SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
For Annual and Transition Reports
Pursuant to Sections 13 or 15(d) of the
Securities Exchange Act of 1934
(Mark One)
[X] Annual report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (No Fee Required).
For the fiscal year ended June 30, 1997 or
[ ] Transition report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (No Fee Required)
For the transition period from ___________to __________.
Commission File No. 1-8680
HIGH PLAINS CORPORATION
(Exact name of registrant as specified in its charter)
Kansas 48-0901658
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 W. Douglas, Suite #820, Wichita, Kansas 67202
(Address and zip code of principal executive offices)
(316) 269-4310
(Registrant's telephone number, including area code)
Securities Registered Pursuant to Section 12 (b) of the Act:
NONE
Securities Registered Pursuant to Section 12 (g) of the Act:
Common Stock, $0.10 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 twelve (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 ninety (90) days.
YES X NO
<PAGE>
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of the 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 [ ].
As of June 30, 1997, there were 15,985,444 outstanding common
shares of the Registrant. As of June 30, 1997, the aggregate
market value of voting stock of High Plains Corporation held by
nonaffiliates was approximately $63,514,287.
Documents Incorporated by Reference:
Portions of the Registrant's definitive Proxy Statement for the
1997 Annual Meeting of Stockholders (the "Proxy Statement"), which
is anticipated to be filed with the Securities and Exchange
Commission within 120 days after the end of the Registrant's
fiscal year end, are incorporated by reference in Part III.
Portions of the Registrant's 1997 Annual Report to Stockholders
for the fiscal year ended June 30, 1997 (the "Annual Report")
which is anticipated to be filed with the Securities and Exchange
Commission within 120 days after the end of the Registrant's
fiscal year end, are incorporated by reference in Parts I, II and IV.
<PAGE>
PART I
Item 1 BUSINESS
High Plains Corporation (the "Company") was incorporated under the
laws of the State of Kansas on February 28, 1980. The Company's
principal offices are located at 200 W. Douglas, Suite 820,
Wichita, Kansas 67202 and its telephone number is (316) 269-4310.
(Financial information concerning the Company's operations is
incorporated by reference from Management's Discussion and
Analysis of Financial Condition and Results of Operations
(Management's Discussion and Analysis) and the Financial
Statements and Notes thereto in the Company's Annual Report.)
The Company manufactures and sells ethanol for blending with
gasoline as a motor fuel. The Company believes it is currently
the sixth largest ethanol producer in the United States. Ethanol
increases the oxygen level in gasoline and reduces pollutants,
including carbon monoxide and hydrocarbon particulate emissions.
Industry sources estimate that 1.1 billion gallons of ethanol were
used to oxygenate United States fuel supplies in 1996. In
addition, the Company sells distiller's grain (DDG), the primary
by-product of ethanol production. Selling prices of DDG generally
vary with sorghum and corn prices. The primary markets for the
Company's DDG continues to be manufacturers of animal and pet
foods, and direct consumers such as feedlots and dairies.
The Company operated two ethanol production facilities, one
located in Colwich, Kansas and the other in York, Nebraska. The
Company's ethanol production capacity at the Colwich plant exceeds
18 million gallons per year and production capacity at the York
facility is approximately 35-40 million gallons per year. Actual
ethanol production in fiscal 1996 and 1997, was below capacity due
to the temporary shutdown of the plants in May 1996 through
September 1996 for the Colwich plant and May 1996 through October
1996 for the York facility. (For information regarding the
temporary shutdown of the Company's plants see "Temporary Shutdown
of Plant Operations" discussion in Management's Discussion and
Analysis in the Company's Annual Report which is incorporated
herein by reference.)
During fiscal 1997 and in prior years, the Company has typically
maintained sufficient on-site grain storage for three to five days
of continuous production. During fiscal 1997, the Company entered
into an exclusive grain supply agreement with Centennial Trading,
LLC for the procurement of all its grain requirements. The Company
believes this agreement eliminates the need to buy and store grain
offsite. (Also see the discussion of raw materials in
Management's Discussion and Analysis in the Company's Annual
Report, which is incorporated by reference herein.)
<PAGE>
The Company's production process depends upon a substantial
uninterrupted supply of natural gas. The Company has contracted
with one natural gas provider to supply both its Colwich and York
plants and the Company believes these supplies will be sufficient
for its production needs. If this source of natural gas supply is
interrupted, the Company believes alternative supplies could be
contracted with little or no interruption to the Company's normal
operations due to the competitive nature of the natural gas
market. Other materials used in the production of ethanol are
readily available from numerous suppliers.
In addition, the Company is dependent on rail transportation to
ship its ethanol and DDG to its customers. Any interruption of
rail transportation due to a rail strike or any other circumstance
would have a significant detrimental effect on the Company's
operations. During the latter part of fiscal 1997 the Company
experienced a slow down in railcar movement as a result of a
merger between two major railroad companies. This slow down has
created some minor delays in deliveries of product. However,
these delays are believed to be temporary and symptomatic of the
railway system for all shippers, at this time.
Historically, the maximum finished ethanol inventory which the
Company has attempted to keep in stock has equaled approximately
four to five days of production. Also, typical payment terms in
the industry are "Net 10 days from delivery". These low
inventories of finished goods and quick payment terms from
customers generally help to minimize the working capital needs of
the Company. At June 30, 1997, the Company's ethanol inventory
levels met or exceeded its normal inventory maximum levels, due to
accumulation of inventory resulting from a slowdown in railcar
deliveries.
The market price of ethanol is not related to grain prices, but
has historically been determined by gasoline, octane enhancers and
oxygenates prices plus federal tax incentives. Therefore, High
Plains is generally not able to compensate for increases in the
cost of grain feedstock through upward adjustments in prices
charged for its ethanol. (For information regarding the
seasonality of the Company's business see "Seasonality" discussion
in Management's Discussion and Analysis in the Company's Annual
Report which is incorporated herein by reference.)
For the fiscal year ended June 30, 1997, the Company's sales to
three customers represented in the aggregate approximately 43.8%
of the Company's total product sales and revenues. The Company's
DDG production is brokered under an exclusive agreement with
ConAgra, Inc. This exclusive agreement automatically renews for
successive one-year terms unless written notice of termination is
issued 90 days prior to the end of a term.
