SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 10-K
ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
(X) Annual report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended June 30, 1995 or
( ) Transition report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934
Commission File Number 0-8536
_____________________
THE NEW PARAHO CORPORATION
(Exact name of registrant as specified in its charter)
Colorado 84-1034362
(State or other Jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
5387 Manhattan Circle, Suite 104, Boulder, CO 80303
(Address of principal executive offices)
Registrant's telephone number, including area code (303) 543-8900
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
Common Stock $.01 Par Value
(Title of Class)
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 if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K s.229.405 of this chapter is not
contained herein, and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. _X__
Aggregate market value of the voting stock held by nonaffiliates of
the registrant (9,988,662 shares) based upon the most recent
average bid and asked prices of such stock which are as of August
31, 1995.
$1,498,299
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes X No ___
Number of shares outstanding of each of the registrant's classes of
common stock, as of September 28, 1995.
50,772,982 shares of registrant's
common stock, $0.01 par value
Registrant's definitive proxy statement filed pursuant to
Regulation 14A, for the annual meeting to be held in December, 1995
is incorporated into Part III by reference.
<PAGE>
PART I
Item 1. BUSINESS
Introduction - The New Paraho Corporation and
its subsidiaries (the "Company" or "New Paraho") hold patents
and proprietary rights applicable to the retorting of oil from
shale by use of an aboveground, vertical shaft retort. The
Company also has rights to use certain intellectual properties
to test and to commercially develop the use of shale oil in the
production of asphalt. In addition, the Company owns interests
in oil shale lands and holds a note receivable from the sale of
certain property and mineral rights.
History - On July 23, 1986 Paraho Development
Corporation merged with New Paraho, which was a wholly-owned
subsidiary of Energy Resources Technology Land, Inc. ("ERTL"),
pursuant to a plan of reorganization under Chapter 11 of the
Bankruptcy Code. Following the merger, shareholders of Paraho
Development Corporation received 5% of the outstanding common
stock of New Paraho. Former creditors of Paraho Development
Corporation received 15% of the common stock of New Paraho and
income certificates (the "Income Certificates") representing
rights in oil shale mineral properties located in Rio Blanco
County, Colorado which were previously owned by ERTL (all of
ERTL's interest in such properties before it transferred 50% of
such interest to the Company is hereinafter defined as the "Rio
Blanco Properties"). After the merger, ERTL owned 80% of the
outstanding common stock of New Paraho.
New Paraho was incorporated in December 1985 as a wholly-
owned subsidiary of ERTL. ERTL capitalized New Paraho with
$1,000 and contributed 50% of its interest in the Rio Blanco
Properties. ERTL accounted for the acquisition of Paraho
Development Corporation as a purchase.
Based upon the current control by ERTL of New Paraho, the
Company is included for Federal income tax purposes as part of
the ERTL consolidated group of corporations and the results of
its operations are reported in the consolidated Federal income
tax returns filed by ERTL from the date of the confirmation of
reorganization, July 23, 1986, forward. Accordingly, and as
long as such controlling interest is maintained, losses and/or
tax credits, if any, for Federal income tax purposes generated
by New Paraho may be applied against the income and/or income
tax for Federal income tax purposes of members of the ERTL
group.
The group has established a tax allocation policy which
requires the Federal income tax liability to be computed on a
separate return basis. Any losses or other credits directly
attributable to the Company which result in a reduction of the
consolidated tax liability will be reimbursed by the parent.
Likewise, the Company will be charged for its share of the
consolidated tax liability.
Asphalt Feasibility Program - The activities of
the Company are devoted to developing, testing and test
marketing shale oil-derived asphalt paving materials. There is
no established market for these materials, and they are not
produced in commercial quantities, although the Company has sold
small quantities of these materials to customers on an isolated
basis. The Company's current activities and sales are not
sufficient to sustain the Company on an ongoing basis without
either substantial additional outside funding or the financing
and development of a commercial plant. The Company's recent
activities have been designed to establish the feasibility of
constructing and operating such a plant. Even if the
feasibility of such a plant can be established, a number of
events or circumstances could prevent the Company from
establishing commercial production of shale oil-derived asphalt
paving materials. These include changes in technology, changes
in government regulations, and the inability to obtain financing
for a commercial facility.
In June 1987, the Company began a commercial
feasibility program in order to evaluate the economic viability
of producing and marketing commercial quantities of shale oil-
derived asphalt paving materials. ERTL has acquired certain
rights in patents, patent applications and other intellectual
properties from Western Research Institute ("WRI") regarding the
use of shale oil-derived asphalt material (the "WRI
Technology"). ERTL has granted the Company the right to use the
WRI Technology for the Asphalt Feasibility Program. Researchers
at WRI discovered that certain species present in shale oil
significantly reduce moisture damage and potentially reduce
binder embrittlement when added to asphalt. This is
particularly true for shale oil produced by direct-heated
retorting process such as the oil shale retorting technology
owned by the Company (the "Paraho Process"). Accordingly, a
significant and cost effective extension to the durability and
life of asphalt paving materials could be realized if the WRI
Technology were combined with the use of shale oil produced by
the Paraho Process. On the basis of the initial WRI laboratory
tests and the Company's field tests performed to date, it
appears that shale oil-based asphalt paving material will last
significantly longer than conventional asphalt.
Paraho has revised its original economic estimates, and has
developed a staged development option in anticipation that
initial investors would elect to finance a smaller production
facility due to capital and/or market considerations. Under
this scenario, and based on initial estimates by Paraho, a plant
sized to retort 850 tons per day of oil shale and to then
further process the crude shale oil into asphalt modifiers using
the proprietary SOMAT (Shale Oil Modified Asphalt Technology)
process developed by the Company, represents the minimum
production capacity required to achieve a satisfactory return on
equity. The Company believes that the assumptions it employed
in making these estimates are reasonable. There can be no
assurance, however, that the assumptions will prove to be true
or that the Asphalt Feasibility Program will be successful.
To establish the commercial economics of producing shale
oil-derived asphalt, the Company initiated the Asphalt
Feasibility Program which includes the construction and
evaluation of field test strips and a more thorough evaluation
of the economic viability of producing and marketing commercial
quantities of shale oil-derived asphalt paving materials.
Working in cooperation with state, county and municipal
highway officials in Colorado, Utah, Wyoming, Texas, and
Michigan a total of twelve test strips were constructed during
the 1989 to 1991 time frame.
During fiscal year 1991, Marathon Oil Company ("Marathon")
began evaluating Paraho's plans for the construction and
operation of a facility to commercially produce SOMAT. Marathon
continues to fund the expanded field evaluation program designed
to assess the technical performance characteristics of SOMAT
over a broader range of climatic and road use conditions. This
expanded program has resulted in the construction of three of
the aforementioned test strips, two of which are located in
Texas, and one in Michigan.
