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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549







FORM 10-Q



(Mark One)



|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------



For the quarterly period ended May 31,
2011



or



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the transition period from
                     to



Commission File No.
001-06198







|                                   |  |                                                                               
|---------------------------------- |  | ------------------------------------------------------------------------------
|LOGO[LOGO] UNITED REFINING COMPANY |  | UNITED REFINING COMPANY (Exact name of registrant as specified in its charter)



|                                                              |  |                                    
|------------------------------------------------------------- |  | -----------------------------------
|Pennsylvania                                                  |  | 25-1411751                         
|(State or other jurisdiction ofincorporation or organization) |  | (I.R.S. EmployerIdentification No.)
|                                                              | 
|15 Bradley StreetWarren, Pennsylvania                         |  | 16365                              
|(Address of principal executive office)                       |  | (Zip Code)                         



814-723-1500

(Registrants telephone number, including area code)







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



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



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



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



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



As of July 8, 2011, there were 100 shares of common stock, par value $.10 per share, of the Registrant outstanding.









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##### Table of Contents

TABLE OF ADDITIONAL REGISTRANTS



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



2



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##### Table of Contents

FORM 10-Q  CONTENTS



|            |  |                                                                                                          |    |         |    | 
|----------- |  | -------------------------------------------------------------------------------------------------------- | -- | ------- | -- | 
|            |  |                                                                                                          |    | PAGE(S) |   
|PART I.     |  | FINANCIAL INFORMATION                                                                                    |    |         | 4  | 
|            |  |                                                                                                         
|Item 1.     |  | Financial Statements.                                                                                    |    |         | 4  | 
|            |  |                                                                                                         
|            |  | Consolidated Balance Sheets  May 31, 2011 (unaudited) and August 31, 2010                               |    |         | 4  | 
|            |  |                                                                                                         
|            |  | Consolidated Statements of Operations  Quarter and Nine Months Ended May 31, 2011 and
 2010 (unaudited) |    |         | 5  | 
|            |  |                                                                                                         
|            |  | Consolidated Statements of Cash Flows  Nine Months Ended May 31, 2011 and 2010 (unaudited)              |    |         | 6  | 
|            |  |                                                                                                         
|            |  | Notes to Consolidated Financial Statements (unaudited)                                                   |    |         | 7  | 
|            |  |                                                                                                         
|Item 2.     |  | Managements Discussion and Analysis of Financial Condition and Results ofOperations.                    |    |         | 18 | 
|            |  |                                                                                                         
|Item 3.     |  | Quantitative and Qualitative Disclosures about Market Risk.                                              |    |         | 27 | 
|            |  |                                                                                                         
|Item 4.     |  | Controls and Procedures.                                                                                 |    |         | 27 | 
|            |  |                                                                                                         
|PART II.    |  | OTHER INFORMATION                                                                                        |    |         | 29 | 
|            |  |                                                                                                         
|Item 1.     |  | Legal Proceedings.                                                                                       |    |         | 29 | 
|            |  |                                                                                                         
|Item 1A.    |  | Risk Factors.                                                                                            |    |         | 29 | 
|            |  |                                                                                                         
|Item 2.     |  | Unregistered Sales of Equity Securities and Use of Proceeds.                                             |    |         | 29 | 
|            |  |                                                                                                         
|Item 3.     |  | Defaults Upon Senior Securities.                                                                         |    |         | 29 | 
|            |  |                                                                                                         
|Item 4.     |  | (Removed and Reserved).                                                                                  |    |         | 29 | 
|            |  |                                                                                                         
|Item 5.     |  | Other Information.                                                                                       |    |         | 29 | 
|            |  |                                                                                                         
|Item 6.     |  | Exhibits.                                                                                                |    |         | 29 | 
|            | 
|Signatures. |  |                                                                                                          | 31 |        



3



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##### Table of Contents

|PART I. | FINANCIAL INFORMATION
|------- | ---------------------



|Item 1. | Financial Statements.
|------- | ---------------------



UNITED REFINING COMPANY AND SUBSIDIARIES



Consolidated Balance Sheets

(in thousands, except share amounts)



|                                                                                           |  |                        |         |   |                |   |         |  
|------------------------------------------------------------------------------------------ |  | ---------------------- | ------- | - | -------------- | - | ------- | -
|                                                                                           |  | May 31,2011(Unaudited) |         |   | August 31,2010 |  
|Assets                                                                                     |  |                        |         |   |                |   |         |  
|Current:                                                                                   |  |                        |         |   |                |   |         |  
|Cash and cash equivalents                                                                  |  | $                      | 27,710  |   |                | $ | 17,170  |  
|Accounts receivable, net                                                                   |  |                        | 123,184 |   |                |   | 64,192  |  
|Refundable income taxes                                                                    |  |                        |        |   |                |   | 36,390  |  
|Inventories                                                                                |  |                        | 200,163 |   |                |   | 206,838 |  
|Prepaid expenses and other assets                                                          |  |                        | 42,713  |   |                |   | 27,941  |  
|Amounts due from affiliated companies, net                                                 |  |                        | 1,966   |   |                |   | 2,972   |  
|                                                                                           |  |                        |         |   |                |   |         |  
|Total current assets                                                                       |  |                        | 395,736 |   |                |   | 355,503 |  
|Property, plant and equipment, net                                                         |  |                        | 271,737 |   |                |   | 261,775 |  
|Deferred financing costs, net                                                              |  |                        | 10,036  |   |                |   | 2,114   |  
|Goodwill                                                                                   |  |                        | 1,349   |   |                |   | 1,349   |  
|Tradename                                                                                  |  |                        | 10,500  |   |                |   | 10,500  |  
|Amortizable intangible assets, net                                                         |  |                        | 1,296   |   |                |   | 1,376   |  
|Deferred turnaround costs and other assets, net                                            |  |                        | 15,566  |   |                |   | 3,894   |  
|Deferred income taxes                                                                      |  |                        | 414     |   |                |   | 592     |  
|                                                                                           |  |                        |         |   |                |   |         |  
|                                                                                           |  | $                      | 706,634 |   |                | $ | 637,103 |  
|                                                                                           |  |                        |         |   |                |   |         |  
|                                                                                           |  |                       
|Liabilities and Stockholders Equity                                                       |  |                        |         |   |                |   |         |  
|Current:                                                                                   |  |                        |         |   |                |   |         |  
|Revolving credit facility  non-controlling interest                                       |  | $                      | 10,900  |   |                | $ |        |  
|Current installments of long-term debt                                                     |  |                        | 956     |   |                |   | 1,888   |  
|Accounts payable                                                                           |  |                        | 55,015  |   |                |   | 65,620  |  
|Accrued liabilities                                                                        |  |                        | 22,793  |   |                |   | 15,569  |  
|Income taxes payable                                                                       |  |                        | 3,097   |   |                |   | 552     |  
|Sales, use and fuel taxes payable                                                          |  |                        | 18,989  |   |                |   | 18,455  |  
|Deferred income taxes                                                                      |  |                        | 5,997   |   |                |   | 5,997   |  
|                                                                                           |  |                        |         |   |                |   |         |  
|Total current liabilities                                                                  |  |                        | 117,747 |   |                |   | 108,081 |  
|Revolving credit facility                                                                  |  |                        | 102,000 |   |                |   | 83,000  |  
|Long term debt: less current installments                                                  |  |                        | 355,384 |   |                |   | 328,165 |  
|Deferred retirement benefits                                                               |  |                        | 88,292  |   |                |   | 91,620  |  
|                                                                                           |  |                        |         |   |                |   |         |  
|Total liabilities                                                                          |  |                        | 663,423 |   |                |   | 610,866 |  
|                                                                                           |  |                        |         |   |                |   |         |  
|                                                                                           |  |                       
|Commitments and contingencies                                                              |  |                        |         |   |                |   |         |  
|Stockholders equity:                                                                      |  |                        |         |   |                |   |         |  
|Common stock; $.10 par value per share  shares authorized 100; issued and outstanding 100 |  |                        |        |   |                |   |        |  
|Additional paid-in capital                                                                 |  |                        | 22,500  |   |                |   | 22,500  |  
|Retained earnings                                                                          |  |                        | 19,494  |   |                |   | 18,231  |  
|Accumulated other comprehensive loss                                                       |  |                        | (14,094 | ) |                |   | (14,494 | )
|                                                                                           |  |                        |         |   |                |   |         |  
|Controlling interest equity                                                                |  |                        | 27,900  |   |                |   | 26,237  |  
|Non-controlling interest                                                                   |  |                        | 15,311  |   |                |   |        |  
|                                                                                           |  |                        |         |   |                |   |         |  
|Total stockholders equity                                                                 |  |                        | 43,211  |   |                |   | 26,237  |  
|                                                                                           |  |                        |         |   |                |   |         |  
|                                                                                           |  | $                      | 706,634 |   |                | $ | 637,103 |  
|                                                                                           |  |                        |         |   |                |   |         |  



See accompanying notes to
consolidated financial statements.



4



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UNITED REFINING COMPANY AND SUBSIDIARIES



Consolidated Statements of Operations  (Unaudited)

(in thousands)



|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|----------------------------------------------------------------------- |  | ------------------------- | ------- | - | ------------------------ | - | ------- | ---- |  | - | --------- | - |  | - | --------- | -
|                                                                        |  | Three Months EndedMay 31, |         |   | Nine Months EndedMay 31, |  
|                                                                        |  | 2011                      |         |   | 2010                     |   |         | 2011 |  |   | 2010      |  
|Net sales                                                               |  | $                         | 808,115 |   |                          | $ | 705,322 |      |  | $ | 2,119,541 |   |  | $ | 1,920,996 |  
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Costs and expenses:                                                     |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Costs of goods sold (exclusive of depreciation and amortization)        |  |                           | 736,968 |   |                          |   | 674,641 |      |  |   | 1,957,646 |   |  |   | 1,862,603 |  
|Selling, general and administrative expenses                            |  |                           | 37,512  |   |                          |   | 37,191  |      |  |   | 110,117   |   |  |   | 111,634   |  
|Depreciation and amortization expenses                                  |  |                           | 5,256   |   |                          |   | 5,467   |      |  |   | 16,243    |   |  |   | 16,435    |  
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|                                                                        |  |                           | 779,736 |   |                          |   | 717,299 |      |  |   | 2,084,006 |   |  |   | 1,990,672 |  
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Operating income (loss)                                                 |  |                           | 28,379  |   |                          |   | (11,977 | )    |  |   | 35,535    |   |  |   | (69,676   | )
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Other income (expense):                                                 |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Interest expense, net and financing costs                               |  |                           | (11,761 | ) |                          |   | (8,983  | )    |  |   | (29,570   | ) |  |   | (26,162   | )
|Other, net                                                              |  |                           | (805    | ) |                          |   | (620    | )    |  |   | (2,196    | ) |  |   | (1,432    | )
|Loss on early extinguishment of debt                                    |  |                           | (1,245  | ) |                          |   |        |      |  |   | (1,245    | ) |  |   |          |  
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|                                                                        |  |                           | (13,811 | ) |                          |   | (9,603  | )    |  |   | (33,011   | ) |  |   | (27,594   | )
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Income (loss) before income tax expense (benefit)                       |  |                           | 14,568  |   |                          |   | (21,580 | )    |  |   | 2,524     |   |  |   | (97,270   | )
|Income tax expense (benefit)                                            |  |                           | 5,259   |   |                          |   | (4,728  | )    |  |   | 950       |   |  |   | (35,763   | )
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Net income (loss)                                                       |  |                           | 9,309   |   |                          |   | (16,852 | )    |  |   | 1,574     |   |  |   | (61,507   | )
|Less net income attributable to non-controlling interest                |  |                           | 218     |   |                          |   |        |      |  |   | 311       |   |  |   |          |  
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  
|Net income (loss) attributable to United Refining Companys Stockholder |  | $                         | 9,091   |   |                          | $ | (16,852 | )    |  | $ | 1,263     |   |  | $ | (61,507   | )
|                                                                        |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |           |  



See accompanying notes to
consolidated financial statements.



5



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UNITED REFINING COMPANY AND SUBSIDIARIES



Consolidated Statements of Cash Flows  (Unaudited)

(in thousands)