The Company is in direct competition with other ethanol producers,
many of which have greater resources than the Company. The
largest ethanol producers include Archer Daniels Midland, Cargill,
Minnesota Corn Processors and New Energy Co. of Indiana which are
<PAGE>
capable of producing approximately 700 million, 100 million, 115
million and 75 million gallons of ethanol per year, respectively.
In addition, there are several other competitors of a similar
size and with similar resources to the Company. Recent estimates
place total domestic ethanol production capacity at 1.5 billion
gallons per year. Additionally, industrial grade ethanol
production has increased in recent years. This is a result of
Archer Daniels Midland, other producers, and the Company diverting
a portion of existing production capacity from fuel grade
production to industrial grade products. The Company is unable to
predict what effect these changes in production will have on the
demand and price of fuel grade or industrial grade ethanol. (Also
see the discussion of ethanol production in Management's
Discussion and Analysis in the Company's Annual Report, which is
incorporated herein by reference.)
The Company competes with the other ethanol producers on the basis
of price and, to a lesser extent, delivery and service. High
Plains believes that it is able to compete favorably with other
ethanol producers due to its proximity to ample grain supplies and
due to the efficiencies of its plants. The Company also believes
that its locations offer an advantage over other ethanol producers
in that the Company has ready access by rail to growing ethanol
markets, which reduces its cost of sales.
The Company is also in competition with producers of MTBE, a
petrochemical derived from methanol which costs less to produce
than ethanol. Many major oil companies produce MTBE, and because
it is petroleum based, its use is strongly supported by such oil
companies. These companies have significant resources to market
MTBE and to influence legislation and public perception of MTBE.
These companies also have sufficient resources to begin production
of ethanol should they choose to do so.
The Company is subject to extensive environmental regulation at
the federal, state and local levels. Air quality at the Colwich
plant is regulated by the Environmental Protection Agency and the
Division of Environment of the Kansas Department of Health and
Environment (the "KDHE"). The KDHE regulates emission of volatile
organic compounds into the air. Volatile organic compound
emissions are tested on a monthly basis at the Colwich plant, and
the Company must submit semi-annual reports to the KDHE regarding
these emissions tests. The Company is required to obtain an air
operating permit from the KDHE and must obtain KDHE approval to
make plant alterations that could change the emission levels. The
KDHE also regulates the water usage, waste water discharge and
hazardous waste at the Colwich plant under Kansas water pollution
control and hazardous waste laws. Water usage and waste water
effluent quality are tested daily. Monthly reports regarding
water usage and quality are filed with the KDHE. The Company is
also required to submit periodic reports pursuant to the Kansas
and Federal Emergency Planning Community Right-to-Know Act. At
the local level, the Company files semi-annual reports with the
Sedgwick County Community Health Department regarding air quality
at the Colwich plant.
<PAGE>
The York facility is subject to similar environmental regulations
at the federal, state and local level. Air quality at the York
plant is regulated by the Environmental Protection Agency and the
Nebraska Department of Environmental Quality (the "NDEQ"). The
Company submits various reports throughout the year concerning
emissions of volatile compounds. The Company was required to
obtain an air operating permit from the NDEQ and must obtain
approval to make any plant alterations that could change the
emission levels. The NDEQ also regulates waste water discharge at
the York Plant. Waste water effluent quality is tested daily, and
monthly reports are filed with NDEQ. The York facility is also
required to submit periodic reports pursuant to the Nebraska and
Federal Emergency Planning Community Right-to-Know Act. The
Company has air quality permits, water discharge permits, and all
other environmental permits required for operations at the York
location.
At June 30, 1997, the Company employed 104 persons. These
included 42 employees at the Colwich, Kansas plant, 55 employees
at the York, Nebraska plant, and 7 employees in the Wichita,
Kansas corporate office. The total number of employees is
significantly higher compared to the prior year due to employees
furloughed during the temporary shutdown of both of the Company's
production facilities in May, 1996. (For information regarding
the temporary shutdown of the Company's plants see "Temporary
Shutdown of Plant Operations" discussion in Management's
Discussion and Analysis in the Company's Annual Report which is
incorporated by reference herein.)
Item 2 PROPERTIES
The Company's principal executive offices at 200 W. Douglas, Suite
820, Wichita, Kansas are leased and cover approximately 2,800
square feet.
The Company presently owns the approximately 70 acres of land and
the improvements thereon which comprise its Colwich, Kansas plant.
The Company also owns approximately 142 acres of land and the
improvements thereon which comprise its York, Nebraska facility.
The Company's primary lender holds a mortgage on approximately 59
acres of land where the York facility is situated and on the
ethanol production plant itself, as security for a loan to the
Company.
Item 3 LEGAL PROCEEDINGS
Commodity Specialist Company, (CSC) is a distributor of
agricultural products which, from 1988 until April 1994, marketed
and sold DDG produced by the Company. A dispute developed between
the Company and CSC after the termination of the contract under
which CSC sold the Company's DDG. In early September 1995, the
<PAGE>
Company filed suit in the U.S. District Court for the District of
Kansas, against CSC in an attempt to collect approximately
$110,000 which the Company believes it is owed by CSC for DDG sold
but not paid for by CSC. Subsequently, CSC filed a suit in the
U.S. District Court for the District of Minnesota, Fourth
Division, against the Company claiming damages in excess of $1.2
million for lost profits, costs and expenses allegedly resulting
from the termination of the contract and from the Company's
alleged delivery of contaminated DDG to CSC for re-sale. The two
cases have now been consolidated for trial in the Minnesota Court.
No reserves have been made for fiscal years 1995, 1996, or 1997
for any amounts which may be payable to CSC; although for
accounting purposes, a receivable of approximately $100,000 due
from CSC to the Company was written down in fiscal 1994. The
Company's product liability insurance carrier has taken the
position that its policy does not cover the claims made by CSC.
Currently, the Company is vigorously defending the action filed by
CSC. The Company believes that the ultimate resolution of this
dispute will not have a material adverse effect on the Company's
financial condition.