Seven of the twelve test strips, including the three funded
by Marathon, were selected for a five year technical monitoring
program which is designed to provide detailed data on the
performance characteristics of the SOMAT and control asphalts
used in the construction of each of the test strips. The seven
test strips were selected primarily on the basis of
geographical, or climatic, diversity.
The results from the five annual evaluations of four of
these seven test strips, and the first three annual evaluations
of the additional three have been obtained. Results from the
fifth and third annual evaluations, respectively, continue to
show that with respect to stripping, aging and rejuvenation of
recycled asphalt, SOMAT demonstrated superior performance
compared to conventional and polymer modified asphalts. In
terms of rutting, thermal cracking, and fatigue cracking, SOMAT
appeared superior compared to conventional asphalts and
comparable to polymer modified asphalts. In addition, SOMAT
enjoys a distinct advantage over polymer modified asphalts and
is comparable to conventional asphalts with regard to materials
and construction handling characteristics.
In January, 1993, Paraho initiated the test market phase of
the Asphalt Feasibility Program. This phase was intended to
determine the actual marketability of the product in the paving
industry. The first sale of the material in the open
marketplace occurred in June 1993, with four more projects
completed during the remainder of 1993. In addition, paving
projects utilizing SOMAT in the states of Colorado, Wyoming and,
California were completed in the late summer of 1994. These
projects utilized a total of approximately 1,400 barrels of
shale oil modifier, which comprises approximately half of the
shale oil modifier produced during fiscal year 1994. The
Company plans to market the remaining modifier for paving
projects in the summer of 1996, and terminate the test market
phase, with no further plans to produce additional material.
The Company expended approximately $324,000 in 1992,
$1,068,000 in 1993, $880,000 in 1994, and $743,000 in 1995 on
direct research and development of this shale oil-derived
asphalt product. The Company does not have funding for any
additional research and development or commercial production
efforts. Although the Company is seeking additional financing
to fund these efforts, it currently appears unlikely that the
Company will succeed in doing so.
Based on the results of the test strip evaluations, the
Asphalt Feasibility Program has determined that this product is
technically feasible. Since 1989, the Company has been
attempting to finance, design, and construct a retorting and
SOMAT production facility suitable for asphalt operations. This
has included efforts to seek funding to construct and operate a
commercial-scale production facility with an initial capacity of
275 BPSD of shale oil (Phase I) and subsequent expansion by an
additional 275 BPSD (Phase II). A preliminary estimate for the
construction of Phase I of the project, modernization and
expansion of the mine, pilot and start-up operating losses,
working capital and financing costs is $42.5 million. The
estimated cost for Phase II is $15.8 million, with expected
positive cash flow from operations reducing costs by $4.1
million in the fourth year of the project. Total estimated net
costs for Phase I and II are $54.2 million. Although the
Company has been aggressively seeking financial commitments for
the construction of a commercial retorting facility since 1989,
to date the Company has not received any commitments or serious
indications of interest from any potential financial partner.
Although the Company is continuing to seek financial
commitments, it appears unlikely it will succeed in doing so.
Asphalt Feasibility Program Financing - On June
1, 1995, the Tell Ertl Family Trust (the "Trust") approved an
extension of the due date of the Company's line of credit to
July 1, 1996 in order to continue to finance the test market
program. Under the terms of the note securing this line of
credit, the Trust, through its trustees, reserves the right to
approve the Company's activities and budgets during the term of
the note. Although the Company believes the existing sources of
financing will be sufficient to continue the Asphalt Feasibility
Program through June 30, 1996, there is no assurance that the
Company will have the funding to continue the program beyond
that date.
When the note becomes due on such date, the Company will
have to either extend the term of the note or find other
financing to pay off the note and continue operations. There
can be no assurance that an extension will be granted or that
other financing could be found. If the Trust does not extend
the maturity of its note due July 1, 1996 and the Company cannot
obtain other financing, the Company will be required to sell
assets to repay the note, and may be required to terminate all
activities and liquidate.
The Company also has funds available resulting from the
exercise by Tosco Corporation's wholly-owned subsidiary, The Oil
Shale Corporation, of its option to purchase the Rio Blanco
Properties (the "Purchase Option"). The total purchase price
was $12,711,700, of which the Company received half. On
closing, the Company received $575,000 and a 50% interest in a
note receivable in the amount of $11,561,700, payable in fifteen
equal annual installments of $770,780 commencing December 17,
1990 with interest at 5% payable quarterly.
Paraho Technology - The Company, directly and
through its subsidiaries, owns the Paraho Process which consists
of patents and proprietary rights applicable to the retorting of
oil from shale by use of an above ground, vertical shaft retort.
In connection with the Asphalt Feasibility Program, the Company
has continued its research and development activities on the
Paraho Process. The Company has already successfully
demonstrated the Paraho Process on a semi-works scale. Paraho
Development Corporation, predecessor to the Company, produced
approximately 110,000 barrels of shale oil. Of these,
approximately 98,000 barrels were refined into gasoline, jet
fuel, heavy fuel oil and other products. These products were
tested by several government agencies and private companies
under the direction of the U.S. Navy, and met specifications set
by the U.S. Navy. There can be no assurance, however, that any
commercial oil shale facility will be constructed or that, if
such a facility is constructed, it will use the Paraho Process.
The Company will not be able to generate revenues from the
Paraho Process unless it succeeds in financing the construction
of a commercial facility, or is able to license the technology
to third parties for construction of such a facility. Due to
the Company's inability to obtain financing to date, and the
lack of any interest by third parties in licensing the
technology, the Company does not expect it will realize any
revenues from the Paraho Process in the foreseeable future.
Even if it succeeds in financing a facility or licensing the
technology to third parties, due to the lengthy lead time
necessary to engineer and construct a commercial oil shale
facility, as well as the constraints imposed by governmental
regulations, at best, it will be a number of years before any
royalties may be earned by New Paraho under any licenses it may
grant for the use of the Paraho Process.
The Paraho Process includes an entire system for the
processing of oil shale, including mining, crushing, retorting
and disposing of the shale. Protection of the Paraho Process is
based upon several patents covering equipment, process
conditions and methods of operating a retort, many of which have
expired. The Company expended resources in prior years to apply
for new patents as a result of the Department of Energy
sponsored PON Commercial design project initiated by Paraho
Development Corporation. As a result of these efforts, on
August 14, 1990, the U.S. Patent Office issued this patent as
#4,948,468. Management believes that the interrelation of the
remaining patents, in addition to this new patent should provide
adequate protection of the Paraho Process through the year 2007.
