OAKRIDGE HOLDINGS INC, 10KSB, 1999-09-28

OAKRIDGE HOLDINGS INC
10KSB, 1999-09-28
LAND SUBDIVIDERS & DEVELOPERS (NO CEMETERIES)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

(Mark One) Form 10-KSB

{X} ANNUAL REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the fiscal year ended June 30, 1999

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

For the transition period from ____ to ____

Commission file number 0-1937

OAKRIDGE HOLDINGS, INC.
(Name of small business issuer as specified in its charter)

MINNESOTA 41-0843268
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)

4810 120TH STREET WEST, APPLE VALLEY, MINNESOTA 55124
(Address of principal executive offices)

(612) 686-5495
(Issuer's telephone number, including area code)

Securities registered pursuant to Section 12 (b) of the Exchange
Act: None

Securities registered pursuant to Section 12 (g) of the Exchange
Act:

COMMON STOCK, PAR VALUE $.10 PER SHARE
(Title of Class)

Check whether the issuer (1) has filed all reports required to
be filed by Section 13 or 15 (d) of the Exchange Act during the
past 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 { }

Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B contained in this form, and no
disclosure will 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-KSB or any
amendment to the Form 10-KSB. {X}

The issuer's revenues for its fiscal year ended June 30, 1999
were $12,409,032.

The aggregate market value of the voting stock held by
non-affiliates on September 9, 1999, was approximately
$7,981,017, based on the average of the bid and asked price of
such stock.

The number of shares outstanding of Registrant's only class of
common equity on September 9, 1999, were 1,388,003.

Documents incorporated by reference: None.

Transitional Small Business Disclosure Formats. Yes{ }No{X}

PART I

CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: This form 10-KSB contains certain
forward-looking statements. Forward-looking statements do not
relate strictly to historical or current facts, but rather give
our current expectations or forecasts of future events.
Forward-looking statements may be identified by use of words such
as "plans," "expects," "may," "will," "anticipates," "believes"
and other words of similar meaning. Forward-looking statements
may address, among other things, the Company's strategy for
growth, product development, regulatory changes, the outcome of
contingencies (such as legal proceedings), market position,
expenditures, and financial results. Forward-looking statements
are based on current expectations of future events. Forward-
looking statements involve risks and uncertainties, and actual
results could differ materially from those discussed. Among the
factors that could cause actual results to differ materially from
those projected in any forward-looking statement are as follows:
the effect of business and economic conditions; the impact of
competitive products and continued pressure on prices realized by
the Company for its products; constraints on supplies of raw
materials used in manufacturing certain of the Company's products
or services provided; capacity constraints limiting the
production of certain products; difficulties or delays in the
development, production, testing and marketing of products;
market acceptance issues, including the failure of products to
generate anticipated sales levels; difficulties in manufacturing
process and in realizing related cost savings and other benefits;
the effects of changes in trade, monetary and fiscal policies,
laws and regulations; foreign exchange rates and fluctuations in
those rates; the costs and effects of legal and administrative
proceedings, including environmental proceedings; difficulties in
"Year 2000" problems; and the risk factors reported from time to
time in the Company's SEC reports. The Company undertakes no
obligation to update any forward-looking statement as a result
of future events or developments.

GENERAL POINTS

In this report:

Oakridge Holdings, Inc. and its subsidiaries, collectively, are
called the "Company" or "Oakridge," unless otherwise indicated by
the context. The Company has two business segments - cemeteries
and aviation ground support equipment.

The term "operating earnings" represents revenues less all
operating expenses. Operating expenses of a business segment do
not include corporate interest expense, corporate income or
expense, or taxes on income.

All references to years are to fiscal years ended June 30 unless
otherwise stated.

ITEM 1. DESCRIPTION OF BUSINESS

(a) BUSINESS DEVELOPMENT

Oakridge Holdings, Inc. ("OHI"), through its wholly owned
subsidiaries described in this Form 10-KSB (with OHI,
collectively referred to herein as the "Company"), is engaged in
the following business segments:

- -Cemeteries used for the interment of human remains
- -Manufacturing and Marketing Aviation Ground Support Equipment

The Company began operations on March 6, 1961, with two
cemeteries in Cook County, Illinois, emphasizing service and
careful attention to customers' preferences and needs. Over the
next 30 years, the Company became involved in more cemeteries,
funeral homes, marketing of monuments, various partnerships in
real estate transactions and construction of single and multiple
family housing projects.

After sustaining substantial losses during the late 1980's, in
fiscal year 1993 a special shareholders meeting was called and a
new board of directors was elected. The new board, led by the
present chairman, began to implement a turnaround strategy.
Among other things, the strategy included a decision to refocus
the Company on its core business segment, the cemeteries. The
Company also took other actions, including the elimination of all
corporate staff and offices of OHI, to reduce overhead expenses.

On June 29, 1998, the Company acquired substantially all of the
assets of Stinar Corporation, a Minnesota corporation,
manufacturer and seller of aviation ground support equipment used
by airports, airlines and military installations.

(b) BUSINESS OF THE COMPANY

CEMETERIES BUSINESS SEGMENT

Through two wholly owned subsidiaries,
Oakridge Cemetery (Hillside), Inc. and Glen Oak Cemetery, Inc.,
the Company operates two adjacent cemeteries near Hillside,
Illinois. The cemetery operations are discussed on a consolidated
basis and the Company makes no functional distinction between the
two cemeteries, except where noted.

Together the cemeteries comprise 176.7 total acres of real
estate, of which 12.8 acres are used for interior roads and other
improvements, and 163.9 acres with 137,000 burial plots, of which
36,537 were in inventory, with 975 niches and 3,190 crypts, of
which 148 niches and 348 crypts were in inventory. The Company
estimates that it has an inventory of cemetery and mausoleum
spaces representing between a 25 to 33 year supply, based on the
maintenance of current sales and annual usage levels. This
inventory is considered adequate for the foreseeable future, and
the Company is presently developing a plan of adding more niches
and crypts in the future. The Company also holds deeds to 188
unsold crypts located in Forest Home Cemetery in Forest Park,
Illinois. Cook and DuPage Counties in Illinois serve as the
principal market for the Company's services. In addition to
providing internment services, burial plots and crypts, the
Company sells cremation services.

AVIATION GROUND SUPPORT EQUIPMENT SEGMENT

On June 29, 1998, the Company (through Stinar HG, Inc., a
Minnesota corporation and wholly-owned subsidiary of the Company
("Stinar")) purchased substantially all of the assets (including
the right to use the Stinar name)(the "Assets") of Stinar
Corporation, a Minnesota corporation ("Seller"). Until the sale
of the assets to Stinar, Seller had been engaged in the
manufacture and sale of aviation ground support equipment for use
by airports, airlines and military bases. The Company now
operates this segment under the name "Stinar."

Principal products of Stinar include the following: truck-mounted
stairways and push stairs for loading aircraft; lavatory trucks
and carts, water trucks and carts, and catering trucks for
servicing aircraft; cabin cleaning trucks, maintenance hi-lifts,
and turbo oilers for maintaining aircraft; and other custom-built
aviation ground support equipment used by airports, airlines and
the military. Stinar also provides limited service and repairs on
equipment it sells and equipment purchased from other vendors.