On March 22, 1996, the Company filed suit against Summit Resource
Management, Inc., Commodity Trading Incorporated, and Abbott
Laboratories, in the United States District Court for the District
of Kansas, as Civil Action No. 96-1105-FGT. The suit alleges that
the defendants are liable to the Company for damages suffered as a
result of their sale to the Company of contaminated alcohol, which
was processed into the Company's DDG by-product, and which caused
damage to certain of the Company's customers who purchased this
DDG for cattle feed. All damage claims with the Company's DDG
customers have now been settled (except for the CSC litigation
described above). As a result of this incident, the Company
recorded expenses totaling $967,848 through fiscal 1995. The
current suit by the Company against the providers of the
contaminated alcohol seeks to recover these damages, as well as
other losses and expenses incurred by the Company in connection
with this incident. No affirmative claims have been made against
the Company by the defendants in this lawsuit. At June 30, 1997
the Company had reached a compromise settlement with one of the
defendants, Abbott Laboratories, who has now been dismissed as a
defendant in the suit.
The Company is also involved in one other pending lawsuit which
has arisen in the course of normal business operations, but which
is not expected to have a material adverse effect on the Company's
financial condition.
Item 4 SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS
No matters were submitted to a vote of the stockholders of the
Company during the fourth quarter of the fiscal year ended June
30, 1997.
<PAGE>
PART II
Item 5 MARKET FOR THE REGISTRANT'S COMMON EQUITY
AND RELATED SECURITY HOLDER MATTERS
The Company's Common Stock is traded on the NASDAQ National Market
System under the symbol HIPC.
The number of holders of record of the Company's common stock as
of September 22, 1997, was approximately 8,683 determined by an
examination of the Company's transfer book and through broker
search.
The Company has not declared or paid any cash dividends on its
Common Stock since its organization in 1980.
The Company has no current plans to declare or pay any cash
dividends in the foreseeable future. The payment and rate of
future cash dividends on the Company's Common Stock, if any, would
be subject to review by the Board of Directors in light of the
Company's financial condition, results of operations, capital
requirements and other factors deemed relevant at that time.
Additional information relating to this item, including
historical market prices for the Company's Common Stock, is hereby
incorporated by reference from the "Market For Registrant's Common
Equity" section of the 1997 High Plains Corporation Annual Report
to Stockholders for the year ended June 30, 1997 which is
anticipated to be filed with the Securities and Exchange
Commission within 120 days after the end of the Company's fiscal
year ended June 30, 1997.
Item 6 SELECTED FINANCIAL DATA
The information relating to this item is hereby incorporated by
reference from the "Five Year Summary of Selected Financial Data"
in the 1997 High Plains Corporation Annual Report to Stockholders
for the year ended June 30, 1997 which is anticipated to be filed
with the Securities and Exchange Commission within 120 days after
the end of the Company's fiscal year ended June 30, 1997.
Item 7 MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information relating to this item is hereby incorporated by
reference from the "Management's Discussion and Analysis" in the
1997 High Plains Corporation Annual Report to Stockholders for the
year ended June 30, 1997 which is anticipated to be filed with the
Securities and Exchange Commission within 120 days after the end
of the Company's fiscal year ended June 30, 1997.
<PAGE>
Item 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information relating to this item is hereby incorporated by
reference from the Financial Statements and Notes thereto in the
1997 High Plains Corporation Annual Report to Stockholders for the
year ended June 30, 1997 which is anticipated to be filed with the
Securities and Exchange Commission within 120 days after the end
of the Company's fiscal year ended June 30, 1997.
Item 9 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
Item 10 DIRECTORS AND EXECUTIVE OFFICERS OF
THE REGISTRANT
Under the securities laws of the United States, the Company's
directors, executive officers, and any persons holding more than
ten percent of the Company's securities are required to report to
the Securities and Exchange Commission and to the NASDAQ National
Market System by a specified date his or her ownership of or
transactions in the Company's securities. To the Company's
knowledge, based solely on information filed with the Company, all
of these requirements have been satisfied, except as noted below
Ronald D. Offutt and Arthur Greenberg each failed to timely file
one Form 4, reflecting a total of one transaction each for the
month of June 1997. The transactions involved the issuance of
stock options to each of the individuals as new directors of the
Company. The Form 4 reflecting these transactions was filed in
September, 1997. Also, Gregory Heuer and Daniel Allison,
management personnel of the Company, failed to file one Form 4
each reflecting a total of two transactions each for the month of
January 1997. The transactions involved the purchase of stock
through an employee stock purchase plan. The Form 4's listing
these transactions were filed in March 1997.
The balance of information relating to this item is hereby
incorporated by reference from the "Directors and Executive
Officers" section of the High Plains Corporation definitive Proxy
Statement for the 1997 Annual Meeting of Stockholders, which is
anticipated to be filed with the Securities and Exchange
Commission within 120 days after the end of the Company's fiscal
year ended June 30, 1997.
Item 11 EXECUTIVE COMPENSATION
The information relating to this item is hereby incorporated by
reference from the "Executive Compensation" section of the High
Plains Corporation definitive Proxy Statement for the 1997 Annual
Meeting of Stockholders, which is anticipated to be filed with the
Securities and Exchange Commission within 120 days after the end
of the Company's fiscal year ended June 30, 1997.
<PAGE>
Item 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The information relating to this item is hereby incorporated by
reference from the "Security Ownership of Certain Beneficial
Owners and Management" section of the High Plains Corporation
definitive Proxy Statement for the 1997 Annual Meeting of
Stockholders, which is anticipated to be filed with the Securities
and Exchange Commission within 120 days after the end of the
Company's fiscal year ended June 30, 1997.
Item 13 CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS
The information relating to this item is hereby incorporated by
reference from the "Certain Relationships and Related
Transactions" section of the High Plains Corporation definitive
Proxy Statement for the 1997 Annual Meeting of Stockholders, which
is anticipated to be filed with the Securities and Exchange
Commission within 120 days after the end of the Company's fiscal
year ended June 30, 1997.
PART IV
Item 14 EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K
(a) Documents Filed as a Part of This Report
(1) Financial Statements
Statements of Income - Years Ended
June 30, 1997, 1996, and 1995 *
Statements of Stockholders' Equity - Years
Ended June 30, 1997, 1996, and 1995 *
Balance Sheets - June 30, 1997 and 1996 *
Statements of Cash Flows - Years
Ended June 30, 1997, 1996, and 1995 *
Notes to Financial Statements *
Independent Auditors' Report on Financial Statements *
*Incorporated by reference from the Company's 1997 Annual
Report for the year ended June 30, 1997 which is
anticipated to be filled with the Securities and
Exchange Commission within 120 days after the end of
the Company's fiscal year ended June 30, 1997.