Along with the patent protection, New Paraho has developed
proprietary know-how and technical data and experience regarding
the design, construction and operation of retorts and related
facilities. Such technology and know-how are protected by
confidentiality and patent assignment agreements. The
agreements generally require the maintenance of the
confidentiality of all Paraho Process technology and trade
secrets and require assignment to the Company of all patents
relating to its business or products. New Paraho also has
rights received from ERTL to use the WRI Technology for the
Asphalt Feasibility Program.
SOMAT Technology - While proceeding with the
Asphalt Feasibility Program, the Company developed the SOMAT
(Shale Oil Modified Asphalt Technology) process to further
process crude shale oil into shale oil asphalt modifiers. This
process is proprietary information and the Company seeks to
protect it under patent and trade secrets law.
Governmental Regulation - Environment -
Federal, state and local laws and regulations have a substantial
impact on the development of an oil shale industry.
Environmental concerns include air quality, water usage and
pollution, dust problems, spent shale disposal and land
reclamation. Numerous governmental permits are required in
connection with the construction and operation of one or more
commercial-size retorts and related facilities (including the
mine from which oil shale is extracted). Mining of the oil
shale, which is accomplished using conventional room and pillar
or surface mining methods, presents the usual difficulties
associated with mining methods, including safety considerations.
The Company believes that it and its subsidiaries have received
all permits necessary for them to mine oil shale and to process
it at the Pilot Plant Lease site in support of the Asphalt
Feasibility Program.
Employees - The Company currently has four paid
employees. The Company has no plans to add employees, and will
be required to lay off some or all employees in the future
unless financing for a commercial facility is obtained.
Competition - New Paraho is only one of many
companies that has attempted to develop a workable, economical
process for recovering oil from shale. The adverse conditions
which now exist for the commercial development of oil shale,
when coupled with the absence of federal government incentives,
have caused many of these companies to abandon or to defer
further research and development of their competing technologies
as well as development of their oil shale mineral resource
holdings. Nonetheless, many of the Company's future competitors
may have far greater resources than the Company. If any one of
these companies is successful, its success may significantly
reduce the value of the Paraho Process. Further, it is possible
that new technologies, which could require lower capital costs
or present other advantages, could reduce the value of the
Paraho Process. New Paraho is unable, at this time, to assess
accurately the status of the development or economics of
competing processes, and no assurance can be given that the
Paraho Process will be able to compete effectively with other
processes.
At present, management believes that the Company is the
only producer of a shale oil-derived asphalt material for
testing purposes. The Company's exclusive right to use the WRI
Technology provides protection against competitors using that
technology to produce the material without first obtaining a
license from New Paraho. In addition, the Company believes that
shale oil produced by the Paraho Process used in connection with
the SOMAT Process produces a higher quality and a higher yield
of asphalt modifier than shale oil produced by other processes.
With respect to competing asphalt modifiers, a Federal
program focused on the development of improved asphalt testing
systems and on the development of improved asphalt binders, has
led to a greater demand for improved asphalt quality. Among the
products used to improve the asphalt binder, lime, liquid anti-
strip additives, and polymer modified asphalts are the most
popular and widely used. Based on the results of the laboratory
and actual road tests to date, Paraho believes that SOMAT will
be able to compete effectively with these products. In the case
of lime and liquid anti-strips, SOMAT's competitive advantage
will come through a technically superior product that is priced
comparable to the best performing anti-strip products, and in
the case of the polymer modified products, SOMAT's advantage
will come through comparable, if not superior, technical
performance at a lower price. However, there is no assurance
that competitors will not develop products with performance
characteristics superior to SOMAT.
<PAGE>
Item 2. PROPERTIES
Rio Blanco Properties - On December 17, 1987,
The Oil Shale Corporation, a wholly-owned subsidiary of Tosco
Corporation exercised the Purchase Option on the Rio Blanco
Properties. Details of the transaction are as described in the
discussion of the Asphalt Feasibility Program.
Pilot Plant Lease - On October 15, 1982, Paraho
Development leased 200 acres of private land near Rifle,
Colorado from an individual for an initial term of ten years
with provisions for extensions. The leased land provides a
location for the Company to operate its pilot oil shale retort
facility, and management considers the land to be adequate space
to enable New Paraho to carry out research operations. As
renegotiated on October 8, 1992, the lease calls for an annual
minimum rent of $6,000 and an operational rate of $28,296 per
year. The new lease expires in October, 2002. The rent for the
land at the operational rate for the twelve months ended June
30, 1995 will be prorated on a daily basis.
Utah Oil Shale Lands - New Paraho has acquired
rights to approximately 10,432 acres of oil shale lands in
Uintah County, Utah. Of the total, New Paraho owns an undivided
80% interest in 160 acres in fee. The remaining 10,272 acres
are controlled by New Paraho under State of Utah Leases for oil
shale or under agreements with third parties.
Item 3. LEGAL PROCEEDINGS
None.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not Applicable.
<PAGE>
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCK HOLDER MATTERS
The Company's common stock is traded over-the-counter. The
reported high and low bid prices for each quarterly period since
July 1, 1993 are as follows:
FROM THE NATIONAL DAILY QUOTATION SERVICE
<TABLE>
Bid Prices Asked Prices
High Low High Low
<S> <C> <C> <C> <C>
1993
July 1 through
September 30 .25 .06 .56 .13
October 1 through
December 31 .25 .03 .50 .25
1994
January 1 through
March 31 .06 .03 .31 .25
April 1 through
June 30 .06 .03 .31 .19
July 1 through
September 30 .06 .03 .28 .19
October 3 through
December 30 .06 .02 .28 .13
1995
January 3 through
March 31 .06 .02 .28 .12
April 3 through
June 30 .03 .02 .28 .12
</TABLE>
<PAGE>
The high and low prices specified above represent prices
between broker-dealers. They do not include retail mark-ups and
mark-downs or any commissions to the broker-dealer and may not
reflect prices in actual transactions.
As of July 14, 1992, the Company's stock was deleted from
the NASDAQ Small-Cap Market, because the Company failed to meet
the new bid price requirement. The stock has been only thinly
and sporadically traded, and is now listed on an electronic
bulletin board system.
As of September 1, 1995, the approximate number of
shareholders of record of The New Paraho common stock was 1,100.