The Company acquired the Assets pursuant to an Asset Purchase
Agreement between Stinar, the Seller and the shareholders of the
Seller. The aggregate purchase price for the Assets consisted of:
(i) $2,000,000 cash paid at closing; (ii) a promissory note
issued by Stinar in the original principal amount of $200,000,
payable June 30, 1999 with interest at 8.25% per annum,
guaranteed by OHI; (iii) a convertible subordinated debenture of
OHI in the original principal amount of $700,000. OHI has the
right to pay the principal before the debenture is due or the
debenture is convertible into shares of OHI's common stock at a
conversion price equal to seventy-five percent (75%) of the mean
between the average closing "bid" and "ask" price of OHI's common
stock on each of the last five (5) full trading days immediately
prior to the date the debenture is converted, with interest
payable at 9% per annum on December 31 of each year it is
outstanding and principal payable in annual installments of
$200,000 commencing June 30, 2001 and on June 30, 2002 and 2003,
with a final payment of principal on June 30, 2004, guaranteed by
OHI; and (iv) aggregate payments under two contracts for deed
pursuant to which Stinar will pay the Seller and two of its
shareholders principal of $1,400,000 over seven years from the
closing date, with equal installments of principal and interest
(at the rate of 8.25%) payable monthly. In addition to the
foregoing payments, Stinar assumed debt of the Seller in the
amount of approximately $2,830,000. The source of the $2,000,000
cash paid by Stinar at the closing was income from the Company's
operations, a $3,000,000 credit facility extended to Stinar by
Riverside Bank of Minneapolis, and the sale of convertible
subordinated debentures by the Company.

In connection with the Asset acquisition, Stinar entered into
employment agreements with Randy and Gary Stinar, shareholders
and former employees of the Seller, pursuant to which each will
serve as an employee of Stinar until June 30, 2000. The terms
and conditions of their employment are substantially similar to
the terms and conditions of their employment with Seller. Randy
Stinar terminated his employment with Stinar during 1998.

Stinar sells its products to airports, airlines, and government
and military customers in the United States, where domestic sales
comprise approximately 45%, government and military customer's
35% and international 20% of its annual revenues.

FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS

The following table summarizes the assets, revenues
and operating results attributable to the Company's two industry
segments for the date and periods indicated. Other financial
information about the Company's business segments appears in Item
7, Management's Discussion and Analysis of Financial Condition
and Results of Operations, and in Item 8, Financial Statements
and Operations and Supplementary Data.

For the fiscal years ended June 30, 1999 1998

Revenues:
(1) Aviation $9,618,837 $ 0
(2) Cemetery 2,790,195 2,767,214

Operating profit or loss:
(1) Aviation $ 140,827 $ 0
(2) Cemetery 877,801 798,035

Identifiable assets:
(1) Aviation $5,408,274 $7,072,180
(2) Cemetery 3,072,662 2,176,457

CERTAIN IMPORTANT FACTORS - GOVERNMENT

The Company holds all governmental licenses necessary to carry on
its business and all such licenses are current. Neither of the
Company's two business segments is heavily regulated, although
the cemeteries are required to comply with state laws and
regulations applicable to all cemeteries and funeral homes
operating in Illinois. The costs and effects of compliance with
these regulations do not have a material impact on the financial
results of the Company.

Under Illinois law, the Company is required to place a portion of
all sales proceeds of cemetery lots, niches and crypts in a trust
fund for perpetual care of the cemeteries. Pursuant to these
laws, the Company deposits 15% of the revenues from the sale of
grave spaces and 10% of revenues from the sale of crypt spaces
and niches into a perpetual care fund. Earnings from these funds
are recognized in current cemetery revenues and are intended to
defray cemetery maintenance costs. The Company's perpetual care
funds balance as of June 30, 1999 was approximately $4,176,322.

The Company has a "pre-need" trust account representing revenues
received by the Company for the purchase of vaults and interment
services prior to the death of the decedent. The market value of
the pre-need trust as of June 30, 1999 was approximately
$718,385. The trust is administered by Access Financial Group,
Inc., through a master trust with the Illinois Cemetery
Association.

Stinar is required to comply with competitive bidding and other
requirements in cases where it sells to local, state and federal
governmental customers. The costs and effects of complying with
these requirements do not have a material impact on the financial
results of the Company.

COMPETITION

Success of competition in Oakridge's business segments include
price, service, location, quality and technological innovation.
Competition is strong in all markets served.

CEMETERY OPERATIONS. The Cemetery Operations compete with other
cemeteries in Cook and DuPage Counties in Illinois. Competitive
factors in the cemetery business are primarily predicated on
location, convenience, service, and heritage. Decisions made by
customers are only minimally influenced if at all, by pricing.
There are virtually no new entrants in the markets served by the
Company as the cost of acquiring sufficient undeveloped land and
establishing a market presence necessary to commence operations
is prohibitive.

STINAR CORPORATION. The aviation ground support equipment
business is extremely fragmented and diverse. The Company
estimates that there are approximately twenty-five companies
operating in the United States in the business of manufacturing
equipment similar to those manufactured by Stinar. The purchasers
of the types of equipment manufactured by Stinar tend to be
longstanding, repeat customers of the same manufactures, with
quality, reliability, pricing, warranties, after market service
and delivery being the key factors cited by customers in
selecting a aviation ground support equipment supplier.
Accordingly, while the market for Stinar equipment is
competitive, Stinar's reputation for quality and reliable
equipment and the industry's familiarity with Stinar puts it on
equal footing with most of its competitors.

Based on air transportation industry statistics obtained from GSE
Today, a trade publication, the Company estimates the annual
worldwide sales for the types of equipment manufactured by Stinar
is approximately $1,700,000,000, and no single competitor of
Stinar accounts for in excess of 10% of the share of the domestic
market. Competition internationally in the market for Stinar's
equipment is equally diffuse, and the international market is
served primarily by manufactures located in the United States and
Europe.

MARKETING

CEMETERY OPERATIONS. Sales are made to customers utilizing
the facilities primarily on an at-need basis, that is, on the
occurrence of a death in the family when the products and
services and interment space are sold to the relatives of the
deceased. The cemeteries do not actively market their products.
Rather the customers typically learn of the cemeteries from
satisfied customers who recommend the cemeteries based on
superior location and services rendered.

STINAR CORPORATION. The chief method of marketing Stinar's
equipment is through one-on-one customer contact made by sales
representatives employed by Stinar and manufacturer's
representatives under contract with Stinar. Stinar's customers
report that Stinar has a reputation in the commercial aviation
industry for manufacturing high quality, reliable equipment.
Stinar intends to capitalize on this reputation in the domestic
airline industry by making frequent sales calls on customers and
potential customers and by reducing the amount of time to needed
to complete customer orders. Stinar has also engaged
manufacturers' representatives to assist it in increasing sales
to overseas markets.

Neither of Oakridge's business segments generally extend
long-term credit to customers. However, the Company's aviation
ground support equipment segment may in the future periodically
facilitate leasing arrangements through unaffiliated companies
for the financing of aviation ground support equipment to airline
customers. In certain instances, the Company has provided, and
can be expected to continue to provide limited recourse to such
unaffiliated companies in the event of customer default, although
the Company believes that the potential liability from the
recourse is immaterial to the Company as a whole. The Company
believes this credit policy, as well as its working capital
requirements, do not materially differ from those of its
competitors.

Stinar's sales to customers outside the United States
represented approximately 20 percent of consolidated net sales in
1999. Products are manufactured and marketed through the
Company's sales department and sales representatives around the
world. For additional information, see discussions of individual
business segments included below; under Item 6, Management's
Discussion and Analysis of Financial Condition and Results of
Operations; and Item 7, Note 16 of the Notes to Consolidated
Financial Statements.

OTHER BUSINESS INFLUENCES

CEMETERY OPERATIONS. The Cemetery Operations do not experience
seasonal fluctuations, nor are they dependent upon any
identifiable group of customers, the loss of which would have a
material adverse effect on its business, and discussion of
backlog is not material to any understanding of Company's
business.

STINAR CORPORATION. While there is no reliable historical
information for Stinar to identify specific trends (except
for one year of operations), the Company believes that its
reliance on customers in the U.S. commercial aviation business
exposes Stinar to the cyclical nature of the airline industry.
In the event of a downturn or recession in the airline business,
world commercial air carriers would be more likely to curtail
purchases of capital equipment of the kind manufactured by
Stinar. In addition, government budget decisions and world
politics will affect sales to military purchasers both
domestically and internationally.

