World Fuel Services 2008 Annual Report Download - page 90

WORLD FUEL SERVICES CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
We maintain a 401(k) defined contribution plan which covers all U.S. employees who meet minimum
requirements and elect to participate. Participants may contribute up to 15% of their compensation, subject to
certain limitations. During 2008, we made matching contributions of 50% for each 1% of the participants’
contributions up to 6% of the participants’ contributions. During 2007 and 2006, we made matching
contributions of 25% for each 1% of the participants’ contributions up to 4% of the participants’ contributions.
Annual contributions by us are made at our sole discretion, as approved by the Compensation Committee. We
recorded expenses for our contributions of approximately $.08 million, $0.2 million and $0.2 million for 2008,
2007 and 2006, respectively.
Certain of our foreign subsidiaries have defined contribution plans, which allow for voluntary contributions
by the employees. The foreign subsidiaries paid all general and administrative expenses of the plans and in some
cases made employer contributions on behalf of the employees. We recorded expenses for our contributions of
approximately $0.8 million, $0.8 million and $0.5 million for 2008, 2007 and 2006, respectively.
Environmental and Other Liabilities; Uninsured Risks
We utilize subcontractors to provide various services to customers, including into-plane fueling at airports,
fueling of vessels in-port and at-sea, and transportation and storage of fuel and fuel products. We are subject to
possible claims by customers, regulators and others who may be injured by a fuel spill or other accident. In
addition, we may be held liable for damages to the environment arising out of such events. Although we
generally require our subcontractors to carry liability insurance, not all subcontractors carry adequate insurance.
Our marine and land businesses do not have liability insurance to cover the acts or omissions of our
subcontractors. None of our liability insurance covers acts of war and terrorism. If we are held responsible for
any acts of war or terrorism, accident or other event, and the liability is not adequately covered by insurance and
is of sufficient magnitude, our financial position and results of operations will be adversely affected.
We have exited several businesses which handled hazardous and non-hazardous waste. We treated and/or
transported this waste to various disposal facilities. We may be held liable as a potentially responsible party for
the clean-up of such disposal facilities, or be required to clean up facilities previously operated by us, pursuant to
current U.S. federal and state laws and regulation. In addition, compliance with existing and future
environmental laws regulating underground storage tanks located at the retail gasoline stations that we operate
may require significant capital expenditures and increased operating and maintenance costs. The remediation
costs and other costs required to clean up or treat contaminated sites could be substantial. We pay tank
registration fees and other taxes to state trust funds established in our operating areas and maintain private
insurance coverage in support of future remediation obligations. These state trust funds or other responsible third
parties including insurers are expected to pay or reimburse us for remediation expenses less a deductible. To the
extent third parties do not pay for remediation as we anticipate, we will be obligated to make these payments.
These payments could materially adversely affect our financial condition and results of operations.
Reimbursements from state trust funds will be dependent on the maintenance and continued solvency of the
various funds.
Although we continuously review the adequacy of our insurance coverage, we may lack adequate coverage
for various risks, such as environmental claims. An uninsured or under-insured claim arising out of our activities,
if successful and of sufficient magnitude, will have a material adverse effect on our financial position and results
of operations.
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