<PAGE>
(2) Financial Statement Schedules
None.
(3) Exhibits
See Index to Exhibits attached hereto and incorporated by
reference herein.
(b) Reports on Form 8-K
During the quarter for which this report is filed, these
reports on Form 8-K have been filed.
May 14, 1997 Disclosure of delay in production of
industrial grade ethanol and extension of
time granted to meet sales contract for
same.
May 14, 1997 Company disclosed appointment of Raymond
G. Friend, President to the Board of
Directors, along with two new outside
directors, Ronald D. Offutt and Arthur
Greenberg.
May 15, 1997 Announced the retirement of then Chairman
and President Stanley E. Larson, election
of Daniel O. Skolness as Chairman of the
Board and promotion of Raymond G. Friend
as President. Additionally, Company
announces cancellation of industrial grade
contract by customer for reasons of force
majeure.
May 22, 1997 Disclosure of earnings per share for the
quarter ending March 31, 1997.
(c) Exhibits
Exhibits are listed in Item 14(a)(3) and filed as part of
this report.
<PAGE>
SIGNATURES
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 in Wichita, Kansas on the 24th day of
September, 1997.
HIGH PLAINS CORPORATION
By:/Raymond G. Friend/
Director/President
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on the behalf of the Registrant and in the capacities
and on the date indicated.
Signature Title Date
Chairman of the
Board and a
/ Daniel O. Skolness / Director September 24, 1997
/ Raymond G. Friend / Director/President September 24, 1997
/ H.T. Ritchie / Director/Secretary September 24, 1997
/ Roger D. Skaer / Director/Treasurer September 24, 1997
/ John F. Chivers / Director September 24, 1997
/ Donald M. Wright / Director September 24, 1997
/ Arthur Greenberg / Director September 24, 1997
/ Ronald Offutt / Director September 24, 1997
<PAGE>
Page 1 of 3
Index to Exhibits
3-1 Articles of Incorporation, as amended, of the Company,
(incorporated herein by reference to Exhibits 3.1
through 3.10 to the Company's Registration Statement on
Form S-1, dated February 9, 1993).
3-2 Bylaws of the Company, as amended, of the Company
(incorporated herein by reference to Exhibits 3.5 and 3.6 to
the Company's Registration Statement on Form S-1, dated
April 18, 1988).
3-3 Certificate of Amendment to Articles of Incorporation
of the Company, dated October 14, 1994 (incorporated herein
by reference to Exhibit 3-7 to the Company's Annual Report
on Form 10-K for the fiscal year ended June 30, 1995).
3-4 Certificate of Amendment of Articles of Incorporation
of the Company, dated November 22, 1994 (incorporated herein
by reference to Exhibit 3-8 to the Company's Annual Report
on Form 10-K for the fiscal year ended June 30, 1995).
3-5 Certificate of Correction of Certificate of Amendment
to Articles of Incorporation of the Company, dated March 22,
1993, (incorporated herein by reference from Exhibit 4-2 to
the Company's Registration Statement on Form S-8, dated
January 16, 1996).
4-1 Form of Common Stock Certificate (incorporated herein
by reference from Exhibit 4-1 to the Company's Registration
Statement on Form S-1, dated April 18, 1988).
10-1 Ethanol production credit agreement with the State of
Nebraska Department of Revenue dated October 9, 1992
(incorporated by reference from Exhibit 10-7 to the
Company's annual filing on Form 10-K, dated June 30, 1994).
<PAGE>
Page 2 of 3
10-2 High Plains Corporation 1990 Stock Option Plan
(incorporated by reference from Exhibit 10-8 to the
Company's Registration Statement on Form S-1, dated February
9, 1993).
10-3 High Plains Corporation 1992 Stock Option Plan
(incorporated by reference from Exhibit 10-14 to the
Company's Registration Statement on Form S-1, dated February
9, 1993).
10-4 Lease dated April 12, 1993 between High Plains
Corporation and Garvey Center L.C. (incorporated by
reference from Exhibit 10-8 to the Company's annual filing
on Form 10-K, dated June 30, 1994).
10-5 Exchange and Release Agreements dated October 18,
1994, providing conversion rights for the 11 1/2% Cumulative
Preferred Stock to Common Stock (incorporated by reference
from Exhibit 10-2 to the Company's quarterly filing on Form
10-Q, dated September 30, 1994).
10-6 Amendment to the Company's 1990 Stock Option Plan, dated
November 18, 1994, increasing the number of shares
available under the plan and granting of additional
options to replace certain options when exercised
(incorporated by reference from Exhibit 10-11 to the
Company's annual filing on Form 10-K dated June 30,
1995).
10-7 Amendment to the Company's 1992 Stock Option Plan,
dated November 18, 1994, increasing the number of shares
available under the plan and granting of additional options
to replace certain options when exercised (incorporated by
reference from Exhibit 10-12 to the Company's annual filing
on Form 10-K dated June 30, 1995).
10-8 Real Estate Installment Agreement dated January 19,
1995, between David J. Vander Griend and the Company,
regarding sale of certain real estate (incorporated by
reference from Exhibit 10-5 to the Company's filing on Form
8-K dated January 19, 1995).
<PAGE>
Page 3 of 3
10-9 Asset Purchase Agreement dated January 19, 1995, between
ICM, Inc. and the Company, regarding sale of various
tangible and intangible property (incorporated by
reference from Exhibit 10-6 to the Company's filing on
Form 8-K dated January 19, 1995).
10-10 Employment Agreement dated April 1, 1995, between the
Company and Raymond G. Friend, for the continuation of
employment through July 1, 2000 (incorporated by reference
from Exhibit 10-18 to the Company's annual filing on Form 10-K
dated June 30, 1995).
10-11 High Plains Corporation 1995 Employee Stock Purchase Plan
(incorporated herein by reference from Exhibit 4-14 to the
Company's Registration statement on Form S-8, dated January
22, 1996).