The diversity of Stinar's customer base and equipment lines
mitigates these risks, as does the growing importance of
marketing both domestically and internationally, providing Stinar
with an additional customer base not subject to economic
conditions or politics unless it is global.

The Company operates globally in the aviation ground support
equipment segment and is subject to certain risks, including
foreign currency fluctuations and government actions.

The Company does not believe that the present overall rate of
inflation will have a significant impact on the business segments
in which it operates. However, a worldwide general sales decline
in aviation ground support equipment on a global basis (caused by
recessions, airline employees strikes and increases in fuel
costs) has had a negative effect on operating results, and this
trend is expected to continue.

While future economic events cannot be predicted, the Company
believes its current operations and future expansion plans will
not significantly change its risk profile.

EMPLOYEES

As of June 30, 1999, the Company had 120 full time and 7 part
time or seasonal employees. Of these, the Company employed 96
full-time employees in the aviation segment and 24 full-time and
7 part-time or seasonal employees in the cemeteries segment.

The cemetery segment employees are represented by local #1, of
the Services Employees International Union, AFL-CIO, CLC, whose
contract expired February 29, 1999. If the Company is unable to
reach a negotiated settlement, a strike could occur which would
depress revenues and disrupt cemetery segment operations.

A union does not represent the Aviation segment employees and the
Company considers its labor relations to be excellent.

COMPLIANCE WITH ENVIRONMENTAL LAWS

CEMETERY OPERATIONS. In fiscal year 1995, the Company
commissioned an engineering study of the Cemetery Operations for
the purpose of determining the full extent of possible soil
contamination related to suspected leaking underground storage
tanks. As a result of this study, five underground fuel tanks
were removed and the adjoining soil was removed and disposed by
an independent contractor.

During 1999, the Company did not incur any expenses for
environmental remediating and a total of approximately $228,000
has been spend in prior years in remediating conditions at the
Cemetery Operations. In fiscal year 1997 the Company was
notified by the Illinois Environmental Protection Agency
("Illinois EPA") that the environmental work conducted at the
Cemetery Operations may not have been in full compliance with its
guidelines. The Company responded to the Illinois EPA with a work
plan that will require the expenditure of additional costs of
approximately $28,500 with the possibility of additional costs.
The Company is awaiting a response on the work plan from the
Illinois EPA. Additional costs beyond the $28,500 accrued for at
June 30, 1999 may be incurred; however, management cannot
reasonably estimate those costs. In addition, the Company may
not file for reimbursement from the Leaking Underground Storage
Tank Fund until the work plan has Illinois EPA approval.
Accordingly, the Company has made no provision for
reimbursements. The Company is not aware of any other
environmental issues affecting the Cemetery Operations.

STINAR CORPORATION. The Assets purchased by Stinar from the
Seller included a 43,271 square foot manufacturing facility
located on approximately 7.875 acres of land (the "Stinar
Facility") located in an industrial park in Eagan, Minnesota, a
suburb of St. Paul, Minnesota. Prior to the acquisition of the
Stinar Facility, Stinar and the Company obtained a Phase I
environmental assessment of the Stinar Facility. This Phase I
environmental assessment suggested the need for additional study
of the Stinar Facility. In addition, the Phase I assessment
suggested that certain structural improvements be made to the
Stinar Facility. Accordingly, two additional Phase II
environmental assessments were performed and revealed the
presence of certain contaminants in the soil around and under the
building located on the Stinar facility.

Subsequent to the completion of the Phase II environmental
assessments and completion of the structural improvements to the
building, the Company and Stinar requested and obtained a "no
association" letter from the Minnesota Pollution Control Agency
("MPCA") stating that, provided certain conditions set forth in
the no association letter are met, the Company and Stinar will
not be deemed responsible for contamination which occurred at the
Stinar Facility prior to the purchase of the Assets of Stinar.
The structural improvements recommended by the Company's
environmental consulting firm have been completed and the
contaminated soil has been removed and is awaiting transfer from
the property. Once the contaminated soil has been removed from
the property the Company believes the MPCA will issue the no
association letter.

The purchase agreement between the Seller, its shareholders and
Stinar requires the Seller and its shareholders to indemnify
Stinar for costs or expenses by Stinar related to environmental
conditions at the Stinar Facility, up to an amount believed by
the Company and Stinar to exceed the reasonably anticipated
potential liability associated with the Stinar Facility. In
addition, the Seller agreed to pay all costs associated with
obtaining the no association letter from the MPCA and the Seller
paid for the environmental consulting, remediating and structural
improvements discussed in the preceding paragraph. The Company
does not anticipate that the operations of Stinar and the
ownership of the Assets will result in any material liability to
the Company or Stinar under existing environmental laws, and
Stinar has not included a material sum in its budget for matters
relate to environmental compliance.

REAL ESTATE DEVELOPMENT

Mohave County, Arizona Water Front Lots

On December 27, 1994, The Company acquired from Mohave Shores
Development, Inc. the right to a 50 year sublease for the land
leased from the Fort Mojave Tribal Corporation for 10 residential
dwelling units adjacent to the Colorado River, and an option for
an additional 31 residential dwelling units. The Company paid
Mohave Shores Development, Inc. $250,000 for these rights and
options. In 1998, the Company determined that the likelihood or
realizing a return on this investment to be remote and
accordingly wrote of the investment in property rights to zero,
realizing a $250,000 loss on this investment.

ITEM 2: DESCRIPTION OF PROPERTY.

The Company's principal executive offices are located at
4810 120th Street West, Apple Valley, Minnesota and are leased
month to month. Total rental space is approximately 300 square
feet, condition is excellent, and cost is $100 per month. There
are no plans for renovation or improvement to the rental space.
The property is adequately insured.

The cemetery segment principal properties are located at
Roosevelt Road and Oakridge Avenue, Hillside, Illinois. The two
business segments comprise 176.7 acres of real estate, of which
12.8 acres are used for interior roads and other improvements,
and 163.9 acres for burial plots. This business segments has two
mausoleums, office building, and three maintenance buildings. The
Oakridge Cemetery (Hillside), Inc. mausoleum is in fair to
excellent shape The mausoleum for Glen Oak Cemetery is poor and
will require approximately $350,000 of repairs. All other
buildings are in fair shape and will require minimum repairs in
the future. The cemetery segments are subject to a mortgage in
the principal amount of $616,445. See Financial Statements,
beginning on page F-1 for payment details.

Stinar operates out of a single 43,271 square foot manufacturing
facility in Eagan, Minnesota located on 7.875 acres of land. The
land consists of two contiguous parcels of real estate. This
facility was purchased by Stinar in connection with the purchase
of Assets. The purchase of the Stinar facility was financed by
the Seller pursuant to contracts for deed payable in monthly
installments of $9,766 for seven years from the date of purchase,
with a balloon payment of principal of $1,207,000 due on June 29,
2005. The condition of the manufacturing facility and office
spaces are fair and will require improvements in the future at an
estimated cost of $250,000.

ITEM 3: LEGAL PROCEEDINGS

The Company is from time to time involved in litigation
incidental to the conduct of its businesses. There is no material
pending, or threatened legal, governmental, administrative or
other proceedings to which the Company is a party or of which any
of its property is the subject.

ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The shareholders approved the 1999 Stock Incentive Awards Plan
(the "1999 Plan") on February 22, 1999, at the annual meeting of
shareholders. The purpose of the 1999 Plan is to advance the
interests of the Company and its Shareholders by enabling the
Company to attract and retain persons of ability to perform
services for the Company. By providing an incentive to such
individuals through equity participation in the Company and by
rewarding such individuals who contribute to the achievement by
the Company of its economic objectives. The Company has reserved
a maximum of 175,000 shares of common stock for issuance under
the 1999 plan.