|                                                                                     |  |                          |          |   |      |   |         |  
|------------------------------------------------------------------------------------ |  | ------------------------ | -------- | - | ---- | - | ------- | -
|                                                                                     |  | Nine Months EndedMay 31, |         
|                                                                                     |  | 2011                     |          |   | 2010 |  
|Cash flows from operating activities:                                                |  |                          |          |   |      |   |         |  
|Net income (loss)                                                                    |  | $                        | 1,263    |   |      | $ | (61,507 | )
|Adjustments to reconcile net income (loss) to net cash used in operating activities: |  |                          |          |   |      |   |         |  
|Depreciation and amortization                                                        |  |                          | 17,410   |   |      |   | 16,686  |  
|Deferred income taxes                                                                |  |                          | (100     | ) |      |   | (5,413  | )
|Non-cash portion of loss on early extinguishment of debt                             |  |                          | 330      |   |      |   |        |  
|Loss on asset dispositions                                                           |  |                          | 239      |   |      |   | 825     |  
|Cash used in working capital items                                                   |  |                          | (29,995  | ) |      |   | (37,794 | )
|Net income attributable to non-controlling interest                                  |  |                          | 311      |   |      |   |        |  
|Other, net                                                                           |  |                          | (2       | ) |      |   | 2       |  
|Change in operating assets and liabilities:                                          |  |                          |          |   |      |   |         |  
|Deferred retirement benefits                                                         |  |                          | (2,649   | ) |      |   | 9,387   |  
|Other noncurrent liabilities                                                         |  |                          |         |   |      |   | (4      | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Total adjustments                                                                    |  |                          | (14,456  | ) |      |   | (16,311 | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Net cash used in operating activities                                                |  |                          | (13,193  | ) |      |   | (77,818 | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Cash flows from investing activities:                                                |  |                          |          |   |      |   |         |  
|Additions to property, plant and equipment                                           |  |                          | (23,178  | ) |      |   | (19,559 | )
|Additions to deferred turnaround costs                                               |  |                          | (14,702  | ) |      |   | (1,060  | )
|Proceeds from asset dispositions                                                     |  |                          | 57       |   |      |   | 25      |  
|                                                                                     |  |                          |          |   |      |   |         |  
|Net cash used in investing activities                                                |  |                          | (37,823  | ) |      |   | (20,594 | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Cash flows from financing activities:                                                |  |                          |          |   |      |   |         |  
|Net borrowings on revolving credit facilities                                        |  |                          | 29,900   |   |      |   | 93,000  |  
|Proceeds from issuance of common stock of non-controlling interest                   |  |                          | 15,000   |   |      |   |        |  
|Proceeds from issuance of long term debt                                             |  |                          | 352,021  |   |      |   |        |  
|Principal reductions of long term debt                                               |  |                          | (324,809 | ) |      |   | (1,290  | )
|Deferred financing costs                                                             |  |                          | (10,556  | ) |      |   | (10     | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Net cash provided by financing activities                                            |  |                          | 61,556   |   |      |   | 91,700  |  
|                                                                                     |  |                          |          |   |      |   |         |  
|Net increase (decrease) in cash and cash equivalents                                 |  |                          | 10,540   |   |      |   | (6,712  | )
|Cash and cash equivalents, beginning of year                                         |  |                          | 17,170   |   |      |   | 31,062  |  
|                                                                                     |  |                          |          |   |      |   |         |  
|Cash and cash equivalents, end of period                                             |  | $                        | 27,710   |   |      | $ | 24,350  |  
|                                                                                     |  |                          |          |   |      |   |         |  
|Cash provided by (used in) working capital items:                                    |  |                          |          |   |      |   |         |  
|Accounts receivable, net                                                             |  | $                        | (58,992  | ) |      | $ | 94      |  
|Refundable income taxes                                                              |  |                          | 36,390   |   |      |   |        |  
|Inventories                                                                          |  |                          | 6,675    |   |      |   | 38,213  |  
|Prepaid expenses and other assets                                                    |  |                          | (14,772  | ) |      |   | (43,023 | )
|Amounts due from affiliated companies, net                                           |  |                          | 1,006    |   |      |   | 2,253   |  
|Accounts payable                                                                     |  |                          | (10,605  | ) |      |   | (35,552 | )
|Accrued liabilities                                                                  |  |                          | 7,224    |   |      |   | 6,761   |  
|Income taxes payable                                                                 |  |                          | 2,545    |   |      |   | (5,149  | )
|Sales, use and fuel taxes payable                                                    |  |                          | 534      |   |      |   | (1,391  | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Total change                                                                         |  | $                        | (29,995  | ) |      | $ | (37,794 | )
|                                                                                     |  |                          |          |   |      |   |         |  
|Cash paid during the period for:                                                     |  |                          |          |   |      |   |         |  
|Interest                                                                             |  | $                        | 22,068   |   |      | $ | 18,072  |  
|Income taxes                                                                         |  | $                        | 1,351    |   |      | $ | 5,651   |  
|                                                                                     |  |                          |          |   |      |   |         |  
|Non-cash investing activities:                                                       |  |                          |          |   |      |   |         |  
|Property additions & capital leases                                                  |  | $                        | 212      |   |      | $ | 805     |  
|                                                                                     |  |                          |          |   |      |   |         |  



See accompanying notes to
consolidated financial statements.



6



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial Statements

(Unaudited)



|1. | Description of Business and Basis of Presentation
|-- | -------------------------------------------------



The consolidated financial statements
include the accounts of United Refining Company and its subsidiaries, United Refining Company of Pennsylvania and its subsidiaries, Kiantone Pipeline Corporation (collectively, the Company), and United Refining Asphalt, Inc.
(URA) a variable interest entity that was created in January 2011 for which the Company is the primary beneficiary. All significant intercompany balances and transactions have been eliminated in consolidation.



A variable interest entity (VIE)
is defined as an entity that either has investor voting rights that are not proportional to their economic interests or has equity investors that do not provide sufficient financial resources for the entity to support its activities. A VIE is
required to be consolidated by a company if that company is the primary beneficiary. The primary beneficiary of the VIE is the company that controls the VIEs activities and is subject to a majority of the risk of loss from the VIEs
activities or, if no company is subject to a majority of such risk, the company that is entitled to receive a majority of the VIEs residual returns.



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



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



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



The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by
accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation
have been included. Operating results for the three and nine months ended May 31, 2011 are not necessarily indicative of the results that may be expected for the year ending August 31, 2011. For further information, refer to the
consolidated financial statements and footnotes thereto included in the Companys Form 10-K for the fiscal year ended August 31, 2010.



Certain items have been reclassified to conform to current period presentation.



|2. | Derivative Financial Instruments
|-- | --------------------------------



From time to time, the Company uses derivatives to reduce its exposure to fluctuations in crude oil purchase costs and
refining margins. Derivative products, specifically crude oil option contracts and crack spread option contracts are used to hedge the volatility of these items. The Company accounts for changes in the fair value of its contracts by marking them to
market and recognizing any resulting gains or losses in its Statement of Operations.



7



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



During the quarter ended May 31, 2011, the Company had 5,250,000
barrels of heating oil and gasoline crackspread swaps outstanding as part of its risk management strategy. The crackspread swaps expire sequentially beginning June 2011 through December 2012. These derivative instruments are being used by the
Company to lock in margins on future sales of diesel fuel and gasoline.



The fair value gain position (recorded in the Consolidated Statements of Operations) of our derivatives at May 31, 2011 are as follows:



|                                           |  |                   |  |              |                                      |  |                 |   |         | 
|------------------------------------------ |  | ----------------- |  | ------------ | ------------------------------------ |  | --------------- | - | ------- | 
|                                           |  | May 31, 2011      | 
|                                           |  | NotionalBalance   |  | MaturityDate |                                      |  | PrepaidExpenses |  
|Designated as hedges under ASC 815         |  |                   |  |              |                                      |  |                 |   |         | 
|None                                       |  |                   |  |              |                                      |  |                 |   |         | 
|Not designated as hedges under ASC 815     |  |                   |  |              |                                      |  |                 |   |         | 
|Heating oil and gasoline crackspread swaps |  | 5,250,000 barrels |  |              | Monthly June 2011 thru December 2012 |  |                 | $ | 897,123 | 
|                                           |  |                   |  |              |                                      |  |                 |   |         | 
|Total derivative instruments               |  |                   |  |              |                                      |  |                 | $ | 897,123 | 
|                                           |  |                   |  |              |                                      |  |                 |   |         | 



During the
three months ended May 31, 2011 net gains of $1.3 million from the realized net gains and changes in the fair value of our forward contracts were recognized as a reduction of cost of goods sold in the Companys Consolidated Statement
of Operations. The Company has included the carrying amount of the contract in prepaid expenses and other assets in its Consolidated Balance Sheet.



|3. | Inventories
|-- | -----------



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



Inventories consist
of the following:



|                   |  |                |         |  |                |   |         | 
|------------------ |  | -------------- | ------- |  | -------------- | - | ------- | 
|                   |  | May 31,2011    |         |  | August 31,2010 |  
|                   |  | (in thousands) |        
|Crude Oil          |  | $              | 39,019  |  |                | $ | 78,165  | 
|Petroleum Products |  |                | 103,826 |  |                |   | 86,993  | 
|                   |  |                |         |  |                |   |         | 
|Total @ LIFO       |  |                | 142,845 |  |                |   | 165,158 | 
|                   |  |                |         |  |                |   |         | 
|Asphalt  URA      |  |                | 15,290  |  |                |   |        | 
|Merchandise        |  |                | 19,310  |  |                |   | 20,403  | 
|Supplies           |  |                | 22,718  |  |                |   | 21,277  | 
|                   |  |                |         |  |                |   |         | 
|Total @ FIFO       |  |                | 57,318  |  |                |   | 41,680  | 
|                   |  |                |         |  |                |   |         | 
|Total Inventory    |  | $              | 200,163 |  |                | $ | 206,838 | 
|                   |  |                |         |  |                |   |         | 



As of
May 31, 2011 and August 31, 2010, the replacement cost of LIFO inventories exceeded their LIFO carrying values by approximately $105,729,000 and $50,265,000, respectively.



8



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



|4. | Credit Facility
|-- | ---------------



On May 18, 2011, the Company, United Refining Company of Pennsylvania, Kiantone Pipeline Corporation, Country Fair,
Inc. and Kwik-Fill Corporation (as Guarantor) entered into an amended and restated Revolving Credit Facility (Amended and Restated Revolving Credit Facility) with PNC Bank, National Association as Administrator (the Agent)
increasing the maximum facility commitment from $130,000,000 to $175,000,000 and extending the term to May 18, 2016. Under the Amended and Restated Revolving Credit Facility, interest is calculated as follows: (a) for base rate borrowings,
at the greater of the Agents prime rate, federal funds open rate plus 0.5% or the daily LIBOR rate plus 1.0% plus the applicable margin of 1.25% to 1.75% and (b) for euro-rate borrowings, at the LIBOR rate plus an applicable margin of
2.75% to 3.25%. The applicable margin will vary depending on a formula calculating the Companys unused availability under the facility. The Amended and Restated Revolving Credit Facility continues to be secured primarily by certain cash
accounts, accounts receivable and inventory. Until expiration on May 18, 2016, we may borrow on a borrowing base formula as set forth in the facility. The participating banks in the Amended and Restated Revolving Credit Facility are PNC Bank,
National Association, Bank of America, N.A., Manufacturers and Traders Trust Company, and Bank Leumi USA.



|5. | Long Term Debt
|-- | --------------



On March 8, 2011, the Company sold $365,000,000 of 10.500% First Priority Senior Secured Notes
due 2018 (the Senior Secured Notes) for $352,020,600, resulting in original issue discount of $12,979,400, which will be amortized over the life of the Senior Secured Notes using the interest method. The net proceeds of the offering of
$344,249,000 were used to retire all of its outstanding 101/2% Senior Notes due 2012, pay accrued interest of $3,400,000 and a redemption premium related thereto. A loss of $1,245,000 on the early extinguishment of debt was recorded consisting of a redemption
premium of $915,000, a write-off of unamortized net debt premium of $1,153,000 and a write-off of deferred financing costs of $1,483,000. The Senior Secured Notes are guaranteed on an unsecured basis by all of our domestic subsidiaries existing at
March 8, 2011. The Senior Secured Notes are secured on a first-priority basis by our assets comprising our refinery located in Warren, Pennsylvania and the capital stock of our pipeline subsidiary, subject to permitted liens. The Senior Secured
Notes will rank equally with all of our existing and future senior indebtedness that is not subordinate in right of payment to the Senior Secured Notes.



On February 22, 2011 the Company announced the launch of a cash tender offer (the Tender
Offer) for any and all of its outstanding
101/2% Senior Notes due 2012 issued under an
indenture dated as of August 6, 2004 (the 2012 Indenture) and consent solicitation (the Solicitation) for certain proposed amendments to the 2012 Indenture (the Proposed Amendments). Each holder who validly
tendered its Senior Notes due 2012 and delivered consents to the Proposed Amendments prior to 5:00 pm, New York City time, on March 7, 2011, (the Consent Date), received the total consideration of $1,005, which included $975 as the
tender offer consideration and $30 as a consent payment. In addition, accrued but unpaid interest up to, but not including, the applicable payment date of the Senior Notes due 2012 was paid in cash on all validly tendered and accepted the Senior
Notes due 2012. The Company paid a total of $188,607,726 on March 8, 2011 for $181,764,375 principal amount of the Senior Notes due 2012, $5,592,750 for consent payment (which is included in interest expense, net and financing costs), and
$1,250,601 for accrued interest on those Senior Notes due 2012 tendered.



The Tender Offer expired at 12:00 midnight, New York City time, on March 21, 2011. Holders who validly tendered their Senior Notes due 2012 after the Consent Date received only the tender offer
consideration and were not entitled to receive a consent payment pursuant to the Tender Offer. The Company paid the total consideration or tender offer consideration, as the case may be, plus accrued but unpaid interest, for the Senior Notes due
2012 accepted for purchase promptly following the date of such acceptance (such date, the Final



9



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



Payment Date). On March 22, 2011, the Company paid a total of $678,225 for $670,800 principal amount of the Senior Notes due 2012 and $7,425 for accrued interest on those Senior Notes
due 2012 tendered between the Consent Date (March 7, 2011) and the Final Payment Date (March 21, 2011).



On March 9, 2011, the Company issued a Notice of Redemption to all holders of its
101/2% Senior Notes due 2012 redeeming these
Senior Notes due 2012 at 100% par value plus accrued but unpaid interest on the redemption date of April 8, 2011. On April 8, 2011, $138,962,427 was paid in total, of which $136,847,000 was for principal amount of Senior Notes due 2012 and
$2,115,427 was for accrued interest.



|6. | Subsidiary Guarantors
|-- | ---------------------



All the Companys wholly-owned subsidiaries fully and unconditionally guarantee on an unsecured basis, on a joint and
several basis, the Companys Senior Secured Notes. There are no restrictions within the consolidated group on the ability of the Company or any of its subsidiaries to obtain loans from or pay dividends to other members of the consolidated
group. Financial information of the Companys wholly-owned subsidiary guarantors is as follows:



Condensed Consolidating Balance Sheets

(in thousands)



|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|---------------------------------------------------- |  | --------------------- | ------- |  | ---------- | - | ------- | ------------ |  | - | ------------------------------------ | - |  | -------------------------- | ------- |  | ------------ | - | ------ | --------------------------------- |  | - | ------- | - |  | - | ------- | 
|                                                     |  | May 31, 2011          |        
|                                                     |  | UnitedRefiningCompany |         |  | Guarantors |   |         | Eliminations |  |   | United RefiningCompany
&Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |         |  | Eliminations |   |        | UnitedRefiningCompanyConsolidated | 
|Assets                                               |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Current:                                             |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Cash and cash equivalents                            |  | $                     | 11,992  |  |            | $ | 14,745  |              |  | $ |                                     |   |  | $                          | 26,737  |  |              | $ | 973    |                                   |  | $ |        |   |  | $ | 27,710  | 
|Accounts receivable, net                             |  |                       | 60,248  |  |            |   | 47,174  |              |  |   |                                     |   |  |                            | 107,422 |  |              |   | 15,762 |                                   |  |   |        |   |  |   | 123,184 | 
|Inventories                                          |  |                       | 155,457 |  |            |   | 29,416  |              |  |   |                                     |   |  |                            | 184,873 |  |              |   | 15,290 |                                   |  |   |        |   |  |   | 200,163 | 
|Prepaid expenses and other assets                    |  |                       | 52,198  |  |            |   | 5,805   |              |  |   |                                     |   |  |                            | 58,003  |  |              |   |       |                                   |  |   | (15,290 | ) |  |   | 42,713  | 
|Amounts due from affiliated companies                |  |                       | 9,194   |  |            |   | (1,489  | )            |  |   |                                     |   |  |                            | 7,705   |  |              |   | (5,739 | )                                 |  |   |        |   |  |   | 1,966   | 
|Intercompany                                         |  |                       | 137,218 |  |            |   | 16,261  |              |  |   | (153,479                             | ) |  |                            |        |  |              |   |       |                                   |  |   |        |   |  |   |        | 
|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Total current assets                                 |  |                       | 426,307 |  |            |   | 111,912 |              |  |   | (153,479                             | ) |  |                            | 384,740 |  |              |   | 26,286 |                                   |  |   | (15,290 | ) |  |   | 395,736 | 
|Property, plant and equipment, net                   |  |                       | 196,100 |  |            |   | 75,637  |              |  |   |                                     |   |  |                            | 271,737 |  |              |   |       |                                   |  |   |        |   |  |   | 271,737 | 
|Deferred financing costs, net                        |  |                       | 9,842   |  |            |   |        |              |  |   |                                     |   |  |                            | 9,842   |  |              |   | 194    |                                   |  |   |        |   |  |   | 10,036  | 
|Goodwill and other non-amortizable assets            |  |                       |        |  |            |   | 11,849  |              |  |   |                                     |   |  |                            | 11,849  |  |              |   |       |                                   |  |   |        |   |  |   | 11,849  | 
|Amortizable intangible assets, net                   |  |                       |        |  |            |   | 1,296   |              |  |   |                                     |   |  |                            | 1,296   |  |              |   |       |                                   |  |   |        |   |  |   | 1,296   | 
|Deferred turnaround costs & other assets             |  |                       | 15,089  |  |            |   | 477     |              |  |   |                                     |   |  |                            | 15,566  |  |              |   |       |                                   |  |   |        |   |  |   | 15,566  | 
|Deferred income taxes                                |  |                       | 8,671   |  |            |   | (8,257  | )            |  |   |                                     |   |  |                            | 414     |  |              |   |       |                                   |  |   |        |   |  |   | 414     | 
|Investment in subsidiaries                           |  |                       | 5,825   |  |            |   |        |              |  |   | (5,825                               | ) |  |                            |        |  |              |   |       |                                   |  |   |        |   |  |   |        | 
|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|                                                     |  | $                     | 661,834 |  |            | $ | 192,914 |              |  | $ | (159,304                             | ) |  | $                          | 695,444 |  |              | $ | 26,480 |                                   |  | $ | (15,290 | ) |  | $ | 706,634 | 
|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Liabilities and Stockholders Equity                 |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Current:                                             |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Revolving credit facility  non-controlling interest |  | $                     |        |  |            | $ |        |              |  | $ |                                     |   |  | $                          |        |  |              | $ | 10,900 |                                   |  | $ |        |   |  | $ | 10,900  | 
|Current installments of long-term debt               |  |                       | 577     |  |            |   | 379     |              |  |   |                                     |   |  |                            | 956     |  |              |   |       |                                   |  |   |        |   |  |   | 956     | 
|Accounts payable                                     |  |                       | 32,414  |  |            |   | 22,601  |              |  |   |                                     |   |  |                            | 55,015  |  |              |   |       |                                   |  |   |        |   |  |   | 55,015  | 
|Accrued liabilities                                  |  |                       | 17,141  |  |            |   | 5,599   |              |  |   |                                     |   |  |                            | 22,740  |  |              |   | 53     |                                   |  |   |        |   |  |   | 22,793  | 
|Income taxes payable                                 |  |                       | 4,909   |  |            |   | (2,028  | )            |  |   |                                     |   |  |                            | 2,881   |  |              |   | 216    |                                   |  |   |        |   |  |   | 3,097   | 
|Sales, use and fuel taxes payable                    |  |                       | 14,412  |  |            |   | 4,577   |              |  |   |                                     |   |  |                            | 18,989  |  |              |   |       |                                   |  |   |        |   |  |   | 18,989  | 
|Deferred revenue                                     |  |                       | 15,290  |  |            |   |        |              |  |   |                                     |   |  |                            | 15,290  |  |              |   |       |                                   |  |   | (15,290 | ) |  |   |        | 
|Deferred income taxes                                |  |                       | 7,049   |  |            |   | (1,052  | )            |  |   |                                     |   |  |                            | 5,997   |  |              |   |       |                                   |  |   |        |   |  |   | 5,997   | 
|Intercompany                                         |  |                       |        |  |            |   | 153,479 |              |  |   | (153,479                             | ) |  |                            |        |  |              |   |       |                                   |  |   |        |   |  |   |        | 
|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Total current liabilities                            |  |                       | 91,792  |  |            |   | 183,555 |              |  |   | (153,479                             | ) |  |                            | 121,868 |  |              |   | 11,169 |                                   |  |   | (15,290 | ) |  |   | 117,747 | 
|Revolving credit facility                            |  |                       | 102,000 |  |            |   |        |              |  |   |                                     |   |  |                            | 102,000 |  |              |   |       |                                   |  |   |        |   |  |   | 102,000 | 
|Long term debt: less current installments            |  |                       | 353,735 |  |            |   | 1,649   |              |  |   |                                     |   |  |                            | 355,384 |  |              |   |       |                                   |  |   |        |   |  |   | 355,384 | 
|Deferred retirement benefits                         |  |                       | 86,407  |  |            |   | 1,885   |              |  |   |                                     |   |  |                            | 88,292  |  |              |   |       |                                   |  |   |        |   |  |   | 88,292  | 
|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 
|Total liabilities                                    |  |                       | 633,934 |  |            |   | 187,089 |              |  |   | (153,479                             | ) |  |                            | 667,544 |  |              |   | 11,169 |                                   |  |   | (15,290 | ) |  |   | 663,423 | 
|                                                     |  |                       |         |  |            |   |         |              |  |   |                                      |   |  |                            |         |  |              |   |        |                                   |  |   |         |   |  |   |         | 



10



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|------------------------------------------------------------------------------------------ |  | --------------------- | ------- | - | ---------- | - | ------- | ------------ |  | - | ------------------------------------ | - |  | -------------------------- | ------- | - | ------------ | - | ------ | --------------------------------- |  | - | ------- | - |  | - | ------- | -
|                                                                                           |  | May 31, 2011          |        
|                                                                                           |  | UnitedRefiningCompany |         |   | Guarantors |   |         | Eliminations |  |   | United RefiningCompany
&Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |         |   | Eliminations |   |        | UnitedRefiningCompanyConsolidated | 
|Commitment and contingencies                                                               |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Stockholders equity                                                                       |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Common stock, $.10 par value per share  shares authorized 100; issued and outstanding 100 |  |                       |        |   |            |   | 18      |              |  |   | (18                                  | ) |  |                            |        |   |              |   |       |                                   |  |   |        |   |  |   |        |  
|Additional paid-in capital                                                                 |  |                       | 22,500  |   |            |   | 10,651  |              |  |   | (10,651                              | ) |  |                            | 22,500  |   |              |   | 15,000 |                                   |  |   | (15,000 | ) |  |   | 22,500  |  
|Retained earnings                                                                          |  |                       | 19,494  |   |            |   | (3,685  | )            |  |   | 3,685                                |   |  |                            | 19,494  |   |              |   | 311    |                                   |  |   | (311    | ) |  |   | 19,494  |  
|Accumulated other comprehensive loss                                                       |  |                       | (14,094 | ) |            |   | (1,159  | )            |  |   | 1,159                                |   |  |                            | (14,094 | ) |              |   |       |                                   |  |   |        |   |  |   | (14,094 | )
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Controlling interest equity                                                                |  |                       | 27,900  |   |            |   | 5,825   |              |  |   | (5,825                               | ) |  |                            | 27,900  |   |              |   | 15,311 |                                   |  |   | (15,311 | ) |  |   | 27,900  |  
|Non-controlling interest                                                                   |  |                       |        |   |            |   |        |              |  |   |                                     |   |  |                            |        |   |              |   |       |                                   |  |   | 15,311  |   |  |   | 15,311  |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Total stockholders equity                                                                 |  |                       | 27,900  |   |            |   | 5,825   |              |  |   | (5,825                               | ) |  |                            | 27,900  |   |              |   | 15,311 |                                   |  |   |        |   |  |   | 43,211  |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|                                                                                           |  | $                     | 661,834 |   |            | $ | 192,914 |              |  | $ | (159,304                             | ) |  | $                          | 695,444 |   |              | $ | 26,480 |                                   |  | $ | (15,290 | ) |  | $ | 706,634 |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  



11



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



Condensed Consolidating Balance Sheets

(in thousands)



|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|------------------------------------------------------------------------------------------ |  | --------------------- | ------- | - | ---------- | - | ------- | ------------ |  | - | ------------------------------------ | - |  | -------------------------- | ------- | - | ------------ | - | - | --------------------------------- |  | - | - |  |  | - | ------- | -
|                                                                                           |  | August 31, 2010       |        
|                                                                                           |  | UnitedRefiningCompany |         |   | Guarantors |   |         | Eliminations |  |   | United RefiningCompany
&Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |         |   | Eliminations |   |   | UnitedRefiningCompanyConsolidated | 
|Assets                                                                                     |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Current:                                                                                   |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Cash and cash equivalents                                                                  |  | $                     | 7,765   |   |            | $ | 9,405   |              |  | $ |                                     |   |  | $                          | 17,170  |   |              | $ |  |                                   |  | $ |  |  |  | $ | 17,170  |  
|Accounts receivable, net                                                                   |  |                       | 30,266  |   |            |   | 33,926  |              |  |   |                                     |   |  |                            | 64,192  |   |              |   |  |                                   |  |   |  |  |  |   | 64,192  |  
|Refundable income taxes                                                                    |  |                       | 37,921  |   |            |   | (1,531  | )            |  |   |                                     |   |  |                            | 36,390  |   |              |   |  |                                   |  |   |  |  |  |   | 36,390  |  
|Inventories                                                                                |  |                       | 176,748 |   |            |   | 30,090  |              |  |   |                                     |   |  |                            | 206,838 |   |              |   |  |                                   |  |   |  |  |  |   | 206,838 |  
|Prepaid expenses and other assets                                                          |  |                       | 22,461  |   |            |   | 5,480   |              |  |   |                                     |   |  |                            | 27,941  |   |              |   |  |                                   |  |   |  |  |  |   | 27,941  |  
|Amounts due from affiliated companies                                                      |  |                       | 3,455   |   |            |   | (483    | )            |  |   |                                     |   |  |                            | 2,972   |   |              |   |  |                                   |  |   |  |  |  |   | 2,972   |  
|Intercompany                                                                               |  |                       | 111,228 |   |            |   | 16,374  |              |  |   | (127,602                             | ) |  |                            |        |   |              |   |  |                                   |  |   |  |  |  |   |        |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Total current assets                                                                       |  |                       | 389,844 |   |            |   | 93,261  |              |  |   | (127,602                             | ) |  |                            | 355,503 |   |              |   |  |                                   |  |   |  |  |  |   | 355,503 |  
|Property, plant and equipment, net                                                         |  |                       | 185,349 |   |            |   | 76,426  |              |  |   |                                     |   |  |                            | 261,775 |   |              |   |  |                                   |  |   |  |  |  |   | 261,775 |  
|Deferred financing costs, net                                                              |  |                       | 2,114   |   |            |   |        |              |  |   |                                     |   |  |                            | 2,114   |   |              |   |  |                                   |  |   |  |  |  |   | 2,114   |  
|Goodwill and other non-amortizable assets                                                  |  |                       |        |   |            |   | 11,849  |              |  |   |                                     |   |  |                            | 11,849  |   |              |   |  |                                   |  |   |  |  |  |   | 11,849  |  
|Amortizable intangible assets, net                                                         |  |                       |        |   |            |   | 1,376   |              |  |   |                                     |   |  |                            | 1,376   |   |              |   |  |                                   |  |   |  |  |  |   | 1,376   |  
|Deferred turnaround costs & other assets                                                   |  |                       | 3,233   |   |            |   | 661     |              |  |   |                                     |   |  |                            | 3,894   |   |              |   |  |                                   |  |   |  |  |  |   | 3,894   |  
|Deferred income taxes                                                                      |  |                       | 7,909   |   |            |   | (7,317  | )            |  |   |                                     |   |  |                            | 592     |   |              |   |  |                                   |  |   |  |  |  |   | 592     |  
|Investment in subsidiaries                                                                 |  |                       | 9,263   |   |            |   |        |              |  |   | (9,263                               | ) |  |                            |        |   |              |   |  |                                   |  |   |  |  |  |   |        |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|                                                                                           |  | $                     | 597,712 |   |            | $ | 176,256 |              |  | $ | (136,865                             | ) |  | $                          | 637,103 |   |              | $ |  |                                   |  | $ |  |  |  | $ | 637,103 |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Liabilities and Stockholders Equity                                                       |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Current:                                                                                   |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Current installments of long-term debt                                                     |  | $                     | 1,390   |   |            | $ | 498     |              |  | $ |                                     |   |  | $                          | 1,888   |   |              | $ |  |                                   |  | $ |  |  |  | $ | 1,888   |  
|Accounts payable                                                                           |  |                       | 40,689  |   |            |   | 24,931  |              |  |   |                                     |   |  |                            | 65,620  |   |              |   |  |                                   |  |   |  |  |  |   | 65,620  |  
|Accrued liabilities                                                                        |  |                       | 9,457   |   |            |   | 6,112   |              |  |   |                                     |   |  |                            | 15,569  |   |              |   |  |                                   |  |   |  |  |  |   | 15,569  |  
|Income taxes payable                                                                       |  |                       | 196     |   |            |   | 356     |              |  |   |                                     |   |  |                            | 552     |   |              |   |  |                                   |  |   |  |  |  |   | 552     |  
|Sales, use and fuel taxes payable                                                          |  |                       | 14,461  |   |            |   | 3,994   |              |  |   |                                     |   |  |                            | 18,455  |   |              |   |  |                                   |  |   |  |  |  |   | 18,455  |  
|Deferred income taxes                                                                      |  |                       | 7,049   |   |            |   | (1,052  | )            |  |   |                                     |   |  |                            | 5,997   |   |              |   |  |                                   |  |   |  |  |  |   | 5,997   |  
|Intercompany                                                                               |  |                       |        |   |            |   | 127,602 |              |  |   | (127,602                             | ) |  |                            |        |   |              |   |  |                                   |  |   |  |  |  |   |        |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Total current liabilities                                                                  |  |                       | 73,242  |   |            |   | 162,441 |              |  |   | (127,602                             | ) |  |                            | 108,081 |   |              |   |  |                                   |  |   |  |  |  |   | 108,081 |  
|Revolving credit facility                                                                  |  |                       | 83,000  |   |            |   |        |              |  |   |                                     |   |  |                            | 83,000  |   |              |   |  |                                   |  |   |  |  |  |   | 83,000  |  
|Long term debt: less current installments                                                  |  |                       | 326,239 |   |            |   | 1,926   |              |  |   |                                     |   |  |                            | 328,165 |   |              |   |  |                                   |  |   |  |  |  |   | 328,165 |  
|Deferred retirement benefits                                                               |  |                       | 88,994  |   |            |   | 2,626   |              |  |   |                                     |   |  |                            | 91,620  |   |              |   |  |                                   |  |   |  |  |  |   | 91,620  |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Total liabilities                                                                          |  |                       | 571,475 |   |            |   | 166,993 |              |  |   | (127,602                             | ) |  |                            | 610,866 |   |              |   |  |                                   |  |   |  |  |  |   | 610,866 |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Commitment and contingencies                                                               |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Stockholders equity                                                                       |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Common stock, $.10 par value per share  shares authorized 100; issued and outstanding 100 |  |                       |        |   |            |   | 18      |              |  |   | (18                                  | ) |  |                            |        |   |              |   |  |                                   |  |   |  |  |  |   |        |  
|Additional paid-in capital                                                                 |  |                       | 22,500  |   |            |   | 10,651  |              |  |   | (10,651                              | ) |  |                            | 22,500  |   |              |   |  |                                   |  |   |  |  |  |   | 22,500  |  
|Retained earnings                                                                          |  |                       | 18,231  |   |            |   | (140    | )            |  |   | 140                                  |   |  |                            | 18,231  |   |              |   |  |                                   |  |   |  |  |  |   | 18,231  |  
|Accumulated other comprehensive loss                                                       |  |                       | (14,494 | ) |            |   | (1,266  | )            |  |   | 1,266                                |   |  |                            | (14,494 | ) |              |   |  |                                   |  |   |  |  |  |   | (14,494 | )
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Controlling interest equity                                                                |  |                       | 26,237  |   |            |   | 9,263   |              |  |   | (9,263                               | ) |  |                            | 26,237  |   |              |   |  |                                   |  |   |  |  |  |   | 26,237  |  
|Non-controlling interest                                                                   |  |                       |        |   |            |   |        |              |  |   |                                     |   |  |                            |        |   |              |   |  |                                   |  |   |  |  |  |   |        |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Total stockholders equity                                                                 |  |                       | 26,237  |   |            |   | 9,263   |              |  |   | (9,263                               | ) |  |                            | 26,237  |   |              |   |  |                                   |  |   |  |  |  |   | 26,237  |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|                                                                                           |  | $                     | 597,712 |   |            | $ | 176,256 |              |  | $ | (136,865                             | ) |  | $                          | 637,103 |   |              | $ |  |                                   |  | $ |  |  |  | $ | 637,103 |  
|                                                                                           |  |                       |         |   |            |   |         |              |  |   |                                      |   |  |                            |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  