10-12 High Plains Corporation 1995 Key Management Employee
Stock Purchase Plan (incorporated herein by reference from
Exhibit 4-15 to the Company's Registration Statement on Form
S-8, dated January 22, 1996).
10-13 Agreement between the Company and ConAgra, Inc., for sale
of Dried Distiller's Grains and Wet Distiller's Grains
(incorporated herein by reference from Exhibit 10-14 to
the Company's annual filing on Form 10-K dated June 30,
1996).
10-14 Stanley E. Larson Retirement and Consulting Agreement,
dated April 11, 1997 attached hereto.
10-15 Agreement between Centennial Trading, LLC, Michael Rowan
and the Company, dated January 7, 1997, for the
exclusive supply of grain to the Company, attached
hereto.
11-1 Statement on Computation of Per Share Earnings
(incorporated herein by reference from the Company's 1997
Annual Report to Stockholders for the fiscal year ended June
30, 1997 which is anticipated to be filed with the
Securities and Exchange Commission within 120 days after the
end of the Company's fiscal year ended June 30, 1997).
24-1 Consent of Allen, Gibbs, and Houlik, L.C., independent
certified public accountants.
27-1 Financial Data Schedule.
<PAGE>
Exhibt 10-14
AGREEMENT
This Agreement is made this 11th day of April, 1997 by and
between High Plains Corporation (High Plains or HPC), a Kansas
corporation, and Stanley E. Larson (Larson), an individual
resident of Tucson, Arizona.
Whereas, Larson is currently the President and Chairman of the
Board of High Plains pursuant to that certain Employment Agreement
dated April 1, 1995; and,
Whereas, Larson and the Board of Directors of High Plains have
reached an agreement pursuant to which Larson will resign as an
officer and director, and agree to the termination of his
Employment Contract, in return for the consideration set forth
herein.
Therefore, in consideration of the mutual covenants and
conditions set forth herein, the parties agree as follows:
1. By his signature below, Larson hereby resigns, effective
immediately, his positions as an officer, board member, and
Chairman of the Board, of High Plains. Larson further agrees that
his Employment Contract with High Plains is terminated,
effectively immediately; that neither he nor High Plains shall be
under any further obligation to each other pursuant to the terms
of said Employment Contract except for the provisions of
paragraphs 9, 10, 11, 12, and 13, which specifically survive the
termination of that contract, and which the parties agree shall be
effective and in force until July 1, 2000; and that each party
hereby waives any and all claims against the other arising out of
the Employment Contract, the employment relationship, or the
termination thereof.
2. Larson agrees to terminate the Vehicle Lease Agreement dated
May 29, 1996 with High Plains in accordance with its terms, by
paying to High Plains the sum of $24,048, representing the
unearned portion of the lease prepayment made on the vehicle by
High Plains. Upon receipt of this amount, High Plains will
release to Larson any right title or interest it may have in the
vehicle covered by said lease.
3. Larson agrees to immediately surrender for cancellation
388,761 options to purchase common stock of High Plains previously
granted to him by the company. He may retain the 10,000 options
that were granted on May 8, 1996 with an exercise price of $3.50,
under the terms of the High Plains Corporation Stock Option Plan,
and the Stock Option Agreement, which require these options to be
exercised within 90 days of termination of employment, or they
will expire. The parties acknowledge that the options previously
issued to Larson pursuant to the High Plains Corporation Employee
Stock Purchase Plan (ESPP) were exercised by Larson on April 10,
1997.
<PAGE>
4. In consideration of the termination of Larson's employment
contract, High Plains agrees to pay to Larson an amount equal to
the payments High Plains would have made for bonus payments
(pursuant to paragraph 5(b) of the Employment Contract) over the
remaining term of the contract (expiring July 1, 2000), even
though Larson will no longer be an employee of High Plains.
Larson specifically waives any additional benefits which would
have been due and payable under the Employment Contract, except as
otherwise specifically set forth below. Payments shall be made
quarterly for these bonus amounts, in accordance with the payment
terms which were set forth in the contract. Additionaly, High
Plains agrees to grant to Larson the following options to purchase
High Plains' common stock:
14,000 non-qualified options to be granted on August 1, 1997,
under the terms of the company's 1992 Stock Option Plan, at
an exercise price equal to one-half of the lowest closing
price achieved by the company's stock between May 1, 1997 and
August 1, 1997 (in replacement of the options Larson would
have received under the ESPP if he were still an employee as
of August 1, 1997). These options will terminate if not
exercised on or before April 10, 2001, or in the event of
Larson's death prior to that time, within 12 months after the
date of his death, but not later than April 10, 2001.
5. The parties further agree to enter into a consulting
arrangement whereby Larson will consult for High Plains on an as
needed basis at the request of High Plains and in the areas of his
expertise. The parties currently contemplate these services to
include areas such as legislative initiatives, public relations,
and assistance in reviewing and evaluating merger and acquisition
opportunities. Larson also agrees to cooperate with High Plains
in the prosecution or defense of pending or future litigation
involving the company. This consulting agreement shall continue
until July 1, 2000, and Larson agrees to use his best efforts to
make himself available to perform these services as reasonably
requested by High Plains. However, both parties agree that Larson
is no longer an employee of High Plains, and that his status as a
consultant will be on individual matters specifically requested by
the High Plains Corporation Board of Directors. Larson shall have
no authority to contract on behalf of High Plains, or to commit
High Plains to any obligation or agreement, but only to advise the
Board regarding requested matters. Any expenses incurred by
Larson in this consulting capacity on requested matters shall be
subject to reimbursement by High Plains.
6. In consideration of this consulting agreement High Plains
agrees to pay to Larson payments equal to those that High Plains
would have made as salary pursuant to paragraph 5(a) of the
Employment Contract over the remaining term of the contract
(expiring July 1, 2000). These payments shall be made at least
monthly, however, the parties agree that these salary amounts may
<PAGE>
be prepaid at any time if High Plains determines in its discretion
that it can do so without impairing its cash flow requirements.
In the event of either the termination of this consulting
agreement or the death of Larson prior to full payment of the
amounts due under this paragraph 6, the amounts payable in
replacement of the salary portion of the Employment Contract shall
continue to be paid to Larson or his estate until paid in full,
but all other payments or benefits provided for in this paragraph
6 shall terminate immediately. Any options already granted shall
be retained by Larson, but no additional options shall be granted
after Larson's death or termination of the Consulting Agreement.