PART II

ITEM 5: MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS

(a) MARKET INFORMATION

Trading in the Company's common stock is in the over the counter
market, primarily through listings in the National Quotation
Bureau "pink sheets", although the market in the stock is still
not well established. The table below sets forth the range of bid
and asked prices for the two most recent fiscal years. Prices
used in the table were reported to the Company by National
Quotation Bureau, Inc. These quotations represent inter-dealer
prices, without retail markup or commission, and may not
necessarily represent actual transactions.

FISCAL YEAR

1999 1998
____________ ____________

First Quarter $1.59 - 3.50 $ .56 - 1.06

Second Quarter 1.75 - 4.50 .81 - 1.59

Third Quarter 2.63 - 4.00 1.25 - 4.00

Fourth Quarter 2.06 - 4.25 2.00 - 2.50

In July 1998, the Company sold 40,000 shares of unregistered
common stock to a director of the Company at a purchase price of
$2.00 per share resulting in net proceeds to the company. The
common stock was issued in reliance on an exemption provided in
Section 4(2) of the Securities Act of 1933.

The Company issued a total of 15,000 shares of unregistered stock
valued at $2.50 to $3.00 per share to one officer and two
employees for employment signing bonuses.

(b) HOLDERS

As of September 9, 1999, the number of holders of record of the
Company's common stock was 2109.

The Company has never paid dividends on it common stock and does
not anticipate paying dividends on its common stock in the
foreseeable future due to bank borrowings covenants.

ITEM 6: MANAGEMENT'S DISCUSSION AND ANALYSIS

FISCAL 1999

LIQUIDITY AND CAPITAL RESOURCES

The Company relies on cash flow from its two business segments to
meet operating needs, debt and funding capital requirements.
Cemetery operations have provided sufficient cash during the past
five years to support day-to-day operations, current debt
service, capital expenditures, and cash to assist in the
acquisition of the assets of Stinar. The Company expects that
cemetery operations and Stinar will provide sufficient cash
during the next five years to cover all debt payments and
operational needs.

Stinar has secured a $3,000,000 line of credit to fund operations
and capital expenditures. The line of credit expired June 30,
1999, and was extended until October 1, 1999. The Company
believes the present line of credit will be extended for another
year to October 1, 2000.

The cemetery has secured a line of credit for $225,000 to meet
any uncertainties that could materially affect liquidity. This
line of credit is secured by assets of the cemetery and matures
October 3, 1999. The Company believes the present line of credit
will be extended for another year to October 3, 2000.

There are no expected changes in the number of full time, part
time or seasonal employees by the Cemetery operations. However,
Stinar anticipates hiring an additional 15 full time employees
for production, and a chief financial officer in fiscal year
2000.

The cemetery operation and Stinar had a five-year plan for
capital expenditures starting in 1998 for $2,600,000. The Company
still believes this plan is appropriate and the Company is on
target at the end of fiscal year 1999.

The cemetery operations' capital expenditures will be
approximately $600,000 under the five-year plan. The funds will
be expended for road improvements, increased inventory of niches
and crypts in the mausoleum and outdoors, groundskeeping
equipment, and a new computer software and hardware system. The
Cemetery capital expenditures for fiscal year 1999 or the first
year of the five-year plan were $267,634. These funds were spent
on the following: $64,290 for software programs and hardware
(compliance with the year 2000), $26,826 for tools and implements
for the grounds, $129,251 on sewers and repaving of cemetery
roads, $43,056 to replace three ground vehicles being retired,
and $4,211 for new cemetery signs and flags.

Stinar's capital expenditures will be approximately $2,000,000
under the five-year plan. The funds will be expended for
improvements and repair of the manufacturing plant, office and
manufacturing equipment, upgrade administrative offices, computer
software and hardware, and vehicles. Stinar capital expenditures
for the first year of the five-year plan were $511,823. The funds
were spent on the following: $18,961 for a snow plow truck and
work on the semi-truck, $43,563 for computer stations, software
and network equipment, $48,860 for shop equipment with the
majority of the costs going for a steel saw, $23,763 for office
equipment and furniture, and $375,676 for building improvements.
The building improvements breakdown are: $67,900 for light
fixtures, $106,096 for make up air units and infrared heaters,
$78,932 for grinding and paint booths changes, and $122,748 for
electrical equipment and upgrading. Most funds expended for the
building brought the building up to code regulations and safety
standards with all federal and state agencies.

RESULTS OF OPERATIONS

CEMETERY OPERATIONS

In fiscal year 1999, cemetery revenue increased $22,981, or .8%,
over fiscal year 1998. The Company did experience a $105,000
increase, or 4.1%, in funeral service revenues due to an increase
in at-need cases handled of approximately 9% over fiscal year
1998. The increase was offset by a decrease of $61,000, or 2.4%,
in sales of monuments and memorials, primarily attributable to
one very large memorial sale in fiscal year 1998 and a $18,216
decrease in trust and interest income from 1998. The decrease is
due to a decrease in investment returns on taxable bond funds.

Operating expenses in fiscal year 1999 increased $65,615, or 5%,
but cost of goods sold in relation to sales increased 1.9% over
fiscal year 1998. The increase was due to higher labor cost,
increased medical and dental insurance benefits for the
employees, and ground repairs caused by vandalism and storms.

Gross profit decreased from 52.7% in fiscal year 1998 to 50.8% in
fiscal year 1999. The decrease was due to revenue mix and
increased costs of labor and related benefits, and repairs.

Selling expenses decreased $23,427, or 9.9%, for the fiscal year
1999, compared to fiscal year 1998, due to the elimination of the
sales manager position and decreased commissions attributable to
the large memorial sale discussed above.

General and Administrative expenses increased $35,778, or 8.5%,
for the fiscal year 1999 compared to fiscal year 1998. The
increase is due to legal fees associated with land condemnation
settlement.

STINAR OPERATIONS

In this segment of the Company's business, there is no reliable
historical financial information regarding operations to identify
specific trends.

Manufacturing sales in fiscal year 1999 were $9,618,837; the
sales makeup was 35% to United States Government entities, 20% to
international airlines, and 45% to commercial airlines.

Cost of sales in relation to sales was 88%, with raw materials
being 49%, labor and benefits being 27%, and the remaining 12%
being utilities, shop supplies, freight, insurance and
miscellaneous expenses.

Selling expenses in relation to sales was 5% or $459,834, with
sales salaries, sales representative's commissions and related
benefits 78%, advertising in trade magazines 11%, show expenses
4%, travel and miscellaneous 7%.

General and administrative expense in fiscal year 1999 was
$352,768 or 4% in relation to sales. Salaries and benefits 35%,
real estate taxes 16%, professional fees 15%, network-consulting
fees 3%, and various other expenses 31%.

Other expenses, which consist of interest expense, were $231,208.
This was due to mortgage payment on land and building, sellers
note, and bank debt.

HOLDING OPERATIONS:

Other income of $57,589 in fiscal year 1999 consisted primarily
of partial settlements with prior board members.

Operating expenses in fiscal year 1999 decreased approximately
$50,000 or 17% in comparison to the prior fiscal year 1998. The
decreases is due to decrease in officer's wages of $17,500,
professional fees of $24,000, and lower operating costs of
approximately $9,000.

Interest expense in fiscal year 1999 increased $89,746 in
comparison to prior fiscal year 1998. The increase is due to the
debentures sold to assist in the acquisition of Stinar.

FISCAL 1998

LIQUIDITY AND CAPITAL RESOURCES

The Company relies on cash flow from continuing cemetery and
Stinar operations to meet operating needs, debt and capital
requirements. The cemetery businesses have provided sufficient
cash during the past five years to support day-to-day operations,
current debt service, capital expenditures, and provide cash to
assist in the acquisition of Stinar. Since 1995 cash flow from
operations has increased and liquidity has continued to improve.
Cemetery and manufacturing operations will provide sufficient
cash during the next five years to cover all debt payments and
operation needs.