12



---

##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



Condensed Consolidating Statements of Operations

(in thousands)



|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|---------------------------------------------------------------- |  | ------------------------------- | ------- | - | ---------- | - | ------- | ------------ |  | - | ----------------------------------- | - |  | -------------------------- | ------- | - | ------------ | - | ------ | --------------------------------- |  | - | ------- | - |  | - | ------- | -
|                                                                 |  | Three Months Ended May 31, 2011 |        
|                                                                 |  | UnitedRefiningCompany           |         |   | Guarantors |   |         | Eliminations |  |   | UnitedRefiningCompany &Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |         |   | Eliminations |   |        | UnitedRefiningCompanyConsolidated | 
|Net sales                                                        |  | $                               | 605,334 |   |            | $ | 445,692 |              |  | $ | (240,683                            | ) |  | $                          | 810,343 |   |              | $ | 23,620 |                                   |  | $ | (25,848 | ) |  | $ | 808,115 |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Costs and expenses:                                              |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Costs of goods sold (exclusive of depreciation and amortization) |  |                                 | 575,266 |   |            |   | 405,284 |              |  |   | (240,683                            | ) |  |                            | 739,867 |   |              |   | 22,949 |                                   |  |   | (25,848 | ) |  |   | 736,968 |  
|Selling, general and administrative expenses                     |  |                                 | 4,129   |   |            |   | 33,380  |              |  |   |                                    |   |  |                            | 37,509  |   |              |   | 3      |                                   |  |   |        |   |  |   | 37,512  |  
|Depreciation and amortization expenses                           |  |                                 | 3,704   |   |            |   | 1,552   |              |  |   |                                    |   |  |                            | 5,256   |   |              |   |       |                                   |  |   |        |   |  |   | 5,256   |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|                                                                 |  |                                 | 583,099 |   |            |   | 440,216 |              |  |   | (240,683                            | ) |  |                            | 782,632 |   |              |   | 22,952 |                                   |  |   | (25,848 | ) |  |   | 779,736 |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Operating income                                                 |  |                                 | 22,235  |   |            |   | 5,476   |              |  |   |                                    |   |  |                            | 27,711  |   |              |   | 668    |                                   |  |   |        |   |  |   | 28,379  |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Other income (expense):                                          |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Interest expense, net                                            |  |                                 | (11,333 | ) |            |   | (277    | )            |  |   |                                    |   |  |                            | (11,610 | ) |              |   | (151   | )                                 |  |   |        |   |  |   | (11,761 | )
|Other, net                                                       |  |                                 | (936    | ) |            |   | 278     |              |  |   |                                    |   |  |                            | (658    | ) |              |   | (147   | )                                 |  |   |        |   |  |   | (805    | )
|Loss on early extinguishment of debt                             |  |                                 | (1,245  | ) |            |   |        |              |  |   |                                    |   |  |                            | (1,245  | ) |              |   |       |                                   |  |   |        |   |  |   | (1,245  | )
|Equity in net income of subsidiaries                             |  |                                 | 2,978   |   |            |   |        |              |  |   | (2,978                              | ) |  |                            |        |   |              |   |       |                                   |  |   |        |   |  |   |        |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|                                                                 |  |                                 | (10,536 | ) |            |   | 1       |              |  |   | (2,978                              | ) |  |                            | (13,513 | ) |              |   | (298   | )                                 |  |   |        |   |  |   | (13,811 | )
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Income before income tax expense                                 |  |                                 | 11,699  |   |            |   | 5,477   |              |  |   | (2,978                              | ) |  |                            | 14,198  |   |              |   | 370    |                                   |  |   |        |   |  |   | 14,568  |  
|Income tax expense                                               |  |                                 | 2,608   |   |            |   | 2,499   |              |  |   |                                    |   |  |                            | 5,107   |   |              |   | 152    |                                   |  |   |        |   |  |   | 5,259   |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Net income                                                       |  |                                 | 9,091   |   |            |   | 2,978   |              |  |   | (2,978                              | ) |  |                            | 9,091   |   |              |   | 218    |                                   |  |   |        |   |  |   | 9,309   |  
|Less net income attributable to non-controlling interest         |  |                                 |        |   |            |   |        |              |  |   |                                    |   |  |                            |        |   |              |   |       |                                   |  |   | 218     |   |  |   | 218     |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Net income attributable to United Refining Companys Stockholder |  | $                               | 9,091   |   |            | $ | 2,978   |              |  | $ | (2,978                              | ) |  | $                          | 9,091   |   |              | $ | 218    |                                   |  | $ | (218    | ) |  | $ | 9,091   |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|                                                                 | 
|                                                                 |  | Three Months Ended May 31, 2010 |        
|                                                                 |  | UnitedRefiningCompany           |         |   | Guarantors |   |         | Eliminations |  |   | UnitedRefiningCompany &Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |         |   | Eliminations |   |        | UnitedRefiningCompanyConsolidated | 
|Net sales                                                        |  | $                               | 520,558 |   |            | $ | 355,218 |              |  | $ | (170,454                            | ) |  | $                          | 705,322 |   |              | $ |       |                                   |  | $ |        |   |  | $ | 705,322 |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Costs and expenses:                                              |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Costs of goods sold (exclusive of depreciation and amortization) |  |                                 | 524,448 |   |            |   | 320,647 |              |  |   | (170,454                            | ) |  |                            | 674,641 |   |              |   |       |                                   |  |   |        |   |  |   | 674,641 |  
|Selling, general and administrative expenses                     |  |                                 | 4,771   |   |            |   | 32,420  |              |  |   |                                    |   |  |                            | 37,191  |   |              |   |       |                                   |  |   |        |   |  |   | 37,191  |  
|Depreciation and amortization expenses                           |  |                                 | 3,973   |   |            |   | 1,494   |              |  |   |                                    |   |  |                            | 5,467   |   |              |   |       |                                   |  |   |        |   |  |   | 5,467   |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|                                                                 |  |                                 | 533,192 |   |            |   | 354,561 |              |  |   | (170,454                            | ) |  |                            | 717,299 |   |              |   |       |                                   |  |   |        |   |  |   | 717,299 |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Operating (loss) income                                          |  |                                 | (12,634 | ) |            |   | 657     |              |  |   |                                    |   |  |                            | (11,977 | ) |              |   |       |                                   |  |   |        |   |  |   | (11,977 | )
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Other income (expense):                                          |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Interest expense, net                                            |  |                                 | (8,676  | ) |            |   | (307    | )            |  |   |                                    |   |  |                            | (8,983  | ) |              |   |       |                                   |  |   |        |   |  |   | (8,983  | )
|Other, net                                                       |  |                                 | (842    | ) |            |   | 222     |              |  |   |                                    |   |  |                            | (620    | ) |              |   |       |                                   |  |   |        |   |  |   | (620    | )
|Equity in net loss of subsidiaries                               |  |                                 | (2,805  | ) |            |   |        |              |  |   | 2,805                               |   |  |                            |        |   |              |   |       |                                   |  |   |        |   |  |   |        |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|                                                                 |  |                                 | (12,323 | ) |            |   | (85     | )            |  |   | 2,805                               |   |  |                            | (9,603  | ) |              |   |       |                                   |  |   |        |   |  |   | (9,603  | )
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|(Loss) income before income tax (benefit) expense                |  |                                 | (24,957 | ) |            |   | 572     |              |  |   | 2,805                               |   |  |                            | (21,580 | ) |              |   |       |                                   |  |   |        |   |  |   | (21,580 | )
|Income tax (benefit) expense                                     |  |                                 | (8,105  | ) |            |   | 3,377   |              |  |   |                                    |   |  |                            | (4,728  | ) |              |   |       |                                   |  |   |        |   |  |   | (4,728  | )
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Net loss                                                         |  |                                 | (16,852 | ) |            |   | (2,805  | )            |  |   | 2,805                               |   |  |                            | (16,852 | ) |              |   |       |                                   |  |   |        |   |  |   | (16,852 | )
|Less net income attributable to non-controlling interest         |  |                                 |        |   |            |   |        |              |  |   |                                    |   |  |                            |        |   |              |   |       |                                   |  |   |        |   |  |   |        |  
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  
|Net loss attributable to United Refining Companys Stockholder   |  | $                               | (16,852 | ) |            | $ | (2,805  | )            |  | $ | 2,805                               |   |  | $                          | (16,852 | ) |              | $ |       |                                   |  | $ |        |   |  | $ | (16,852 | )
|                                                                 |  |                                 |         |   |            |   |         |              |  |   |                                     |   |  |                            |         |   |              |   |        |                                   |  |   |         |   |  |   |         |  



13



---

##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



Condensed Consolidating Statements of Operations

(in thousands)



|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|----------------------------------------------------------------------- |  | ------------------------------ | --------- | - | ---------- | - | --------- | ------------ |  | - | ----------------------------------- | - |  | -------------------------- | --------- | - | ------------ | - | ------ | --------------------------------- |  | - | ------- | - |  | - | --------- | -
|                                                                        |  | Nine Months Ended May 31, 2011 |          
|                                                                        |  | UnitedRefiningCompany          |           |   | Guarantors |   |           | Eliminations |  |   | UnitedRefiningCompany &Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |           |   | Eliminations |   |        | UnitedRefiningCompanyConsolidated | 
|Net sales                                                               |  | $                              | 1,569,734 |   |            | $ | 1,163,498 |              |  | $ | (611,718                            | ) |  | $                          | 2,121,514 |   |              | $ | 23,875 |                                   |  | $ | (25,848 | ) |  | $ | 2,119,541 |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Costs and expenses:                                                     |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Costs of goods sold (exclusive of depreciation and amortization)        |  |                                | 1,506,148 |   |            |   | 1,066,115 |              |  |   | (611,718                            | ) |  |                            | 1,960,545 |   |              |   | 22,949 |                                   |  |   | (25,848 | ) |  |   | 1,957,646 |  
|Selling, general and administrative expenses                            |  |                                | 12,701    |   |            |   | 97,411    |              |  |   |                                    |   |  |                            | 110,112   |   |              |   | 5      |                                   |  |   |        |   |  |   | 110,117   |  
|Depreciation and amortization expenses                                  |  |                                | 11,519    |   |            |   | 4,724     |              |  |   |                                    |   |  |                            | 16,243    |   |              |   |       |                                   |  |   |        |   |  |   | 16,243    |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|                                                                        |  |                                | 1,530,368 |   |            |   | 1,168,250 |              |  |   | (611,718                            | ) |  |                            | 2,086,900 |   |              |   | 22,954 |                                   |  |   | (25,848 | ) |  |   | 2,084,006 |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Operating income (loss)                                                 |  |                                | 39,366    |   |            |   | (4,752    | )            |  |   |                                    |   |  |                            | 34,614    |   |              |   | 921    |                                   |  |   |        |   |  |   | 35,535    |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Other income (expense):                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Interest expense, net                                                   |  |                                | (28,707   | ) |            |   | (690      | )            |  |   |                                    |   |  |                            | (29,397   | ) |              |   | (173   | )                                 |  |   |        |   |  |   | (29,570   | )
|Other, net                                                              |  |                                | (2,656    | ) |            |   | 681       |              |  |   |                                    |   |  |                            | (1,975    | ) |              |   | (221   | )                                 |  |   |        |   |  |   | (2,196    | )
|Loss on early extinguishment of debt                                    |  |                                | (1,245    | ) |            |   |          |              |  |   |                                    |   |  |                            | (1,245    | ) |              |   |       |                                   |  |   |        |   |  |   | (1,245    | )
|Equity in net loss of subsidiaries                                      |  |                                | (3,546    | ) |            |   |          |              |  |   | 3,546                               |   |  |                            |          |   |              |   |       |                                   |  |   |        |   |  |   |          |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|                                                                        |  |                                | (36,154   | ) |            |   | (9        | )            |  |   | 3,546                               |   |  |                            | (32,617   | ) |              |   | (394   | )                                 |  |   |        |   |  |   | (33,011   | )
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Income (loss) before income tax expense (benefit)                       |  |                                | 3,212     |   |            |   | (4,761    | )            |  |   | 3,546                               |   |  |                            | 1,997     |   |              |   | 527    |                                   |  |   |        |   |  |   | 2,524     |  
|Income tax expense (benefit)                                            |  |                                | 1,949     |   |            |   | (1,215    | )            |  |   |                                    |   |  |                            | 734       |   |              |   | 216    |                                   |  |   |        |   |  |   | 950       |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Net income (loss)                                                       |  |                                | 1,263     |   |            |   | (3,546    | )            |  |   | 3,546                               |   |  |                            | 1,263     |   |              |   | 311    |                                   |  |   |        |   |  |   | 1,574     |  
|Less net income attributable to non-controlling interest                |  |                                |          |   |            |   |          |              |  |   |                                    |   |  |                            |          |   |              |   |       |                                   |  |   | 311     |   |  |   | 311       |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  
|Net income (loss) attributable to United Refining Companys Stockholder |  | $                              | 1,263     |   |            | $ | (3,546    | )            |  | $ | 3,546                               |   |  | $                          | 1,263     |   |              | $ | 311    |                                   |  | $ | (311    | ) |  | $ | 1,263     |  
|                                                                        |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |        |                                   |  |   |         |   |  |   |           |  



