1%.
Cost of Goods Sold
Cost of goods sold was $730.8 million for 2004, compared to
$500.2 million for 2003, an increase of $230.6 million
or 46.1%. This increase was primarily due to $140.5 million
in cost of goods sold from the purchase of the Williamson Oil
stores and an increase of 23.5% in average retail fuel costs.
Fuel cost of goods sold was $546.4 million in 2004,
compared to $352.1 in 2003 due to a 23.5% increase in retail
fuel costs and a 67.9 million increase in gallons sold,
primarily due to the Williamson Oil acquisition. Merchandise
cost of goods sold was $184.3 million in 2004, compared to
$148,1 million in 2003, an increase of $36.2 million
or 24.4%. The increase in merchandise cost of goods sold was
primarily due to $29.9 million in cost of goods sold from
the Williamson Oil acquisition.
Operating Expenses
Operating expenses were $80.1 million for 2004, compared to
$62.7 million for 2003, an increase of $17.4 million
or 27.8%. This increase was primarily attributable to
$12.3 million in direct operating expenses associated with
the purchase of the Williamson Oil stores and higher credit card
fees associated with the higher retail price of gasoline.
General and Administrative Expenses
General and administrative expenses were $15.1 million for
2004, compared to $12.9 million for 2003, an increase of
$2.2 million or 17.1%. This increase was primarily due to
increased salaries and related expenses associated with the
addition of the Williamson Oil stores and higher insurance and
travel costs.
61
Table of Contents
Depreciation and Amortization
Depreciation and amortization were $12.4 million for 2004,
compared to $8.8 million for 2003, an increase of
$3.6 million or 40.9%. This increase resulted from
additions to property, plant and equipment as a result of
capital expenditures in 2004 and $2.3 million of
depreciation and amortization associated with assets purchased
in the Williamson Oil acquisition.
(Gain) on Disposal of Assets
During 2004, we recognized a gain of $0.9 million
associated with a gain on the sale of one convenience store and
disposal of various operational assets, compared to a gain of
$0.4 million on the sale of various operational assets in
2003.
Interest Expense, Net, Interest Expense-Related Party,
    Write-off of Deferred Financing Costs, (Gain) Loss on Derivative
    Instruments and Guarantee Fees
Interest expense, net was $7.1 million in 2004, compared to
$5.9 million in 2003, an increase of $1.0 million or
17.0%. This increase was primarily due to increased borrowings
as a result of the Williamson Oil acquisition. Interest expense
from related party notes payable was $1.2 million in 2004
compared to $0.1 million in 2003, an increase of
$1.1 million due to related party borrowings related to the
Williamson Oil acquisition. In addition, we recorded a non-cash
interest charge of $0.7 million in 2004 due to changes in
fair value of interest rate derivative instruments compared to a
$0.2 million gain in 2003.
Income Tax Expense
Income tax expense was $4.1 million in 2004, compared to
$3.8 million in 2003, an increase of $0.3 million or
7.9%. The increase in income tax expense was attributable to our
increased 2004 taxable income compared to 2003. Our effective
tax rate was 36.0% for 2004, as compared to 37.1% for 2003.
Year Ended December 31, 2003 Compared to Year Ended
    December 31, 2002
During the years ended December 31, 2003 and 2002, our
results include only our retail segment.
Net Sales
Net sales were $600.2 million for 2003, compared to
$549.6 million for 2002, an increase of $50.6 million
or 9.2%. This increase was primarily due to $38.4 million
in net sales from the purchase of eight retail fuel and
convenience stores in two separate transactions in February and
April of 2003 and a 21.1% increase in average retail fuel
prices. Average retail fuel prices were $1.47 per gallon
for 2003, compared to average retail fuel prices of
$1.29 per gallon for 2002.
Fuel Sales and Gallons.
Fuel sales were
    $393.2 million for 2003, compared to $345.1 million
    for 2002, an increase of $48.1 million or 13.9%. The
    increase was primarily due to an increase of $0.18 per gallon in
    the average retail price per gallon ($1.47 per gallon
    compared to $1.29 per gallon). Retail gallons were
    relatively unchanged in 2003 compared to 2002 at
    267.5 million gallons for 2003, compared to
    267.4 million gallons for 2002, with comparable store
    gallons decreasing 0.1%.
Merchandise Sales.
Merchandise sales were
    $207.0 million for 2003, compared to $204.5 million
    for 2002, an increase of $2.5 million or 1.2%. Comparable
    store merchandise sales dropped 3.1%, due to lower beer and
    cigarette sales.
Cost of Goods Sold
Cost of goods sold was $500.2 million for 2003, compared to
$460.3 million for 2002, an increase of $39.9 million
or 8.7%. This increase was primarily due to a $32.4 million
increase in cost of goods sold from the purchase of eight retail
fuel and convenience stores in two separate transactions in
February and April of 2003, and increases in average fuel costs
at these stores.
62
Table of Contents
Fuel cost of goods sold was $352.1 million in 2003,
compared to $310.5 million in 2002 due to a 13.4% increase
in retail fuel costs. Gallons sold were virtually unchanged
compared with 2002. Merchandise cost of goods sold was
$148.1 million in 2003, compared to $149.9 million in
2002. The increase in merchandise costs of goods sold was
primarily due to $6.2 million in cost of goods sold from
the foregoing purchase of eight retail fuel and convenience
stores, offset by lower cost of goods sold due to lower beer and
cigarette sales.
Operating Expenses
Operating expenses were $62.7 million in 2003, compared to
$62.1 million in 2002, an increase of $0.6 million or
1.0%. This change was primarily attributable to
$3.6 million increase in the operating expenses resulting
from the purchase of eight retail fuel and convenience stores in
two separate transactions in February and April of 2003, offset
by decreases of approximately $2.8 million in advertising,
salaries and outside services expenses.
General and Administrative Expenses
General and administrative expenses were $12.9 million for
2003, compared to $12.2 million in 2002, an increase of
$0.7 million or 5.7%. This increase was primarily
attributable to higher salaries and professional expenses and
$0.2 million in general and administrative expenses from
the purchase of the eight retail fuel and convenience stores
described above.
Depreciation and Amortization
Depreciation and amortization were $8.8 million for 2003,
compared to $7.4 million for 2002, an increase of
$1.4 million or 18.9%. This increase was primarily the
result of additional depreciation resulting from the increase in
property, plant and equipment related to our purchase of the
eight retail fuel and convenience stores described above.
(Gain) on Disposal of Assets
During 2003, we recognized a gain of $0.4 million on the
sale of various operational assets. There were no gains on
disposal of assets in 2002.
Interest Expense, Net, Interest Expense-Related Party,
    Write-off of Deferred Financing Costs, (Gain) Loss on Derivative
    Instruments and Guarantee Fees
Interest expense, net was $5.9 million in 2003, compared to
$5.7 million in 2002, an increase of $0.2 million or
3.5%. Interest expense from related party notes payable was
$0.1 million in 2003 compared to zero in 2002. We also
recognized a $0.2 million gain on derivative instruments in
2003, compared to a $2.6 million loss on derivative
instruments in 2002.
Income Tax Expense
Income tax expense was $3.8 million in 2003, compared to an
income tax benefit of $0.3 million in 2002, a change of
$4.1 million. The change in income tax expense was
attributable to our generating 2003 taxable income compared to
our incurring a loss in 2002. Our effective tax rate was 37.1%
for 2003, compared to 35.8% for 2002.
Liquidity and Capital Resources
Our primary sources of liquidity are cash generated from our
operating activities and borrowings under our revolving credit
facilities and from related parties. We believe that our cash
flows from operations, borrowings under our revolving credit
facilities, proceeds from this offering and other capital
resources will be sufficient to satisfy the anticipated cash
requirements associated with our existing operations during the
next 12 months. However, our future capital expenditures
and other cash requirements could be higher than
63
Table of Contents
we currently expect as a result of various factors, including
any expansion of our business that we may complete. See
"Risk Factors."
Cash Flows
The following table sets forth a summary of our consolidated
cash flows for the years ended December 31, 2002, 2003 and
2004 and the nine months ended September 30, 2004 and 2005:
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004
2004
2005
(Dollars in thousands)
Cash flows provided by (used in) operating activities
$
17,528
$
26,333
$
24,926
$
16,218
$
139,230
Cash flows provided by (used in) investing activities
(12,066
)
(16,149
)
(27,343
)
(26,763
)
(83,588
)
Cash flows provided by (used in) financing activities
(4,465
)
(2,242
)
5,616
13,962
69,279
Net (decrease) increase in cash and cash equivalents
$
997
$
7,942
$
3,199
$
3,417
$
124,921
Cash Flows Provided By (Used In) Operating Activities
Net cash provided by operating activities was
$139.2 million for the nine months ended September 30,
2005, compared to $16.2 million for the nine months ended
September 30, 2004. The most significant sources of cash
from operating activities in the first nine months of 2005 were
our increased net income from the Tyler refinery and increased
accounts payable due to crude oil purchases for our refinery,
partially offset by increases in accounts receivable.
Net cash provided by operating activities was $24.9 million
for 2004, compared to net cash provided by operating activities
of $26.3 million for 2003. Operating cash flows for 2004
were primarily attributable to net income of $7.3 million,
and increases in accounts payable due to higher retail fuel
costs.
Net cash provided by operating activities was $26.3 million
for 2003, compared to $17.5 million for 2002. Operating
cash flows for 2003 were primarily attributable to net income of
$6.5 million and an increase in accounts payable due to
higher retail fuel costs. Operating cash flows for 2002 were
primarily attributable to increases in accounts payable and
interest payable, partially offset by an increase in inventories
and accounts receivable.
Cash Flows Provided By (Used In) Investing Activities
Net cash used in investing activities was $83.6 million for
the nine months ended September 30, 2005, compared to
$26.8 million for the nine months ended September 30,
2004. This difference was primarily due to the purchase of the
assets of the Tyler refinery for approximately
$73.1 million (including transaction costs) and capital
expenditures of $8.4 million, partially offset by proceeds
from the sale of retail fuel and convenience store assets of
$3.1 million. Capital expenditures in the nine months ended
September 30, 2005 included $3.2 million for projects
at the Tyler refinery, with the remaining capital spent in our
retail fuel and convenience stores for improvements, equipment,
new store development and information technology.
Net cash used in investing activities increased to
$27.3 million in 2004 from $16.1 million during 2003.
Our primary investments in 2004 included $22.2 million for
the cash portion of the purchase price (including transaction
costs) for the Williamson Oil stores. Capital expenditures for
2004 totaled $7.0 million spent in our retail fuel and
convenience stores for improvements, equipment, new store
development and information technology. These expenditures were
partially offset by $1.8 million in proceeds received from
retail fuel and convenience store asset disposals.
64
Table of Contents
Net cash used in investing activities increased to
$16.1 million in 2003 from $12.1 million during 2002.
Our primary investments in 2003 included $12.2 million for
the purchase of retail fuel and convenience store assets and
capital expenditures of $5.2 million. These expenditures
were partially offset by $1.2 million in proceeds received
from retail fuel and convenience store asset disposals.
Cash Flows Provided By (Used In) Financing Activities
Net cash provided by financing activities was $69.3 million
during the nine months ended September 30, 2005, compared
to $14.0 million during the nine months ended
September 30, 2004. Cash provided from financing activities
included net proceeds received as a result of refinancing term
and revolver borrowings of $40.0 million through a
revolving credit facility and a $165.0 million term loan,
as well as $50.0 million in proceeds received from notes
issued in connection with the Tyler refinery purchase. Cash
provided by financing activities in 2005 also reflected a
subordinated loan of $35.0 million received from Delek
Group Ltd. Cash used in financing activities included
$13.8 million of financing costs paid in connection with
new debt issuance, debt repayments of $174.1 million and
payments made under capital lease obligations.
Net cash provided by financing activities was $5.6 million
in 2004, compared to net cash used in financing activities of
$2.2 million in 2003. The cash provided was primarily
attributable to additional borrowings used to finance the
Williamson Oil acquisition, partially offset by the payment of
additional financing costs and the purchase of interest rate
derivatives. Cash provided included borrowings made under a new
$34.5 million term loan facility, a $6.0 million
revolving line of credit and a subordinated loan of
$25.0 million received from Delek - The Israel Fuel
Corporation Ltd., most of which were used to finance a portion
of the Williamson Oil acquisition.
Net cash used in financing activities was $2.2 million in
2003, compared to $4.5 million in 2002. The use of cash in
2003 reflected the reduction in our net borrowings under a term
loan and an increase in restricted cash, the majority of which
was to be used to acquire replacement assets. Cash provided by
financing activities in 2003 reflected an increase in our net
borrowings under a new term loan used to partially finance a
portion of the purchase of eight retail fuel and convenience
stores.
Cash Position, Working Capital and Indebtedness
As of September 30, 2005, our total cash and cash
equivalents were $147.0 million and we had total
indebtedness of approximately $282.7 million. Working
capital was $108.6 million at September 30, 2005,
compared to $(8.7) million at December 31, 2004, an
increase of $117.3 million. This increase was primarily due
to $86.8 million in net working capital from our Tyler
refinery operations, including $121.1 million of cash and a
$21.7 million reduction in current maturities of long-term
debt due to the refinancing of certain debt obligations
completed in April 2005.
65
Table of Contents
Summary of Indebtedness.
Outstanding borrowings under our
existing debt instruments and capital lease obligations at
September 30, 2005 were as follows:
September 30, 2005
(Dollars in
thousands)
Notes payable to related parties
$60,000
Senior secured credit facility — term loan
164,588
Senior secured credit facility — revolver
8,000
Israel Discount Bank note
30,000
Bank Leumi note
20,000
Other notes payable
90
282,678
Less:
Current portion of long-term debt
(1,650
)
Current portion of other notes payable
(46
)
$
280,982
Notes Payable to Related Parties.
On April 28,
2004, we signed a note payable to Delek – The Israel
Fuel Corporation Ltd. in the principal amount of
$25.0 million. Proceeds from the note were used to
partially fund the purchase of the Williamson Oil stores. The
note bears interest at a rate of 6.30% per year with
interest and principal payments due upon maturity on
April 27, 2008.
On April 27, 2005, to partially finance our purchase of our
refinery, we signed a note payable to Delek Group Ltd. in the
principal amount of $35.0 million. The note bears interest
at a rate of 7.0% per year, which is due and payable in
semi-annual installments, commencing July 1, 2007. The
entire principal amount plus accrued and unpaid interest is due
upon maturity on April 27, 2010. On November 23, 2005,
we repaid $17.5 million of the principal and all accrued
interest through that date under the note.
Senior Secured Credit Facility.
On April 28, 2005,
we executed our senior secured credit facility with a syndicate
of lenders and Lehman Commercial Paper Inc., an affiliate of
Lehman Brothers Inc., one of the underwriters of this offering,
serving as administrative agent. In connection with the
execution of the amended and restated agreement, we consolidated
certain of our borrowings under our existing credit agreement
and asset-backed loan agreement into a single credit facility
and increased the borrowing capacity available under the
facility to $205.0 million.
The senior secured credit facility consists of a
$40.0 million revolving credit facility and a
$165.0 million term loan. Borrowings under the senior
secured credit facility are secured by substantially all the
assets of MAPCO Express, Inc. and its subsidiaries. Letters of
credit outstanding under the facility totaled $7.9 million
as of September 30, 2005. In December 2005, we increased
commitments under our senior secured credit facility revolver by
$30.0 million to $70.0 million, and subsequently
borrowed $30.0 million in connection with our acquisition
of retail fuel and convenience stores and other assets from BP.
The senior secured credit facility term loan requires quarterly
principal payments of approximately 0.25% of the principal
balance through March 31, 2011 and a balloon payment of
approximately 94.25% of the principal balance due upon maturity
on April 28, 2011. The senior secured credit facility
revolver is payable in full upon maturity on April 28, 2010
with periodic interest repayment requirements. The senior
secured credit facility term and senior secured credit facility
revolver loans bear interest based on predetermined pricing
grids which allow us to choose between a "Base Rate"
or "Eurodollar" loan. Interest is payable quarterly
for Base Rate loans and for the applicable interest period on
Eurodollar loans. As of September 30, 2005, the weighted
average borrowing rate was 6.7% for the senior secured credit
facility term loan and 6.4% for the senior secured credit
facility revolver. Additionally, the senior secured credit
facility requires us to pay a quarterly fee of 0.5% per
year on the average available revolving commitment. Amounts
66
Table of Contents
available under the senior secured credit facility revolver as
of September 30, 2005 totaled approximately
$24.1 million.
We are required to comply with certain financial and
non-financial covenants under the senior secured credit
facility. We believe we were in compliance with all covenant
requirements at September 30, 2005.
SunTrust ABL Revolver.
On April 29, 2005, we entered
into a $250.0 million asset-based senior revolving credit
facility with a syndicate of lenders led by SunTrust Bank as
administrative agent to finance ongoing working capital, capital
expenditures and general needs of the Tyler refinery. This
agreement, as amended on May 2, 2005 and as of
October 1, 2005, which we refer to as the SunTrust ABL
revolver, matures on April 29, 2009 and bears interest
based on predetermined pricing grids that allow us to choose
between a "Base Rate" or "Eurodollar" loan.
Interest is payable quarterly for Base Rate loans and for the
applicable interest period on Eurodollar loans. Availability
under the SunTrust ABL revolver is determined by a borrowing
base defined in the SunTrust ABL revolver, supported primarily
by cash, certain accounts receivable and inventory.
In addition, the SunTrust ABL revolver supports our issuances of
letters of credit used primarily in connection with the
purchases of crude oil for use in our refinery that at no time
may exceed the aggregate borrowing capacity available under the
SunTrust ABL revolver. As of September 30, 2005, we had no
outstanding borrowings under the agreement but had letters of
credit outstanding totaling approximately $178.0 million.
Amounts available under the SunTrust ABL revolver as of
September 30, 2005 totaled $72.0 million.
The SunTrust ABL revolver contains a negative covenant that
prohibits us from creating, incurring or assuming any liens,
mortgages, pledges, security interests or other similar
arrangements against the property, plant and equipment of the
refinery, subject to customary exceptions for certain permitted
liens.
Under the SunTrust ABL revolver, we are also subject to certain
other financial and non-financial covenants. We believe we were
in compliance with all covenant requirements at
September 30, 2005.
Israel Discount Bank Note.
On April 26, 2005, we
signed a $30.0 million promissory note payable to Israel
Discount Bank of New York. The proceeds of this note were used
to partially fund a portion of the Tyler refinery acquisition.
This note matures on April 30, 2007, and bears interest,
payable quarterly, at a spread of 1.375% per year over the
90-day
London Inter
Bank Offering Rate, or LIBOR, with the first interest payment
due on April 30, 2006. As of September 30, 2005, the
weighted average borrowing rate on this note was 5.04%. This
note is guaranteed by Delek Group Ltd. See "Certain
Relationships and Related Transactions — Guarantees by
Affiliates."
Bank Leumi Note.
On April 27, 2005, we signed a
$20.0 million promissory note payable to Bank Leumi USA.
The proceeds of this note were used to partially fund a portion
of the Tyler refinery acquisition. This note matures on
April 27, 2007, and bears interest at a spread of
1.375% per year over the LIBOR Rate (Reserve Adjusted) for
a three month term, with the first interest payment due in April
2006. As of September 30, 2005, the weighted average
borrowing rate on this note was 5.06%. This note is guaranteed
by Delek Group Ltd. See "Certain Relationships and Related
Transactions — Guarantees by Affiliates."
Letters of Credit.
As of September 30, 2005, in
addition to letters of credit totaling $185.9 million
outstanding under the SunTrust ABL revolver and senior secured
credit facility revolver mentioned above, we had letters of
credit for fuel purchases totaling $9.5 million issued in
our favor by Delek – The Israel Fuel Corporation Ltd.
See "Certain Relationships and Related
Transactions — Guarantees by Affiliates."
67
Table of Contents
Capital Spending
Our capital expenditures for the nine months ended
September 30, 2005 were approximately $8.4 million, of
which approximately $5.2 million was spent in our retail
segment, and approximately $3.2 million was spent in our
refining segment. Our capital expenditure budgets for 2006 and
2007 are approximately $77.4 million and
$58.2 million, respectively. The following table summarizes
our expected capital expenditures for 2006 and 2007 by operating
segment and major category.
2006
2007
(Dollars in thousands)
Retail:
Sustaining maintenance
$5,000
$5,175
Growth/profit improvement
4,500
4,658
Retrofit/rebrand/remodel
2,750
5,025
Raze and rebuild
7,313
7,700
New construction
12,000
16,500
Total retail
31,563
39,058
Refining:
Sustaining maintenance
12,716
6,470
Environmental (see explanation below)
28,445
10,235
Turnarounds
—
—
Discretionary projects
4,641
2,400
Total refinery
45,802
19,105
Total capital spending
$
77,365
$
58,163
Environmental Capital Expenditures.
We expect to spend
approximately $26.7 million between 2006 and the end of
2007 to comply with the federal Clean Air Act regulations
requiring a reduction in sulfur content in gasoline and diesel
fuel. In addition, we expect to spend approximately
$14.3 million for other environmental projects through
2010, including approximately $6.7 million for purchasing
and installing a sulfur recovery unit and approximately
$3.0 million for a new electrical substation to comply with
a proposed consent decree with the U.S. Department of
Justice and the EPA. The estimated environmental capital
expenditures described above are summarized in the table below.
2006
2007
2008
2009
2010
Total
(Dollars in thousands)
Low-sulfur gasoline
$2,500
$9,485
$
—
$
—
$
—
$
11,985
Low-sulfur diesel
14,668
—
—
—
—
14,668
Electrical substation
2,964
—
—
—
—
2,964
Sulfur recovery unit
6,650
—
—
—
—
6,650
Other environmental
1,663
750
750
750
750
4,663
Totals
$
28,445
$
10,235
$
750
$
750
$
750
$
40,930
Turnarounds.
Our refinery's prior owner completed a
turnaround in February 2005. We completed a supplementary
turnaround in December 2005 that involved the fluid catalytic
cracking unit, sulfuric acid alkylation unit, sulfur recovery
unit and treating units at a cost of approximately
$10.0 million. No further major turnarounds are planned
until 2009, with the costs of these future turnarounds estimated
to be approximately $20.0 million.
68
Table of Contents
Contractual Obligations and Commitments
Information regarding our known contractual obligations of the
types described below as of September 30, 2005, is set
forth in the following table. We did not have any capital lease
obligations as of September 30, 2005.
<1 Year
1-3 Years
3-5 Years
>5 Years
Total
(Dollars in thousands)
Long-term debt obligations
$1,696
$78,344
(1)
$
46,300
(2)
$
156,338
$
282,678
Interest(3)
14,227
24,237
21,782
6,142
66,388
Operating lease obligations(4)
9,274
26,046
25,534
89,932
150,786
Total
$
25,197
$
128,627
$
93,616
$
252,412
$
499,852
(1)
Does not reflect $20.0 million in principal prepayments
    made to Bank Leumi USA and Israel Discount Bank on
    November 23, 2005.
(2)
Does not reflect $17.5 million in principal prepayments
    made to Delek Group Ltd. on November 23, 2005 and
    $30.0 million in borrowings used to fund our acquisition of
    retail fuel and convenience stores and other assets from BP in
    December 2005.
(3)
Includes expected payments on credit facilities in place at
    September 30, 2005. Variable interest is set at
    September 30, 2005 rates.
(4)
Amounts reflect future estimated lease payments, including
    renewal options for leases we have determined are reasonably
    assured, under operating leases having remaining noncancelable
    terms in excess of one year as of September 30, 2005.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Quantitative and Qualitative Disclosure About Market Risk
Changes in commodity prices (mainly crude oil and gasoline) and
interest rates are our main sources of market risk. We manage
these risks based on the assessment of our management.
Commodity Price Risk.
Sudden change in petroleum prices
is our main source of market risk. Our business model is
affected more by the volatility of petroleum prices than by the
cost of the petroleum that we sell. We manage these risks based
on the assessment of our management and we use hedging
strategies from time to time.
In order to manage the uncertainty relating to inventory price
volatility, we have consistently applied a policy of maintaining
inventories at or below a targeted operating level. In the past,
circumstances have occurred, such as timing of crude oil cargo
deliveries, turnaround schedules or shifts in market demand that
have resulted in variances between our actual inventory level
and our desired target level. We may utilize the commodity
futures market to manage these anticipated inventory variances.
In accordance with SFAS No. 133, all commodity futures
contracts are recorded at fair value, and any change in fair
value between periods has historically been recorded in the
profit and loss section of our consolidated financial statements.
We are exposed to market risks related to the volatility of
crude oil and refined petroleum product prices, as well as
volatility in the price of natural gas used in our refinery
operations. Our financial results can be affected significantly
by fluctuations in these prices, which depend on many factors,
including demand for crude oil, gasoline and other refined
petroleum products, changes in the economy, worldwide production
levels, worldwide inventory levels and governmental regulatory
initiatives. Our risk management strategy identifies
circumstances in which we may utilize the commodity futures
market to manage risk associated with these price fluctuations.
At September 30, 2005, we had open contracts covering a
portion of our
69
Table of Contents
September and October 2005 production of unleaded gasoline
(approximately 0.7 million barrels). We recorded unrealized
losses of $10.9 million during the nine month period ended
September 30, 2005, in conjunction with these contracts.
These contracts, which have expired, were entered into with an
affiliate of Citigroup Global Markets Inc., one of the
underwriters of this offering.
We maintain at our refinery and in third-party facilities
inventories of crude oil, feedstocks and refined petroleum
products, the values of which are subject to wide fluctuations
in market prices driven by world economic conditions, regional
and global inventory levels and seasonal conditions. As of
September 30, 2005, we held approximately 1.0 million
barrels of crude and product inventories valued under the LIFO
valuation method with an average cost of $54.40 per barrel.
Market value exceeded carrying value of LIFO costs by
$27.3 million. We refer to this excess as our LIFO reserve.
Interest Rate Risk.
We have market exposure to changes in
interest rates relating to our outstanding variable rate
borrowings, which totaled $222.6 million as of
September 30, 2005. We help manage this risk through a
combination of interest rate swap and cap agreements that modify
the interest characteristics of our outstanding long-term debt.
In accordance with SFAS No. 133, all interest rate
hedging instruments are recorded at fair value and any changes
in the fair value between periods are recognized in earnings.
The fair value of our interest rate hedging instruments
increased by $1.0 million for the nine months ended
September 30, 2005.
The fair values of our interest rate swaps and cap agreements
are obtained from dealer quotes. These values represent the
estimated amount that we would receive or pay to terminate the
agreement taking into account the difference between the
contract rate of interest and rates currently quoted for
agreements, of similar terms and maturities. We expect the
interest rate derivatives will reduce our exposure to short-term
interest rate movements. The annualized impact of a hypothetical
1% change in interest rates on floating rate debt outstanding as
of September 30, 2005 would be to change interest expense
by $2.2 million. Increases in rates would be partially
mitigated by interest rate derivatives mentioned above. As of
September 30, 2005, we had $3.2 million of swap
agreements in place, which expired in January 2006. The weighted
average pay rate under these swaps was 5.15%. We also have
interest rate cap agreements in place representing
$135.0 million in notional value at September 30, 2005
with various settlement dates, the latest of which expires in
July 2010. These interest rate caps range from 3.50% to 4.00%
and include a knock-out feature at rates ranging from 6.50% to
7.15%. The fair value of our interest rate derivatives was
$2.9 million as of September 30, 2005.
70
Table of Contents
OUR INDUSTRY
Refining Industry Overview
Oil refining is the process of separating hydrocarbon compounds
present in crude oil and converting them into refined petroleum
products, such as gasoline and diesel fuel. Refining is
primarily a margin-based business where both the feedstocks and
refined petroleum products are commodities. Refiners create
value by selling refined petroleum products at prices higher
than the costs of acquiring crude oil and converting it into
refined petroleum products.
The U.S. oil refining industry has undergone significant
consolidation in the past ten years. The corporate
mergers/acquisitions of integrated majors such as BP Arco and
Amoco, Exxon and Mobil, Phillips with both Tosco and Conoco and
Chevron and Texaco are examples of the consolidation that has
occurred. Additionally, the emergence of independent refiners as
consolidators such as Valero, which owned only one refinery in
1994 and now owns 17 U.S. refineries, has contributed to
the trend. In 1994, the ten largest refiners, by capacity, owned
approximately half of the total refining capacity in the United
States. By 2004, the top ten U.S. refiners, by capacity,
owned approximately 71% of total refining capacity.
The differential in price between a representative barrel of
benchmark refined petroleum products, such as gasoline or
heating oil, and a barrel of benchmark crude oil is known as a
crack spread. The US Gulf Coast 5-3-2 crack spread represents
the differential between Platt's quotations for
3
/
5
of a barrel of US Gulf Coast Pipeline 87 Octane Conventional
Gasoline and
2
/
5
of a barrel of US Gulf Coast Pipeline No. 2 Heating Oil
(high sulfur diesel), on the one hand, and the first month
futures price of
5
/
5
of a barrel of light sweet crude oil on the New York Mercantile
Exchange, on the other hand.
The following chart shows the one-year average together with the
rolling five-year average of the US Gulf Coast 5-3-2 crack
spreads since 1996:
Strong Demand for Refined Petroleum Products
According to the Department of Energy's Energy Information
Administration, or EIA, total U.S. demand for refined
petroleum products increased 2.4% from 2003 to 2004, due
primarily to an improving economy
71
Table of Contents
and a continued increase in the number of higher gasoline
consumption vehicles driven by U.S. consumers. At the same
time, gasoline supplies have tightened due to more stringent
fuel specifications. These factors have caused refining margins
in 2004 and 2005 to substantially exceed those experienced in
2003.
Growth in refining capacity is expected to
average 1.3% per year over the next two decades
according to the EIA. The EIA projects demand for refined
petroleum products to continue to grow at an average of
1.5% per year over this period and to outpace capacity
growth. Approximately 92% of the projected demand growth is
expected to come from the increased consumption of light
petroleum products, including gasoline, diesel, jet fuel and
liquified petroleum gas, which are more difficult and costly to
produce than heavy petroleum products.
Limited U.S. Refining Capacity
According to the EIA, the number of operable
U.S. refineries has decreased from 319 in 1980 to 148 in
2005. Also according to the EIA, while domestic refining
capacity has decreased approximately 6%, from 6.6 billion
barrels per year in 1980 to 6.2 billion barrels per year in
2005, domestic demand for refined fuels has increased 27.1%,
from 5.9 billion barrels to 7.5 billion barrels, over
the same period.
Petroleum refining is subject to extensive environmental
regulation in the United States. No new refinery has been
constructed in the United States since 1976. We believe that
high capital costs and environmental regulatory requirements
have limited the growth of refining capacity, the construction
of new refineries and the expansion of existing refineries in
the United States over the past 30 years. Domestic
refineries are subject to several major federal environmental
programs, including those administered under the Resource
Conservation and Recovery Act, the Clean Air Act and the Clean
Water Act. Additionally, new fuel specification requirements
(such as the Tier II (low sulfur) gasoline, on-road
ultra-low sulfur diesel, non-road locomotive and marine
ultra-low sulfur diesel, methyl tertiary butyl ether, or MTBE,
phase-out and ethanol mandates) and New Source Review revisions
will require refining companies to continue to make substantial
capital investments in domestic refineries over the next five
years and beyond.
High Utilization Rates
Between 1982 and 2004, refinery utilization increased from 69%
to over 92%. The EIA projects that utilization will remain high
relative to historic levels, ranging from 92% to 95% of design
capacity. The trend toward greater capacity utilization has been
driven by several factors, including those discussed above.
72
Table of Contents
The following chart displays the number of operable refineries
in the United States, historically compared to the average
utilization rate in the industry.
Significant Dependence on Imports
Due to the lack of sufficient domestic refining capacity, the
United States is a net importer of refined petroleum products.
Imports accounted for almost 14% of total U.S. consumption
of refined petroleum products in 2004. Import volumes generally
increase when prices for refined petroleum products are
materially higher in the United States than in international
markets. In the future, imported refined petroleum products will
be required to meet new, more stringent fuel specifications
applicable to the U.S. market. Many foreign refiners do not
currently possess the capabilities to blend and process fuels
that meet these specifications, which could put further pressure
on the domestic supply and demand environment.
Varying Product Specifications Complicate
    Distribution
Regulatory requirements for fuel specifications vary by city,
county, state and region. Due to these varying specification
requirements, disruptions in one region cannot necessarily be
alleviated by importing product from another region. For
example, a Houston, Texas refiner may have large batches of
gasoline prepared for shipment on the Colonial Pipeline to the
East Coast. If the Colonial Pipeline were to become
non-operational due to a hurricane in Louisiana or some other
event, the refinery may become backlogged because the
specifications of the gasoline in storage do not meet the local
specifications or those of other pipelines for shipment to other
areas of the United States.
The EPA will require production of ultra-low sulfur diesel fuel
beginning in June 2006. The introduction of ultra-low sulfur
diesel will further complicate fuel distribution, because extra
care must be taken in shipping ultra-low sulfur diesel to avoid
contamination. The introduction of new ultra-low sulfur diesel
is expected to result in short-term supply disruptions.
73
Table of Contents
Vulnerability of Energy Infrastructure
The major refining center in the United States is located in the
Gulf Coast region in an area classified by the federal
government as the Petroleum Administration for Defense District,
or PADD, III (Alabama, Arkansas, Louisiana, Mississippi,
New Mexico and Texas). The total refining capacity in
PADD III as of January 1, 2006 is 8.3 million
barrels per day, representing 49% of total U.S. refining
capacity. Normally, over 50% of the products refined in
PADD III are exported to other areas of the country through
an extensive network of pipelines, ships and barges. The primary
recipients of these shipments are in the East Coast PADD I
(Connecticut, Delaware, District of Columbia, Florida, Georgia,
Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New
York, North Carolina, Pennsylvania, Rhode Island, South
Carolina, Vermont, Virginia, and West Virginia) and the Midwest
PADD II (Illinois, Indiana, Iowa, Kansas, Kentucky,
Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio,
Oklahoma, South Dakota, Tennessee, Wisconsin). The geographic
concentration of refineries in PADD III makes the refining
and marketing infrastructure, and consequently the supply of
refined petroleum products to major consuming regions, more
vulnerable to natural disasters and concentrated terror attacks
on the U.S. Gulf Coast.
For example, when Hurricanes Rita and Katrina hit Texas and
Louisiana in September 2005, product exports from PADD III
dropped by almost one million bpd, or approximately 21%, due to
refinery shutdowns, pipeline shutdowns, power outages, shipping
disruptions, operating personnel dislocations and other factors.
Convenience Store Industry Overview
What is a convenience store
The National Association of Convenience Stores, or NACS, defines
a convenience store as a retail business with a primary emphasis
placed on providing the public with a convenient location to
quickly purchase from a wide array of consumable products
(predominantly food or food and gasoline) and services.
Convenience stores have the following characteristics:
•
Building size may vary significantly — typically
    between 1,000 and 5,000 square feet;
•
Off-street parking and/or convenient pedestrian access;
•
Extended hours of operation with many open 24 hours a day,
    seven days a week;
•
Stock of at least 500 SKUs (stock-keeping units);
•
Product mix includes grocery-type items and items from the
    following groups: beverages, snacks (including confectionery)
    and tobacco; and
•
Approximately 81% sell gasoline.
Industry Overview
According to NACS, the convenience store industry generated
$394.7 billion in revenues and $4.9 billion in income
before income taxes in 2004 compared to $337 billion in
revenues and $4.0 billion in income before income taxes in
2003. Total industry sales have grown at a
5-year
compounded
annual growth rate, or CAGR, of 11.0%. In 2004, there were
approximately 138,000 convenience stores in the United States,
resulting in average revenues per site of $3.3 million and
average gross margin per site of $448,507. The market is highly
fragmented, with the top 100 companies, ranked by sales,
accounting for only 32% of total industry sales.
The industry is comprised of two major categories of sales:
in-store sales and fuel sales. In-store sales consist of
cigarettes, beverages, food service, snacks and general
merchandise. Fuel sales consist primarily of gasoline, but also
include small percentages of diesel, propane and other refined
petroleum products.
74
Table of Contents
Highly Fragmented Industry
The convenience store industry continues to be dominated by
small, "independent" operators. According to the NACS,
approximately 66% of all convenience stores in the United States
are operated by companies that operate less than ten stores. A
substantial majority are single store operators. On the other
hand, stores operated by companies with 500 or more stores
accounted for only about 12% of all convenience stores.
In-Store Sales
In 2004, the convenience store industry derived approximately
one-third
of total
sales from in-store merchandise, with the remainder coming from
fuel sales. However, in-store merchandise typically accounts for
a much higher portion of the total gross margin
dollars – approximately 68%. Industry historical
percentage of in-store sales and gross margins for the top ten
in-store merchandise categories (excluding lottery) are listed
below:
Cigarettes are the leading product category for convenience
store in-store sales, accounting for approximately 35% of
in-store sales in 2004. Convenience stores dominate the market
for cigarette sales, growing to approximately 62% of the market
in 2004, compared to approximately 54% in 1999.
The eight southeastern states in which we operate have some of
the highest smoking rates and lowest tax rates for cigarette
sales in the United States. As reflected in the table below,
five of these states (listed in bold) — Kentucky,
Tennessee, Arkansas, Alabama and Mississippi — are
within the top ten states in terms of percentage of population
that smokes. Five of the states — Kentucky, Louisiana,
Mississippi, Tennessee and Virginia — also have state
laws protecting the rights of smokers. In addition, as reflected
in the table below, five of the states — Kentucky,
Louisiana, Mississippi, Tennessee and Virginia — are
among the ten states with the lowest cigarette taxes.
75
Table of Contents
Non-alcoholic packaged beverages consist of carbonated soft
drinks, ready-to-drink iced teas, sports drinks, juice and juice
drinks, bottled water and alternative beverages. Growth in the
packaged beverages category was driven by alternative beverages,
sports drinks, ready-to-drink iced teas and bottled water. While
the percentage of in-store sales attributable to food service
declined between 2003 and 2004, the gross margin contribution of
food service was higher due to the increased percentage of food
prepared on site (from 42.3% to 46.6%) as well as an increase in
sales and margin in cold dispensed beverages.
Fuel Sales
NACS estimates that convenience stores sell three-quarters of
all the gasoline purchased in the United States. Fuel sales as a
percentage of total industry sales have grown from approximately
61.4% in 2000 to 66.5% in 2004. The industry's motor fuels
sales jumped 18.9% to reach $262.6 billion for a total of
143.5 billion gallons in 2004. However, gasoline revenue is
a function of the retail price of gasoline, which can vary
widely without impacting the profitability of the convenience
store industry.
According to the EIA, the United States consumed approximately
9.1 million bpd (139.0 billion gallons per year) of
gasoline in 2004. National gasoline demand growth has been
fairly steady over the past ten years and has grown at a CAGR of
1.7%. Over the past ten years, gasoline demand in the Southeast
has outpaced the national average, with demand having grown at a
CAGR of 2.2%.
Gross margins for a retail fuel outlet are typically expressed
in a
"rack-to
-retail"
margin, which is the differential between the prices quoted at
refinery fueling stations, or racks, and the price sold to the
end consumer, net of gasoline sales taxes. The
rack-to
-retail margin
averaged $0.147 per gallon in 2005. The following table displays
industry fuel margins in the southeast region of the United
States since 1996.
76
Table of Contents
Fuel margins in the states in which we operate have averaged
$0.119 per gallon over the last ten years and fell in a
normalized range of approximately $0.100 to $0.137 per gallon.
Due to world crude supply and demand fundamentals, domestic fuel
inventories and domestic refining capacity, 1999 was one of the
worst years in recent history for retail margins, with average
fuel margins in our core market 16.0% below the ten-year
average. The market recovered in 2000, with margins increasing
14.1% over 1999. Between 2000 and 2005, fuel margins in our
market have steadily improved, increasing 34.2%, with margins
averaging $0.153 per gallon in 2005.
Technology
We believe that technology and scale are becoming increasingly
important competitive differentiators for convenience store
operators. In a recent study conducted by NACS, 24% of the
respondents indicated that IT spending as a percentage of total
capital spending was over 20% for their respective companies.
Given the highly fragmented nature of the industry, operators
with the capacity to invest in substantial technological
improvements are expected to gain an advantage over their
competitors. These developing technology platforms are most
likely to benefit larger operators since they are generally
better capitalized to make investments in technology.
Potential advantages from greater technology investment are
improved merchandising and promotional activity, increased
operating efficiency, more efficient inventory management, and
better, closer supplier relationships. New technology will help
to improve the speed and options of payment and reduce customer
wait times, which should enhance customer relations.
77
Table of Contents
Recent Trends
Food Service
Increased work and travel demands have led American consumers to
eat out more often and to seek food service offerings that
conveniently provide fresher, higher quality foods. In 2004,
food service represented approximately 12% of in-store sales and
generated margins of 37% to 56%. Food service has been an
expanding category in the industry, with major convenience store
chains using the concept to build upon and improve the
profitability of the traditional convenience store layout.
To meet consumer demand and to diversify their product offerings
away from the volatility and margin pressure of gasoline sales
and heavy reliance on tobacco products, many convenience stores
are now introducing Quick Service Restaurants, or QSRs, into
their product offerings at many of their locations. The
restaurants are either incorporated within the convenience store
plan as a kiosk or co-located with a more traditional full-size
restaurant format.
The introduction of QSRs offers two advantages: QSRs draw
incremental customer traffic to the location with their
increased service offering, and they increase average sales with
higher gross margin products, resulting in higher productivity
and returns per site. Within the convenience store industry, the
introduction of QSRs remains in its early-stage, and we believe
that QSRs are likely to continue to grow in importance in
driving growth and change in the convenience store industry.
Increasing Competition
In-store sales across the industry are under pressure from the
growth of mass-merchants, warehouse clubs, grocers and
drug-store retailers as they move into convenience consumables,
add more locations and offer extended hours. In addition,
mass-merchants and warehouse clubs, such as Wal-Mart and Costco,
now offer fueling stations at their existing locations.
Energy Analysts International, Inc., or EAI, estimates that the
number of supermarkets offering fuel increased at an annualized
rate of 65% over three years, with the group now capturing
nearly 7.7% of the total market volume, up from 6.6% in 2003.
EAI estimates that supermarkets, discount stores and mass
merchandise/club store retailers operated 3,580 motor fuel
outlets in 2004. This store distribution poses a challenge to
traditional convenience store outlets because supermarkets are
often in locations of greater direct competition. Also, these
operators may price gasoline aggressively in order to attract
customer traffic in the hope of stimulating purchases in their
more profitable and primary retail categories.
NACS indicates that gross margins are much lower in regions with
significant presence of these new operators. Despite the rather
strong appreciation in the price of gasoline, the average gross
margin received by the convenience store retailers has remained
relatively stable. According to NACS, the average fuel margin
ranged from $0.127 to $0.137 per gallon between 2000 and 2004.
New Store Builds
According to NACS, retailers spent $203,000 per remodeled
store and $2.9 million (including land acquisition costs)
for each new store built in 2004. We believe that, in the
long-term, ongoing investments in building new stores and
improving existing stores will lead to greater customer traffic
and increased sales.
78
Table of Contents
BUSINESS
Company Overview
We are a diversified energy business focused on petroleum
refining and supply and on retail marketing. Our business
consists of two main operating segments: refining and retail.
Our refining segment operates a high conversion, moderate
complexity independent refinery in Tyler, Texas. Our retail
segment markets gasoline, diesel and other refined petroleum
products and convenience merchandise through a network of
349 company-operated retail fuel and convenience stores. We
also have a wholesale fuel distribution operation. We have grown
rapidly since our initial acquisition of 198 retail sites
in May 2001. We believe that our performance-driven,
results-oriented corporate culture is a key element of our
success in executing our strategy and achieving competitive
advantages. We focus on creating value in our existing and
acquired assets through disciplined financial management and
operating expense and loss prevention controls, extensive
utilization of information technology and implementation of
innovative marketing strategies, and by fostering a culture of
dedication and teamwork among our employees. We continually seek
to improve our operations, expand our customer base and identify
desirable acquisition targets.
Refining segment.
Our refining segment operates a high
conversion, moderate complexity independent refinery with a
design crude distillation capacity of 60,000 bpd, along
with an associated crude oil pipeline and light products loading
facilities. The Tyler refinery includes a fluidized catalytic
cracking unit and a delayed coker, enabling us to produce over
93% light products and less than 2% heavy oil products. The
refinery is located in the city of Tyler in East Texas, and is
the only supplier of a full range of petroleum products within a
radius of approximately 115 miles of its location. Crude
oil, most of which is produced locally, is delivered to the
Tyler refinery primarily by pipeline, either through
65 miles of Delek-owned pipeline or a third-party pipeline
that we lease. The Tyler refinery has the ability to produce and
sell a full range of gasoline, diesel, jet fuels and
petrochemical feedstocks. For the period April 29, 2005
through September 30, 2005, gasoline accounted for
approximately 52% and diesel and jet fuels accounted for
approximately 41% of the Tyler refinery's production. The
Tyler refinery's refined petroleum products are marketed
through our truck loading facilities and third-party pipelines
directly to major oil companies such as ExxonMobil and Chevron,
independent refiners and marketers such as Valero, and jobbers,
distributors, utility and transportation companies and
independent retail fuel operators.
Retail segment.
Our retail segment markets gasoline,
diesel, other refined petroleum products and convenience
merchandise through a network of 349 company-operated
retail fuel and convenience stores located in Alabama, Arkansas,
Georgia, Kentucky, Louisiana, Mississippi, Tennessee and
Virginia. Our stores operate primarily under the
MAPCO Express
®
,
East Coast
®
and Discount
Food Mart
tm
brands. Approximately 93% of our stores are concentrated in
Tennessee, Alabama and Virginia. Our stores market gasoline and
diesel under our fuel brands as well as the
BP
®
,
Exxon
®
,
Shell
®
and
Chevron
®
brands. We also market a broad selection of beverages and
merchandise designed to appeal to the convenience needs of our
customers. In addition, we have begun to sell proprietary food
offerings under our Grille
Marx
tm
brand. We also have a wholesale fuel distribution operation that
supplies more than 50 dealer-operated retail locations.
For the nine months ended September 30, 2005 and the year
ended December 31, 2004, we generated net sales of
$1.4 billion and $857.9 million, respectively, net
income of $39.5 million and $7.3 million,
respectively, and Adjusted EBITDA of $98.5 million and
$31.9 million, respectively. Our results for the nine
months ended September 30, 2005 reflect the operations of
the Tyler refinery since we acquired it on April 29, 2005.
See "Selected Historical Consolidated Financial
Information" for our calculation of Adjusted EBITDA, as
well as a reconciliation of Adjusted EBITDA amounts to net
income, the most directly comparable GAAP measure.
Financial information for our refining and retail segments is
presented in the "Selected Historical Consolidated
Financial Information" and "Unaudited Pro Forma
Condensed Consolidated Financial Data" and discussed in
"Management's Discussion and Analysis of Financial
Condition and Results of Operations."
79
Table of Contents
Corporate History and Development of the Business
We are a Delaware corporation formed in April 2001. We are an
indirect wholly-owned subsidiary of Delek Group Ltd., a
conglomerate that is domiciled and publicly traded in Israel,
which has significant interests in fuel supply businesses, and
which is controlled by Mr. Yitzchak Sharon Teshuva, an
Israeli citizen. Delek Group Ltd.'s revenues and net income
for the nine months ended September 30, 2005, as reported
in its financial statements as of September 30, 2005
submitted to the Tel-Aviv Stock Exchange and the Israel
Securities Authority on November 28, 2005, were New Israeli
Shekels (NIS) 15.1 billion and NIS 500 million,
respectively (or approximately $3.3 billion and
$109 million, respectively, based upon an exchange rate of
approximately 4.598 NIS per $1.00 on September 30, 2005).
We were formed by Delek Group Ltd. in connection with our
acquisition in May 2001 of 198 retail fuel and convenience
stores from a subsidiary of The Williams Companies. Since then,
we have completed several other acquisitions of retail fuel and
convenience stores. In 2005, we expanded our scope of operations
to include complementary petroleum refining and wholesale and
distribution businesses by acquiring the Tyler refinery.
Our principal acquisitions to date are summarized below:
Approximate Purchase
Date
Acquired Company/Assets
Acquired From
Price
May 2001
MAPCO Express, Inc., with 198 retail fuel and convenience stores
Williams Express, Inc.
$162.5 million
June 2001
36 retail fuel and convenience stores in Virginia
East Coast Oil Corporation
$40.1 million
February 2003
Seven retail fuel and convenience stores
Pilot Travel Centers
$11.9 million
April 2004
Williamson Oil Co., Inc., with 89 retail fuel and convenience
    stores in Alabama, a wholesale fuel and merchandise distribution
    operation
Williamson Oil Co., Inc.
$19.8 million, plus assumed debt of $28.6 million
April 2005
Refinery, pipeline and other refining, product terminal and
    crude oil pipeline assets located in and around Tyler, Texas,
    including physical inventories of crude oil, intermediates and
    light products
La Gloria Oil and Gas Company
$68.1 million, including $25.9 million of prepaid
    crude inventory and $38.4 million of assumed crude vendor
    liabilities
December 2005
21 retail fuel and convenience stores, a network of four
    dealer-operated stores, four undeveloped lots and inventory in
    the Nashville, Tennessee area
BP Products North America, Inc.
$35.0 million
We will continue to review acquisition and organic growth
opportunities in the refining, retail fuel and convenience store
markets as well as opportunities to acquire other petroleum sale
and distribution logistical assets such as pipelines, terminals
and fuel storage facilities.
Market Opportunities
We believe the following factors create a positive outlook for
our business:
Major oil and gas companies and retailers continue to divest
refining and retail assets.
Over the past few years, several
major oil and gas companies and retailers have divested
portfolios of refining and retail assets. For example, in 2005,
BP sold stores in the Memphis, Tennessee and Nashville,
Tennessee markets and recently announced its intention to sell
stores in Arizona and Northern California. Shell recently
announced plans to sell sites in Atlanta, Georgia,
Baton Rouge, Louisiana, Memphis, Tennessee, Tampa, Florida
and several other locations across the United States. Similarly,
Shell Oil sold its Bakersfield, California refinery to
Flying J in 2005. We believe that major oil and gas
companies and retailers will
80
Table of Contents
continue to divest refining and retail assets to free their
capital and managements' attention for larger scale
investment opportunities, thus providing us with attractive
acquisition and growth opportunities.
Substantial opportunities for consolidation in the
U.S. convenience store industry.
The U.S. convenience
store industry is highly fragmented. According to the NACS, the
top 100 companies, ranked by sales, account for only 32% of
total industry sales. In addition, approximately 66% of all
convenience stores in the United States are operated by
companies with less than ten stores. A substantial majority of
these convenience stores are single store operators. We believe
that these smaller operators typically do not have the
combination of operational and financial resources necessary to
implement the marketing strategies and information technology
systems that companies of our size do, and that they do not
enjoy our economies of scale when negotiating contracts, such as
contracts for merchandise or fuel supply. We believe that these
smaller operators are at a competitive disadvantage to us and
that we will continue to be presented with additional
acquisition opportunities.
Favorable supply/demand dynamics in the U.S. refining
sector.
We believe that high capital costs and environmental
regulatory requirements have limited the growth of refining
capacity, construction of new refineries and the expansion of
existing refineries in the United States over the past
30 years. According to the EIA, the number of operable
U.S. refineries has decreased from 319 in 1980 to 148 in
2005. The last major new oil refinery in the United States was
built in 1976. We believe that limited refining capacity in the
United States, along with increasing utilization rates and
steadily increasing demand for refined petroleum products, has
produced a sustainable shift in market dynamics that will
benefit our refining segment.
Expansion opportunities beyond our current geographic
footprint.
Our retail business is currently concentrated in
the southeastern United States, especially in Tennessee, Alabama
and Virginia. We believe that states adjacent to those in which
we currently operate, or in which we currently have a relatively
small number of stores, such as Florida, North Carolina,
South Carolina, Arkansas, Georgia, Mississippi, Kentucky,
Louisiana and Texas, provide opportunities for us to expand.
Competitive Advantages
We believe we enjoy the following competitive advantages:
Proven ability to integrate acquisitions.
As a result of
our performance-driven, results-oriented corporate culture,
dedicated work force and commitment to excellence through
operations and training, we have been successful in rapidly
integrating our refinery acquisition, four large retail fuel and
convenience store acquisitions and several smaller acquisitions
since our formation in 2001. Since our acquisition of the Tyler
refinery, we have implemented managerial and operational
enhancements that have resulted in increased refinery
utilization, an increase in our truck rack margins and expansion
of our customer base. We have also improved the productivity and
profitability of the convenience stores we acquired by
implementing merchandising and fuel sales initiatives,
instituting operating expense and loss prevention controls,
reducing overhead and centralizing functions such as accounting,
purchasing and information technology.