New Paraho has never paid dividends on its common stock and
there is no prospect that dividends will be paid in the
foreseeable future. The Company intends to follow its policy of
retaining any earnings to provide funds to offset current
obligations, for additional research and development and for
expansion.<PAGE>
Item 6. SELECTED FINANCIAL DATA
<TABLE>
Statement of
Operations Year Ended Year Ended Year Ended Year Ended Year Ended
Data 6/30/91 6/30/92 6/30/93 6/30/94 6/30/95
_____________________________________________________________________________
<S> <C> <C> <C> <C> <C>
Revenues $ 516,234 $ 287,196 $ 282,028 $ 291,710 $ 495,319
Net Income(Loss) (500,095) (567,879) (1,352,930) (1,297,216) (1,068,172)
Net Income(Loss)
per Share (.01) (.01) (.03) (.03) (.02)
Cash Dividend per
Common Share -- -- -- -- --
Balance Sheet As of As of As of As of As of
Data 6/30/91 6/30/92 6/30/93 6/30/94 6/30/95
______________________________________________________________________________
<S> <C> <C> <C> <C> <C>
Total Assets $5,582,453 $5,250,183 $4,930,698 $4,937,652 $4,469,950
Long Term Debt 3,519,155 3,716,874 4,653,181 6,070,155 6,792,078
</TABLE>
<PAGE>
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - Due to the inability to obtain
financing for a commercial project, the exhaustion of the
Company's existing financial resources, and the fact that the
Company's line of credit will mature on July 1, 1996, the
Company expects that it will not have the funds to continue
operations, and may be required to sell assets or liquidate to
meet its obligations.
The Company realized an increase in working capital of
$84,825 in the fiscal year ended June 30, 1995. Funds were
primarily obtained from sales of asphalt paving material,
borrowing on the promissory note to the Tell Ertl Family Trust,
and from interest and principal payments on the promissory note
from The Oil Shale Corporation. Funds were used primarily for
operating expenses, and research and development related to the
Asphalt Feasibility Program.
On May 1, 1994, the Company was granted an increase in its
line of credit to $5,500,000 by the Trust. Borrowings under
this note are at the discretion of the trustees of the Trust.
The note is due on July 1, 1996. The Company had borrowed
$5,497,119 and owes an additional $1,294,959 in accrued interest
on this note as of June 30, 1995. The Company does not expect
to be able to pay the note when it becomes due.
The Trust has notified the Company that it does not intend
to increase the line of credit, and it is uncertain whether the
Trust will agree to extend the maturity date. Accordingly, the
Company will not have any funds to continue operations unless it
succeeds in obtaining additional financing. Since 1989, the
Company has been seeking to obtain financial commitments to
design, construct, and operate a commercial facility to produce
asphalt. To date, the Company has not received significant
indications of interest, and it currently appears unlikely that
it will succeed in obtaining such financial commitments.
Possible future sources of cash include sales of oil shale-
derived asphalt paving materials and payments on The Oil Shale
Corporation's Promissory Note. Additional future sources of
cash may include revenues from the performance of further
research services or from the use of the Company's pilot plant
retort facility. Management presently does not expect that
significant revenues from these sources will be obtained.
Management believes that the Company's share of payments on The
Oil Shale Corporation's Promissory Note and sale of the
remaining asphalt paving material will be sufficient to cover
projected operating costs for the Asphalt Feasibility Program
for the year ending June 30, 1996, other than debt service on
the note payable to the Trust. The Company does not believe it
will have sufficient revenues to pay operating costs or debt
service on the note payable to the Trust in later years.
Further, if the Trust does not agree to extend the maturity date
of its note beyond July 1, 1996, unless the Company obtains
additional financing (which currently appears unlikely), the
Company will be required to sell assets to repay the note, and
may be required to terminate operations and liquidate.
Capital Resources - New Paraho's current long-term
objectives include research and development related to the
Asphalt Feasibility Program and the Paraho Process, licensing of
the Paraho Process and commercialization of shale oil and shale
oil-derived products. In pursuit of these objectives, New
Paraho incurred costs and expenses of $993,004 in fiscal 1995.
The Company expects to spend approximately $500,000 during
fiscal 1996 to finalize the test market program. This need for
funds will be met by payments received on the TOSCO note, and
sales of SOMAT. At the present time, New Paraho believes that
the most viable option for the continued pursuit of these
aforementioned objectives is the successful completion of the
Asphalt Feasibility Program and subsequent commercialization
efforts. Management has estimated that such a commercial
project would require capital of $54 million. While the Company
has been attempting to seek commitments for such financing, it
has been unable to do so to date, and it currently appears
unlikely that it will succeed in doing so.
Results of Operations
1995 - Revenues in fiscal 1995 consisted
primarily of sales of SOMAT and interest payments on the
promissory note from The Oil Shale Corporation. Costs and
expenses related to research and development of the Asphalt
Feasibility Program. Furthering the test market phase of the
Asphalt Feasibility Program, as well as attempting to finance a
commercial project are expected to be the main operations of the
Company in the near future.
1994 - Revenues in fiscal 1994 consisted mainly
of interest payments on the promissory note from The Oil Shale
Corporation and sales of SOMAT. Costs and expenses related
primarily to research and development of the Asphalt Feasibility
Program.
1993 - Revenues in fiscal 1993 consisted mainly
of interest payments on the promissory note from The Oil Shale
Corporation and sales of SOMAT. Costs and expenses related
primarily to research and development of the Asphalt Feasibility
Program.
<PAGE>
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Index to Financial Statements Page
Report of Independent Auditors 26
Consolidated Balance Sheets at June 30, 27
1995 and June 30, 1994
Consolidated Statements of Operations for 29
the years ended June 30, 1995, 1994
and 1993
Consolidated Statements of 30
Stockholders' Equity (Deficit) for
the years ended June 30, 1995, 1994,
1993 and 1992
Consolidated Statements of Cash flows for 31
the years ended June 30, 1995, 1994
and 1993
Notes to Consolidated Financial Statements 32
<PAGE>
Consolidated Financial Statements
THE NEW PARAHO CORPORATION
Years ended June 30, 1995, 1994 and 1993
with Report of Independent Auditors
<PAGE>
Report of Independent Auditors
The Board of Directors
The New Paraho Corporation
We have audited the accompanying consolidated balance sheets of
The New Paraho Corporation as of June 30, 1995 and 1994, and the
related consolidated statements of operations, stockholders'
equity (deficit), and cash flows for each of the three years in
the period ended June 30, 1995. These financial statements are
the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of The New Paraho Corporation at June 30,
1995 and 1994, and the consolidated results of their operations
and their cash flows for each of the three years in the period
ended June 30, 1995, in conformity with generally accepted
accounting principles.