The consulting agreement may be terminated at any time by Larson
upon written notice to High Plains, and shall be considered
terminated automatically upon Larson's death. As additional
consideration for the services to be provided by Larson pursuant
to this consulting agreement, High Plains agrees to grant to
Larson the following options to purchase High Plains common stock:
a. 50,000 non-qualified options to be granted on April 11,
1997, under the terms of the company's 1992 Stock
Option Plan, at an exercise price equal to the closing
price of the stock on April 11, 1997.
b. 50,000 non-qualified options to be granted on April 11,
1998, under the terms of the company's 1992 Stock
Option Plan, at an exercise price equal to the closing
price of the stock on April 13, 1998.
c. 50,000 non-qualified options to be granted on April 11,
1999, under the terms of the company's 1992 Stock
Option Plan, at an exercise price equal to the closing
price of the stock on April 12, 1999.
All of these options shall expire if not exercised on or before
the earlier of either April 10, 2001, or 12 months following the
termination of the consulting agreement as described above.
In witness whereof, the parties have executed this agreement
as of the day and year first written above.
HIGH PLAINS CORPORATION LARSON
By_s/H.T. Ritchie____________ s/Stanley E. Larson______
H.T. Ritchie Stanley E. Larson
Chairman,
Compensation Committee
Exhibit 10-15
EXCLUSIVE GRAIN SUPPLY AGREEMENT
AGREEMENT made this 1st day of January, 1997, by and between
Mike Rowan, an individual resident of 1620 Magnolia, Liberty,
Missouri, 64068 "Rowan" and High Plains Corporation, a Kansas corporation
with its principal offices at 200 W. Douglas, Suite 820, Wichita,
Kansas 67202, "High Plains".
WHEREAS, High Plains is a purchaser of grain for use at its
Colwich, Kansas and York, Nebraska plants, and Rowan has expertise
in the grain and feed business; and
WHEREAS, both Rowan and High Plains desire to enter into an
exclusive supply agreement for the procurement of grain by Rowan
for High Plains for use at High Plains' Colwich, Kansas and York,
Nebraska, plants.
NOW, THEREFORE, in consideration of the mutual agreements and
other good and valuable consideration hereinafter set forth, the
parties agree as follows:
1. SALE OF PRODUCTS. This Agreement applies to all grain
purchased by High Plains for use at its Colwich, Kansas and York,
Nebraska, plants (the "Grain"). High Plains agrees to buy all of
its requirements of Grain through Rowan, who will contract for
High Plains as an independent contractor, during the term of this
Agreement. Rowan agrees to sell or acquire for the benefit of
High Plains, subject to availability, such Grain to High Plains
for the term of this Agreement. Rowan and High Plains agree that
such purchases will be at terms, conditions and price as agreed
upon. Title and risk of loss for grain shall pass to High Plains
upon unloading of the grain at High Plains plant. Rowan shall
provide grain in quantities as necessary to permit High Plains to
maintain its usual production schedule.
2. FORECAST INFORMATION. Rowan agrees to provide High Plains
with regular feedgrain analyses and other forecast information
available from third-parties to assist High Plains in its purchase
decisions. However, regardless of any price or purchase
recommendations or forecasts provided by Rowan, High Plains
remains solely responsible for its purchasing decisions and any
gains or losses resulting from those decision. Rowan PROVIDES NO
WARRANTY AS TO ANY PRICING PROJECTIONS, FORECASTS OR PURCHASE
RECOMMENDATIONS. Rowan further agrees to provide the following
additional services to High Plains during the term of this
agreement at his own cost and expense: a) continually monitor,
arrange and adjust scheduling of grain shipments to meet High
Plains needs; b) responsibility for truck and rail transportation
needs, including price management techniques such as back-hauls
and arbitrage arrangements; c) sourcing of alliances with third
parties for storage and execution backstops as needed; d)
accounting and auditing for transportation, grain taxes, cash flow
management, etc.; e) assist High Plains in lobbying efforts in
<PAGE>
grain and feed areas; f) assist in implementation and monitoring
of appropriate risk management procedures relating to High Plains
grain needs; and g) communicate and cooperate with designated High
Plains personnel in determining grain needs, sourcing, scheduling
and pricing grain, and coordinating the other services Rowan
agrees to perform for High Plains pursuant to this agreement.
3. PRICE. Rowan agrees to supply grain to High Plains at a
fixed price, F.O.B. Colwich, Kansas or York, Nebraska. Rowan will
absorb the costs of all freight, transportation, inventory carry
charges, and all state or other grain taxes prior to delivery of
grain. Rowan will use his best efforts to obtain the lowest
possible total grain cost for High Plains under prevailing market
conditions. High Plains shall pay Rowan the amount actually paid
by Rowan to his supplier for the grain, plus actual freight
incurred (crediting reductions for backhaul or arbitrage
arrangements), plus grain taxes paid , plus a fee in the amount of
$.0175 per bushel. The parties may also agree to enter into
certain hedging, or other futures agreements from time to time, in
which event all costs of such hedging, including margin calls and
commissions, will be the responsibility of High Plains. Rowan
agrees to back up all contracts for delivery of grain to High
Plains with either futures or trades on the Chicago Board of
Trade, or with individual supply contracts from farmers, local
elevators, or other legitimate sources, and shall provide evidence
of this backup to High Plains upon request. All such futures or
contracts shall be executed on behalf of, and transacted in the
name of High Plains by Rowan, upon approval of High Plains. Rowan
shall keep complete and accurate records of all transactions made
for the benefit of High Plains, and High Plains shall have the
right to audit and copy all records in any way relating to grain
or futures contracts purchased, or to expenses incurred in
connection with said transactions, upon reasonable notice to
Rowan, and at the sole expense of High Plains. The parties agree
that after the first 90 days of the term of this agreement has
passed, they will cooperate in attempting to establish a mutually
agreeable method for measuring Rowan's effectiveness as a grain
purchasing agent, with the idea that if Rowan's performance under
this contract can be effectively measured, and his efforts have
resulted in significant savings to High Plains, then Rowan's fee
arrangement may be restructured to include a performance bonus
provision agreeable to both parties.