Niche market refinery.
Our Tyler refinery is located in a
niche market and primarily produces high value transportation
fuels. Our Tyler refinery is the only supplier of a full range
of refined petroleum products within a radius of approximately
115 miles of its location. Our owned and leased pipelines
are connected to five crude oil pipeline systems that provide us
with access to East Texas, West Texas and other domestic and
foreign crude oils. The refinery owns the larger of two truck
rack facilities for the loading of transportation fuels in the
vicinity of Tyler, Texas and supplies the other one. We believe
this provides us with a cost advantage over other companies that
would need to import transportation fuel via truck from outside
the region. We believe that demand in the local and regional
markets is sufficient to absorb the additional supply of refined
petroleum products that will result from our increased refinery
utilization. For the period April 29, 2005 through
September 30, 2005, gasoline accounted for approximately
52% and diesel and jet fuels accounted for approximately 41% of
the Tyler refinery's production. In addition, the Tyler
refinery utilizes only approximately 100 out of the
663 acres of land we own in Tyler, providing us with
opportunities for expansion and growth on the remaining land.
81
Table of Contents
Management focus and merchandising and operations
expertise.
We believe that our management approach
encourages employee participation in decision-making. This
approach allows us to identify market trends and opportunities
and to rapidly implement store specific strategies and programs
to exploit those trends and opportunities to improve results of
operations at our stores. Human and technological intelligence
is key to our retail business strategy, which is based on the
concept of the "neighborhood" store —
pricing and stocking each store individually to meet the customs
and tastes of the community, while at the same time using our
market presence to take advantage of the purchasing economies of
scale and the marketing and operating sophistication and
financial resources of a large convenience store operator. We
believe our merchandising strategy positions our new and
existing sites as the preferred destinations for purchases of
immediate consumption convenience goods. Our management approach
also incorporates a strong focus on controlling operating
expenses and loss prevention, which has been an important
element in the successful development of our retail segment.
Strong market presence in our existing retail markets.
We
have a leading market position in our core markets in the
southeastern United States, where we have a concentrated
portfolio of quality retail stores. "MAPCO" is a
well-recognized name throughout the southeastern United States,
and our "East Coast" and "Discount Food
Mart" brands are well known in Virginia and Alabama, the
respective markets in which we operate. Our market penetration
in those markets drives brand recognition among customers. We
believe that we rank first among convenience store operators in
terms of the number of stores in each of the Nashville, Memphis
and Northern Alabama regions. We believe that we rank third
among convenience store operators in the number of stores in the
Richmond, Virginia region. This concentration of stores enables
us to realize economies of scale and cost-efficiencies and
provides us with a platform for continued growth through
acquisitions in these core regions.
Scalable information technology systems.
We believe that
our information technology systems allow us to maximize sales
and margins and reduce inefficiencies in our cost structure by
delivering timely and focused feedback on margins and sales
volume. These systems enable our merchandising managers to react
quickly to maximize our profit opportunities. Most of our stores
provide real-time information via high speed data networks to
our supply chain management, inventory management and security
systems. Our refinery systems enable real-time monitoring of
customer-specific sales volumes and margin impacts. These
systems are integrated into many aspects of our operations. We
believe these systems are scalable and will support future
growth plans. For example, we have invested significant time and
effort in developing a proprietary point of sale, or POS system,
for our retail stores that integrates all operations of our
stores with the reporting processes of our accounting
department. Our POS system is dynamic and can easily and quickly
support additional stores.
Experienced Management.
We believe that our strong
management is a key element of our competitive advantages and
our ability to continue to successfully execute our strategies.
The management teams of both our refining and retail segments
have extensive industry experience. For example, the most senior
manager of our refining segment and each of his four direct
reports have, on average, approximately 26 years industry
experience, and the eight most senior operations and marketing
managers of our retail segment have an average of approximately
28 years industry experience. Our management's
experience also includes a strong cross-section of disciplines,
including marketing, operations, finance and information
technology.
Strategy
In order to strengthen our market position, enhance growth and
maximize our profitability and cash flow, we intend to:
Pursue opportunistic acquisitions that strengthen our core
markets and leverage our core competencies.
We have a track
record of rapidly expanding our business through asset
acquisitions. As we seek to grow, we will opportunistically
target assets or businesses where we can apply our core
competencies of integrating assets and apply our merchandising
expertise, operating expense and loss prevention controls and
information technology platform to substantially enhance their
operating and financial performance. Our retail business is
currently concentrated in the southeastern United States,
especially in Tennessee, Alabama and Virginia. We
82
Table of Contents
intend to expand into states adjacent to those in which we
currently operate or in which we currently have fewer stores,
such as Florida, North Carolina, South Carolina, Arkansas,
Georgia, Mississippi, Kentucky and Louisiana. We may also seek
to expand our retail business into the Tyler, Texas area, which
would give us the benefit of physically integrating a portion of
our retail segment with the Tyler refinery. Our goal is to
continue to expand our retail business through acquisitions and
new store development, and we intend to actively pursue
additional refinery acquisitions. Target refineries may or may
not be inside our current geographic operating areas. We also
plan to selectively pursue additional acquisitions of logistic
and other assets complementary to our refinery.
Modernize and improve the profitability of our Tyler
refinery.
We have implemented, and intend to continue to
implement, operational changes and capital investments to
improve the efficiency, processing capacity and utilization of
our Tyler refinery. Our management team has begun to and will
continue to source new crude supplies, including foreign crude,
to provide us with greater flexibility in optimizing the
feedstock supply to the Tyler refinery. Recently, and at no
capital cost, we have effectively increased the delivery
capacity of our leased pipeline through the use of drag-reducing
chemicals. We believe that our operational improvements and
increased crude oil delivery capacity will allow us to increase
the Tyler refinery's average crude oil throughput from
historic levels of approximately 50,000 bpd to almost
60,000 bpd by early 2006. We have purchased a 50 long
ton per day sulfur recovery unit and a 75 long ton per day
tail gas treating unit to supplement the refinery's
existing sulfur recovery capacity of 19.4 short tons per day.
This unit will be installed in 2006. We are in the process of
revamping an existing distillate desulfurization unit from its
current capacity of 12,000 bpd to 22,000 bpd, allowing
us to reduce the sulfur level in all of our diesel fuel to less
than 15 parts per million. This project is scheduled for
completion by mid-2006. We are also reviewing multiple
efficiency enhancements and capital expansion projects to
increase our profitability. These projects include upgrading and
centralizing our refinery control systems, installing energy
conservation systems, expanding the capacity of our refinery,
upgrading our processing units to allow us to process lower
quality crude oil and expanding our distribution system beyond
our current market. We have engaged refinery engineering
consultants to conduct a feasibility study that evaluates
several of these projects, which we expect to be delivered in
early 2006.
Consistent with our performance-driven, results-oriented
corporate culture, we believe in instilling responsibility and
accountability to all levels of staffing. We believe this
strategy has resulted, and will continue to result, in a
corporate culture that quickly identifies and evaluates
challenges, finds innovative and permanent solutions, and
implements them in a timely and cost-effective manner.
Grow the customer base and improve the profitability of our
Tyler-area niche market.
We believe that there is additional
demand in the Tyler, Texas area for products produced at our
Tyler refinery. Since acquiring the refinery in April 2005, we
have been successful in expanding our customer base and in
increasing sales to existing customers. We plan to continue to
target potential customers who currently have supply contracts
with others but may be interested in purchasing from us. We
believe that our efforts to improve the reputation of the truck
rack with respect to timely loading and product availability
will continue to draw former customers of the refinery back to
our rack, and attract new customers. In addition to increasing
sales, our management team intends to continue renegotiating
marketing contracts on more favorable terms, in order to further
benefit from the competitive advantage we have in our niche
market location.
Reinforce our brand recognition through targeted retail
merchandising strategies.
We intend to maintain our position
as a strong retail competitor in the southeastern United States.
To increase brand awareness in our markets, we are in the
process of implementing a new branding and re-imaging campaign
that will include the retrofitting of select existing stores and
the building of new stores with the "MAPCO Mart"
brand. We aim to maintain our existing customer base while
attracting a more upscale clientele to our re-imaged stores by
offering premium amenities and products, such as a proprietary
made-to
-order food
program with touch-screen order machines, indoor and outdoor
seating, expanded coffee and hot drink bars, an expanded cold
and frozen drink area where customers can customize their drink
flavors, a walk-in beer cave, fresh flowers, greeting cards,
produce and gourmet breads. We will continue to emphasize our
"neighborhood
83
Table of Contents
store" concept by focusing on customizing product mix and
promotional strategies based on the demographics surrounding
each location. We will also focus on offering "signature
items" – unique items or programs that we feature
on signage, in training and on displays – to
differentiate ourselves from our competitors. In addition, a
major component of our new branding campaign is to increase
sales from fresh food service, the fastest – growing,
highest-margin category in the convenience store segment.
Continually renew the physical assets of our retail
business.
We intend to ensure that our retail stores are
positioned to maximize customer traffic and provide our
consumers with an enhanced purchasing experience. We are in the
process of upgrading our retail stores through extensive
remodeling, raze-and-rebuilding and acquisition. We are also
developing a supplementary growth strategy that focuses on new
site selection and construction to complement our acquisition
strategy. As part of our strategy, we may divest underperforming
or non-strategic stores by either converting them to dealer
operated locations or closing them and then selling or leasing
the real estate for other business use, as appropriate. We
believe that these steps will lead to improved operating results.
Develop innovative information technology applications in all
of our businesses.
We intend to continue our investment in
technological infrastructure. We believe that by leveraging our
innovative information technology platform, we will be able to
better address the needs of our customers. In addition, by
optimizing our information technology, we also expect to improve
our operating efficiencies and improve our management of
inventory. We are implementing a scanning and data warehouse
management system to integrate with our POS systems at each of
our retail stores. This system, which we expect to roll out to
substantially all of our stores in 2006, will enable us to
better manage our inventory, optimize our marketing strategy,
manage our stores on a site level basis, and reduce cash and
merchandise shortages. Taken together, we expect these factors
to allow us to improve our gross profit dollars and operating
results.
Refining Segment
We operate a high conversion, moderate complexity independent
refinery with a design crude distillation capacity of
60,000 bpd, along with an associated crude oil pipeline and
light products loading facilities. The refinery is located in
the city of Tyler in East Texas, and is the only supplier of a
full range of refined petroleum products within a radius of
approximately 115 miles of its location.
The Tyler refinery is situated on approximately 100 out of a
total of 663 acres of land owned by us. The Tyler refinery
includes a fluidized catalytic cracking unit and a delayed
coker, enabling us to produce over 93% light products and less
than 2% heavy oil products. It has the ability to produce and
sell a full range of gasoline, diesel, jet fuels, liquefied
petroleum gas, or LPG, and natural gas liquids, or NGLs. For the
period April 29, 2005 through September 30, 2005,
gasoline accounted for approximately 52% and diesel and jet
fuels accounted for approximately 41% of the Tyler
refinery's production.
The inland location of the Tyler refinery provides a degree of
protection from the effects of tropical weather. While Hurricane
Rita caused significant property damage and resulted in a
substantial period of down time for numerous refiners in
Southern Texas, the Tyler refinery maintained stable operations
throughout, and was the sole supplier of refined petroleum
products in East Texas during late September 2005, as competing
terminals in our region ran out of supply.
Fuel Customers.
We have the advantage of being able to
deliver nearly all of our gasoline and much of our diesel fuel
production into the local market. Our customers have strong
credit profiles and include major oil companies, independent
refiners and marketers, jobbers, distributors, utility and
transportation companies, and independent retail fuel operators.
Our refinery's ten largest customers accounted for
$356.7 million, or 60.5%, of net sales for the refinery for
the period April 29, 2005 (the date we acquired the Tyler
refinery) to September 30, 2005. Our customers include
ExxonMobil, Valero Marketing and Supply, Truman Arnold and
Chevron, among others. Although none of our customers account
for 10% or more of our consolidated net sales, ExxonMobil and
Valero Marketing and Supply accounted for approximately 15% and
10%, respectively, of net sales for the refinery for the period
April 29, 2005 to September 30, 2005.
84
Table of Contents
The Tyler refinery does not generally supply fuel to our retail
fuel and convenience stores, since it is not located in the same
geographic region as our stores.
Refinery Design and Production.
The Tyler refinery has a
crude oil processing unit with a 60,000 bpd atmospheric
column and a 16,000 bpd vacuum tower. The other major
process units at the Tyler refinery include a 20,200 bpd
fluid catalytic cracking unit, a 6,800 bpd delayed coking
unit, a 20,000 bpd naphtha hydrotreating unit, a
12,000 bpd distillate hydrotreating unit, a 17,500 bpd
continuous regeneration reforming unit, a 5,000 bpd
isomerization unit, and an alkylation unit with a capacity of
4,700 bpd.
In February 2005, the prior owner of the Tyler refinery
conducted a turnaround on the crude unit, vacuum unit, delayed
coking unit, naphtha hydrotreater, CCR Platformer and distillate
hydrotreating unit. In December 2005, we successfully completed
an additional turnaround on the remainder of the refinery units,
including the fluid catalytic cracking unit, the sulfuric
alkylation unit, sulfur recovery unit, amine unit and kerosene
and gasoline treating units. We do not plan to conduct another
refinery turnaround earlier than 2009.
The Tyler refinery was designed to process light, sweet crude
oil, which is a higher quality, more expensive crude oil than
heavy, sour crude oil. Our owned and leased pipelines are
connected to five crude oil pipeline systems that allow us
access to East Texas, West Texas and foreign sweet crude oils. A
small amount of local East Texas crude oil is also delivered to
the refinery by truck. The table below sets forth information
concerning crude oil received at the Tyler refinery from
April 29, 2005 to September 30, 2005:
Percentage of
Crude Oil
Source
Received
East Texas Crude Oil
72%
West Texas Intermediate Crude Oil
24%
Foreign Sweet Crude Oil
4%
Upon delivery to the Tyler refinery, crude oil is sent to a
distillation unit, where complex hydrocarbon molecules are
separated into distinct boiling ranges. The processed crude oil
is then treated in specific units of the refinery, and the
resulting distilled and treated fuels are pumped to blending
units to create the desired finished fuel product. A more
detailed summary of our production output for the period
April 29, 2005 through September 30, 2005 follows:
•
Gasoline.
Gasoline accounted for approximately 52% of our
    refinery's production. The refinery produces four different
    grades of conventional gasoline (premium — 92 and 93
    octane, regular and mid-grade), as well as aviation gasoline.
•
Diesel/jet fuels.
Diesel and jet fuel products accounted
    for approximately 41% of our refinery's production. Diesel
    and jet fuel products include military specification jet fuel
(JP-8),
commercial jet
    fuel, high sulfur diesel (No. 2 oil), low sulfur diesel,
    and ultra low sulfur diesel.
•
Petrochemicals.
We produce small quantities of propane,
    refinery grade propylene and butanes.
•
Other products.
We produce small quantities of other
    products, including, anode grade coke, slurry oil, sulfur and
    other blendstocks.
The average throughput of the refinery between January 1,
2002 and April 29, 2005, was 50,833 bpd. The average
throughput since we took ownership of the Tyler refinery on
April 29, 2005 through September 30, 2005 has been
53,765 bpd. The table below sets forth information
concerning the historical
85
Table of Contents
throughput and production at the Tyler refinery. The data for
all periods prior to April 29, 2005 have been derived from
the internal financial records of the previous owner.
Nine Months Ended
Delek
Year Ended December 31
September 30,
Ownership(2)
2002
2003
2004
2004
2005(1)
Bpd
%
Bpd
%
Bpd
%
Bpd
%
Bpd
%
Bpd
%
Refinery throughput:
Crude
50,893
96.5
%
50,540
96.2
%
46,885
93.9
%
47,202
94.0
%
47,576
97.0
%
52,887
98.4
%
Other blendstocks
1,873
3.5
%
1,992
3.8
%
3,051
6.1
%
3,007
6.0
%
1,491
3.0
%
878
1.6
%
Total refinery throughput
52,766
100.0
%
52,532
100.0
%
49,936
100.0
%
50,209
100.0
%
49,067
100.0
%
53,765
100.0
%
Products produced:
Gasoline
29,336
56.6
%
29,775
57.5
%
28,349
57.6
%
28,778
58.2
%
25,594
53.4
%
27,366
52.4
%
Diesel/ jet
18,452
35.6
%
17,627
34.0
%
17,613
35.8
%
17,333
35.0
%
18,272
38.1
%
21,288
40.8
%
Petrochemicals, LPG, NGLs
2,451
4.7
%
2,408
4.6
%
2,153
4.4
%
2,254
4.6
%
2,073
4.3
%
2,517
4.8
%
Other
1,591
3.1
%
2,040
3.9
%
1,108
2.2
%
1,095
2.2
%
2,001
4.2
%
1,061
2.0
%
Total products produced
51,830
100.0
%
51,850
100.0
%
49,223
100.0
%
49,460
100.0
%
47,940
100.0
%
52,232
100.0
%
(1)
Throughput during the nine months ended September 30, 2005
    reflects reductions resulting from the turnaround conducted by
    the previous owner during the first quarter of 2005.
(2)
Effective April 29, 2005, we completed the acquisition of
    the Tyler refinery and related assets. We have operated the
    refinery for 155 days in the fiscal period ended
    September 30, 2005.
We currently are evaluating the economic feasibility of several
projects to expand our refinery output and productivity, which
include expanding the capacity of our refinery and upgrading our
processing units to allow us to process higher sulfur crude oils.
Storage Capacity.
Storage capacity at the Tyler refinery,
including tanks along our pipeline, totals approximately
2.7 million barrels, consisting of approximately
1.2 million barrels of crude oil storage and
1.5 million barrels of refined and intermediate product
storage.
Supply and Distribution.
The majority of the crude oil
purchased for the Tyler Refinery is East Texas crude oil. Most
of this East Texas crude oil processed in our refinery is
delivered by truck or through our pipeline and leased pipeline
from Nettleton Station in Longview, Texas. This represents an
inherent cost advantage due to our ability to purchase crude oil
on its way to market, as opposed to purchasing from a market or
trade location. We primarily purchase crude oil with monthly
spot trading contracts from various suppliers. Our ability to
access WTI or foreign sweet crude oil, when they are available
at competitive prices, has helped significantly to maintain the
refinery's competitive supply cost advantage. These
alternate supply sources allow us to optimize the refinery
operation and utilization while also allowing us to more
favorably negotiate the cost and quality of the local East Texas
crude oil we purchase.
Our owned crude oil pipeline consists of approximately
65 miles of principally
6-inch
crude oil lines
that transport light sweet crude oil to the Tyler refinery. We
currently operate the main trunk line, and the following pump
stations and terminals that are also owned by us:
•
Delek Tank Farm: One 150,000 barrel and one
    300,000 barrel tank.
•
Nettleton Station: Five 50,000 barrel tanks.
•
Bradford Station: One 50,000 barrel and one
    10,000 barrel tank.
•
ARP Station: Two 50,000 barrel tanks.
The vast majority of the transportation fuels and other products
are sold via truck directly from the refinery. We operate a nine
lane transportation fuels truck rack with a wide range of
additive options, including proprietary packages dedicated for
use by our major oil company customers. LPG, NGLs, and clarified
slurry oil are also sold via truck from dedicated loading
facilities at the refinery. We also have a
86
Table of Contents
pipeline connection for the sale of propane into a facility
owned by Texas Eastman. Petroleum coke is sold primarily via
rail from the refinery, with occasional truck loading for
specialty or excess product.
The remainder of our transportation fuels are sold via pipeline
to a single, pipeline-connected terminal owned by Chevron. We
transport these products on TEPPCO pipeline to a point of
interconnection to a Chevron-owned pipeline terminating in Big
Sandy, Texas. There are currently no other pipeline-connected
destinations for our transportation fuels.
Safety.
Our refinery has historically had a good safety
record. We have an extensive safety training program for our
refinery's employees.
Competition.
The refining industry is highly competitive
and includes fully integrated national or multinational oil
companies engaged in many segments of the petroleum business,
including exploration, production, transportation, refining,
marketing and convenience stores. Our principal competitors are
Texas Gulf Coast refiners, product terminal operators in our
region and Calumet Lubricants in Shreveport, Louisiana. The
principal competitive factors affecting our refinery operations
are crude oil and other feedstock costs, refinery product
margins, refinery efficiency, refinery product mix and
distribution and transportation costs. Certain of our larger
competitors operate refineries that are larger and more complex
and, as a result, could have lower per barrel costs or higher
margins per barrel of throughput. We have no crude oil reserves
and are not engaged in exploration. We believe however, that
absent unforeseen circumstances, or those beyond our control, we
will be able to obtain adequate crude oil and other feedstocks
at generally competitive prices for the foreseeable future.
Retail Segment
We operate 349 retail fuel and convenience stores, which are
located in Alabama, Arkansas, Georgia, Kentucky, Louisiana,
Mississippi, Tennessee and Virginia, primarily under the MAPCO
Express
®
,
East
Coast
®
and Discount Food
Mart
tm
brands. Our retail fuel and convenience store segment also
includes a wholesale fuel distribution operation that supplies
more than 50 dealer-operated retail locations. We believe
that we have established strong brand recognition and market
presence in the major retail markets in which we operate.
Approximately 93% of our stores are concentrated in Tennessee,
Alabama and Virginia. In terms of number of retail fuel and
convenience stores, we rank in the top-tier in our major markets
such as, Nashville, Memphis, northern Alabama and Richmond.
We operate a successful business model that we believe enables
us to generate higher per gallon gas margins than the industry
average as well as drive merchandise sales that are higher than
the industry average. Our stores are positioned in high traffic
areas (approximately 70% of our stores are located at corner
locations) and we employ a localized marketing strategy that
focuses on the demographics surrounding each store and
customizing the product mix and promotional strategies to meet
the needs of customers in those demographics. In addition, we
utilize operating expense and loss prevention controls to
enhance operating performance.
Company-Operated Stores.
Of our sites, approximately 66%
are open 24 hours per day and the remaining sites are open
at least 16 hours per day. Our average store size is
approximately 2,300 square feet with approximately 64% of
our stores being more than 2,000 square feet.
Our retail fuel and convenience stores typically offer tobacco
products and immediately consumable items such as beer,
non-alcoholic beverages and a large variety of snacks and
prepackaged items. A significant number of the sites also offer
state sanctioned lottery games and ATM services. Several of our
locations also include well recognized national quick service
food chains such as
Subway
®
,
and we have begun to offer proprietary food offerings under our
GrilleMarx
tm
brand. In light of the popularity and growth of upscale coffee
shops, we have entered into an agreement with a coffee roaster
to provide us with product that we believe is of significantly
higher quality than what is typically offered in the self
service environment. We have also initiated a segment-wide focus
on sales and marketing of food, coffee and fountain drinks, and
we have begun the development of our "next generation
store", a unique concept and store designed to add quality
fresh food offerings in an upscale, state of the art facility.
This new concept is expected to generate
87
Table of Contents
higher margins and is intended to expand our potential customer
base by attracting the core convenience store shopper as well as
those seeking a meal solution. This concept will be added to new
stores as well as retrofitted into selected existing locations.
Additionally, we plan to introduce private label lines to our
soft drink, sandwich, and automotive products offerings which
typically enhance margins.
All of our locations are retail fuel and convenience stores. The
majority of our retail fuel and convenience stores have 4 to 5
multi-pump dispensers with credit card readers. Virtually all of
our company-operated locations have a canopy to protect
self-service customers from rain and to provide street appeal by
creating a modern, well-lit and safe environment.
Fuel Operations.
For the nine months ended
September 30, 2005 and the year ended December 31,
2004, our net fuel sales were 72.5% and 69.6%, respectively, of
net sales for our retail segment. The following table highlights
certain information regarding our fuel operations for the years
ended December 31, 2002, 2003 and 2004 and the nine months
ended September 30, 2004 and 2005:
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004
2004
2005
Number of stores (end of period)
236
243
331
332
328
Average number of stores
236
242
310
302
329
Retail fuel sales (thousands of gallons)
267,396
267,476
315,294
231,315
249,507
Average retail gallons per average number of stores (thousands
    of gallons)
1,133
1,105
1,017
766
758
Retail fuel margin (per gallon)(1)
$0.130
$0.154
$0.155
$0.149
$0.164
Lundberg Survey Rack-to-Retail Fuel Margin (per gallon)(2)
$0.116
$0.137
$0.116
$0.109
$0.121
(1)
Retail fuel margins per gallon are calculated as the retail
    sales price less fuel discounts, costs of product, and
    transportation.
(2)
Rack-to-retail margins shown in the chart above are a weighted
    average composite of rack-to-retail margins for diesel and
    gasoline sales, including regular, medium grade and premium
    unleaded gasoline, in Alabama, Tennessee and Virginia, based on
    Lundberg Survey data. Of our 349 retail fuel and convenience
    stores, 326 are located in those states, and the margins have
    been weighted to correspond to our percentage sales of the
    various grades and types of fuel sold by us in those states.
    Because we report fuel sales as a composite of our gasoline and
    diesel sales, and because our retail fuel and convenience stores
    are concentrated in Alabama, Tennessee and Virginia, we believe
    that this Lundberg Survey Rack-to-Retail Margin represents the
    most accurate benchmark with which to compare our historical
    fuel margins to those of the industry.
We currently operate a fleet of delivery trucks to deliver
approximately 61% of the fuel sold at our retail fuel and
convenience stores. We purchased approximately 53% of the fuel
used at our retail fuel and convenience stores for the nine
months ended September 30, 2005 from the Valero Marketing
and Supply under a contract that extends through the second
quarter of 2008. We also purchase fuel under contracts with BP,
ExxonMobil, Shell and Chevron, and purchase the balance of our
fuel from a variety of independent fuel distributors. The fuel
purchased is generally based on contracted differentials to
local and regional price benchmarks. The initial terms of our
supply agreements range from one year to 15 years and generally
contain minimum monthly or annual purchase requirements. To
date, we have met substantially all our purchase commitments
under these contracts.
The Tyler refinery does not generally supply fuel to our retail
fuel and convenience stores, since it is not located in the same
geographic region as our retail stores.
88
Table of Contents
Merchandise Operations.
For the nine months ended
September 30, 2005 and the year ended December 31,
2004, our merchandise sales were 27.5% and 30.5%, respectively,
of net sales for our retail segment. The following table
highlights certain information with respect to our merchandise
sales for the years ended December 31, 2002, 2003 and 2004
and for the nine months ended September 30, 2004 and 2005:
Nine Months
Ended
Year Ended December 31,
September 30,
2002
2003
2004
2004
2005
%
%
%
%
%
Total merchandise sales as a percentage of net sales for our
    retail segment
37.2
%
34.5
%
30.5
%
31.0
%
27.5
%
Comparable store merchandise sales change
N/A
(3.1
)%
4.1
%
4.5
%
1.5
%
Merchandise margin
26.7
%
28.4
%
29.5
%
29.4
%
30.0
%
Merchandise profit as a percentage of total margins
61.2
%
58.9
%
60.6
%
61.4
%
61.0
%
Based on merchandise sales information, we estimate our sales as
a percentage of total merchandise sales in the following
categories for the years ended December 31, 2002, 2003 and
2004 and for the nine months ended September 30, 2004 and
2005 were as follows:
Nine Months Ended
Year Ended December 31,
September 30,
2002
2003
2004
2004
2005
Cigarettes
37.8%
36.6%
33.8%
33.7%
33.8%
Other tobacco products
1.3%
3.1%
4.1%
3.9%
4.3%
Beer
18.7%
18.2%
17.4%
17.5%
17.1%
Soft drinks
7.9%
8.8%
9.3%
9.3%
9.3%
Dairy products
6.0%
6.5%
7.0%
7.1%
9.2%
Candy/ gum
2.5%
2.8%
2.7%
2.6%
3.0%
Snacks/ groceries
6.8%
7.1%
6.9%
6.7%
7.0%
Food service
4.9%
6.1%
6.0%
6.0%
5.9%
General merchandise
10.0%
7.5%
8.6%
9.0%
6.8%
Other
4.1%
3.3%
4.2%
4.2%
3.6%
Total merchandise sales
100.0%
100.0%
100.0%
100.0%
100.0%
We purchased approximately 45% of our general merchandise,
including most tobacco products and grocery items for the nine
months ended September 30, 2005 from a single wholesale
grocer, McLane Company, Inc., a wholly-owned subsidiary of
Berkshire Hathaway. Our contract with McLane expires in 2007,
but may be renewed at our option for an additional two year
period. Other major suppliers and manufacturers include
Coca-Cola, Pepsi-Cola, Frito Lay, Gatorade, Hershey's,
Kraft/ Nabisco and Oscar Mayer.
Technology and Store Automation.
We have developed
proprietary information management software programs that enable
us to access near real-time data to manage our stores on a
site-level basis and react rapidly to changes in our market.
Most of our stores are connected to a high speed data network
and provide near real-time information to our supply chain
management, inventory management and security systems. We
believe that our systems provide many of the most desirable
features commercially available today in the information
software market, while providing more rapid access to data,
customized reports and greater ease of use. Our information
technology systems help us manage our inventory, optimize our
marketing strategy, manage our stores on a site level basis, and
reduce cash and merchandise shortages. Our information
technology systems allow us to improve our profitability and
strengthen operating and financial performance in multiple ways,
including by:
•
tracking sales of complementary products; for example,
    determining the impact of fuel price movements on in-store sales
    or tracking the impact of a beer promotion on cigarette sales;
89
Table of Contents
•
providing real-time fuel inventory data on a per store basis to
    optimize fuel purchase and distribution costs;
•
pricing fuel at individual stores on a daily basis, taking into
    account competitors' prices, competitors' historical
    behavior, daily changes in cost, and the impact of pricing on
    in-store merchandise sales;
•
alerting us on a daily basis by store, district, and/or division
    to negative sales trends; for example, merchandise categories
    that are below budget or below the prior period's results;
•
reconciling store reported daily cash deposits and credit card
    settlements with electronic data from our vendor relationships
    to manage our current assets; and
•
integrating our security video with our point of sales
    transaction log in a searchable database that allows us to
    search for footage related to specific transactions, which
    enables us to identify potentially fraudulent transactions and
    employ real-world examples through which to train our employees.
Dealer Operations.
Our retail segment also includes a
wholesale fuel distribution network that supplies more than 50
dealer-operated retail locations. For the nine months ended
September 30, 2005 and the year ended December 31,
2004, our dealer net sales were approximately 5% and 4%,
respectively, of net sales for our retail segment. Our business
arrangements with dealers include contractual arrangements in
which we pay a commission to the dealer based on profits from
the fuel sales, contractual arrangements in which we supply fuel
and invoice the dealer for its cost of fuel plus an agreed upon
margin, and non-contractual arrangements in which dealers order
fuel from us at their discretion.
Some dealers either lease or sublease their facilities from us
and one dealer operates a location formerly owned and operated
by us. While we have agreements with our dealers that set forth
certain operating standards and the fuel purchase arrangements
described above; we do not control the dealers' personnel,
merchandise pricing, policies or other aspects of their
business. Other than fuel sales through dealers who receive
contractual commissions from us, we realize little direct
benefit from the sale of fuel or merchandise at the
dealer-operated stores, and their revenues from such sales are
not reflected in our consolidated financial statements. We
believe our relationships with dealers have been favorable,
providing us with customers for our fuel products and an
opportunity to divest certain company-operated stores that do
not fit within our business strategy.
Competition.
The retail fuel and convenience store
business is highly competitive. We compete on a store-by-store
basis with other independent convenience store chains,
independent owner-operators, major petroleum companies,
supermarkets, drug stores, discount stores, club stores, mass
merchants, fast food operations and other retail outlets. Major
factors of competition include location, ease of access,
pricing, product and service selections, customer service, fuel
brands, store appearance, cleanliness and safety. Changes in
traffic patterns and the type, number and location of competing
stores affect the performance of our stores. In addition,
factors such as inflation, increased labor and benefit costs and
the lack of availability of experienced management and hourly
employees would adversely affect the retail fuel and convenience
store industry.
Properties
We own our refinery in Tyler, Texas, which is situated on
approximately 100 out of a total of 663 acres of land owned
by us, along with an associated crude oil pipeline and light
products loading facilities.
As of December 15, 2005, we owned the real estate at 210
retail fuel and convenience store locations, and leased the real
property at 168 stores. Of the stores owned or leased by us, 21
were either leased or subleased to third party dealers; 40 other
dealer sites are owned or leased independently by dealers.
90
Table of Contents
The following table summarizes the real estate position of our
retail segment.
Number of
Remaining
Remaining
Company-
Number of
Number of
Number of
Lease Term
Lease Term
State
Operated Sites
Dealer Sites(1)
Owned Sites
Leased Sites
<3 Years(2)
>3 Years(2)
Tennessee
198
8
104
102
3
99
Alabama
92
44
69
40
3
37
Virginia
36
0
26
10
0
10
Arkansas
15
0
7
8
0
8
Kentucky
3
0
1
2
0
2
Louisiana
2
0
0
2
0
2
Mississippi
2
0
2
0
0
0
Georgia
1
7
1
4
0
4
Florida
0
2
0
0
0
0
Total
349
61
210
168
6
162
(1)
Includes 40 sites neither owned by nor subleased from us.
(2)
Includes renewal options; measured as of September 30, 2005.
Most of our retail fuel and convenience store leases are net
leases requiring us to pay taxes, insurance and maintenance
costs. Of the leases that expire in less than three years, we
anticipate that we will be able to negotiate acceptable
extensions of the leases for those locations that we intend to
continue operating.
We lease our 26,704 square foot corporate headquarters at
830 Crescent Centre Drive, Franklin, Tennessee. Our lease
expires in November 2006. We anticipate that we will require
additional space for our headquarters by the end of the term of
the lease, and do not foresee any problems with obtaining
suitable additional space.
Government Regulation and Environmental Matters
Many aspects of our operations are subject to regulation under
federal, state and local laws. The most significant of the
regulations are described below. While we believe we are in
substantial compliance with these laws, the laws and regulations
we are subject to change often, may be re-interpreted by
regulators or may become more stringent. The ultimate impact of
complying with existing laws and regulations is not always
clearly known or determinable due in part to the fact that our
operations may change over time.
Environmental Matters
We are subject to extensive federal, state and local laws and
regulations relating to protection of the environment. These
laws and the accompanying regulatory programs and enforcement
initiatives, some of which are described below, impact our
business and operations by imposing:
•
restrictions on our ongoing operations through permits and
    regulations;
•
liability for the remediation of contaminated soil, groundwater
    and other environmental media at our current or former
    facilities and at facilities where we have disposed of hazardous
    substances;
•
specifications on the refined petroleum products we market,
    including gasoline and diesel fuel; and
•
regulation of fuel storage at our retail fuel and convenience
    stores.
These regulations and other new air and water quality standards
and stricter fuel regulations could result in increased capital,
operating and compliance costs.
91
Table of Contents
Environmental Obligations — The Tyler Refinery.
The principal environmental risks associated with our refinery
operations are air emissions, releases into soil and groundwater
and wastewater excursions. The primary legislative and
regulatory programs that affect these areas are outlined below.
The Clean Air Act.
The federal Clean Air Act and
the corresponding state laws that regulate emissions of
materials into the air affect refining operations both directly
and indirectly. Direct impacts on refining operations may occur
through Clean Air Act permitting requirements and/or emission
control requirements relating to specific air pollutants. The
Clean Air Act indirectly affects refining operations by
extensively regulating the air emissions of sulfur dioxide and
other compounds, including nitrogen oxides, emitted by
automobiles, utility plants and mobile sources, which are direct
or indirect users of our products. In addition, volatile organic
compounds emitted at the refinery are heavily regulated,
including such compounds as benzene.
The Clean Air Act imposes stringent limits on air emissions,
establishes a federally mandated operating permit program and
allows for civil and criminal enforcement sanctions. The Clean
Air Act also establishes attainment deadlines and control
requirements based on the severity of air pollution in a
geographical area.
The Clean Water Act.
The federal Clean Water Act
of 1972 affects refining operations by imposing restrictions on
effluent discharge into, or impacting, navigable water. Regular
monitoring, reporting requirements and performance standards are
preconditions for the issuance and renewal of permits governing
the discharge of pollutants into water. We maintain discharge
permits as required under the National Pollutant Discharge
Elimination System program of the Clean Water Act and have
implemented internal programs to oversee our compliance efforts.
In addition, we are regulated under the federal Oil Pollution
Act, which amended the Clean Water Act. Among other
requirements, the Oil Pollution Act requires the owner or
operator of a tank vessel or a facility to maintain an emergency
oil response plan to respond to releases of oil or hazardous
substances. We have developed and implemented such a plan for
each of our facilities covered by the Oil Pollution Act. Also,
in case of such releases, the Oil Pollution Act requires
responsible companies to pay resulting removal costs and
damages, provides for substantial civil penalties, and imposes
criminal sanctions for violations of this law. The State of
Texas, in which we operate, has passed laws similar to the Oil
Pollution Act.
Ethanol and MTBE.
Ethanol and methyl tertiary
butyl ether, or MTBE, are the most commonly used oxygenated
blendstocks for producing cleaner-burning gasoline. However, the
presence of MTBE in some water supplies, resulting from gasoline
leaks primarily from underground and aboveground storage tanks,
has led to public concern that MTBE has contaminated drinking
water supplies, thus posing a health risk, or has adversely
affected the taste and odor of drinking water supplies. As a
result of heightened public concern, Congress and state
legislatures have either passed or proposed or are considering
proposals to restrict or ban the use of MTBE. We currently do
not blend ethanol or MTBE into our gasoline.
Resource Conservation and Recovery Act.
Our
refining operations are subject to RCRA requirements for the
treatment, storage and disposal of hazardous wastes. When
feasible, RCRA materials are recycled through our coking
operations instead of being disposed of
on-site
or off-site.
RCRA establishes standards for the management of solid and
hazardous wastes. Besides governing current waste disposal
practices, RCRA also addresses the environmental effects of
certain past waste disposal operations, the recycling of wastes
and the regulation of underground storage tanks containing
regulated substances. In addition, new laws are being enacted
and regulations are being adopted by various regulatory agencies
on a continuing basis, and the costs of compliance with these
new rules can only be broadly appraised until their
implementation becomes more accurately defined.
Pipeline Regulation.
The Railroad Commission of
Texas, or RRC, has authority over some environmental matters
relating to our pipeline. Regulations promulgated by the RRC
address safety issues relating to the transportation of liquids,
and procedures for responding to and reporting releases of crude
oil.
92
Table of Contents
Fuel Regulations.
•
Reformulated Fuels.
EPA regulations also require that
    reformulated gasoline and low-sulfur diesel intended for all
    on-road consumers be produced for ozone non-attainment areas.
    Expenditures necessary to comply with existing reformulated
    fuels regulations are primarily discretionary.
•
Tier 2 Motor Vehicle Emission Standards.
The
    EPA's Tier 2 Motor Vehicle Emission Standards Final
    Rule for all passenger vehicles establishes standards for sulfur
    content in gasoline. These regulations mandate that the average
    sulfur content of gasoline produced at any refinery not exceed
    30 parts per million, or ppm, during any calendar year, and that
    no individual gallon of gasoline exceed 80 ppm, by
    January 1, 2006. The previous standard for maximum per
    gallon sulfur content was gradually reduced from 1000 ppm,
    to 450 ppm, to 300 ppm. Sulfur reduction on this large
    scale is capital intensive for refineries. Generally, refineries
    that met the Small Business Administration definition of a
    "small refiner" (less than 155,000 bpd throughput
    and employ less than 1,500 workers worldwide) and timely
    submitted applications to the EPA have until 2010 to comply. The
    previous owner of our refinery entered into a hardship waiver
    agreement with the EPA in November 2003, which allowed for the
    continued production of gasoline with per batch sulfur levels as
    high as 300 parts per million, and annual average sulfur levels
    not to exceed 156 ppm, until December 2009. We entered into
    a gasoline sulfur compliance plan with the EPA in May 2005
    intended to allow for sufficient time to make the needed
    investments to produce gasoline complying with the new
    standards. Under this agreement, we may continue to produce
    gasoline with a maximum per gallon sulfur level of 300 ppm,
    and an annual average sulfur level not to exceed 156 ppm
    through November 2007, or through May 2008, depending on which
    of the two compliance strategies (set forth in the agreement) is
    utilized. Also, under this agreement, we are obligated to
    produce essentially all of our diesel fuel as ultra-low sulfur
    diesel (less than 15 ppm) by June 1, 2006.
•
Ultra-Low Sulfur Diesel Standards.
The EPA has also
    promulgated on-road diesel regulations, which require a 97%
    reduction in the sulfur content of diesel fuel sold for highway
    use by June 1, 2006, with full compliance by
    January 1, 2010. Additional regulations covering nonroad,
    locomotive and marine diesel have also been promulgated. As of
    March 2005, the refinery was able to produce approximately
    12,000 bpd of ultra-low sulfur diesel. This diesel
    currently satisfies the requirements of both the EPA on-road
    diesel regulation and the Texas Commission on Environmental
    Quality's low emission diesel regulation (referred to as
    the "TxLED" program). Further investment is underway
    to allow for all of the refinery's diesel production to
    meet these new specifications by June 2006, as required by our
    gasoline sulfur compliance plan.
We expect to spend approximately $26.7 million between 2006
and the end of 2007 to comply with the federal Clean Air Act
regulations requiring a reduction in sulfur content in gasoline
and diesel fuel. In addition, we expect to spend approximately
$14.3 million for other environmental improvement projects
through 2010 including approximately $6.7 million for
purchasing and installing a sulfur recovery unit and
approximately $3.0 million for a new electrical substation
in part to comply with a proposed consent decree with the
U.S. Department of Justice and the EPA. Actual costs could,
however, significantly exceed current estimates. Finally, the
Texas Commission on Environmental Quality is in the process of
revising its TxLED regulations, and if the proposed rules are
adopted, we may incur increased compliance costs.
Permits.
Refining companies must obtain numerous permits
that impose strict regulations on various environmental and
safety matters in connection with oil refining. Once a permit
application is prepared and submitted to the regulatory agency,
it is subject to a completeness review, technical review and
public notice and comment period before it can be approved.
Regulatory authorities have considerable discretion in the
timing of the permit issuance and the public has rights to
comment on and otherwise engage in the permitting process,
including through intervention in the courts.
Storage and Sale of Gasoline — Convenience
Stores.
Federal, state, and local regulatory agencies have
adopted regulations governing underground storage tanks, or
USTs, that require us to make certain expenditures for
compliance. In particular, at the federal level, the Resource
Conservation and Recovery Act, or RCRA, required the EPA to
establish a comprehensive regulatory program for the detection,
prevention and
93
Table of Contents
cleanup of leaking USTs. The regulations governing USTs permit
states to develop, administer and enforce their own regulatory
programs, incorporating requirements which are at least as
stringent as the federal standards and are now largely delegated
to the states for implementation.
The EPA and most states have established requirements for:
(1) installing UST systems; (2) upgrading UST systems;
(3) taking corrective action in response to releases;
(4) closing UST systems; (5) keeping appropriate
records; and (6) maintaining evidence of financial
responsibility for taking corrective action and compensating
third parties for bodily injury and property damage resulting
from releases.
We maintain tank compliance through leak-detection systems,
primarily utilizing automatic tank gauging, but also utilizing
inventory control methods, statistical inventory reconciliation,
and interstitial monitoring for leak detection. All of the
systems in place are considered adequate methods of leak
detection.
State Trust Funds.
All states in which we operate
UST systems have established trust funds for the sharing of
liabilities and the recovery and reimbursement of certain
cleanup costs incurred as a result of releases from UST systems.
These trust funds, in essence, provide insurance coverage for
the cleanup of environmental damages caused by the operation of
UST systems, are funded by a UST registration fee and a tax on
the wholesale purchase of motor fuels within each state. Each
trust fund differs by state but in general provides a
$1.0 million cap per incident and a $1.0 million cap
per third-party claim. We have paid UST registration fees and
gasoline taxes to each state where we operate to participate in
these trust programs.
Remediation Efforts — Retail Fuel and
    Convenience Stores and Refinery.
Under the Comprehensive Environmental Response, Compensation and
Liability Act, or CERCLA, RCRA and related state laws, certain
persons may be liable for the release or threatened release of
hazardous substances into the environment. These persons include
the current owner or operator of property where the release or
threatened release occurred, any persons who owned or operated
the property when the release occurred, and any persons who
arranged for the disposal of hazardous substances at the
property. Liability under CERCLA is strict, retroactive and, in
most cases involving the government as plaintiff is joint and
several, so that any responsible party may be liable for the
entire cost of investigating and remediating releases of
hazardous substances. As a practical matter, liability at most
CERCLA and similar sites is shared among all solvent potentially
responsible parties. The liability of a party is determined by
the cost of investigation and remediation, the portion of the
hazardous substance(s) the party contributed to the site, and
the number of solvent potentially responsible parties.
We are currently the responsible party for active UST release
cases at 17 stores in Tennessee, Virginia, and Alabama. In
addition, we are the responsible party for active release cases
involving four stores we no longer own in Alabama. The 21
release cases are the only active release cases for which we are
currently the responsible party. Each of the 21 release cases
for which we are responsible have ongoing environmental
activities and budgets. Our current budget estimate for these 21
sites is $3.5 million. We do not expect to have any further
liability on these 21 sites because either each respective state
fund deductible has been met or the expected liability has been
accrued by us.
The previous owner of the refinery had been engaged for many
years in the investigation and remediation of liquid
hydrocarbons and contaminated soil and groundwater at the
purchased facilities. Upon purchase of the facilities, we became
responsible and liable for the costs associated with the
continued investigation and remediation of known and unknown
impacted areas at the refinery. Although we currently are not
aware of any soil and groundwater contamination at the pipeline
locations requiring investigation or remediation, in the future,
it may become necessary to conduct assessments and remediation
efforts at pipeline locations including
out-of
-service
gathering lines. In addition, we have identified and
self-reported certain other environmental matters subsequent to
our purchase of the refinery. Based upon environmental
evaluations performed by third parties subsequent to our
purchase of the Tyler refinery, we have also recorded an
environmental liability of approximately $7.9 million at
the acquisition date for the estimated costs of environmental
remediation for our refinery and crude oil pipeline. Current and
future environmental regulations as well as other reportable
conditions are expected to require additional expenditures for
94
Table of Contents
investigation and remediation, which may be significant.
Remediation of groundwater at the refinery is expected to
continue for the foreseeable future.
Environmental Indemnity.
In connection with our
April 29, 2005 acquisition of our refinery, the previous
owner agreed, within prescribed limitations to indemnify us
against costs incurred in connection with certain retained
environmental liabilities. We cannot assure you, however, that
this indemnification arrangement will prove to be adequate to
shield us from such liabilities.
Environmental Insurance.
We maintain environmental
pollution and legal liability policies for our retail segment,
which cover certain environmental risks at substantially all of
our retail fuel and convenience stores. In addition, we maintain
a legal liability policy, which covers certain claims and
cleanup costs related to our retail segment's fuel
transportation operations. We also maintain environmental
pollution policies for our refining segment, which cover certain
claims and cleanup costs for new and historical environmental
conditions associated with at our refinery (excluding, among
other things, cleanup costs for historical environmental
conditions at our refinery). To date, no claims have been made
under any of the policies.
Other Governmental Regulation
Our business is subject to other laws and regulations including,
but not limited to, employment laws and regulations, regulations
governing the sale of alcohol and tobacco, minimum wage
requirements, working condition requirements, public
accessibility requirements, citizenship requirements and other
laws and regulations. A violation or change of these laws could
have a material adverse effect on our business, financial
condition and results of operations.
Sale of Alcoholic Beverages.
In areas where our
convenience stores are located, state or local laws limit the
hours of operation for the sale of certain products, the most
significant of which limit or govern the sale of alcoholic
beverages. State and local regulatory agencies have the
authority to approve, revoke, suspend or deny applications for
and renewals of permits and licenses relating to the sale of
alcoholic beverages and to impose various restrictions and
sanctions. In many states, retailers of alcoholic beverages have
been held responsible for damages caused by intoxicated
individuals who purchased alcoholic beverages from them. While
the potential exposure to us for damage claims as a seller of
alcoholic beverages is substantial, we have adopted employee
training procedures intended to minimize such exposure. In
addition, we maintain general liability insurance which may
mitigate the cost of any liability.
Lottery Licenses.
Many of our convenience stores sell
state sponsored lottery tickets and games. The sale, marketing
and display of such items are governed by the applicable
state's gaming laws or the regulations of the issuing state
entity.
Store Operations.
Our stores are subject to regulation by
federal agencies and to licensing and regulations by state and
local health, sanitation, safety, fire and other departments
relating to the development and operation of convenience stores,
including regulations relating to zoning and building
requirements and the preparation and sale of food. Difficulties
in obtaining or failures to obtain the required licenses or
approvals could delay or prevent the development of a new store
in a particular area.
OSHA.
We are also subject to the requirements of the
Federal Occupational Safety and Health Act, or OSHA, and
comparable state statutes that regulate the protection of the
health and safety of workers. In addition, the OSHA hazard
communication standard requires that certain information be
maintained about hazardous materials used or produced in
operations and that this information be provided to employees,
state and local governments and citizens.
Our operations are also subject to federal and state laws
governing such matters as wage rates, overtime, working
conditions and citizenship requirements. At the federal level,
there are proposals under consideration from time to time to
increase minimum wage rates and to introduce a system of
mandated health insurance which could affect our results of
operations.
95
Table of Contents
Employees
As of September 30, 2005, we had 2,436 employees, of which
2,031 were employed either full or part-time by our retail
segment, 223 were employed in our refining segment, and 182 were
employed in our corporate offices. As of December 31, 2005,
149 of the operations and maintenance hourly employees at the
refinery and 11 truck drivers at the refinery were represented
by United Steel, Paper and Forestry, Rubber, Manufacturing,
Energy, Allied Industrial and Service Workers International
Union and its Local 202 and were covered by collective
bargaining agreements. None of our employees in our retail
segment or in our corporate offices are represented by a union.
We consider our relations with our employees to be satisfactory.
Trade Names, Service Marks and Trademarks
We regard our intellectual property as being an important factor
in the marketing of our retail fuel and convenience stores. We
own, have registered or applied for registration of a variety of
trade names, service marks and trademarks for use in our
business, including the following registrations and applications
issued by or filed with the United States Patent and Trademark
Office: MAPCO EXPRESS &
Design
®
,
EAST
COAST
®
,
CAFÉ EXPRESS FINEST COFFEE IN TOWN MAPCO &
Design
®
,
GUARANTEED RIGHT! MAPCO EXPRESS &
Design
®
,
DAVE'S ALL AMERICAN HOT
DOGS
®
,
DELTA
EXPRESS
®
,
MAPCO
MART
tm
,
FLEET
ADVANTAGE
tm
and GRILLE
MARX
tm
.
While we do not have and have not applied for a federally
registered mark for DISCOUNT FOOD
MART
tm
,
we do claim common law trademark rights in the name. Our right
to use the "MAPCO" name is limited to the retail fuel
and convenience store industry. We are not otherwise aware of
any facts which would negatively impact our continuing use of
any of our trade names, service marks or trademarks.
Legal Proceedings
In the ordinary conduct of our business, we are subject to
periodic lawsuits, investigations and claims, including,
environmental claims and employee related matters. Although we
cannot predict with certainty the ultimate resolution of
lawsuits, investigations and claims asserted against us, we do
not believe that any currently pending legal proceeding or
proceedings to which we are a party will have a material adverse
effect on our business, financial condition or results of
operations.
Corporate Structure
Our corporate structure is as set forth in the following diagram:
Delek U.S. Refining GP, LLC owns a 0.1% interest in Delek
Refining Ltd.
96
Table of Contents
MANAGEMENT
Executive Officers, Directors and Key Employees
The following table sets forth the names, ages and positions of
each of our current directors and executive officers and certain
key employees holding positions with us, Delek Refining, Inc.,
our holding company subsidiary for our refining segment, and
MAPCO Express, Inc., our principal operating subsidiary for our
retail segment as of December 31, 2005.
Name
Age
Position
Executive Officers and Directors
Ezra Uzi Yemin
37
President, Chief Executive Officer and Director
Lynwood Gregory
55
Senior Vice President
Frederec Green
40
Vice President and Chief Operating Officer
of Delek Refining, Inc.
Edward Morgan
35
Vice President and Treasurer
Tony McLarty
48
Vice President
Assi Ginzburg
30
Vice President
Paul Pierce
45
Vice President of Marketing
of MAPCO Express, Inc.