As discussed in Note 2 to the financial statements, the
Company's recurring losses from operations, net capital
deficiency and inability to obtain financing to construct a
commercially feasible oil shale retort facility raise
substantial doubt about its ability to continue as a going
concern. Management's plan as to these matters are also
described in Note 2. The accompanying financial statements do
not include any adjustments that might result from the out come
of this uncertainty.
August 23, 1995
ERNST & YOUNG LLP<PAGE>
THE NEW PARAHO CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
June 30,
1995 1994
<S> <C> <C>
ASSETS
Current Assets:
Cash $ 130,908 $ 6,561
Accounts Receivable 1,717 24,529
Short-term Investments(Note 5) 20,000 20,000
Inventory 195,394 331,670
Note Receivable (Note 4) 385,390 385,390
Interest Receivable (Note 4) 16,190 17,809
Prepaid Expenses 16,771 17,039
Total Current Assets 766,370 802,998
Plant, Furniture and Equipment (net),
at cost (Note 3) 130,408 174,061
Oil Shale Mineral Properties,
at cost (Note 3) 40,525 40,525
Patent, (net of accumulated amortization
of $10,154 and $8,123 in 1995 and
1994, respectively) 24,368 26,399
Supplies 12,044 12,044
Note Receivable (Note 4) 3,468,510 3,853,900
Certificates of deposit, 27,000 27,000
restricted (Note 5)
Deposits 725 725
Total Assets $4,469,950 $4,937,652
</TABLE>
See accompanying notes
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY (deficit)
<TABLE>
June 30,
1995 1994
<S> <C> <C>
Current Liabilities:
Accounts Payable $ 37,214 $ 147,009
Accrued Liabilities 15,608 27,266
Total Current Liabilities 52,822 174,275
Long-term Liabilities:
Note Payable, related party, including
accrued interest of $1,294,959 and
$725,036 in 1995 and 1994, respectively
(Note 8) 6,792,078 6,070,155
Commitment (Note 9)
Stockholders' Equity (Deficit) (Notes 2 and 10):
Common Stock - $.01 par value,
authorized - 75,000,000 shares;
issued - 50,980,400; outstanding -
50,772,982 509,804 509,804
Par value of common stock issued in
excess of the fair market value of
assets acquired (358,167) (358,167)
Retained earnings (deficit) (2,514,142) (1,445,970)
(2,362,505) (1,294,333)
Less 207,418 shares of common stock
held in treasury, at cost (12,445) (12,445)
Total Stockholders' Equity (deficit) (2,374,950) (1,306,778)
Total liabilities and stockholders'
equity (deficit) $4,469,950 $4,937,652
</TABLE>
See accompanying notes
<PAGE>
THE NEW PARAHO CORPORATION
CONSOLIDATED STATEMENTS OF OPERATION
<TABLE>
Year ended June 30,
1995 1994 1993
<S> <C> <C> <C>
REVENUES:
Asphalt Sales $ 283,969 $ 71,527 $ 23,278
Research and contract services 778 - 14,269
Interest Income 207,128 221,678 242,381
Other 3,444 (1,495) 2,100
495,319 291,710 282,028
COSTS AND EXPENSES:
Asphalt Research 743,482 880,191 1,067,512
General & Administrative 249,522 317,664 271,396
Interest Expense 570,487 391,071 296,050
1,563,491 1,588,926 1,634,958
NET LOSS ($1,068,172) ($1,297,216) ($1,352,930)
NET LOSS PER SHARE ($0.02) ($0.03) ($0.03)
Weighted average shares
outstanding 50,772,982 50,772,982 50,772,982
</TABLE>
See accompanying notes.
<PAGE>
THE NEW PARAHO CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
Par Value
of Common
Stock Issued
in Excess of the
Common Stock Fair Market Value
Shares Amount of Assets Acquired
<S> <C> <C> <C>
Balance at June 30, 1992 50,980,400 $ 509,804 $ (358,167)
Net loss - - -
Balance at June 30, 1993 50,980,400 509,804 (358,167)
Net loss - - -
Balance at June 30, 1994 50,980,400 509,804 (358,167)
Net loss - - -
Balance at June 30, 1995 50,980,400 509,804 (358,167)
Total
Retained Stockholders'
Earnings Treasury Stock Equity
(Deficit) Shares Amount (Deficit)
<S> <C> <C> <C> <C>
Balance at June 30, 1992 1,204,176 207,418 (12,445) 1,343,368
Net Loss (1,352,930) - - (1,352,930)
Balance at June 30, 1993 (148,754) 207,418 (12,445) (9,562)
Net Loss (1,297,216) - - (1,297,216)
Balance at June 30, 1994 (1,445,970) 207,418 (12,445) (1,306,778)
Net Loss (1,068,172) - - (1,068,172)
Balance at June 30, 1995 (2,514,142) 207,418 (12,445) (2,374,950)
</TABLE>
See accompanying notes.
<PAGE>
THE NEW PARAHO CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
Year ended June 30,
1995 1994
<S> <C> <C>
Operating activities
Net Loss ($1,068,172) ($1,297,216)
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation and amortization 45,684 26,987
Change in operating assets and liabilities:
Receivables 24,431 (2,136)
Inventory 136,276 (331,670) -
Prepaid expenses 268 (2,143)
Accounts payable (109,795) (38,191)
Accrued liabilities (11,658) 12,539
Accrued interest and discount on
payable to income certificate holders 569,923 78,974
Net cash used in operating activities (413,043) (1,552,856)
Investing activities
Purchase of plant, furniture and equipment - (105,507)
Payment received on note receivable 385,390 385,390
Short-term investments - -
Net cash provided by investing activities 385,390 279,883
Financing activities
Borrowings under line-of-credit agreement 152,000 1,338,000
Payments to income certificate holders - (87,152)
Net cash provided by financing
activities 152,000 1,250,848
Net increase (decrease) in cash 124,347 (22,125)
Cash at beginning of year $ 6,561 $ 28,686
Cash at end of year $ 130,908 $ 6,561
Supplemental disclosures of cash flow
information:
Interest paid $ - $ 308,000 -
</TABLE>
See accompanying notes.
<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements
June 30, 1995
1. Description of Business and Summary of Accounting Policies
Description of Business
The New Paraho Corporation (the "Company") was incorporated in
December 1985 as a wholly-owned subsidiary of Energy Resources
Technology Land, Inc. ("ERTL"). ERTL capitalized The New Paraho
Corporation with $1,000 and contributed 50% of its interest in oil
shale mineral properties located in Rio Blanco County, Colorado.
Operations of the Company commenced on July 23, 1986.
