GETTY REALTY CORP /MD/

Previous wording

The following discussion and analysis of financial condition and results of operations should be read in conjunction with the sections entitled “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024; and “Part I, Item 1. Financial Statements” in this Quarterly Report on Form 10-Q.

Current wording

The following discussion and analysis of financial condition and results of operations should be read in conjunction with the sections entitled “Part I, Item 1A. Risk Factors” and “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024; “Part I, “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Part II, Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the period ended March 31, 2025; and “Part I, Item 1. Financial Statements” in this Quarterly Report on Form 10-Q for the period ended June 30, 2025.

Previous wording

These forward-looking statements are based on our current beliefs and assumptions and information currently available to us, and are subject to known and unknown risks, uncertainties and other factors including, but not limited to, the risks described in “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K and this Quarterly Report on Form 10-Q as such risk factors may be updated from time to time in our public filings. Such risks and uncertainties were derived based on numerous important assumptions, which may not be realized, and may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Most of these factors are difficult to predict accurately and are generally beyond our control. New risk factors and uncertainties may also emerge from time to time, and there can be no assurance that we have identified all risks and uncertainties that may affect it.

Current wording

These forward-looking statements are based on our current beliefs and assumptions and information currently available to us, and are subject to known and unknown risks, uncertainties and other factors including, but not limited to, the risks described in “Part I, Item 1A. Risk Factors” and “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K, “Part I, “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Part II, Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the period ended March 31, 2025, and this Quarterly Report on Form 10-Q for the period ended June 30, 2025 as such risk factors may be updated from time to time in our public filings. Such risks and uncertainties were derived based on numerous important assumptions, which may not be realized, and may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Most of these factors are difficult to predict accurately and are generally beyond our control. New risk factors and uncertainties may also emerge from time to time, and there can be no assurance that we have identified all risks and uncertainties that may affect it.

Previous wording

As a result of these and other factors, we may experience material fluctuations in future operating results on a quarterly or annual basis, which could materially and adversely affect our business, financial condition, operating results, our growth or reinvestment strategies, our ability to pay dividends or stock price. An investment in our stock involves various risks, including those mentioned above and elsewhere in our Annual Report on Form 10-K, this Quarterly Report on Form 10-Q and those that are described from time to time in our other filings with the SEC.

Current wording

As a result of these and other factors, we may experience material fluctuations in future operating results on a quarterly or annual basis, which could materially and adversely affect our business, financial condition, operating results, our growth or reinvestment strategies, our ability to pay dividends or stock price. An investment in our stock involves various risks, including those mentioned above and elsewhere in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q and those that are described from time to time in our other filings with the SEC.

Previous wording

We are a net lease REIT specializing in the acquisition, financing and development of convenience, automotive and other single tenant retail real estate. Our portfolio is comprised of convenience stores, express tunnel car washes, automotive service centers (gasoline and repair, oil and maintenance, tire and battery, and collision), and certain other freestanding retail properties, including drive-thru quick service restaurants and automotive parts retailers. As of March 31, 2025, our portfolio included 1,119 properties, including 1,088 properties owned by us and 31 properties that we leased from third-party landlords. As a REIT, we are not subject to federal corporate income tax on the taxable income we distribute to our stockholders. In order to continue to qualify for taxation as a REIT, we are required, among other things, to distribute at least 90% of our ordinary taxable income to our stockholders each year.

Current wording

We are a net lease REIT specializing in the acquisition, financing and development of convenience, automotive and other single tenant retail real estate. Our portfolio is comprised of convenience stores, express tunnel car washes, automotive service centers (gasoline and repair, oil and maintenance, tire and battery, and collision), and certain other freestanding retail properties, including drive-thru quick service restaurants and automotive parts retailers. As of June 30, 2025, our portfolio included 1,137 properties, including 1,107 properties owned by us and 30 properties that we leased from third-party landlords. As a REIT, we are not subject to federal corporate income tax on the taxable income we distribute to our stockholders. In order to continue to qualify for taxation as a REIT, we are required, among other things, to distribute at least 90% of our ordinary taxable income to our stockholders each year.

Previous wording

Our 1,119 properties are located in 42 states and Washington D.C. and include a concentration in the Northeast and Mid-Atlantic regions that we believe is unique and not readily available for purchase or lease from other owners or landlords. Our typical property consists of approximately one acre of land in a larger metropolitan area and is used as a convenience store, express tunnel car wash, automotive service center, or certain other freestanding retail uses, including drive-thru quick service restaurants and automotive parts retailers. Many of our properties are located at highly trafficked urban intersections or conveniently close to highway entrances or exit ramps.