Gabriel Last
59
Director
Asaf Bartfeld
53
Director
Ronel Ben-Dov
37
Director
Zvi Greenfeld
59
Director
Key Employees
John Colling, Jr.
49
Treasurer of MAPCO Express, Inc. and Delek Refining, Inc.
Scotty Creason
42
Director of Information Technology of MAPCO Express, Inc. and
    Delek Refining Inc.
Walter Franz
39
Director of Pricing of MAPCO Express, Inc.
Kent Thomas
36
General Counsel and Secretary
Dana Young
45
Vice President of Real Estate of MAPCO Express, Inc.
Set forth below is a brief description of the business
experience of our executive officers and directors listed above.
Ezra Uzi Yemin
has served as our chief executive officer
since June 2004 and as our president and a director since April
2001. Mr. Yemin also served as our treasurer from April
2001 to November 2003 and as our secretary from May 2001 to
August 2005. Mr. Yemin's duties include the
formulation of our policies and direction, oversight of top
executives, and overall responsibility for our operation and
performance. Prior to joining us, Mr. Yemin served from
2000 to 2001 as the chief financial officer of Delek –
The Israel Fuel Corporation, Ltd., the second largest fuel
corporation in Israel and one of our affiliated entities.
Additionally, he spent two years with CLAL Insurance Company
Ltd., the largest insurance company in Israel and two years in
the Insurance Commissioner's Office of the Israel Ministry
of Finance.
Lynwood Gregory
is the chief operating officer for all of
our retail fuel and convenience store operations. He has served
as our senior vice president since November 2003 and has served
as the executive vice president and chief operating officer of
MAPCO Express, Inc. since November 2002. From April 2001 to
November 2002, Mr. Gregory served as a vice president of
operations of MAPCO Express, Inc. Mr. Gregory began his
employment with MAPCO Petroleum, Inc. in 1990 and served as
vice-president of operations and vice-president of marketing for
Williams Express, Inc. prior to our acquisition of the company.
Mr. Gregory
97
Table of Contents
is a thirty-one year veteran of the retail fuel and convenience
store industry. His responsibilities have included all segments
of operations, marketing and food service.
Mr. Gregory's leadership and foresight helped create
our new convenience store concept, which brands a food concept
and enhanced merchandising with the fuel aspect of the business.
Prior to joining MAPCO Petroleum, Inc., Mr. Gregory spent
six years with Georgia Southern Oil, two years with Starvin
Marvin/ Globe Oil, and eight years with Crown Central Petroleum,
all in upper management/executive positions, developing their
presence in the Southeast.
Frederec Green
has served as vice president of Delek
Refining, Inc. since February 2005 and as its chief operating
officer since May 2005, and is the primary operational officer
for our refining and wholesale marketing operations. Prior to
joining us, from January 2004 to January 2005, Mr. Green
operated Green Energy Advisors LLC, an independent consulting
practice servicing commercial insurance carriers on petroleum
refining and electrical matters. Mr. Green has
18 years experience in the refining industry working for
UOP LLC, a refinery technology licensing firm, from 1987 to
1990 and Murphy Oil USA, Inc., from 1990 to 2004, where he
served as a senior vice president during his last
six years. Mr. Green has experience ranging from crude
oil and feedstock supply, through all aspects of managing a
refining business to product trading, transportation and sales.
Edward Morgan
is our principal financial officer and has
served as our treasurer since November 2003 and as vice
president since February 2005. Mr. Morgan has also served
as a member of management of our subsidiaries and is currently
the chief financial officer of both MAPCO Express Inc. and Delek
Refining, Inc. with responsibility for all finance and
accounting matters, as well as our company's information
technology infrastructure. Prior to joining us in May 2002,
Mr. Morgan was a senior member of management with American
HomePatient, Inc., a provider of home health care services and
products, where he was the director of treasury operations from
1997 to May 2002. Prior to that, Mr. Morgan spent several
years as a certified public accountant at Deloitte and Touche,
LLP. Throughout his career, Mr. Morgan has been involved in
debt restructuring, acquisitions and divestitures.
Mr. Morgan is a member of the American Institute of
Certified Public Accountants, the Association for Financial
Professionals, and the Tennessee Society of Certified Public
Accountants. He serves on the board of directors for the Ronald
McDonald House of Tennessee charities and serves on the Retailer
Advisory Board for the Tennessee Education Lottery Corporation.
Tony McLarty
is our principal human resources officer and
has served as vice president since February 2005. He is a
23 year veteran of the hospitality industry with a
multi-dimensional background and functional strengths ranging
from operations to administration. From August 1995 to September
2002, Mr. McLarty was the senior director of human
resources at Logan's Roadhouse, where his responsibilities
included the supervision of 7,600 employees and a variety of
positions in human resources, recruiting, training, operations
and administration. Prior to that, Mr. McLarty held
positions at Morison's Specialty Restaurants and Southern
Hospitality Corporation and has worked for both public and
private companies. Mr. McLarty also serves as a director of
Levy's Inc. and is active in several charitable
organizations.
Assi Ginzburg
is our principal strategic planning officer
and has served as vice president since February 2005. Prior to
joining us in November 2004, Mr. Ginzburg served as a
financial advisor from July 2001 to March 2003 for Swary-Yohman
Financial Consultants, and from April 1999 to July 2001 for
Itzhak Swary Ltd., two consulting firms in Israel.
Mr. Ginzburg has been a member of the Israel Institute of
Certified Public Accountants since 2001 and served as trustee of
court for a large Israeli public company in 2003 and 2004.
Paul Pierce
has served as vice president of marketing of
MAPCO Express, Inc. since September 2004. Prior to joining us,
Mr. Pierce was self-employed as a consultant from January
2004 through August 2004, developing convenience stores for
D&D Oil, Inc. From 1997 to December 2003, he held executive
level positions at Golden Gallon, Inc., a convenience store
chain, where his responsibilities included managing all
merchandise sales, vendor negotiations and contracts, retail
pricing, advertising, imaging, store layouts and design,
budgeting and operations team oversight. Throughout his
20 years in the retail fuel and convenience store industry,
he has held a variety of marketing roles that include vice
president of marketing, director of merchandising, field
marketing manager and director of advertising. In addition to
the positions listed above,
98
Table of Contents
Mr. Pierce has been employed by Crown Central Petroleum
Corporation, Kangaroo, Inc., and Palmetto Merchandise, Inc.
Gabriel Last
has served as a director since January 2002.
Mr. Last has served as the chief executive officer of Delek
Group Ltd., our parent company from 2001 to 2003. From 1998 to
2001, Mr. Last served as general manager of the Insurance
Companies Union in Israel. In addition, since 2003,
Mr. Last has served as the chairman of the board of Delek
Group Ltd., our parent company, and currently serves on the
board of directors of several of our other affiliated entities,
including, Matav-Cable Systems Media Ltd. Mr. Last also
serves on the board of Sinel Industries Ltd., an unaffiliated
public company in Israel.
Asaf Bartfeld
has served as a director since January
2002. Mr. Bartfeld has served as the president and chief
executive officer of Delek Group Ltd. our parent company, since
September 2003. Since July 2001, he has served as general
manager of Delek Investments and Properties Ltd, one of our
affiliated entities. Mr. Bartfeld also serves on the board
of directors of several of our affiliated entities, including
Delek Group Ltd., our parent company, and Matav-Cable Systems
Media Ltd.
Ronel Ben-Dov
has served as a director since February
2005. Mr. Ben-Dov has served as the chief financial officer
and vice president of Delek Group Ltd., our parent company,
since May 2004. Prior to that, Mr. Ben-Dov was a partner at
Kost Forer Gabbay & Kasierer, a member of the
Ernst & Young global organization, from December 2003
to April 2004. From April 2000 to November 2003,
Mr. Ben-Dov served as a partner/manager at Luboshitz
Kasierer, which was affiliated with Arthur Andersen &
Co. Socièté until 2002 and then became a member of the
Ernst & Young global organization. Mr. Ben-Dov
also serves at a director of several of our affiliated entities.
Zvi Greenfeld
has served as a director since October
2005. Mr. Greenfeld has served as the president of one of
our affiliated entities, Delek Drilling Management Ltd., since
1993, where he oversees that company's exploration and
production of natural gas in Israel. Mr. Greenfeld is the
principal of Greenfeld-Energy Consulting, Ltd. a company that
has provided consulting services to us since May 2005. He has
also been a consultant for Delek – The Israel Fuel
Corporation Ltd., another affiliate, since 2002, advising senior
management on fuel purchases. From 1991 to 2002,
Mr. Greenfeld served as a vice president of
Delek – The Israel Fuel Corporation Ltd., where among
other things he directed the building and renovation of retail
gas stations and managed quality control and fuel purchasing.
Additionally, Mr. Greenfeld serves as a director of several
of our affiliated entities.
Set forth below is a brief description of the business
experience of our key employees listed above.
John Colling, Jr.
has served as the treasurer of
MAPCO Express, Inc. and Delek Refining, Inc. since July 2005.
From November 2003 to July 2005, Mr. Colling was the
treasurer of Nu-kote International, Inc., a manufacturer
and distributor of ink and toner printer cartridges, and from
July 1990 to September 2003, Mr. Colling served as the vice
president and treasurer of Magnetek, Inc., a provider of digital
power and electronic products. As treasurer of those companies,
he was responsible for world-wide treasury activities including,
mergers and acquisitions, corporate finance transactions,
corporate risk management and financial planning.
Scotty Creason
has served as the director of information
technology for MAPCO Express, Inc. since December 2002 and for
Delek Refining, Inc. since February 2005. From April 2001 to
December 2002, Mr. Creason served as IT project manager of
MAPCO Express, Inc. Mr. Creason began his employment with
MAPCO Petroleum, Inc. in 1994 and has held the positions of
field engineer, developer, EDI coordinator, and IT project
manager. Mr. Creason was instrumental in designing,
developing and managing our current IT infrastructure and
systems, and has been an integral part of our mergers and
acquisitions team. Mr. Creason has over 20 years of IT
experience in various industries including real estate and
manufacturing.
Walter Franz
joined MAPCO Express Inc. in May 2003 and
has served as the director of pricing since May 2004. Prior to
joining us, Mr. Franz worked in both the retail and
healthcare industries, where he had extensive background in
pricing, inventory management, merchandise planning and
analysis. From August 1997 to January 2002, Mr. Franz
worked for Service Merchandise Company, Inc., a retail company,
as manager of inventory control and as director of merchandise
planning and was responsible for the analysis
99
Table of Contents
and planning of 34 business units. From January 2002 to May
2003, Mr. Franz worked as director of inventory management
at Shop at Home, Inc. Throughout his career, Mr. Franz has
been involved in revenue and margin enhancement, strategic
planning and analysis and process improvement.
Kent Thomas
has served as our general counsel and
secretary since August 2005. Mr. Thomas has over nine years
experience practicing law in Nashville, Tennessee. Prior to
joining us, Mr. Thomas spent four years at the firm of
Colbert & Winstead, PC, and the prior four years at the
Gordon Law Group PLC, both of Nashville, Tennessee, with a
practice focused on litigating employment, commercial and
copyright disputes and providing transactional representation in
the banking, transportation, entertainment, restaurant and
alcoholic beverage retail industries. Mr. Thomas serves as
an adjunct instructor in intellectual property and legal ethics
at Southeastern Career College.
Dana Young
has served as vice president of real estate of
MAPCO Express, Inc. since April 2005. His responsibilities
include overseeing the development of new stores, including site
selection, acquisition, design and construction, the maintenance
and renovation of existing stores and the disposition of
selected stores. Mr. Young has twenty-three years of real
estate development experience. From April 2003 to April 2005, he
served as senior vice president of Bank Atlantic, a financial
institution based in Florida, where he managed the corporate
real estate department. From January 2002 to April 2003,
Mr. Young served as president of Real Estate &
Construction Management Associates, a full service real estate
consulting firm. From August 1999 to January 2002,
Mr. Young served as senior vice president of SouthTrust
Bank, where he managed their corporate real estate department.
Composition of the Board of Directors After This Offering
Our board of directors currently consists of five members, none
of which are independent directors. We are currently recruiting
independent directors to serve on our board of directors. In
compliance with the requirements of the Sarbanes-Oxley Act of
2002, the rules of the NYSE and SEC rules and regulations, a
majority of the directors on our audit committee will be
independent within 90 days of listing on the NYSE and,
within one year of listing, this committee will be fully
independent.
The directors are elected at the annual meeting of stockholders.
Our directors hold office until the earlier of their death,
resignation or removal or until their successors have been
elected and qualified. There are no family relationships among
any of our directors or executive officers.
Controlled Company
Our board of directors has determined that we are a
"controlled company" for the purposes of
Section 303A of the NYSE Listed Company Manual because
Delek Group Ltd. indirectly holds more than 50% of the voting
power of our company. Following this offering, we intend to
utilize some or all of the "controlled company"
exemptions of the NYSE corporate governance standards. These
exemptions will free us from the obligation to comply with
certain NYSE corporate governance requirements that would
otherwise require us, among other things, to have a board of
directors composed of a majority of independent directors, to
have a compensation committee composed of independent directors
and to have a nominating and corporate governance committee. We
do plan, however, to appoint at least one independent director
to the board prior to completion of this offering. See
"Risk Factors — Risks Related to Our Common Stock
and this Offering".
Committees of the Board of Directors
Audit Committee
Prior to the completion of this offering, we will establish an
audit committee comprised of three directors, at least one of
whom will be "independent" as defined under and
required by the federal securities laws and the NYSE rules.
Because this offering is our initial public offering, the NYSE
permits us to phase-in the independence of our audit committee.
Upon completion of this offering, we will be required to have
one independent audit committee member. We will be required to
have a majority of independent members
100
Table of Contents
approximately 90 days after the date of this prospectus and
to have all independent audit committee members approximately
one year after the date of this prospectus. We anticipate
that                     will
be designated by our board of directors as the audit committee
"financial expert" (as defined in the applicable
regulations of the SEC). The audit committee will operate under
a written charter adopted by the board of directors which
reflects standards set forth in SEC regulations and NYSE rules.
The composition and responsibilities of the audit committee and
the attributes of its members, as reflected in the charter, are
intended to be in accordance with applicable requirements for
corporate audit committees. The charter will be reviewed, and
amended if necessary, on an annual basis. The full text of the
audit committee's charter will be available on our website
at www.delekus.com.
As will be set forth in more detail in the charter, the audit
committee will assist the board in fulfilling its oversight
responsibility relating to our financial statements and the
disclosure and financial reporting process, our system of
internal controls, our internal audit function, the
qualifications, independence and performance of our independent
auditors, compliance with our code of business conduct, and
ethics and legal and regulatory requirements. The audit
committee will have the sole authority to appoint, retain,
terminate, compensate and oversee the work of the independent
auditors, as well as to pre-approve all audit and non-audit
services to be provided by the independent auditors.
Compensation Committee
Prior to the completion of this offering, we will establish a
compensation committee comprised of three directors. The
compensation committee will operate under a written charter
adopted by the board of directors. The committee will be
responsible for administering any incentive compensation plans,
equity-based compensation plans and other benefit plans and
making recommendations to the board of directors with respect to
such plans. Also, the committee will evaluate the chief
executive officer's performance, determine compensation
arrangements for all of our executive officers, including our
chief executive officer, and make recommendations to the board
of directors concerning compensation policies for us and our
subsidiaries.
Compensation Committee Interlocks and Insider
Participation.
None of our executive officers serves as a
member of the compensation committee or board of directors of
any other entity that has an executive officer serving as a
member of our board of directors or compensation committee.
Director Compensation
We do not currently pay any director fees to any of our
directors. In conjunction with this offering, we will be adding
independent directors to our board of directors and plan to pay
our non-employee directors an annual cash fee of
$           and
an additional fee of
$           per
meeting attended. Each non-employee committee member will
receive a fee of
$           per
committee meeting attended. In addition, our non-employee
directors will receive
annually                     stock
options
and                      restricted
stock units or restricted shares which will vest in equal
amounts over a four year period. We will also reimburse our
directors for all reasonable expenses incurred for attending
meetings and service on our board of directors. See
"Management — IPO Awards" for information
regarding stock option and restricted stock unit awards to be
granted to non-employee directors in connection with this
offering.
101
Table of Contents
Executive Compensation
The following table sets forth information regarding
compensation awarded to, earned by, or paid to our president and
chief executive officer and our four other most highly
compensated executive officers for fiscal year 2005. We
sometimes refer to these executives as the "named executive
officers" elsewhere in this prospectus.
Summary Compensation Table
Annual Compensation
All Other
Compensation
Name and Principal Position
Salary($)
Bonus($)(1)(2)
($)(4)
Ezra Uzi Yemin
President and Chief Executive Officer
$
261,692
$
350,000
(3)
$
49,323
Lynwood Gregory
Senior Vice President of Delek US
$
177,230
—
$
12,741
Frederec Green
Chief Operating Officer of Delek Refining
$
158,173
$25,000
$141
Edward Morgan
Vice President and Treasurer
$
150,000
$20,000
$
11,622
Tony McLarty
Vice President
$
140,000
$20,000
$
10,918
(1)
Represents a one-time special bonus paid in May 2005 upon the
    completion of the Tyler refinery acquisition.
(2)
Annual bonuses for fiscal year 2005 have not yet been
    determined. It is our practice to evaluate the eligibility of
    officers for bonuses in March and make payments in April based
    on company and individual performance.
(3)
Includes an additional $200,000 bonus paid on February 6,
    2006.
(4)
Includes the following payments for each named executive
    officers:
Premiums paid by us with
Severance and
Matching contributions to
respect to term life
vacation payments
our 401(k) plan
insurance policies
accrued in fiscal 2005
Ezra Uzi Yemin
$
13,182
$
141
$
36,000
(1)
Lynwood Gregory
$
12,600
$
141
—
Frederec Green
—
$
141
—
Edward Morgan
$
11,481
$
141
—
Tony McLarty
$
10,777
$
141
—
(1)
Includes $12,000 in accrued severance payments and $24,000 in
    unused accrued vacation days that are payable upon termination
    of employment. See "— Employment Agreement with
    President and Chief Executive Officer".
102
Table of Contents
The following table shows information about the value of our
named executive officers' unexercised options as of
December 31, 2005. None of our named executive officers
exercised options in 2005.
Aggregated Option Exercises in Last Fiscal Year and Fiscal
Year-End Option Values
Number of Securities
Value of Unexercised In-
Underlying Unexercised
The-Money Options at
Options at Fiscal Year End
Fiscal Year End(1)
Name
Exercisable
Unexercisable
Exercisable
Unexercisable
Ezra Uzi Yemin
Lynwood Gregory
—
—
—
—
Frederec Green
—
—
—
—
Edward Morgan
—
—
—
—
Tony McLarty
—
—
—
—
(1)
The dollar values have been calculated by determining the
    difference between the fair market value of the securities
    underlying the options at December 31, 2005 and the
    exercise prices of the options. Solely for purposes of
    determining the value of the options at December 31, 2005
    we have assumed that the fair market value of the common stock
    issuable upon exercise of options was
    $          ,
    the assumed initial public offering price, which is the midpoint
    of the range set forth on the cover page of this prospectus,
    since our common stock was not traded on an established market
    prior to this offering. The above calculations for
    Mr. Yemin assume completion of this offering.
Employment Agreement with President and Chief Executive
Officer
We and our subsidiary, MAPCO Express, entered into an employment
agreement with Ezra Uzi Yemin, our president and chief executive
officer, effective May 1, 2004, which has been subsequently
amended. The amended agreement provides for Mr. Yemin to
serve as the president and chief executive officer of MAPCO
Express through April 30, 2009, unless the agreement is
terminated earlier by any party for any reason upon
12 months notice or Mr. Yemin's death.
Mr. Yemin is entitled to a base salary of $24,000 per
month and is eligible to receive an annual performance bonus at
the sole discretion of our board of directors. Mr. Yemin
may participate in any benefit plans, policies, programs and
payroll practices that MAPCO Express makes available to other
employees. The employment agreement also entitles Mr. Yemin
to specified perquisites and other personal benefits.
Pursuant to the employment agreement, Mr. Yemin has been
granted share purchase rights that permit him to purchase,
subject to certain vesting requirements, up
to                      shares
of our common stock, representing 5% of our shares outstanding
immediately prior to the completion of this offering. These
share purchase rights become exercisable, subject to vesting,
upon the completion of this offering, provided Mr. Yemin is
employed by MAPCO Express at the time. Under the applicable
vesting provisions, Mr. Yemin will be entitled to purchase
up to one-fifth of these shares for each year of his employment
(pro rated monthly) from May 2004 until the expiration of the
employment agreement in April 2009. Mr. Yemin may purchase
these shares at an exercise price of
$          per
share, which is based upon an assumed total market value of our
equity of $80.0 million at May 1, 2004, the date of
grant.
The share purchase rights terminate upon the earlier of
(i) the one-year anniversary of Mr. Yemin's
termination of employment for any reason or (ii) April 30,
2010, the one-year anniversary of the expiration of his
employment agreement. If Mr. Yemin voluntarily terminates
his employment, he will be entitled to purchase 90% of any
unexercised share purchase rights which have vested as of the
date of such termination.
For information regarding the value of these share purchase
rights, see the table captioned "Aggregated Option
Exercises in Last Fiscal Year and Fiscal Year-End Option
Values" under "Executive Compensation" above. See
"Management's Discussion and Analysis of Financial
Condition and Results of Operations — Factors
Affecting Comparability" for a discussion of the
anticipated effect of these share purchase rights and stock
options to be granted in connection with this offering on our
future results.
103
Table of Contents
Upon the expiration of the employment agreement or its
termination by us, MAPCO Express or Mr. Yemin,
Mr. Yemin is entitled to a continuation of his base salary
for a period of one month. During any such salary
continuation period, if Mr. Yemin resides in the United
States, he will be entitled to continue to receive all of the
perquisites and other personal benefits provided for in the
agreement. If Mr. Yemin resides in Israel during any salary
continuation period, he will be entitled to specified
perquisites and other personal benefits. In the event that the
agreement is terminated by any party for any reason prior to its
expiration, Mr. Yemin will also be entitled to severance
payments of $1,000 for each full month of employment with MAPCO
Express or its affiliates from January 2005 through the date of
termination, and to payment for unused vacation days accrued
through the date of termination. Furthermore, in the event no
shares underlying the share purchase rights have been issued to
Mr. Yemin by April 30, 2009, upon the earlier of
(i) termination of the agreement by any party for any
reason prior to its expiration or (ii) a change in control
(as defined in the agreement) of MAPCO Express, Mr. Yemin
will be entitled to receive an additional bonus payment not to
exceed $3.0 million, if we meet specified pre-tax profit
targets. However, if Mr. Yemin voluntarily terminates his
employment prior to the issuance of shares underlying his share
purchase rights, he will be entitled to receive 90% of such
additional bonus payment or to purchase 90% of any vested
and unexercised share purchase rights accrued or vested through
the date of such termination.
In the event that Mr. Yemin decides to sell any shares
purchased through the exercise of his share purchase rights to a
third party, MAPCO Express has an exclusive right of first
refusal to purchase the shares. Additionally, if
Mr. Yemin's employment agreement is terminated for any
reason, MAPCO Express has the right during the ten-day period
following the date of termination to purchase some or all of the
shares held by Mr. Yemin, if any, at a purchase price equal
to the fair market value of the shares.
Delek US Holdings, Inc. 2006 Long-Term Incentive Plan
The following contains a summary of the material terms of our
2006 long-term incentive plan, which will be adopted by our
board of directors and approved by our stockholder prior to the
closing of this offering. The plan will enable us to attract,
motivate, reward and retain key personnel through the grant of
equity and cash-based incentive awards. The plan permits us to
grant stock options, stock appreciation rights, restricted
stock, restricted stock units and other stock-based awards and
cash incentive awards to directors, officers, employees,
consultants and other individuals (including, advisory board
members) who perform services for us or our affiliates.
Generally, the compensation committee will administer the plan,
will have discretion to select the persons to whom awards will
be made under the plan and prescribe the terms and conditions of
each award under the plan. The board of directors also has the
power to administer the plan. With respect to the application of
the plan to non-employee directors, the board of directors will
have sole responsibility and authority for matters relating to
the grant and administration of awards. Subject to applicable
law, the compensation committee also has discretion to delegate
all or a portion of its authority under the plan.
Up
to                      shares
of our common stock may be issued under the plan (subject to
adjustment to reflect certain transactions and events specified
in the plan). Shares covered by the unexercised portion of an
award that terminates, expires or is canceled or settled in
cash, shares forfeited or repurchased under the plan, and shares
withheld or surrendered in order to pay the exercise or purchase
price under an award or to satisfy the tax withholding
obligations associated with the exercise, vesting or settlement
of an award will again become available for issuance under the
plan.
The compensation committee may grant stock options (including
non-qualified and incentive stock options) and stock
appreciation rights under the plan. A stock appreciation right
entitles the recipient to receive the excess of the fair market
value of a share of our common stock on the date of exercise
over the designated base price of the stock appreciation right.
The exercise price of an option and the base price of a stock
appreciation right will be determined by the compensation
committee, but may not be less than the fair market value of the
underlying shares on the date of grant. The compensation
committee will determine the term of each option and stock
appreciation right, but the maximum term of each option and
stock appreciation right will be ten years. Subject to this
limit, the times at which each will be exercisable and
104
Table of Contents
provisions requiring forfeiture of unexercised options or stock
appreciation rights at or following termination of employment or
other service or upon the occurrence of other events generally
are fixed by the compensation committee. The methods by which
the exercise price of a stock option may be paid or deemed to be
paid and the form of such payment (including, cash, shares of
our common stock, and other awards) will be determined by the
compensation committee. The methods of exercise and settlement,
the form of consideration payable on settlement and other terms
of stock appreciation rights will be determined by the
compensation committee.
The compensation committee may also grant restricted stock and
restricted stock units under the plan. Prior to the end of the
restricted period, shares of restricted stock may not be
transferred, and will be forfeited in the event of termination
of employment or other service in specified circumstances. The
compensation committee will establish the length of the
restricted period for awards of restricted stock. Aside from the
risk of forfeiture and non-transferability, an award of
restricted stock entitles the recipient to the rights of a
holder of our common stock, including the right to vote the
shares and to receive dividends (subject to any mandatory
reinvestment or other requirements imposed by the compensation
committee).
Restricted stock units confer upon the recipient the right to
receive shares of our common stock at the end of a specified
deferral or vesting period. The compensation committee will
establish any vesting requirements for restricted stock units
granted for continuing services. Prior to settlement, restricted
stock unit awards carry no voting or dividend rights or other
rights associated with ownership of our common stock, but
dividend equivalents will be paid or accrue unless otherwise
determined by the compensation committee.
The plan authorizes the compensation committee to grant short
term and long term cash incentive awards as well as other types
of awards that are denominated or payable in, valued in whole or
in part by reference to, or otherwise based on or related to our
common stock including, without limitation, stock bonuses,
dividend equivalents, convertible or exchangeable debt
securities, other rights convertible or exchangeable into our
common stock, purchase rights for our common stock, awards with
value and payment contingent upon our performance or the
performance of any of our business units or any other factors
designated by the compensation committee, and awards valued by
reference to the book value of our common stock or the value of
securities of or the performance of our subsidiaries or
affiliates or other business units and awards designed to comply
with or take advantage of other applicable local laws or
jurisdictions other than the United States. Cash incentive
awards, including annual incentive awards and long-term
incentive awards will be earned at such times, and under such
circumstances, including the degree of attainment of performance
goals or future service requirements as the compensation
committee may determine. The compensation committee will
determine the terms and conditions of all such awards.
Unless sooner terminated by the board of directors, the plan
shall expire on the tenth anniversary of the date of its
adoption by the board of directors. The board of directors may
amend or terminate the plan at any time, provided, however, that
no such action may adversely affect a holder's rights under
an outstanding award without the holder's written consent.
Any amendment to the plan that would increase the aggregate
number of shares of our common stock issuable under the plan,
that would modify the class of persons eligible to receive
awards under the plan or that would otherwise be required to be
approved by our stockholders under applicable law or the
requirements of any stock exchange or market upon which our
common stock may then be listed shall be subject to the approval
of our stockholders.
The plan is intended to constitute a plan described in Treasury
Regulation Section 1.162-27(f)(1), pursuant to which
the deduction limits under Section 162(m) of the Internal
Revenue Code do not apply during the applicable reliance period.
In general, the reliance period ends upon the earliest of:
(i) the expiration of the plan; (ii) the material
modification of the plan; (iii) the issuance of all
available stock and other compensation that has been allocated
under the plan; or (iv) the first stockholder meeting at
which directors are to be elected that occurs after the close of
the third calendar year in which we became publicly held.
105
Table of Contents
IPO Awards
We plan to grant an aggregate
of                     stock
options upon the completion of this offering to certain officers
and employees and our non-employee directors under our 2006
long-term incentive plan, which options will have an exercise
price equal to the initial public offering price of our common
stock. In addition, we plan to award an aggregate
of                     restricted
stock units to certain officers and employees and our
non-employee directors upon the filing of a registration
statement on
Form
S-8
registering the shares of our common stock issuable under our
2006 long-term incentive plan, which
Form
S-8
we intend
to file 30 days after the completion of this offering. The
stock options and restricted stock units will vest in annual
installments on the first four anniversaries of the date of
completion of this offering.
Our 401(k) Plan
We sponsor a voluntary 401(k) Employee Retirement Savings Plan
for eligible employees administered by Fidelity Management Trust
Company. Employees must be at least 21 years of age and
have one year of service with at least 1,000 hours worked
to be eligible to participate in the plan. Employee
contributions are matched on a fully-vested basis by us up to a
maximum of 6% of eligible compensation.
106
Table of Contents
PRINCIPAL STOCKHOLDERS
Beneficial Ownership of Our Common Stock
The following table sets forth information regarding the
beneficial ownership of our common stock upon completion of this
offering by:
•
each person or entity who is known by us to beneficially own 5%
    or more of our outstanding common stock;
•
each of our directors;
•
each of our executive officers named in the Summary Compensation
    Table; and
•
all our directors and executive officers as a group.
The amounts and percentage of common stock beneficially owned
are reported on the basis of regulations of the SEC governing
the determination of beneficial ownership of securities. Under
the rules of the SEC, a person is deemed to be a
"beneficial owner" of a security if that person has or
shares "voting power," which includes the power to
vote or to direct the voting of such security, or
"investment power," which includes the power to
dispose of or to direct the disposition of such security. A
person is also deemed to be a beneficial owner of any securities
of which that person has a right to acquire beneficial ownership
within 60 days. Under these rules, more than one person may
be deemed a beneficial owner of the same securities and a person
may be deemed a beneficial owner of securities as to which he
has no economic interest. The number of shares of common stock
outstanding used in calculating the percentage for each listed
person includes the shares of common stock underlying options or
share purchase rights held by such person that are, or within
60 days after the date of this prospectus will become,
exercisable, but excludes shares of common stock underlying
options or share purchase rights held by any other person.
Except as indicated by footnote, the persons named in the table
have sole voting and investment power with respect to all shares
of common stock shown as beneficially owned by them, subject to
community property laws where applicable.
Percentage of beneficial ownership after the transaction is
based
on                      shares
of common stock outstanding at the completion of this offering.
The table assumes that the underwriters' option to purchase
additional shares is not exercised and excludes any shares
purchased in this offering by the respective beneficial owners.
Unless otherwise indicated below, each person or entity has an
address in care of our principal executive offices at 830
Crescent Centre Drive, Suite 300, Franklin, Tennessee 37067.
Before Offering
After Offering(1)
Number of
Percentage of
Number of
Percentage of
Shares
Shares
Shares
Shares
Beneficially
Beneficially
Beneficially
Beneficially
Name of Beneficial Owners, Directors and Executive Officers
Owned
Owned
Owned
Owned
Delek Group Ltd.(2)(3)
Yitzchak Sharon Teshuva(4)
Delek Petroleum Ltd.(2)(3)
Delek Hungary Holding Ltd.(2)(3)
Ezra Uzi Yemin(5)
Lynwood Gregory
Frederec Green
Edward Morgan
Tony McLarty
Gabriel Last
Asaf Bartfeld
Ronel Ben-Dov
Zvi Greenfeld
All current directors and executive officers as a group
    (11 persons)
107
Table of Contents
(1)
The number of shares of common stock to be outstanding after the
    offering:
•
gives effect to
    a
-for-one
stock split of our common stock, which will be effective
    immediately prior to this offering;
•
excludes                      shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $           per
    share;
•
excludes                      shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;
•
excludes                      shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form
S-8
registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form
S-8
we intend
    to file within 30 days after the completion of this
    offering;
•
excludes                      shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan; and
•
assumes no exercise by the underwriters of their option to
    purchase up
    to                     additional
    shares of common stock from us if they sell more
    than                      shares
    in the offering.
(2)
Delek Group Ltd. is the parent company of Delek Petroleum Ltd.,
    and Delek Petroleum Ltd. is the parent company of Delek Hungary
    Holding Ltd., the record owner of all of our outstanding shares
    of common stock prior to this offering. Each entity may
    therefore, be deemed to beneficially own the shares held by
    Delek Hungary Holding Ltd.
(3)
The address of Delek Group Ltd. and Delek Petroleum Ltd. is Bet
    Adar Building, 7 Giborei Israel Street, P.O.B. 8464, New
    Industrial Park, Natanya (South) 42504, Israel. The address of
    Delek Hungary Holding Ltd. is 1134 Budapest, Vaci ut 35, Hungary.
(4)
Mr. Teshuva beneficially owns 64.4% of the outstanding
    equity and voting ordinary shares of Delek Group Ltd. through
    two corporations that he controls. Mr. Teshuva may be
    deemed to be a beneficial owner of the common stock beneficially
    owned by Delek Group Ltd. Mr. Teshuva disclaims beneficial
    ownership of the common stock beneficially owned by Delek Group
    Ltd. pursuant to the rules promulgated under the Securities
    Exchange Act of 1934, as amended, or Exchange Act, except to the
    extent of his pecuniary interest therein. This information is as
    of January 11, 2006, and is based on filings made by Delek
    Group Ltd. with the Israel Securities Authority.
(5)
Consists
    of                      shares
    that Mr. Yemin has the right to purchase within
    60 days of the date of this prospectus, assuming the
    completion of this offering.
108
Table of Contents
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
General
Immediately prior to this offering, Delek Group Ltd. owned all
our outstanding shares of common stock through Delek Hungary
Holding Ltd., an indirect wholly-owned subsidiary. After this
offering, Delek Group Ltd., through Delek Hungary Holding Ltd.,
will own      % of the outstanding
shares of our common stock. If the underwriters' option to
purchase additional shares is exercised in full, immediately
following this offering, Delek Group Ltd., through Delek Hungary
Holding Ltd., will own      % of our
common shares. For as long as Delek Group Ltd., through Delek
Hungary Holding Ltd., continues to own shares of common stock
representing more than 50% of the total voting power of our
common stock, Delek Group Ltd. will continue to have the power
acting alone to approve any action requiring a vote of the
majority of our voting shares and to elect all of our directors.
Equity Investment in EL-AD DELEK LLC
Between June 20, 2002 and December 31, 2003, we were
the nominee of our affiliates Delek – The Israel Fuel
Corporation Ltd. and Delek Motors Ltd., each a subsidiary of
Delek Group Ltd., with regard to a two-thirds membership
interest in another affiliate, El-Ad Delek LLC, a Delaware
limited liability company. The two-thirds membership interest in
El-Ad Delek LLC was beneficially owned in equal amounts by those
affiliates and held of record by us. El-Ad Delek LLC is
principally engaged in the ownership and charter operations of a
corporate aircraft based in New Jersey. During this period we
did not invest any amounts in this entity, did not exercise
control over this entity and were not entitled to any of the
economic benefits or risks of loss of ownership. On
December 31, 2003, we agreed to terminate this nominee
arrangement so that Delek – The Israel Fuel
Corporation Ltd. and Delek Motors Ltd. would become record, as
well as beneficial, owners of their respective one third
beneficially-owned interests in El-Ad Delek LLC held by us as
nominee.
We purchased the one-third interest owned by Delek –
The Israel Fuel Corporation Ltd., pursuant to a purchase
agreement stated to be effective as of December 31, 2003.
As consideration for the sale of the interest, we executed and
delivered to Delek – The Israel Fuel Corporation Ltd.
a variable rate promissory note in the amount of approximately
$6.7 million for which the entire principal balance and
interest was due in full on January 1, 2009. The note bore
interest based on LIBOR plus 1.50% per year. In May 2004,
we agreed with Delek – The Israel Fuel Corporation
Ltd., effective as of December 31, 2003, to terminate the
purchase agreement, to cancel the variable rate promissory note,
and to rescind the sale of the one-third interest of
Delek – The Israel Fuel Corporation Ltd. in El-Ad
Delek LLC.
Notes Payable to Related Parties
In addition to the variable rate promissory note issued in
connection with the purchase of our membership interest in El-Ad
Delek LLC, we have issued the following promissory notes payable
to Delek — The Israel Fuel Corporation Ltd. and Delek
Group Ltd., two of our affiliates.
On February 26, 2003, to partially finance our purchase of
seven Tennessee convenience stores from Pilot Travel Centers,
LLC, we signed a promissory note payable to Delek –
The Israel Fuel Corporation Ltd. in the amount of
$3.5 million. The promissory note bore interest at a rate
of 4.0% per year. On August 17, 2004, we modified the
maturity date of this note payable from August 26, 2004 to
December 31, 2005. On May 24, 2005, we repaid all
interest and principal due under the note.
On April 28, 2004, to partially finance our purchase of
Williamson Oil Co., Inc., we signed a promissory note payable to
Delek – The Israel Fuel Corporation Ltd. in the
principal amount of $25.0 million. The note bears interest
at a rate of 6.30% per year with interest and principal
payments due upon maturity on April 27, 2008. We intend to
use a portion of the net proceeds from this offering to repay
all interest and principal due under the note.
On April 27, 2005, to partially finance our purchase of our
refinery, we signed a note payable to Delek Group Ltd., in the
amount of $35.0 million. The note bears interest at a rate
of 7.0% per year, which is due
109
Table of Contents
and payable in semi-annual installments, commencing July 1,
2007. The entire principal amount plus accrued and unpaid
interest is due upon maturity on April 27, 2010. On
November 23, 2005, we repaid $17.5 million of the
principal and all accrued interest through that date under the
note. We intend to use a portion of the net proceeds from this
offering to repay all remaining principal and interest due under
the note.
Guarantees by Affiliates
In connection with a Credit Agreement with Bank of Leumi and
Bank Hapoalim BM that we entered into on July 31, 2002, and
which was amended and restated on April 28, 2004,
Delek – The Israel Fuel Corporation Ltd. entered into
a limited guaranty in favor of Bank of Leumi and Bank Hapoalim
BM, the general terms of which required Delek – The
Israel Fuel Corporation Ltd. to guaranty payment of a
significant portion of our obligation, if we were unable to
perform our payment obligations under the Credit Agreement. The
guaranty was to expire on the earlier of July 1, 2011 or
the complete payment and satisfaction of all amounts outstanding
under the Credit Agreement. In May 2004, we agreed to pay
Delek — The Israel Fuel Corporation Ltd. a fee for the
guaranty in the amount of $150,000 per quarter and that the
payment of this fee would be effective retroactive to
July 1, 2003. During June 2004, Delek – The
Israel Fuel Corporation Ltd. agreed to terminate the fee
agreement effective April 1, 2004, and subsequently, in
September 2004, agreed to forgive the guarantee fees earned for
the period July 1, 2003 through March 31, 2004.
In connection with our April 29, 2005, SunTrust ABL
revolver, Delek Group Ltd. executed a $5 million guaranty
in favor of the lenders. In return, we agreed to pay Delek Group
Ltd. guarantee fees equal to 1.5% per year of the
guaranteed amount. The lenders terminated the guaranty on
October 1, 2005. We are required to pay Delek Group Ltd.
prorated fees of $31,849 on or prior to March 31, 2006 in
satisfaction of our obligations to it under the guaranty.
In connection with our April 26, 2005, $30.0 million
promissory note issued to the Israel Discount Bank of New York
and our April 27, 2005, $20.0 million promissory note
issued to Bank Leumi USA, Delek Group Ltd. guaranteed certain of
our obligations to these lenders. In consideration of the
guaranties, we agreed to pay Delek Group Ltd. quarterly fees
equal to 1.5% per year of the principal amounts of
indebtedness outstanding as of the last business day of each
calendar quarter. We are required to pay the full amount of
guarantee fees payable for the year ended December 31, 2005
(approximately $482,466) on or prior to March 31, 2006. The
guarantee fees are payable quarterly commencing in the second
quarter of 2006.
In June 2005, in connection with our refinery operations, Delek
Group Ltd. guaranteed certain of our obligations to a crude oil
supplier. In return, we agreed to pay Delek Group Ltd. guarantee
fees of $12,500 per month for every calendar month during
the quarter in which we incur debt that is subject to the
guaranty. We are required to pay the full amount of guarantee
fees payable for the year ended December 31, 2005
(approximately $62,466) on or prior to March 31, 2006. The
guarantee fees are payable quarterly commencing in the second
quarter of 2006.
In August 2005, in connection with forward contracts we entered
into with Citibank, N.A., an affiliate of Citigroup Global
Markets Inc., one of the underwriters of this offering, Delek
Group Ltd. guaranteed certain of our obligations up to
$25.0 million to Citibank N.A. In consideration of that
guaranty, we agreed to pay Delek Group Ltd. quarterly fees based
on 1.5% per year of the average quarterly exposure to Delek
Group Ltd. as a result of our forward contract activities. This
guarantee was terminated effective as of January 1, 2006.
We are required to pay the full amount of guarantee fees payable
for the year ended December 31, 2005 (approximately
$14,324) on or prior to March 31, 2006.
Since our inception, Delek – The Israel Corporation
Ltd. has guaranteed certain of our fuel purchasing activities at
no charge to us. At December 31, 2005, our obligations
supported by these guarantees approximated $4.0 million. In
2003 and 2004, Delek – The Israel Fuel Corporation
Ltd. issued letters of credit totaling $9.5 million for our
benefit to support certain of our fuel purchases at no charge to
us. As of December 31, 2005, these letters of credit
remained outstanding.
110
Table of Contents
Loans to President and Chief Executive Officer
On August 20, 2004, we provided Mr. Yemin, our
president and chief executive officer, with an interest-free
loan in the amount of $100,000 in connection with his employment
agreement, which is due in full upon the termination of
Mr. Yemin's employment. On November 14, 2005, in
connection with an amendment of Mr. Yemin's employment
agreement, we provided Mr. Yemin with an additional
interest free loan in the amount of $100,000, which is due in
full upon the termination of Mr. Yemin's employment.
As of December 31, 2005, the full amount of both these
loans were outstanding. See "Management —
Employment Agreement with President and Chief Executive
Officer". These loans were repaid in full to us on
February 7, 2006.
Consulting Agreement with Company Affiliated with Director
As of May 1, 2005, we entered into a consulting agreement
with Greenfeld-Energy Consulting, Ltd., a company owned and
controlled by one of our directors, Zvi Greenfeld. Pursuant to
the consulting agreement we compensated Greenfeld-Energy
Consulting, Ltd. $7,150 per month from May through August
2005 and $7,670 commencing September 2005, plus reasonable
expenses, for consulting services relating to the refining
industry performed personally by Mr. Greenfeld. The
agreement continues in effect until terminated by either party
upon six months advance notice to the other party. In 2005, we
paid $51,610 to Mr. Greenfeld under the consulting
agreement.
Management and Consulting Agreement with Delek Group Ltd.
As of January 1, 2006, we entered into a management and
consulting agreement with Delek Group Ltd., pursuant to which
key management personnel of Delek Group Ltd. provide management
and consulting services to us, including matters relating to
long-term planning, operational issues and financing strategies.
The agreement has an initial term of one year and will continue
thereafter until either party terminates the agreement upon
30 days' advance notice. As compensation, the
agreement provides for payment to Delek Group Ltd. of $125,000
per calendar quarter payable within 90 days of the end of
each quarter and reimbursement for reasonable out-of-pocket
costs and expenses incurred on our behalf.
111
Table of Contents
DESCRIPTION OF CAPITAL STOCK
In connection with this offering, we intend to amend and restate
our certificate of incorporation and bylaws and effect
a
-for-one
stock split of our common stock. The following summary of our
capital stock does not relate to our current certificate or
bylaws, but rather is a description of our capital stock
pursuant to the amended and restated certificate of
incorporation and bylaws that will be in effect upon the
completion of this offering. This information does not purport
to be complete and is subject to, and qualified in its entirety
by reference to, the terms of our amended and restated
certificate of incorporation and amended and restated bylaws,
which will be included as exhibits to the registration statement
of which this prospectus forms a part, and the provisions of
applicable Delaware law, the state in which we are incorporated.
Upon the completion of this offering our authorized capital
stock will consist
of                      shares,
of
which                      shares
will be common stock, $0.01 par value,
and                      shares
will be preferred stock,
$           par
value, the rights and preferences of which may be established
from time to time by our board of directors. Upon completion of
the offering there will
be                      shares
of common stock outstanding and no outstanding shares of
preferred stock.
Common Stock
Holders of common stock are entitled to one vote for each share
held on all matters submitted to a vote of stockholders and do
not have cumulative voting rights in connection with the
election of directors. Accordingly, holders of a majority of the
shares of common stock entitled to vote in any election of
directors may elect all of the directors standing for election.
Subject to any preferential rights of any then outstanding
preferred stock, holders of common stock are entitled to receive
any dividends that may be declared by our board of directors out
of legally available funds. In the event of our liquidation,
dissolution or winding up, holders of common stock will be
entitled to receive proportionately any of our assets remaining
after the payment of liabilities and any preferential rights of
our preferred stock then outstanding.
Holders of common stock have no preemptive, subscription,
redemption or conversion rights. The outstanding shares of
common stock are, and the shares of common stock offered by us
in this offering, when issued, will be, validly issued, fully
paid and non-assessable. The rights, preferences and privileges
of holders of common stock will be subject to those of the
holders of any shares of our preferred stock we may issue in the
future.
Preferred Stock
Our board of directors may, from time to time, authorize the
issuance of one or more classes or series of preferred stock
without stockholder approval. Though, we have no current
intention to issue any shares of preferred stock, our
certificate of incorporation permits us to issue up
to                      shares
of preferred stock. Subject to the provisions of our certificate
of incorporation and limitations prescribed by law, our board of
directors is authorized to adopt resolutions to issue shares,
establish the number of shares, change the number of shares
constituting any series, and provide or change the voting
powers, designations, preferences and relative rights,
qualifications, limitations or restrictions on shares of our
preferred stock, including dividend rights, terms of redemption,
conversion rights and liquidation preferences, in each case
without any action or vote by our stockholders.
The issuance of preferred stock may adversely affect the rights
of our common stockholders by, among other things:
•
restricting dividends on the common stock;
•
diluting the voting power of the common stock;
•
impairing the liquidation rights of the common stock; or
•
delaying or preventing a change in control without further
    action by the stockholders.
112
Table of Contents
As a result of these or other factors, the issuance of preferred
stock could have an adverse impact on the market price of our
common stock.
Anti-takeover Effects of Certain Provisions of Our
Certificate of Incorporation
Our certificate of incorporation contain provisions that could
make it more difficult to acquire control of our company by
means of a tender offer, open market purchases, a proxy contest
or otherwise. A description of these provisions is set forth
below.
Preferred Stock
We believe that the availability of the preferred stock under
our certificate of incorporation provides us with flexibility in
addressing corporate issues that may arise. Having these
authorized shares available for issuance will allow us to issue
shares of preferred stock without the expense and delay of a
special stockholders' meeting. The authorized shares of
preferred stock, as well as shares of common stock, will be
available for issuance without further action by our
stockholders, unless action is required by applicable law or the
rules of any stock exchange on which our securities may be
listed. The board of directors has the power, subject to
applicable law, to issue series of preferred stock that could,
depending on the terms of the series, impede the completion of a
merger, tender offer or other takeover attempt that some, or a
majority, of the stockholders might believe to be in their best
interests or in which stockholders might receive a premium for
their stock over the then prevailing market price of the stock.
Advanced Notice Procedure
Our bylaws provide an advance notice procedure for stockholders
to nominate director candidates for election or to bring
business before an annual meeting of stockholders, including
proposed nominations of persons for election to the board of
directors. Only persons nominated by, or at the direction of,
our board of directors or by a stockholder who has given proper
and timely notice to our secretary prior to the meeting, will be
eligible for election as a director. In addition, any proposed
business other than the nomination of persons for election to
our board of directors must constitute a proper matter for
stockholder action pursuant to the notice of meeting delivered
to us. For notice to be timely, it must be received by our
secretary not less than 60 nor more than 90 calendar days prior
to the first anniversary of the previous year's annual
meeting (or if the date of the annual meeting is advanced more
than 30 calendar days or delayed by more than 30 calendar days
from such anniversary date, not earlier than the
90th calendar day prior to such meeting or the
10th calendar day after public disclosure of the date of
such meeting is first made). These advance notice provisions may
have the effect of precluding the conduct of certain business at
a meeting if the proper procedures are not followed or may
discourage or deter a potential acquirer from conducting a
solicitation of proxies to elect its own slate of directors or
otherwise attempt to obtain control of us.
Special Meetings of Stockholders
Our bylaws provide that special meetings of stockholders may be
called only by our chairman of the board, president or secretary
after written request of a majority of our board of directors.
Anti-Takeover Effects of Delaware Law
Section 203 of the DGCL provides that, subject to
exceptions specified therein, an "interested
stockholder" of a Delaware corporation shall not engage in
any "business combination," including general mergers
or consolidations or acquisitions of additional shares of the
corporation, with the corporation for a three-year period
following the time that such stockholder becomes an interested
stockholder unless:
•
prior to such time, the board of directors of the corporation
    approved either the business combination or the transaction
    which resulted in the stockholder becoming an interested
    stockholder;
113
Table of Contents
•
upon consummation of the transaction which resulted in the
    stockholder becoming an "interested stockholder," the
    interested stockholder owned at least 85% of the voting stock of
    the corporation outstanding at the time the transaction
    commenced (excluding specified shares); or
•
on or subsequent to such time, the business combination is
    approved by the board of directors of the corporation and
    authorized at an annual or special meeting of stockholders, and
    not by written consent, by the affirmative vote of at least
    66
2
/
3
%
    of the outstanding voting stock not owned by the interested
    stockholder.
Under Section 203, the restrictions described above also do
not apply to specified business combinations proposed by an
interested stockholder following the announcement or
notification of one of specified transactions involving the
corporation and a person who had not been an interested
stockholder during the previous three years or who became an
interested stockholder with the approval of a majority of the
corporation's directors, if such transaction is approved or
not opposed by a majority of the directors who were directors
prior to any person becoming an interested stockholder during
the previous three years or were recommended for election or
elected to succeed such directors by a majority of such
directors. The restrictions described above also do not apply to
specified business combinations with a person who is an
"interested stockholder" prior to the time when the
corporation's common stock is listed on a national
securities exchange, so these restrictions would not apply to a
business combination with any person who is a stockholder of
Delek US Holdings, Inc. prior to this offering.
Except as otherwise specified in Section 203, an
"interested stockholder" is defined to include:
•
any person that is the owner of 15% or more of the outstanding
    voting stock of the corporation, or is an affiliate or associate
    of the corporation and was the owner of 15% or more of the
    outstanding voting stock of the corporation at any time within
    three years immediately prior to the date of
    determination; and
•
the affiliates and associates of any such person.
Under some circumstances, Section 203 makes it more
difficult for a person who is an interested stockholder to
effect various business combinations with us for a three-year
period.
Limitation on Liability and Indemnification Matters
Our certificate of incorporation limits the liability of
directors to the fullest extent permitted by Delaware law. The
effect of these provisions is to eliminate the rights of our
company and our stockholders, through stockholders'
derivative suits on behalf of our company, to recover monetary
damages against a director for breach of fiduciary duty as a
director, including breaches resulting from grossly negligent
behavior. However, exculpation does not apply if the directors
acted in bad faith, knowingly or intentionally violated the law,
authorized illegal dividends or redemptions or derived an
improper benefit from their actions as directors. In addition,
our bylaws provide that we will indemnify our directors and
officers to the fullest extent permitted by Delaware law.
We have entered into separate indemnification agreements with
each of our directors and executive officers that may be broader
than the specific indemnification provisions contained in the
DGCL. These indemnification agreements require us, among other
things, to indemnify our directors and officers against
liabilities that may arise by reason of their status or service
as directors or officers.
In addition, we maintain directors' and officers'
liability insurance to provide our directors and officers with
insurance coverage for losses arising from claims based on
breaches of duty, negligence, errors and other wrongful acts.