On July 23, 1986, the Company merged with Paraho Development
Corporation pursuant to Paraho Development Corporation's Plan of
Reorganization ("Plan of Reorganization") under Chapter 11 of the
United States Bankruptcy Code. Shareholders of Paraho Development
Corporation received 5% of the outstanding common stock of the
Company and former creditors of Paraho Development Corporation
received 15% of the common stock of the Company and income
certificates representing a right to a specified percentage of
certain income received by the Company from oil shale mineral
properties located in Rio Blanco County, Colorado (see Note 6).
Following the merger, ERTL holds 80% of the outstanding common
stock of the Company and, accordingly, the Company accounted for
the acquisition of Paraho Development Corporation as a purchase.
The Company, directly and through its subsidiaries, holds patents
and proprietary rights applicable to the retorting of oil from
shale by use of an above-ground, vertical shaft retort. The
Company also has rights to use certain intellectual properties to
test the suitability of shale oil in the production of asphalt. In
addition, the Company owns interests in oil shale lands.
Principles of Consolidation
The consolidated financial statements of the Company include the
accounts of wholly-owned subsidiaries. All significant
intercompany transactions have been eliminated.<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements (continued)
1. Description of Business and Summary of Accounting Policies
(continued)
Plant, Furniture and Equipment, Oil Shale Mineral Properties, and
Patent
Depreciation is provided on a straight-line basis over the
estimated useful lives of the assets, which range from three to ten
years. Amortization is provided on a straight-line basis over
seventeen years, the estimated useful life of the patent.
Inventory
Inventory consists of shale oil asphaltic cement and is stated at
the lower of cost or estimated net realizable value.
Net Loss Per Share
Loss per share is computed based on the weighted average number of
common shares outstanding during the period.
Income Taxes
The Company has elected to file a consolidated federal income tax
return with its parent, ERTL. The consolidating companies have
implemented a tax allocation policy. Under this policy, the
federal income tax provision is computed on a separate return
basis and the companies receive reimbursement to the extent their
losses and other credits result in a reduction of the consolidated
tax liability, or are charged for their share of the consolidated
tax liability.
Effective July 1, 1993, the Company changed its method of
accounting for income taxes from the deferred method to the
liability method required by Financial Accounting Standards Board
Statement No. 109, "Accounting for Income Taxes" ("FAS No. 109").
This change in accounting method has no material effect on the
Company's accounting for income taxes.
Statement of Cash Flows
For purposes of the statement of cash flows, the Company considers
all highly liquid debt instruments purchased with an initial
maturity of three months or less to be cash equivalents.<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements (continued)
1. Description of Business and Summary of Accounting Policies
(continued)
Concentration of Credit Risk
The Company's note receivable is the result of a sale of certain
property and mineral rights in fiscal year 1988 (Note 4). The note
is secured by the assets sold.
2. Ability to Continue as a Going Concern
As of June 30, 1995, the Company has an accumulated deficit of
$2,514,142 and a net capital deficiency of $2,374,950. Ultimately,
the Company's ability to continue as a going concern is dependent
on obtaining sufficient financing to construct a commercially
feasible oil shale retort facility. Management will continue to
seek sources for this financing. Management believes proceeds from
the note receivable (see Note 4) and the sale of inventory will be
sufficient to fund operations through June 30, 1996.
These financial statements do not include any adjustments to
reflect the possible effects on the recoverability and
classification of assets or the amount and classification of
liabilities that may result from the possible inability of the
Company to continue as a going concern.
3. Plant, Furniture and Equipment and Oil Shale Mineral Properties
Plant, furniture and equipment at June 30, 1995 and 1994 consist
of:
<TABLE>
1995 1994
<S> <C> <C>
________________________________
Retort facility and related equipment $ 244,502 $ 244,502
Other equipment 37,603 37,603
Office furniture and equipment 42,085 42,085
324,190 324,190
Less accumulated depreciation (193,782) (150,129)
$ 130,408 $ 174,061
</TABLE>
Oil shale mineral properties at June 30, 1995 and 1994 consist of:
<TABLE>
1995 1994
<S> <C> <C>
________________________________
Paraho Ute Project:
Utah state leasehold rights $ 24,525 $ 24,525
Utah fee land 16,000 16,000
$ 40,525 $ 40,525
</TABLE>
<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements (continued)
3. Plant, Furniture and Equipment and Oil Shale Mineral Properties
(continued)
Oil shale mineral properties consist of approximately 10,272 acres
of Utah state leases and an 80% undivided interest in 160 acres of
Utah fee land. Annual renewal rental payments of $10,272 are
required on the Utah state leases.
4. Note Receivable and Sale of Property and Mineral Rights
On December 17, 1987, Tosco Corporation's wholly-owned subsidiary,
The Oil Shale Company, exercised its option, granted in 1963 by the
Company's parent, to acquire from the Company its 50% ownership
interest in certain property and mineral rights for $6,355,850.
The Company received $575,000 cash and a note receivable in the
amount of $5,780,850 on closing. The note is receivable in fifteen
equal annual installments of $385,390 which commenced December 17,
1990. The principal balance bears interest at 5% receivable
quarterly.
5. Certificates of Deposit
On June 23, 1994, the Company obtained a $20,000 one-year
certificate of deposit to secure a letter of credit. On June 23,
1995, the certificate of deposit was reinvested in another one-year
certificate of deposit which bears interest at 5.1%.
The Company also has $27,000 in certificates of deposit which are
restricted under terms of a reclamation performance bond and will
be released following completion of mining activities and
restoration of mining sites.
6. Payable to Income Certificate Holders
Pursuant to the merger and Plan of Reorganization (see Note 2),
certain creditors of Paraho Development Corporation were issued
income certificates with face values equal to 50% or, in specified
court approved circumstances, a varying percentage of the debt
owed. These certificates were unsecured, noninterest-bearing
obligations of the Company which were to expire December 31, 1995,
and were payable from 30% of any future proceeds received by the
Company from the Rio Blanco County oil shale mineral properties
(see Note 4). Amounts payable resulting from the obligation under
the income certificates were recognized when the related revenue
was recognized. These certificates were paid off during 1994.
<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements (continued)
7. Income Taxes
The Company accounts for income taxes in conformity with FAS No.
109. Under the provisions of FAS No. 109, a deferred tax liability
or asset (net of a valuation allowance) is provided in the
financial statements by applying the provisions of applicable tax
laws to measure the deferred tax consequences of temporary
differences which result in net taxable or deductible amounts in
future years as a result of events recognized in the financial
statements in the current or preceding years.