|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|---------------------------------------------------------------- |  | ------------------------------ | --------- | - | ---------- | - | --------- | ------------ |  | - | ----------------------------------- | - |  | -------------------------- | --------- | - | ------------ | - | - | --------------------------------- |  | - | - |  |  | - | --------- | -
|                                                                 |  | Nine Months Ended May 31, 2010 |          
|                                                                 |  | UnitedRefiningCompany          |           |   | Guarantors |   |           | Eliminations |  |   | UnitedRefiningCompany &Subsidiaries |   |  | UnitedRefiningAsphalt, Inc |           |   | Eliminations |   |   | UnitedRefiningCompanyConsolidated | 
|Net sales                                                        |  | $                              | 1,390,833 |   |            | $ | 999,659   |              |  | $ | (469,496                            | ) |  | $                          | 1,920,996 |   |              | $ |  |                                   |  | $ |  |  |  | $ | 1,920,996 |  
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Costs and expenses:                                              |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Costs of goods sold (exclusive of depreciation and amortization) |  |                                | 1,430,586 |   |            |   | 901,513   |              |  |   | (469,496                            | ) |  |                            | 1,862,603 |   |              |   |  |                                   |  |   |  |  |  |   | 1,862,603 |  
|Selling, general and administrative expenses                     |  |                                | 16,476    |   |            |   | 95,158    |              |  |   |                                    |   |  |                            | 111,634   |   |              |   |  |                                   |  |   |  |  |  |   | 111,634   |  
|Depreciation and amortization expenses                           |  |                                | 11,918    |   |            |   | 4,517     |              |  |   |                                    |   |  |                            | 16,435    |   |              |   |  |                                   |  |   |  |  |  |   | 16,435    |  
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|                                                                 |  |                                | 1,458,980 |   |            |   | 1,001,188 |              |  |   | (469,496                            | ) |  |                            | 1,990,672 |   |              |   |  |                                   |  |   |  |  |  |   | 1,990,672 |  
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Operating loss                                                   |  |                                | (68,147   | ) |            |   | (1,529    | )            |  |   |                                    |   |  |                            | (69,676   | ) |              |   |  |                                   |  |   |  |  |  |   | (69,676   | )
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Other income (expense):                                          |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Interest expense, net                                            |  |                                | (25,200   | ) |            |   | (962      | )            |  |   |                                    |   |  |                            | (26,162   | ) |              |   |  |                                   |  |   |  |  |  |   | (26,162   | )
|Other, net                                                       |  |                                | (2,326    | ) |            |   | 894       |              |  |   |                                    |   |  |                            | (1,432    | ) |              |   |  |                                   |  |   |  |  |  |   | (1,432    | )
|Equity in net loss of subsidiaries                               |  |                                | (4,105    | ) |            |   |          |              |  |   | 4,105                               |   |  |                            |          |   |              |   |  |                                   |  |   |  |  |  |   |          |  
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|                                                                 |  |                                | (31,631   | ) |            |   | (68       | )            |  |   | 4,105                               |   |  |                            | (27,594   | ) |              |   |  |                                   |  |   |  |  |  |   | (27,594   | )
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Loss before income tax (benefit) expense                         |  |                                | (99,778   | ) |            |   | (1,597    | )            |  |   | 4,105                               |   |  |                            | (97,270   | ) |              |   |  |                                   |  |   |  |  |  |   | (97,270   | )
|Income tax (benefit) expense                                     |  |                                | (38,271   | ) |            |   | 2,508     |              |  |   |                                    |   |  |                            | (35,763   | ) |              |   |  |                                   |  |   |  |  |  |   | (35,763   | )
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Net loss                                                         |  |                                | (61,507   | ) |            |   | (4,105    | )            |  |   | 4,105                               |   |  |                            | (61,507   | ) |              |   |  |                                   |  |   |  |  |  |   | (61,507   | )
|Less net income attributable to non-controlling interest         |  |                                |          |   |            |   |          |              |  |   |                                    |   |  |                            |          |   |              |   |  |                                   |  |   |  |  |  |   |          |  
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  
|Net loss attributable to United Refining Companys Stockholder   |  | $                              | (61,507   | ) |            | $ | (4,105    | )            |  | $ | 4,105                               |   |  | $                          | (61,507   | ) |              | $ |  |                                   |  | $ |  |  |  | $ | (61,507   | )
|                                                                 |  |                                |           |   |            |   |           |              |  |   |                                     |   |  |                            |           |   |              |   |   |                                   |  |   |   |  |  |   |           |  



14



---

##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



Condensed Consolidating Statements of Cash Flows

(in thousands)



|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|------------------------------------------------------------------ |  | ------------------------------ | -------- | - | ---------- | - | ------ | ------------ |  | - | ----------------------------------- |  |  | -------------------------- | -------- | - | ------------ | - | ------- | --------------------------------- |  | - | - |  |  | - | -------- | -
|                                                                   |  | Nine Months Ended May 31, 2011 |         
|                                                                   |  | UnitedRefiningCompany          |          |   | Guarantors |   |        | Eliminations |  |   | UnitedRefiningCompany &Subsidiaries |  |  | UnitedRefiningAsphalt, Inc |          |   | Eliminations |   |         | UnitedRefiningCompanyConsolidated | 
|Net cash provided by (used in) by operating activities             |  | $                              | 1,950    |   |            | $ | 9,369  |              |  | $ |                                    |  |  | $                          | 11,319   |   |              | $ | (24,512 | )                                 |  | $ |  |  |  | $ | (13,193  | )
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Cash flows from investing activities:                              |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Additions to property, plant and equipment                         |  |                                | (19,544  | ) |            |   | (3,634 | )            |  |   |                                    |  |  |                            | (23,178  | ) |              |   |        |                                   |  |   |  |  |  |   | (23,178  | )
|Additions to deferred turnaround costs                             |  |                                | (14,702  | ) |            |   |       |              |  |   |                                    |  |  |                            | (14,702  | ) |              |   |        |                                   |  |   |  |  |  |   | (14,702  | )
|Proceeds from asset dispositions                                   |  |                                | 56       |   |            |   | 1      |              |  |   |                                    |  |  |                            | 57       |   |              |   |        |                                   |  |   |  |  |  |   | 57       |  
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Net cash used in investing activities                              |  |                                | (34,190  | ) |            |   | (3,633 | )            |  |   |                                    |  |  |                            | (37,823  | ) |              |   |        |                                   |  |   |  |  |  |   | (37,823  | )
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Cash flows from financing activities:                              |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Net borrowings on revolving credit facilities                      |  |                                | 19,000   |   |            |   |       |              |  |   |                                    |  |  |                            | 19,000   |   |              |   | 10,900  |                                   |  |   |  |  |  |   | 29,900   |  
|Proceeds from issuance of common stock of non-controlling interest |  |                                |         |   |            |   |       |              |  |   |                                    |  |  |                            |         |   |              |   | 15,000  |                                   |  |   |  |  |  |   | 15,000   |  
|Proceeds from issuance of long term debt                           |  |                                | 352,021  |   |            |   |       |              |  |   |                                    |  |  |                            | 352,021  |   |              |   |        |                                   |  |   |  |  |  |   | 352,021  |  
|Principal reductions of long-term debt                             |  |                                | (324,413 | ) |            |   | (396   | )            |  |   |                                    |  |  |                            | (324,809 | ) |              |   |        |                                   |  |   |  |  |  |   | (324,809 | )
|Deferred financing costs                                           |  |                                | (10,141  | ) |            |   |       |              |  |   |                                    |  |  |                            | (10,141  | ) |              |   | (415    | )                                 |  |   |  |  |  |   | (10,556  | )
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Net cash provided by (used in) financing activities                |  |                                | 36,467   |   |            |   | (396   | )            |  |   |                                    |  |  |                            | 36,071   |   |              |   | 25,485  |                                   |  |   |  |  |  |   | 61,556   |  
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Net increase in cash and cash equivalents                          |  |                                | 4,227    |   |            |   | 5,340  |              |  |   |                                    |  |  |                            | 9,567    |   |              |   | 973     |                                   |  |   |  |  |  |   | 10,540   |  
|Cash and cash equivalents, beginning of year                       |  |                                | 7,765    |   |            |   | 9,405  |              |  |   |                                    |  |  |                            | 17,170   |   |              |   |        |                                   |  |   |  |  |  |   | 17,170   |  
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  
|Cash and cash equivalents, end of period                           |  | $                              | 11,992   |   |            | $ | 14,745 |              |  | $ |                                    |  |  | $                          | 26,737   |   |              | $ | 973     |                                   |  | $ |  |  |  | $ | 27,710   |  
|                                                                   |  |                                |          |   |            |   |        |              |  |   |                                     |  |  |                            |          |   |              |   |         |                                   |  |   |   |  |  |   |          |  



|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|---------------------------------------------------- |  | ------------------------------ | ------- | - | ---------- | - | ------ | ------------ |  | - | ---------------------------------- |  |  | ------------------------- | ------- | - | ------------ | - | - | --------------------------------- |  | - | - |  |  | - | ------- | -
|                                                     |  | Nine Months Ended May 31, 2010 |        
|                                                     |  | UnitedRefiningCompany          |         |   | Guarantors |   |        | Eliminations |  |   | UnitedRefiningCompany&Subsidiaries |  |  | UnitedRefiningAsphalt,Inc |         |   | Eliminations |   |   | UnitedRefiningCompanyConsolidated | 
|Net cash (used in) provided by operating activities  |  | $                              | (91,725 | ) |            | $ | 13,907 |              |  | $ |                                   |  |  | $                         | (77,818 | ) |              | $ |  |                                   |  | $ |  |  |  | $ | (77,818 | )
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Cash flows from investing activities:                |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Additions to property, plant and equipment           |  |                                | (15,116 | ) |            |   | (4,443 | )            |  |   |                                   |  |  |                           | (19,559 | ) |              |   |  |                                   |  |   |  |  |  |   | (19,559 | )
|Additions to deferred turnaround costs               |  |                                | (1,009  | ) |            |   | (51    | )            |  |   |                                   |  |  |                           | (1,060  | ) |              |   |  |                                   |  |   |  |  |  |   | (1,060  | )
|Proceeds from asset dispositions                     |  |                                | 25      |   |            |   |       |              |  |   |                                   |  |  |                           | 25      |   |              |   |  |                                   |  |   |  |  |  |   | 25      |  
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Net cash used in investing activities                |  |                                | (16,100 | ) |            |   | (4,494 | )            |  |   |                                   |  |  |                           | (20,594 | ) |              |   |  |                                   |  |   |  |  |  |   | (20,594 | )
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Cash flows from financing activities:                |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Net borrowings on revolving credit facility          |  |                                | 93,000  |   |            |   |       |              |  |   |                                   |  |  |                           | 93,000  |   |              |   |  |                                   |  |   |  |  |  |   | 93,000  |  
|Principal reductions of long-term debt               |  |                                | (513    | ) |            |   | (777   | )            |  |   |                                   |  |  |                           | (1,290  | ) |              |   |  |                                   |  |   |  |  |  |   | (1,290  | )
|Deferred financing costs                             |  |                                | (10     | ) |            |   |       |              |  |   |                                   |  |  |                           | (10     | ) |              |   |  |                                   |  |   |  |  |  |   | (10     | )
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Net cash provided by (used in) financing activities  |  |                                | 92,477  |   |            |   | (777   | )            |  |   |                                   |  |  |                           | 91,700  |   |              |   |  |                                   |  |   |  |  |  |   | 91,700  |  
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Net (decrease) increase in cash and cash equivalents |  |                                | (15,348 | ) |            |   | 8,636  |              |  |   |                                   |  |  |                           | (6,712  | ) |              |   |  |                                   |  |   |  |  |  |   | (6,712  | )
|Cash and cash equivalents, beginning of year         |  |                                | 21,265  |   |            |   | 9,797  |              |  |   |                                   |  |  |                           | 31,062  |   |              |   |  |                                   |  |   |  |  |  |   | 31,062  |  
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  
|Cash and cash equivalents, end of period             |  | $                              | 5,917   |   |            | $ | 18,433 |              |  | $ |                                   |  |  | $                         | 24,350  |   |              | $ |  |                                   |  | $ |  |  |  | $ | 24,350  |  
|                                                     |  |                                |         |   |            |   |        |              |  |   |                                    |  |  |                           |         |   |              |   |   |                                   |  |   |   |  |  |   |         |  