There is no currently pending material litigation or proceeding
involving any of our directors or officers for which
indemnification is sought.
114
Table of Contents
Listing
We have applied to list our common stock on the NYSE under the
symbol
"               ."
Transfer Agent and Registrar
The transfer agent and registrar for our common stock
is                     .
115
Table of Contents
SHARES ELIGIBLE FOR FUTURE SALE
Prior to this offering, there was no market for our common
stock. We can make no predictions as to the effect, if any, that
sales of shares or the availability of shares for sale will have
on the market price prevailing from time to time. Nevertheless,
sales of significant amounts of our common stock in the public
market, or the perception that those sales may occur, could
adversely affect prevailing market prices and impair our future
ability to raise capital through the sale of our equity at a
time and price we deem appropriate.
Upon completion of this
offering,                      shares
of common stock will be outstanding. The number of shares of
common stock to be outstanding:
•
gives effect to
    a           -for-one
    stock split of our common stock, which will be effective
    immediately prior to this offering;
•
excludes                      shares
    of common stock issuable upon the exercise of outstanding share
    purchase rights, having a weighted average exercise price of
    $           per
    share;
•
excludes                      shares
    of common stock issuable upon the exercise of stock options to
    be granted to certain directors, officers and employees under
    our 2006 long-term incentive plan upon completion of this
    offering;
•
excludes                      shares
    of common stock underlying restricted stock units to be awarded
    to certain directors, officers and employees under our 2006
    long-term incentive plan upon the filing of a registration
    statement on
    Form
S-8
registering the shares of our common stock issuable under our
    2006 long-term incentive plan, which
    Form
S-8
we intend
    to file within 30 days after the completion of this
    offering;
•
excludes                      shares
    of common stock reserved for future grants or awards from time
    to time under our 2006 long-term incentive plan; and
•
assumes no exercise by the underwriters of their option to
    purchase up
    to                     additional
    shares of common stock from us if they sell more
    than                      shares
    in the offering.
Of these
shares,                      shares
(or in the event the underwriters' option to purchase
additional shares is
exercised,                      shares)
of our common stock sold in this offering will be freely
tradable without restriction under the Securities Act of 1933,
as amended, or Securities Act, except for any shares of our
common stock purchased by our "affiliates," as that
term is defined in Rule 144 under the Securities Act, which
would be subject to the limitations and restrictions described
below. The
remaining                      shares
of our common stock outstanding upon completion of this offering
are deemed "restricted shares," as that term is
defined under Rule 144 of the Securities Act.
Restricted securities may be sold in the public market only if
registered or if they qualify for an exemption from registration
under Rule 144 or 144(k) under the Securities Act, which
rules are described below.
Rule 144
In general, under Rule 144 as currently in effect, a
person, or persons whose shares must be aggregated, who has
beneficially owned restricted shares of our common stock for at
least one year is entitled to sell within any three-month period
a number of shares that does not exceed the greater of the
following:
•
one percent of the number of shares of common stock then
    outstanding, which will equal approximately shares immediately
    after this offering, or
•
the average weekly trading volume of our common stock on the New
    York Stock Exchange during the four calendar weeks preceding the
    date of filing of a notice on Form 144 with respect to the
    sale.
Sales under Rule 144 are also generally subject to certain
manner of sale provisions and notice requirements and to the
availability of current public information about us.
116
Table of Contents
Rule 144(k)
Under Rule 144(k), a person, or persons whose shares must
be aggregated, who is not deemed to have been one of our
affiliates at any time during the 90 days preceding a sale
and who has beneficially owned the shares proposed to be sold
for at least two years would be entitled to sell the shares
under Rule 144(k) without complying with the manner of
sale, public information, volume limitations or notice or public
information requirements of Rule 144. Therefore, unless
otherwise restricted, the shares eligible for sale under
Rule 144(k) may be sold immediately upon the completion of
this offering. All of our shares outstanding prior to this
offering are held by an affiliate, and therefore will not be
saleable under Rule 144(k) unless such stockholder ceases
to be an affiliate during the 90 days preceding a sale, and
any such sale could be made only following expiration or waiver
of the
lock-up
agreements referred to below.
Lock-up
Agreements
Our officers and directors, Delek Hungary Holding Ltd. and Delek
Group Ltd. who will collectively hold after this
offering                      shares
of common stock have agreed that they will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or
indirectly, any shares of our common stock or securities
convertible into or exchangeable or exercisable for any shares
of our common stock, enter into a transaction that would have
the same effect, or enter into any swap, hedge or other
arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of our common stock, whether
any of these transactions are to be settled by delivery of our
common stock or other securities, in cash or otherwise, or
publicly disclose the intention to make any offer, sale, pledge
or disposition, or to enter into any transaction, swap, hedge or
other arrangement, without, in each case, the prior written
consent of the representatives of the underwriters for a period
of 180 days after the date of this prospectus.
Registration of Shares in Connection with Delek US Holdings,
Inc. 2006 Long-Term Incentive Plan and Share Purchase Rights
We intend to file a registration statement on
Form
S-8
under the
Securities Act covering shares of common stock to be issued
pursuant to our 2006 long-term incentive plan and share purchase
rights held by our president and chief executive officer. Based
on the number of shares reserved for issuance under the 2006
long-term incentive plan and share purchase rights, the
registration statement would cover
approximately            shares
in total, which
reflects                      shares
reserved under the 2006 long-term incentive plan
and            shares
reserved pursuant to the share purchase rights. The registration
statement will become effective upon filing. Accordingly, shares
of common stock registered under the registration statement on
Form
S-8
will be
available for sale in the open market immediately, after
complying with Rule 144 volume limitations applicable to
affiliates, with applicable
lock-up
agreements, and
with the vesting requirements and restrictions on transfer
affecting any shares that are subject to restricted stock awards.
117
Table of Contents
MATERIAL UNITED STATES FEDERAL INCOME TAX
CONSIDERATIONS TO
NON-U.S.
HOLDERS
General
The following is a summary of the material United States federal
income tax and estate tax considerations related to the
ownership and disposition of our common stock by a
Non-U.S.
Holder
(as defined below). This summary is based on the Internal
Revenue Code of 1986, as amended, which we refer to as the
"Code", existing and proposed Treasury regulations
promulgated under the Code and administrative and judicial
interpretations of the Code, all as of the date of this
prospectus and all of which are subject to change, possibly with
retroactive effect. The Internal Revenue Service is referred to
as "IRS" in this summary.
This summary assumes that
Non-U.S.
Holders
will hold shares of our common stock as capital assets within
the meaning of Section 1221 of the Code. It does not
discuss all of the tax considerations that may be relevant to
Non-U.S.
Holders
of our common stock in light of their particular circumstances
or to
Non-U.S.
Holders
of common stock subject to special rules, such as financial
institutions, regulated investment companies, insurance
companies, pension funds, tax-exempt organizations, partnerships
or other pass-through entities, dealers in securities or
currencies, traders who elect to mark to market their securities
or persons holding the common stock as part of a hedging or
constructive sale transaction, "straddle," conversion
transaction, or other integrated transaction. In addition, this
summary does not discuss any United States tax consequences to a
Non-U.S.
Holder
that is a controlled foreign corporation, passive foreign
investment company, corporation that accumulates earnings to
avoid U.S. federal income tax, or a U.S. expatriate.
This summary does not address all aspects of United States
federal income and estate taxes and does not address any state,
local or
non-United
States tax considerations.
We have not requested a ruling from the IRS on the tax
consequences of owning our common stock. As a result, the IRS
could disagree with portions of this discussion. Persons
considering the purchase of our common stock should consult with
their own tax advisors about the application of the United
States federal income tax laws to their particular situations,
as well as any tax considerations under other United States
federal tax laws, and the laws of any state, local or foreign
jurisdiction.
For purposes of this summary, a
"Non-U.S.
Holder"
is a beneficial owner of common stock that is not, for United
States federal income tax purposes, any of the following:
•
a citizen or individual resident of the United States;
•
a corporation, partnership or other entity treated as a
    corporation or partnership, created in or under the laws of the
    United States or of any political subdivision thereof;
•
an estate the income of which is subject to United States
    federal income taxation regardless of its source; or
•
a trust if a court within the United States is able to exercise
    primary supervision over the administration of the trust and one
    or more U.S. persons have the authority to control all
    substantial decisions of the trust, or a trust that has a valid
    election in effect under applicable United States Treasury
    regulations to be treated as a U.S. person.
If an entity treated as a partnership for U.S. federal
income tax purposes holds shares of common stock, the tax
treatment of a partner will generally depend on the status of
the partner and upon the activity of the partnership. If you are
a partner of a partnership holding shares of common stock, we
suggest you consult your own tax advisor.
Distributions to
Non-U.S.
Holders
Dividends paid to a
Non-U.S.
Holder
that are not effectively connected with the conduct of a
U.S. trade or business of the
Non-U.S.
Holder
generally will be subject to U.S. federal withholding tax
at a 30% rate or, if an income tax treaty applies and certain
certification requirements are satisfied, a lower rate specified
by
118
Table of Contents
the treaty.
Non-U.S.
Holders
should consult their tax advisors regarding their entitlement to
benefits under a relevant tax treaty.
Withholding generally is imposed on the gross amount of a
distribution, regardless of whether we have sufficient earnings
and profits to cause the distribution to be a dividend for
U.S. federal income tax purposes. However, we may elect to
withhold on less than the gross amount of the distribution if we
determine that the distribution is not paid out of our current
or accumulated earnings and profits, based on our reasonable
estimates.
A
Non-U.S.
Holder
may obtain a refund of any excess amounts withheld by filing an
appropriate claim for a refund together with the required
information with the IRS.
Dividends that are effectively connected with a
Non-U.S.
Holder's
conduct of a trade or business within the United States and, if
a tax treaty applies, attributable to a
Non-U.S.
Holder's
U.S. permanent establishment, are exempt from
U.S. federal withholding tax if the
Non-U.S.
Holder
furnishes to us or our paying agent the appropriate IRS form and
other applicable requirements are met. However, dividends exempt
from U.S. federal withholding tax because they are
"effectively connected" or attributable to a
U.S. permanent establishment under an applicable tax treaty
are subject to U.S. federal income tax on a net income
basis at the regular graduated U.S. federal income tax
rates. Any such effectively connected dividends received by a
foreign corporation may, under certain circumstances, be subject
to an additional "branch profits tax" at a 30% rate or
a lower rate specified by an applicable tax treaty.
Gain on Disposition of Common Stock by
Non-U.S.
Holders
A
Non-U.S.
Holder
generally will not be subject to U.S. federal income tax
with respect to gain recognized on a sale or other disposition
of our common stock unless one of the following applies:
•
The gain is effectively connected with a
Non-U.S.
Holder's
    conduct of a trade or business within the United States and, if
    a tax treaty applies, the gain is attributable to a
Non-U.S.
Holder's
    U.S. permanent establishment. In such case, the
Non-U.S.
Holder
    will, unless an applicable tax treaty provides otherwise,
    generally be taxed on its net gain derived from the sale at
    regular graduated U.S. federal income tax rates, and in the
    case of a foreign corporation, may also be subject to the branch
    profits tax described above;
•
A
Non-U.S.
Holder
    who is an individual holds our common stock as a capital asset,
    is present in the United States for 183 or more days in the
    taxable year of the sale or other disposition, and certain other
    conditions are met. In such a case, the
Non-U.S.
Holder
    will be subject to a flat 30% tax on the gain derived from the
    sale, which may be offset by certain U.S. sourced capital
    losses; or
•
We are or have been a "United States real property holding
    corporation", or "USRPHC", for United States
    federal income tax purposes during specified periods.
Because of the real property and retail fuel and convenience
stores we own, we may be, or may become, a USRPHC. The
determination of whether we are a USRPHC is fact specific and
depends on the composition of our assets. Generally, a
corporation is a USRPHC if the fair market value of its
U.S. real property interests, as defined in the Code and
applicable regulations, equals or exceeds 50% of the aggregate
fair market value of its worldwide real property interests and
its other assets used or held for use in a trade or business.
Non-U.S.
Holders
will be subject to U.S. federal income tax with respect to
gain recognized on the sale, exchange or other disposition of
our common stock if we are, or were, a USRPHC at any time during
the shorter of the five-year period ending on the date of the
sale or other disposition and the period a
non-U.S.
holder
held our common stock (the shorter period referred to as the
"lookback period"). However, if we are, have been, or
become, a USRPHC and our common stock is regularly traded on an
established securities market (such as the NYSE), only a
Non-U.S.
Holder
who (actually or constructively) holds or held during the
lookback period more than five percent of our common stock would
be subject to U.S. federal income tax on a disposition of
our common stock.
119
Table of Contents
You are encouraged to consult your own tax advisor regarding our
possible status as a "United States real property holding
corporation" and its possible consequences in your
particular circumstances.
U.S. Federal Estate Tax
Common stock owned or treated as owned by an individual who is
not a citizen or resident of the United States, as specifically
defined for U.S. estate tax purposes, at the time of death
will be included in such holder's gross estate for
U.S. federal estate tax purposes, and may be subject to
U.S. federal estate tax unless an applicable estate tax
treaty provides otherwise.
Information Reporting and Backup Withholding Tax
Generally, we must report annually to the IRS and to each
Non-U.S.
Holder
the amount of dividends paid to, and the tax withheld with
respect to, such
Non-U.S.
Holder.
These reporting requirements apply regardless of whether
withholding was reduced or eliminated by an applicable tax
treaty. Copies of this information also may be made available
under the provisions of a specific tax treaty or agreement with
the tax authorities in the country in which the
Non-U.S.
Holder
resides or is established. In general, backup withholding will
not apply to dividends paid to a
Non-U.S.
Holder if
the holder has provided the required certification that it is a
Non-U.S.
Holder
and neither we nor our paying agents have actual knowledge or
reason to know that the holder is a United States person. The
backup withholding rules generally do not apply to payments to
corporations, whether domestic or foreign.
Under United States Treasury regulations, the payment of
proceeds from the disposition of our common stock by a
Non-U.S.
Holder
made to or through a foreign office of a broker to its customer
generally is not subject to information reporting or backup
withholding. However, if the broker is a U.S. person, a
controlled foreign corporation for U.S. federal income tax
purposes, a foreign person 50% or more of whose gross income
from certain periods is effectively connected with a United
States trade or business, a foreign partnership engaged in a
United States trade or business or a foreign partnership with
significant United States ownership, then information reporting
(but not backup withholding) will be required, unless the broker
has in its records documentary evidence that the beneficial
owner of the payment is not a U.S. person or is otherwise
entitled to an exemption, and other applicable certification
requirements are met (and the broker has no actual knowledge or
reason to know to the contrary). Information reporting and
backup withholding generally will apply to proceeds of a
disposition of our common stock effected at a United States
office of any United States or foreign broker, unless the broker
has in its records documentary evidence that the beneficial
owner of the payment is not a U.S. person or is otherwise
entitled to an exemption, and other applicable certification
requirements are met (and the broker has no actual knowledge or
reason to know to the contrary).
Backup withholding does not represent an additional income tax.
Any amounts withheld from a payment to a
Non-U.S.
Holder
under the backup withholding rules will be allowed as a credit
against the holder's United States federal income tax
liability and may entitle the holder to a refund, provided that
the required information or returns are timely furnished by the
holder to the IRS.
The foregoing discussion of certain U.S. federal income
and estate tax considerations is for general information only
and is not tax advice. Accordingly, each prospective investor
should consult with his own tax adviser regarding
U.S. federal, state, local and
non-U.S.
income
and other tax consequences of the acquisition, holding and
disposing of our common stock.
120
Table of Contents
UNDERWRITING
Lehman Brothers Inc. and Citigroup Global Markets Inc. are
acting as representatives of the underwriters. Under the terms
of an underwriting agreement, which is filed as an exhibit to
the registration statement, each of the underwriters named below
has severally, and not jointly, agreed to purchase from us the
respective number of shares of common stock shown opposite its
name below:
Underwriters
Number of Shares
Lehman Brothers Inc.
Citigroup Global Markets Inc.
Total
The underwriting agreement provides that the underwriters'
obligation to purchase shares of our common stock depends on the
satisfaction of the conditions contained in the underwriting
agreement, including:
•
the obligation to purchase all of the shares of common stock
    offered hereby, if any of the shares are purchased;
•
the representations and warranties made by us to the
    underwriters are true;
•
there is no material change in the financial markets; and
•
we deliver customary closing documents to the underwriters.
Discounts, Commissions and Expenses
The following table summarizes the underwriting discounts and
commissions we will pay to the underwriters. These amounts are
shown assuming both no exercise and full exercise of the
underwriters' option to purchase additional shares of our
common stock. The underwriting fee is the difference between the
initial price to the public and the amount the underwriters pay
to us for the shares.
Without Underwriters'
With Underwriters'
Option
Option
$ Per Share
$
$
$ Total
$
$
The representatives of the underwriters have advised us that the
underwriters propose to offer the shares of our common stock
directly to the public at the initial public offering price on
the cover of this prospectus and to selected dealers, which may
include the underwriters, at such offering price less a selling
concession not in excess of
$           per
share. The underwriters may allow, and the selected dealers may
re-allow, a discount from the concession not in excess of
$           per
share to other dealers. After this offering, the representatives
may change the offering price and other selling terms.
The expenses of the offering that are payable by us are
estimated to be
$                    (excluding
underwriting discounts and commissions).
Option to Purchase Additional Shares
We have granted the underwriters an option exercisable for
30 days after the date of this prospectus to purchase, from
time to time, in whole or in part, up to an aggregate
of                      shares
of our common stock at the initial public offering price on the
cover of this prospectus less underwriting discounts and
commissions. This option may be exercised if the underwriters
sell more
than                      shares
in connection with this offering. To the extent that this option
is exercised, each underwriter will be obligated, subject to
certain conditions, to purchase its pro rata portion of these
additional shares based on the underwriter's percentage
underwriting commitment in this offering as indicated in the
table at the beginning of this Underwriting section.
121
Table of Contents
Lock-Up Agreements
We, Delek Group Ltd., Delek Hungary Holding, Ltd. and all of our
officers and directors have agreed that, without the prior
written consent of the representatives of the underwriters, we
and they will not, subject to some exceptions, and limited
extensions in certain circumstances, directly or indirectly,
offer, pledge, announce the intention to sell, sell, contract to
sell, sell an option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant
to purchase, or otherwise transfer or dispose of any common
stock of the company or any securities which may be converted
into or exchanged for any common stock or enter into any swap or
other agreement that transfers, in whole or in part, any of the
economic consequences of ownership of the common stock for a
period of 180 days from the date of this prospectus other
than permitted transfers.
The
180-day
restricted
period described in the preceding paragraph will be extended if:
•
during the last 17 days of the
180-day
restricted
    period we issue an earnings release or announce material news or
    a material event, or we are notified in writing by the
    representatives of the underwriters that, in their reasonable
    judgment, a material event relating to us has occurred; or
•
prior to the expiration of the
180-day
restricted
    period, we announce that we will release earnings results during
    the
16-day
period
    beginning on the last day of the
180-day
period.
In either case, the restrictions described in the preceding
paragraph will continue to apply until the expiration of the
180-day
period
beginning on the issuance of the earnings release or the
announcement of the material news or material event.
Lehman Brothers Inc. and Citigroup Global Markets Inc., in their
sole discretion, may release the common stock and other
securities subject to the lock-up agreements described above in
whole or in part at any time with or without notice. When
determining whether or not to release common stock and other
securities from lock-up agreements, Lehman Brothers Inc. and
Citigroup Global Markets Inc. will consider, among other
factors, the holder's reasons for requesting the release,
the number of shares of common stock and other securities for
which the release is being requested and market conditions at
the time.
Offering Price Determination
Prior to this offering, there has been no public market for our
common stock. The initial public offering price will be
negotiated between the representatives and us. In determining
the initial public offering price of our common stock, the
representatives will consider:
•
the history and prospects for the industry in which we compete;
•
our financial information;
•
the ability of our management and our business potential and
    earning prospects;
•
the prevailing securities markets at the time of this
    offering; and
•
the recent market prices of, and the demand for, publicly traded
    shares of generally comparable companies.
Indemnification
We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act and
liabilities incurred in connection with the directed share
program described below, and to contribute to payments that the
underwriters may be required to make for these liabilities.
Directed Share Program
At our request, the underwriters have reserved for sale at the
initial public offering price up
to                shares
offered hereby for officers, directors, employees and certain
other persons associated with us. The number of shares available
for sale to the general public will be reduced to the extent
such persons purchase
122
Table of Contents
such reserved shares. Any reserved shares not so purchased will
be offered by the underwriters to the general public on the same
basis as the other shares offered hereby.
Stabilization, Short Positions and Penalty Bids
The representatives may engage in stabilizing transactions,
short sales and purchases to cover positions created by short
sales, and penalty bids or purchases for the purpose of pegging,
fixing or maintaining the price of the common stock, in
accordance with Regulation M under the Exchange Act:
•
Stabilizing transactions permit bids to purchase the underlying
    security so long as the stabilizing bids do not exceed a
    specified maximum.
•
A short position involves a sale by the underwriters of shares
    in excess of the number of shares the underwriters are obligated
    to purchase in the offering, which creates the syndicate short
    position. This short position may be either a covered short
    position or a naked short position. In a covered short position,
    the number of shares involved in the sales made by the
    underwriters in excess of the number of shares they are
    obligated to purchase is not greater than the number of shares
    that they may purchase by exercising their option to purchase
    additional shares. In a naked short position, the number of
    shares involved is greater than the number of shares in their
    option to purchase additional shares. The underwriters may close
    out any short position by either exercising their option to
    purchase additional shares and/or purchasing shares in the open
    market. In determining the source of shares to close out the
    short position, the underwriters will consider, among other
    things, the price of shares available for purchase in the open
    market as compared to the price at which they may purchase
    shares through their option to purchase additional shares. A
    naked short position is more likely to be created if the
    underwriters are concerned that there could be downward pressure
    on the price of the shares in the open market after pricing that
    could adversely affect investors who purchase in the offering.
•
Syndicate covering transactions involve purchases of the common
    stock in the open market after the distribution has been
    completed in order to cover syndicate short positions.
•
Penalty bids permit the representatives to reclaim a selling
    concession from a syndicate member when the common stock
    originally sold by the syndicate member is purchased in a
    stabilizing or syndicate covering transaction to cover syndicate
    short positions.
These stabilizing transactions, syndicate covering transactions
and penalty bids may have the effect of raising or maintaining
the market price of our common stock or preventing or retarding
a decline in the market price of the common stock. As a result,
the price of the common stock may be higher than the price that
might otherwise exist in the open market. These transactions may
be effected on the NYSE or otherwise and, if commenced, may be
discontinued at any time.
Neither we nor any of the underwriters make any representation
or prediction as to the direction or magnitude of any effect
that the transactions described above may have on the price of
the common stock. In addition, neither we nor any of the
underwriters make any representation that the representatives
will engage in these stabilizing transactions or that any
transaction, once commenced, will not be discontinued without
notice.
Electronic Distribution
A prospectus in electronic format may be made available by one
or more of the underwriters and/or selling group members
participating in this offering, or by their affiliates. In those
cases, prospective investors may view offering terms online and,
depending upon the particular underwriter or selling group
member, prospective investors may be allowed to place orders
online. The underwriters may agree with us to allocate a
specific number of shares for sale to online brokerage account
holders. Any such allocation for online distributions will be
made by the representatives on the same basis as other
allocations.
Other than the prospectus in electronic format, the information
on any underwriter's or selling group member's website
and any information contained in any other website maintained by
an underwriter or
123
Table of Contents
selling group member is not part of the prospectus or the
registration statement of which this prospectus forms a part,
has not been approved and/or endorsed by us or any underwriter
or selling group member in its capacity as underwriter or
selling group member and should not be relied upon by investors.
Listing on New York Stock Exchange
We intend to apply to list our common shares on the NYSE under
the symbol
"          ."
Discretionary Sales
The underwriters have informed us that they do not intend to
confirm sales to discretionary accounts that exceed 5% of the
total number of shares offered by them.
Relationships
Certain of the underwriters and their respective affiliates
have, from time to time, performed, and may in the future
perform, various financial advisory and investment banking
services for us or our affiliates, for which they received or
will receive customary fees and expenses. The underwriters and
their respective affiliates may, from time to time, engage in
transactions with or perform services for us in the ordinary
course of their business. Affiliates of Lehman Brothers Inc.
acted as lead arranger and as a lender in connection with the
amended and restated credit facility we entered into as of
April 28, 2005. In the third quarter of 2005, an affiliate
of Citigroup Global Markets Inc. entered into certain forward
contracts with us. These contracts have since expired.
124
Table of Contents
LEGAL MATTERS
The validity of the shares of common stock offered by this
prospectus will be passed upon for us by Fulbright &
Jaworski L.L.P., New York, New York. The underwriters have been
represented by Simpson Thacher & Bartlett LLP, New
York, New York.
CHANGE IN ACCOUNTANTS
Since the audit for the year ended December 31, 2002, we
have engaged Ernst & Young LLP to audit our
consolidated financial statements as of the end of each of our
fiscal years. In connection with this offering, Ernst &
Young LLP informed us that, as the result of certain
relationships between our foreign parent company and Kost Forer
Gabbay & Kasierer, a member firm of the
Ernst & Young global organization, Ernst &
Young LLP concluded that it did not meet the independence
requirements of
Rule
2-01(c)(iii)
of Regulation
S-X
in connection with our fiscal year ended December 31, 2004.
Accordingly, on December 13, 2005 we engaged Mayer Hoffman
McCann P.C. to re-audit our consolidated financial statements
for that period in order to satisfy the requirements of the SEC.
We have engaged Ernst & Young LLP to audit our
consolidated financial statements for the year ending
December 31, 2005 and Ernst & Young LLP has
informed us that they meet applicable independence requirements
of the SEC in respect of our 2002, 2003 and 2005 fiscal years.
The reports of Ernst & Young LLP on our consolidated
financial statements for the years ended December 31, 2002
and 2003 did not contain an adverse opinion or a disclaimer of
opinion and were not qualified or modified as to uncertainty,
audit scope, or accounting principles. In connection with
Ernst & Young LLP's audits of our consolidated
financial statements for the year ended December 31, 2002
and 2003, there were no reportable events and no disagreements
with Ernst & Young LLP on any matters of accounting
principles or practices, financial statement disclosure or
auditing scope and procedures, which, if not resolved to the
satisfaction of Ernst & Young LLP would have caused
Ernst & Young LLP to make reference to the matter in
their report. We have requested Ernst & Young LLP to
furnish a letter addressed to the SEC stating whether it agrees
with the above statements. A copy of that letter confirming its
agreement is filed as an exhibit to the registration statement
of which this prospectus forms a part.
The report of Mayer Hoffman McCann P.C. on our consolidated
financial statements for the year ended December 31, 2004
did not contain an adverse opinion or a disclaimer of opinion
and was not qualified or modified as to uncertainty, audit
scope, or accounting principles. In connection with Mayer
Hoffman McCann P.C.'s audit of our consolidated financial
statement for the year ended December 31, 2004, there were
no reportable events and no disagreements with Mayer Hoffman
McCann P.C. on any matters of accounting principles or
practices, financial statement disclosure or auditing scope and
procedures which, if not resolved to the satisfaction of Mayer
Hoffman McCann P.C. would have caused Mayer Hoffman McCann P.C.
to make reference to the matter in their report. We have
requested Mayer Hoffman McCann P.C. to furnish a letter
addressed to the SEC stating whether it agrees with the above
statements. A copy of that letter confirming its agreement is
filed as an exhibit to the registration statement of which this
prospectus forms a part.
EXPERTS
The consolidated financial statements of Delek US Holdings, Inc.
at December 31, 2003, and for each of the two years then
ended, appearing in this prospectus and related registration
statement have been audited by Ernst & Young LLP,
independent registered public accounting firm, and at
December 31, 2004, and for the year then ended, by Mayer
Hoffman McCann P.C., independent registered public accounting
firm, as set forth in their respective reports thereon appearing
elsewhere in this prospectus, and are included in reliance upon
such reports given on the authority of such firms as experts in
accounting and auditing.
The combined financial statements of the Tyler Refinery and
McMurrey Pipeline (A Business Component of Crown Central
Petroleum Corporation) at December 31, 2004 and 2003 and
for each of the three years in the period ended
December 31, 2004, appearing in this prospectus and related
registration statement, have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report
thereon
125
Table of Contents
appearing elsewhere in this prospectus, and are included in
reliance upon such report given on the authority of such firm as
experts in accounting and auditing.
The consolidated financial statements of Williamson Oil Co.,
Inc. as of and for the year ended November 30, 2003,
appearing in this prospectus and related registration statement,
have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon appearing
elsewhere in this prospectus, and are included in reliance upon
such report given on the authority of such firm as experts in
accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on
Form
S-1
under the
Securities Act to register the shares offered by this
prospectus. The term "registration statement" means
the original registration statement and any and all amendments
thereto, including the schedules and exhibits to the original
registration statement or any amendment. This prospectus is part
of that registration statement. This prospectus does not contain
all of the information set forth in the registration statement
or the exhibits to the registration statement. For further
information with respect to us and the shares we are offering
pursuant to this prospectus, you should refer to the
registration statement and its exhibits. Statements contained in
this prospectus as to the contents of any contract, agreement or
other document referred to are not necessarily complete, and you
should refer to the copy of that contract or other documents
filed as an exhibit to the registration statement. You may read
or obtain a copy of the registration statement at the SEC's
public reference room at 100 F Street, N.E.,
Washington, D.C. 20549. You may obtain information on the
operation of the public reference room and their copy charges by
calling the SEC at
1-800-SEC-0330.
The SEC
maintains a website that contains registration statements,
reports, proxy information statements and other information
regarding registrants that file electronically with the SEC. The
address of the website is http://www.sec.gov.
We are not yet subject to the information and periodic reporting
requirements of the Exchange Act. Upon completion of this
offering, we will become subject to such information and
periodic reporting requirements.
We intend to furnish holders of the shares of common stock
offered in this offering with written annual reports containing
audited consolidated financial statements together with a report
by our independent certified public accountants, and make
available to our stockholders quarterly reports for the first
three quarters of each year containing unaudited interim
financial statements.
126
Table of Contents
GLOSSARY OF SELECTED TERMS
The following are definitions of some of the terms we use to
describe our business and industry in this prospectus.
Alkylation
A refining process for chemically combining isobutane with
    olefin hydrocarbons (e.g., propylene, butylene) through the
    control of temperature and pressure in the presence of an acid
    catalyst, usually sulfuric acid or hydrofluoric acid. The
    product, alkylate, an isoparaffin, has high octane value and is
    blended with motor and aviation gasoline to improve the
    antiknock value of the fuel.
Anode grade coke
Grade of petroleum coke from a delayed coker low in metals such
    as vanadium, nickel and iron that is suitable for making
    graphite anodes for the aluminum smelting industry. If the
    metals content does not qualify as anode grade coke, then the
    coke is generally known as fuel grade. The choice of whether a
    coke may qualify as anode or fuel grade is driven solely by the
    crude slate of the crude unit upstream of the coker and the
    metals contained therein.
Atmospheric column
Refinery unit operated at atmospheric pressure.
Barrel
Common unit of measure in the oil industry which equates to
    42 U.S. gallons.
Blendstocks
Various hydrocarbon streams produced from crude oil, natural gas
    processing, partially refined products and additives, which when
    blended together produce finished gasoline and diesel fuel;
    these may include natural gasoline, FCC unit gasoline, ethanol,
    reformate or butane, among others.
Bpd
Barrels per day, normally calculated as an average figure over a
    longer period of time. In production terms, the number of
    barrels of crude oil produced from a well during a 24 hour
    period; in refining terms, the number of barrels of crude oil
    input or refined petroleum products output by a refinery.
Catalytic cracking
The refining process of breaking down the larger, heavier, and
    more complex hydrocarbon molecules into simpler and lighter
    molecules. Catalytic cracking is accomplished by the use of a
    catalytic agent and is an effective process for increasing the
    yield of gasoline from crude oil. Catalytic cracking processes
    fresh feeds and recycled feeds.
• Fresh Feeds. Crude oil or petroleum distillates that
    are being fed to processing units for the first time.
• Recycled Feeds. Feeds that are continuously fed back
    for additional processing.
Complexity
Gasoline producing refineries are disaggregated according to
    refinery complexity. A "complex" refinery refers to a
    refinery with secondary heavy oil upgrading units downstream of
    atmospheric distillation. These secondary units include
    catalytic crackers, catalytic hydrocrackers and fluid or delayed
    cokers. A "topping" refinery refers to a refinery with
    no secondary heavy oil upgrading units. A "moderate
    complexity refinery" such as the Tyler refinery is
    characterized by its ability to produce a high
127
Table of Contents
percentage of valuable transportation fuels (or conversely, a
    low percentage of products with values lower than the cost of
    crude oil), but without the ability to further refine these
    products into chemicals, petrochemicals, or other specialty
    products.
Crack spread
A simplified benchmark for refining margins that measures the
    difference between the price for light products and crude oil.
    For example, 5-3-2 crack spread is often referenced and
    represents the approximate gross margin resulting from
    processing one barrel of a benchmark crude oil into three fifths
    of a barrel of gasoline, and two fifths of a barrel of high
    sulfur diesel.
Crude oil
A mixture of hydrocarbons that exists in liquid phase in natural
    underground reservoirs and remains liquid at atmospheric
    pressure after passing through surface separating facilities.
Delayed coking
A process by which heavier crude oil fractions can be thermally
    decomposed under conditions of elevated temperatures to produce
    a mixture of lighter oils and petroleum coke. The light oils can
    be processed further in other refinery units to meet product
    specifications. The coke can be used either as a fuel or in
    other applications such as the manufacturing of steel or
    aluminum. Delayed coking is differentiated from fluid coking by
    the alternating services of coke drums for process or drill-out
    purposes.
Distillates
Primarily diesel fuel, kerosene and jet fuel.
FCC (fluidized catalytic cracking)
Catalytic conversion of heavier and more complex hydrocarbons
    into lighter products and coke in a fluidized bed catalytic
    reactor with continuous catalyst regeneration. The light oils
    can be processed further in other refinery units to meet product
    specifications.
Feedstocks
Hydrocarbon compounds, such as crude oil and natural gas
    liquids, that are processed and/or blended into refined
    petroleum products.
Gathering lines
The pipes used to transport oil and gas from a producing field
    to the main transportation pipeline in the area.
Heavy oils
A general term for heavy fuel oils and residual fuel oil.
Henry Hub
The pricing point for natural gas futures contracts traded on
    the New York Mercantile Exchange (NYMEX).
High conversion refinery
Incorporates all the basic building blocks found in both the
    topping and hydroskimming refineries, and it also features gas
    oil conversion units such as catalytic cracking and
    hydrocracking units, olefin conversion units such as alkylation
    or polymerization units, and, frequently, coking units which
    process heavy oils and minimize or eliminate the production of
    residual fuels.
Hydrotreating
The process whereby feedstocks are placed into contact with
    hydrogen, under high pressure and at a high temperature, in the
    presence of a catalyst, to reduce the content of sulfur,
    nitrogen, metals, polyaromatics and olefins.
128
Table of Contents
Independent refiner
A refiner that does not have crude oil exploration or production
    operations. An independent refiner purchases the crude oil used
    as feedstock in its refinery operations from third parties.
Isomerization
A refining process which alters the fundamental arrangement of
    atoms in the molecule without adding or removing anything from
    the original material. Used to convert normal butane into
    isobutane (C4), an alkylation process feedstock, and normal
    pentane and hexane into isopentane (C5) and isohexane (C6),
    high-octane gasoline components.
Jobber
A merchant who buys products (usually in bulk or lots) and then
    sells them to various retailers.
Long ton
2,240 lbs. (approximately 1,000 kg).
Lundberg Survey
An independent market research company offering local and
    national coverage of fuel prices, fuel taxes, station population
    studies, and market shares.
Naphtha
A major constituent fractionated from crude oil during the
    refining process, also referred to as straight run gasoline,
    which is processed further in the naphtha hydrotreating unit,
    reformer unit and isomerization unit to increase octane or
    reduce vapor pressure.
No 2 oil
A petroleum distillate that can be used as either a diesel fuel
    or a fuel oil.
• No. 2 Diesel Fuel. It is used in high speed
    diesel engines that are generally operated under uniform speed
    and load conditions, such as those in railroad locomotives,
    trucks, and automobiles.
• No. 2 Fuel Oil (Heating Oil). It is used in
    atomizing type burners for domestic heating or for moderate
    capacity commercial/industrial burner units.
Platt's
Platt's is an industry recognized source for news, market
    commentary, transaction information and benchmark pricing
    covering global energy, petrochemical and metals markets.
Refined petroleum products
Hydrocarbon compounds, such as gasoline, diesel fuel, jet fuel
    and residual fuel that are produced by a refinery.
Refinery grade propylene
A by-product of FCC, coking and visbreaking, comprised primarily
    of a blend of propylene and propane. The FCC Unit is by far the
    largest source of this material. Propylene is used internally in
    a refinery to manufacture gasoline via alkylation or
    polymerization or, in some cases, as fuel.
Reforming
The thermal or catalytic conversion of petroleum naphtha into
    more volatile products of higher octane number. It represents
    the total effect of numerous simultaneous reactions such as
    cracking, polymerization, dehydrogenation, and isomerization.
Regeneration
In a catalytic process the reactivation of the catalyst,
    sometimes done by burning off the coke deposits under carefully
    controlled conditions of temperature and oxygen content of the
    regeneration gas stream.
Short ton
2,000 lbs. (approximately 907kg).
129
Table of Contents
Slurry oil
Slurry oil is a heavy oil produced in the catalytic cracking
    process. Slurry oil is normally sold as a heavy industrial fuel
    or recycled back into the oil refining process to make other
    refined petroleum products such as diesel.
Sour crude oil
A crude oil that is relatively high in sulfur content, requiring
    additional processing to remove the sulfur.
Sweet crude oil
A crude oil that is relatively low in sulfur content, requiring
    less processing to remove the sulfur.
Throughput
The actual volume per day processed through a unit or a
    refinery, typically expressed in barrels per day.
Throughput capacity
The amount of crude oil that can be processed through a unit or
    a refinery, typically expressed in barrels per day. The design
    capacity per day of a refinery process unit.
Turnaround
A periodically required standard procedure to refurbish and
    maintain a refinery that involves the shutdown and inspection of
    major processing units and occurs every three to five years.
Utilization
Ratio of throughput to the design or throughput capacity of a
    unit or a refinery.
WTI
West Texas Intermediate crude oil, a light, sweet crude oil,
    characterized by an API gravity between 38 and 40 and a sulfur
    content of less than 0.4 weight percent that is used as a
    benchmark for other crude oils.
Yield
The percentage of refined petroleum products that are produced
    from feedstocks.
130
Table of Contents
INDEX TO FINANCIAL STATEMENTS
Page
Delek US Holdings, Inc.
Audited Consolidated Financial Statements
Reports of Independent Registered Public
    Accounting Firms
F-2
Consolidated Balance Sheets as of
    December 31, 2003 and 2004
F-4
Consolidated Statements of Operations for
    the years ended December 31, 2002, 2003 and 2004
F-5
Consolidated Statements of
    Shareholder's Equity for the years ended December 31,
    2002, 2003 and 2004
F-6
Consolidated Statements of Cash Flows for
    the years ended December 31, 2002, 2003 and 2004
F-7
Notes to Consolidated Financial
    Statements
F-8
Condensed Consolidated Financial Statements (Unaudited)
Condensed Consolidated Balance Sheet at
    September 30, 2005 (Unaudited)
F-28
Condensed Consolidated Statements of
    Operations for the nine-months ended September 30, 2005 and
    2004 (Unaudited)
F-29
Condensed Consolidated Statements of Cash
    Flows for the nine-months ended September 30, 2005 and 2004
    (Unaudited)
F-30
Notes to Condensed Consolidated Financial
    Statements (Unaudited)
F-32
Tyler Refinery and McMurrey Pipeline (A Business Component of
    Crown Central Petroleum Corporation)
Audited Combined Financial Statements
Report of Independent Auditors
F-52
Combined Balance Sheets as
    December 31, 2004 and 2003
F-53
Combined Statements of Operations for the
    years ended December 31, 2004, 2003 and 2002
F-54
Combined Statements of Changes in
    Owner's Net Investment for the years ended
    December 31, 2004, 2003 and 2002.
F-55
Combined Statements of Cash Flows for the
    years ended December 31, 2004, 2003 and 2002
F-56
Notes to Combined Financial Statements
F-57
Condensed Combined Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets as of
    March 31, 2005 and December 31, 2004 (Unaudited)
F-71
Condensed Consolidated Statements of
    Operations for the three-months ended March 31, 2005 and
    2004 (Unaudited)
F-72
Condensed Combined Statements of Cash Flows
    for the three-months ended March 31, 2005 and 2004
    (Unaudited)
F-73
Notes to Condensed Combined Financial
    Statements (Unaudited)
F-74
Williamson Oil Co., Inc. and Subsidiaries
Audited Consolidated Financial Statements
Report of Independent Auditors
F-81
Consolidated Balance Sheet as of
    November 30, 2003
F-82
Consolidated Statement of Operations for
    the year ended November 30, 2003
F-83
Consolidated Statement of
    Stockholder's Equity for the year ended November 30,
    2003
F-84
Consolidated Statement of Cash Flows for
    the year ended November 30, 2003
F-85
Notes to Consolidated Financial
    Statements
F-86
F-1
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholder of
Delek US Holdings, Inc.
We have audited the accompanying consolidated balance sheet of
Delek US Holdings, Inc. and Subsidiaries (A Subsidiary of Delek
Group Ltd.) as of December 31, 2003 and the related
consolidated statements of operations, changes in
shareholder's equity and cash flows for each of the two
years in the period then ended. These financial statements are
the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. We were not engaged to perform an
audit of the Company's internal control over financial
reporting. Our audit included consideration of internal control
over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of
the Company's internal control over financial reporting.
Accordingly we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by
management and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Delek US Holdings, Inc. and Subsidiaries
(A Subsidiary of Delek Group Ltd.) at December 31, 2003 and
the consolidated results of their operations and their cash
flows for each of the two years in the period then ended, in
conformity with U.S. generally accepted accounting
principles.
/s/ Ernst & Young LLP
Nashville, Tennessee
March 16, 2004
F-2
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholder of
Delek US Holdings, Inc.
We have audited the accompanying consolidated balance sheet of
Delek US Holdings, Inc. and Subsidiaries (A Subsidiary of Delek
Group Ltd.) as of December 31, 2004, and the related
consolidated statements of operations, changes in
shareholder's equity, and cash flows for the year then
ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit. The
financial statements of Delek US Holdings, Inc. and Subsidiaries
as of December 31, 2003, and for the years ended
December 31, 2003 and 2002, were audited by other auditors
whose report dated March 16, 2004, expressed an unqualified
opinion on those statements.
We conducted our audit in accordance with the standards of the
Public Company Accounting Oversight Board (United States). 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 audit provides a
reasonable basis for our opinion.
In our opinion, the 2004 financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Delek US Holdings, Inc. and Subsidiaries
as of December 31, 2004, and the consolidated results of
their operations and their cash flows for the year then ended,
in conformity with U.S. generally accepted accounting
principles.
/s/ Mayer Hoffman McCann P.C.
Plymouth Meeting, Pennsylvania
January 19, 2006
F-3
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
December 31,
2003
2004
ASSETS
Current assets:
Cash and cash equivalents
$18,907
$22,106
Accounts receivable
6,087
10,210
Inventory
19,199
28,307
Other current assets
2,552
3,471
Total current assets
46,745
64,094
Property and equipment:
Property and equipment
156,129
221,085
Less: accumulated depreciation
(19,591
)
(31,792
)
Property and equipment, net
136,538
189,293
Restricted cash
2,043
3,717
Non-compete agreements, net
749
649
Goodwill
60,627
65,286
Equity investment in related party LLC
6,696
—
Note receivable from a related party
—
100
Other noncurrent assets
3,356
7,034
Total assets
$256,754
$330,173
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
Accounts payable
$11,033
$16,086
Fuel payable
13,570
19,454
Current portion of long-term debt
12,756
19,516
Note payable to related party
3,500
3,500
Current portion of capital lease obligations
—
389
Interest payable
1,312
1,561
Interest payable to related parties
120
1,340
Property and sales taxes payable
2,660
3,468
Petroleum and other product taxes payable
—
1,618
Accrued employee costs
1,072
1,899
Accrued expenses and other current liabilities
2,517
3,454
Total current liabilities
48,540
72,285
Noncurrent liabilities:
Long-term debt, net of current portion
145,800
154,701
Note payable to related party, net of current portion
6,696
25,000
Capital lease obligations, net of current portion
—
227
Accrued lease liability
2,128
3,081
Deferred revenue, net of current portion
465
1,397
Deferred tax liabilities
4,704
17,728
Total noncurrent liabilities
159,793
202,134
Shareholder's equity:
Common stock, $0.01 par value, 3,000 shares
    authorized, 100 shares issued and outstanding
—
—
Additional paid-in capital
41,121
41,121
Retained earnings
7,300
14,633
Total shareholder's equity
48,421
55,754
Total liabilities and shareholder's equity
$256,754
$330,173
See accompanying notes.
F-4
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
Year Ended December 31,
2002
2003
2004
Net sales
$549,632
$600,157
$857,899
Operating costs and expenses:
Cost of goods sold
460,337
500,181
730,780
Store operating expenses
62,050
62,704
80,060
General and administrative expenses
12,227
12,874
15,122
Depreciation and amortization
7,426
8,784
12,374
Gain on disposal of assets
—
(430
)
(898
)
542,040
584,113
837,438
Operating income
7,592
16,044
20,461
Interest expense, net
5,747
5,872
7,059
Interest expense to related parties
—
120
1,210
(Gain) loss on interest rate derivative instruments
2,583
(242
)
727
8,330
5,750
8,996
Income (loss) before income tax expense (benefit)
(738
)
10,294
11,465
Income tax expense (benefit)
(264
)
3,814
4,132
Net income (loss)
$(474
)
$6,480
$7,333
Basic and diluted earnings (loss) per share
$(4,740
)
$64,800
$73,330
Weighted average common shares and equivalents outstanding,
basic and diluted
100
100
100
See accompanying notes.
F-5
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER'S
EQUITY
For the Years Ended December 31, 2002, 2003 and 2004
(In thousands, except share data)
Common Stock
Additional
Total
Paid-In
Retained
Shareholder's
Shares
Amount
Capital
Earnings
Equity
Balance at December 31, 2001
100
$—
$
41,121
$1,294
$
42,415
Net loss
—
—
—
(474
)
(474
)
Balance at December 31, 2002
100
—
41,121
820
41,941
Net income
—
—
—
6,480
6,480
Balance at December 31, 2003
100
—
41,121
7,300
48,421
Net income
—
—
—
7,333
7,333
Balance at December 31, 2004
100
$—
$
41,121
$14,633
$
55,754
See accompanying notes.
F-6
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended December 31,
2002
2003
2004
Cash flows from operating activities:
Net income (loss)
$(474
)
$6,480
$7,333
Adjustments to reconcile net income (loss) to net cash provided
    by operating activities:
Depreciation and amortization
7,535
9,092
13,205
Deferred income taxes
(371
)
3,742
3,943
(Gain) loss on interest rate derivative instruments
2,583
(242
)
727
Gain on disposal of assets
—
(430
)
(898
)
Unrealized loss on fuel derivative instruments
—
20
43
Changes in assets and liabilities, net of acquisitions:
Accounts receivable
(1,042
)
1,254
(1,440
)
Inventory
(675
)
283
(2,164
)
Other current assets
2,129
(127
)
(652
)
Other noncurrent assets
(205
)
213
(869
)
Accounts payable
4,936
4,245
3,807
Interest payable (including to related parties)
1,289
39
1,467
Property and sales taxes payable
121
412
338
Petroleum and other product taxes payable
—
(106
)
(988
)
Accrued employee costs
77
—
40
Accrued expenses and other current liabilities
417
1,010
491
Other noncurrent liabilities
1,208
448
543
Net cash provided by operating activities
17,528
26,333
24,926
Cash flows from investing activities:
Purchase of convenience stores, net of cash acquired
(2,293
)
(12,186
)
(22,150
)
Purchases of property and equipment
(9,773
)
(5,181
)
(6,974
)
Proceeds from sale of convenience store assets
—
1,218
1,781
Net cash used in investing activities
(12,066
)
(16,149
)
(27,343
)
Cash flows from financing activities:
Proceeds from term notes to related parties
—
3,500
25,000
Net payments on short term promissory notes
(161,107
)
—
—
Proceeds from Credit Agreement — Term Loans
158,000
—
—
Payments on Credit Agreement — Term Loans
—
(11,600
)
(11,600
)
Net proceeds from (payments on) Credit Agreement —
    Revolver
3,600
(500
)
(1,000
)
Proceeds from (payments on) Union Planters Term Loan
—
9,000
(9,000
)
Net proceeds from SunTrust Term Loan
—
—
33,700
Net proceeds from SunTrust Revolver
—
—
3,527
Payments on capital lease obligations
—
—
(318
)
Payments on notes payable — Other
—
(57
)
(74
)
Repayment of acquired debt
—
—
(28,563
)
Increase in restricted cash
—
(2,043
)
(1,674
)
Issuance of note receivable from a related party
—
—
(100
)
Purchase of interest rate derivative instruments
(2,700
)
—
(2,289
)
Deferred financing costs paid
(2,258
)
(542
)
(1,993
)
Net cash provided by (used in) financing activities
(4,465
)
(2,242
)
5,616
Net increase in cash and cash equivalents
997
7,942
3,199
Cash and cash equivalents at beginning of year
9,968
10,965
18,907
Cash and cash equivalents at end of year
$10,965
$18,907
$22,106
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest
$4,433
$5,739
$5,969
Income taxes
$—
$—
$190
Assets acquired via the issuance of notes payable
$113
$—
$108
Termination (acquisition) of equity investment in related
    party LLC and related debt
$—
$(6,696
)
$6,696
See accompanying notes.
F-7
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2003 and 2004 and for the Years Ended
December 31, 2002, 2003 and 2004
(In thousands, except share and per share data)
1.
General
Delek US Holdings, Inc., (Delek US or the Company) is the sole
shareholder of MAPCO Express, Inc. (Express), MAPCO Family
Centers, Inc. (Family Centers) and MAPCO Fleet, Inc. (Fleet)
(collectively the Subsidiaries). Delek US and Express were
incorporated during April 2001 in the State of Delaware. Family
Centers and Fleet were incorporated in the State of Delaware
during February 2003 and January 2004, respectively.
Delek US is principally engaged in the operation of 331 retail
convenience stores throughout the southeastern United States
(178 and 93 of which are located in Tennessee and Alabama,
respectively) as of December 31, 2004. The retail
convenience stores, which primarily operate under the
Company's brand names "MAPCO Express",
"Discount Food Mart" and "East Coast" as
well as other non-company proprietary brands, engage in the
retail marketing of gasoline, diesel fuel, other petroleum
products and convenience merchandise.
Delek US is a wholly-owned subsidiary of Delek Group Ltd. (Delek
Group) located in Tel-Aviv, Israel.
2.
Accounting Policies
Principles of Consolidation
The consolidated financial statements relate to Delek US as of
December 31, 2003 and 2004 and for the years ended
December 31, 2002, 2003 and 2004. All significant
intercompany transactions and account balances have been
eliminated in consolidation.
Cash and Cash Equivalents
The Company maintains cash and cash equivalents in accounts with
financial institutions and retains nominal amounts of cash at
the convenience store locations as petty cash. All highly liquid
investments purchased with an original maturity of three months
or less are considered to be cash equivalents.
Accounts Receivable
Accounts receivable primarily represent receivables related to
credit card sales, receivables from vendor promotions and trade
receivables generated in the ordinary course of business. The
Company has recorded an allowance for doubtful accounts related
to wholesale fuel trade receivables as of December 31, 2004
in the amount of $180. All other accounts receivable amounts are
considered to be fully collectible. Accordingly, no additional
allowance has been established as of December 31, 2003 and
2004.
Two credit card providers accounted for approximately 18% and
16% of the total outstanding accounts receivable balance as of
December 31, 2003 and 2004, respectively. Additionally,
rebates from one vendor accounted for approximately 17% and 10%
of the total outstanding accounts receivable balance as of
December 31, 2003 and 2004, respectively.
Inventory
Inventory consists of gasoline, diesel fuel, other petroleum
products, cigarettes, beer, convenience merchandise and food
service merchandise. Fuel inventories are stated at the lower of
cost or market on a
first-in,
first-out
(FIFO) basis. Non-fuel inventories are stated at estimated
cost as determined by the retail inventory method.