Current wording

Our 1,137 properties are located in 44 states and Washington D.C. and include a concentration in the Northeast and Mid-Atlantic regions that we believe is unique and not readily available for purchase or lease from other owners or landlords. Our typical property consists of approximately one acre of land in a larger metropolitan area and is used as a convenience store, express tunnel car wash, automotive service center, or certain other freestanding retail uses, including drive-thru quick service restaurants and automotive parts retailers. Many of our properties are located at highly trafficked urban intersections or conveniently close to highway entrances or exit ramps.

Previous wording

As of March 31, 2025, we leased 1,115 of our properties to tenants under triple-net leases, including 912 properties leased under 51 separate unitary or master triple-net leases, and 203 properties leased under single unit triple-net leases. These leases generally provide for an initial term of 15 or 20 years, with options for successive renewal terms of up to 20 years, and periodic rent escalations. As of March 31, 2025, our weighted average remaining lease term, excluding renewal options, was 10.0 years.

Current wording

As of June 30, 2025, we leased 1,132 of our properties to tenants under triple-net leases, including 926 properties leased under 54 separate unitary or master triple-net leases, and 206 properties leased under single unit triple-net leases. These leases generally provide for an initial term of 15 or 20 years, with options for successive renewal terms of up to 20 years, and periodic rent escalations. As of June 30, 2025, our weighted average remaining lease term, excluding renewal options, was 10.0 years.

Previous wording

As of March 31, 2025, we also had three properties vacant and one property under redevelopment.

Current wording

As of June 30, 2025, we also had three vacant properties and two properties under redevelopment.

Previous wording

During the three months ended March 31, 2024, we invested $40.6 million (net of amounts funded in prior periods) across 35 properties, including the acquisition 12 express tunnel car washes, seven auto service centers, two drive-thru quick service restaurants, and one convenience store.

Current wording

During the six months ended June 30, 2025, we invested $78.4 million (net of amounts funded in prior periods) across 33 properties, including the acquisition of 12 drive-thru quick service restaurants, seven auto service centers, five convenience stores and five express tunnel car washes.

Previous wording

During the three months ended March 31, 2025, we invested $11.1 million across six properties, including the acquisition of three drive-thru quick service restaurants, one express tunnel car wash and one auto service center.

Current wording

During the six months ended June 30, 2024, we invested $102.3 million (net of amounts funded in prior periods) across 53 properties, including the acquisition of 19 express tunnel car washes, 16 auto service centers, three drive-thru quick service restaurants, and two convenience stores.

Previous wording

We believe that certain of our properties, primarily those currently being used as gas and repair businesses, are well-suited to be redeveloped as modern convenience stores or other single tenant convenience and automotive retail uses, such as automotive parts retailers, quick service restaurants, auto service centers, and bank branches. We believe that the redeveloped properties can be leased or sold at higher values than their prior use. Since the inception of our redevelopment program in 2015, we have completed 32 redevelopment and revenue-enhancing capital expenditure projects.

Current wording

We believe that certain of our properties, primarily those currently being used as gas and repair businesses, are well-suited to be redeveloped as modern convenience stores or other single tenant convenience and automotive retail uses, such as automotive parts retailers, quick service restaurants, auto service centers, and bank branches. We believe that the redeveloped properties can be leased or sold at higher values than their prior use. Since the inception of our redevelopment program in 2015, we have completed 33 redevelopment and revenue-enhancing capital expenditure projects.

Previous wording

As of March 31, 2025, we had one property under active redevelopment and others in various stages of feasibility planning for potential recapture from our net lease portfolio.

Current wording

As of June 30, 2025, we had two properties under active redevelopment and others in various stages of feasibility planning for potential recapture from our net lease portfolio.

Previous wording

The decrease in property operating expenses was primarily due to a decrease in reimbursable real estate taxes as we transitioned certain tenants to paying real estate taxes directly to the applicable taxing authorities, as well as lower rent expense. The increase in leasing and redevelopment expenses was primarily due to an increase in professional fees related to leasing activities for potential redevelopment projects.

Current wording

The decrease in property operating expenses was primarily due to a decrease in reimbursable real estate taxes as we transitioned certain tenants to paying real estate taxes directly to the applicable taxing authorities, as well as lower rent expense. The decrease in leasing and redevelopment expenses was primarily due to a decrease in professional fees related to leasing activities for potential redevelopment projects.