15



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



|7. | Segments of Business
|-- | --------------------



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



|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|----------------------------- |  | ------------------------- | ------- |  | ------------------------ | - | ------- | ---- |  | - | --------- | - |  | - | --------- | -
|                              |  | Three Months EndedMay 31, |         |  | Nine Months
EndedMay 31, |  
|                              |  | 2011                      |         |  | 2010                     |   |         | 2011 |  |   | 2010      |  
|Net Sales                     |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Retail                        |  | $                         | 444,800 |  |                          | $ | 354,064 |      |  | $ | 1,160,800 |   |  | $ | 996,382   |  
|Wholesale                     |  |                           | 363,315 |  |                          |   | 351,258 |      |  |   | 958,741   |   |  |   | 924,614   |  
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|                              |  | $                         | 808,115 |  |                          | $ | 705,322 |      |  | $ | 2,119,541 |   |  | $ | 1,920,996 |  
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Intersegment Sales            |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Wholesale                     |  | $                         | 239,791 |  |                          | $ | 169,300 |      |  | $ | 609,020   |   |  | $ | 466,219   |  
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Operating Income (Loss)       |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Retail                        |  | $                         | 4,078   |  |                          | $ | 988     |      |  | $ | (6,274    | ) |  | $ | (1,333    | )
|Wholesale                     |  |                           | 24,301  |  |                          |   | (12,965 | )    |  |   | 41,809    |   |  |   | (68,343   | )
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|                              |  | $                         | 28,379  |  |                          | $ | (11,977 | )    |  | $ | 35,535    |   |  | $ | (69,676   | )
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Depreciation and Amortization |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|Retail                        |  | $                         | 1,380   |  |                          | $ | 1,314   |      |  | $ | 4,207     |   |  | $ | 3,976     |  
|Wholesale                     |  |                           | 3,876   |  |                          |   | 4,153   |      |  |   | 12,036    |   |  |   | 12,459    |  
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  
|                              |  | $                         | 5,256   |  |                          | $ | 5,467   |      |  | $ | 16,243    |   |  | $ | 16,435    |  
|                              |  |                           |         |  |                          |   |         |      |  |   |           |   |  |   |           |  



|                                          |  |              |         |  |                 |   |         | 
|----------------------------------------- |  | ------------ | ------- |  | --------------- | - | ------- | 
|                                          |  | May 31, 2011 |         |  | August 31, 2010 |  
|Total Assets                              |  |              |         |  |                 |   |         | 
|Retail                                    |  | $            | 162,431 |  |                 | $ | 146,932 | 
|Wholesale                                 |  |              | 544,203 |  |                 |   | 490,171 | 
|                                          |  |              |         |  |                 |   |         | 
|                                          |  | $            | 706,634 |  |                 | $ | 637,103 | 
|                                          |  |              |         |  |                 |   |         | 
|Capital Expenditures (including non-cash) |  |              |         |  |                 |   |         | 
|Retail                                    |  | $            | 3,197   |  |                 | $ | 5,180   | 
|Wholesale                                 |  |              | 20,193  |  |                 |   | 22,233  | 
|                                          |  |              |         |  |                 |   |         | 
|                                          |  | $            | 23,390  |  |                 | $ | 27,413  | 
|                                          |  |              |         |  |                 |   |         | 



16



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##### Table of Contents

UNITED REFINING COMPANY AND SUBSIDIARIES



Notes to Consolidated Financial
Statements(Continued)

(Unaudited)



|8. | Employee Benefit Plans
|-- | ----------------------



For the periods ended May 31, 2011 and 2010, net pension and other postretirement benefit costs were comprised of the
following:



|                                      |  |                           |        |   |                          |   |        |      |  |   |        |   |  |   |        |  
|------------------------------------- |  | ------------------------- | ------ | - | ------------------------ | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                      |  | Pension Benefits          |       
|                                      |  | Three Months EndedMay 31, |        |   | Nine Months EndedMay 31, |  
|                                      |  | 2011                      |        |   | 2010                     |   |        | 2011 |  |   | 2010   |  
|                                      |  | (in thousands)            |       
|Service cost                          |  | $                         | 447    |   |                          | $ | 918    |      |  | $ | 1,342  |   |  | $ | 2,724  |  
|Interest cost on benefit obligation   |  |                           | 1,245  |   |                          |   | 1,481  |      |  |   | 3,734  |   |  |   | 4,397  |  
|Expected return on plan assets        |  |                           | (1,135 | ) |                          |   | (1,016 | )    |  |   | (3,405 | ) |  |   | (3,016 | )
|Amortization and deferral of net loss |  |                           | 508    |   |                          |   | 850    |      |  |   | 1,523  |   |  |   | 2,594  |  
|                                      |  |                           |        |   |                          |   |        |      |  |   |        |   |  |   |        |  
|Net periodic benefit cost             |  | $                         | 1,065  |   |                          | $ | 2,233  |      |  | $ | 3,194  |   |  | $ | 6,699  |  
|                                      |  |                           |        |   |                          |   |        |      |  |   |        |   |  |   |        |  



|                                      |  |                                |      |   |                          |   |       |      |  |   |       |   |  |   |       | 
|------------------------------------- |  | ------------------------------ | ---- | - | ------------------------ | - | ----- | ---- |  | - | ----- | - |  | - | ----- | 
|                                      |  | Other Post-Retirement Benefits |     
|                                      |  | Three Months EndedMay 31,      |      |   | Nine Months EndedMay 31, |  
|                                      |  | 2011                           |      |   | 2010                     |   |       | 2011 |  |   | 2010  |  
|                                      |  | (in thousands)                 |     
|Service cost                          |  | $                              | 377  |   |                          | $ | 892   |      |  | $ | 1,131 |   |  | $ | 2,624 | 
|Interest cost on benefit obligation   |  |                                | 630  |   |                          |   | 1,257 |      |  |   | 1,889 |   |  |   | 3,702 | 
|Amortization of transition obligation |  |                                |     |   |                          |   |      |      |  |   |      |   |  |   | 149   | 
|Amortization and deferral of net loss |  |                                | (282 | ) |                          |   | 488   |      |  |   | (846  | ) |  |   | 1,436 | 
|                                      |  |                                |      |   |                          |   |       |      |  |   |       |   |  |   |       | 
|Net periodic benefit cost             |  | $                              | 725  |   |                          | $ | 2,637 |      |  | $ | 2,174 |   |  | $ | 7,911 | 
|                                      |  |                                |      |   |                          |   |       |      |  |   |       |   |  |   |       | 



As of
May 31, 2011, $5,390,000 of contributions have been made to the Company pension plans for the fiscal year ending August 31, 2011.



|9. | Fair Value Measurements
|-- | -----------------------



The carrying values of all financial instruments classified as a current asset or current liability approximate fair value
because of the short maturity of these instruments. The fair value of marketable securities is determined by available market prices. The fair value exceeded (was less than) the carrying value of the notes at May 31, 2011 and August 31,
2010 by $5,622,000 and ($29,846,000), respectively.



|10. | Subsequent Events
|--- | -----------------



The URA credit facility with Bank of America, N.A., acting as the Agent bank (Agent Bank) is secured by
URAs cash accounts, accounts receivable and inventory. The applicable margin under the facility is: (a) for base rate borrowings the Agent Banks prime rate plus an applicable margin of 2.75%; (b) for euro-rate based borrowings,
at the LIBOR Rate plus an applicable margin of 3.75%. The Agent Banks prime rate at May 31, 2011 was 3.25%. The $30 million facility is due to expire September 30, 2011.



As of June 14, 2011 the URA credit facility was paid in full. As of June 21, 2011 the
$15.0 million advance from URAs parent URI was paid in full, all URA inventory was liquidated and all URA sales were completed. URA has terminated its credit facility as of the close of business on June 28, 2011.





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##### Table of Contents

|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations.
|------- | --------------------------------------------------------------------------------------



Forward Looking Statements



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



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



Although we believe our expectations are based on reasonable assumptions within the bounds of its knowledge, investors and prospective investors are cautioned that such statements are only projections and
that actual events or results may differ materially depending on a variety of factors described in greater detail in the Companys filings with the SEC, including quarterly reports on Form 10-Q, annual reports on Form 10-K, reports on Form 8-K,
etc. In addition to the factors discussed elsewhere in this Quarterly Report on Form 10-Q, the Companys actual consolidated quarterly or annual operating results have been affected in the past, or could be affected in the future, by additional
factors, including, without limitation:



| |  |  | the demand for and supply of crude oil and refined products;
| | - |  | ------------------------------------------------------------



| |  |  | the spread between market prices for refined products and market prices for crude oil;
| | - |  | --------------------------------------------------------------------------------------



| |  |  | repayment of debt;
| | - |  | ------------------



| |  |  | general economic, business and market conditions;
| | - |  | -------------------------------------------------



| |  |  | risks and uncertainties with respect to the actions of actual or potential competitive suppliers of refined petroleum products in our markets;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the possibility of inefficiencies or shutdowns in refinery operations or pipelines;
| | - |  | -----------------------------------------------------------------------------------



| |  |  | the availability and cost of financing to us;
| | - |  | ---------------------------------------------



| |  |  | environmental, tax and tobacco legislation or regulation;
| | - |  | ---------------------------------------------------------



| |  |  | volatility of gasoline prices, margins and supplies;
| | - |  | ----------------------------------------------------



| |  |  | merchandising margins;
| | - |  | ----------------------



| |  |  | labor costs;
| | - |  | ------------



| |  |  | level of capital expenditures;
| | - |  | ------------------------------



| |  |  | customer traffic;
| | - |  | -----------------



| |  |  | weather conditions;
| | - |  | -------------------



| |  |  | acts of terrorism and war;
| | - |  | --------------------------



| |  |  | business strategies;
| | - |  | --------------------



| |  |  | expansion and growth of operations;
| | - |  | -----------------------------------



| |  |  | future projects and investments;
| | - |  | --------------------------------



18



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##### Table of Contents

| |  |  | future exposure to currency devaluations or exchange rate fluctuations;
| | - |  | -----------------------------------------------------------------------



| |  |  | expected outcomes of legal and administrative proceedings and their expected effects on our financial position, results of operations and cash
flows; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | future operating results and financial condition.
| | - |  | -------------------------------------------------



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



Recent Developments



The Company continues to be impacted by the
extreme volatility of daily pricing changes in the petroleum market in fiscal year 2011. Average crude prices for the fourth quarter of fiscal year 2011 have fallen as compared to the third quarter of fiscal year 2011. The average NYMEX price for
crude oil for the fourth quarter of fiscal year 2011 was $97.53 per barrel as measured on July 1, 2011, a $3.39 decrease over the third quarter average of $100.92 per barrel.



The lagged 3-2-1 crackspread for the fourth
fiscal quarter of 2011, as measured by the difference between the price of crude oil contracts traded on the NYMEX for the proceeding month to the prices for NYMEX gasoline and heating oil contracts in the current trading month, has decreased as
compared to the third quarter of fiscal year 2011. The lagged 3-2-1 crackspread for the fourth quarter of fiscal 2011 as measured on July 1, 2011, was $26.33 as compared to $29.45 for the third fiscal quarter of 2011, a $3.12 or 11% reduction.



On July 26, 2010, a rupture
occurred in Line 6B pipeline on Enbridges Lakehead system in Michigan. The Companys heavy crude oil purchases are shipped on Line 6B from western Canada. As a result, the Company was forced to reduce production in its crude processing
unit until such time as the Enbridge Line 6B could be repaired and returned to normal service. As a result of the pipeline rupture, the Company filed a claim with its insurance carriers under its property insurance coverage which contains a
provision for contingent business interruption in the maximum amount of $15 million plus up to $5 million towards expenses. The Company is currently in discussions with its insurance carriers to settle the claim. The Company intends to seek
restitution from Enbridge for all of the losses that the Company incurred above any payments it receives from its insurance carriers.



Results of Operations



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



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



A discussion and analysis of the factors contributing to the Companys results of operations are presented below. The
accompanying Consolidated Financial Statements and related Notes, together with the following information, are intended to supply investors with a reasonable basis for evaluating the Companys operations, but should not serve as the only
criteria for predicting the Companys future performance.



19



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##### Table of Contents

Retail Operations:



|                                             |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |         |  
|-------------------------------------------- |  | ------------------------- | ------- | - | ------------------------ | - | ------- | ---- |  | - | --------- | - |  | - | ------- | -
|                                             |  | Three Months EndedMay 31, |         |   | Nine Months EndedMay 31, |  
|                                             |  | 2011                      |         |   | 2010                     |   |         | 2011 |  |   | 2010      |  
|                                             |  | (dollars in thousands)    |        
|Net Sales                                    |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |         |  
|Petroleum                                    |  | $                         | 380,032 |   |                          | $ | 288,066 |      |  | $ | 971,733   |   |  | $ | 809,509 |  
|Merchandise and other                        |  |                           | 64,768  |   |                          |   | 65,998  |      |  |   | 189,067   |   |  |   | 186,873 |  
|                                             |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |         |  
|Total Net Sales                              |  |                           | 444,800 |   |                          |   | 354,064 |      |  |   | 1,160,800 |   |  |   | 996,382 |  
|Costs of goods sold                          |  |                           | 406,067 |   |                          |   | 319,512 |      |  |   | 1,065,794 |   |  |   | 899,131 |  
|Selling, general and administrative expenses |  |                           | 33,275  |   |                          |   | 32,250  |      |  |   | 97,073    |   |  |   | 94,608  |  
|Depreciation and amortization expenses       |  |                           | 1,380   |   |                          |   | 1,314   |      |  |   | 4,207     |   |  |   | 3,976   |  
|                                             |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |         |  
|Segment Operating (Loss) Income              |  | $                         | 4,078   |   |                          | $ | 988     |      |  | $ | (6,274    | ) |  | $ | (1,333  | )
|                                             |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |         |  
|Retail Operating Data:                       |  |                           |         |   |                          |   |         |      |  |   |           |   |  |   |         |  
|Petroleum sales (thousands of gallons)       |  |                           | 99,042  |   |                          |   | 98,424  |      |  |   | 292,543   |   |  |   | 289,850 |  
|Petroleum margin (a)                         |  | $                         | 22,257  |   |                          | $ | 17,804  |      |  | $ | 47,032    |   |  | $ | 50,012  |  
|Petroleum margin ($/gallon) (b)              |  |                           | .2247   |   |                          |   | .1809   |      |  |   | .1608     |   |  |   | .1725   |  
|Merchandise and other margins                |  | $                         | 16,476  |   |                          | $ | 16,750  |      |  | $ | 47,974    |   |  | $ | 47,239  |  
|Merchandise margin (percent of sales)        |  |                           | 25.4    | % |                          |   | 25.4    | %    |  |   | 25.4      | % |  |   | 25.3    | %



|(a) | Includes the effect of intersegment purchases from the Companys wholesale segment at prices which approximate market.
|--- | ----------------------------------------------------------------------------------------------------------------------

|(b) | Company management calculates petroleum margin per gallon by dividing petroleum gross margin by petroleum sales volumes. Management uses fuel margin
per gallon calculations to compare profitability to other companies in the industry. Petroleum margin per gallon may not be comparable to similarly titled measures used by other companies in the industry.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Comparison of Fiscal Quarters Ended May 31, 2011 and
2010



Net Sales



Retail sales increased during the fiscal
quarter ended May 31, 2011 by $90.7 million or 25.6% for the comparable period in fiscal 2010 from $354.1 million to $444.8 million. The increase was primarily due to $92.0 million in petroleum sales offset by a decrease of $1.3 million in
merchandise sales. The petroleum sales increase resulted from a 31.1% increase in retail selling prices per gallon, and a .6 million gallon or .6% increase in retail petroleum volume. The merchandise sales decrease is primarily due to a
decrease in beverage sales due to inclement weather and cigarette sales primarily in New York State as a result of higher taxes and selling prices.