F-8
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
Property and Equipment
Assets acquired by the Company in conjunction with acquisitions
are recorded at estimated fair market value in accordance with
the purchase method of accounting as prescribed in Statement of
Financial Accounting Standards (SFAS) No. 141,
Business Combinations.
Other acquisitions of property and
equipment are carried at cost. Betterments, renewals and
extraordinary repairs that extend the life of the asset are
capitalized. Maintenance and repairs are charged to expense as
incurred. The Company owns certain fixed assets on leased
locations and depreciates these assets and asset improvements
over the lesser of management's estimated useful lives of
the asset or the remaining lease term.
Depreciation is computed using the straight-line method over
management's estimated useful lives of the related assets,
which are as follows:
Computer equipment and software
3 years
Automobiles
3 years
Furniture and fixtures
10-15  years
Convenience store equipment
7-15 years
Petroleum and other site (POS) improvements
8-40 years
Building and building improvements
40 years
In accordance with SFAS No. 144,
Accounting for the
Impairment or Disposal of Long-Lived Assets,
the Company
evaluates the realizability of property and equipment as events
occur that could indicate impairment using measurements such as
projected undiscounted operating cash flows from the respective
asset.
Restricted Cash
At December 31, 2003 and 2004, the Company maintained a
restricted cash balance totaling $1,218 and $2,482,
respectively, related to proceeds received from the disposition
of certain assets during 2003 and 2004. In accordance with the
Credit Agreement discussed in note 9, the Company is
required to deposit proceeds received from the disposition of
assets into a cash collateral account until the proceeds can be
used to acquire replacement assets within a period not to exceed
twenty-four months subsequent to the disposition. In the event
replacement assets are not acquired within the twenty-four month
period, the proceeds must be applied to the outstanding
principal balance of the Term Loans.
In addition, the Union Planters Agreement discussed in
note 9 required the Company to maintain $825 of cash and
cash equivalent deposits with the bank at all times that the
principal amount of the borrowings with the bank exceeded a
pre-identified threshold defined in the agreement. The Union
Planters Agreement was terminated as of April 30, 2004 and
was replaced with the SunTrust Agreement discussed in
note 9. The SunTrust Agreement requires the Company to
maintain a deposit of cash and cash equivalents as additional
collateral. The cash collateral requirements are reduced as
SunTrust perfects its security interest in assets owned by the
Company. Amounts classified as restricted under the SunTrust and
Union Planters Agreements at December 31, 2003 and 2004
totaled $825 and $1,235, respectively.
Goodwill
Goodwill is accounted for under the provisions of
SFAS No. 142,
Goodwill and Other Intangible
Assets.
This statement addresses how intangible assets and
goodwill should be accounted for upon and after their
acquisition. Specifically, goodwill and intangible assets with
indefinite useful lives are not amortized but are subject to
annual impairment tests based on their estimated fair value. In
accordance with the provisions of
F-9
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
SFAS No. 142, the Company performs its annual review
of impairment of goodwill in the fourth quarter by comparing the
carrying value of the applicable reporting unit to the fair
value of the reporting unit.
If the fair value is less than the carrying value, then the
Company measures potential impairment by assigning the assets
and liabilities of the Company to the reporting unit in a manner
similar to a purchase transaction, in accordance with the
provisions of SFAS No. 141 and comparing the implied
fair value of goodwill to its carrying value.
Income Taxes
Income taxes are accounted for under the provisions of
SFAS No. 109,
Accounting for Income Taxes.
This
statement generally requires the Company to record deferred
income taxes for the differences between the book and tax bases
of its assets and liabilities, which are measured using enacted
tax rates and laws that will be in effect when the differences
are expected to reverse. Deferred income tax expense or benefit
represents the net change during the year in the Company's
deferred income tax assets and liabilities.
Earnings (Loss) Per Share
Basic earnings (loss) per share (EPS) are computed by
dividing net income by the weighted average common shares
outstanding. As of December 31, 2004, the share purchase
rights granted discussed in note 11 were the only
potentially dilutive instruments. As the exercise of these share
purchase rights is contingent upon the completion of an initial
public offering, they are not considered potentially dilutive
until the initial public offering has been completed.
Stock-Based Compensation
The Company currently accounts for employee stock options under
the intrinsic method in accordance with Accounting Principles
Board Opinion (APB) No. 25,
Accounting for Stock
Issued to Employees,
as permitted by SFAS No. 123,
Share-Based Payment.
SFAS 123 requires the Company
to provide pro forma information regarding income per share as
if compensation cost for share purchase rights granted under the
employment agreement described in Note 11, had been
determined in accordance with the fair value method. Since the
vesting of the share purchase rights is contingent on a future
event that is not currently considered probable, no share
purchase rights have vested and no pro forma compensation cost
is disclosed.
Fair Value of Financial Instruments
The fair values of financial instruments are estimated based
upon current market conditions and quoted market prices for the
same or similar instruments present as of December 31, 2003
and 2004. Management estimates that book value approximates fair
value for all of the Company's assets and liabilities that
fall under the scope of SFAS No. 107,
Disclosures
about Fair Value of Financial Instruments.
A majority of the Company's debt and derivative financial
instruments outstanding at December 31, 2003 and 2004, were
executed with a limited number of financial institutions. The
risk of counterparty default is limited to the unpaid portion of
amounts due to the Company pursuant to the terms of the
derivative agreements. The net amount due from these financial
institutions at December 31, 2003 and 2004 totaled $359 and
$1,921, respectively, as discussed at note 9.
F-10
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
Revenue Recognition
Revenues for products sold are recorded at the point of sale
upon delivery of product, which is the point at which title to
the product is transferred, and when payment has either been
received or collection is reasonably assured.
The Company derives service revenue from the sale of lottery
tickets, money orders, car washes and other ancillary product
and service offerings. Service revenue and related costs are
recorded at gross amounts and net amounts, as appropriate, in
accordance with the provisions of Financial Accounting Standards
Board (FASB) Emerging Issues Task Force (EITF) 99-19,
Reporting Revenue Gross as a Principal Versus Net as an
Agent.
The Company records service revenue and related costs
at gross amounts when the Company is the primary obligor, is
subject to inventory risk, has latitude in establishing prices
and selecting suppliers, influences product or service
specifications, or has several but not all of these indicators.
The Company records service revenues net of costs when the
Company is not the primary obligor and does not possess other
indicators of gross reporting as discussed.
Advertising Costs
The Company expenses advertising costs as incurred.
Advertising expense for the years ended December 31, 2002,
2003 and 2004 totaled $1,569, $1,127 and $1,198, respectively.
Vendor Discounts and Deferred Revenue
The Company receives cash discounts or cash payments from
certain vendors related to product promotions based upon factors
such as quantities purchased, quantities sold, merchandise
exclusivity, store space, etc. In accordance with
EITF
02-16,
Accounting by a Reseller for Consideration Received from a
Vendor
, the Company recognizes these amounts as a reduction
of inventory until the products are sold, at which time the
amounts are reflected as a reduction in cost of goods sold.
Certain of these amounts are received from vendors related to
agreements covering several periods. These amounts are initially
recorded as deferred revenue, are reclassified as a reduction in
inventory upon receipts of the products, and are subsequently
recognized as a reduction of cost of goods sold as the products
are sold.
The Company also receives advance payments from certain vendors
relating to non-inventory agreements. These amounts are recorded
as deferred revenue and are subsequently recognized in revenue
as earned.
Self-Insurance Reserves
The Company is primarily self-insured for employee medical,
workers' compensation and general liability costs, with
varying limits of per claim and aggregate stop loss insurance
coverage that management considers adequate. The Company
maintains an accrual for these costs based on claims filed and
an estimate of claims incurred but not reported. The difference
between actual settlements and recorded accruals are recorded in
the period identified.
Comprehensive Income
Comprehensive income for the years ended December 31, 2002,
2003 and 2004 was equivalent to net income for the Company.
F-11
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
Operating Leases
The Company leases land and buildings under various operating
lease arrangements, most of which provide the Company with the
option, after the initial lease term, to renew the leases. Some
of these lease arrangements include fixed rental rate increases,
while others include rental rate increases based upon such
factors as changes, if any, in defined inflationary indices.
In accordance with SFAS No. 13,
Accounting for
Leases
, for all leases that include fixed rental rate
increases, the Company calculates the total rent expense for the
entire lease period, considering renewals for all periods for
which failure to renew the lease imposes economic penalty, and
records rental expense on a straight-line basis in the
accompanying consolidated statements of operations.
Derivatives
The Company records all derivative financial instruments, such
as interest rate swap agreements, interest rate cap agreements
and fuel related derivatives at estimated fair value regardless
of their intended use in accordance with the provisions of
SFAS No. 133,
Accounting for Derivative Instruments
and Hedging Activities
, as amended and interpreted. Changes
in the fair value of the derivative instruments are recognized
periodically in operations as the Company has elected to not
comply with the hedging requirements of SFAS No. 133
which allow such changes to be classified as other comprehensive
income. The Company obtains the fair value of all derivative
financial instruments on a monthly basis from third party
financial and brokerage institutions.
In January 2003, the Company began entering into multiple fuel
related derivative transactions. As a result of these fuel
related derivative transactions, the Company recorded net
increases to cost of goods sold of $40 and $726 during the years
ended December 31, 2003 and 2004, respectively. Such
amounts include both realized and unrealized gains and losses on
fuel related derivatives.
Use of Estimates
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could
differ from those estimates.
New Accounting Pronouncements
In January 2003, the FASB issued Interpretation No.
(FIN) 46,
Consolidation of Variable Interest Entities,
an Interpretation of Accounting Research
Bulletin No. 51
. In December 2003, the FASB issued
a revision of FIN 46 (FIN 46R), primarily to clarify
the required accounting for investments in variable interest
entities. FIN 46R requires certain variable interest
entities to be consolidated by the primary beneficiary of the
entity if the equity investors in the entity do not have the
characteristics of a controlling financial interest or do not
have sufficient equity at risk for the entity to finance its
activities without additional subordinated financial support
from other parties. FIN 46R was effective in 2004 for all
new variable interest entities created or acquired in 2004. For
variable interest entities created or acquired prior to 2004,
the provisions of FIN 46R must be applied January 1,
2005. The Company has no investments in or contractual
relationships with any variable interest entities. The adoption
of FIN 46R for new variable interest entities did not
impact the consolidated financial statements as of
December 31, 2004 and is not expected to impact the
Company's
F-12
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
future financial position or results of operations related to
the adoption of FIN 46R for variable interest entities
created prior to 2004.
In December 2004, the FASB issued SFAS No. 123R,
Share-Based Payment
, which requires expensing stock
options and other share-based compensation payments to employees
and supersedes SFAS No. 123, which had allowed
companies to choose between expensing stock options or
presenting pro forma disclosure only. SFAS No. 123R
requires all share-based payments to employees, including grants
of employee stock options, to be recognized in the income
statement based on their fair values. Pro forma disclosure is no
longer an alternative. This standard is effective for the
Company as of January 1, 2006 and will apply to all awards
granted, modified, cancelled or repurchased after that date as
well as the unvested portion of prior awards. The Company will
apply SFAS 123R prospectively to new awards and to awards
modified, repurchased or cancelled after January 1, 2006 as
well as the unvested portion of prior awards. The impact of
adoption on the Company's financial position and results of
operations is still being evaluated.
In March of 2005, the FASB issued FIN 47,
Accounting for
Conditional Retirement Obligations
, which requires companies
to recognize a liability for the fair value of a legal
obligation to perform asset-retirement activities that are
conditional on a future event, if the amount can be reasonably
estimated. FIN 47 must be adopted by the Company by the end
of fiscal 2005. The impact of adoption on the Company's
financial position and results of operations is still being
evaluated.
In May 2005, the FASB issued SFAS No. 154,
Accounting Changes and Error Corrections — a
replacement of APB Opinion No. 20 and FASB Statement
No. 3
. This statement changes the requirements for
accounting for and reporting a change in accounting principles
and applies to all voluntary changes in accounting principles.
It also applies to changes required by an accounting
pronouncement in the unusual instance that the pronouncement
does not include specific transition provisions. When a
pronouncement includes specific transition provisions, those
provisions should be followed. This statement requires
retrospective application to prior periods' consolidated
financial statements of changes in accounting principles, unless
it is impracticable to determine either the period-specific
effects or the cumulative effect of change. This statement
becomes effective for fiscal years beginning after
December 15, 2005. The Company does not expect the adoption
of the statement to have an impact on the Company's
financial position and results of operations.
Reclassifications
Certain amounts presented in the prior year consolidated
financial statements have been reclassified to conform with the
current year presentation.
3.
Acquisitions
On February 27, 2003, the Company entered into an asset
purchase agreement with Pilot Travel Centers to acquire certain
assets related to seven convenience stores located in Tennessee.
Total consideration paid for these assets approximated $11,885.
On April 21, 2003, the Company entered into an asset
purchase agreement with
Tri-Cumberland,
Inc. to
acquire certain assets related to a convenience store located in
Tennessee. Total consideration paid for these assets
approximated $90.
On April 30, 2004, the Company completed a stock purchase
agreement with an individual (Seller) whereby the Company
acquired 100% of the issued and outstanding stock of WOC, an
Alabama corporation, which included operating assets, working
capital and related debt for 100 convenience stores located
primarily
F-13
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
in the state of Alabama. Of the 100 stores acquired, eleven are
owned by WOC but leased to and operated by unrelated third
parties. Thus, 89 stores are directly operated by WOC. The
acquisition included two wholly owned subsidiaries of WOC that
provide wholesale distribution of fuel and merchandise to
unrelated third parties and WOC operating stores. Total
consideration paid to the Seller in exchange for 100% of the
stock of WOC was $20,751.
In addition to the consideration paid as acquisition costs
mentioned above, the Company incurred and capitalized
approximately $232 and $2,412 in acquisition transaction costs
during 2003 and 2004, respectively. The allocation of the
aggregate purchase price of the 2003 and 2004 acquisitions is
summarized as follows:
December 31,
2003
2004
Fixed assets
$9,901
$58,830
Inventory
887
6,944
Cash
21
1,013
Other assets
25
2,789
Goodwill
1,391
4,659
Deferred tax liabilities
—
(8,792
)
Assumed liabilities
(18
)
(42,280
)
$12,207
$23,163
The above acquisitions were accounted for using the purchase
method of accounting, as prescribed in SFAS No. 141
and the results of their operations have been included in the
consolidated statements of operations from the dates of
acquisition. The purchase price was allocated to the underlying
assets and liabilities based on their estimated relative fair
values. The final allocation of the 2004 purchase price is
subject to adjustments for a period not to exceed one year from
the consummation date specifically with respect to certain
liabilities accrued. The allocation period is intended to
differentiate between amounts that are determined as a result of
the identification and valuation process required by
SFAS No. 141 for all assets acquired and liabilities
assumed and amounts that are determined because information that
was not previously obtainable becomes obtainable.
The Company consolidated WOC's results of operations
beginning April 30, 2004. The unaudited pro forma
consolidated results of operations for the years ended
December 31, 2003 and 2004 as if the WOC acquisition had
occurred on January 1, of each year, respectively, are as
follows:
(Unaudited)
December 31,
2003
2004
Revenues
$818,582
$976,590
Net income
$6,099
$6,057
Basic and diluted earnings per share
$60,991
$60,567
F-14
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
4.
Inventory
Inventory balances as of December 31, 2003 and 2004 are as
follows:
December 31,
2003
2004
Merchandise
$
12,560
$
19,505
Fuel
6,639
8,802
$
19,199
$
28,307
One merchandise vendor accounted for approximately 57%, 55% and
45% of total merchandise purchases during the years ended
December 31, 2002, 2003 and 2004, respectively. One fuel
vendor accounted for approximately 57%, 56% and 50% of total
fuel purchases during the years ended December 31, 2002,
2003 and 2004, respectively. The Company believes that other
sources of merchandise and fuel inventory are available from
sources other than from its current vendors, however, the cost
structure of such purchases from other vendors may be different.
5.
Property and Equipment
Property and equipment, at cost, consist of the following:
December 31,
2003
2004
Land
$33,087
$43,181
Building and building improvements
61,763
85,913
Petroleum and other site (POS) improvements
44,368
65,627
Furniture and fixtures
307
307
Convenience store equipment
12,857
20,052
Computer equipment and software
3,152
5,117
Automobiles
595
888
156,129
221,085
Less: accumulated depreciation
(19,591
)
(31,792
)
$136,538
$189,293
Depreciation expense for the years ended December 31, 2002,
2003 and 2004 was $7,326, $8,684 and $12,274, respectively.
6.
Non-Compete Agreements
In connection with an acquisition during 2001, the Company
entered into five separate non-compete agreements with key
personnel of the seller totaling $1,000. The individuals may not
compete within a ten-mile radius of the acquired stores for a
period of ten years. The Company amortizes the cost over the
term of
F-15
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
the agreements, or 120 months. Non-compete agreements as of
December 31, 2003 and 2004 consist of the following:
December 31,
2003
2004
Non-compete agreements
$1,000
$1,000
Accumulated amortization
(251
)
(351
)
$749
$649
Amortization expense on non-compete agreements was $100 for the
years ended December 31, 2002, 2003 and 2004. Estimated
amortization expense for each of the next five fiscal years is
$100 per year.
7.
Goodwill
Goodwill represents the excess of the aggregate purchase price
over the fair value of the identifiable net assets acquired. The
Company adopted the provisions of SFAS No. 142
effective January 1, 2002. Under SFAS No. 142,
goodwill acquired in a purchase business combination is no
longer amortized. The Company recorded no goodwill amortization
expense for the years ended December 31, 2002, 2003 and
2004.
The changes in the carrying amounts of goodwill (by reporting
unit) for the years ended December 31, 2003 and 2004 are as
follows:
Balance as of
Acquisitions
Balance as of
December 31,
and
December 31,
2002
Adjustments
2003
Nashville
$39,420
$23
$39,443
Memphis
16,894
—
16,894
Virginia
2,922
—
2,922
Family Centers
—
1,368
1,368
Total
$59,236
$1,391
$60,627
Balance as of
Acquisitions
Balance as of
December 31,
and
December 31,
2003
Adjustments
2004
Nashville
$39,443
$—
$39,443
Memphis
16,894
—
16,894
Virginia
2,922
—
2,922
Family Centers — Nashville
1,368
—
1,368
Family Centers — Alabama
—
4,659
4,659
Total
$60,627
$4,659
$65,286
The provisions of SFAS No. 142 require the Company to
perform an assessment of whether goodwill is impaired annually
unless other impairment indicators exist. Under the provisions
of SFAS No. 142, this test for impairment is based
upon an evaluation of whether the reporting unit's carrying
amount exceeds its fair value. If the reporting unit's
carrying amount exceeds its fair value, the impairment test must
be completed by comparing the implied fair value of the
reporting unit's goodwill to its carrying amount.
F-16
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
The Company completed its annual goodwill impairment review
during 2002, 2003 and 2004. In performing the impairment
reviews, the Company estimated the fair values of the reporting
units using a multiple of expected future cash flows. Based on
the results of these reviews, no impairments were determined to
have occurred, and as a result, no charge was recorded in the
accompanying consolidated statements of operations during 2002,
2003 and 2004.
8.
Equity Investment in Related Party LLC
Between June 20, 2002 and December 31, 2003, the
Company was the nominee of its affiliates Delek-The Israel Fuel
Corporation Ltd. (Delek Fuel) and Delek Motors Ltd. (Delek
Motors), each a subsidiary of Delek Group, with regard to a
two-thirds membership interest in another affiliate,
El-Ad
Delek LLC
(Related Party LLC or the LLC), a Delaware limited liability
company. The two-thirds membership interest in the LLC was
beneficially owned in equal amounts by those affiliates and held
of record by the Company. The LLC is principally engaged in the
ownership and charter operations of a corporate aircraft based
in New Jersey. During this period the Company did not invest any
amounts in this entity, did not exercise control over this
entity and was not entitled to any of the economic benefits or
risks of loss of ownership. On December 31, 2003, the
Company agreed to terminate this nominee arrangement so that
Delek Fuel and Delek Motors would become record, as well as
beneficial, owners of their respective one third
beneficially-owned interests in the LLC held by the Company as
nominee.
Effective December 31, 2003, the Company purchased 33.3% of
the membership interest in the LLC, from Delek Fuel for $6,696.
The Company acquired the interest in the LLC from Delek Fuel by
issuing a variable rate promissory note payable of $6,696 for
which the entire principal balance and interest was due in full
on January 1, 2009. The note bore interest based on LIBOR
plus 1.50% per year.
On May 17, 2004, the Company and Delek Fuel agreed to
terminate this purchase and sale agreement and the related
promissory note payable to Delek Fuel effective
December 31, 2003. In connection with terminating the
agreements effective December 31, 2003, Delek Fuel agreed
to become solely responsible for all income and expense related
to the 33.3% membership interest in the LLC and to cancel the
related note payable as of January 1, 2004. As such, there
are no equity earnings, income or expenses related to the LLC or
interest expense related to the note payable recorded within the
Company's consolidated financial statements for the year
ended December 31, 2004.
F-17
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
9.
Long-Term Obligations
Outstanding borrowings under the Company's existing debt
instruments and capital lease obligations at December 31,
2003 and 2004 are as follows:
December 31,
2003
2004
Notes payable to related parties
$10,196
$28,500
Credit Agreement — Term Loans (A and B)
143,500
131,900
Credit Agreement — Revolver
6,000
5,000
Union Planters Term Loan
9,000
—
SunTrust Term Loan
—
33,700
SunTrust Revolver
—
3,527
Capital lease obligations
—
616
Other notes payable
56
90
168,752
203,333
Less:
Current portion of long-term debt
(12,756
)
(19,516
)
Note payable to related parties — currently due
(3,500
)
(3,500
)
Current portion of capital lease obligation
—
(389
)
$152,496
$179,928
Notes Payable to Related Parties
During February 2003, the Company signed a note payable with
Delek Group in the amount of $3,500. Proceeds from the note were
used in the February 2003 purchase of seven convenience stores
located in Tennessee discussed in note 3. The note bears
interest at a rate of 4.0% per annum with interest and
principal payments due upon maturity. On August 17, 2004,
the Company modified the maturity date of this note payable that
was originally due to mature on August 26, 2004. The note
payable, after the modification, is due to mature on
December 31, 2005.
On December 31, 2003, the Company financed an equity
investment in a related party LLC through the issuance of a
variable rate promissory note with Delek in the amount of
$6,696, which was terminated effective January 1, 2004
discussed in note 8.
On April 28, 2004, the Company signed a note payable with
Delek Fuel in the amount of $25,000. Proceeds from the note were
used to partially fund the WOC purchase discussed in
note 3. The note bears interest at a rate of 6.30% per
annum with interest and principal payments due upon maturity on
April 27, 2008.
Credit Agreement — Term Loans (A and B) and
    Revolver
On July 31, 2002, the Company entered into a Credit
Agreement with Bank of Leumi USA (Leumi) and Bank
Hapoalim BM (Hapoalim). Subsequently, during March of 2004
and again in April of 2004, the Company and the lenders executed
an amended and restated Credit Agreement (the Credit Agreement)
which among other things changed certain covenants of the
original agreement for 2004 and beyond. The Credit
F-18
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
Agreement provided two term loans (Term A and Term B)
to the Company in the original principal amount totaling
$158,000 in aggregate, a portion of the proceeds of which were
used to pay off existing borrowings under two short-term
promissory notes. The term loans in the original and distinct
principal amounts of $116,000 and $42,000 mature on July 1,
2011 (Term A) and July 1, 2007 (Term B),
respectively. The Term A loan is subject to mandatory reductions
in principal over its term and bears interest, payable
quarterly, at the Eurodollar rate plus 1.50% (2.69% and 3.56% at
December 31, 2003 and 2004, respectively). The Term B
loan is payable in full upon maturity and bears interest,
payable quarterly, at the Eurodollar rate plus 1.25% (2.44% and
3.31% at December 31, 2003 and 2004, respectively).
In addition, the Credit Agreement instituted a revolving loan
component (the Revolver) not to exceed $20,000, as amended,
which includes a sub-facility for letters of credit, discussed
in note 11, that at no time may exceed the borrowing
capacity available under the Revolver. The Revolver, is due to
mature on July 31, 2005 and bears interest, payable
quarterly, at a "Base Rate" (as defined in the Credit
Agreement) which was 4.00% and 5.25% at December 31, 2003
and 2004, respectively. Amounts available under the Revolver as
of December 31, 2003 and 2004 totaled $4,000 and $3,450,
respectively.
The Credit Agreement provides for the payment to the lenders of
certain fees. These fees include an agent's fee of $300,
paid on the effective date of the Credit Agreement. Furthermore,
the Company has an obligation to pay the lenders a quarterly fee
of 0.25% of the unused revolving component.
Substantially all of the assets of Express have been pledged as
security for borrowings under the Credit Agreement. In
connection with the Credit Agreement, Delek Group entered into a
Limited Guarantee (Guarantee) for the benefit of the Company and
in favor of Leumi and Hapoalim. The general terms of the
Guarantee require Delek Group to guarantee a significant amount
in the event the Company is unable to perform its payment
obligations under the Credit Agreement. The Guarantee expires on
the earlier of July 1, 2011 or the complete payment
satisfaction of all amounts outstanding under the Credit
Agreement.
The Credit Agreement contains certain provisions that restrict
the Company from paying dividends to its shareholder prior to
July 31, 2005 and only after meeting certain additional
restrictive measures. Additionally, the Credit Agreement
requires the Company to comply with certain financial and
non-financial covenants.
Union Planters Term Loan and Revolver
During February 2003, the Company signed a credit agreement with
Union Planters bank to finance a portion of the February 2003
purchase of seven convenience stores located in Tennessee. This
credit agreement (the Union Planters Agreement) provided for a
term loan (the Union Planters Term Loan) in the amount of $9,000
which was to mature on February 27, 2009. The Union
Planters Term Loan was subject to mandatory reductions in the
principal amount outstanding over its term. Under the Union
Planters Agreement, the Company was restricted from paying
dividends to its shareholder. Furthermore, under the Union
Planters Agreement, the Company was subject to certain financial
covenants that began on June 30, 2003.
Additionally, the Union Planters Agreement instituted a
revolving loan component (the Union Planters Revolver) not to
exceed $500 with a maturity date of August 27, 2005.
In connection with the WOC acquisition discussed in note 3,
the Company terminated the Union Planters Agreement and replaced
it with the SunTrust Agreement discussed below. All outstanding
principal and interest amounts under the Union Planters
Agreement were repaid with the proceeds from the execution of
the SunTrust Agreement.
F-19
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
SunTrust Term Loan and Revolver
On April 30, 2004, the Company entered into a credit
agreement (the SunTrust Agreement) with SunTrust Bank in its
capacity as the administrative agent for a consortium of
lenders. The SunTrust Agreement provided for a term loan (the
SunTrust Term Loan) in an aggregate principal amount equal to
$34,500. The proceeds were used to pay a portion of the purchase
price of the WOC acquisition discussed in note 3 and
refinance a portion of the related debt acquired. The SunTrust
Term Loan matures on June 30, 2008 and requires mandatory
reductions in principal amounts outstanding through its term.
The SunTrust Term Loan bears interest based on a predetermined
pricing grid which allows the Company to select between a
"Base Rate" or "LIBOR" loan (as defined in
the SunTrust Agreement). Interest is payable under the SunTrust
Term Loan on a quarterly basis for Base Rate loans and coincide
with the applicable interest period, not to exceed 90 days,
for LIBOR loans. As of December 31, 2004, the borrowing
rate on the SunTrust Term Loan was 5.20%.
In addition, the SunTrust Agreement provides for a revolving
loan component (the SunTrust Revolver) not to exceed $6,000. The
SunTrust Revolver is due to mature April 30, 2008, unless
the Company opts to reduce the revolving commitment, in part or
in whole, prior to the termination date. In accordance with the
SunTrust Agreement, the Company is required to reduce the amount
available under the SunTrust Revolver by the proceeds received
from the disposition of strategic assets until the proceeds can
be used to acquire replacement strategic assets within a period
not to exceed a 360 day period subsequent to the
disposition. In the event replacement strategic assets are not
acquired within the 360 day period, the proceeds must be
applied to the outstanding principal balance of the SunTrust
Term Loan in inverse order of maturity. During 2004, the Company
received proceeds from the disposition of certain strategic
assets totaling $460 which were used to reduce the amounts
outstanding under the SunTrust Revolver. Amounts available under
the SunTrust Revolver as of December 31, 2004 totaled
$2,013. Interest is payable on borrowings under the SunTrust
Revolver on a quarterly basis, at a "Base Rate" (as
defined in the SunTrust Agreement). As of December 31,
2004, the weighted average borrowing rate on the SunTrust
Revolver was 5.21%.
Substantially all of the assets of Family Centers have been
pledged as security for borrowings under the SunTrust Agreement.
Under the SunTrust Agreement, the Company is restricted from
paying dividends to its shareholder. Additionally, the SunTrust
Agreement requires the Company to be in compliance with certain
financial and non-financial covenants.
Capital Lease Obligations
In connection with the WOC acquisition on April 30, 2004,
discussed in note 3, the Company assumed certain capital
lease obligations for equipment with two financial institutions.
The leases with maturity dates ranging from September 15,
2005 to March 23, 2007 include provisions for interest at
rates ranging from 9.40% to 11.54% and require monthly payments
of principal and interest.
F-20
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
Maturities of Long-Term Obligations
Principal maturities of the Company's existing debt
instruments and capital lease obligations for the next five
years and thereafter are as follows as of December 31, 2004:
2005
2006
2007
2008
2009
Thereafter
Total
Related Party
$3,500
$—
$—
$25,000
$—
$—
$28,500
Term A
12,084
13,536
13,536
13,536
13,536
23,672
89,900
Term B
—
—
42,000
—
—
—
42,000
Revolver
5,000
—
—
—
—
—
5,000
SunTrust Term Loan
2,400
3,600
4,400
23,300
—
—
33,700
SunTrust Revolver
—
—
—
3,527
—
—
3,527
Capital lease obligations
389
213
14
—
—
—
616
Other notes payable
32
54
4
—
—
—
90
Total
$23,405
$17,403
$59,954
$65,363
$13,536
$23,672
$203,333
Derivative Instruments
The Company has entered into multiple interest rate swap
agreements on $19,231 of notional principal amounts and multiple
interest rate cap agreements on $145,000 of notional principal
amounts as of December 31, 2004. These agreements are
intended to economically hedge floating rate debt relating to
the Credit Agreement and the SunTrust Agreement, discussed
above. However, as the Company elected to not comply with the
requirements, including formal hedge designation and
documentation, to apply hedge accounting treatment in accordance
with the provisions of SFAS No. 133, the Company is
recording the fair value of the derivatives in the consolidated
balance sheets with the offsetting entry to earnings. The
derivative instruments mature on various dates ranging from
January 2006 through July 2010. The estimated fair value of the
Company's interest rate swap and interest rate cap
agreements at December 31, 2003 and 2004, respectively,
totaled $359 and $1,921, net, and was recorded in other
noncurrent assets in the accompanying consolidated balance
sheets.
In accordance with SFAS No. 133, as amended, the
Company recorded $2,583, ($242) and $727 of non-cash interest
expense (income) representing the change in estimated fair value
of the interest rate swap and interest rate cap agreements for
the years ended December 31, 2002, 2003 and 2004,
respectively.
10.
Income Taxes
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts
used for income tax purposes.
During the year ended December 31, 2004 the Company
recorded a valuation allowance in the amount of $501 related to
certain state net operating loss carryforwards acquired in
connection with the WOC acquisition discussed in note 3.
This valuation allowance recorded as a part of purchase
accounting resulted in an increase to goodwill.
In assessing the realizability of deferred tax assets,
management considers whether it is more likely than not that
some portion or all of the deferred tax assets will be realized.
The ultimate realization of deferred tax assets is dependent
upon the generation of future taxable income during the periods
in which those
F-21
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
temporary differences become deductible. Management considers
the scheduled reversal of deferred tax liabilities, projected
future taxable income, and tax planning strategies in making
this assessment. Based upon the level of historical taxable
income and projections for future taxable income over the
periods, for which the deferred tax assets are deductible,
management believes it is more likely than not the Company will
realize the benefits of these deductible differences, net of the
existing valuation allowance. The amount of the deferred tax
assets considered realizable, however, could be reduced in the
near term if estimates of future taxable income during the
carryforward period are reduced. Subsequently recognized tax
benefit or expense relating to the valuation allowance for
deferred tax assets, excluding the portion attributable to the
WOC acquisition, will be reported as an income tax benefit or
expense in the consolidated statement of operations. Any
subsequently recognized tax benefit related to the valuation
allowance for deferred tax assets recognized in connection with
the WOC acquisition will be recorded against goodwill.
In connection with the Company's purchase of 100% of the
issued and outstanding stock of WOC discussed in note 3,
the Company recorded goodwill in the amount of $4,659, none of
which is deductible for income tax purposes.
At December 31, 2004, the Company had net federal operating
loss carryforwards of $17,894 which begin expiring in 2018.
State net operating loss carryforwards at December 31, 2004
totaled $29,420 and begin expiring in 2013.
Significant components of the Company's deferred tax assets
and liabilities, included as a component of other current assets
and listed separately in the accompanying consolidated financial
statements, respectively, as of December 31, 2003 and 2004
are as follows:
December 31,
2003
2004
Current Deferred Taxes:
Medical and workers' compensation benefits
$618
$780
Other accrued reserves
160
287
Total current deferred tax assets
778
1,067
Noncurrent Deferred Taxes:
Depreciation/amortization
(12,791
)
(28,791
)
Net operating loss carry forwards
5,888
7,369
Straight-line lease expense
813
1,177
Other
1,386
3,018
Valuation allowance
—
(501
)
Total noncurrent deferred tax liabilities
(4,704
)
(17,728
)
$(3,926
)
$
(16,661
)
F-22
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
The difference between the actual income tax expense (benefit)
and the tax expense (benefit) computed by applying the statutory
federal income tax rate to income (loss) before taxes is
attributable to the following:
Year Ended December 31,
2002
2003
2004
Provision (benefit) for federal income taxes at statutory rate
$
(251
)
$
3,500
$
3,898
State income taxes, net of federal tax provision
(30
)
447
493
Other items
17
(133
)
(259
)
Income tax expense (benefit)
$
(264
)
$
3,814
$
4,132
Income tax expense (benefit) for the years ended
December 31, 2002, 2003 and 2004 is as follows:
Year Ended December 31,
2002
2003
2004
Current
$107
$72
$189
Deferred
(371
)
3,742
3,943
$
(264
)
$
3,814
$
4,132
11.
Commitments and Contingencies
Litigation
The Company is subject to various claims and legal actions that
arise in the ordinary course of business. In the opinion of
management, the ultimate resolution of any such matters known by
management will not have a material adverse effect on the
Company's financial position or results of operations in
future periods.
Self-insurance
The Company is self-insured for employee medical claims up to
$90 per employee per year or an aggregate of approximately
$3,886 per year.
The Company is self-insured for workers' compensation
claims up to $350 on a per claim basis and maintains annual
aggregate stop loss coverage for aggregate claims in excess of
$6,110. Additionally, the Company is self-insured for general
liability claims up to $350 on a per claim basis and maintains
annual stop loss coverage for aggregate claims in excess of
$6,110.
Employment Agreement
The Company maintains an employment agreement with an executive
officer which contains a deferred compensation element. Based on
the agreement, the officer is entitled to one, but not both, of
the issuance of shares pursuant to share purchase rights or a
cash award. The share purchase rights award totals 5% of the
Company's outstanding shares and vests ratably over the
five-year period of the agreement, but is contingent upon the
Company completing an initial public offering during the
five-year period ending April 30, 2009. As the exercise of
these share purchase rights is contingent on the completion of
an initial public offering, in accordance with Accounting
Principles Board No. 25,
Accounting for Stock Issued to
Employees
, compensation expense will only be recognized upon
satisfaction of the contingency. Accordingly, upon completion of
an initial public offering, compensation expense would be
recorded for the vested portion of
F-23
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
the share purchase rights based on the five-year vesting period
and calculated as the difference in the stipulated exercise
price and the fair value of the awards on that date.
As long as the Company does not complete an initial public
offering, the officer is entitled to a cash award which may not
exceed $3,000 over the five year period dependent on the
Company's performance. The Company has accrued
approximately $130 under this agreement during 2004.
Vendor Commitments
The Company maintains an agreement with a significant vendor
that requires the Company to purchase certain general
merchandise exclusively from the vendor over a specified period
of time. Additionally, the Company maintains agreements with
certain fuel suppliers with various terms which generally
require the Company to purchase predetermined quantities of fuel
for a specified period.
Letters of Credit
As of December 31, 2004, the Company has in place six
letters of credit totaling $12,550 with two financial
institutions securing obligations with respect to its
workers' compensation and general liability self-insurance
program and its license to sell certain merchandise. No amounts
were outstanding under these facilities at December 31,
2004.
Operating Leases
The Company leases land, buildings, and equipment for store
locations as well as corporate office space under agreements
expiring at various dates through 2046, after considering
available renewal options. Many of these leases contain renewal
options and require the Company to pay executory costs (such as
property taxes, maintenance, and insurance). Lease expense for
all operating leases for the years ended December 31, 2002,
2003 and 2004 totaled $7,078, $7,836 and $9,730, respectively.
The following is the Company's future estimated lease
payments, including available renewal options for leases the
Company has determined are reasonably assured, under operating
leases having remaining noncancellable terms in excess of one
year as of December 31, 2004:
2005
$9,289
2006
9,255
2007
8,740
2008
8,589
2009
8,497
Thereafter
113,092
Total future minimum rentals
$
157,462
12.
Employee Benefit Plan
Effective October 1, 2001, the Company adopted a defined
contribution benefit plan (the Plan). Participation in the Plan
is available to employees 21 years of age or older and who
have one year of service with a minimum of one thousand hours of
service. The Plan is a Company-sponsored 401(k) plan in which
employees may contribute up to 15% of their eligible
compensation and vest immediately. Under the Plan, the Company
matches employee contributions up to 6% of their eligible
compensation. Employer contributions
F-24
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
vest 50% upon attaining two years of service and vest 100% upon
attaining three years of service. During 2004, the Company
elected an alternative to satisfying certain non-discrimination
requirements as allowed under The Small Business Job Protection
Act of 1996, commonly referred to as the safe harbor provision.
Under the elected provision, employees immediately vest 100% in
all employer contributions for the 2004 Plan year. For the years
ended December 31, 2002, 2003 and 2004, the Company
recorded matching contributions totaling $478, $422 and $426,
respectively.
13.
Related Party Transactions
In August of 2004, the Company executed a promissory note with
an officer in the amount of $100. The promissory note bears no
interest and is payable in full upon termination of the
officer's employment with the Company.
Affiliates of the Company provide guarantees to various vendors
supporting the Company's fuel purchasing activities.
14.
Subsequent Events (unaudited)
Acquisitions
Effective April 29, 2005, the Company acquired certain
refinery and crude oil pipeline assets in Tyler, Texas
(collectively the Refinery) through its newly formed and wholly
owned subsidiary Delek Refining. Total consideration paid for
Refinery assets was $73,132, including capitalized acquisition
transaction costs of $5,048.
As of June 30, 2005, the Company had completed its
allocation of the purchase price for the WOC acquisition
discussed in note 3. The final allocation of the purchase
price for the WOC acquisition resulted in net decreases to
goodwill of $825.
In December 2005, the Company acquired 21 convenience stores and
four undeveloped properties in the Nashville market from BP
Products North America Inc. (BP Acquisition). Total
consideration paid for the BP Acquisition was $35,027.
Long-Term Obligations
During May 2005, the Company repaid all outstanding principal
and interest due under the $3,500 note payable to Delek Group.
On April 26, 2005, the Company entered into a $30,000
promissory note with Israel Discount Bank of New York (Israel
Discount Bank Note). The proceeds of this note were used to fund
a portion of the Refinery acquisition discussed above. The
Israel Discount Bank Note matures on April 30, 2007 and
bears interest, payable quarterly, at a spread of 1.375% over
the 90 day LIBOR, with the first interest payment due on
April 30, 2006.
On April 27, 2005, the Company entered into a $20,000
promissory note with Bank Leumi USA (Bank Leumi Note). The
proceeds of this note were used to fund a portion of the
Refinery acquisition discussed above. The Bank Leumi Note
matures on April 27, 2007 and bears interest, at a spread
of 1.375% over the LIBOR Rate (Reserve Adjusted), with the first
interest payment due in April 2006.
On April 27, 2005, the Company signed a note payable with
Delek Group in the amount of $35,000. Proceeds from the note
were used primarily to fund a portion of the Company's
acquisition of the Refinery
F-25
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
discussed above. The note bears interest at a rate of
7.0% per annum with interest and principal payments due
upon maturity on April 27, 2010.
On April 28, 2005, the Company executed an amended and
restated agreement with a new syndicate of lenders and Lehman
Commercial Paper Inc. serving as administrative agent (the
Senior Secured Credit Facility). In connection with the
execution of the amended and restated agreement, the Company
consolidated the borrowings under its existing Credit Agreement
and SunTrust Agreement into a single credit facility and
increased the borrowing capacity available under the facility to
$205,000.
The Senior Secured Credit Facility consists of a $40,000
Revolving Credit Facility (the Senior Secured Credit Facility
Revolver) and a $165,000 term loan (the Senior Secured Credit
Facility Term Loan). Borrowings under the Senior Secured Credit
Facility are secured by substantially all the assets of the
merged Express and Family Centers entity discussed below. In
December 2005, the Company increased the Senior Secured Credit
Facility Revolver by $30,000 to $70,000, in connection with the
BP Acquisition discussed above.
The Senior Secured Credit Facility Term Loan requires quarterly
principal payments of approximately 0.25% of the principal
balance through March 31, 2011 and a balloon payment of
approximately 94.25% of the principal balance due upon maturity
on April 28, 2011. The Senior Secured Credit Facility
Revolver is payable in full upon maturity on April 28, 2009
with periodic interest repayment requirements. The Senior
Secured Credit Facility Term and Revolver loans bear interest
based on predetermined pricing grids which allow the Company to
choose between a "Base Rate" or "Eurodollar"
loan (as defined in the Senior Secured Credit Facility).
Interest is payable quarterly for Base Rate Loans and the
applicable interest period on Eurodollar Loans.
On May 2, 2005 the Company entered into a $250,000 asset
based senior revolving credit facility with a syndicate of
lenders led by SunTrust Bank as administrative agent to finance
ongoing working capital, capital expenditures and general needs
of the Refinery. This agreement (the SunTrust ABL Revolver)
which matures on April 29, 2009, bears interest based on
predetermined pricing grids which allow the Company to choose
between a "Base Rate" or "Eurodollar" loan
(as defined in the SunTrust ABL Revolver). Interest is payable
quarterly for Base Rate loans and the applicable interest period
on Eurodollar loans. Availability under the SunTrust ABL
Revolver is determined by a borrowing base defined in the
SunTrust ABL Revolver, supported primarily by certain accounts
receivable and inventory.
Additionally, the SunTrust ABL Revolver supports the
Company's issuances of letters of credit in connection with
the purchases of crude for use in the refinery process that at
no time may exceed the aggregate borrowing capacity available
under the SunTrust ABL Revolver.
The SunTrust ABL Revolver contains certain negative covenants
and pledges which prohibit the Company from creating, incurring
or assuming any liens, mortgages, pledges, security interests or
other similar arrangements against the property, plant and
equipment of the Refinery.
In connection with the Company's consolidation of the
borrowings under its existing Credit Agreement and SunTrust
Agreement into a single credit facility, the Senior Secured
Credit Facility, the Company wrote-off deferred financing costs
in the aggregate of $3,466 related to the Credit Agreement and
SunTrust Agreement and incurred and capitalized deferred
financing costs related to the Senior Secured Credit Facility of
$7,802. Additionally, in connection with the execution of the
SunTrust ABL Revolver the Company incurred and capitalized
deferred financing costs of $6,535.
F-26
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
As of December 31, 2003 and 2004 and for the
Years Ended December 31, 2002, 2003 and 2004
In connection with the issuances of the Israel Discount Bank
Note and Bank Leumi Note, Delek Group entered into a limited
guarantee for the benefit of the Company and in favor of Israel
Discount Bank of New York and Bank Leumi USA. The general terms
of the guarantee require Delek Group to guarantee a significant
amount in the event the Company is unable to perform its payment
obligations under the indicated notes. The guarantee expires in
April 2007 or earlier in the event the complete payment
satisfaction of all amounts outstanding under the indicated
notes have been met. In exchange for the guarantee, the Company
has agreed to pay Delek Group an annual fee equal to 1.5% of the
guaranteed amount payable ratably in four equal installments
during the term of the guarantee.
During June 2005, the Company executed an agreement whereby
Family Centers merged with and into Express, leaving Express as
the surviving company of the merged entities. In connection with
Family Centers' legal merger into and with Express, all
amounts owed under the capital lease obligations were repaid and
the leases terminated.
F-27
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands, except share and per share data)
September 30,
December 31,
2005
2004
ASSETS
Current assets:
Cash and cash equivalents
$147,027
$22,106
Accounts receivable
85,473
10,210
Inventory
90,425
28,307
Prepaid inventory
5,081
—
Other current assets
8,528
3,471
Total current assets
336,534
64,094
Property, plant and equipment:
Property, plant and equipment
261,892
221,085
Less: accumulated depreciation
(42,474
)
(31,792
)
Property, plant and equipment, net
219,418
189,293
Restricted cash
—
3,717
Non-compete agreements, net
574
649
Goodwill
63,816
65,286
Note receivable from related party
100
100
Other noncurrent assets
21,116
7,034
Total assets
$641,558
$330,173
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
Accounts payable
$18,375
$16,086
Fuel payable
146,174
19,454
Current portion of long-term debt
1,696
19,516
Note payable to related party
—
3,500
Current portion of capital lease obligations
—
389
Interest payable
1,670
1,561
Interest payable to related parties
2,120
1,340
Property and sales taxes payable
5,023
3,468
Petroleum and other product taxes payable
6,989
1,618
Accrued employee costs
2,920
1,899
Current portion of environmental liabilities
433
—
Forward contract settlement liability
10,923
—
Income taxes payable
21,790
71
Accrued expenses and other current liabilities
9,858
3,383
Total current liabilities
227,971
72,285
Noncurrent liabilities:
Long-term debt
220,982
154,701
Notes payable to related parties
60,000
25,000
Capital lease obligations
—
227
Accrued lease liability
3,568
3,081
Deferred revenue, net of current portion
1,638
1,397
Environmental liabilities, net of current portion
7,499
—
Asset retirement obligations
2,824
—
Deferred tax liabilities
21,802
17,728
Total noncurrent liabilities
318,313
202,134
Shareholder's equity:
Common stock, $0.01 par value, 3,000 shares
    authorized, 100 shares issued and outstanding
—
—
Additional paid-in capital
41,121
41,121
Retained earnings
54,153
14,633
Total shareholder's equity
95,274
55,754
Total liabilities and shareholder's equity
$641,558
$330,173
See accompanying notes.
F-28
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In thousands, except share and per share data)
For the Nine-Month
For the Nine-Month
Period Ended
Period Ended
September 30, 2005
September 30, 2004
Net sales
$1,387,541
$617,971
Operating costs and expenses:
Cost of goods sold
1,179,495
526,294
Operating expenses
92,286
58,289
General and administrative expenses
17,037
10,665
Depreciation and amortization
11,472
8,674
(Gain) on disposal of assets
(1,638
)
(227
)
Losses on forward contract activities
10,923
—
1,309,575
603,695
Operating income
77,966
14,276
Interest expense, net
10,765
5,001
Interest expense to related parties
2,287
778
Write-off of deferred financing costs in connection with
    refinance
3,466
—
(Gain) loss on interest rate derivative instruments
(1,014
)
875
Guarantee fees
313
—
15,817
6,654
Income before income taxes and cumulative effect of change in
    accounting policy
62,149
7,622
Income tax expense
22,362
2,872
Income before cumulative effect of change in accounting policy
39,787
4,750
Cumulative effect of change in accounting policy
267
—
Net income
$39,520
$4,750
Basic and diluted earnings per share:
Income before cumulative effect of change in accounting
    policy
$397,870
$47,500
Cumulative effect of change in accounting policy
(2,670
)
—
Net income
$395,200
$47,500
Basic and diluted weighted average common shares outstanding
100
100
See accompanying notes.
F-29
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
For the Nine-Month
For the Nine-Month
Period Ended
Period Ended
September 30, 2005
September 30, 2004
Operating activities
Net income
$39,520
$4,750
Adjustments to reconcile net income to net cash provided by
    operating activities:
Depreciation and amortization
13,301
9,205
Deferred income taxes
(287
)
2,690
(Gain) loss on interest rate derivative instruments
(1,014
)
875
Gain on disposal of assets
(1,638
)
(227
)
Deferred financing costs written-off in connection with debt
    refinance
3,466
—
Unrealized losses on forward contract activities
10,923
2
Changes in assets and liabilities (excluding those acquired or
    assumed):
Accounts receivable
(74,197
)
(3,297
)
Inventory
(2,239
)
(3,240
)
Prepaid inventory
20,869
—
Other current assets
(449
)
(906
)
Other noncurrent assets
564
(475
)
Accounts payable
93,800
7,264
Interest payable (including to related parties)
889
958
Income taxes payable
21,719
36
Property and sales taxes payable
1,112
320
Petroleum and other product taxes payable
5,371
(1,050
)
Accrued employee costs
877
(1,059
)
Accrued expenses and other current liabilities
5,520
89
Asset retirement obligations
395
—
Other noncurrent liabilities
728
283
Net cash provided by operating activities
139,230
16,218
Investing activities
Escrow payment made with escrow agent
(5,061
)
—
Business combinations, net of cash acquired
(73,132
)
(22,441
)
Purchase price adjustments
(91
)
—
Purchases of property, plant and equipment
(8,415
)
(4,832
)
Proceeds from sale of convenience store assets
3,111
510
Net cash used in investing activities
(83,588
)
(26,763
)
(continued)
F-30
Table of Contents
For the Nine-Month
For the Nine-Month
Period Ended
Period Ended
September 30, 2005
September 30, 2004
Financing activities
Proceeds from issuances of notes payable to related parties
35,000
25,000
Repayment of note payable to related party
(3,500
)
—
Proceeds from issuance of Senior Secured Credit
    Facility — Term Loan
165,000
—
Payments on Senior Secured Credit Facility — Term Loan
(412
)
—
Net proceeds from Senior Secured Credit Facility —
    Revolver
8,000
—
Proceeds from issuance of Israel Discount Bank Note
30,000
—
Proceeds from issuance of Bank Leumi Note
20,000
—
Payments on Credit Agreement — Term A and
    Term B Loans
(131,900
)
(8,700
)
Net (payments on) proceeds from Credit Agreement —
    Revolver
(5,000
)
1,500
Net (payments on) proceeds from Sun Trust Term Loan
(33,700
)
34,100
Net (payments on) proceeds from Sun Trust Revolver
(3,527
)
4,664
Net proceeds from (payments on) notes payable-other
—
(59
)
Payment on Union Planters Term Loan
—
(9,000
)
Repayment of acquired debt
—
(28,563
)
Payments on capital lease obligations
(616
)
(216
)
Decrease (increase) in restricted cash
3,717
(549
)
Purchase of interest rate derivative instruments
—
(2,289
)
Deferred financing costs paid in connection with debt issuances
(13,783
)
(1,926
)
Net cash provided by financing activities
69,279
13,962
Net increase in cash and cash equivalents
124,921
3,417
Cash and cash equivalents at beginning of period
22,106
18,907
Cash and cash equivalents at end of period
$147,027
$22,324
Supplemental disclosures of cash flow information
Cash paid during the period for:
Interest
$10,502
$4,321
Income taxes
$750
$146
Assets acquired via the issuance of notes payable
$40
$108
Termination of equity investment in related party LLC and
    related debt
$—
$6,696
See accompanying notes.
F-31
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(In thousands, except share and per share data)
September 30, 2005
1.
General
Delek US Holdings, Inc. and Subsidiaries (Delek US or
the Company) is the sole shareholder of MAPCO Express, Inc.
(Express), MAPCO Fleet, Inc. (Fleet), Delek Refining Inc. (Delek
Refining), and Delek Finance, Inc. (Delek Finance) (collectively
the Subsidiaries). Delek US and Express were incorporated
during April 2001 in the State of Delaware. Fleet, Delek
Refining and Delek Finance were incorporated in the State of
Delaware during January 2004, February 2005 and April 2005,
respectively. Previously, the Company's subsidiaries
included separately MAPCO Family Centers, Inc. (Family Centers).