Previous wording

Impairments are recorded when the carrying value of a property is reduced to fair value. Impairment charges for the three months ended March 31, 2025 and 2024 were attributable to the addition of asset retirement costs to certain properties due to changes in estimates associated with our environmental liabilities, which increased the carrying values of these properties in excess of their fair values. Impairment charges for the three months ended March 31, 2025 also included reductions in the carrying value of certain properties based on third-party indications of potential selling prices.

Current wording

Impairments are recorded when the carrying value of a property is reduced to fair value. Impairment charges for the three months ended June 30, 2025 and 2024 were attributable to the addition of asset retirement costs to certain properties due to changes in estimates associated with our environmental liabilities, which increased the carrying values of these properties in excess of their fair values. Impairment charges for the six months ended June 30, 2025 also included reductions in the carrying value of certain properties based on third-party indications of potential selling prices.

Previous wording

The change in environmental expenses was primarily due to higher legal fees and changes in environmental estimates. Environmental expenses vary from period to period and, accordingly, undue reliance should not be placed on the magnitude or the direction of change in reported environmental expenses for one period, as compared to prior periods.

Current wording

The change in environmental expenses was primarily due to an increase in environmental litigation accruals. Environmental expenses vary from period to period and, accordingly, undue reliance should not be placed on the magnitude or the direction of change in reported environmental expenses for one period, as compared to prior periods.

Previous wording

The gains on dispositions of real estate were primarily due to the disposition of two properties during the three months ended March 31, 2025 and one property during the three months ended March 31, 2024.

Current wording

The gains on dispositions of real estate were primarily due to the disposition of three properties during the three months ended June 30, 2025 and the partial condemnation of one property during the three months ended June 30, 2024.

Previous wording

The increase in general and administrative expenses was primarily due to increases in employee-related expenses, professional fees, and certain deal pursuit costs, partially offset by decreases in non-recurring retirement and severance costs and information technology expenses.

Current wording

The increase in general and administrative expenses was primarily due to increases in employee-related expenses, professional fees, and certain deal pursuit costs, partially offset by a decrease in non-recurring retirement and severance costs.

Previous wording

As of March 31, 2025, we had $292.5 million of availability under our Credit Facility, 5.0 million shares of common stock subject to forward sales agreements which are anticipated to generate approximately $153.4 million of gross proceeds upon settlement, and available cash and cash equivalents of $6.3 million.

Current wording

As of June 30, 2025, we had $275.0 million of availability under our Credit Facility, 3.9 million shares of common stock subject to forward sales agreements which are anticipated to generate approximately $118.8 million of gross proceeds upon settlement, and available cash and cash equivalents of $7.5 million.

Previous wording

Our cash flow activities for the three months ended March 31, 2025 and 2024, are summarized as follows (in thousands):

Current wording

Our cash flow activities for the six months ended June 30, 2025 and 2024, are summarized as follows (in thousands):

Previous wording

The change in net cash flow provided by operating activities for the three months ended March 31, 2025 and 2024 was primarily the result of changes in revenues and expenses as discussed in “Results of Operations” above and the other changes in assets and liabilities on our consolidated statements of cash flows.

Current wording

The change in net cash flow provided by operating activities for the six months ended June 30, 2025 and 2024 was primarily the result of changes in revenues and expenses as discussed in “Results of Operations” above and the other changes in assets and liabilities on our consolidated statements of cash flows.

Previous wording

The decrease in net cash flow used in investing activities was primarily due to a $75.3 million decrease in property acquisitions and an $11.6 million decrease in issuance of notes and mortgages receivable, partially offset by a $57.3 million decrease in collections of notes and mortgages receivable.

Current wording

The decrease in net cash flow used in investing activities was primarily due to a $63.7 million decrease in property acquisitions, a $12.7 million decrease in issuance of notes and mortgages receivable and a $2.5 million decrease in deposits for property acquisitions, partially offset by a $52.4 million decrease in collections of notes and mortgages receivable.

Previous wording

The increase in net cash flow used in financing activities was primarily due to the repayments of our $150.0 million Term Loan and $50.0 million Series C Notes, partially offset by the issuance of $125.0 million of new Senior Unsecured Notes, an increase of $35.0 million in net borrowings under the Credit Facility, and an increase in net proceeds from the issuance of common stock under the ATM Program of $11.1 million.