The Manufacturing operation has secured a $3,000,000 line of
credit to fund operations and capital expenditures and the
Cemetery operation has secured a line of credit for $225,000 to
meet any uncertainties that could materially affect liquidity.

There are no expected changes in the number of full time,
part-time or seasonal employees employed by the cemetery
operations, but manufacturing operations will need to hire an
additional 15 full time employees for production, 3 engineer's, 2
salesman and a vice president of manufacturing in fiscal year
1999.

RESULTS OF OPERATIONS

In fiscal year 1998, cemetery revenues increased 8.7% over the
prior fiscal year as a result of a 9% increase in case loads,
price increases of 10% on grave liners, 6% price increase in
interment fees, and a 58% increase in monument sales due to
aggressive marketing and a new display area. Investment income
form the cemetery trust funds decreased 10% due to timing of
interest payments.

Gross profit after operating expenses remained stable at 48%,
with cost of sales at 52%, which is comparable with prior years.

Selling expenses decrease 10% in comparison with prior years due
to the elimination of the sales manager position.

General and administrative expense decreased 3% due to decreased
legal fees associated with past litigation.

Other expenses increased 74% due to the Company's determination
that the likelihood of realizing a return on the property rights
investment to be remote, and accordingly, wrote off the
investment in property rights to zero, realizing an $250,000
loss.

ITEM 7: FINANCIAL STATEMENTS

The financial statements of the Company for the fiscal years
ending June 30, 1999 and 1998, located at Item 13, F-1, are
incorporated herein.

ITEM 8: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.

None

PART III

ITEM 9: DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
ACT.

Directors hold office for a one-year term or until their
successors are duly elected and qualify. Each director of the
Company has served continuously since the year indicated below.
The age as of September 9 ,1999 and principal occupation or
employment of all directors and executives are set forth below.

Robert C. Harvey, (48), has been a Director, Chairman of the
Board, CEO/CFO of Stinar Corporation, President of the Cemeteries
and sole director of the two business segments.

Robert B. Gregor, (48), Secretary and Director since 1993, Vice
President of Marketing and Sales at Stinar Corporation since 1999
and officer of the two cemeteries since 1993. From 1993 to 1998,
Mr. Gregor was the Senior Account Executive of E.F Johnson Co.

Hugh H. McDaniel, (59), Director since 1992. Mr. McDaniel has
been a residential real estate broker since 1973.

Marie Leshyn, (47), CFO/General Manager of Cemetery operations
since 1993.

<TABLE>
ITEM 10: EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

<CAPTION>
Annual Compensation Long Term Compensation
_________________________________ _______________________________
Awards Payouts
_______________________ _______
Name and Restricted Securities
principal Other annual Stock Underlying LTIP All other
position Year Salary Bonus compensation Awards Options/SARS payouts Compensation
($) ($) ($) ($) (#) ($) ($)
__________________________________________________________________________________________
<S> <C> <C> <C> <C> <C>

Robert C. Harvey(1)
Chairman of the Board
and Chief Executive
Officer

1999 90,000 50,000
1998 90,000 65,000

Robert B. Gregor
Secretary and
Vice-president

1999 45,000 14,167
1998 -

Marie Leshyn
CEO of cemetery

1999 79,310 25,069 9,200 14,167
1998 77,000 19,377 5,000
</TABLE>

(1) Mr. Harvey was employed by the Company as Chairman of the
Board and Chief Executive Officer in November 1992.

OPTION GRANTS AND EXERCISES

The following table summarizes options granted to Named Executive
Officer during 1999 and 1998.

Option Grants in Last Fiscal Year

Individual Grants

Number of
Securities % of Total Exercise
Underlying options Granted or Base
Options to Employees Price Expiration
Name (1) Granted in Fiscal year ($/SH) Date

Robert C Harvey
1999
1998 40,000(2) 100% $0.38 06/30/01

(1) All the options granted to Mr. Harvey was granted pursuant
to his employment contract. See "Executive Compensation and
Other Benefits - Employment Agreement". Options are exercisable
so long as Mr. Harvey remains in the employ of the Company.

(2) These options were granted on June 30, 1998 and are fully
vested.

EMPLOYMENT AGREEMENT

The Company had an employment contract with Mr. Harvey, the
Chairman of the Board and Chief Executive Officer of the Company.
Under the agreement, Mr. Harvey was to receive annual
compensation of $90,000 and a bonus equal to 10% of the Company's
net income over $300,000 and 15% of the Company's net income over
$500,000. Under this agreement, in addition to his salary and
bonus, Mr. Harvey was to receive options to purchase an
additional 10,000 shares at beginning of year, fair market value
for each $100,000 of net income the Company achieved over
$300,000 and options to purchase 40,000 shares based on the
performance of the Company's stock in the public market. Mr.
Harvey was granted options to purchase 40,000 shares in June 1998
under the terms of his employment agreement with the company. As
of September 9, 1999, no new agreement has been formalized.

During fiscal year 1999, the Company entered into employment
agreements with certain individuals that expire in 2001 through
2004. The agreements provide for annual stock options to be
granted on the respective anniversary dates for a total of 11,000
shares in 2000 and 2001, and 2,000 shares in 2002, 2003, 2004.
The options are exercisable upon issuance at fair market
value at date of grant.

COMPENSATION OF DIRECTORS

Directors who are not salaried employees of the Company are paid
$500 as an annual director's fee plus a fee of $200 per meeting
attended. Directors are also reimbursed for travel and lodging
expenses as appropriate. There was one board of directors'
meeting by telephone and one director received $700 for this
meeting.

On May 18, 1990, the Board of Directors approved a nonqualified
stock option plan for outside directors. Under the plan, each
outside director received options to purchase 3,500 shares of the
Company's common stock at an exercise price per share equal to
the market price at the grant date. These stock options are
exercisable for a period of ten years from the grant date for
active board members or for a period of twelve months from the
date of termination for former board members. The Company
reserved 21,000 shares of common stock for issuance under the
plan, of which an option for 3,500 shares is outstanding and
14,000 shares are available for issuance.

ITEM 11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.

The following table contains information as of June 30, 1999,
concerning the beneficial ownership of the Company's common
shares by Mr. Robert C. Harvey, each director, by all directors
and officers as a group, and by each person known to the Company
to "beneficially own" more than 5% of its common shares.

Name of Individual
or Persons in Group Number of Shares(a) % of Class

Robert C. Harvey 406,329(b) 28.7%
4810 120th Street West
Apple Valley, MN 55124

Robert B. Gregor 192,689(c) 13.6%
844 Oriole Lane
Chaska, MN 55337

Hugh McDaniel 5,100(d) .4%
4090 Mission Blvd.
San Diego, CA 92109

All officers and Directors 604,118 42.7%
as a Group (3 persons)

(a) Unless otherwise noted, all shares shown are held by persons
possessing sole voting and investments power with respect to such
shares.

(b) Includes 7,375 held by Mr. Harvey's wife and children to
which Mr. Harvey may be deemed to share voting and investment
power, but as to which he disclaims beneficial ownership. In
addition, 150,000 of the 406,329-share total listed in the table
are shares that could be acquired upon exercise of an option and
the conversion of convertible subordinated debentures. In
addition, 10,000 are held jointly by Mr. Harvey and his wife.

(c) Includes 7,375 held by Mr. Gregor's wife and children to
which Mr. Gregor may be deemed to share voting an investment
power, but as to which he disclaims beneficial ownership. In
addition, 112,564 are held jointly by Mr. Gregor and his wife.
Also, 50,000 of the 192,689 shares total listed in the table are
shares that could be acquired upon conversion of the convertible
subordinated debenture.

(d) Includes 3,500 of the 5,100 share total listed in the table
is shares that could be acquired upon exercise of options as a
board member.