During June 2005, the Company executed an agreement whereby
Family Centers merged with and into Express, leaving Express as
the surviving company of the merged entities.
The Company is a wholly-owned subsidiary of Delek Group Ltd.
(Delek Group) located in Tel-Aviv, Israel.
The Company consists of two reportable segments —
Refining and Retail discussed in note 5.
2.
Accounting Policies
Basis of Presentation
The condensed consolidated financial statements include the
accounts of the Company and have been prepared by the Company,
without audit. Certain information and footnote disclosures
normally included in annual financial statements prepared in
accordance with accounting principles generally accepted in the
United States have been condensed or omitted, although the
Company believes that the disclosures are adequate to make the
financial information presented not misleading. It is suggested
that these condensed consolidated financial statements be read
in conjunction with the audited financial statements and the
notes thereto for the year ended December 31, 2004. In the
opinion of management, all adjustments necessary for a fair
statement of the results of operations for the interim period
have been included. All adjustments are of a normal, recurring
nature.
Principles of Consolidation
The condensed consolidated financial statements relate to Delek
US as of September 30, 2005 and December 31, 2004, and
for the nine-month periods ended September 30, 2005 and
2004. All significant intercompany transactions and account
balances have been eliminated in consolidation.
Reclassifications
Certain amounts presented in prior period financial statements
have been reclassified to conform with the current period
presentation.
Cash and Cash Equivalents
The Company considers cash on hand and deposits in banks to be
cash. All highly liquid investments purchased with an original
maturity of three months or less are considered to be cash
equivalents.
Restricted Cash
At December 31, 2004, the Company maintained a restricted
cash balance totaling $2,482 related to proceeds received from
the disposition of certain assets during 2004 and 2003. In
accordance with the Credit Agreement discussed in note 7,
the Company was required to deposit proceeds received from the
disposition
F-32
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
of assets into a cash collateral account until the proceeds
could be used to acquire replacement assets within a period not
to exceed twenty-four months subsequent to the disposition. In
the event replacement assets were not acquired within the
twenty-four month period, the proceeds would be applied to the
outstanding principal balance of the Term Loans.
In addition, the SunTrust Agreement discussed in note 7
required the Company to maintain a deposit of cash and cash
equivalents as additional collateral. The cash collateral
requirements would be reduced as SunTrust perfected its security
interest in assets owned by the Company. Amounts classified as
restricted under the SunTrust Agreement at December 31,
2004 totaled $1,235.
In connection with the execution of the Senior Secured Credit
Facility discussed in note 7, the Company utilized its
existing restricted cash balances to reduce the outstanding
principal balances of the Credit Agreement and SunTrust
Agreement prior to amendment. Accordingly, at September 30,
2005, the Company did not maintain a restricted cash balance.
Accounts Receivable
Accounts receivable primarily represent receivables related to
credit card sales, receivables from vendor promotions and trade
receivables generated in the ordinary course of business. The
Company has recorded an allowance for doubtful accounts related
to trade receivables of $180 as of September 30, 2005 and
December 31, 2004. All other accounts receivable amounts
are considered to be fully collectible, and accordingly, no
additional allowance has been established as of
September 30, 2005 and December 31, 2004.
Inventory
Refinery inventory consists of crude oil, refined products and
blendstocks which are stated at the lower of cost or market.
Cost is determined under the
last-in,
first-out
(LIFO) valuation method. The LIFO method requires
management to make estimates on an interim basis of the
anticipated on-hand year-end inventory quantities which could
differ from actual quantities. Cost of crude oil, refined
product and blendstock inventories in excess of market value are
charged to cost of goods sold. Such changes are subject to
reversal in subsequent periods, not to exceed LIFO cost, if
prices recover.
Retail merchandise inventory consists of gasoline, diesel fuel,
other petroleum products, cigarettes, beer, convenience
merchandise and food service merchandise. Fuel inventories are
stated at the lower of cost or market on a
first-in,
first-out
(FIFO) basis. Non-fuel inventories are stated at estimated
cost as determined by the retail inventory method.
Prepaid Inventory
One of the Company's vendors requires advance payments for
the purchase of crude oil. Upon delivery, the Company records
the receipts of the crude oil as an increase to inventory. The
initial prepayment, prior to receipt of the crude oil, is
recorded as prepaid inventory.
Property, Plant, and Equipment
Assets acquired by the Company in conjunction with acquisitions
are recorded at estimated fair market value in accordance with
the purchase method of accounting as prescribed in Statement of
Financial Accounting Standards (SFAS) No. 141,
Business Combinations.
Other acquisitions of property,
plant and equipment are carried at cost. Betterments, renewals
and extraordinary repairs that extend the life of the asset
F-33
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
are capitalized. Maintenance and repairs are charged to expense
as incurred. The Company owns certain fixed assets on leased
locations and depreciates these assets and asset improvements
over the lesser of management's estimated useful lives of
the asset or the remaining lease term. Depreciation is computed
using the straight-line method over management's estimated
useful lives of the related assets, which are as follows:
Computer equipment and software
3 years
Automobiles
3 years
Furniture and fixtures
5-15 years
Refinery machinery and equipment
15-20  years
Convenience store equipment
7-15 years
Petroleum and other site (POS) improvements
8-40 years
Building and building improvements
40 years
In accordance with SFAS No. 144,
Accounting for the
Impairment or Disposal of Long-Lived Assets
, the Company
evaluates the realizability of property, plant and equipment as
events occur that could indicate impairment using measurements
such as projected undiscounted operating cash flows from the
respective asset.
Refinery Turnaround Costs
Refinery turnaround costs are incurred in connection with the
Company's planned shutdown and inspection of the
Refinery's major units to perform necessary repairs and
replacements. Refinery turnaround costs are deferred when
incurred and amortized on a straight-line basis over that period
of time estimated to lapse until the next planned turnaround
occurs. Refinery turnaround costs include, among other things,
the cost to repair, restore, refurbish or replace refinery
equipment such as vessels, tanks, reactors, piping, rotating
equipment, instrumentation, electrical equipment, heat
exchangers and fired heaters.
Goodwill
Goodwill is accounted for under the provisions of
SFAS No. 142,
Goodwill and Other Intangible
Assets.
This statement addresses how intangible assets and
goodwill should be accounted for upon and after their
acquisition. Specifically, goodwill and intangible assets with
indefinite useful lives are not amortized but are subject to
annual impairment tests based on their estimated fair value. In
accordance with the provisions of SFAS No. 142, the
Company performs its annual review of impairment of goodwill in
the fourth quarter by comparing the carrying value of the
applicable reporting unit to the fair value of the reporting
unit.
If the fair value is less than the carrying value, then the
Company measures potential impairment by assigning the assets
and liabilities of the Company to the reporting unit in a manner
similar to a purchase transaction, in accordance with the
provisions of SFAS No. 141 and comparing the implied
fair value of goodwill to its carrying value.
Income Taxes
Income taxes are accounted for under the provisions of
SFAS No. 109,
Accounting for Income Taxes.
This
statement generally requires the Company to record deferred
income taxes for the differences between the book and tax bases
of its assets and liabilities, which are measured using enacted
tax rates and laws that
F-34
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
will be in effect when the differences are expected to reverse.
Deferred income tax expense represents the net change during the
period in the Company's deferred income tax assets and
liabilities.
In connection with the Company's acquisition of the
Refinery effective April 29, 2005 discussed in note 3,
the Company's consolidated effective tax rate changed.
Substantially all of the Company's Refinery operations are
organized as a limited partnership in the state of Texas, which
is not subject to income tax in the state of Texas. As a result,
the Refinery operation's effective tax rate for the year is
equal to the federal rate plus a nominal amount of state income
taxes. Consequently, the Company's consolidated effective
tax rate is reduced by Delek Refining's proportionate
contribution to the Company's consolidated pretax earnings.
The taxation of the Company's earnings in Texas is subject
to change if new legislation is enacted that would require
taxation of all or a portion of a limited partnership's
earnings.
During the nine-month period ended September 30, 2005, as a
result of an increase in income before income taxes, the
Company's statutory federal rate increased from
approximately 34% to 35%. The Company made adjustments to
certain of its deferred tax assets and liabilities to reflect
this increase. As a result, during the nine-month period ended
September 30, 2005, the Company recorded additional income
tax expense of approximately $600.
Earnings Per Share
Basic and diluted earnings per share are computed by dividing
net income by the weighted average common shares outstanding.
For the periods ending September 30, 2005 and 2004, the
share purchase rights granted as discussed in note 10 were
the only potentially dilutive instruments. As the exercise of
these share purchase rights is contingent upon the completion of
an initial public offering, they are not considered potentially
dilutive until the initial public offering has been completed.
Stock-Based Compensation
The Company currently accounts for employee stock options under
the intrinsic method in accordance with Accounting Principles
Board Opinion (APB) No. 25,
Accounting for Stock
Issued to Employees
, as permitted by SFAS No. 123,
Share-Based Payment
. SFAS 123 requires the Company
to provide pro forma information regarding income per share as
if compensation cost for share purchase rights granted under the
employment agreement described in Note 10, had been
determined in accordance with the fair value method. Since the
vesting of the share purchase rights is contingent on a future
event that is not currently considered probable, no share
purchase rights have vested and no pro forma compensation cost
is disclosed.
Fair Value of Financial Instruments
The fair values of financial instruments are estimated based
upon current market conditions and quoted market prices for the
same or similar instruments as of September 30, 2005, and
December 31, 2004. Management estimates that book value
approximates fair value for all of the Company's assets and
liabilities that fall under the scope of SFAS No. 107,
Disclosures about Fair Value of Financial Instruments.
A majority of the Company's debt and derivative financial
instruments outstanding at September 30, 2005, and
December 31, 2004, were executed with a limited number of
financial institutions. The risk of counterparty default is
limited to the unpaid portion of amounts due to the Company
pursuant to the terms of the derivative agreements. The net
amount due from these financial institutions at
September 30, 2005, and December 31, 2004, totaled
$2,935 and $1,921, respectively, as discussed in note 7.
F-35
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
Revenue Recognition
Revenues for products sold are recorded upon delivery of
product, which is the point at which title to the product is
transferred, and when payment has either been received or
collection is reasonably assured.
The Company derives service revenue from the sale of lottery
tickets, money orders, and other ancillary product and service
offerings. Service revenue and related costs are recorded at
gross amounts and net amounts, as appropriate, in accordance
with the provisions of Financial Accounting Standards Board
(FASB) Emerging Issues Task Force
(EITF)
99-19,
Reporting Revenue Gross as a Principal Versus Net as an
Agent
. The Company records service revenue and related costs
at gross amounts when the Company is the primary obligor, is
subject to inventory risk, has latitude in establishing prices
and selecting suppliers, influences product or service
specifications, or has several but not all of these indicators.
The Company records service revenues net of costs when the
Company is not the primary obligor and does not possess other
indicators of gross reporting as discussed.
Advertising Costs
The Company expenses advertising costs as incurred. Advertising
expense for the nine-month periods ended September 30, 2005
and 2004 totaled approximately $800 for each period.
Vendor Discounts and Deferred Revenue
The Company receives cash discounts or cash payments from
certain vendors related to product promotions based upon factors
such as quantities purchased, quantities sold, merchandise
exclusivity, store space and various other factors. In
accordance with Emerging Issues Task Force
(EITF)
02-16,
Accounting by a Reseller for Consideration Received from a
Vendor
, the Company recognizes these amounts as a reduction
of inventory until the products are sold, at which time the
amounts are reflected as a reduction in cost of goods sold.
Certain of these amounts are received from vendors related to
agreements covering several periods. These amounts are initially
recorded as deferred revenue, are reclassified as a reduction in
inventory upon receipts of the products, and are subsequently
recognized as a reduction of cost of goods sold as the products
are sold.
The Company also receives advance payments from certain vendors
related to contractual agreements. These amounts are recorded as
deferred revenue and are subsequently recognized in revenue as
earned in accordance with the terms of the agreements.
Self-Insurance Reserves
The Company is primarily self-insured for employee medical,
workers' compensation, and general liability costs, with
varying limits of per claim and aggregate stop loss insurance
coverage that management considers adequate. The Company
maintains an accrual for these costs based on claims filed and
an estimate of claims incurred but not reported. The difference
between actual settlements and recorded accruals are recorded in
the period identified.
Environmental Expenditures
It is the Company's policy to accrue environmental and
clean-up
related costs
of a non-capital nature when it is both probable that a
liability has been incurred and the amount can be reasonably
estimated. Environmental liabilities represent the current
estimated costs to investigate and remediate contamination at
F-36
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
the Company's properties. This estimate is based on
internal and third-party assessments of the extent of the
contaminations, the selected remediation technology and review
of applicable environmental regulations. Accruals for estimated
costs from environmental remediation obligations generally are
recognized no later than completion of the remedial feasibility
study and include, but are not limited to, costs to perform
remedial actions and costs of machinery and equipment that is
dedicated to the remedial actions and that does not have an
alternative use. Such accruals are adjusted as further
information develops or circumstances change. Expenditures for
equipment necessary for environmental issues relating to ongoing
operations are capitalized.
Adoption of FIN 47
Effective January 1, 2005, the Company adopted
Interpretation No. 47,
Accounting for Conditional Asset
Retirement Obligations
(FIN 47), which requires
companies to recognize a liability for the fair value of a legal
obligation to perform asset-retirement activities that are
conditional on a future event when the amount can be reasonably
estimated. FIN 47 also clarifies when an entity would have
sufficient information to reasonably estimate the fair value of
an asset retirement obligation under Statement of Financial
Accounting Standards No. 143,
Accounting for Asset
Retirement Obligations
(SFAS 143).
Associated with the adoption of the standard the Company
recorded a cumulative effect of adoption of $267 (net of $180 of
income taxes) ($2,670 per share) and a long-term asset
retirement obligation of $1,539. The effect on the results of
operations for the nine months ended September 30, 2005 and
the pro forma effects on the results of operations for the nine
months ended September 30, 2004 are $125 and $71,
respectively.
The Company's initial asset retirement obligation as of
January 1, 2005 relates to the removal of underground
storage tanks at the Company's leased retail sites as
legally required under the applicable leases. The asset
retirement obligation for storage tank removal on leased retail
sites is being accreted over the expected life of the
underground storage tanks which approximates the average retail
site lease term.
Subsequent to adoption of FIN 47, the Company recorded a
long-term asset retirement obligation on April 29, 2005 in
connection with its purchase of the Refinery of $1,255 related
to the required disposal of waste in certain storage tanks. In
addition to this identified asset retirement obligation at the
Refinery, the Company is continuing to evaluate the need for
additional asset retirement obligations related to the Refinery
as discussed in Note 3.
In order to determine fair value, management must make certain
estimates and assumptions including, among other things,
projected cash flows, a credit-adjusted risk-free rate and an
assessment of market conditions that could significantly impact
the estimated fair value of the asset retirement obligation.
Comprehensive Income
Comprehensive income for the nine-month periods ended
September 30, 2005 and 2004 was equivalent to net income
for the Company.
Operating Leases
The Company leases land and buildings under various operating
lease arrangements, most of which provide the Company with the
option, after the initial lease term, to renew the leases. Some
of these lease
F-37
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
arrangements include fixed rental rate increases, while others
include rental rate increases based upon such factors as
changes, if any, in defined inflationary indices.
In accordance with SFAS No. 13,
Accounting for
Leases
, for all leases that include fixed rental rate
increases, the Company calculates the total rent expense for the
entire lease period, considering renewals for all periods for
which failure to renew the lease imposes economic penalty, and
records rental expense on a straight-line basis in the
accompanying condensed consolidated statements of operations.
Derivatives
The Company records all current derivative financial
instruments, such as interest rate swap agreements, interest
rate cap agreements, fuel related derivatives and forward
contracts at estimated fair value regardless of their intended
use in accordance with the provisions of SFAS No. 133,
Accounting for Derivative Instruments and Hedging
Activities
, as amended and interpreted. Changes in the fair
value of the derivative instruments have historically been
recognized periodically in operations as such instruments did
not comply with the hedging requirements of
SFAS No. 133 which allow such changes to be classified
as other comprehensive income. The Company obtains the fair
value of all derivative financial instruments on a monthly basis
from third party financial and brokerage institutions.
Changes in the fair value of certain fuel related derivatives
are recorded as an adjustment to cost of goods sold. The Company
recorded net increases to cost of goods sold as a result of
these fuel related derivative transactions of $264 and $413,
respectively, during the nine-month periods ended
September 30, 2005 and 2004. Such amounts include both
realized and unrealized gains and losses. The Company obtains
the fair value of these fuel related derivative instruments on a
monthly basis from third party brokerage institutions.
During August and September of 2005, the Company entered into
six forward fuel contracts with a major financial institution.
The contracts, which fix the purchase price of crude and sales
price of finished grade fuel for a predetermined number of units
at a future date, have fulfillment terms of less than
60 days. The Company recorded unrealized losses of $10,923
during the nine-month period ended September 30, 2005 which
are included as losses on forward contract hedging activities as
well as forward contract settlement liability in the
accompanying condensed consolidated statements of operations and
condensed consolidated balance sheets, respectively. The Company
obtains information to calculate the fair value of these forward
contracts on a daily basis from a third party financial
institution.
Use of Estimates
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could
differ from those estimates.
New Accounting Pronouncements
In December 2004, the FASB issued SFAS No. 123R,
Share-Based Payment
, which requires expensing stock
options and other share-based compensation payments to employees
and supersedes SFAS No. 123, which had allowed
companies to choose between expensing stock options or showing
pro forma disclosure
F-38
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
only. SFAS No. 123R requires all share-based payments
to employees, including grants of employee stock options, to be
recognized in the income statement based on their fair values.
Pro forma disclosure is no longer an alternative. This standard
is effective for the Company as of January 1, 2006 and will
apply to all awards granted, modified, cancelled or repurchased
after that date as well as the unvested portion of prior awards.
The Company will apply SFAS 123R prospectively to new
awards and to awards modified, repurchased or cancelled after
January 1, 2006 as well as the unvested portion of prior
awards. The impact of adoption on the Company's financial
position and results of operations is still being evaluated.
In November 2004, the FASB issued Statement No. 151,
Inventory Costs
, which clarifies the accounting for
abnormal amounts of idle facility expense, freight, handling
costs, and wasted material and requires that those items be
recognized as current-period charges. Statement No. 151
also requires that allocation of fixed production overhead to
the costs of conversion be based on the normal capacity of the
production facilities. Statement No. 151 is effective for
fiscal years beginning after June 15, 2005, and its impact
on the Company's financial position and results of
operations has not been determined.
In December 2004, the FASB issued SFAS No. 153,
Exchanges of Nonmonetary Assets
, which addresses the
measurement of exchanges of nonmonetary assets.
SFAS No. 153 eliminates the exception from fair value
measurement for nonmonetary exchanges of similar productive
assets, which was previously provided by Accounting Principles
Board (APB) Opinion No. 29,
Accounting for
Nonmonetary Transactions
, and replaces it with an exception
for exchanges that do not have commercial substance.
SFAS No. 153 specifies that a nonmonetary exchange has
commercial substance if the future cash flows of the entity are
expected to change significantly as a result of the exchange.
SFAS No. 153 is effective for nonmonetary asset
exchanges occurring in fiscal periods beginning after
June 15, 2005. The adoption of SFAS No. 153 did
not affect the Company's financial position or results of
operations for the nine-month period ended September 30,
2005.
In September 2005, the Emerging Issues Task Force,
(EITF) reached a consensus concerning the accounting for
linked purchase and sale arrangements in EITF Issue
No. 04-13,
Accounting for Purchases and Sales of
Inventory with the Same Counterparty
. The EITF concluded
that non-monetary exchanges of finished goods inventory within
the same line of business be recognized at the carrying value of
the inventory transferred. The consensus is to be applied to new
buy/sell arrangements entered in reporting periods beginning
after March 15, 2006. The Company does not expect the
impact of this EITF Issue
No.
04-13
consensus to have a material effect on the Company's
financial position or results of operations.
In May 2005, the FASB issued SFAS No. 154,
Accounting Changes and Error Corrections — a
replacement of APB Opinion No. 20 and FASB Statement
No. 3
. This statement changes the requirements for
accounting for and reporting a change in accounting principles
and applies to all voluntary changes in accounting principles.
It also applies to changes required by an accounting
pronouncement in the unusual instance that the pronouncement
does not include specific transition provisions. When a
pronouncement includes specific transition provisions, those
provisions should be followed. This statement requires
retrospective application to prior periods' financial
statements of changes in accounting principles, unless it is
impracticable to determine either the period-specific effects or
the cumulative effect of change. This statement becomes
effective for fiscal years beginning after December 15,
2005. The Company does not expect the adoption of the statement
to have an impact on the Company's financial position and
results of operations.
F-39
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
3.
Acquisitions
Effective April 29, 2005, the Company acquired certain
refinery and crude oil pipeline assets in Tyler, Texas
(collectively, the Refinery) through its wholly owned subsidiary
Delek Refining. Total consideration paid for Refinery assets
approximated $68,084.
In connection with the acquisition, the Company assumed certain
involuntary employee termination benefit liabilities as outlined
in the seller's employee severance plan. The Company is in
the process of finalizing its plan (the Plan) for involuntary
termination but in connection with its purchase price allocation
has included an accrual of approximately $954 for its estimated
settlement of liabilities under the Plan. As of
September 30, 2005, there have been no charges against or
adjustments of this liability. The Company estimates it will
finalize its Plan within one year from the period of
acquisition. Subsequent adjustments as a result of the
Company's finalization of its Plan will be included as
adjustments to the cost of the acquired entity.
In addition to the consideration paid as the acquisition cost
mentioned above for the Refinery, the Company incurred and
capitalized approximately $5,048 in acquisition transaction
costs. The allocation of the aggregate purchase price of the
Refinery acquisition is summarized as follows:
Fixed assets
$
33,819
Inventory
59,885
Prepaid inventory and other assets
26,436
Assumed accounts payable
(37,821
)
Assumed asset retirement obligation
(1,255
)
Assumed environmental liabilities
(7,932
)
$
73,132
The Company consolidated the Refinery's results of
operations beginning April 29, 2005. The unaudited pro
forma consolidated results of operations for the nine months
ended September 30, 2005 as if the Refinery acquisition had
occurred on January 1, 2005 are as follows:
Revenues
$
1,667,833
Income before cumulative effect of change in accounting policy
$44,135
Basic and diluted earnings per share before cumulative effect of
    change in accounting policy
$441,350
On April 30, 2004, the Company completed a stock purchase
agreement with an unrelated third party, whereby the Company
acquired 100% of the issued and outstanding stock of Williamson
Oil Co., Inc. (WOC), an Alabama corporation, which included
operating assets, working capital and related debt for 100
convenience stores located primarily in the state of Alabama. Of
the 100 stores acquired, eleven were owned by WOC but leased to
and operated by unrelated third parties. Thus, 89 stores were
directly operated by WOC. The acquisition included two wholly
owned subsidiaries of WOC that provide wholesale distribution of
fuel and merchandise to unrelated third parties and WOC
operating stores. Total consideration paid in exchange for 100%
of the stock of WOC was $20,751.
In addition to the consideration paid as the acquisition cost
mentioned above for WOC, the Company incurred and capitalized
approximately $2,475 in acquisition transaction costs, of which
$63 and $2,412 was
F-40
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
recorded during 2005 and 2004, respectively. The allocation of
the aggregate purchase price of the WOC acquisition is
summarized as follows:
Fixed assets
$58,830
Inventory
6,938
Cash
985
Other assets
2,641
Goodwill
3,834
Deferred tax liabilities
(8,792
)
Assumed liabilities
(41,210
)
$23,226
The above acquisitions were accounted for using the purchase
method of accounting, as prescribed in SFAS No. 141
and the results of their operations have been included in the
condensed consolidated statements of operations from the dates
of acquisition. The purchase price was allocated to the
underlying assets and liabilities based on their estimated
relative fair values. The final allocation of the Refinery
purchase price is subject to adjustments for a period not to
exceed one year from the consummation date, specifically with
respect to the allocation of the fair value of fixed assets to
specific components and the determination of the Refinery's
asset retirement obligations as required by FIN 47. The
allocation period is intended to differentiate between amounts
that are determined as a result of the identification and
valuation process required by SFAS No. 141 for all
assets acquired and liabilities assumed and amounts that are
determined because information that was not previously
obtainable becomes obtainable. As of June 30, 2005, the
Company had completed its allocation of the purchase price for
the WOC acquisition. During the nine-month period ended
September 30, 2005, the final allocation of the purchase
price for the WOC acquisition resulted in net decreases to
goodwill of $825.
4.
Inventory
Carrying value of inventories consisted of the following:
September 30,
December 31,
2005
2004
Refinery raw materials and supplies
$
24,991
$
—
Refinery work in process
16,619
—
Refinery finished goods
14,590
—
Convenience store fuel
13,356
8,802
Convenience store merchandise
20,869
19,505
Total inventories
$
90,425
$
28,307
5.
Segment Data
Statement of Accounting Standards No. 131,
Disclosures
about Segments of an Enterprise and Related Information
,
requires disclosure of a measure of segment profit or loss. In
connection with the purchase of the Refinery and related assets
on April 29, 2005, management began viewing the
Company's operating results in two reportable segments:
retail and refining.
F-41
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
Retail Segment
The Company operates 328 retail convenience stores throughout
the southeastern United States (177 and 93 of which are located
in Tennessee and Alabama, respectively) as of September 30,
2005. The retail convenience stores, which primarily operate
under the Company's brand names "MAPCO Express",
"Discount Food Mart" and "East Coast" as
well as other non-company proprietary brands, engage in the
retail marketing of gasoline, diesel fuel, other petroleum
products and convenience merchandise.
Refining Segment
Effective April 29, 2005, the Company, as discussed in
note 3, acquired the Refinery which processes a variety of
crude oils, including domestic sweet light crude oil that is
transported through the Company's crude oil pipeline and an
unrelated third party pipeline. The Refinery processes the crude
and manufactures transportation motor fuels including various
grades of gasoline, diesel fuel, aviation fuel and other
petroleum based products that are distributed through its
product terminal located at the Refinery, as well as through
third party pipelines.
Corporate, Other and Eliminations
Operations that are not included in either of the Company's
two reportable segments are included in the category Corporate
and Other. These operations consist primarily of corporate
headquarter operating expenses, depreciation and amortization
expense and interest income and expenses.
The Company measures the operating performance of each segment
within the above two reportable segments, based on the segment
contribution margin. The Company defines segment contribution
margin as net sales less cost of sales and operating expenses,
excluding depreciation and amortization.
For the Retail segment, cost of sales includes the costs of
specific products sold. Store operating expenses, include costs
such as wages of employees at the stores, utility expense for
the stores, lease expense for the stores and other costs of
operating the stores, excluding depreciation and amortization.
For the Refining segment, cost of sales includes all the costs
of crude oil, feedstocks and related transportation. Operating
expenses include the costs associated with the actual operation
of the Refinery, excluding depreciation and amortization.
Prior to the purchase of the Refinery and related assets, the
Company had only the Retail segment, thus segment data prior to
2005 is not applicable.
F-42
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
The following is a summary of business segment operating
performance for the period indicated:
Nine Months Ended September 30, 2005
Corporate,
Other and
Refining
Retail
Eliminations
Consolidated
Net sales (excluding intercompany sales)
$588,326
$798,974
$241
$1,387,541
Intercompany sales
888
—
(888
)
—
Operating costs and expenses:
Cost of goods sold
489,401
690,982
(888
)
1,179,495
Operating expenses
27,636
64,402
248
92,286
Segment contribution margin
$72,177
$43,590
$(7
)
115,760
General and administrative expenses
17,037
Depreciation and amortization
11,472
Gain on disposal of assets
(1,638
)
Losses on forward contract activities
10,923
Operating income
$77,966
Total assets
$301,794
$328,403
$13,333
$643,530
6.
Equity Investment in Related Party LLC
Between June 20, 2002 and December 31, 2003, the
Company was the nominee of its affiliates Delek — The
Israel Fuel Corporation Ltd. (Delek Fuel) and Delek Motors Ltd.
(Delek Motors), each a subsidiary of Delek Group, with regard to
a two-thirds membership interest in another affiliate, El-Ad
Delek LLC (Related Party LLC or the LLC), a Delaware limited
liability company. The two-thirds membership interest in the LLC
was beneficially owned in equal amounts by those affiliates and
held of record by the Company. The LLC is principally engaged in
the ownership and charter operations of a corporate aircraft
based in New Jersey. During this period the Company did not
invest any amounts in this entity, did not exercise control over
this entity and was not entitled to any of the economic benefits
or risks of loss of ownership. On December 31, 2003, the
Company agreed to terminate this nominee arrangement so that
Delek Fuel and Delek Motors would become record, as well as
beneficial, owners of their respective one third
beneficially-owned interests in the LLC held by the Company as
nominee.
Effective December 31, 2003, the Company purchased 33.3% of
the membership interest in the LLC, from Delek Fuel for $6,696.
The Company acquired the interest in the LLC from Delek Fuel by
issuing a variable rate promissory note payable of $6,696 for
which the entire principal balance and interest was due in full
on January 1, 2009. The note bore interest based on LIBOR
plus 1.50% per year.
On May 17, 2004, the Company and Delek Fuel agreed to
terminate this purchase and sale agreement and the related
promissory note payable to Delek Fuel effective
December 31, 2003. In connection with terminating the
agreements effective December 31, 2003, Delek Fuel agreed
to become solely responsible for all income and expense related
to the 33.3% membership interest in the LLC and to cancel the
related note payable as of January 1, 2004. As such, there
are no equity earnings, income or expenses related to the LLC
F-43
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
or interest expense related to the note payable recorded within
the Company's consolidated financial statements for the
year ended December 31, 2004.
7.
Long-Term Obligations
Outstanding borrowings under the Company's existing debt
instruments and capital lease obligations at September 30,
2005 and December 31, 2004 are as follows:
September 30,
December 31,
2005
2004
Notes payable to related parties
$60,000
$28,500
Credit Agreement — Term Loans (A and B)
—
131,900
Credit Agreement — Revolver
—
5,000
SunTrust Term Loan
—
33,700
SunTrust Revolver
—
3,527
Senior Secured Credit Facility — Term Loan
164,588
—
Senior Secured Credit Facility — Revolver
8,000
—
Israel Discount Bank Note
30,000
—
Bank Leumi Note
20,000
—
Capital lease obligations
—
616
Other notes payable
90
90
282,678
203,333
Less:
Current portion of long-term debt
(1,650
)
(19,516
)
Note payable to Related Party — currently due
—
(3,500
)
Current portion of capital lease obligations
—
(389
)
Current portion of other notes payable
(46
)
—
$280,982
$179,928
Notes Payable to Related Parties
During February 2003, the Company signed a note payable with
Delek Group in the amount of $3,500. Proceeds from the note were
used in the February 2003 purchase of seven convenience stores
located in Tennessee. The note bore interest at a rate of
4.0% per annum. On August 17, 2004, the Company
modified the maturity date of this note payable that was
originally due to mature on August 26, 2004. The note
payable, after the modification, was due to mature on
December 31, 2005. During May 2005, the Company repaid all
outstanding principal and interest due under the note.
On April 28, 2004, the Company signed a note payable with
Delek Fuel in the amount of $25,000. Proceeds from the note were
used to fund a portion of the WOC purchase discussed in
note 3. The note bears interest at a rate of 6.30% per
annum with interest and principal payments due upon maturity on
April 27, 2008.
F-44
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
On April 27, 2005, the Company signed a note payable with
Delek Group in the amount of $35,000. Proceeds from the note
were used primarily to fund a portion of the Company's
acquisition of the Refinery discussed in note 3. The note
bears interest at a rate of 7.0% per annum with interest
due and payable in semi-annual installments commencing
July 1, 2007 and principal payments due upon maturity on
April 27, 2010.
Credit Agreement — Term Loans (A and B) and
    Revolver
On July 31, 2002, the Company entered into a Credit
Agreement with Bank Leumi USA (Leumi) and Bank Hapoalim BM
(Hapoalim). Subsequently, during March of 2004 and again in
April of 2004, the Company and the lenders executed an amended
and restated Credit Agreement (the Credit Agreement) which among
other things changed certain covenants of the original agreement
for 2004 and beyond. The Credit Agreement provided two term
loans (Term A and Term B) to the Company in the original
principal amount totaling $158,000 in aggregate, a portion of
the proceeds of which were used to pay off existing borrowings
under two short-term promissory notes. The term loans in the
original and distinct principal amounts of $116,000 and $42,000
were due to mature on July 1, 2011 (Term A) and
July 1, 2007 (Term B), respectively. The Term A loan was
subject to mandatory reductions in principal over its term while
the Term B loan was payable in full upon maturity.
In addition, the Credit Agreement contained a revolving loan
component (the Revolver) not to exceed $20,000, as amended,
which included a sub-facility for letters of credit that at no
time could exceed the borrowing capacity available under the
Revolver.
The Credit Agreement required the Company to comply with certain
financial and non-financial covenants. The Company believes it
was in compliance with all covenant requirements at
December 31, 2004.
In connection with the execution of the Senior Secured Credit
Facility described below, in April 2005, the Company wrote-off
approximately $2,349 of unamortized deferred financing costs
paid in connection with the original execution of the Credit
Agreement. The write-off of these costs is included as a
component of interest expense in the accompanying condensed
consolidated statements of operations for the indicated periods.
SunTrust Term Loan and Revolver
On April 30, 2004, the Company entered into a credit
agreement (the SunTrust Agreement) with SunTrust Bank in its
capacity as the administrative agent for a consortium of
lenders. The SunTrust Agreement provided for a term loan (the
SunTrust Term Loan) in an aggregate principal amount equal to
$34,500. The proceeds were used to pay a portion of the purchase
price of the WOC acquisition discussed in note 3 and
refinance a portion of the related debt acquired. The SunTrust
Term Loan was due to mature on June 30, 2008 and required
mandatory reductions in principal amounts outstanding through
its term. Additionally, the SunTrust Agreement provided for a
revolving loan component (the SunTrust Revolver) not to exceed
$6,000 that was due to mature on April 30, 2008.
The SunTrust Agreement required the Company to comply with
certain financial and non-financial covenants. The Company
believes it was in compliance with all covenant requirements at
December 31, 2004.
In connection with the execution of the Senior Secured Credit
Facility described below, in April 2005, the Company wrote-off
approximately $1,117 of unamortized deferred financing costs
paid in connection with the original execution of the SunTrust
Agreement. The write-off of theses costs is included as a
component of
F-45
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
interest expense in the accompanying condensed consolidated
statements of operations for the indicated periods.
Senior Secured Credit Facility
On April 28, 2005, the Company executed an amended and
restated agreement with a new syndicate of lenders and Lehman
Commercial Paper Inc. serving as administrative agent (the
Senior Secured Credit Facility). In connection with the
execution of the amended and restated agreement, the Company
consolidated the borrowings under its existing Credit Agreement
and SunTrust Agreement into a single credit facility and
increased the borrowing capacity available under the facility to
$205,000.
The Senior Secured Credit Facility consists of a $40,000
Revolving Credit Facility (the Senior Secured Credit Facility
Revolver) and a $165,000 term loan (the Senior Secured Credit
Facility Term Loan). Borrowings under the Senior Secured Credit
Facility are secured by substantially all the assets of the
merged Express and Family Centers.
The Senior Secured Credit Facility Term Loan requires quarterly
principal payments of approximately 0.25% of the principal
balance through March 31, 2011 and a balloon payment of
approximately 94.25% of the principal balance due upon maturity
on April 28, 2011. The Senior Secured Credit Facility
Revolver is payable in full upon maturity on April 28, 2009
with periodic interest repayment requirements. The Senior
Secured Credit Facility Term and Revolver loans bear interest
based on predetermined pricing grids which allow the Company to
choose between a "Base Rate" or "Eurodollar"
loan (as defined in the Senior Secured Credit Facility).
Interest is payable quarterly for Base Rate Loans and the
applicable interest period on Eurodollar Loans. As of
September 30, 2005 the weighted average borrowing rate was
6.7% for the Senior Secured Credit Facility Term Loan and 6.4%
for the Senior Secured Credit Facility Revolver. Additionally,
the Senior Secured Credit Facility requires the Company to pay a
quarterly fee of 0.5% per annum on the average available
revolving commitment. Letters of credit outstanding under this
agreement as of September 30, 2005 totaled approximately
$7,900. Amounts available under the Senior Secured Credit
Facility Revolver as of September 30, 2005 totaled $24,150.
The Senior Secured Credit Facility requires the Company to
comply with certain financial and non-financial covenants.
SunTrust ABL Revolver
On May 2, 2005 the Company entered into a $250,000 asset
based senior revolving credit facility with a syndicate of
lenders led by SunTrust Bank as administrative agent to finance
ongoing working capital, capital expenditures and general needs
of the Refinery. This agreement (the SunTrust ABL Revolver)
which matures on April 29, 2009, bears interest based on
predetermined pricing grids which allow the Company to choose
between a "Base Rate" or "Eurodollar" loan
(as defined in the SunTrust ABL Revolver). Interest is payable
quarterly for Base Rate loans and the applicable interest period
on Eurodollar loans. Availability under the SunTrust ABL
Revolver is determined by a borrowing base defined in the
SunTrust ABL Revolver, supported primarily by certain accounts
receivable and inventory.
Additionally, the SunTrust ABL Revolver supports the
Company's issuances of letters of credit in connection with
the purchases of crude oil for use in the refinery process that
at no time may exceed the aggregate borrowing capacity available
under the SunTrust ABL Revolver. As of September 30, 2005
the Company had no outstanding borrowings under the agreement
but had letters of credit outstanding totaling
F-46
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
approximately $178,000. Amounts available under the SunTrust ABL
Revolver as of September 30, 2005 totaled $72,000.
The SunTrust ABL Revolver contains certain negative covenants
and pledges which prohibit the Company from creating, incurring
or assuming any liens, mortgages, pledges, security interests or
other similar arrangements against the property, plant and
equipment of the Refinery.
Under the SunTrust ABL Revolver, the Company is subject to
certain financial and non-financial covenants.
In connection with the SunTrust ABL revolver, Delek Group
executed a $5,000 guaranty in favor of the lenders. In return,
the Company agreed to pay Delek Group guarantee fees equal to
1.5% per year of the guaranteed amount. The lenders
terminated the guaranty on October 1, 2005.
Israel Discount Bank Note
On April 26, 2005, the Company entered into a $30,000
promissory note with Israel Discount Bank of New York (Israel
Discount Bank Note). The proceeds of this note were used to fund
a portion of the Refinery acquisition discussed in note 3.
The Israel Discount Bank Note matures on April 30, 2007 and
bears interest, payable quarterly, at a spread of 1.375% over
the 90 day London Inter Bank Offering Rate (LIBOR), with
the first interest payment due on April 30, 2006. As of
September 30, 2005 the weighted average borrowing rate on
the Israel Discount Bank Note was 5.04%.
Bank Leumi Note
On April 27, 2005, the Company entered into a $20,000
promissory note with Bank Leumi USA (Bank Leumi Note). The
proceeds of this note were used to fund a portion of the
Refinery acquisition discussed in note 3. The Bank Leumi
Note matures on April 27, 2007 and bears interest, payable
quarterly, at a spread of 1.375% over the LIBOR Rate (Reserve
Adjusted) for a three month term, with the first interest
payment due on April 30, 2006. As of September 30,
2005 the weighted average borrowing rate on the Bank Leumi Note
was 5.06%.
Related Party Letters of Credit
As of September 30, 2005, the Company had letters of credit
for fuel purchases totaling $9,500 issued in the Company's
favor by Delek Fuel.
Guarantee Fees
In connection with the execution of the Credit Agreement, Delek
Fuel entered into a limited guarantee for the benefit of the
Company and in favor of Leumi and Hapoalim. The general terms of
the guarantee required Delek Fuel to guarantee a significant
amount in the event the Company was unable to perform its
payment obligations under the Credit Agreement. The Guarantee
was due to expire on the earlier of July 1, 2011 or the
complete payment satisfaction of all amounts outstanding under
the Credit Agreement. In May 2004, the Company and Delek Fuel
agreed that the Company would pay Delek Fuel a fee for the
guarantee in the amount of $150 per quarter. Further the
Company and Delek Fuel agreed that the payment of this fee would
be effective July 1, 2003. However, during June 2004, the
Company and Delek Fuel terminated the fee agreement effective
April 1, 2004. Subsequently, during September 2004, Delek
Fuel agreed to forgive the
F-47
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
Company of the guarantee fee earned July 1, 2003 through
March 31, 2004 and these fees were subsequently reversed.
In connection with the issuances of the Israel Discount Bank
Note and Bank Leumi Note, Delek Group entered into a limited
guarantee for the benefit of the Company and in favor of Israel
Discount Bank of New York and Bank Leumi USA. The general terms
of the guarantee require Delek Group to guarantee a significant
amount in the event the Company is unable to perform its payment
obligations under the indicated notes. The guarantee expires in
April 2007 or earlier in the event the complete payment
satisfaction of all amounts outstanding under the indicated
notes have been met. In exchange for the guarantee, the Company
has agreed to pay Delek Group an annual fee equal to 1.5% of the
guaranteed amount during the term of the guarantee.
Capital Lease Obligations
In connection with the WOC acquisition on April 30, 2004,
discussed in note 3, the Company assumed certain capital
lease obligations for equipment with two financial institutions.
The leases had original maturity dates ranging from
September 15, 2005 to March 23, 2007 and included
provisions for monthly payments of principal and interest at
rates ranging from 9.40% to 11.54%. In June 2005, in connection
with Family Centers' merger into and with Express, all
amounts owed under the capital lease obligations were repaid and
the leases terminated.
Derivative Instruments
The Company has entered into multiple interest rate swap
agreements on $19,200 of notional principal amounts and multiple
interest rate cap agreements on $145,000 of notional principal
amounts as of September 30, 2005 and December 31,
2004. These agreements are intended to economically hedge
floating rate debt relating to the Company's current
borrowings under the Senior Secured Credit Facility and previous
indebtedness under the Company's Credit Agreement and
SunTrust Agreement, discussed above. However, as the Company has
elected to not comply with the requirements, including formal
hedge designation and documentation, to apply hedge accounting
treatment in accordance with the provisions of
SFAS No. 133, the Company is recording the fair value
of the derivatives in the balance sheet with the offsetting
entry to earnings. The derivative instruments mature on various
dates ranging from January 2006 through July 2010. The estimated
fair value of the Company's interest rate swap and interest
rate cap agreements at September 30, 2005, and
December 31, 2004 totaled $2,935 and $1,921, net,
respectively, and was recorded in other noncurrent assets in the
accompanying condensed consolidated balance sheets.
In accordance with SFAS No. 133, as amended, the
Company recorded non-cash interest (income) expense representing
the change in estimated fair value of the interest rate swap and
interest rate cap agreements of ($1,014) and $875, respectively,
for the nine-month periods ended September 30, 2005 and
2004.
8.
Related Parties
In August of 2004, an officer executed a promissory note in
favor of the Company in the amount of $100. In November 2005, in
connection with an amendment of the officer's employment
agreement, the officer executed an additional promissory note in
the amount of $100 in favor of the Company. These promissory
notes bear no interest and are payable in full upon termination
of the officer's employment with the Company.
F-48
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
As of May 1, 2005, the Company entered into a consulting
agreement with Greenfeld-Energy Consulting, Ltd., a company
owned and controlled by one of the Company's directors.
Pursuant to the consulting agreement the Company compensated
Greenfeld-Energy Consulting, Ltd. approximately $7.0 per month
from May through August 2005 and approximately $8.0 per month
commencing September 2005, plus reasonable expenses for
consulting services relating to the refining industry performed
personally by the director. The agreement continues in effect
until terminated by either party upon six months advance notice
to the other party.
In June 2005, in connection with the Company's refinery
operations, Delek Group guaranteed certain of the Company's
obligations to one of the Company's vendors at the
Refinery, in consideration of which the Company agreed to pay
Delek Group guarantee fees of $12.5 per month for every calendar
month during the quarter in which the Company incurs debt that
is subject to the guaranty.
In August 2005, in connection with the Company's forward
contract activities, Delek Group guaranteed certain of the
Company's obligations up to $25,000. In consideration of
that guaranty, the Company agreed to pay Delek Group quarterly
fees based on 1.5% per year of the average quarterly
exposure to Delek Group as a result of the Company's
forward contract activities. The guaranty was terminated
effective as of January 1, 2006.
Affiliates of the Company provide guarantees to various vendors
supporting the Company's fuel purchasing activities.
9.
Environmental Commitments and Contingencies
Prior to the Company's purchase of the Refinery on
April 29, 2005, the Refinery was the subject of various
state and federal proceedings relating to environmental
regulations, conditions and inquiries, including the Consent
Agreement and Administrative Order discussed below. The former
owner of the Refinery is responsible for payment of any fines or
penalties that may result from settlement of these actions.
However, the Company will have financial and operating
responsibility for implementing required actions to correct
identified deficiencies.
As is the case with most companies engaged in similar
industries, the Company faces potential exposure to future
claims and lawsuits involving environmental matters. The matters
include soil and water contamination, air pollution, personal
injury and property damage allegedly caused by substances which
the Company manufactured, handled, used, released or disposed.
While it is often extremely difficult to reasonably quantify
future environmental related expenditures, the Company
anticipates that continuing capital investments will be required
over the next several years to comply with existing regulations.
Based upon environmental evaluations performed by third parties
subsequent to the Company's purchase of the Refinery, the
Company has recorded a liability of $7,932 as of
September 30, 2005 relative to the probable estimated costs
of remediating certain environmental issues of a non-capital
nature which were assumed in connection with the Company's
acquisition of the Refinery discussed in note 3. This
liability includes estimated costs for on-going remediation
efforts for known and potential contaminations of soil and
groundwater which were already being performed by the previous
owner, as well as estimated costs for additional issues which
have been identified and self reported by the Company subsequent
to the purchase. Approximately $433 of the undiscounted
liability is expected to be expended within the next year with
the remaining balance of $7,499, expendable within the next ten
years. Other than the matters discussed above for which the
Company has recorded a liability and the two environmental
enforcement actions discussed below, the Company has not been
named as defendant in any environmental, health or safety
related litigation.
F-49
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
In February 2005, the prior Refinery owner settled an alleged
violation with the Texas Commission on Environmental Quality
(TCEQ) regarding H2S in the fuel gas system and excess
SO
2
emissions at the Refinery. The former owner paid a penalty and
agreed to take actions to reduce H2S concentrations in the fuel
gas burned by the refinery flares, but did not complete the
actions required by the Administrative Order by the time the
Company consummated the purchase of the Refinery. Consequently,
the Company became responsible for ensuring these actions are
completed in the near future. As these costs are considered
capital in nature, the Company has not accrued any portion of
these costs currently.
In late 2004, the prior Refinery owner began Consent Agreement
negotiations with the Environmental Protection Agency
(EPA) and Department of Justice with respect to a
settlement of issues concerning the application of air quality
requirements to past and future operations at the Refinery. It
is expected that a final settlement will be reached by the end
of 2005. Although the prior owner is responsible for payment of
any penalties resulting for the period prior to the
Company's purchase of the Refinery, the Consent Agreement
will require the Company to make investments at the Refinery,
including the installation of a new electrical substation that
will increase operational reliability and construction of
additional sulfur removal capacity. As these costs are
considered capital in nature, the Company has not accrued any
portion of these costs currently. In addition, the Consent
Decree is expected to require certain on-going operational
changes that will increase future operating expenses at the
Refinery.
The Federal Clean Air Act (CAA) authorizes the EPA to
require modifications in the formulation of the refined
transportation fuel products the Company manufactures in order
to limit the emissions associated with their final use. In
December 1999, the EPA promulgated national regulations limiting
the amount of sulfur to be allowed in gasoline at future dates.
The EPA believes such limits are necessary to protect new
automobile emission control systems that may be inhibited by
sulfur in the fuel. The new regulations required the phase-in of
gasoline sulfur standards beginning in 2004, with special
provisions for small refiners or those receiving a waiver. The
Company received a waiver from the EPA that postpones
requirements for the lowest sulfur standards until 2007 or 2008,
depending on the specific compliance options chosen under the
agreement with the EPA.
The EPA promulgated regulations that will limit the sulfur
content of highway diesel fuel beginning in 2006 to 15
parts-per-million (ppm). The current standard is 500 ppm.
In June 2004, the EPA issued new regulations that will limit
emissions from diesel fuel powered engines used in non-road
activities such as mining, construction, agriculture, railroad
and marine and will simultaneously limit the sulfur content of
diesel fuel used in these engines to facilitate compliance with
the new emission standards. The regulations provide for a timed
phase-in of the non-road low sulfur requirements extending
beyond the on-road diesel deadlines. As required by the gasoline
sulfur waiver from the EPA, the Company plans to meet the
ultimate 15 ppm standard for at least 95% of the on-road
highway diesel fuel and the non-road diesel fuel manufactured by
June 1, 2006.
The TCEQ has promulgated regulations requiring the use of only
Low Emission Diesel (LED) in counties east of Interstate 35
beginning in October, 2005. The Company has received approval to
meet these requirements for diesel sales east of I-35 by selling
diesel that meets the federal ultra-low sulfur requirements,
ahead of the federally required schedule. Additional diesel
volumes that meet the LED requirements may be manufactured using
fuel additives approved by the TCEQ.
The Comprehensive Environmental Response, Compensation and
Liability Act (CERCLA), also known as "Superfund,"
imposes liability, without regard to fault or the legality of
the original conduct, on certain classes of persons who are
considered to be responsible for the release of a
"hazardous substance" into the
F-50
Table of Contents
DELEK US HOLDINGS, INC. AND SUBSIDIARIES
(A Subsidiary of Delek Group Ltd.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) — (Continued)
(In thousands, except share and per share data)
September 30, 2005
environment. These persons include the owner or operator of the
disposal site or sites where the release occurred and companies
that disposed or arranged for the disposal of the hazardous
substances. Under CERCLA, such persons may be subject to joint
and several liabilities for the costs of cleaning up the
hazardous substances that have been released into the
environment, for damages to natural resources and for the costs
of certain health studies. It is not uncommon for neighboring
landowners and other third parties to file claims for personal
injury and property damage allegedly caused by hazardous
substances or other pollutants released into the environment.
Analogous state laws impose similar responsibilities and
liabilities on responsible parties. In the course of the
Company's current ordinary operations, the Company has
generated waste, some of which falls within the statutory
definition of a "hazardous substance" and some of
which may have been disposed of at sites that may require
cleanup under Superfund. At this time the Company has not been
named a party at any Superfund sites and under the terms of the
purchase agreement, did not assume any liability for wastes
disposed of prior to the Company's ownership of the Tyler
Refinery and related pipeline.
10.
Employment Agreement
The Company maintains an employment agreement with an executive
officer which contains a deferred compensation element. Based on
the agreement, the officer is entitled to one, but not both, of
the issuance of shares pursuant to share purchase rights or a
cash award. The share purchase rights award totals 5% of the
Company's outstanding shares and vests ratably over the
five-year period of the agreement, but is contingent upon the
Company completing an initial public offering during the five
year period ending April 30, 2009. As the exercise of these
share purchase rights is contingent on the completion of an
initial public offering, in accordance with Accounting
Principles Board No. 25,
Accounting for Stock Issued to
Employees,
compensation expense will only be recognized upon
satisfaction of the contingency. Accordingly, upon completion of
an initial public offering, compensation expense would be
recorded for the vested portion of the share purchase rights
based on the five-year vesting period and calculated as the
difference in the stipulated exercise price and the fair value
of the award on that date.
As long as the Company does not complete an initial public
offering, the officer is entitled to a cash award which may not
exceed $3,000 over the five year period dependent on the
Company's performance. The Company has accrued
approximately $400 under this agreement as of September 30,
2005.
11.
Subsequent Event
In December 2005, the Company acquired 21 convenience
stores and four undeveloped properties in the Nashville market
from BP Products North America Inc. (BP Acquisition). Total
consideration paid for the BP Acquisition approximated $35,027.
In connection with this acquisition, the Company increased the
Senior Secured Credit Facility Revolver by $30,000 to $70,000.
F-51
Table of Contents
REPORT OF INDEPENDENT AUDITORS
To the Stockholders of Crown Central Petroleum Corporation
We have audited the accompanying combined balance sheets of the
Tyler Refinery and McMurrey Pipeline operations (the
Company — a business component of Crown Central
Petroleum Corporation) as of December 31, 2004 and 2003 and
the related combined statements of operations, changes in
owner's net investment and cash flows for each of the three
years in the period ended December 31, 2004. These
financial statements are the responsibility of the
Company'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. Those standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. We were not engaged to perform an audit
of the Company's internal control over financial reporting.