4. PAYMENT. Payment for purchases under this Agreement are
due daily, and shall be made by drafting an account of High
Plains' choice on the first business day following delivery to
High Plains. The weight of Raw Grains delivered by Rowan to High
Plains shall be established by weight certificates. High Plains
shall obtain truck weights on the scales at the High Plains
Plants, which shall be maintained by High Plains as required by
applicable laws, rules and regulations, and rail weights will be
obtained on any certified railroad scales. Whenever High Plains
<PAGE>
truck scales are unavailable or inoperable, any certified scales
may be used, at High Plains expense, until High Plains scales are
restored. The inbound weight certificates shall be determinative
of the quantity of Raw Grains for which High Plains is obligated
to pay pursuant to Section 3 hereof.
5. TERM. This Agreement shall commence on January 31, 1997
and continue for one year. After the first year, the Agreement
shall automatically renew for one-year terms. However, either
party may terminate this Agreement at any time upon giving the
other party thirty (30) days notice of termination in writing.
This Agreement may be terminated immediately by either party if
(i) the other party's financial responsibility becomes impaired,
(ii) the other party makes an assignment or arrangement for
benefit of creditors or (iii) files a petition in bankruptcy or
has such petition filed against it.
Upon expiration, termination, or cancellation of this Agreement,
neither party shall have any rights or obligations or liability to
the other party with respect to this Agreement except for (a) the
obligation to make full payment of any outstanding monetary
obligations owed to the other party which monetary obligation was
incurred prior to the date of such expiration, termination or
cancellation, and (b) obligations under any Grain or futures
contract which existed prior to such expiration, termination or
cancellation of this Agreement.
6. EMPLOYEES. The parties agree that Rowan is not an employee
of High Plains, and that his relationship is that of an
Independent contractor only. Each party shall be solely
responsible for the acts and inactions of its own employees acting
within the course and scope of their employment by such party and
each party shall be solely responsible for the salary, wages and
payroll taxes for its employees and shall maintain Workers'
Compensation Insurance on its employees as required by applicable
state law. The parties shall have no joint employees as a result
of this Agreement and neither party shall incur any responsibility
or liability whatsoever with respect to, or for the acts or
inactions of, the employees of the other party as a result of this
Agreement.
7. INDEMNIFICATION. Rowan shall indemnify and hold High
Plains, and its affiliates, subsidiaries, parents, directors,
officers, employees and agents harmless from and against any and
all claims, losses, awards, judgements, settlements, fines,
penalties, liabilities, damages, costs or expenses (including
attorneys' fees) alleged or incurred on account of any injury or
death of persons or damages to property or any other claim to the
extent caused by or arising out of the negligent acts or omissions
of Rowan, its officers, agents or employees, or any breach by
Rowan, its officers, agents or employees, of any of the terms of
this Agreement, or any representations by Rowan which are not
<PAGE>
authorized pursuant to the Agreement or pursuant to specific
instructions given to Rowan by High Plains.
High Plains shall indemnify and hold Rowan, and its affiliates,
subsidiaries, parents, directors, officers, employees and agents
harmless from and against any and all claims, losses, awards,
judgements, settlements, fines, penalties, liabilities, damages,
costs or expenses (including attorneys' fees) alleged or incurred
on account of any injury or death of persons or damages to
property or any other claim to the extent caused by or arising out
of the negligent acts or omissions of High Plains, its officers,
agents or employees, or any breach by High Plains, its officers
agents, or employees, of any of the terms of this Agreement, or
any representations by High Plains which are not authorized
pursuant to this Agreement or pursuant to specific instructions
given to High Plains by Rowan.
8. FORCE MAJEURE. Neither party shall be liable for failure
to perform or for delay in performing this Agreement, other than
for an existing debt, where such failure or delay is occasioned by
(a) fire, explosion, breakdown of plant, failure of machinery,
strike, lock-out, labor dispute, casualty or accident, or lack or
failure in whole or in part of transportation facilities, (b)
storm, flood or drought, (c) lack or failure in whole or in part
of the sources of supply (other than Grain), labor, or power or
other utilities, (d) acts of God or the public enemy, war, riots,
police action, or civil commotion, (e) any law, regulation,
ordinance, demand, judgment, injunction, arbitral award, or other
requirement or regulation of any government or government agency
or instrumentality or (f) any other act whatsoever, whether
similar or dissimilar to those above-enumerated, beyond the
reasonable control of the party suffering such event of force
majeure. The party asserting that an event of force majeure has
occurred shall send the other party notice thereof by cable,
telecopy or telex no later than three (3) days after the beginning
of such claimed event setting forth a description of the event of
force majeure, an estimate of its effect upon the party's ability
to perform its obligations under this Agreement and the duration
thereof. The notice shall be supplemented by such other
information or documentation as the party receiving the notice may
reasonably request. As soon as possible after the cessation of
any event of force majeure, the party which asserted such event
shall give the other party written notice os such cessation.
Whenever possible, each party shall give the other party notice of
any threatened or impending event of force majeure.
9. ALTERNATE DISPUTE RESOLUTION. This contract is subject to
the National Grain and Feed Association Grain Trade Rules and
Arbitration Rules. Any controversy arising out of, or relating
to, the Agreement between the parties or any modification or
extension thereof, including any claim for damages or rescission,
or both, shall be settled by arbitration in accordance with those
<PAGE>
rules unless the parties should agree otherwise in writing. The
parties further agree that arbitration proceedings must be
instituted within one year after the occurrence of the claimed
breach, and that the failure to institute arbitration proceedings
within such time period shall constitute an absolute bar to the
institution of any proceedings and a waiver of all claims. All
fees for such arbitration will be divided equally between the
parties except that each party shall pay its own attorney's fees
and the costs associated with producing documents and other
information.