ITEM 12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

During the years ended June 30, 1999 and 1998, amounts paid for
compliance services to entities elated to the chief executive
officer were $13,715 and $20,214 respectively. In addition, to
fund the purchase of substantially all of the assets and
liabilities of Stinar Corporation, a member of the board of
directors advanced cash of $30,000 in fiscal year 1998 and the
chief executive officer purchased $170,000 of convertible
subordinated debentures. In the fiscal year 1999, the director
was repaid the $30,000 and was sold 40,000 shares of common
stock out of treasury for $80,000. In fiscal year 1999 the Vice-
President of Manufacturing of Stinar was terminated. To settle
his termination, he demanded that his debenture be repurchased
for $100,000 and interest. Mr. Harvey and Mr. Gregor each
purchased $50,000 of the debenture and paid the interest due on
the debenture.

ITEM 13: EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K

FINANCIAL STATEMENTS

(a) The following documents are filed or incorporated by
reference as part of this Form 10-KSB.

(1) The following consolidated financial statements of Oakridge
Holdings, Inc. and Subsidiaries, together with the Independent
Auditors Report are filed in this report at Item 13, F-1.

Independent Auditor's Report

Consolidated Balance Sheets as of June 30, 1999 and 1998

Consolidated Statements of Operations for the Years Ended
June 30, 1999 and 1998

Consolidated Statements of Stockholders' Equity for the
Years Ended June 30, 1999 and 1998

Consolidated Statements of Cash Flows for the Years Ended
June 30, 1999 and 1998

Notes to Consolidated Financial Statements

EXHIBIT SCHEDULE:

(2) The schedule of exhibits required to be furnished by Item
601 of Regulations S-B is as follows:

3(i) Amended and Restated Articles of Incorporation as
amended (1)

3(ii)Amended and Superseding By-Laws as amended (1)

10(a)Outside Directors Non-Qualified Stock Option Plan(1)

10(b)Robert C. Harvey Employment Agreement (1)

10(c)Loan Documents for line of credit (2)

10(d)Subordinated Debenture Agreement (1)

10(e)Loan documents for Mortgage Note Payable (2)

10(f)Marie Leshyn Employment Agreement

10(g)Robert Gregor Employment Agreement

21 Subsidiaries of Registrant

22 1999 Stock Incentive Award Plan

(1) Filed as exhibit to Form 10-KSB for fiscal year ended
June 30, 1997

(2) Filed as exhibit to Form 10-KSB for fiscal year ended
June 30, 1998

(b) No reports of Form 8-K were filed during the first quarter
of the period covered by this report.

F-1

OAKRIDGE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 1999 AND 1998

TABLE OF CONTENTS

Page

Independent Auditors' Report 1

Consolidated Financial Statements:

Consolidated Balance Sheets 2

Consolidated Statements of Operations 3

Consolidated Statements of Stockholders' Equity 4

Consolidated Statements of Cash Flows 5

Notes to Consolidated Financial Statements 6

[Letterhead of Independent Auditors]

To The Board of Directors and Stockholders
Oakridge Holdings, Inc. and Subsidiaries
Apple Valley, Minnesota

INDEPENDENT AUDITORS' REPORT

We have audited the accompanying consolidated balance sheets of
Oakridge Holdings, Inc. and Subsidiaries as of June 30, 1999 and
1998, and the related consolidated statements of operations,
stockholders' equity and cash flows for the years then ended.
These consolidated financial statements are the responsibility of
the Company's management. Our responsibility is to express an
opinion on these consolidated 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 consolidated financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
consolidated 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 consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of Oakridge Holdings, Inc. and Subsidiaries as of June
30, 1999 and 1998, and the results of their operations and their
cash flows for the years then ended in conformity with generally
accepted accounting principles.

/S/ Stirtz Bernards Boyden Surdel & Larter, P.A.

Edina, Minnesota
August 25, 1999

OAKRIDGE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

June 30,
__________ __________

1999 1998
__________ __________

ASSETS

Current assets:

Cash and cash equivalents $ 950,907 $ 823,458

Receivables:

Trade, less allowance for doubtful
accounts of $33,000 in 1999 and
$11,000 in 1998 1,578,822 2,547,042
Trust income 9,425 20,350
Other 132,500 -

Inventories:
Production 1,854,221 2,829,142
Cemetery and mausoleum space
available for sale 634,887 663,791
Markers, urns and flowers 20,367 24,388
Deferred income taxes 102,000 245,000
Other current assets 36,514 10,731
---------- ----------
Total current assets 5,319,643 7,163,902
---------- ----------

Property and equipment 4,387,570 3,632,908
Less accumulated depreciation (1,539,730) (1,347,698)
---------- ----------
2,847,840 2,285,210
---------- ----------
Other assets 64,537 60,191
---------- ----------
$8,232,020 $9,509,303
========== ==========

June 30,
__________ __________

1999 1998
__________ __________

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Note payable - bank $1,346,556 $2,065,000
Notes payable - other 30,155 230,000
Accounts payable - trade 601,186 950,791
Accrued liabilities:
Accrued salaries and payroll taxes 375,657 469,980
Perpetual care trust funds 212,781 226,858
Deferred revenue 507,711 452,661
Customer deposits 25,248 329,914
Income taxes 39,000 -
Accrued marker and inscription costs 79,876 98,676
Accrued environmental costs 28,500 28,500
Other accrued liabilities 93,990 251,327
Current maturities of long-term debt 76,032 83,250
---------- ----------
Total current liabilities 3,416,692 5,186,957
---------- ----------
Long-term debt 3,044,075 3,123,833
---------- ----------

Commitments and contingencies - -
---------- ----------

Total liabilities 6,460,767 8,310,790
---------- ----------

Stockholders' equity:
Preferred stock, $.10 par value,
1,000,000 shares authorized; none
issued - -
Common stock, $.10 par value, 5,000,000
shares authorized; 1,388,003 and
1,309,670 shares issued and outstanding
in 1999 and 1998, respectively 138,801 130,968
Additional paid-in capital 2,017,250 1,940,500
Accumulated deficit (384,798) (872,955)
---------- ----------
Total stockholders' equity 1,771,253 1,198,513
---------- ----------
$8,232,020 $9,509,303
========== ==========

OAKRIDGE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended June 30,
___________ ___________

1999 1998
___________ ___________

Net sales $12,409,032 $2,767,214

Cost of good sold 9,802,382 1,306,614
----------- -----------
Gross margin 2,606,650 1,460,600

Selling, general and
administrative expenses 1,729,565 954,562
----------- -----------
Income from operations 877,085 506,038

----------- -----------
Other income (expense):
Interest expense (392,970) (73,042)
Loss on investment in property rights - (250,000)

Other 186,042 (1,070)
----------- -----------
Total other income (expense) (206,928) (324,112)
----------- -----------
Income before income taxes 670,157 181,926

Income taxes 182,000 52,000
----------- -----------
Net income $ 488,157 $ 129,926
=========== ===========

Basic net income per share $ .36 $ .10
=========== ===========

Diluted net income per share $ .29 $ .09
=========== ===========

<TABLE>
OAKRIDGE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

YEARS ENDED JUNE 30, 1999 AND 1998

<CAPTION>
Additional
Common Stock Paid-In Accumulated
Shares Amount Capital Deficit Total
<S> <C> <C> <C> <C> <C>

BALANCE, June 30, 1997 1,309,670 $130,968 $1,875,500 $(1,002,881) $1,003,587

Paid-in capital - stock
options, June 31, 1998 - - 65,000 - 65,000

Net income - - - 129,926 129,926
--------- -------- ---------- ----------- ----------

BALANCE, June 30, 1998 1,309,670 130,968 1,940,500 (872,955) 1,198,513
--------- -------- ---------- ----------- ----------
Issuance of common
stock for cash 40,000 4,000 76,000 - 80,000

Issuance of common
stock for services 15,000 1,500 41,000 - 42,500

Retirement of common stock (16,667) (1,667) (46,250) - (47,917)