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for income
tax purposes. Significant components of the Company's deferred tax
liabilities and assets are as follows:
<TABLE>
1995 1994
<S> <C> <C>
__________________________________
Deferred tax liabilities:
Tax over book depreciation $ 293,614 $ 286,940
Total deferred tax liabilities 293,614 286,940
Deferred tax assets:
Tax net operating loss carryforwards 3,708,153 3,304,830
Business credits and other 153,876 158,237
Tax basis of property and equipment
greater than book 800,459 800,459
Total deferred tax assets 4,662,488 4,263,526
Valuation allowance for deferred tax assets (4,368,874) (3,976,586)
Net deferred tax assets 293,614 286,940
Net deferred tax assets/liabilities $ - $ -
</TABLE>
The Company has operating loss carryforwards for income tax
purposes of approximately $10,023,000, which expire in varying
amounts from 2000 to 2010. In addition, the Company has general
business credit carryovers for income tax purposes of approximately
$150,000, which expire in varying amounts from 1995 to 2004.
The Company is included, for federal income tax purposes, in the
consolidated income tax return filed by ERTL. Income tax operating
loss carryforwards and general business credit carryovers of
approximately $677,000 and $106,000, respectively, are a result of
the pre-acquisition operations of Paraho Development Corporation
and may only be applied against future taxable income of the
Company.<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements (continued)
8. Related Party Transactions
In June 1987, the Company obtained a $2,500,000 unsecured line of
credit from the Tell Ertl Family Trust, which holds 47% of the
outstanding common stock of ERTL. This line was increased to
$5,500,000 in May 1994 and amended in June 1995 to reflect a
maturity date of July 1, 1996. The note bears interest at 2% over
prime (effective rate of 11% at June 30, 1995) and provides that
the Trust reserves the right to approve activities and budgets of
the Company during the term of the promissory note.
For the year ended June 30, 1995, the Company paid professional
fees totalling $36,000 to an affiliate of a director.
9. Operating Lease
The lease for land upon which the pilot plant is located was
renegotiated and extended to October 1, 2002. Future minimum lease
payments for this land are as follows:
<TABLE>
<S> <C>
1996 $ 6,000
1997 6,000
1998 6,000
1999 6,000
2000 6,000
Thereafter 13,500
$ 43,500
</TABLE>
The lease provides for fixed payments of $28,296 per year prorated
on a daily basis for periods when the pilot plant is in operation.
The pilot plant commenced operations on November 10, 1992. Total
lease payments relating to this lease were $6,000, $26,521, and
$17,635 for 1995, 1994 and 1993, respectively.
10. Stock Option
On January 1, 1991, the Company granted an officer of the Company
an option to purchase up to 1,150,000 shares of Common Stock for
$.05 per share. Of the 1,150,000 shares included in the grant,
150,000 shares became exercisable on July 1, 1991. The remaining
1,000,000 shares are exercisable in increments of 250,000 shares to
500,000 shares upon the occurrence of specified events. The option
expires ten years from the date of grant.<PAGE>
The New Paraho Corporation
Notes to Consolidated Financial Statements (continued)
10. Stock Option (continued)
The Company recorded $6,600 of compensation expense in 1991 related
to the 150,000 shares that became exercisable on July 1, 1991. The
remaining options to purchase 1,000,000 shares will be accounted
for as a variable plan and compensation, if any, will be determined
based on the market value of the Company's stock at the dates the
specified events occur and thus the number of shares subject to the
option is known.
<PAGE>
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Not Applicable.
<PAGE>
PART III
ITEMS 10 THROUGH 13
Items 10 through 13 are incorporated by reference from the
sections entitled "Election of Directors and Officers", "Amount and
Nature of Beneficial Ownership", and "Remuneration and Other
Transactions with Management and Others" in the Registrant's
definitive proxy statement for its annual meeting to be held in
December, 1995 which proxy statement shall be filed no later than
120 days after the end of the Company's most recent fiscal year.
<PAGE>
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
REPORTS ON FORM 8-K
The Index to Financial Statements is at Page 24. No financial
statements or financial statement schedules are incorporated by
reference. All schedules are omitted since the required
information is not present or is not present in amounts sufficient
to require submission of the schedules, or because the information
required is included in the consolidated financial statements and
notes thereto.
There were no reports on Form 8-K during the last quarter of the
period covered by this Annual Report.
Exhibit Index
Exhibit No. Description
(3) Articles of Incorporation and By-Laws. Reference is made to
Exhibits 4 and 5 to Registrant's Form 8-K filed on July 23,
1986 (file number 0-8536) that is incorporated herein by
reference.
(10) (a) William Clough Lease, dated October 15, 1982 for land
near Rifle, Colorado. Reference is made to Exhibit
10(e) to Registrant's Annual Report on form 10-K for
the Fiscal Year Ended August 31, 1982 that is
incorporated herein by reference.
(10)(a)(i) Amendment to William Clough Lease effective October 1,
1986. Reference is made to exhibit (10)(a)(i) to
Registrant's Annual Report on Form 10-K for the Fiscal
Year Ended June 30, 1987 that is incorporated herein
by reference.
(10)(a)(ii) Amendment to William Clough Lease effective October 8,
1992.
(10) (b) State of Utah Mineral Lease No. 35894 assigned to
Paraho, with assignment. Reference is made of Exhibit
13(c) to Registrant's Registration Statement dated
June 17, 1980 on Form S-1 (file number 2-67272) that
is incorporated herein by reference.
(10) (c) State of Utah Mineral Lease No. 35891 assigned to
Paraho, with assignment. Reference is made to Exhibit
10(d) for the Fiscal Year Ended August 31, 1981 that
is incorporated herein by reference.
(10) (e) Commitment to lease or otherwise convey from Gulf.
Reference is made to Exhibit 10(h) to Registrant's
Annual Report on Form 10-K for the Fiscal Year Ended
August 31, 1981 that is incorporated herein by
reference.
(10) (f) Debtors Joint Plan of Reorganization (Case No. 86
B1593G) dated February 25, 1986. Reference is made to
Exhibit 1 to Registrant's 8-K dated July 23, 1986 that
is incorporated herein by reference.
(10) (g) Debtors Disclosure Statement dated June 3, 1986.
Reference is made to Exhibit 2 to Registrant's 8-K
dated July 23, 1986 that is incorporated herein by
reference.
(10) (h) Plan and Agreement of Merger between and among ERTL,
Paraho Development Corporation, a Colorado corporation
and Paraho Development Corporation, a Delaware
corporation dated December 30, 1985, with amendments
dated February 18, 1986 and July 23, 1986. Reference
is made of Exhibit 3 to Registrant's 8-K dated July
23, 1986 that is incorporated herein by reference.
(10) (j) Employment Agreement with Larry A. Lukens, dated
January 1, 1991. Reference is made of Exhibit 10(j)
to Registrant's Annual Report on Form 10-K for the
Fiscal Year Ended June 30, 1991 that is incorporated
herein by reference.