Costs of Goods Sold



Retail costs of goods sold increased during the fiscal quarter ended May 31, 2011 by $86.6 million or 27.1% for the
comparable period in fiscal 2010 from $319.5 million to $406.1 million. The increase was primarily due to $85.4 million in petroleum purchase prices, fuel tax of $2.1 million, offset by a decrease in merchandise cost of $.9 million.



20



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##### Table of Contents

Selling, General and Administrative Expenses



Retail Selling, General and Administrative
(SG&A) expenses increased during the fiscal quarter ended May 31, 2011 by $1.0 million or 3.2% for the comparable period in fiscal 2010 from $32.3 million to $33.3 million. The increase was primarily due to payroll costs of $.2
million, credit/customer service costs of $1.1 million and legal/professional fees of $.1 million, offset by a reduction in pension/post retirement costs of $.4 million. The decrease was primarily due to changes made in pension/post retirement
benefits. Effective September 1, 2010, postretirement medical benefits for new hires and active salaried employees retiring after September 1, 2010 were eliminated. Additionally, effective January 1, 2011, deductibles and
co-payments were added to the medical benefits plan for all plan participants. For salaried employees meeting certain age and service requirements, the Company will contribute a defined dollar amount towards the cost of retiree healthcare
based upon the employees length of service. Similarly, effective September 1, 2010, benefits under the Companys defined benefit pension plan were frozen for all salaried employees, including the Companys Chief
Executive Officer and Chief Financial Officer. The Company will provide an enhanced contribution under its defined contribution 401(k) plan for all eligible employees as well as a transition contribution for older employees.



Comparison of Nine Months Ended May 31,
2011 and 2010



Net Sales



Retail sales increased during the nine
months ended May 31, 2011 by $164.4 million or 16.5% for the comparable period in fiscal 2010 from $996.4 million to $1,160.8 million. The increase was primarily due to $162.2 million in petroleum sales, and $2.2 million in merchandise sales.
The petroleum sales increase resulted from an 18.9% increase in retail selling prices per gallon and a 2.7 million gallon or .9% increase in sales volume. The merchandise sales increase is primarily due to increased prepared food, beverages and
increased selling prices.



Costs of Goods Sold



Retail costs of goods sold
increased during the nine months ended May 31, 2011 by $166.7 million or 18.5% for the comparable period in fiscal 2010 from $899.1 million to $1,065.8 million. The increase was primarily due to $160.0 million in petroleum purchase prices,
merchandise costs of $1.6 million, fuel taxes of $4.1 million and freight costs of $1.0 million. This increase in petroleum purchase prices resulted in lower petroleum retail margins, which is typical in a rising market when retail pricing does not
keep pace with the rising market.



Selling,
General and Administrative Expenses



Retail SG&A expenses increased during the nine months ended May 31, 2011 by $2.5 million or 2.6% for the comparable period in fiscal 2010 from $94.6 million to $97.1 million. The increase was due
to payroll costs of $1.1 million, credit/customer service costs of $1.9 million, insurance/utilities/taxes of $.4 million and maintenance costs of $.3 million offset by a reduction in pension/post retirement costs of $1.2 million. The decrease was
primarily due to changes made in pension/post retirement benefits, as discussed above.



21



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##### Table of Contents

Wholesale Operations:



|                                                                 |  |                           |         |  |                          |   |         |      |  |   |         |  |  |   |         |  
|---------------------------------------------------------------- |  | ------------------------- | ------- |  | ------------------------ | - | ------- | ---- |  | - | ------- |  |  | - | ------- | -
|                                                                 |  | Three Months EndedMay 31, |         |  | Nine Months EndedMay 31, |  
|                                                                 |  | 2011                      |         |  | 2010                     |   |         | 2011 |  |   | 2010    | 
|                                                                 |  | (dollars in thousands)    |        
|Net Sales (a)                                                    |  | $                         | 363,315 |  |                          | $ | 351,258 |      |  | $ | 958,741 |  |  | $ | 924,614 |  
|Costs of goods sold (exclusive of depreciation and amortization) |  |                           | 330,901 |  |                          |   | 355,129 |      |  |   | 891,852 |  |  |   | 963,472 |  
|Selling, general and administrative expenses                     |  |                           | 4,237   |  |                          |   | 4,941   |      |  |   | 13,044  |  |  |   | 17,026  |  
|Depreciation and amortization expenses                           |  |                           | 3,876   |  |                          |   | 4,153   |      |  |   | 12,036  |  |  |   | 12,459  |  
|                                                                 |  |                           |         |  |                          |   |         |      |  |   |         |  |  |   |         |  
|Segment Operating (Loss) Income                                  |  | $                         | 24,301  |  |                          | $ | (12,965 | )    |  | $ | 41,809  |  |  | $ | (68,343 | )
|                                                                 |  |                           |         |  |                          |   |         |      |  |   |         |  |  |   |         |  



Key Wholesale Operating
Statistics:



|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|-------------------------------------------------------------------------------- |  | ------------------------- | ------- | - | ------------------------ | - | ------- | ---- |  | - | ------- | - |  | - | ------- | -
|                                                                                 |  | Three Months EndedMay 31, |         |   | Nine Months EndedMay 31, |  
|                                                                                 |  | 2011                      |         |   | 2010                     |   |         | 2011 |  |   | 2010    |  
|Refinery Product Yield (thousands of barrels)                                    |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Gasoline and gasoline blendstock                                                 |  |                           | 1,774   |   |                          |   | 2,400   |      |  |   | 5,724   |   |  |   | 6,909   |  
|Distillates                                                                      |  |                           | 975     |   |                          |   | 1,341   |      |  |   | 3,322   |   |  |   | 3,585   |  
|Asphalt                                                                          |  |                           | 1,323   |   |                          |   | 1,628   |      |  |   | 3,443   |   |  |   | 4,709   |  
|Butane, propane, residual products, internally produced fuel and other (Other) |  |                           | 411     |   |                          |   | 597     |      |  |   | 1,718   |   |  |   | 1,678   |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Total Product Yield                                                              |  |                           | 4,483   |   |                          |   | 5,966   |      |  |   | 14,207  |   |  |   | 16,881  |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|% Heavy Crude Oil of Total Refinery Throughout (b)                               |  |                           | 60      | % |                          |   | 58      | %    |  |   | 49      | % |  |   | 60      | %
|Crude throughput (thousand barrels per day)                                      |  |                           | 46.6    |   |                          |   | 60.5    |      |  |   | 47.7    |   |  |   | 57.8    |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Product Sales (thousand of barrels) (a)                                          |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Gasoline and gasoline blendstock                                                 |  |                           | 1,277   |   |                          |   | 1,482   |      |  |   | 3,711   |   |  |   | 4,014   |  
|Distillates                                                                      |  |                           | 727     |   |                          |   | 1,115   |      |  |   | 2,619   |   |  |   | 2,807   |  
|Asphalt                                                                          |  |                           | 1,215   |   |                          |   | 1,416   |      |  |   | 3,284   |   |  |   | 4,647   |  
|Other                                                                            |  |                           | 123     |   |                          |   | 253     |      |  |   | 441     |   |  |   | 799     |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Total Product Sales Volume                                                       |  |                           | 3,342   |   |                          |   | 4,266   |      |  |   | 10,055  |   |  |   | 12,267  |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Product Sales (dollars in thousands) (a)                                         |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Gasoline and gasoline blendstock                                                 |  | $                         | 164,048 |   |                          | $ | 132,501 |      |  | $ | 402,431 |   |  | $ | 342,812 |  
|Distillates                                                                      |  |                           | 99,469  |   |                          |   | 103,939 |      |  |   | 302,020 |   |  |   | 247,570 |  
|Asphalt                                                                          |  |                           | 91,412  |   |                          |   | 102,224 |      |  |   | 228,847 |   |  |   | 294,099 |  
|Other                                                                            |  |                           | 8,386   |   |                          |   | 12,594  |      |  |   | 25,443  |   |  |   | 40,133  |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  
|Total Product Sales                                                              |  | $                         | 363,315 |   |                          | $ | 351,258 |      |  | $ | 958,741 |   |  | $ | 924,614 |  
|                                                                                 |  |                           |         |   |                          |   |         |      |  |   |         |   |  |   |         |  



|(a) | Sources of total product sales include products manufactured at the refinery located in Warren, Pennsylvania and products purchased from third
parties.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | The Company defines heavy crude oil as crude oil with an American Petroleum Institute specific gravity of 26 or less.
|--- | -----------------------------------------------------------------------------------------------------------------------



Comparison of Fiscal
Quarters Ended May 31, 2011 and 2010



During the three months ended May 31, 2011 the refinery incurred a 21 day scheduled maintenance turnaround. Refinery crude throughput decreased by 13.9 thousand barrels per day (bpd) or 23.2%
for the comparable period in fiscal 2010 from 60.0 bpd to 46.6 bpd. Refinery product yields decreased 1.5 thousand barrels or 24.9% from 6.0 to 4.5 thousand barrels during the same comparable period.



22



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##### Table of Contents

Net Sales



Wholesale sales increased during the three
months ended May 31, 2011 by $12.1 million or 3.4% for the comparable period in fiscal 2010 from $351.2 million to $363.3 million. The increase was due to a 32.08% increase in wholesale prices offset by a 21.7% decrease in wholesale volume.



Costs of Goods Sold (exclusive of depreciation
and amortization)



Wholesale
costs of goods sold decreased during the three months ended May 31, 2011 by $24.2 million or 6.8% for the comparable period in fiscal 2010 from $355.1 million to $330.9 million. The decrease in wholesale costs of goods sold during this period
was primarily due to a decrease in cost of raw materials.



Selling, General and Administrative Expenses



Wholesale SG&A expenses decreased during the three months ended May 31, 2011 by $.7 million or 14.2% for the
comparable period in fiscal 2010 from $4.9 million or 1.4% of net wholesale sales to $4.2 million or 1.2% of net wholesale sales. The decrease was primarily due to changes made in pension/post retirement benefits, as discussed above.



Comparison of Nine Months Ended May 31, 2011 and 2010



During the first and
second fiscal quarters of 2011, wholesale sales were negatively affected by the Enbridge Pipeline disruption and the 30-day scheduled refinery maintenance turnaround in October 2010. These two events resulted in the Company running an average crude
throughput of 40,500 bbl per day for the first fiscal quarter 2011 versus 56,500 bbl per day for the comparable period in fiscal 2010. The average crude throughput for the second quarter of fiscal year 2011 was 55,900 bbl per day as
compared to 56,500 bbl per day for the second quarter of fiscal year 2010. The Enbridge Pipeline disruption also resulted in the Company running 22% of heavy crude oil for the first fiscal quarter of 2011 versus 61% for the comparable period in
fiscal 2010. Heavy crude oil usage for the second quarter of fiscal year 2011 was 60%, the same percentage as the comparable period in fiscal year 2010. The Company experienced no material effects in the third quarter of fiscal year 2011 as a result
of the Enbridge Pipeline disruption.



Net Sales



Wholesale sales increased during the nine months ended May 31, 2011 by $34.1 million or 3.7% for the comparable
period in fiscal 2010 from $924.6 million to $958.7 million. The increase was due to a 26.5% increase in wholesale prices offset by a 18.0% decrease in wholesale volume.



Costs of Goods Sold (exclusive of depreciation and
amortization)



Wholesale
costs of goods sold decreased during the nine months ended May 31, 2011 by $71.6 million or 7.4% for the comparable period in fiscal 2010 from $963.5 million to $891.9 million. The decrease in wholesale costs of goods sold was primarily due to
a decrease in the costs of product purchased and refinery expenses.



Selling, General and Administrative Expenses



Wholesale SG&A expenses decreased during the nine months ended May 31, 2011 by $4.0 million or 23.4% for the
comparable period in fiscal 2010 from $17.0 million or 1.8% of net wholesale sales to $13.0 million or 1.4% of net wholesale sales. The decrease was primarily due to changes made in pension/post retirement benefits, as discussed above.



23



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##### Table of Contents

Consolidated Expenses:



Interest Expense, net



Net interest expense (interest expense less
interest income) for the three months ended May 31, 2011 increased $2.8 million or 30.9% for the comparable period in fiscal 2010 from $9.0 million to $11.8 million. The increase was primarily due to the Company concurrently accruing interest
expense on the new issue of First Priority Senior Secured Notes due 2018 from the issue date of March 5, 2011 until the final redemption of the Senior Notes due 2012 on April 7, 2011.



Net interest expense (interest expense less
interest income) for the nine months ended May 31, 2011 increased $3.4 million or 13.0% for the comparable period in fiscal 2010 from $26.2 million to $29.6 million. The increase was primarily due to the Company concurrently accruing interest
expense on the new issue of First Priority Senior Secured Notes due 2018 from the issue date of March 5, 2011 until the final redemption of the Senior Notes due 2012 on April 7, 2011.



Income Tax Expense / (Benefit)



The Companys effective tax rate for
the three months ended May 31, 2011 and 2010 was approximately 36% and 22% respectively and for the nine month periods was approximately 38% and 37% respectively.