Our audits included consideration of internal control over
financial reporting as a basis for designing audit procedures
that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the
Company's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by
management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the combined financial statements referred to
above present fairly, in all material respects, the combined
financial position of the Tyler Refinery and McMurrey Pipeline
operations at December 31, 2004 and 2003, and the combined
results of their operations and their cash flows for each of the
three years in the period ended December 31, 2004, in
conformity with accounting principles generally accepted in the
United States.
/s/ Ernst & Young LLP
Baltimore, Maryland
December 21, 2005
F-52
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
COMBINED BALANCE SHEETS
(Thousands of dollars)
December 31,
2004
2003
ASSETS
Current assets
Cash and cash equivalents
$—
$1
Accounts receivable, less allowance for doubtful accounts
(2004 — $1,148; 2003 — $1,052)
86,055
68,927
Inventories, net of LIFO reserves (2004 — $21,183;
    2003 — $10,625)
30,945
40,743
Prepaid crude inventory
53,279
—
Other current assets
6,489
1,952
Current deferred tax assets
8,361
5,683
Total current assets
185,129
117,306
Deferred turnaround
1,024
5,197
Property, plant and equipment
Land
313
539
Petroleum refineries
23,826
34,397
Marketing facilities
994
1,129
Furniture and other equipment
2,326
2,560
27,459
38,625
Less allowance for depreciation
10,220
7,445
Net property, plant and equipment
17,239
31,180
Other assets
—
6,058
Total assets
$
203,392
$
159,741
LIABILITIES AND OWNER'S NET INVESTMENT
Current liabilities
Accounts payable:
Crude oil and refined products
$57,294
$96,710
Other
5,111
3,923
Accrued liabilities
14,607
9,093
Total current liabilities
77,012
109,726
Deferred income taxes
2,554
9,360
Other deferred liabilities
8,174
8,307
Total owner's net investment
115,652
32,348
Total liabilities and owner's net investment
$
203,392
$
159,741
See accompanying notes.
F-53
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
COMBINED STATEMENTS OF OPERATIONS
(Thousands of dollars)
Year Ended December 31
2004
2003
2002
Revenues
Sales and operating revenues
$
703,994
$
349,026
$
337,411
Sales to affiliated party
135,218
320,612
297,176
Total sales
839,212
669,638
634,587
Operating costs and expenses
Costs of sales and operating expenses
664,224
331,258
325,436
Cost of sales to affiliated party
131,854
321,589
296,878
Selling and administrative expenses
4,074
4,466
3,784
Depreciation and amortization
5,891
5,958
5,313
(Gain) on sales and abandonments of property and equipment
(95
)
—
—
Impairment loss on property and equipment
15,301
—
—
821,249
663,271
631,411
Operating income
17,963
6,367
3,176
Interest and other income, net
2,221
1,662
3,968
Income before tax
20,184
8,029
7,144
Income tax expense
6,987
2,979
2,590
Net income
$13,197
$5,050
$4,554
See accompanying notes.
F-54
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(a Business Component of Crown Central Petroleum
Corporation)
COMBINED STATEMENTS OF CHANGES IN OWNER'S NET
INVESTMENT
(Thousands of dollars, except share amounts)
Retained
Accumulated
Total
Owner's
Earnings/
Other
Owner's
Net
Accumulated
Comprehensive
Net
Investment
Deficit
Income/Loss
Investment
Balance at December 31, 2001
$63,115
$(24,528
)
$—
$38,587
Comprehensive income (loss):
Net income for 2002
4,554
4,554
Adjustment to minimum pension liability (net of tax of $1,538)
(2,509
)
(2,509
)
Comprehensive income
2,045
Net transactions with owner
(2,595
)
(2,595
)
Balance at December 31, 2002
60,520
(19,974
)
(2,509
)
38,037
Comprehensive income (loss):
Net income for 2003
5,050
5,050
Adjustment to minimum pension liability (net of tax of $13)
(21
)
(21
)
Comprehensive income
5,029
Net transactions with owner
(10,718
)
(10,718
)
Balance at December 31, 2003
49,802
(14,924
)
(2,530
)
32,348
Comprehensive income (loss):
Net income for 2004
13,197
13,197
Adjustment to minimum pension liability (net of tax of $465)
(759
)
(759
)
Comprehensive income
12,438
Net transactions with owner
70,866
70,866
Balance at December 31, 2004
$120,668
$(1,727
)
$(3,289
)
$115,652
See accompanying notes.
F-55
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(a Business Component of Crown Central Petroleum
Corporation)
COMBINED STATEMENTS OF CASH FLOWS
(Thousands of dollars)
Year Ended December 31
2004
2003
2002
Cash flows from operating activities:
Net income
$13,197
$5,050
$4,554
Reconciling items from net income to net cash used in operating
    activities:
Depreciation and amortization
5,891
5,958
5,313
Impairment loss on property and equipment
15,301
—
—
Net gain on sales of property and equipment
(95
)
—
—
Deferred income tax expense/(benefit)
(9,019
)
(969
)
(2,237
)
Other deferred items
(1,050
)
577
(3,991
)
Changes in assets and liabilities:
Accounts receivable
(17,128
)
(3,516
)
(24,566
)
Inventories
9,798
5,839
(12,316
)
Prepaid crude inventory
(53,279
)
—
—
Other assets
1,521
(6,302
)
(909
)
Crude oil and refined products payable
(39,416
)
5,506
33,774
Other accounts payable
1,188
905
120
Accrued liabilities and other deferred liabilities
4,936
1,360
4,070
Net cash (used in) provided by operating activities
(68,155
)
14,408
3,812
Cash flows from investing activities
Capital expenditures
(2,807
)
(1,255
)
(1,576
)
Proceeds from sales of property and equipment
95
—
—
Deferred turnaround maintenance
—
(2,527
)
—
Net cash used in investing activities
(2,712
)
(3,782
)
(1,576
)
Cash flows from financing activities
Net transactions with owner
70,866
(10,718
)
(2,595
)
Net cash provided by (used in) financing activities
70,866
(10,718
)
(2,595
)
Net decrease in cash and cash equivalents
(1
)
(92
)
(359
)
Cash and cash equivalents at beginning of year
1
93
452
Cash and cash equivalents at end of year
$—
$1
$93
Supplemental disclosures of cash flow information
Cash paid during the year for:
Interest
$—
$4
$2
Incomes taxes
893
181
193
See accompanying notes.
F-56
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS
Year Ended December 31, 2004
1.     Description of Business and
Summary of Accounting Policies
Basis of Presentation
The accompanying financial statements have been prepared from
Crown Central Petroleum Corporation's (Crown) historical
accounting records and represent the combined financial
position, results of operations and cash flows reflecting
assets, liabilities, and operations of Crown's Tyler
Refinery and McMurrey Pipeline operations (the Company). The
disclosures in the notes to the combined financial statements
relate solely to those assets and exclude all other Crown
operations. As more fully described below, the combined
financial statements for all periods presented include
allocations of Crown corporate and general administrative
expenses. For financial reporting purposes, the net intercompany
financing activities of the Company and Crown have been
accumulated into a single caption entitled "owner's
net investment."
Locot Corporation (Locot), is a wholly-owned subsidiary of
Crown, which is a wholly owned subsidiary of Rosemore Holdings,
Inc., which in turn is a wholly owned subsidiary of Rosemore,
Inc. (Rosemore). Crown and Locot are the parent companies of
La Gloria Oil and Gas Company (La Gloria), which owns
and operates the Tyler Refinery, and through a subsidiary, the
McMurrey pipeline gathering system in Texas.
The financial statements of the Company are not necessarily
indicative of the financial position, results of operations and
cash flows that might have occurred had the Company not been
integrated into Crown's other operations. Also, they may
not be indicative of the actual financial position that might
have otherwise resulted, or of future results of operations or
financial position of the Company.
Description of
Business
The Company operates as an independent refiner and marketer of
petroleum products, including petrochemical feedstocks. The
Company operates a refinery in Tyler, Texas with a rated
capacity of 52,000 barrels per day (BPD) of crude oil. There was
no debt directly related to the Tyler Refinery, as such, no
interest expense was allocated to it.
There were 219, 226, and 239 employees at December 31,
2004, 2003, and 2002, respectively. Approximately two-thirds of
the Tyler Refinery employees are subject to collective
bargaining agreements. The Company's collective bargaining
agreement with the Paper, Allied-Industrial, Chemical and Energy
Workers International Union (PACE), covering employees at the
Tyler Refinery expired on March 31, 2004. However, the
parties have agreed to a series of extensions that continue the
terms of the contract through December 31, 2005.
As more fully described in Note 10 to these financial
statements, on March 14, 2005, La Gloria executed a
Purchase and Sale Agreement for the sale of the Company (the
Tyler Refinery and McMurrey Pipeline). Under the terms of the
agreement, the buyer offered to employ most of the
Company's employees at the facilities and will recognize
the unions by whom certain of the Company's employees at
the Refinery are represented. La Gloria completed the sale
of the Company on April 29, 2005 for $16.6 million
plus the value of the remaining inventory.
The following summarized the significant accounting policies and
practices followed by the Company:
Use of Estimates
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those
estimates.
F-57
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
Allocation of Costs from
Crown
The financial statements reflect a charge from Crown for the
estimated costs of certain functions that are managed by the
parent and can reasonably be directly attributed to the
operation of the Company. These costs include corporate senior
management, human resources, legal, accounting and
information-system support. The charges are based on
management's estimate of such services specifically used by
the Company. The determination of cost was based on methods and
criteria that management believes are equitable and provide a
reasonable estimate of the cost attributable to the Company. The
total of these allocations for the years ending
December 31, 2004, 2003, and 2002 were $3.5 million,
$3.6 million, and $3.8 million, respectively.
Cash and Cash Equivalents
Cash in excess of daily requirements is invested in marketable
securities with maturities of three months or less. Such
investments are deemed to be cash equivalents for purposes of
the Statements of Cash Flows. Cash with restrictions on usage
are not deemed to be cash equivalents for purposes of the
Balance Sheets and the Statements of Cash Flows. During 2003,
Crown began to centralize all cash management and subsequently
all Company bank accounts were closed. All subsequent cash
receipts and disbursements were transacted using Crown's
bank accounts.
Accounts Receivable
The majority of the Company's accounts receivable relate to
sales of petroleum products to third parties operating in the
petroleum industry. As of December 31, 2004 and 2003, one
independent customer balance comprised 32.8% and 32.0%,
respectively, of the Company's gross accounts receivable.
Accounts receivable are recorded at the amounts billed to the
customers less an allowance for those balances that management
estimates may ultimately not be collected. The allowance for
doubtful accounts is determined by specific identification of
potentially uncollectible accounts.
Credit Risk
The Company evaluates the credit worthiness counterparties to
futures, forwards, and exchange traded options and as a result
considers non-performance credit risk to be remote. The amount
of exposure with such counterparties is generally limited to
unrealized gains on outstanding contracts. The Company is also
exposed to credit risk of counterparties to product exchange
transactions. The Company evaluates the credit worthiness of its
product exchange counterparties and considers non-performance
credit risk to be remote.
Inventories
The Company's crude oil and refined products are valued at
the lower of cost (last-in, first-out) or market. Materials and
supplies inventories are valued at cost. Incomplete exchanges of
crude oil and refined products due the Company or owing to other
companies are reflected in the inventory accounts. Prepaid crude
inventory represents advance payments for future crude
deliveries and is valued at the lower of cost (on a first-in,
first-out basis) or market and is not considered in the last-in,
first-out basis until the crude is physically received by the
Company.
Other Assets
Other current assets as of December 31, 2004 and Other
Assets as of December 31, 2003 include a $6.1 million
refundable deposit with an insurance carrier. As discussed
further in Note 10, subsequent to the
F-58
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
year ended December 31, 2004, La Gloria executed a purchase
and sale agreement for sale of Company (the Tyler Refinery and
McMurrey Pipeline assets) and Crown collected the refundable
deposit.
Property, Plant and Equipment
Property, plant and equipment is carried at cost. Depreciation
and amortization of plant and equipment are primarily provided
using the straight-line method over estimated useful lives.
Construction in progress is recorded in property, plant and
equipment.
Expenditures that materially increase values, change capacities
or extend useful lives are capitalized in property, plant and
equipment. Routine maintenance, repairs and replacement costs
are charged against current operations.
Upon sale or retirement, the costs and related accumulated
depreciation or amortization are eliminated from the respective
accounts and any resulting gain or loss is included in operating
results.
In accordance with Statement No. 144,
Accounting for the
Impairment or Disposal of Long-Lived Assets
(Statement No.
144), the Company records impairment losses on long-lived assets
used in operations when events and circumstances indicate that
long-lived assets might be impaired and the undiscounted cash
flows estimated to be generated by those assets are less than
the carrying amounts of those assets. At December 31, 2004,
indications of value derived from marketing the assets for sale
and difficulties in finding a financially capable buyer for the
Tyler Refinery asset group were indicators that it was
potentially impaired. On March 14, 2005, La Gloria executed
a Purchase and Sale Agreement for the sale of the Company. The
sales price less costs to sell was less than the carrying value
of the assets at December 31, 2004. While this agreement to
sell the Tyler Refinery asset group was contingent upon several
factors, including but not limited to the buyer's due
diligence, approval of the transaction under the Hart-Scott
Rodino Act, receipt by the buyer of an EPA Hardship Waiver
pertaining to gasoline sulphur standards, and other requisite
consents, licenses and approvals, it was the most objective
representation of the fair value of the Tyler Refinery asset
group available at the time. Accordingly, as required by
statement. No 144, the Tyler Refinery and McMurrey Pipeline
assets were written down by approximately $15.3 million at
December 31, 2004 to reflect the estimated fair market
value of the assets. Subsequent to March 14, 2005, on
April 29, 2005, la Gloria completed its sale of the Company
assets for $16.6 million plus the value of the remaining
inventory.
Depreciation expenses related to property, plant and equipment
were approximately $2.7 million, $2.9 million and
$2.8 million in the years ended December 31, 2004,
2003, and 2002, respectively.
Refinery Turnaround Costs
Refinery turnaround costs are incurred in connection with the
Company's planned shutdown and inspection of the
refineries' major units to perform necessary repairs and
replacements. Refinery turnaround costs are deferred when
incurred and amortized on a straight-line basis over that period
of time estimated to lapse until the next planned turnaround
occurs. The frequency of refinery turnarounds varies with each
operating unit. Refinery turnaround costs include, among other
things, the cost to repair, restore, refurbish or replace
refinery equipment such as vessels, tanks, reactors, piping,
rotating equipment, instrumentation, electrical equipment, heat
exchangers and fired heaters.
Turnaround amortization expenses were approximately
$3.1 million, $3.0 million, and $2.5 million in
the years ended December 31, 2004, 2003, 2002, respectively.
F-59
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
Environmental Costs
The company conducts environmental assessments and remediation
efforts at the Tyler Refinery and McMurrey Pipelines facilities.
Estimated closure and post-closure costs for active refineries
are not recorded until a decision for closure is made. Estimated
closure and post-closure costs and costs of environmental
matters related to ongoing refinery operations are recorded as
follows: Expenditures for equipment necessary for environmental
issues relating to ongoing operations are capitalized. The
Company accrues environmental and clean-up related costs of a
non-capital nature when it is both probable that a liability has
been incurred and that the amount can be reasonably estimated.
Accruals for losses from environmental remediation obligations
generally are recorded no later than completion of the
remediation feasibility study. Estimated costs, which are based
upon experience and assessments, are recorded at undiscounted
amounts without considering the impact of the inflation, and are
adjusted periodically as additional or new information becomes
available.
Income Taxes
The operations of the Company are included in the consolidated
federal income tax return of Crown. For financial reporting
purposes, the Company has calculated income tax expenses
attributable to its operations using the separate return method.
Under this method, the Company has assumed that it is a separate
taxpayer in each jurisdiction in which it conducts operations.
Income taxes attributable to the Company's operations that
were paid or accrued by Crown are included as a component of
owner's net investment.
Deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets
and liabilities are measured using enacted rates expected to
apply to taxable income in the years that those temporary
differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the
enactment date. A valuation allowance is recognized if, based on
managements judgment, it is more-likely-than-not that some
portion, or all, of the deferred tax asset will not be realized.
Asset Retirement Obligations
Effective January 1, 2003, the Company adopted the
provisions of Statement of Financial Accounting Standard
No. 143,
Accounting for Asset Retirement Obligations
(SFAS No. 143). This statement significantly
changed the method of accruing costs that an entity is legally
obligated to incur associated with the retirement of fixed
assets. Under SFAS No. 143, the fair value of a
liability of an assets retirement obligation is recognized in
the period in which it is incurred if a reasonable estimate of a
value can be made.
The Company has legal asset retirement obligations for several
assets, including its refinery and pipeline, for which it is not
possible to estimate when the obligations will be settled.
Consequently, the retirement obligations for these assets cannot
be measured at this time
Owner's Net Investment
Owner's net investment consists of Crown's initial
investment in the Company and subsequent changes in Crown's
net investment resulting from the use of centralized cash
management accounts. Substantially all payments from the
Company's customers are received by Crown and substantially
all expenses and fixed asset additions of the Company are paid
by Crown. In addition, Crown allocates corporate general and
administrative expenses to the Company based on the analysis of
the components of the Crown's corporate general and
administrative expenses and the estimated percentage of each
component attributable to the
F-60
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
Company. Corporate general and administrative expense consists
principally of corporate compensation expense. Management
believes that the method used to allocate these expenses is
reasonable. Allocated indirect overhead costs consists
principally of the following:
•
Corporate human resources
•
Finance, accounting, legal, and administration;
•
Information technology management services.
No interest expenses incurred by Crown for general corporate
debt has been allocated to the Company.
Sales and Operation Revenues
Revenues are recognized net of excise and other taxes when
products are sold, delivered and collectibility is reasonably
assured. Resales of crude oil are recorded net of the related
crude oil cost
(first-in,
first-out)
in sales and operating revenues.
Crude oil and refined product exchange transactions, which are
entered into primarily to acquire crude oil and refined products
of a desired quality or at a desired location, are netted in
cost of products sold and operating expenses in the statements
of operations based upon the concepts set forth in APB Opinion
No. 29,
Accounting for Nonmonetary Transactions.
Interest and Other Income, Net
Interest and other income, net, primarily consists of
intercompany interest charged by the Company on net amounts due
to the Company from its parent, Crown. Amounts due to the
Company from Crown, including interest, are classified as
Owner's Net Investment.
Recent Accounting Pronouncements
In November 2004, the FASB issued Statement of Financial
Accounting Standards No. 151,
Inventory Costs
(FASB 151). The Company is required to adopt the provisions
of FASB 151, on a prospective basis, as of January 1,
2006. FASB 151 clarifies the accounting for abnormal
amounts of idle facility expense, freight, handling costs, and
wasted material. FASB 151 requires that those
items — if abnormal — be recognized as
expenses in the period incurred. In addition, FASB 151
requires the allocation of fixed production overheads to the
costs of conversions based upon the normal capacity of the
production facilities. The Company has not yet determined what
effect FASB 151 will have on its earnings and financial
position.
In March 2005, the FASB issued FASB Interpretation No. 47,
Accounting for Conditional Asset Retirement Obligations
(FASB Interpretation No. 47), which is an interpretation of
SFAS No. 143. This interpretation is effective no later
than the end of fiscal years ending after December 15, 2005
and clarifies terminology within FAS 143 and requires
companies to recognize a liability for the fair value of a
conditional asset retirement obligation when incurred if the
liability's fair value can be reasonably estimated. The
impact of the adoption of FASB Interpretation No. 47 on the
Company's financial statements has not yet been determined.
F-61
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
2.     Inventories
Inventories consisted of the following:
2004
2003
(Thousands of dollars)
Crude oil
$26,361
$21,449
Refined products
25,240
28,920
Total inventories at FIFO (approximates current cost)
51,601
50,369
LIFO reserves
(21,183
)
(10,625
)
Total crude oil and refined products
30,418
39,744
Materials and supplies inventory at FIFO
527
999
Total Inventory
$30,945
$40,743
In 2004 and 2003, the Company liquidated a portion of its LIFO
inventory quantities. The impact of these liquidations, based on
the difference between LIFO costs and current costs, resulted in
a reduction in costs and operating expenses of $6.6 million
in 2004 and $1.6 million in 2003.
3.
Credit Arrangements
Crown maintains a Loan and Security Agreement, as amended
(Secured Credit Facility), which is used to provide cash
borrowings and letters of credit for general corporate and
working capital requirements and was extended until
January 24, 2005. The Secured Credit Facility, which is
collateralized by virtually all assets, includes limitations on
additional indebtedness and cash dividends. Effective
December 31, 2003, Crown was no longer required to comply
with financial covenants requiring the maintenance of minimum
levels of adjusted working capital, net worth and cash flow.
Crown pays a fee for unused commitments. Cash borrowings under
the Secured Credit Facility are limited to $50 million and bear
interest based on the prime rate. There is no such sub-limit for
the issuance of letters of credit.
At December 31, 2004, the total commitments within the
Secured Credit Facility were approximately $75 million,
with $25 million provided by bank participants and
$50 million from an affiliate of Rosemore, a related party
to the Company. The bank commitments are subject to the
availability of eligible collateral, which totaled
$132.5 million at December 31, 2004, after the
application of reserves. The remaining availability, which is
provided by Rosemore, is not subject to the limitation of
eligible collateral. As of December 31, 2004, Crown had no
cash borrowings and $34.9 million of outstanding letters of
credit issued pursuant to the Secured Credit Facility, with
remaining unused commitments of $40.1 million. Cash
borrowings and outstanding letters of credit at
December 31, 2003, were $30.4 million and
$37.1 million, respectively. The Company had no cash
borrowings in any year. Letters of Credit directly attributable
to the Company operations were $30.3 million at
December 31, 2004 and $26.0 million at December 31,
2003.
The Secured Credit Facility was amended as of January 25,
2005, with the bank participation adjusted to $40 million
and Rosemore participations adjusted to $70 million for a
total commitment of $110 million. The total bank commitments are
collateralized by 85% of eligible accounts receivables plus the
lesser of, 60% of the value of eligible inventories or
$25 million for a combined maximum of $40 million. The
remaining availability, which is provided by Rosemore, is not
subject to the limitation of eligible collateral. The maturity
date of the facility is defined as the earlier of
December 31, 2005 or the date of closing on the sale of the
Tyler Refinery. No contractual reductions of the Rosemore
participation are provided or contemplated. Fees and expenses
related to the issuances of letters of credit are included in
cost of the materials purchased.
F-62
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
4.
Derivatives and Hedging Activities
The Company uses futures, forwards and swaps to manage the price
risk inherent in purchasing crude oil in advance of the delivery
date, and in maintaining the value of inventories contained
within its refinery and pipeline system. The Company's risk
management policy sets forth the hedging strategies used to
manage the price risks. The strategies include fixing a future
margin between crude oil and certain finished products, and also
hedging fixed price purchase and sale commitments of crude oil
and refined products. These instruments generally allow for
settlement at the end of their term in either cash or product.
In accordance with SFAS No. 133,
Accounting for
Derivative Instruments and Hedging Activities
, the Company
recognizes all derivatives as either assets or liabilities in
the balance sheet and those instruments are measured at fair
value. Certain derivatives, which are transacted pursuant to the
Company's risk management policy to manage price risk, do
not qualify or at the Company's discretion, are not
designated as hedges under Statement No. 133. These
contracts are accounted for on the mark-to-market basis of
accounting and as such changes in the fair value of the
derivatives are recorded each period in earnings.
As of December 31, 2004 and 2003, the Company had recorded
derivatives in its other current assets and crude oil and
refined products payable from operations at the Tyler Refinery
of $2.0 million and $0.1 million, respectively. For
the years ended December 31, 2004, 2003, 2002, the Company
recorded losses of $2.9 million, $2.4 million, and
$4.7 million, respectively, representing the change in the
fair value of the Company's derivative financial
instruments and hedging activities used to hedge inventory
costs. These amounts were related to operations at the Tyler
Refinery and as such are recognized in costs and operating
expenses in the Combined Statements of Operations. As of
December 31, 2004 and 2003 the Company had no derivative
financial instruments designated as hedges.
The Company has fixed-price, firm purchase and sale commitments
for crude and related products that meet the requirements to be
designated as normal purchases or sales transactions and
therefore are not subject to the requirements of SFAS
No. 133. The Company specifically designates each firm
commitment as a normal purchase or normal sale upon execution.
No unrealized gains are recognized on firm commitments
designated as normal purchases or normal sales. The Company
evaluates these contracts for lower-of-cost-or-market
implications, and where necessary, provides an allowance to
write-down to market.
5.
Employee Benefit Obligations
Crown has a defined benefit pension plan covering the majority
of the Company's full-time employees. Plan benefits are
generally based on years of service and on the employee's
average compensation. Crown's policy is to fund the pension
plans in amounts that comply with contribution limits imposed by
law. Plan assets consist principally of fixed income securities
and stocks.
In 2003, Crown completed an analysis of its company-sponsored
employee and retiree benefits programs and made the following
changes that affected the Company: 1) The Company has
frozen benefits and participation in its defined benefit pension
plan (Retirement Plan) for all of the Company's full-time
employees, effective July 1, 2003 resulting in a benefit
obligation reduction from the curtailment of $4.8 million.
For the participants covered by the freeze in the Retirement
Plan, only the participant's compensation and years of
service earned prior to the date of the freeze is considered in
the calculation of the retirement benefit. Participant vesting
continues to accrue based on years of service provided before
and after the freeze on a basis consistent with the Retirement
Plan prior to the freeze. No new Company employees are eligible
to participate in the Retirement Plan after July 1, 2003.
2) The Company eliminated its subsidy for all medical
coverage for retirees, effective August 1, 2003. As of that
date, retirees were offered medical coverage but only on a fully
retiree-paid basis.
F-63
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
The estimated impact of freezing the Retirement Plan for Company
employees was $0.5 million reduction in funding for the
Retirement Plan in 2003. Employer contributions to the
Retirement Plan were $1.5 million and $0.4 million in
2004 and 2003, respectively. It should be noted that the actual
future cash funding requirements and pension expense under
generally accepted accounting principles will be determined
based upon the actual performance of the Retirement Plan's
assets as compared to the actuarial assumptions used. Pension
related expenses decreased approximately $0.9 million in
2004 when compared to the prior year due primarily to a decrease
in the recognition of actuarial losses and a decrease in the
service cost-benefit earned during the year.
As a condition of the sale of certain Crown assets unrelated to
the Company, Crown reached an agreement with the Pension Benefit
Guaranty Corporation (PBGC) with respect to the underfunding of
Crown's Retirement Plan by agreeing to pay $45 million
into the Retirement Plan from the proceeds of the Pasadena and
Tyler Refinery sales. In addition, Rosemore assumed sponsorship
of the Plan. A deposit into Crown's Retirement Plan of
$7.5 million was made at the closing of the Pasadena
Refinery in early 2005. The remaining $37.5 million will be
paid according to the following schedule: (1) another
deposit of $10 million to the Retirement Plan will be made
on June 30, 2005, with a final payment of
$27.5 million made no later than June 30, 2006, or
(2) upon the sale of the Tyler Refinery, whichever occurs
earlier. Effective May 6, 2005, all funds due had been
deposited to the Retirement Plan in accordance with the PBGC
agreement.
The following table sets forth the changes in the benefit
obligation and plan assets of the Company's pension plans
for the years ended December 31, 2004 and 2003,
respectively:
December 31
2004
2003
(Thousands of dollars)
Change in pension plans' benefit obligation
Pension plans' benefit obligation — beginning of
    year
$30,079
$30,184
Service cost
122
659
Interest cost
1,857
1,951
Benefits paid
(1,299
)
(1,071
)
Administrative expenses
(229
)
(124
)
Actuarial loss
1,333
3,332
Curtailment
—
(4,852
)
Pension plans' benefit obligation — end of year
31,863
30,079
Change in pension plan assets
Fair value of plan assets — beginning of year
22,201
19,262
Actual return on plan assets
1,881
3,725
Benefits paid
(1,299
)
(1,071
)
Contributions
1,519
396
Administrative expenses
(219
)
(111
)
Fair value of plan assets — end of year
24,083
22,201
Reconciliation of funded status
Unfunded status benefit obligation
(7,780
)
(7,878
)
Unrecognized actuarial loss
5,313
4,091
Unrecognized net asset at transition
—
—
Unrecognized prior service cost
(8
)
(10
)
Net amounts recognized at end of year
$(2,475
)
$(3,797
)
F-64
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
Amounts recognized in the Balance Sheets consisted of:
Year Ended
December 31
2004
2003
(Thousands of dollars)
Accrued pension liability
$(7,780
)
$(7,878
)
Accumulated other comprehensive income
5,305
4,081
Net amounts recognized at end of year
$(2,475
)
$(3,797
)
Other comprehensive income/ (loss) attributable to change in
    additional minimum liability recognition
$1,224
$34
Net periodic pension costs consisted of the following components:
Year Ended December 31
2004
2003
2002
(Thousands of dollars)
Service cost — benefits earned during the year
$122
$659
$1,011
Interest cost on projected benefit obligations
1,857
1,951
1,898
Expected return on plan assets
(1,988
)
(1,758
)
(2,099
)
Amortization of prior service cost
(2
)
(9
)
(15
)
Recognized actuarial loss/(gain)
208
405
—
Curtailment credit
—
(110
)
—
Amortization of transition asset obligation
—
(12
)
(47
)
Net periodic pension cost
$197
$1,126
$748
Assumptions used in the accounting for the defined benefit plans
as of December 31 were:
2004
2003
2003
Weighted average discount rates
6.00%
6.25%
6.75%
Rates of increase in compensation levels
3.00%
3.00%
3.00%
Expected long-term rate of return on assets
9.00%
9.00%
9.75%
The 2004 rate increase assumption of 3% relates primarily to
those participants covered by a collective bargaining agreement
that are not subject to the Company's decision to freeze
the Retirement Plan.
The Company's Retirement Plan projected benefit obligations
and accumulated benefit obligations were $31,863,000 as of
December 31, 2004 and $30,079,000 as of December 31,
2003. The measurement date used by the Company's Retirement
Plan was January 1st following each calendar year-end.
The Company's Retirement Plan asset allocations at
December 31, 2004 and December 31, 2003, by asset
category are as follows:
December 31
2004
2003
Asset category
Large cap equity
56.5%
57.7%
International equity
5.3%
5.2%
Bonds
36.5%
35.8%
Cash and cash equivalents
1.7%
1.3%
100.0%
100.0%
F-65
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
The assumed long-term rate of return is based on
weighted-average expected returns for each asset class. The
9.00% assumption compares favorably to the 10-year historical
weighted average compound return of 10.76% actually achieved by
these assets.
The Company believes that the Retirement Plan's risk
posture is, in large part, a function of the asset mix
established for the fund. Based on discussions with its
investment adviser and on its analysis of capital market return
patterns (both historical and expected), the Company considers
the following asset allocation guidelines to be consistent with
the Retirement Plan's risk posture discussed above:
Percent of Total Retirement Plan
Assets
Minimum
Target
Maximum
Equity:
Large cap equity
52
%
55
%
60
%
International equity
3
5
8
Total equity
57
%
60
%
65
%
Fixed-income
35
%
40
%
43
%
Cash equivalents
0
%
<1
%
5
%
The following benefit payments, which reflects expected future
service, as appropriate, are expected to be paid for the
calendar years as follows:
2005
$1,288,000
2006
1,397,000
2007
1,493,000
2008
1,592,000
2009
1,724,000
2010-2014
10,650,000
In addition to the defined benefit pension plan, for most of
2003, the Company provided certain health care and life
insurance benefits for eligible employees who retired from
active service. The post-retirement health care plan was
contributory, with retiree contributions consisting of
co-payment of premiums and other cost sharing features such as
deductibles and coinsurance. Beginning in 1998, the Company
"capped" the amount of premiums that it contributed to
the medical plans. As costs exceed this cap, retiree premiums
increase to cover the additional cost. In 2002, the
Company's post-retirement health care plan was amended to
exclude medical coverage for non-union participants ages 65 and
over. Effective August 1, 2003, the Company eliminated its
subsidy for all medical coverage for retirees. The effect of
this curtailment was a reduction in the accumulated benefit
obligation, a reduction in the accrued benefit liability and a
curtailment gain recorded on the books of Crown. Any curtailment
gain applicable to the Company is included in Cost of sales and
operating expenses in the Statements of Operations. As of August
1, 2003, retirees were offered medical coverage but only on a
fully retiree-paid basis. Therefore, no post-retirement benefit
obligation is recognized in the Company's financial
statements.
6.
Litigation and Contingencies
The Company has been named as a defendant in various matters of
litigation, some of which are for substantial amounts, and
involve alleged personal injury and property damage from
prolonged exposure to asbestos, silica, petroleum, petroleum
related products, including MTBE, and substances used at its
refinery or in the petroleum refining process. The Company is a
co-defendant with numerous other defendants in a number of these
suits. The Company is vigorously defending these actions;
however, the process of resolving these matters could take
several years. The liability, if any, associated with these
cases was either accrued in
F-66
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
accordance with generally accepted accounting principles or was
not determinable at December 31, 2004. The Company has consulted
with counsel with respect to each such proceeding or large claim
which is pending or threatened. While litigation can contain a
high degree of uncertainty and the risk of an unfavorable
outcome, the eventual outcome of any such matter or group of
related matters, in the opinion of management, is not expected
to have a material adverse effect on the Company.
Like other petroleum refiners, the Company's operations are
subject to extensive and rapidly changing federal and state
environmental regulations governing air emissions, wastewater
discharges, and solid and hazardous waste management activities.
The Company's policy is to accrue environmental and
clean-up related costs of a non-capital nature when it is both
probable that a liability has been incurred and that the amount
can be reasonably estimated. While it is often extremely
difficult to reasonably quantify the liability for future
environmental expenditures, the Company anticipates that
expenditures will be required over the next several years to
comply with existing regulations. The Company has recorded a
liability of $1.2 million and $1.4 million as of
December 31, 2004 and 2003, respectively, to cover the
estimated costs of compliance with environmental regulations
required at an operating refinery that are not anticipated to be
of a capital nature. The liability is not discounted.
The Company is under various requirements of the Texas
Commission on Environmental Quality (TCEQ) as defined by certain
pleadings, orders and permits issued by that agency. As of
December 31, 2004 and the date of the sale of the Company
(April 29, 2005), the Company had known but inestimable
remediation efforts at the Tyler Refinery associated with an
existing groundwater and other remediation efforts.
In December 2004 and January 2005, the Company and the
U.S. Department of Justice (DOJ) exchanged correspondence
concerning alleged environmental violations at the Tyler
Refinery. The Company outlined several steps that it was
prepared to take to address the alleged violations and to
prevent future violations. At a meeting in January 2005, the
Company met with representatives of DOJ to discuss the
Company's proposed compliance plan. The Company expects to
negotiate a consent decree with the DOJ that will incorporate an
agreed compliance plan. Any such consent decree is expected to
include a provision requiring the Company to pay a fine and/or
penalty. Under the terms of the sale of the Tyler Refinery, the
Tyler Refinery buyer will be responsible for assuring future
compliance with any ongoing provisions of the consent decree,
while La Gloria will remain responsible for the payment of
any fines or penalties for environmental violations prior to the
sale. Currently, the Company cannot estimate the amount of any
potential fine or penalty that may be imposed and as such has
not accrued any liability associated with the potential fine or
penalty. La Gloria does not believe that any such fines or
penalties will be material, but can make no assurances since it
has not completed the negotiation of the consent decree.
Environment liabilities are subject to considerable
uncertainties that affect the Company's ability to estimate
its ultimate cost of remediation efforts. These uncertainties
include the exact nature and extent of the contamination at each
site, the extent of required clean-up efforts, varying costs of
alternative remediation strategies, changes in environmental
remediation requirements, the number and strength of other
potentially responsible parties at multi-party sites, and the
identification of new environmental sites.
It is possible that the ultimate cost of future environmental
compliance, which cannot be determined at this time, could
exceed the Company's recorded liability. As a result,
charges to income for environmental liabilities could have a
material effect on the results of operations in a particular
quarter or year as assessments and remediation efforts proceed
or as new claims arise. In addition, the Company has been named
by the Environmental Protection Agency and by several state
environmental agencies as a potentially responsible party at
various federal and state Superfund sites. Management is not
aware of any environmental
F-67
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
matters that, in the ordinary course of business, would
reasonably be expected to have a material adverse effect on the
Company.
7.
Noncancellable Lease Commitments
The Company has noncancellable operating lease commitments for
refinery equipment, office and other equipment, transportation
equipment, and office space. Lease terms range from one to four
years for refinery, office and other equipment and
month-to-month for transportation equipment. Certain of these
leases have renewal provisions.
Future minimum rental payments under noncancellable operating
lease agreements as of December 31, 2004 are as follows (in
thousands):
Operating
Leases
2005
$47
2006
37
2007
25
2008
5
2009
—
After 2009
—
Total minimum rental payments
$114
Rental expense for the years ended December 31, 2004, 2003,
and 2002 was $947,081, $930,276, and $1,005,593, respectively.
8.
Fair Value of Financial Instruments
The Company considers cash and cash equivalents, accounts
receivable, futures, forwards, swaps, and accounts payable to be
its financial instruments. The carrying amount reported in the
balance sheet for cash and cash equivalents, accounts
receivable, futures, forwards, swaps, and accounts payable
represent their fair values.
9.
Income Taxes
Significant components of the Company's deferred tax
liabilities and assets are as follows:
December 31
2004
2003
(Thousand of dollars)
Deferred tax liabilities:
Depreciation and amortization
$(1,801
)
$(8,929
)
Post-retirement and pension obligations
(753
)
(432
)
Other
(942
)
(1,255
)
Total deferred tax liabilities
(3,496
)
(10,616
)
Deferred tax assets:
Construction and inventory costs not currently deductible
7,933
5,199
Environmental, litigation and other accruals
859
1,244
Other
511
496
Total deferred tax assets
9,303
6,939
Net deferred tax asset (liability)
$5,807
$(3,677
)
F-68
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
Deferred income taxes are included in the Combined Balance Sheet
in Current deferred tax assets and deferred income taxes.
Significant components of the income tax provision for the years
ended December 31 are as follows:
2004
2003
2002
(Thousands of dollars)
Current:
Federal
$14,706
$3,628
$4,435
State franchise and income taxes
1,300
320
392
Total current
16,006
3,948
4,827
Deferred:
Federal
(8,307
)
(893
)
(2,060
)
State franchise and income taxes
(712
)
(76
)
(177
)
Total deferred
(9,019
)
(969
)
(2,237
)
Income tax expense
$6,987
$2,979
$2,590
A reconciliation of income taxes at the U.S. federal
statutory income tax rate and the Company's effective tax
rate is as follows:
2004
2003
2002
Statutory U.S. Federal income tax rate
35
%
35
%
35
%
Effect of state income taxes
3
%
3
%
3
%
Other
(3
)%
(1
)%
(2
)%
35
%
37
%
36
%
10.
Subsequent Events
Crown's Asset
Divestment Plan
In January 2003, Crown engaged the firm of Park Avenue Equity
Management, LLC (Park Avenue), to assist in the marketing for
sale Crown or all of its assets. A partner of Park Avenue is
also a director of Rosemore, Inc. Since January 2003, Crown has
completed several asset dispositions and has entered into
agreements to dispose of others. All of the purchasers to whom
these assets have been sold, or agreed to be sold, were
unrelated to Crown, including the March 2005 agreement to sell
the Company.
As of December 31, 2004, Crown has sold all of its
operating retail sites and most of its product terminals. Since
Crown began its divestment process in early 2003,
339 active and idle retail sites and nine product terminals
were sold, resulting in net proceeds of approximately
$148.2 million, which reflects expenses related to the
asset sales and certain payments to close out related
sale-leaseback transactions. The sales of such assets are not
reflected in the accompanying Company financial statements as
these sales are unrelated to the Company's operations
presented herein.
On March 14, 2005, La Gloria executed a Purchase and Sale
Agreement for the sale of the Company (the Tyler Refinery and
McMurrey Pipeline assets). Under the terms of the agreement, the
buyer will offer to employ most of the employees at the
facilities and will recognize the unions by whom certain of the
Company's employees at the Tyler Refinery are represented.
La Gloria completed the sale of the Company on April 29,
2005 for $16.6 million plus the value of the remaining
inventory.
F-69
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
Repayment of Outstanding Obligations under the
    10
7
/
8
%
    Senior Note Indenture
Simultaneous with the sale of the Pasadena Refinery, Crown
arranged for the full satisfaction of all of its outstanding
obligations on its
10
7
/
8
% Senior
Notes due February 1, 2005. Payment was made to the Trustee
under the Note Indenture and all noteholders were paid principal
and interest in full on the maturity date.
11.
Related Party Transactions
The Company has related party transactions with its parent and
affiliates whose operating results are not part of the
Company's financial statements. Transactions and balances
with such affiliated entities are considered to be related party
(affiliate) transactions and balances. Such sales and related
cost of sales were approximately $135.2 million and
$131.9 million in 2004, $320.6 million and
$321.6 million in 2003, and $297.2 million and
$269.9 million in 2002. Amounts due to the Company related
to such sales are reflected in the "net transactions with
owner" in the Statement of Changes in Owner's Net
Investment.
The parent provides services to the Company including corporate
senior management, human resources, legal, accounting and
information system support. Fees charged for these services are
based on allocation factors deemed appropriate by management as
described in Note 1. Allocated administrative fees are a
component of Cost of Sales and Operating Expenses and for the
years ended December 31, 2004, 2003, and 2002 were
$3.5 million, $3.6 million, and $3.8 million,
respectively. Amounts due Crown related to these services are
reflected in the "net transactions with owner" in the
Statement of Changes in Owner's Net Investment.
F-70
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO COMBINED FINANCIAL STATEMENTS —
(Continued)
Year Ended December 31, 2004
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
CONDENSED COMBINED BALANCE SHEETS
(Thousands of dollars)
March 31
December 31
2005
2004
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents
$—
$ —
Accounts receivable, less allowance for doubtful accounts
    (2005 — $1,189; 2004 — $1,148)
87,212
86,055
Inventories, net of LIFO reserves (2005 — $34,427;
    2004 — $21,183)
28,357
30,945
Prepaid crude inventory
21,050
53,279
Other current assets
7,883
6,489
Current deferred tax assets
8,584
8,361
Total current assets
153,086
185,129
Deferred turnaround
6,772
1,024
Property, plant and equipment
Land
313
313
Petroleum refineries
25,492
23,826
Marketing facilities
994
994
Furniture and other equipment
2,326
2,326
29,125
27,459
Less allowance for depreciation
10,463
10,220
Net property, plant and equipment
18,662
17,239
Total assets
$178,520
$203,392
LIABILITIES AND OWNER'S NET INVESTMENT
Current liabilities
Accounts payable:
Crude oil and refined products
$78,634
$57,294
Other
10,377
5,111
Accrued liabilities
14,524
14,607
Total current liabilities
103,535
77,012
Deferred income taxes
2,554
2,554
Other deferred liabilities
8,174
8,174
Total owner's net investment
64,257
115,652
Total liabilities and owner's net investment
$178,520
$203,392
See accompanying notes.
F-71
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
CONDENSED COMBINED STATEMENTS OF OPERATIONS
(Thousands of dollars)
Three Months Ended
March 31
2005
2004
(Unaudited)
Revenues
Sales and operating revenues
$195,560
$109,764
Sales to affiliated party
—
71,051
Total sales
195,560
180,815
Operating costs and expenses
Costs of sales and operating expenses
202,129
97,734
Cost of sales to affiliated party
—
69,505
Selling and administrative expenses
636
1,124
Depreciation and amortization
729
1,512
(Gain) on sales and abandonments of property and equipment
—
(95
)
203,494
169,780
Operating (loss)/income
(7,934
)
11,035
Interest and other income, net
495
323
(Loss)/income before tax
(7,439
)
11,358
Income tax expense
(2,827
)
3,975
Net (loss)/income
$(4,612
)
$7,383
See accompanying notes.
F-72
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
CONDENSED COMBINED STATEMENTS OF CASH FLOWS
(Thousands of dollars)
Three Months Ended
March 31
2005
2004
(Unaudited)
Cash flows from operating activities
Net cash from operations before changes in assets and liabilities
$(4,106
)
$8,988
Net changes in assets and liabilities
58,789
4,773
Net cash provided by operating activities
54,683
13,761
Cash flows from investing activities
Capital expenditures
(1,668
)
(394
)
Proceeds from sales of property and equipment
—
95
Deferred turnaround maintenance
(5,970
)
—
Other changes in deferred assets
(263
)
—
Net cash used in investing activities
(7,901
)
(299
)
Cash flows from financing activities
Net transactions with owner
(46,782
)
13,462
Net cash (used in) provided by financing activities
(46,782
)
13,462
Net increase in cash and cash equivalents
$—
$—
See accompanying notes.
F-73
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL STATEMENTS
(Unaudited)
March 31, 2005
1.
Basis of Presentation
The accompanying financial statements have been prepared from
Crown Central Petroleum Corporation's (Crown) historical
accounting records and represent the combined financial
position, results of operations and cash flows reflecting
assets, liabilities, and operations of the Tyler Refinery and
McMurrey Pipeline operations (the Company). The disclosures in
the notes to the combined financial statements relate solely to
those assets and exclude all other Crown operations. As more
fully described below, the combined financial statements for all
periods presented include allocations of Crown corporate
expenses. For financial reporting purposes, the net intercompany
financing activities of the Company and Crown have been
accumulated into a single caption entitled "owner's
net investment."
The accompanying unaudited condensed combined financial
statements have been prepared in accordance with accounting
principles generally accepted in the United States for interim
financial information and accordingly, they do not include all
of the information and footnotes required by accounting
principles generally accepted in the United States for complete
financial statements. In the opinion of management, all
adjustments, consisting only of normal recurring adjustments,
considered necessary for a fair and comparable presentation have
been included. Operating results for the three months ended
March 31, 2005 are not necessarily indicative of the
results that may be expected for the year ending
December 31, 2005. These financial statements should be
read in conjunction with the combined financial statements and
footnotes thereto of Tyler Refinery and McMurrey Pipeline (a
business component of Crown Central Petroleum Corporation) for
the years ended December 31, 2004, 2003, and 2002 contained
elsewhere in the Delek US
Form
S-1.
The financial statements of the Company are not necessarily
indicative of the financial position, results of operations and
cash flows that might have occurred had the Company not been
integrated into Crown's other operations. Also, they may
not be indicative of the actual financial position that might
have otherwise resulted, or of future results of operations or
financial position of the Company.
The following summarizes the significant accounting policies and
practices followed by the Company:
Use of Estimates
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those
estimates.
Inventories
The Company's crude oil and refined products are valued at
the lower of cost
(last-in,
first-out) or
market. Materials and supplies inventories are valued at cost.
Incomplete exchanges of crude oil and refined products due the
Company or owing to other companies are reflected in the
inventory accounts. Prepaid crude inventory represents advance
payments for future crude deliveries and is valued at the lower
of cost (on a
first-in,
first-out basis) or market and is not considered in the
last-in,
first-out
basis until the crude is physically received by the Company.
An actual valuation of inventory under the LIFO method can be
made only at the end of each year based on the inventory levels
and costs at that time. Accordingly, interim LIFO projections
are based on Management's estimates of expected year-end
inventory levels and current inventory values.
F-74
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS — (Continued)
(Unaudited)
March 31, 2005
Other Current Assets
Other current assets includes a $6.1 million refundable
deposit with an insurance carrier. As discussed further in
Note 8, subsequent to the quarter ended March 31,
2005, La Gloria executed a purchase and sale agreement for
the sale of the Company (the Tyler Refinery and McMurrey
Pipeline assets) and Crown collected the refundable deposit.
Asset Retirement Obligations
Effective January 1, 2003, the Company adopted the
provisions of Statement of Financial Accounting Standards
No. 143,
Accounting for Asset Retirement Obligations
(SFAS No. 143). This statement significantly
changed the method of accruing costs that an entity is legally
obligated to incur associated with the retirement of fixed
assets. Under SFAS No. 143, the fair value of a
liability for an asset retirement obligation is recognized in
the period in which it is incurred if a reasonable estimate of
fair value can be made.
The Company has legal asset retirement obligations for several
assets, including its refinery and pipeline, for which it is not
possible to estimate when the obligations will be settled.
Consequently, the retirement obligations for these assets cannot
be measured at this time.
Owner's Net Investment
Owner's net investment consists of Crown's initial
investment in the Company and subsequent changes in Crown's
net investment resulting from the use of centralized cash
management accounts. Substantially all payments from the
Company's customers are received by Crown and substantially
all expenses and fixed asset additions of the Company are paid
by Crown. In addition, Crown allocates corporate general and
administrative expenses to the Company based on an analysis of
the components of Crown's corporate general and
administrative expenses and the estimated percentage of each
component attributable to the Company. Corporate general and
administrative expense consists principally of corporate
compensation expense. Management believes that the method used
to allocate these expenses is reasonable. Allocated indirect
overhead costs consist principally of the following:
•
Corporate human resources
•
Finance, accounting, legal and administration;
•
Information technology management services.
No interest expense incurred by Crown for general corporate debt
has been allocated to the Company.
Interest and Other Income, Net
Interest and other income, net, primarily consists of
intercompany interest charged by the Company on net amounts due
to the Company from its parent, Crown. Amounts due the Company
from Crown, including interest, are classified as Owner's
Net Investment.
Recent Adoption
In November 2004, the FASB issued Statement of Financial
Accounting Standards No. 151,
Inventory Costs
(FASB
151). The Company is required to adopt the provisions of FASB
151, on a prospective basis, as of January 1, 2006. FASB
151 clarifies the accounting for abnormal amounts of idle
facility expense, freight, handling costs, and wasted material.
FASB 151 requires that those items — if
abnormal — be recognized as
F-75
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS — (Continued)
(Unaudited)
March 31, 2005
expenses in the period incurred. In addition, FASB 151 requires
the allocation of fixed production overheads to the costs of
conversions based upon the normal capacity of the production
facilities. The Company has not yet determined what effect FASB
151 will have on its earnings and financial position.
In March 2005, the FASB issued FASB Interpretation No. 47,
Accounting for Conditional Asset Retirement Obligations
(FASB Interpretation No. 47), which is an
interpretation of SFAS No. 143. This interpretation is
effective no later than the end of fiscal years ending after
December 15, 2005 and clarifies terminology within
FAS 143 and requires companies to recognize a liability for
the fair value of a conditional asset retirement obligation when
incurred if the liability's fair value can be reasonably
estimated. The impact of the adoption of FASB Interpretation
No. 47 on the Company's financial statements has not
yet been determined.
2.
Supplementary Cash Flow Information
Net changes in assets and liabilities presented in the Unaudited
Condensed Combined Statements of Cash Flows are comprised of the
following:
Three Months Ended
March 31
2005
2004
(Thousands of dollars)
Increase in accounts receivable
$(1,157
)
$(10,712
)
Decrease in inventories
2,588
55
Decrease in prepaid crude oil inventory
32,229
—
Increase in other current assets
(1,394
)
(406
)
Increase in crude oil and refined products payable
21,340
11,835
Increase in other accounts payable
5,266
1,677
(Decrease)/ Increase in accrued liabilities and other deferred
    liabilities
(83
)
2,324
$58,789
$4,773
3.
Inventories
Inventories consisted of the following:
March 31
December 31
2005
2004
(Thousands of dollars)
Crude oil
$28,912
$26,361
Refined products
33,257
25,240
Total inventories at FIFO (approximates current cost)
62,169
51,601
LIFO reserve
(34,427
)
(21,183
)
Total crude oil and refined products
27,742
30,418
Materials and supplies inventory at FIFO
615
527
Total inventory
$28,357
$30,945
F-76
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS — (Continued)
(Unaudited)
March 31, 2005
As a result of a deemed permanent reduction in LIFO inventory
quantities, the LIFO reserve related to crude oil and refined
products and costs and operating expenses for the three months
ended March 31, 2005 and 2004 were reduced by approximately
$2.5 million and $6.2 million, respectively.
4.
Credit Arrangements
Crown maintains a Loan and Security Agreement, as amended
(Secured Credit Facility), which is used to provide cash
borrowings and letters of credit for general corporate and
working capital requirements which was extended until
January 24, 2005. The Secured Credit Facility, which is
collateralized by virtually all assets, includes limitations on
additional indebtedness and cash dividends. Effective
December 31, 2003, Crown was no longer required to comply
with financial covenants requiring the maintenance of minimum
levels of adjusted working capital, net worth and cash flow.
Crown pays a fee for unused commitments. Cash borrowings under
the Secured Credit Facility are limited to $50 million and
bear interest based on the prime rate. There is no such
sub-limit for the issuance of letters of credit.