(10)(j)(i) Stock Option Agreement with Larry A. Lukens, dated
January 1, 1991. Reference is made of Exhibit
10(j)(i) to Registrant's Annual Report on Form 10-K
for the Fiscal Year Ended June 30, 1991 that is
incorporated herein by reference.
(10) (k) Promissory Note from The Oil Shale Corporation in the
principal sum of $11,561,699.50, dated December 17,
1987. Reference is made of Exhibit 10(k) to
Registrant's Annual Report on Form 10-K for the Fiscal
Year Ended June 30, 1988 that is incorporated herein
by reference.
(10) (l) Promissory Note to the Tell Ertl Family Trust in the
principal sum of $3,000,000 dated August 29, 1989.
Reference is made of Exhibit 10(l) to Registrant's
Annual Report on Form 10-K for the Fiscal Year ended
June 30, 1989 that is incorporated herein by
reference.
(10)(l)(i) Amendment to the Promissory Note to the Tell Ertl
Family Trust, dated September 19, 1990. Reference is
made of Exhibit 10(l)(i) to Registrant's Annual Report
on Form 10-K for the Fiscal Year Ended June 30, 1991
that is incorporated herein by reference.
(10)(l)(ii) Amendment to the Promissory Note to the Tell Ertl
Family Trust, dated August 26, 1992. Reference is made
of Exhibit (10)(l)(ii) to Registrant's Annual Report
on Form 10-K for the Fiscal Year ended June 30, 1992,
that is incorporated herein by reference.
(10)(l)(iii) Amendment to the Promissory Note to the Tell
Ertl Family Trust, dated August 20, 1993. Reference is
made of Exhibit (10)(l)(iii) to Registrant's Annual
Report on Form 10-K for the Fiscal Year ended June 30,
1993, that is incorporated herein by reference.
(10)(l)(iv) Amendment to the Promissory Note to the Tell Ertl
Family Trust, dated May 1, 1994. Reference is made of
Exhibit (10)(l)(iv) to Registrant's Annual Report on
Form 10-K for the Fiscal Year ended June 30, 1994,
that is incorporated herein by reference.
(10)(l)(v) Amendment to the Promissory Note to Tell Ertl Family
Trust, dated June 1, 1995.
(10) (m) State of Utah Mineral Lease No. 42360 assigned to New
Paraho, with assignment. Reference is made of Exhibit
10(m) to Registrant's Annual Report on Form 10-K for
the Fiscal Year ended June 30, 1990 that is
incorporated herein by reference.
(10) (n) State of Utah Mineral Lease No. 42362 assigned to New
Paraho, with assignment. Reference is made of Exhibit
10(n) to Registrant's Annual Report on Form 10-K for
the Fiscal Year ended June 30, 1990 that is
incorporated herein by reference.
(10) (o) State of Utah Mineral Lease No. 42363 assigned to New
Paraho, with assignment. Reference is made of Exhibit
10(o) to Registrant's Annual Report on Form 10-K for
the Fiscal Year ended June 30, 1990 that is
incorporated herein by reference.
(10) (p) State of Utah Mineral Lease No. 42477 assigned to New
Paraho, with assignment. Reference is made of Exhibit
10(p) to Registrant's Annual Report on Form 10-K for
the Fiscal Year ended June 30, 1990 that is
incorporated herein by reference.
(10) (q) State of Utah Mineral Lease No. 42478 assigned to New
Paraho, with assignment. Reference is made of Exhibit
10(q) to Registrant's Annual Report on Form 10-K for
the Fiscal Year ended June 30, 1990 that is
incorporated herein by reference.
(10) (s) State of Utah Mineral Lease No. 42838 assigned to New
Paraho, with assignment. Reference is made of Exhibit
10(s) to Registrant's Annual Report on Form 10-K for
the Fiscal Year ended June 30, 1990 that is
incorporated herein by reference.
(10) (t) State of Utah Mineral Lease No. 46377 granted to New
Paraho.
(10) (u) State of Utah Mineral Lease No. 46378 granted to New
Paraho.
The Company will furnish to shareholders a copy of any exhibit upon
request and the payment of five cents per page for copying costs.
<PAGE>
Pursuant to the requirements of Section 13 or 15(d) 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.
THE NEW PARAHO CORPORATION
(Registrant)
By:/s/ Joseph L. Fox
Joseph L. Fox
President
Date: September 28, 1995
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.
/s/Joseph L. Fox Principal Executive 9/28/95
Joseph L. Fox Officer and Director
/s/Theo Ertl Chairman of the 9/28/95
Theo Ertl Board of Directors
/s/Jann Ertl Director 9/28/95
Jann Ertl
/s/Jill Ertl Director 9/28/95
Jill Ertl
/s/Buff Ertl Palm Director 9/28/95
Buff Ertl Palm
/s/Twig Ertl Director 9/28/95
Twig Ertl
/s/Larry A. Lukens Director 9/28/95
Larry A. Lukens
<PAGE>
/s/William Murray, Jr. Director 9/28/95
William Murray, Jr.
/s/Adam A. Reeves Director 9/28/95
Adam A. Reeves
/s/Peter L. Richard Director 9/28/95
Peter L. Richard
/s/Anne M. Smith Controller 9/28/95
Anne M. Smith
EXHIBIT (10)(l)(v)
June 1, 1995
WE, THE UNDERSIGNED, agree that the Promissory Note, between
The New Paraho Corporation and the Tell Ertl Family Trust, dated
August 29, 1989, and attached hereto, has been amended to state a
due date of July 1, 1996, and a total principal amount of $5,500,000.
TELL ERTL FAMILY TRUST THE NEW PARAHO CORPORATION
BY /s/ Theo Ertl BY /s/ Joseph L. Fox
Theo Ertl Joseph L. Fox
Co-Trustee President
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-END> JUN-30-1995
<CASH> 130,908
<SECURITIES> 20,000
<RECEIVABLES> 1,717
<ALLOWANCES> 0
<INVENTORY> 195,394
<CURRENT-ASSETS> 766,370
<PP&E> 324,190
<DEPRECIATION> 193,782
<TOTAL-ASSETS> 4,469,950
<CURRENT-LIABILITIES> 52,822
<BONDS> 0
<COMMON> 509,804
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 4,469,950
<SALES> 283,969
<TOTAL-REVENUES> 495,319
<CGS> 0
<TOTAL-COSTS> 743,482
<OTHER-EXPENSES> 249,522
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 570,487
<INCOME-PRETAX> (1,068,172)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,068,172)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,068,172)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> (.02)
</TABLE>