Current wording

The decrease in net cash flow provided by financing activities was primarily due to the net repayment under the Term Loan of $75.0 million, the repayment of $50.0 million Series C Notes, and an increase in cash dividends paid of $3.6 million, partially offset by an increase in net proceeds from the issuance of common stock under the equity offering and ATM Program of $32.8 million and $3.7 million, respectively, and the issuance of $125.0 million of new Senior Unsecured Notes and an increase of $85.0 million in net borrowings under the Credit Facility.

Previous wording

Unamortized debt issuance costs related to the Credit Facility were $4.4 million and $0.6 million as of March 31, 2025 and December 31, 2024, respectively, and are included in prepaid expenses and other assets on our consolidated balance sheets.

Current wording

Unamortized debt issuance costs related to the Credit Facility were $4.1 million and $0.6 million as of June 30, 2025 and December 31, 2024, respectively, and are included in prepaid expenses and other assets on our consolidated balance sheets.

Previous wording

In July 2024, we completed a follow-on public offering of 4.0 million shares of common stock in connection with forward sales agreements. We expect to settle the forward sales agreements, typically within 12 months, via physical delivery of the outstanding shares of common stock in exchange for gross cash proceeds of approximately $121.2 million.

Current wording

In July 2024, we completed a follow-on public offering of 4.0 million shares of common stock in connection with forward sales agreements. During the six months ended June 30, 2025, we settled approximately 1.2 million shares and realized net proceeds of $32.8 million after deducting fees and expenses and making certain other adjustments as provided in the equity distribution agreement. We expect to settle the remaining forward sales agreements via physical delivery of the outstanding shares of common stock in exchange for for gross cash proceeds of approximately $86.5 million.

Previous wording

During the three months ended March 31, 2025 and March 31, 2024, no shares of common stock were issued under the ATM Program. Future sales, if any, will depend on a variety of factors to be determined by us from time to time, including among others, market conditions, the trading price of our common stock, determinations by us of the appropriate sources of funding for us and potential uses of funding available to us.

Current wording

During the six months ended June 30, 2025 and June 30, 2024, no shares of common stock were issued under the ATM Program. Future sales, if any, will depend on a variety of factors to be determined by us from time to time, including among others, market conditions, the trading price of our common stock, determinations by us of the appropriate sources of funding for us and potential uses of funding available to us.

Previous wording

During the three months ended March 31, 2025 we settled 406,727 shares and realized net proceeds of $11.0 million after deducting fees and expenses and making certain other adjustments as provided in the equity distribution agreement. We expect to settle outstanding forward sales agreements, typically within 12 months of the respective agreement dates, via physical delivery of the outstanding shares of common stock in exchange for cash proceeds, although we may elect cash settlement or net share settlement for all or a portion of our obligations under the forward sales agreements, subject to certain conditions.

Current wording

During the six months ended June 30, 2025, we settled 406,727 shares and realized net proceeds of $10.9 million after deducting fees and expenses and making certain other adjustments as provided in the equity distribution agreement. We expect to settle outstanding forward sales agreements, typically within 12 months of the respective agreement dates, via physical delivery of the outstanding shares of common stock in exchange for cash proceeds, although we may elect cash settlement or net share settlement for all or a portion of our obligations under the forward sales agreements, subject to certain conditions.

Previous wording

The following table summarizes activity under our ATM Program in connection with forward sales agreements for the three months ended March 31, 2025 and 2024 ($ in thousands):

Current wording

The following table summarizes activity under our ATM Program in connection with forward sales agreements for the six months ended June 30, 2025 and 2024 ($ in thousands):

Previous wording

Regular quarterly dividends paid to our stockholders for the three months ended March 31, 2025 were $26.5 million, or $0.47 per share. There can be no assurance that we will continue to pay dividends at historical rates.

Current wording

Regular quarterly dividends paid to our stockholders for the six months ended June 30, 2025 were $53.4 million, or $0.94 per share. There can be no assurance that we will continue to pay dividends at historical rates.