At March 31, 2005, the total commitments within the Secured
Credit Facility were approximately $110 million, with
$40 million provided by bank participants and
$70 million from Rosemore, a related party to the Company.
The bank commitments are subject to the availability of eligible
collateral, which totaled $53.1 million at March 31,
2005, after the application of reserves. The remaining
availability, which is provided by Rosemore, is not subject to
the limitation of eligible collateral. As of March 31,
2005, the Company had cash borrowings of $25.5 million and
$70.1 million of outstanding letters of credit issued
pursuant to the Secured Credit Facility, with remaining unused
commitments of $14.4 million. Cash borrowings and
outstanding letters of credit at March 31, 2004, were
$25.2 million and $71.6 million, respectively. Letters
of Credit directly attributable to the Company operations were
$65.5 million at March 31, 2005 and $58.2 million
at March 31, 2004.
The Secured Credit Facility was amended as of January 25,
2005, with the bank participation adjusted to $40 million
and Rosemore participations adjusted to $70 million for a
total commitment of $110 million. The total bank
commitments are collateralized with 85% of eligible accounts
receivables plus the lesser of, 60% of the value of eligible
inventories or $25 million for a combined maximum of
$40 million. The remaining availability, which is provided
by Rosemore, is not subject to the limitation of eligible
collateral. The maturity date of the facility is defined as the
earlier of December 31, 2005 or the date of closing on the
sale of the Tyler Refinery. No contractual reductions of the
Rosemore participation are provided or contemplated. Fees and
expenses related to the issuances of letters of credit are
included in cost of the materials purchased.
5.
Derivatives and Hedging Activities
The Company uses futures, forwards and swaps to manage the price
risk inherent in purchasing crude oil in advance of the delivery
date, and in maintaining the value of inventories contained
within its refinery and pipeline system. The Company's risk
management policy sets forth the hedging strategies used to
manage the price risks. The strategies include fixing a future
margin between crude oil and certain finished products, and also
hedging fixed price purchase and sale commitments of crude oil
and refined products. These instruments generally allow for
settlement at the end of their term in either cash or product.
In accordance with SFAS No. 133,
Accounting for
Derivative Instruments and Hedging Activities
, the Company
recognizes all derivatives as either assets or liabilities in
the balance sheet and those instruments are measured at fair
value. Certain derivatives, which are transacted pursuant to the
Company's risk management policy to manage price risk, do
not qualify or at the Company's discretion, are not
designated as hedges
F-77
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS — (Continued)
(Unaudited)
March 31, 2005
under Statement No. 133. These contracts are accounted for
on the
mark-to
-market
basis of accounting and as such changes in the fair value of the
derivatives are recorded each period in earnings.
As of March 31, 2005 and December 31, 2004, the
Company had recorded derivatives in its other current assets and
crude oil and refined products payable from operations at the
Tyler Refinery of $1.5 million and $2.0 million,
respectively. For the three months ended March 31, 2005,
the Company recorded expenses of $4.3 million representing
the change in the fair value of the Company's derivative
financial instruments and hedging activities used to hedge
inventory costs. For the three months ended March 31, 2004,
the Company recorded income of $0.1 million representing
the change in the fair value of the Company's derivative
financial instruments and hedging activities used to hedge
inventory costs. These amounts were recorded in costs and
operating expenses in the Condensed Combined Statements of
Operations. As of March 31, 2005 and December 31,
2004, the Company had no derivative financial instruments
designated as hedges.
The Company has fixed price firm purchase and sale commitments
for crude and related products that meet the requirements to be
designated as normal purchases or sales transactions and
therefore are not subject to the requirements of
SFAS No. 133. The Company specifically designates each
firm commitment as a normal purchase or normal sale upon
execution. No unrealized gains are recognized on firm
commitments designated as normal purchases or normal sales. The
Company evaluates these contracts for
lower-of
-cost-or-market
and where necessary, provides an allowance to write-down to
market.
6.
Litigation and Contingencies
The Company has been named as a defendant in various matters of
litigation, some of which are for substantial amounts, and
involve alleged personal injury and property damage from
prolonged exposure to asbestos, silica, petroleum, petroleum
related products, including MTBE, and substances used at its
refinery or in the petroleum refining process. The Company is a
co-defendant with numerous other defendants in a number of these
suits. The Company is vigorously defending these actions;
however, the process of resolving these matters could take
several years. The liability if any, associated with these cases
was either accrued in accordance with generally accepted
accounting principles or was not determinable at March 31,
2005. The Company has consulted with counsel with respect to
each such proceeding or large claim which is pending or
threatened. While litigation can contain a high degree of
uncertainty and the risk of an unfavorable outcome, the eventual
outcome of any such matter or group of related matters, in the
opinion of management, is not expected to have a material
adverse effect on the Company.
Like other petroleum refiners, the Company's operations are
subject to extensive and rapidly changing federal and state
environmental regulations governing air emissions, wastewater
discharges, and solid and hazardous waste management activities.
The Company's policy is to accrue environmental and
clean-up
related costs
of a non-capital nature when it is both probable that a
liability has been incurred and that the amount can be
reasonably estimated. While it is often extremely difficult to
reasonably quantify the liability for future environmental
expenditures, the Company anticipates that expenditures will be
required over the next several years to comply with existing
regulations. The Company has recorded a liability of
$1.2 million as of March 31, 2005 and
December 31, 2004, respectively, to cover the estimated
costs of compliance with environmental regulations required as
an operating refinery that are not anticipated to be of a
capital nature. The liability is not discounted.
The Company is under various requirements of the Texas
Commission on Environmental Quality (TCEQ) as defined by
certain pleadings, orders and permits issued by that agency. As
of March 31, 2005 and
F-78
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS — (Continued)
(Unaudited)
March 31, 2005
the date of the sale of the Company (April 29, 2005), the
Company had known but inestimable remediation efforts at the
Tyler facility associated with an existing groundwater and other
remediation efforts.
In December 2004 and January 2005, the Company and the
U.S. Department of Justice (DOJ) exchanged
correspondence concerning alleged environmental violations at
the Tyler Refinery. The Company outlined several steps that it
was prepared to take to address the alleged violations and to
prevent future violations. At a meeting in January 2005, the
Company met with representatives of DOJ to discuss the
Company's proposed compliance plan. The Company expects to
negotiate a consent decree with the DOJ that will incorporate an
agreed compliance plan. Any such consent decree is expected to
include a provision requiring the Company to pay a fine and/or
penalty. Under the terms of the sale of the Tyler Refinery, the
Refinery buyer will be responsible for assuring future
compliance with any ongoing provisions of the consent decree,
while La Gloria will remain responsible for the payment of
any fines or penalties for environmental violations prior to the
sale. Currently, the Company cannot estimate the amount of any
potential fine or penalty that may be imposed and as such has
not accrued any liability associated with the potential fine or
penalty. La Gloria does not believe that any such fines or
penalties will be material, but can make no assurances since it
has not completed the negotiation of the consent decree.
Environmental liabilities are subject to considerable
uncertainties that affect the Company's ability to estimate
its ultimate cost of remediation efforts. These uncertainties
include the exact nature and extent of the contamination at each
site, the extent of required
clean-up
efforts,
varying costs of alternative remediation strategies, changes in
environmental remediation requirements, the number and strength
of other potentially responsible parties at multi-party sites,
and the identification of new environmental sites.
It is possible that the ultimate cost of future environmental
compliance, which cannot be determined at this time, could
exceed the Company's recorded liability. As a result,
charges to income for environmental liabilities could have a
material effect on the results of operations in a particular
quarter or year as assessments and remediation efforts proceed
or as new claims arise. In addition, the Company has been named
by the Environmental Protection Agency and by several state
environmental agencies as a potentially responsible party at
various federal and state Superfund sites. Management is not
aware of any environmental matters that, in the ordinary course
of business, would reasonably be expected to have a material
adverse effect on the Company.
7.
Employee Benefit Obligations
The following table presents the components of the
Company's pension expense for the three months ended
March 31, 2005 and 2004:
Three Months
Ended
March 31
2005
2004
(Thousands
of dollars)
Service cost — benefits earned during the year
$60
$31
Interest cost on projected benefit obligations
473
464
Expected return on plan assets
(563
)
(497
)
Amortization of prior service cost
(1
)
(1
)
Amortization of net actuarial loss
83
52
Net periodic pension cost
$52
$49
F-79
Table of Contents
TYLER REFINERY AND MCMURREY PIPELINE
(A Business Component of Crown Central Petroleum
Corporation)
NOTES TO CONDENSED COMBINED FINANCIAL
STATEMENTS — (Continued)
(Unaudited)
March 31, 2005
During the three months ended March 31, 2005, Crown made
contributions to the benefit pension plan of $1.4 million
on behalf of the Company. Total contributions on the
Company's behalf to the pension plan in 2005 are expected
to be approximately $8.3 million.
8.
Subsequent Events
On March 14, 2005, La Gloria executed a Purchase and
Sale Agreement for the sale of the Company (the Tyler Refinery
and McMurrey Pipeline assets). Under the terms of the agreement,
the buyer will offer to employ most of the employees at the
facilities and will recognize the unions by whom certain of the
Company's employees at the Refinery are represented.
La Gloria completed the sale of the Company on
April 29, 2005 for $16.6 million plus the value of the
remaining inventory.
As noted above, subsequent to the quarter ended March 31,
2004, the Company executed a purchase and sale agreement for the
sale of the Company at an amount which indicated the property,
plant and equipment was impaired as of December 31, 2004.
In the fourth quarter of 2004, the Company recognized an
impairment charge of approximately $15.3 million.
9.
Related Party Transactions
The Company has related party transactions with its parent and
affiliates whose operating results are not part of the
Company's financial statements. Transactions and balances
with such affiliated entities are considered to be related party
(affiliate) transactions and balances. Such sales and
related cost of sales were approximately $71.1 million and
$69.5 million for the three months ended March 31,
2004. There were no transactions with such affiliated entities
in 2005. Amounts due to the Company related to such sales are
reflected in the "Total Owner's net investment"
on the Condensed Combined Balance Sheets.
The parent provides services to the Company including corporate
senior management, human resource, legal, accounting and
information system support. Allocated fees charged for these
services are based on an allocation based on factors deemed
appropriate by management as described in Note 1. Allocated
administrative fees are a component of Selling and
administrative expenses and for the three month period ended
March 31, 2005 and 2004 were $0.4 million and
0.9 million, respectively. Amounts due Crown related to
these services are reflected in the "Total Owner's net
investment" on the Condensed Combined Balance Sheets.
F-80
Table of Contents
REPORT OF INDEPENDENT AUDITORS
Stockholder
Williamson Oil Co., Inc.
We have audited the accompanying consolidated balance sheet of
Williamson Oil Co., Inc. and Subsidiaries as of
November 30, 2003, and the related consolidated statements
of operations, stockholder's equity, and cash flows for the
year then ended. These financial statements are the
responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards
generally accepted in the United States. 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 audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Williamson Oil Co., Inc. and Subsidiaries
at November 30, 2003, and the consolidated results of their
operations and their cash flows for the year then ended in
conformity with accounting principles generally accepted in the
United States.
/s/ Ernst & Young LLP
Nashville, Tennessee
March 11, 2004, except for Note 10, as to
which the date is April 30, 2004
F-81
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
November 30, 2003
ASSETS
Current assets:
Cash and cash equivalents
$2,732,562
Accounts receivable trade, net of allowance for doubtful
    accounts of $259,424
1,516,170
Accounts receivable, other
658,254
Inventories
6,802,068
Prepaid expenses
215,741
Current portion of notes receivable — related parties
30,568
11,955,363
Property and equipment:
Land and improvements
8,965,042
Buildings
23,831,906
Machinery and equipment
30,361,226
Automotive equipment
7,952,137
Office equipment
1,275,403
Leasehold improvements
234,006
72,619,720
Less accumulated depreciation and amortization
(33,243,683
)
39,376,037
Other noncurrent assets
156,027
Notes receivable — related parties, net of current
    portion
951,427
Debt issuance costs, less accumulated amortization of $139,125
446,685
Total assets
$52,885,539
LIABILITIES
Current liabilities:
Current maturities of long-term debt
$28,097,547
Line of credit
472,000
Accounts payable
6,068,583
Petroleum and other products taxes payable
2,819,443
Other payables and accrued expenses
1,750,370
Income taxes payable
160,418
Current portion of long-term liabilities
401,180
Total current liabilities
39,769,541
Long-term liabilities:
Long-term debt, less current maturities
6,405,737
Fair value of interest rate swap
198,000
Deferred gain on asset disposal
990,000
Deferred revenues
1,577,303
Total liabilities
48,940,581
Stockholder's equity:
Common stock $10 par value; 301 shares authorized,
    issued and outstanding
3,010
Retained earnings
3,941,948
Total stockholder's equity
3,944,958
Total liabilities and stockholder's equity
$52,885,539
See accompanying notes.
F-82
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended November 30, 2003
Sales
$
214,813,130
Cost of sales
179,996,723
Gross profit
34,816,407
Operating expenses
33,347,510
Income from operations
1,468,897
Other income (expense):
Net gain on sale of assets
764,939
Change in fair value of interest rate swap
464,500
Interest income
105,418
Rental income
404,443
Interest expense
(3,320,199
)
Total other expenses
(1,580,899
)
Loss before income taxes
(112,002
)
Income taxes
—
Net loss
$(112,002
)
See accompanying notes.
F-83
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDER'S EQUITY
Year ended November 30, 2003
Common
Retained
Stock
Earnings
Total
Balance at November 30, 2002
$
3,010
$
4,653,950
$
4,656,960
Dividends paid
—
(600,000
)
(600,000
)
Net loss
—
(112,002
)
(112,002
)
Balance at November 30, 2003
$
3,010
$
3,941,948
$
3,944,958
See accompanying notes.
F-84
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
Year Ended November 30, 2003
Operating activities:
Net loss
$(112,002
)
Adjustments to reconcile net loss to net cash provided by
    operating activities:
Depreciation and amortization
4,545,813
Gain on sale of assets
(764,939
)
Change in fair value of interest rate swap
(464,500
)
Changes in operating assets and liabilities:
Increase in accounts receivable
(116,138
)
Decrease in inventories
253,878
Increase in other assets
(4,237
)
Increase in accounts payable and accrued expenses
1,744,207
Decrease in income taxes payable
(24,877
)
Change in deferred revenues
(317,946
)
Net cash provided by operating activities
4,739,259
Investing activities:
Proceeds from sale of property and equipment
2,734,836
Purchase of property and equipment
(4,291,303
)
Net repayment on notes receivable
244,816
Net cash used in investing activities
(1,311,651
)
Financing activities:
Net payments on line of credit
(55,000
)
Borrowings on long-term debt
1,011,681
Payments on long-term debt
(4,245,858
)
Dividends paid
(600,000
)
Net cash used in financing activities
(3,889,177
)
Net decrease in cash and cash equivalents
(461,569
)
Cash and cash equivalents at beginning of year
3,194,131
Cash and cash equivalents at end of year
$2,732,562
Supplemental disclosure of cash flow information
Cash paid during the year for:
Interest
$2,778,610
Income taxes
$24,877
See accompanying notes.
F-85
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
November 30, 2003
1.
Summary of Significant Accounting Policies
Nature of Business
Williamson Oil Co., Inc. and Subsidiaries (the
"Company") operate a chain of retail convenience
stores selling gasoline, certain grocery items, and other
general merchandise. The Company operates 86 retail convenience
stores in the state of Alabama and one store in the state of
Tennessee.
Consolidation
The consolidated financial statements include Williamson Oil
Co., Inc., and its wholly owned subsidiaries, Liberty Wholesale
Co., Inc., Gasoline Associated Services, Inc., and Jetstream
Aviation, Inc. All significant intercompany transactions and
balances have been eliminated in the consolidated financial
statements. During the year ended November 30, 2003,
Jetstream Aviation, Inc. was merged into the parent company,
Williamson Oil Co., Inc., which merger had no impact on the
consolidated financial statements.
Cash and Cash Equivalents
The Company considers all highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents. The Company maintains accounts in financial
institutions located in Alabama and Georgia. The balances are
insured by the Federal Deposit Insurance Corporation up to
$100,000 per financial institution. At certain times, the
Company's cash balances exceed $100,000 and are uninsured.
Inventories
Inventories consist of gasoline, diesel fuel, other petroleum
products, cigarettes, beer, convenience merchandise and food
service merchandise. Fuel and wholesale inventories are stated
at the lower of cost or market on a
first-in,
first-out
("FIFO") basis; other non-fuel inventories are stated
at estimated cost as determined by the retail inventory method.
Property and Equipment
Acquisitions of property and equipment are carried at cost.
Betterments, renewals and extraordinary repairs that extend the
life of the asset are capitalized; other maintenance and repairs
are charged to expense as incurred. The Company owns certain
fixed assets on leased locations and depreciates these assets
and asset improvements over the lesser of management's
estimated useful lives of the asset or the remaining lease term.
Depreciation is computed using the straight-line method or
accelerated methods over management's estimated useful
lives of the related assets, which are as follows:
Land improvements
15-20  years
Buildings
20 years
Machinery and equipment
5-7 years
Automotive equipment
5 years
Office equipment
5-7 years
Depreciation and amortization expense for the year ended
November 30, 2003 was $4,545,813.
In accordance with Statement of Financial Accounting Standards
("SFAS") No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," the Company
evaluates the realizability of property and equipment as events
occur that could indicate impairment using measurements such as
projected undiscounted operating cash flows from the respective
asset.
F-86
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
On February 20, 2001 and August 27, 1999, the Company
sold and subsequently leased back two convenience stores to
officers of the Company. Under the terms of the sale agreement,
the Company has the option to purchase the leased property with
fifteen days advance written notice of its election to the
landlord. The Company also guarantees the notes held by the
officers for these facilities. Due to the continuing involvement
in these stores, as defined by SFAS No. 66,
"Accounting for Sales of Real Estate", the Company
accounts for these transactions under the financing method.
Consistent with the financing method, the Company continues to
report the related notes payable and property balances of these
stores in its financial statements. One of the notes has an
interest rate of 8.25% and monthly principal payments of $11,111
through August 26, 2004. The other note has an interest
rate of LIBOR plus 2.50% and monthly principal payments of
$9,916 through February 15, 2011.
Income Taxes
Income taxes are accounted for under the provisions of
SFAS No. 109, "Accounting for Income Taxes."
This statement generally requires the Company to record deferred
income taxes for the differences between the book and tax bases
of its assets and liabilities, which are measured using enacted
tax rates and laws that will be in effect when the differences
are expected to reverse. Deferred income tax expense or benefit
represents the net change during the year in the Company's
deferred income tax assets and liabilities.
Revenue Recognition
The Company recognizes revenue as its products are sold to
customers.
Accounts Receivable Trade
The Company reports trade receivables at estimated net
realizable value. Management determines the allowance for
doubtful accounts based on historical losses and current
economic conditions. On a continuing basis, management analyzes
delinquent receivables, and once these receivables are
determined to be uncollectible, they are written off through a
charge against an existing allowance account or against earnings.
Vendor Discounts and Deferred Revenue
The Company receives cash discounts or cash payments from
certain vendors related to product promotions based upon factors
such as quantities purchased, quantities sold, merchandise
exclusivity, store space, etc. The Company recognizes these
amounts as a reduction of cost of goods sold at the time the
discount is earned. Certain of these amounts are received from
vendors related to agreements covering several periods. These
amounts are initially recorded as deferred revenue upon receipt
and subsequently recognized as a reduction of cost of goods sold
as earned.
Fair Value of Financial Instruments
The fair values of financial instruments are estimated based
upon current market conditions and quoted market prices for the
same or similar instruments as of November 30, 2003.
Management estimates that book value approximates fair value for
all of the Company's assets and liabilities that fall under
the scope of SFAS No. 107, "Disclosures about
Fair Value of Financial Instruments."
Use of Estimates
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements
F-87
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those
estimates.
Debt Issuance Costs
The Company capitalizes certain direct costs associated with the
issuance of new debt when paid. These costs are then amortized
on the straight-line basis over the term of the related debt,
which is not significantly different from the interest method.
Comprehensive Income
Statement of Financial Accounting Standards No. 130,
Reporting Comprehensive Income,
(SFAS 130), requires
that total comprehensive income be reported in the financial
statements. Total comprehensive loss is equal to net loss for
the year ended November 30, 2003.
Recent Accounting Pronouncements
In November 2002, the EITF reached a consensus on
EITF
02-16,
which
addresses the accounting and income statement classification for
consideration given by a vendor to a retailer in connection with
the sale of the vendor's products or for the promotion of
sales of the vendor's products. The EITF concluded that
such consideration received from vendors should be reflected as
a decrease in prices paid for inventory and recognized in cost
of sales as the related inventory is sold, unless specific
criteria are met qualifying the consideration for treatment as
reimbursement of specific, identifiable incremental costs. As
clarified by the EITF in January 2003, this issue was effective
for arrangements with vendors initiated on or after
January 1, 2003. The provisions of this consensus are
consistent with the Company's existing accounting policy.
Accordingly, the adoption of
EITF
02-16
did not
have a material impact on the Company's financial
statements as a whole.
In January 2003, FASB issued Interpretation No. 46,
Consolidation of Variable Interest Entities, an Interpretation
of ARB No. 51 ("FIN 46"). FIN 46
requires certain variable interest entities to be consolidated
by the primary beneficiary of the entity if the equity investors
in the entity do not have the characteristics of a controlling
financial interest or do not have sufficient equity interest at
risk for the entity to finance its activities without additional
subordinated financial support from other parties. FIN 46
is effective for all new variable interest entities created or
acquired after December 31, 2003. For variable interest
entities created or acquired prior to January 1, 2004, the
provisions of FIN 46 must be applied for the first interim
or annual period after December 15, 2004. As a result,
FIN 46 does not have an effect on the Company in the
current year. The Company has not yet determined whether
FIN 46 will have a significant impact on its financial
statements in the future.
2.
Inventories
The components of inventories were as follows as of
November 30, 2003:
Gasoline and diesel inventories
$
1,316,423
Grocery inventories
4,741,429
Other inventories
744,216
Total inventories
$
6,802,068
F-88
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
3.
Notes Receivable — Related Parties
Notes receivable from related parties consisted of the following
at November 30, 2003:
Chief executive officer
$817,496
Other related parties (primarily employees and family of the
    chief executive officer)
164,499
981,995
Due within one year
30,568
Due after one year
$951,427
Repayment terms and conditions vary depending upon the nature of
the loans.
4.
Long-Term Debt
Debt and obligations under capital leases at November 30,
2003 consisted of the following:
Term loan, with monthly principal payments of $170,579 through
    March 1, 2019; interest payable monthly at 8.15%
$17,102,196
Term loans, with various monthly principal payments maturing
    2007-2011 with interest rates of 6.00% or 6.75%
9,645,659
Promissory note, with monthly principal payments of $33,992
    through July 30, 2008; interest payable monthly at 7.50%
3,295,050
Promissory note, with variable monthly principal payments
    through July 30, 2008; interest payable monthly at LIBOR
    plus 2.37%
1,330,625
Notes payable of officers of the Company (see Note 1)
1,513,516
Other
301,043
33,188,089
Obligations under capital leases (see Note 5)
1,315,195
34,503,284
Less amounts due within one year
28,097,547
Amounts due after one year
$6,405,737
The Company's debt is collateralized by substantially all
of the Company's real estate and equipment.
The provisions of the term loans described above require the
Company to maintain certain financial covenants including
minimum tangible stockholder's equity, maximum total
liabilities to tangible stockholder's equity, cash flow to
current maturities and a maximum amount of notes payable to the
stockholder, related parties, and others, as defined by the term
loan agreements. As of November 30, 2003, the Company
F-89
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
was in violation of certain of these covenants. As a result, the
outstanding balances of the term loans have been classified as
current in the Company's financial statements.
Maturities of long-term debt are as follows:
2004
$
27,493,043
2005
756,894
2006
776,630
2007
797,883
2008
2,989,826
Thereafter
373,813
$
33,188,089
Line of Credit
The Company has a $2,000,000 revolving line of credit with
Compass Bank, which expires October 1, 2004. The interest
rate is based on the London Interbank Offered Rate
("LIBOR") plus 3% with a minimum rate of 6.75% and a
maximum rate of 18.00%. At November 30, 2003, the balance
on the line of credit was $472,000. The majority stockholder of
the Company has personally guaranteed this line of credit.
Derivative Instruments
On April 2, 1997, the Company entered into an interest rate
swap agreement, which fixed the interest rate on $10,000,000 of
notional principal amount at 9.65% through April 4, 2004.
This agreement was intended to economically hedge floating rate
debt relating to the various debt instruments, as discussed
above. However, as the Company elected to not comply with the
requirements, including formal hedge designation and
documentation, to apply hedge accounting treatment in accordance
with the provisions of SFAS No. 133, "Accounting
for Derivative Instruments and Hedging Activities," the
Company records the fair value of the derivative in the balance
sheet with the change in the fair value recorded into earnings.
See Note 9 for discussion of related litigation.
5.
Capital Lease Obligations
The Company leases certain equipment under capital leases. The
economic substance of the leases is that the Company is
financing the acquisition of the assets through the lease and,
accordingly, they are recorded in the Company's assets and
liabilities at the lesser of the present value of the minimum
lease payments or the fair value of the assets. The assets are
amortized over their estimated useful lives through depreciation
expense. Generally, assets under capital leases are purchased at
the end of the lease term.
The following is an analysis of the leased assets included in
property and equipment at November 30, 2003:
Machinery and equipment
$
3,335,189
Less accumulated depreciation
2,232,119
$
1,103,070
F-90
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
Future minimum rentals for leased property under capital leases
are as follows at November 30, 2003:
2004
$686,830
2005
488,756
2006
281,330
2007
37,619
Total minimum lease payments
1,494,535
Less amount representing interest
179,340
$1,315,195
Interest rates on capital lease obligations range from 9.0% to
11.5% and are imputed based on the lower of the Company's
incremental borrowing rate at the inception of each lease or the
lessor's implicit rate of return.
6.
Operating Leases
In conducting a part of their operations, the Company has
commitments under various operating leases for service stations
and equipment. Some of the operating leases contain renewal
options for various periods. Rental payments required during
renewal periods are not materially different. Rent charged to
operations totaled $2,250,184 for the year ended
November 30, 2003.
Future minimum rental payments required under operating leases
that have initial or remaining noncancelable lease terms in
excess of one year are as follows for the next five fiscal years
ending November 30:
2004
$1,521,570
2005
1,446,741
2006
1,368,366
2007
1,309,491
2008
1,056,268
Thereafter
3,606,688
Total minimum lease payments
$10,309,124
F-91
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
7.
Income Taxes
Income taxes for the year ended November 30, 2003 are
comprised of the following components:
Current
Federal
$—
State
—
—
Deferred Benefit (Provision)
Federal
22,672
State
2,886
Change in valuation allowance
(25,558
)
—
$—
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts
used for income tax purposes. Significant components of the
Company's deferred tax assets and liabilities as of
November 30, 2003 are as follows:
Current Deferred Taxes:
Allowance for doubtful accounts
$26,350
Vacation accrual
35,805
Other
33,560
Less valuation allowance
(95,715
)
Total current deferred tax assets
—
Noncurrent Deferred Taxes:
Depreciation/amortization
(2,653,936
)
Net operating loss carry forwards
2,058,849
Deferred gain on sale of assets
341,000
Fair value of interest rate swap
61,380
Deferred revenue
579,230
Other
15,008
Less valuation allowance
(401,531
)
Total noncurrent deferred tax assets
—
$—
Realization of future tax benefits related to deferred tax
assets is dependent on many factors, including the
Company's ability to generate taxable income within the net
operating loss carryforward period. Management has considered
these factors in assessing the valuation allowance for financial
reporting purposes. In accordance with SFAS 109, the
Company has provided a valuation allowance to reserve the
deferred tax assets.
F-92
Table of Contents
WILLIAMSON OIL CO., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)
November 30, 2003
As of November 30, 2003, the Company had consolidated
federal net operating loss carryfowards of $6,240,449 and state
net operating loss carryforwards of $9,454,496 available to
offset future taxable income. These carryfowards, if unused,
will expire in fiscal years ranging from 2013 to 2022.
The difference between the actual income tax benefit and the tax
benefit computed by applying the statutory federal income tax
rate to loss before income taxes is attributable to the
following:
Benefit for federal income taxes at statutory rate
$(30,801
)
State income taxes, net of federal tax benefit
(3,920
)
Change in valuation allowance
25,558
Other permanent items
9,163
Benefit for income taxes
$—
8.
Sale of Trucks
On September 10, 2003, the Company completed the sale of
its entire fleet of trucks and gasoline tankers to Hi-Ridge
Transport, Inc ("Hi-Ridge") for $2.3 million.
Upon completion of the sale, the Company entered into a service
contract with Hi-Ridge for the delivery of its fuel as discussed
in Note 9. The excess of the sales price over the estimated
fair value of the assets sold ($1,100,000) was recorded as a
deferred gain and will be recognized as income over the life of
the service contract.
9.
Commitments and Contingencies
Litigation
The Company is involved in disputes with respect to certain
interest rate agreements between the Company and a bank. The
Company has filed suits against the bank seeking judgment to
limit the Company's liability under the interest rate
agreements and requesting recovery of certain damages. The bank
claims that the Company owes the bank $1,055,000 plus interest
and legal costs. Management believes this matter will be
resolved with no material adverse impact to the Company's
results of operations, cash flows or financial position;
however, the ultimate outcome of this matter is currently
unknown. In addition to the above legal matter, the Company is
party to certain lawsuits arising in the normal course of
business. In the opinion of management, the amount of any
liability arising from these lawsuits will not be material to
the financial position or results of operations of the Company.
Service Contract
In conjunction with the sale of its fleet of trucks and gasoline
tankers as described in Note 8, the Company entered into a
ten-year noncancellable contract with Hi-Ridge for the delivery
of fuel to the Company's convenience stores as well as its
other fuel customers. The long-term service contract sets
delivery rates for Hi-Ridge over the next five years at stated
amounts, with the rate for the last five years to be negotiated.
10.
Subsequent Events
On April 30, 2004, the sole shareholder of the Company sold
all outstanding shares of stock in the Company to MAPCO Family
Centers, Inc. In connection with this transaction, all
outstanding debt of the Company was refinanced under terms
negotiated by the buyer.
F-93
Table of Contents
Shares
Delek US Holdings,
Inc.
Common Stock
PROSPECTUS
,
2006
Lehman
Brothers
Citigroup
Table of Contents
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13.
Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses, other than
underwriting discounts and commissions, payable by the
registrant in connection with the sale of common stock being
registered. All of the amounts shown are estimated except the
Securities and Exchange Commission registration fee, the
National Association of Securities Dealers, Inc.
("NASD") filing fee and the NYSE listing fee.
Amount to Be Paid
SEC registration fee
$
24,610
NASD filing fee
$
23,500
NYSE listing fee*
$
Printing and engraving expenses*
$
Legal fees and expenses*
$
Accounting fees and expenses*
$
Blue sky fees and expenses*
$
Transfer agent and registrar fees*
$
Miscellaneous fees and expenses*
$
Total
$
*
To be completed by amendment.
Item 14.
Indemnification of Directors and Officers.
Section 145(a) of the Delaware General Corporation Law (the
"DGCL") provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the
corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation or enterprise,
against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with such action, suit or
proceeding if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe the
person's conduct was unlawful.
Section 145(b) provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that such person
acted in any of the capacities set forth above, against expenses
(including attorneys' fees) actually and reasonably
incurred by the person in connection with the defense or
settlement of such action or suit if the person acted under
standards similar to those discussed above, except that no
indemnification may be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the
court in which such action or suit was brought shall determine
that despite the adjudication of liability, such person is
fairly and reasonably entitled to be indemnified for such
expenses which the court shall deem proper.
Section 145 further provides that to the extent a director
or officer of a corporation has been successful in the defense
of any action, suit or proceeding referred to in subsections
(a) and (b) or in the defense of any claim, issue or
matter therein, such person shall be indemnified against
expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith; that
indemnification provided for by
II-1
Table of Contents
Section 145 shall not be deemed exclusive of any other
rights to which the indemnified party may be entitled; and that
the corporation may purchase and maintain insurance on behalf of
a director or officer of the corporation against any liability
asserted against such person or incurred by such person in any
such capacity or arising out of such person's status as
such whether or not the corporation would have the power to
indemnify such person against such liabilities under
Section 145.
The registrant's amended and restated bylaws provide that
the registrant shall indemnify any director or officer of the
corporation, and may indemnify any other person, who
(a) was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the
corporation) by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines, and amounts
paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in
good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful, and (b) was or
is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses (including
attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit
if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation
and except that no indemnification shall be made in respect of
any claim, issue or matter as to which such person shall have
been adjudged to be liable to the corporation unless and only to
the extent that the Delaware Court of Chancery or the court in
which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which the
Delaware Court of Chancery or such other court shall deem proper.
Section 102(b)(7) of the DGCL provides that a certificate
of incorporation may contain a provision eliminating or limiting
the personal liability of a director to the corporation or its
stockholders for monetary damages for breach of fiduciary duty
as a director, provided that such provision shall not eliminate
or limit the liability of a director: (i) for any breach of
the director's duty of loyalty to the corporation or its
stockholders; (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation
of law; (iii) under Section 174 of the DGCL; or
(iv) for any transaction from which the director derived an
improper personal benefit.
The registrant's amended and restated certificate of
incorporation provides that, to the fullest extent permitted by
the DGCL, as the same exists or hereafter may be amended, a
director of the corporation shall not be personally liable to
the corporation or its stockholders for monetary damages for the
breach of any fiduciary duty as a director, except for liability
(i) for any breach of the director's duty of loyalty
to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or that involve intentional
misconduct or a knowing violation of law, (iii) under
Section 174 of the DGCL, as the same exists or hereafter
may be amended, or (iv) for any transaction from which the
director derived an improper personal benefit.
In addition, the registrant has entered into indemnification
agreements, in the forms attached as Exhibits 10.3 and 10.4
hereto, with its directors and executive officers which would
require the registrant, among other things, to indemnify them
against certain liabilities which may arise by reason of their
status.
The registrant maintains directors' and officers'
liability insurance for its officers and directors.
The underwriting agreement filed as Exhibit 1.1 to this
Registration Statement contains provisions indemnifying officers
and directors of the registrant against liabilities arising
under the Securities Act of 1933, as amended, or Securities Act,
or otherwise.
II-2
Table of Contents
Item 15.
Recent Sales of Unregistered Securities.
Set forth below is information regarding securities issued by
the registrant in the last three years in transactions that were
not registered under the Securities Act including the
consideration, if any, received by the registrant for such
issuances.
On May 1, 2004, the registrant granted share purchase
rights to Ezra Uzi Yemin, the President and Chief Executive
Officer, that permit Mr. Yemin to purchase, subject to
vesting requirements, up
to                      shares
of the registrant's common stock, pursuant to the terms of
his employment agreement.
The share purchase rights and the shares of common stock
issuable upon the exercise thereof were issued in reliance on
the exemption from registration provided by Section 4(2) of
the Securities Act and Rule 701 promulgated thereunder. No
underwriters were involved in connection with any of the sales
of securities referred to in this Item 15.
Item 16.
Exhibits and Financial Statement Schedules.
(a)
Exhibits.
Exhibit
No.
Description
1
.1*
Form of Underwriting Agreement.
3
.1*
Amended and Restated Certificate of Incorporation.
3
.2*
Amended and Restated Bylaws.
4
.1*
Specimen common stock certificate.
5
.1*
Opinion of Fulbright & Jaworski L.L.P.
10
.1
Employment Agreement, dated as of May 1, 2004, by and
    between MAPCO Express, Inc., Uzi Yemin and Delek US Holdings,
    Inc.
10
.1(a)
Amendment No. 1 to Employment Agreement, dated as of
    October 31, 2005 and effective as of September 15,
    2005, by and among MAPCO Express, Inc., Delek US Holdings, Inc.
    and Uzi Yemin.
10
.1(b)
Amendment No. 2 to Employment Agreement, dated as of
    February 1, 2006, by and among MAPCO Express, Inc., Delek
    US Holdings, Inc. and Uzi Yemin.
10
.2
Consulting Agreement, dated as of May 1, 2005, by and
    between Greenfeld-Energy Consulting, Ltd. and Delek Refining,
    Ltd.
10
.3*
Form of Director Indemnification Agreement.
10
.4*
Form of Officer Indemnification Agreement.
10
.5+
Distribution Service Agreement, dated as of January 1,
    2005, by and between MAPCO Express, Inc. and McLane Company,
    Inc. DBA McLane Grocery Distribution.
10
.6+
RPC Agreement, dated as of May 30, 2001, by and between
    Williams Refining & Marketing, LLC and MAPCO Express,
    Inc.
10
.6(a)
Assignment and Assumption Agreement effective as of
    March 3, 2003, by and between Williams Refining &
    Marketing, L.L.C., Williams Generating Memphis, L.L.C., Williams
    Memphis Terminal, Inc., and Williams Petroleum Pipeline Systems,
    Inc. and The Premcor Refining Group Inc.
10
.6(b)
Assignment of the RPC Agreement between Williams Refining &
    Marketing, LLC and MAPCO Express, Inc., dated May 30, 2001,
    from The Premcor Refining Group, Inc. to Valero Marketing and
    Supply Company, effective December 1, 2005.
10
.7
Amended and Restated Credit Agreement, dated as of
    April 28, 2005, among MAPCO Express, Inc., MAPCO Family
    Centers, Inc., the several lenders from time to time party to
    the Agreement, Lehman Brothers Inc., SunTrust Bank, Bank Leumi
    USA and Lehman Commercial Paper Inc.
10
.7(a)
First Amendment to Amended and Restated Credit Agreement, dated
    as of August 18, 2005, among MAPCO Express, Inc., MAPCO
    Family Centers, Inc., the several banks and other financial
    institutions or entities from time to time parties thereto,
    Lehman Brothers Inc., SunTrust Bank, Bank Leumi USA and Lehman
    Commercial Paper Inc.
II-3
Table of Contents
Exhibit
No.
Description
10
.7(b)
Second Amendment to Amended and Restated Credit Agreement, dated
    as of October 11, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Agreement, Lehman Brothers Inc.,
    SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper Inc.
10
.7(c)
Third Amendment to Amended and Restated Credit Agreement, dated
    as of December 15, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Credit Agreement, Lehman Brothers
    Inc., SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper
    Inc.
10
.8
Amended and Restated Revolving Credit Agreement, dated as of
    May 2, 2005, among Delek Refining, Ltd., Delek Pipeline
    Texas, Inc., the several banks and other financial institutions
    and lenders from time to time party thereto, SunTrust Bank, The
    CIT Group/ Business Credit, Inc., National City Business Credit,
    Inc., Bank of America, N.A. and PNC Business Credit, Inc.
10
.8(a)
First Amendment to Amended and Restated Credit Agreement, dated
    as of October 1, 2005, among Delek Refining, Ltd., Delek
    Pipeline Texas, Inc., various financial institutions, SunTrust
    Bank and The CIT Group/ Business Credit, Inc.
10
.9
Stock Purchase Agreement, dated as of March 29, 2004, by
    and among Delek US Holdings, Inc., MAPCO Family Centers, Inc.
    (n/k/a MAPCO Express, Inc.) and John R. Williamson.
10
.10
Refinery Purchase and Sale Agreement, dated as of March 14,
    2005, by and between La Gloria Oil and Gas Company, Delek
    Refining, Ltd., Delek Pipeline Texas, Inc. and Delek Texas Land,
    Inc.
10
.10(a)
Amendment to Refinery Purchase and Sale Agreement, dated as of
    April 29, 2005, by and between La Gloria Oil and Gas
    Company, Delek Refining, Ltd., Delek Pipeline Texas, Inc. and
    Delek Texas Land, Inc.
10
.10(b)
Second Amendment to Refinery Purchase and Sale Agreement and
    Indemnity Agreement, dated October 10, 2005, by and between
    La Gloria Oil and Gas Company (renamed Tyler Holding
    Company, Inc.), Delek Refining, Ltd., Delek Pipeline Texas, Inc.
    and Delek Texas Land, Inc.
10
.11+
Pipeline Capacity Lease Agreement, dated April 12, 1999,
    between La Gloria Oil and Gas Company and Scurlock Permian
    LLC.
10
.11(a)+
One-Year Renewal of Pipeline Capacity Lease Agreement, dated
    December 21, 2004, between Plains Marketing, L.P., as
    successor to Scurlock Permian LLC, and La Gloria Oil and
    Gas Company.
10
.11(b)+
Assignment of the Pipeline Capacity Lease Agreement, as amended
    and renewed on December 21, 2004, by La Gloria Oil and
    Gas Company to Delek Refining, Ltd.
10
.11(c)+
Amendment to One-Year Renewal of Pipeline Capacity Lease
    Agreement, dated January 15, 2006, between Delek Refining,
    Ltd. and Plains Marketing, L.P.
10
.11(d)
Extension of Pipeline Capacity Lease Agreement, dated
    January 15, 2006, between Delek Refining, Ltd. and Plains
    Marketing, L.P.
10
.12+
Branded Jobber Contract, dated December 15, 2005, between
    BP Products North America, Inc. and MAPCO Express, Inc.
10
.13*
Form of Delek US Holdings, Inc. 2006 Long-Term Incentive Plan.
10
.14*
Summary of Director Compensation for Non-Employees and for
    Non-Affiliates of Delek Group Ltd.
10
.15
Management and Consulting Agreement, dated as of January 1,
    2006, by and between Delek Group Ltd. and Delek
    US Holdings, Inc.
16
.1
Letter from Ernst & Young LLP re Change in Certifying
    Accountant.
16
.2
Letter from Mayer Hoffman McCann P.C. re Change in Certifying
    Accountant.
21
.1
Subsidiaries of the Registrant.
23
.1*
Consent of Fulbright & Jaworski L.L.P. (included in
    Exhibit 5.1).
23
.2
Consent of Ernst & Young LLP.
23
.3
Consent of Ernst & Young LLP.
23
.4
Consent of Ernst & Young LLP.
II-4
Table of Contents
Exhibit
No.
Description
23
.5
Consent of Mayer Hoffman McCann P.C.
24
.1
Power of Attorney (on signature page).
*
To be filed by amendment.
+
Confidential treatment has been requested with respect to
    certain portions of this exhibit pursuant to Rule 406 of
    the Securities Act. Omitted portions have been filed separately
    with the Securities and Exchange Commission.
(b) Financial statement schedules.
All financial statement schedules are omitted because they are
inapplicable, not required or the information is indicated
elsewhere in the consolidated financial statements or the notes
thereto.
Item 17.
Undertakings.
A. Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to directors, officers, and
controlling persons of the registrant pursuant to the provisions
described above in Item 14, or otherwise, the registrant
has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted against
the registrant by such director, officer or controlling person
in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final
adjudication of such issue.
B. The undersigned registrant hereby undertakes to provide
to the underwriter at the closing specified in the underwriting
agreement, certificates in such denominations and registered in
such names as required by the underwriter to permit prompt
delivery to each purchaser.
C. The undersigned registrant hereby undertakes that:
1. For purposes of determining any liability under the
    Securities Act, the information omitted from the form of
    prospectus filed as part of this Registration Statement in
    reliance upon Rule 430A and contained in a form of
    prospectus filed by the registrant pursuant to
    Rule 424(b)(1) or (4) or 497(h) under the Securities
    Act shall be deemed to be part of this registration statement as
    of the time it was declared effective.
2. For the purpose of determining any liability under the
    Securities Act, each post-effective amendment that contains a
    form of prospectus shall be deemed to be a new registration
    statement relating to the securities offered therein, and the
    offering of such securities at that time shall be deemed to be
    the initial bona fide offering thereof.
II-5
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the registrant has duly caused this registration
statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Franklin, State of
Tennessee, on February 8, 2006.
DELEK US HOLDINGS, INC.
(Registrant)
By:
/s/
Ezra Uzi Yemin
Name:  Ezra Uzi Yemin
Title:   President and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below appoints Ezra Uzi
Yemin and Edward Morgan, and each of them, any of whom may act
without the joinder of the other, as his true and lawful
attorney-in
-fact and
agent, with full power of substitution and resubstitution, for
him and in his name, place and stead, in any and all capacities,
to sign any and all amendments (including post-effective
amendments) to this Registration Statement and any Registration
Statement (including any amendment thereto) for this offering
that is to be effective upon filing pursuant to Rule 462(b)
under the Securities Act of 1933, as amended, and to file the
same, with all exhibits thereto, and all other documents in
connection therewith, with the Securities and Exchange
Commission, granting unto said
attorneys-in
-fact and
agents full power and authority to do and perform each and every
act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or would do in person,
hereby ratifying and confirming all that said
attorneys-in
-fact and
agents or any of them of their or his substitute and
substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this registration statement has been signed by the
following persons in the capacities and on the dates indicated.
Signature
Title
Date
/s/
Ezra Uzi Yemin
Ezra Uzi Yemin
President and Chief Executive Officer (Principal Executive
    Officer) and Director
February 8, 2006
/s/
Edward Morgan
Edward Morgan
Vice President and Treasurer (Principal Financial and Accounting
    Officer)
February 8, 2006
/s/
Gabriel Last
Gabriel Last
Director
February 8, 2006
/s/
Asaf Bartfeld
Asaf Bartfeld
Director
February 8, 2006
/s/
Ronel Ben-Dov
Ronel Ben-Dov
Director
February 8, 2006
/s/
Zvi Greenfeld
Zvi Greenfeld
Director
February 8, 2006
II-6
Table of Contents
EXHIBIT INDEX
Exhibit
No.
Description
1
.1*
Form of Underwriting Agreement.
3
.1*
Amended and Restated Certificate of Incorporation.
3
.2*
Amended and Restated Bylaws.
4
.1*
Specimen common stock certificate.
5
.1*
Opinion of Fulbright & Jaworski L.L.P.
10
.1
Employment Agreement, dated as of May 1, 2004, by and
    between MAPCO Express, Inc., Uzi Yemin and Delek US Holdings,
    Inc.
10
.1(a)
Amendment No. 1 to Employment Agreement, dated as of
    October 31, 2005 and effective as of September 15,
    2005, by and among MAPCO Express, Inc., Delek US Holdings, Inc.
    and Uzi Yemin.
10
.1(b)
Amendment No. 2 to Employment Agreement, dated as of
    February 1, 2006, by and among MAPCO Express, Inc., Delek
    US Holdings, Inc. and Uzi Yemin.
10
.2
Consulting Agreement, dated as of May 1, 2005, by and
    between Greenfeld-Energy Consulting, Ltd. and Delek Refining,
    Ltd.
10
.3*
Form of Director Indemnification Agreement.
10
.4*
Form of Officer Indemnification Agreement.
10
.5+
Distribution Service Agreement, dated as of January 1,
    2005, by and between MAPCO Express, Inc. and McLane Company,
    Inc. DBA McLane Grocery Distribution.
10
.6+
RPC Agreement, dated as of May 30, 2001, by and between
    Williams Refining & Marketing, LLC and MAPCO Express,
    Inc.
10
.6(a)
Assignment and Assumption Agreement effective as of
    March 3, 2003, by and between Williams Refining &
    Marketing, L.L.C., Williams Generating Memphis, L.L.C., Williams
    Memphis Terminal, Inc., and Williams Petroleum Pipeline Systems,
    Inc. and The Premcor Refining Group Inc.
10
.6(b)
Assignment of the RPC Agreement between Williams Refining &
    Marketing, LLC and MAPCO Express, Inc., dated May 30, 2001,
    from The Premcor Refining Group, Inc. to Valero Marketing and
    Supply Company, effective December 1, 2005.
10
.7
Amended and Restated Credit Agreement, dated as of
    April 28, 2005, among MAPCO Express, Inc., MAPCO Family
    Centers, Inc., the several lenders from time to time party to
    the Agreement, Lehman Brothers Inc., SunTrust Bank, Bank Leumi
    USA and Lehman Commercial Paper Inc.
10
.7(a)
First Amendment to Amended and Restated Credit Agreement, dated
    as of August 18, 2005, among MAPCO Express, Inc., MAPCO
    Family Centers, Inc., the several banks and other financial
    institutions or entities from time to time parties thereto,
    Lehman Brothers Inc., SunTrust Bank, Bank Leumi USA and Lehman
    Commercial Paper Inc.
10
.7(b)
Second Amendment to Amended and Restated Credit Agreement, dated
    as of October 11, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Agreement, Lehman Brothers Inc.,
    SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper Inc.
10
.7(c)
Third Amendment to Amended and Restated Credit Agreement, dated
    as of December 15, 2005, among MAPCO Express, Inc., the
    several banks and other financial institutions or entities from
    time to time parties to the Credit Agreement, Lehman Brothers
    Inc., SunTrust Bank, Bank Leumi USA and Lehman Commercial Paper
    Inc.
10
.8
Amended and Restated Revolving Credit Agreement, dated as of
    May 2, 2005, among Delek Refining, Ltd., Delek Pipeline
    Texas, Inc., the several banks and other financial institutions
    and lenders from time to time party thereto, SunTrust Bank, The
    CIT Group/ Business Credit, Inc., National City Business Credit,
    Inc., Bank of America, N.A. and PNC Business Credit, Inc.
10
.8(a)
First Amendment to Amended and Restated Credit Agreement, dated
    as of October 1, 2005, among Delek Refining, Ltd., Delek
    Pipeline Texas, Inc., various financial institutions, SunTrust
    Bank and The CIT Group/ Business Credit, Inc.
Table of Contents
Exhibit
No.
Description
10
.9
Stock Purchase Agreement, dated as of March 29, 2004, by
    and among Delek US Holdings, Inc., MAPCO Family Centers, Inc.
    (n/k/a MAPCO Express, Inc.) and John R. Williamson.
10
.10
Refinery Purchase and Sale Agreement, dated as of March 14,
    2005, by and between La Gloria Oil and Gas Company, Delek
    Refining, Ltd., Delek Pipeline Texas, Inc. and Delek Texas Land,
    Inc.
10
.10(a)
Amendment to Refinery Purchase and Sale Agreement, dated as of
    April 29, 2005, by and between La Gloria Oil and Gas
    Company, Delek Refining, Ltd., Delek Pipeline Texas, Inc. and
    Delek Texas Land, Inc.
10
.10(b)
Second Amendment to Refinery Purchase and Sale Agreement and
    Indemnity Agreement, dated October 10, 2005, by and between
    La Gloria Oil and Gas Company (renamed Tyler Holding
    Company, Inc.), Delek Refining, Ltd., Delek Pipeline Texas, Inc.
    and Delek Texas Land, Inc.
10
.11+
Pipeline Capacity Lease Agreement, dated April 12, 1999,
    between La Gloria Oil and Gas Company and Scurlock Permian
    LLC.
10
.11(a)+
One-Year Renewal of Pipeline Capacity Lease Agreement, dated
    December 21, 2004, between Plains Marketing, L.P., as
    successor to Scurlock Permian LLC, and La Gloria Oil and
    Gas Company.
10
.11(b)+
Assignment of the Pipeline Capacity Lease Agreement, as amended
    and renewed on December 21, 2004, by La Gloria Oil and
    Gas Company to Delek Refining, Ltd.
10
.11(c)+
Amendment to One-Year Renewal of Pipeline Capacity Lease
    Agreement, dated January 15, 2006, between Delek Refining,
    Ltd. and Plains Marketing, L.P.
10
.11(d)
Extension of Pipeline Capacity Lease Agreement, dated
    January 15, 2006, between Delek Refining, Ltd. and Plains
    Marketing, L.P.
10
.12+
Branded Jobber Contract, dated December 15, 2005, between
    BP Products North America, Inc. and MAPCO Express, Inc.
10
.13*
Form of Delek US Holdings, Inc. 2006 Long-Term Incentive Plan.
10
.14*
Summary of Director Compensation for Non-Employees and for
    Non-Affiliates of Delek Group Ltd.
10
.15
Management and Consulting Agreement, dated as of January 1,
    2006, by and between Delek Group Ltd. and Delek
    US Holdings, Inc.
16
.1
Letter from Ernst & Young LLP re Change in Certifying
    Accountant.
16
.2
Letter from Mayer Hoffman McCann P.C. re Change in Certifying
    Accountant.
21
.1
Subsidiaries of the Registrant.
23
.1*
Consent of Fulbright & Jaworski L.L.P. (included in
    Exhibit 5.1).
23
.2
Consent of Ernst & Young LLP.
23
.3
Consent of Ernst & Young LLP.
23
.4
Consent of Ernst & Young LLP.
23
.5
Consent of Mayer Hoffman McCann P.C.
24
.1
Power of Attorney (on signature page).