Liquidity and Capital Resources



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



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



|                          |  |              |         | 
|------------------------- |  | ------------ | ------- | 
|                          |  | May 31, 2011 |        
|Cash and cash equivalents |  | $            | 27,710  | 
|Working capital           |  | $            | 277,989 | 
|Current ratio             |  |              | 3.4     | 
|Debt                      |  | $            | 469,240 | 



Primary
sources of liquidity have been cash and cash equivalents, and borrowing availability under a revolving line of credit. We believe available capital resources will be adequate to meet our working capital, debt service, and capital expenditure
requirements for existing operations.



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



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|                                                                   |  |                               |        |  
|------------------------------------------------------------------ |  | ----------------------------- | ------ | -
|                                                                   |  | Nine Months EndedMay 31, 2011 |       
|                                                                   |  | (in millions)                 |       
|Significant uses of cash                                           |  |                               |        |  
|Investing activities:                                              |  |                               |        |  
|Additions to deferred turnaround costs                             |  | $                             | (14.7  | )
|Property, plant and equipment                                      |  |                               |        |  
|Other general capital items (tank repairs, refinery piping, etc)   |  |                               | (10.1  | )
|Retail maintenance (blacktop, roof, HVAC, rehab)                   |  |                               | (2.0   | )
|Environmental                                                      |  |                               | (1.9   | )
|Computers and equipment upgrade                                    |  |                               | (1.4   | )
|Retail petroleum upgrade                                           |  |                               | (.6    | )
|State and federal mandates:                                        |  |                               |        |  
|Renewable fuels                                                    |  |                               | (4.0   | )
|Reduction of benzene and gasoline                                  |  |                               | (3.1   | )
|                                                                   |  |                               |        |  
|Total property, plant and equipment                                |  | $                             | (23.1  | )
|                                                                   |  |                               |        |  
|Net cash used in investing activities                              |  | $                             | (37.8  | )
|                                                                   |  |                               |        |  
|Financing activities:                                              |  |                               |        |  
|Net proceeds from issuance of long term debt                       |  | $                             | 352.0  |  
|Net borrowings on revolving credit facility                        |  |                               | 29.9   |  
|Proceeds from issuance of common stock of non-controlling interest |  |                               | 15.0   |  
|Principal reductions of long term debt                             |  |                               | (324.8 | )
|Deferred financing costs                                           |  |                               | (10.5  | )
|                                                                   |  |                               |        |  
|Net cash provided by financing activities                          |  | $                             | 61.6   |  
|                                                                   |  |                               |        |  
|Working capital items:                                             |  |                               |        |  
|Refundable income taxes                                            |  | $                             | 36.4   |  
|Accrued liabilities decrease                                       |  |                               | 7.2    |  
|Decrease in inventory                                              |  |                               | 6.7    |  
|Income taxes payable decrease                                      |  |                               | 2.6    |  
|Amounts due from affiliated companies, net                         |  |                               | 1.0    |  
|Sales, use and fuel taxes payable increase                         |  |                               | .5     |  
|Accounts receivable increase                                       |  |                               | (59.0  | )
|Prepaid expense increase                                           |  |                               | (14.8  | )
|Accounts payable decrease                                          |  |                               | (10.6  | )
|                                                                   |  |                               |        |  
|Cash provided by working capital items                             |  | $                             | (30.0  | )
|                                                                   |  |                               |        |  



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



Maintenance and non-discretionary capital expenditures have averaged approximately $6.0 million annually over the last
three years for the refining and marketing operations. Management does not foresee any increase in these maintenance and non-discretionary capital expenditures during fiscal year 2011.



Future liquidity, both short and long-term, will continue to be primarily dependent on
realizing a refinery margin sufficient to cover fixed and variable expenses, including planned capital expenditures. We expect to be able to meet our working capital, capital expenditure, contractual obligations, letter of credit and debt service
requirements out of cash flow from operations, cash on hand and borrowings under our Amended and Restated Revolving Credit Facility is $175,000,000. This provides the Company with flexibility relative to its cash flow requirements in light of market
fluctuations, particularly involving crude oil prices and seasonal business cycles



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and will assist the Company in meeting its working capital, ongoing capital expenditure needs and for general corporate purposes. The agreement expires on May 18, 2016. Under the Amended and
Restated Revolving Credit Facility, the applicable margin is calculated on the average unused availability as follows: (a) for base rate borrowing, at the greater of the Agent Banks prime rate the Federal Funds Open Rate plus 1.5%; or the
Daily LIBOR rate plus 3%; plus an applicable margin of 0% to .5%; (b) for euro-rate based borrowings, at the LIBOR Rate plus an applicable margin of 2.75% to 3.25%. The Agent Banks prime rate at May 31, 2011 was 3.25%.



The Amended and Restated Revolving Credit
Facility is secured primarily by certain cash accounts, accounts receivable and inventory. Until maturity, we may borrow on a borrowing base formula as set forth in the facility. We had standby letters of credit of $4.4 million as of May 31,
2011 and there were outstanding borrowings under the Amended and Restated Revolving Credit Facility in the amount of $102.0 million resulting in net availability of $68.6 million. As of July 7, 2011 there was $96.0 million outstanding on the
$175 million Amended and Restated Revolving Credit Facility and standby letters of credit in the amount of $4.4 million, resulting in a net availability of $74.6 million and the Company had full access to it. The Companys working capital ratio
was 3.4 as of May 31, 2011.



On January 14, 2011, we entered into an Asphalt Purchase and Sale Agreement and Asphalt Product Throughput and
Terminal Services Agreement (together, the Asphalt Agreements) with United Refining Asphalt, Inc. (URA), a special purpose entity formed by United Refining, Inc. (our Parent) in connection with the Asphalt
Agreements, under the terms of which, we may sell asphalt to URA during the winter months at such times and in such amounts as may be mutually agreed by the parties, and are required to provide storage and related services until such asphalt is
resold and delivered to third parties during the summer months. URA received financing for up to $30 million in purchases under the agreements, and was capitalized with $15 million in cash by our Parent.



We have determined that URA meets the
definition of a variable interest entity and, in connection with the Asphalt Agreements, the Company is the primary beneficiary. Therefore we are required to treat URA similar to a consolidated subsidiary for financial reporting purposes. As a
result, we have consolidated the financial results of URA, including its entire balance sheet with the shareholders equity of URA displayed as a component of equity (noncontrolling interest) and its entire income statement (after intercompany
eliminations). The net income (loss) of URA will not increase (or decrease) our net income, but rather will be included in our equity section as an increase (or decrease) to noncontrolling interest.



The URA credit facility with Bank of America,
N.A., acting as the Agent bank (Agent Bank) is secured by URAs cash accounts, accounts receivable and inventory. The applicable margin under this facility is; (a) for base rate borrowings the Agent Banks prime rate plus
an applicable margin of 2.75%; (b) for euro-rate based borrowings, at the LIBOR Rate plus an applicable margin of 3.75%. The Agent Banks prime rate at May 31, 2011 was 3.25%. The $30 million facility is due to expire
September 30, 2011.



As of
June 14, 2011 the URA credit facility was paid in full. As of June 21, 2011 the $15.0 million advance from URAs parent URI was paid in full, all URA inventory was liquidated and all URA sales were complete. URA has terminated its
credit facility, as of the close of business on June 28, 2011.



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



Federal, state and local laws and regulations relating to the environment affect nearly all of our operations. As is the case with all the companies engaged in similar industries, we face significant
exposure from actual or potential claims and lawsuits involving environmental matters. Future expenditures related to environmental



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##### Table of Contents

matters cannot be reasonably quantified in many circumstances due to the uncertainties as to required remediation methods and related clean-up cost estimates. We cannot predict what additional
environmental legislation or regulations will be enacted or become effective in the future or how existing or future laws or regulations will be administered or interpreted with respect to products or activities to which they have not been
previously applied.



Seasonal Factors



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



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



Inflation



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



|Item 3. | Quantitative and Qualitative Disclosures about Market Risk.
|------- | -----------------------------------------------------------



The Company uses its Amended and Restated Revolving Credit Facility to finance a portion of its
operations. As of July 7, 2011, there was $96.0 million outstanding under the Amended and Restated Revolving Credit Facility. These on-balance sheet financial instruments, to the extent they provide for variable rates, expose the Company to
interest rate risk resulting from changes in the PNC Prime rate, the Federal Funds or LIBOR rate.



From time to time, the Company uses derivatives to reduce its exposure to fluctuations in crude oil purchase costs and
refining margins. Derivative products, specifically crude oil option contracts and crack spread option contracts are used to hedge the volatility of these items. The Company accounts for changes in the fair value of its contracts by marking them to
market and recognizing any resulting gains or losses in its Statement of Operations.



During the quarter ended May 31, 2011, the Company had 5,250,000 barrels of heating oil and gasoline crackspread
swaps outstanding as part of its risk management strategy. The crackspread swaps expire sequentially beginning June 2011 through December 2012. These derivative instruments are being used by the Company to lock in margins on future sales of diesel
fuel and gasoline. See Footnote 2, in the Companys Consolidated Financial Statements.



|Item 4. | Controls and Procedures.
|------- | ------------------------



Our management, with the participation of our chief executive officer and chief financial officer, evaluated the
effectiveness of our disclosure controls and procedures as of May 31, 2011. The term disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a
company that are designed to ensure that information required to be disclosed by a company in the reported, within the time periods specified in the SECs rules and forms. Disclosure controls and procedures include, without limitation, controls
and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the companys management, including its principal
executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable
assurance of achieving their objectives



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and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures
as of May 31, 2011, our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.



There have not been any changes in the
Companys internal controls over financial reporting that occurred during the Companys fiscal quarter ended May 31, 2011 that has materially affected, or is reasonably likely to materially affect, the Companys internal controls
over financial reporting.



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|Part II | OTHER INFORMATION
|------- | -----------------



|Item 1. | Legal Proceedings.
|------- | ------------------



None.



|Item 1A. | Risk Factors.
|-------- | -------------



There have been no material changes in our Risk Factors disclosed in the Form 10-K for the year ended August 31, 2010
and in the Form 10-Q for the quarter ended February 28, 2011.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds.
|------- | ------------------------------------------------------------



None.



|Item 3. | Defaults Upon Senior Securities.
|------- | --------------------------------



None.



|Item 4. | (Removed and Reserved).
|------- | -----------------------



|Item 5. | Other Information.
|------- | ------------------



None.



|Item 6. | Exhibits.
|------- | ---------



|                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|--------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                | 
|Exhibit 4.1*    |  | Supplemental Indenture, dated as of March 8, 2011, between the Company, the Subsidiary Guarantors and The Bank of New York Mellon (f/k/a The Bank of New
York), as trustee.                                                                                                                                                                                                                                                                           
|                | 
|Exhibit 4.2**   |  | Indenture, dated as of March 8, 2011, between the Company, the Subsidiary Guarantors and The Bank of New York Mellon Trust Company, N.A., as
Trustee.                                                                                                                                                                                                                                                                                                 
|                | 
|Exhibit 10.1*   |  | Security Agreement, dated as of March 8, 2011, between the Company and The Bank of New York Mellon Trust Company, N.A., as Collateral Agent.                                                                                                                                                                                                                                                                                                          
|                | 
|Exhibit 10.2*   |  | Intercreditor Agreement dated as of March 8, 2011, The Bank of New York Mellon Trust Company, N.A., as Collateral Agent, PNC, Bank National Association, as
Agent, the Company, United Refining Company of Pennsylvania, Kiantone Pipeline Corporation, Country Fair, Inc., and Kwik-Fill Corporation.                                                                                                                                                
|                | 
|Exhibit 10.3*   |  | Open-End Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Filing, dated as of March 8, 2011, between the Company and The Bank of New
York Mellon Trust Company, N.A., as Collateral Agent.                                                                                                                                                                                                                                    
|                | 
|Exhibit 10.4*** |  | Amended and Restated Credit Agreement, dated May 18, 2011, by and among United Refining Company, United Refining Company of Pennsylvania, Kiantone Pipeline
Corporation, Country Fair, Inc., the lenders party thereto, PNC Capital Markets LLC and Merrill Lynch, Pierce, Fenner & Smith Inc., as Co-Lead Arrangers and Joint Bookrunners, PNC Bank, National Association, as Administrative Agent and Bank of
America, N.A., as Documentation Agent.



29



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|             |  |                                                                                                                                                                              
|------------ |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|             | 
|Exhibit 31.1 |  | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                           
|             | 
|Exhibit 31.2 |  | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                           
|             | 
|Exhibit 32.1 |  | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002



|* | Incorporated by reference to the Companys Current Report on Form 8-K (dated March 8, 2011), filed on March 11, 2011
|- | --------------------------------------------------------------------------------------------------------------------

|** | Incorporated by reference to the Companys Current Report on Form 8-K/A (dated March 8, 2011), filed on March 22, 2011
|-- | ----------------------------------------------------------------------------------------------------------------------

|*** | Incorporated by reference to the Companys Registration Statement of Form S-4, as amended on May 19, 2011
|--- | ---------------------------------------------------------------------------------------------------------



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SIGNATURES



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



Date: July 8, 2011



UNITED REFINING COMPANY
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




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SIGNATURES



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



Date: July 8, 2011



KIANTONE PIPELINE CORPORATION
(Registrant)/s/ Myron L. Turfitt
Myron L. Turfitt
President/s/ James E. MurphyJames E. Murphy Chief Financial Officer




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SIGNATURES



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



Date: July 8, 2011



UNITED REFINING COMPANY OF
PENNSYLVANIA
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




33



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SIGNATURES



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



Date: July 8, 2011



KIANTONE PIPELINE COMPANY
(Registrant)/s/ Myron L. Turfitt
Myron L. Turfitt
President/s/ James E. MurphyJames E. Murphy Chief Financial Officer




34



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SIGNATURES



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



Date: July 8, 2011



UNITED JET CENTER, INC.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




35



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



KWIK-FILL CORPORATION
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




36



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



INDEPENDENT GASOLINE AND OIL COMPANY OF ROCHESTER, INC.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




37



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



BELL OIL CORP.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




38



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



PPC, INC.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




39



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



SUPER TEST PETROLEUM, INC.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




40



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



KWIK-FIL, INC.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




41



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##### Table of Contents

SIGNATURES



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



Date: July 8, 2011



VULCAN ASPHALT REFINING CORPORATION
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President/s/ James E.
MurphyJames E. Murphy
Chief Financial Officer




42



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SIGNATURES



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



Date: July 8, 2011



COUNTRY FAIR, INC.
(Registrant)/s/ Myron L. TurfittMyron L. Turfitt
President and Chief Operating Officer/s/ James E.
MurphyJames E. Murphy
Vice President Finance




43