Previous wording

We enter into leases and various other agreements which contractually allocate responsibility between the parties for known and unknown environmental liabilities at or relating to the subject properties. Under applicable law, we are contingently liable for these environmental obligations in the event that our tenant does not satisfy them, and we are required to accrue for environmental liabilities that we believe are allocable to others under our leases if we determine that it is probable that our tenant will not meet its environmental obligations. It is possible that our assumptions regarding the ultimate allocation method and share of responsibility that we used to allocate environmental liabilities may change, which may result in material adjustments to the amounts recorded for environmental litigation accruals and environmental remediation liabilities. We assess whether to accrue for environmental liabilities based upon relevant factors including our tenants’ histories of paying for such obligations, our assessment of their financial capability, and their intent to pay for such obligations. However, there can be no assurance that our assessments are correct or that our tenants who have paid their obligations in the past will continue to do so. We may ultimately be responsible to pay for environmental liabilities as the property owner if our tenant fails to pay them.

Current wording

We enter into leases and various other agreements which contractually allocate responsibility between the parties for known and unknown environmental liabilities at or relating to the subject properties. Under applicable law, we are contingently liable for these environmental obligations in the event that our tenant does not satisfy them, and we are required to accrue for environmental liabilities that we believe are allocable to others under our leases if we determine that it is probable that our tenant will not meet its environmental obligations. Our assumptions regarding the ultimate allocation method and share of responsibility that we use to allocate environmental liabilities may change, which has resulted, and may in the future result, in material adjustments to the amounts recorded for environmental litigation accruals and environmental remediation liabilities. We assess whether to accrue for environmental liabilities based upon relevant factors including our tenants’ histories of paying for such obligations, our assessment of their financial capability, and their intent to pay for such obligations. However, there can be no assurance that our assessments are correct or that our tenants who have paid their obligations in the past will continue to do so. We may ultimately be responsible to pay for environmental liabilities as the property owner if our tenant fails to pay them.

Previous wording

Based on the expiration of the Lookback Periods, together with other factors which have significantly mitigated our potential liability for preexisting environmental obligations, including the absence of any contractual obligations relating to properties which have been sold, quantifiable trends associated with types and ages of USTs at issue, expectations regarding future UST replacements, and historical trends and expectations regarding discovery of preexisting unknown environmental contamination and/or attempted pursuit of us therefor, we concluded that there is no material continued risk of having to satisfy contractual obligations relating to preexisting unknown environmental contamination at certain properties. Accordingly, as of March 31, 2025, we had removed $24.2 million of unknown reserve liabilities which had previously been accrued for these properties. There were no removals of unknown reserve liabilities for the three months ended March 31, 2025.

Current wording

Based on the expiration of the Lookback Periods, together with other factors which have significantly mitigated our potential liability for preexisting environmental obligations, including the absence of any contractual obligations relating to properties which have been sold, quantifiable trends associated with types and ages of USTs at issue, expectations regarding future UST replacements, and historical trends and expectations regarding discovery of preexisting unknown environmental contamination and/or attempted pursuit of us therefor, we concluded that there is no material continued risk of having to satisfy contractual obligations relating to preexisting unknown environmental contamination at certain properties. Accordingly, as of June 30, 2025, we had previously removed $24.2 million of unknown reserve liabilities which had previously been accrued for these properties.

Previous wording

Environmental liabilities are accreted for the change in present value due to the passage of time and, accordingly, $0.1 million of net accretion expense was recorded for each of the three months ended March 31, 2025 and 2024, respectively, which is included in environmental expenses. In addition, during the three months ended March 31, 2025 and 2024, we recorded credits to environmental expenses aggregating $0.2 million and $0.3 million, respectively, where decreases in estimated remediation costs exceeded the depreciated carrying value of previously capitalized asset retirement costs. Environmental expenses also include project management fees, legal fees and environmental litigation accruals.

Current wording

Environmental liabilities are accreted for the change in present value due to the passage of time and, accordingly, $0.2 million of net accretion expense was recorded for each of the six months ended June 30, 2025 and 2024 and included in environmental expenses. In addition, during the six months ended June 30, 2025 and 2024, we recorded credits to environmental expenses aggregating $0.2 million and $0.8 million, respectively, where decreases in estimated remediation costs exceeded the depreciated carrying value of previously capitalized asset retirement costs. Environmental expenses also include project management fees, legal fees and environmental litigation accruals.

Previous wording

During each of the three months ended March 31, 2025 and 2024, we increased the carrying values of certain of our properties by $0.6 million due to changes in estimated environmental remediation costs. The recognition and subsequent changes in estimates in environmental liabilities and the increase or decrease in carrying values of the properties are non-cash transactions which do not appear on our consolidated statements of cash flows.