Exercise of stock options 40,000 4,000 6,000 - 10,000

Net income - - - 488,157 488,157
--------- -------- ---------- ----------- ----------
BALANCE, June 30, 1999 1,388,003 $138,801 $2,017,250 $(384,798) $1,771,253
========= ======== ========== =========== ==========
</TABLE>

OAKRIDGE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

Increase (Decrease) In Cash And Cash Equivalents

Years Ended June 30,
___________ ___________

1999 1998
___________ ___________

Cash flows from operating activities:
Net income $ 488,157 $ 129,926

Adjustments to reconcile net income to
net cash flows from operating activities:
Depreciation 217,332 77,226
Deferred income taxes 143,000 50,000
Common stock received in settlement (47,917) -
Loss on investment in property rights - 250,000
Loss on disposal of equipment 4,500 -
Compensation expense - stock options - 65,000
Compensation expense - common stock 42,500 -
Receivables 846,645 75,845
Inventories 1,007,846 9,853
Other assets (35,134) 18,520
Accounts payable - trade (349,605) (61,397)
Accrued liabilities (495,153) 72,753
---------- ----------
Net cash flows from
operating activities 1,822,171 687,726
---------- ----------

Cash flows from investing activities:
Purchases of property and equipment (779,457) (150,289)
Acquisition, net of cash acquired
of $355,810 - (1,687,140)
---------- ----------
Net cash flows from
investing activities (779,457) (1,837,429)
---------- ----------

Cash flows from financing activities:
Principal payments on long-term debt
and other notes payable (286,821) (19,520)
Change in note payable - bank (718,444) 1,060,394
Proceeds from issuance of debentures
and other notes payable - 550,000
Proceeds from sale of common stock 80,000 -
Proceeds on exercise of stock options 10,000 -
---------- ----------
Net cash flows from
financing activities (915,265) 1,590,874
---------- ----------

Net change in cash and cash equivalents 127,449 441,171

Cash and cash equivalents,
beginning of year 823,458 382,287
---------- ----------

Cash and cash equivalents,
end of year $950,907 $823,458
========== ==========

Supplemental Disclosure of Cash Flow Information

Cash paid during the years for:
Interest 328,119 73,042
========== ==========

Income taxes 2,000 1,011
========== ==========

Details of acquisition:
Fair value of assets - 7,072,179
Liabilities - 5,029,229
---------- ----------
Cash paid - 2,042,950
Less cash acquired - 355,810
---------- ----------
Net cash paid for acquisition $ - $1,687,140
========== ==========

OAKRIDGE HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF BUSINESS

The Company is a Minnesota corporation organized on March 6,
1961. The Company operates two cemeteries in Illinois. The
cemetery operations routinely grant credit to pre-need customers,
substantially all of whom are in the Chicago area. On June 29,
1998, the Company acquired the net assets of an aviation ground
support equipment business (see Note 2). The business designs,
engineers and manufactures aviation ground support equipment
serving businesses domestically and internationally.

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of the
Company and its subsidiaries, each of which is wholly-owned. All
material intercompany balances and transactions have been
eliminated in consolidation.

ESTIMATES AND ASSUMPTIONS

The preparation of consolidated financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the consolidated financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual results
could differ from those estimates.

CASH AND CASH EQUIVALENTS

For purposes of the consolidated statements of cash flows, the
Company considers all highly liquid investments purchased with a
maturity of three months or less to be cash equivalents.

INVENTORIES

Production inventories are stated at the lower of cost or market.
Cost is determined on the first-in, first-out (FIFO) method.

The cemetery and mausoleum space available for sale is stated at
the lower of cost (determined by an allocation of the total
purchase and development costs of each of the properties to the
number of spaces available) or market. Included in cemetery space
available for sale is land held in a land trust in which a
wholly-owned subsidiary of the Company is the sole beneficiary.

PROPERTY AND EQUIPMENT

Property and equipment are carried at cost. Depreciation is
computed using the straight-line method over the estimated useful
lives of the related assets. When assets are retired or otherwise
disposed of, the cost and related accumulated depreciation are
removed from the accounts and any resulting gain or loss is
recognized in income for the period. The cost of maintenance and
repairs is charged to operations as incurred and significant
renewals and betterments are capitalized.

CEMETERY AND MAUSOLEUM SPACE REVENUE

Under the Cemetery Care Act of the State of Illinois, the Company
is required to transfer a portion of the proceeds of each sale of
cemetery and mausoleum space to perpetual care trust funds. The
reported net revenue has been reduced by the portion of the sales
price that is required to be remitted to the perpetual care
trusts.

Income on the perpetual care trust funds is recorded as cemetery
revenue in the accompanying consolidated financial statements as
earned. Distributions from the perpetual care trusts are used for
care and maintenance of the cemetery. Expenses are recognized as
incurred.

DEFERRED REVENUE

Deferred revenue consists of pre-need contracts that include
charges for services to be performed at a later date. Revenue on
these services is deferred to the period in which the services
are performed.

INCOME TAXES

Income taxes are provided for the tax effects of transactions
reported in the consolidated financial statements and consist of
taxes currently due plus deferred income taxes. Deferred income
taxes relate to differences between the financial and tax bases
of certain assets and liabilities. The significant temporary
differences relate to fixed assets, valuation allowances, certain
accruals and operating loss carryforwards that are available to
offset future taxable income. Deferred income tax assets and
liabilities represent the future tax return consequences of those
differences, which will either be taxable or deductible when the
assets and liabilities are recovered or settled.

ENVIRONMENTAL COSTS

Environmental expenditures that pertain to current operations or
relate to future revenue are expensed or capitalized consistent
with the Company's capitalization policy. Expenditures that
result from the remediation of an existing condition caused by
past operations that do not contribute to current or future
revenue are expensed. Liabilities are recognized for remedial
activities when the clean-up is probable and the cost can be
reasonably estimated.

CONCENTRATIONS OF CREDIT RISK

The Company's cash deposits from time to time exceed federally
insured limits. The Company has not experienced any losses on its
cash deposits in the past.

Financial instruments which potentially subject the Company to a
concentration of credit risk consist principally of accounts
receivable. The Company generally does not require collateral
for its trade accounts receivable. The credit risk is limited
due to the large number of entities comprising the Company's
customer base. At June 30, 1999, the Company had no significant
concentrations of credit risk.

INCOME PER SHARE

The Company has adopted the provisions of Statement of Financial
Accounting Standards No. 128, "Earnings Per Share" (SFAS No.
128). SFAS No. 128 establishes accounting standards for computing
and presenting earnings per share. Basic earnings per common
share are computed by dividing net income by the weighted average
number of shares of common stock outstanding during the period.
No dilution for potentially dilutive securities is included.
Diluted earnings per share are computed under the treasury stock
method and are calculated to compute the dilutive effect of
outstanding options, warrants and other securities. The adoption
had no effect on previously reported income per share.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In June 1998, the Financial Accounting Standards Board issued
SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities." SFAS No. 133 establishes accounting and reporting
standards for derivative instruments, including certain
derivative instruments embedded in other contracts (collectively
referred to as derivatives) and for hedging activities. SFAS No.
133 is effective for all fiscal quarters of fiscal years
beginning after June 15, 2000. The Company does not expect SFAS
No. 133 to materially affect its financial position or results of
operations.

2. ACQUISITION

On June 29, 1998, the Company acquired certain assets and
liabilities of Stinar Corporation (Stinar) for $4,242,950
including acquisition costs. Stinar designs, engineers and
manufactures aviation ground support equipment. The purchase
price included $2,000,000 in cash, the issuance of $1,300,000 of
contracts for deed, a $200,000 short-term note and $700,000 of
convertible subordinated debentures. The transaction was
accounted for using the purchase method. Accordingly, the
purchase price was allocated to net assets acquired based on
their estimated fair values. The excess of the purchase price
over the fair value of net assets acquired of approximately
$50,100 is being amortized on a straight-line basis over 10
years. The results of operations of the acquired business from
the date of acquisition to June 30, 1998 are not significant and
are reflected in the Company's operations beginning July 1, 1998.