10. NOTICES. All notices, consents and other communications
under this Agreement shall be in writing and shall be deemed to
have been duly given when delivered in person or deposited in the
United States mail (registered or certified), postage prepaid or
deposited with a reputable overnight delivery service, with
delivery charges prepaid, in each case addressed or transmitted to
the appropriate address as follows (or as otherwise designated by
a party as to itself by notice to the other party given in
accordance with this section):
If to Rowan: Mr. Mike Rowan
1620 Magnolia
Liberty, Missouri 64068
If to High Plains: High Plains Corporation
200 W. Douglas
Suite 820
Wichita, Kansas 67202
Attn: Raymond G. Friend
11. INSURANCE. During the term of this Agreement, Rowan shall,
at his sole cost and expense, maintain in force Statutory Worker's
Compensation and Employer's Liability Insurance in compliance with
the laws of the states where the work is being performed;
comprehensive General Liability Insurance, which shall include
property damage and personal liability insurance under which Rowan
and High Plains shall be named as coinsureds; and coverage for
contractual liability under this agreement. Such insurance policy
or policies shall be maintained in a minimum amount of One Million
Dollars per occurrence, and Rowan shall deliver to High Plains a
copy of each insurance policy, showing High Plains as a named
insured thereon. The insurance requirements set forth herein are
minimum coverage requirements and are not to be construed in any
was as a limitation on liability under this agreement.
12. WARRANTIES.
Rowan understands that High Plains intends to utilize the Raw
Grains purchased from Rowan as primary base stock for ethanol
<PAGE>
production and for production of a dried distillers grain cattle
feed, and that said Raw Grains are subject to minimum quality
standards for such use. Rowan agrees and warrants that all grain
contracts and deliveries negotiated by Rowan for High Plains shall
contain provisions requiring, and Rowan shall use his best efforts
to insure that:
a. Raw Grains delivered to High Plains shall not be adulterated
or misbranded within the meaning of the Federal Food, Drug and
Cosmetic Act and that said Raw Grains may lawfully be introduced
into interstate commerce pursuant to the provisions of the Act.
Raw Grains shall fully comply with any applicable state laws
governing quality, naming and labeling of Raw Grains.
b. Raw Grains delivered to High Plains shall be free and clear
of liens and encumbrances.
c. Rowan agrees and warrants that Raw Grains delivered to the
Plants shall be acceptable in the feed trade under current
industry standards and shall be of merchantable quality.
c. Raw Grains that are deemed to be of non-merchantable quality
shall not be delivered to either plant unless both parties agree
in writing in advance of delivery that the quality of the grain
will not effect the quality of the cattle feed or other by-
products of High Plains' plants.
13. ASSIGNMENT. This Agreement shall not be assigned by either
party without the written consent of the other party, and any
attempted assignment without such consent shall be ineffective.
14. ENTIRE AGREEMENT. This Agreement contains the entire
agreement between the parties and supersedes all previous
agreements either oral or written, between the parties hereto, and
no modifications hereof shall be valid unless made in writing and
signed by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have set their hands and
seals the day and year above written.
THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY
BE ENFORCED BY THE PARTIES.
HIGH PLAINS CORPORATION Mike Rowan
By:s/Raymond G. Friend s/ Michael L. Rowan
Title: Executive Vice President
<PAGE>
ADDENDUM TO EXCLUSIVE
GRAIN SUPPLY AGREEMENT
This Addendum to Exclusive Grain Supply Agreement is made this
7th day of January, 1997, by and between Mike Rowan, an individual
resident of 1620 Magnolia, Liberty, Missouri, 64068 "Rowan"; High
Plains Corporation, a Kansas corporation with its principal
offices at 200 W. Douglas, Suite 820, Wichita, Kansas 67202, "High
Plains"; and Centennial Trading, LLC, a Limited Liability Company
with its principal offices at Kansas City Board of Trade, 4800
Main Street, Suite 502, Kansas City, MO 64112, "Centennial".
WHEREAS, High Plains and Rowan entered into an Exclusive Grain
Supply Agreement (the "Agreement") dated and effective January 1,
1997; and,
WHEREAS, all parties hereto wish to amend said Agreement so that
Centennial assumes all of the rights and responsibilities of Rowan
thereunder.
NOW, THEREFORE, in consideration of the mutual agreements of the
parties and other good and valuable consideration hereinafter set
forth, the parties agree as follows:
1. Rowan hereby assigns, and Centennial accepts and assumes,
all of the rights and responsibilities of Rowan under the
Agreement referenced above, effective immediately. Rowan shall
continue to be personally responsible for the performance by
Centennial of its obligations under the agreement.
2. By its signature below, High Plains consents to the above
assignment to Centennial on the terms set forth herein.
IN WITNESS WHEREOF, the parties hereto have set their hands and
seals effective as of the day and year above written.
HIGH PLAINS CORPORATION Mike Rowan
By:s/ Christopher G. Standlee s/ Michael L. Rowan
Title: Vice President
CENTENNIAL TRADING, LLC
By:s/ Michael L. Rowan
Michael L. Rowan, Member
By:s/ Bryce Wells
Bryce Wells, Member
Exhibit 24-1
REPORT AND CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Stockholders and Board of Directors
High Plains Corporation
We hereby consent to the incorporation by reference in this annual report on
Form 10-K of High Plains Corporation for the year ended June 30, 1997 of our
report dated August 7, 1997 which appears in the annual report to
stockholders for the year ended June 30, 1997.
ALLEN, GIBBS & HOULIK, L.C.
Wichita, Kansas
September 24, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-END> JUN-30-1997
<CASH> 2,389,758
<SECURITIES> 0
<RECEIVABLES> 5,756,131
<ALLOWANCES> 75,000
<INVENTORY> 4,246,783
<CURRENT-ASSETS> 12,847,350
<PP&E> 86,022,531
<DEPRECIATION> 20,444,381
<TOTAL-ASSETS> 79,074,532
<CURRENT-LIABILITIES> 12,777,233
<BONDS> 10,200,014
0
0
<COMMON> 1,639,662
<OTHER-SE> 54,016,514
<TOTAL-LIABILITY-AND-EQUITY> 79,074,532
<SALES> 57,941,785
<TOTAL-REVENUES> 63,121,510
<CGS> 59,414,514
<TOTAL-COSTS> 58,804,445
<OTHER-EXPENSES> 1,653,681
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,354,983
<INCOME-PRETAX> 1,714,395
<INCOME-TAX> 18,895
<INCOME-CONTINUING> 1,733,290
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,733,290
<EPS-PRIMARY> .11
<EPS-DILUTED> .11
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