Current wording

During the six months ended June 30, 2025 and 2024, we increased the carrying values of certain of our properties by $1.3 million and $1.1 million, respectively, due to changes in estimated environmental remediation costs. The recognition and subsequent changes in estimates in environmental liabilities and the increase or decrease in carrying values of the properties are non-cash transactions which do not appear on our consolidated statements of cash flows.

Previous wording

Capitalized asset retirement costs are being depreciated over the estimated remaining life of the UST, a 10-year period if the increase in carrying value is related to environmental remediation obligations or such shorter period if circumstances warrant, such as the remaining lease term for properties we lease from others. Depreciation and amortization expense related to capitalized asset retirement costs on our consolidated statements of operations was $0.5 million and $0.7 million for the three months ended March 31, 2025 and 2024, respectively. Capitalized asset retirement costs were $33.1 million (consisting of $25.0 million of known environmental obligations and $8.1 million of reserves for future environmental obligations related to preexisting unknown contamination) as of March 31, 2025, and $33.2 million (consisting of $25.0 million of known environmental obligations and $8.2 million of reserves for future environmental obligations related to preexisting unknown contamination) as of December 31, 2024. We recorded impairment charges aggregating $0.5 million and $0.4 million for the three months ended March 31, 2025 and 2024, respectively, for capitalized asset retirement costs.

Current wording

Capitalized asset retirement costs are being depreciated over the estimated remaining life of the UST, a 10-year period if the increase in carrying value is related to environmental remediation obligations or such shorter period if circumstances warrant, such as the remaining lease term for properties we lease from others. Depreciation and amortization expense related to capitalized asset retirement costs on our consolidated statements of operations was $0.9 million and $1.3 million for the six months ended June 30, 2025 and 2024, respectively. Capitalized asset retirement costs were $33.3 million (consisting of $25.1 million of known environmental obligations and $8.2 million of reserves for future environmental obligations related to preexisting unknown contamination) as of June 30, 2025, and $33.2 million (consisting of $25.0 million of known environmental obligations and $8.2 million of reserves for future environmental obligations related to preexisting unknown contamination) as of December 31, 2024. We recorded impairment charges aggregating $1.0 million and $0.9 million for the six months ended June 30, 2025 and 2024, respectively, for capitalized asset retirement costs.

Previous wording

We are subject to various legal proceedings and claims which arise in the ordinary course of our business. As of March 31, 2025 and December 31, 2024, we had $0.1 million accrued for these matters which we believe were appropriate based on information then currently available. It is possible that our assumptions regarding the ultimate allocation method and share of responsibility that we used to allocate environmental liabilities may change, which may result in our providing an accrual, or adjustments to the amounts recorded, for environmental litigation accruals. Matters related to our former Newark, New Jersey Terminal and the Lower Passaic River, and our MTBE litigations in the states of Pennsylvania and Maryland, in particular, could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. For additional information with respect to these and other pending environmental lawsuits and claims, see “Item 3. Legal Proceedings” in our Annual Report on Form 10-K for the year ended December 31, 2024, and “Part II, Item 1. Legal Proceedings” and Note 4 in “Part I, Item 1. Financial Statements” in this Quarterly Report on Form 10-Q.

Current wording

We are subject to various legal proceedings and claims which arise in the ordinary course of our business. As of June 30, 2025 and December 31, 2024, we had $5.0 million and $0.1 million accrued, respectively, for these matters which we believe were appropriate based on information then currently available. Our assumptions regarding the ultimate allocation method and share of responsibility that we use to allocate environmental liabilities may change, which has resulted, and may in the future result, in us providing an accrual or adjustments to the amounts previously recorded for environmental litigation accruals. Matters related to our former Newark, New Jersey Terminal and the Lower Passaic River, and our MTBE litigations in the states of Pennsylvania and Maryland, in particular, could cause a material adverse effect on our business, financial condition, results of operations, liquidity, ability to pay dividends or stock price. For additional information with respect to these and other pending environmental lawsuits and claims,see “Part I, Item 3. Legal Proceedings” in our Annual Report on Form 10-K for the year ended December 31, 2024; “Part II, Item 1. Legal Proceedings” and “Note 4 — Commitments and Contingencies” in “Part I, Item 1. Financial Statements” in our Quarterly Report on Form 10-Q for the period ended March 31, 2025; and “Part II, Item 1. Legal Proceedings” and “Note 4 — Commitments and Contingencies” in “Part I, Item 1. Financial Statements” in this Quarterly Report on Form 10-Q for the period ended June 30, 2025.