The following summarized unaudited pro forma results of
operations for the year ended June 30, 1998 assumes the Stinar
acquisition occurred on July 1 of 1997:

PRO FORMA INFORMATION

1998

Net sales $15,483,743
Net earnings $220,299
Earnings per share $ .17

Pro forma results reflect adjustments for the incremental
interest expense on debt incurred to finance the acquisition,
depreciation and amortization of assets based on purchase price
allocation and estimated income tax expense. The pro forma
results are not necessarily indicative of what actually would
have occurred if the acquisition had been completed as of the
beginning of 1998, nor are they necessarily indicative of future
consolidated results.

3.INVENTORIES

Production inventories consist of the following:

1999 1998

Finished goods $170,173 $230,066
Work in progress 945,782 1,146,295
Raw materials and trucks in stock 738,266 1,452,781
---------- ----------
$1,854,221 $2,829,142
========== ==========

Inventories of cemetery and mausoleum space available for sale
consist of the following:

1999 1998

Cemetery space $521,783 539,940
Mausoleum space 113,104 123,851
---------- ----------
$634,887 $663,791
========== ==========

4. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

1999 1998

Land $450,000 450,000
Land improvements 417,344 288,092
Building and improvements 1,798,692 1,422,881
Vehicles 291,836 250,114
Equipment 1,429,698 1,221,821
---------- ----------
$4,387,570 $3,632,908
========== ==========

Depreciation charged to operations was $212,327 in 1999 and
$77,226 in 1998.

5. INVESTMENT IN PROPERTY RIGHTS

In December 1994, the Company purchased the right to develop ten
dwelling units for $250,000 from Mohave Shore Development Inc.
(MSD), a Nevada corporation. MSD has a master lease agreement
with the Fort Mohave Tribal Corporation located in Arizona. The
right has a term of 50 years. In addition, the Company has the
right to purchase 31 additional development units in increments
with each increment requiring additional fees to a total
aggregate of $1,300,000. In 1998, the Company determined that the
likelihood of realizing a return on this investment to be remote
and accordingly wrote off the investment in property rights to $0
realizing a $250,000 loss.

6. NOTE PAYABLE - BANK

The Company has a $225,000 line-of-credit of which $219,997 was
unused and available at June 30, 1999. Interest is payable
monthly at the prime rate (7.75% at June 30, 1999). The note is
secured by the assets of a wholly-owned subsidiary and matures
October 31, 1999.

The Company has a $3,000,000 line-of-credit of which $1,341,553
was outstanding at June 30, 1999. At June 30, 1999, approximately
$625,000 of the line-of-credit was unused and available. Advances
on the line-of-credit are based on 80% of eligible accounts
receivable plus 75% of the eligible truck, work-in-process and
finished goods inventory plus 50% of the eligible raw materials
inventory. Interest is payable monthly at the banks reference
rate plus .75% (8.5% at June 30, 1999). The note matures October
1, 1999 and is secured by the assets of the Company's wholly
owned subsidiary, Stinar HG, Inc., and by assignment of life
insurance policies. As of June 30, 1999, the Company was not in
compliance with certain financial covenants related to tangible
net worth. The bank intends to waive those covenants as of June
30, 1999.

7. NOTES PAYABLE - OTHER

Notes payable - other consisted of the following:

1999 1998
Note payable to individuals -
interest at 8.25%, secured by a
second priority lien on certain
inventories, accounts, equipment,
and general intangibles. $30,155 $200,000

Unsecured note payable to an
officer, interest at 9%, repaid
July 1998. - 30,000
---------- ----------
$30,155 $230,000
========== ==========

8. LONG-TERM DEBT

Long-term debt consisted of the following:

1999 1998
Mortgage note payable - bank,
payable in monthly installments of
$9,350 including interest at 8.625%,
maturing January 2002, secured by
real estate and the assets of
the Company. $616,445 $675,767

Other notes payable, payable in
monthly installments including
interest at 8.75%, maturing through
November 1999, secured by equipment. 2,989 11,316

Contracts for deed, payable in
monthly installments of $8,264 and
$1,503 including interest at 8.25%,
maturing in June 2005, secured by
certain property. 1,280,673 1,300,000
---------- ----------

Long-term debt before debentures 1,900,107 1,987,083

Convertible subordinated debentures
- - 9% interest, due annually each
December 31, convertible into one
common share at a conversion price
equal to 75% of the mean between the
average closing "bid" and "ask" price
on each of the five trading days
prior to the conversion date, issued
to owners of the business acquired,
payable in annual installments of
$200,000 commencing June 2001, 2002
and 2003, with the final $100,000
payment due in June 2004,unsecured,
redeemable by the Company with 10
days written notice. 700,000 700,000

Convertible subordinated debentures
- - 9% interest due annually each
December 31, convertible into one
common share for each $2.00 of the
principal amount, maturing in July
2006, unsecured, $270,000 of the
debentures were issued to an
officer and employee of the Company. 520,000 520,000

---------- ----------
3,120,107 3,207,083
Less current maturities (76,032) (83,250)
---------- ----------
$3,044,075 $3,123,833
========== ==========

Subsequent maturities as of June 30, 1999 are as follows:

Years Ending June 30:
2000 $ 76,032
2001 279,550
2002 702,988
2003 215,342
2004 116,657
Thereafter 1,729,538
----------
$3,120,107
==========

9. ENVIRONMENTAL COSTS

In 1995, the Company commissioned an engineering study of its
property for the purpose of determining the full extent of
possible soil contamination. Five underground fuel tanks were
found to require removal and the adjoining soil to undergo
remediation. Environmental costs expensed to operations were $-
0- in 1999 and 1998 and approximately $228,000 in years prior to
those presented.

Furthermore, the Company was notified by the Illinois
Environmental Protection Agency (IEPA) that the clean-up plan may
not be in full compliance with IEPA guidelines. The Company has
responded to the IEPA with a work plan that calls for additional
costs of approximately $28,500 with the possibility of additional
costs. The Company is awaiting a response on the work plan from
the IEPA. Additional costs beyond the $28,500 accrued for at June
30, 1999 may be incurred, however, management cannot reasonably
estimate those costs. In addition, the Company may not file for
reimbursement from the Leaking Underground Storage Tank Fund
until the work plan has IEPA approval. Accordingly, the Company
has made no provision for reimbursements.

10. INCOME TAXES

The provision for income taxes consisted on the following:

1999 1998
---------- ----------
Current:
Federal $22,000 $ -
State 17,000 2,000
---------- ----------
39,000 2,000

Deferred:
Federal 139,000 44,000
State 4,000 6,000
---------- ----------
143,000 50,000
---------- ----------

$182,000 $ 52,000
========== ==========

Principal reasons for variations between the statutory federal
tax rate and the effective tax rate were as follows:

1999 1998

Statutory U.S. federal tax rate 34% 34%

State taxes, net of federal benefit 2 3

Federal surtax exemption (2) (4)

Utilization of deferred income tax
assets at rates different than
originally capitalized (5) (4)

Other (2) -
------ ------
27% 29%
====== ======

The net deferred income tax assets in the accompanying
consolidated balance sheets included the following components as
of June 30, 1999 and 1998:

1999 1998

Deferred income tax liabilities $(15,000) $(10,000)
Deferred income tax assets:
Net operating loss carryforwards - 156,000
Environmental liability 8,000 8,000
Accrued vacation 53,400 51,800
Other 55,600 56,100
Valuation allowance - (16,900)
---------- ----------

Net deferred income tax assets $102,000 245,000
========== ==========

11. OTHER RELATED PARTY TRANSACTIONS

During the years ended June 30, 1999 and 1998 amounts paid for
compliance services to entities related to the chief executive
officer were $13,715 and $20,124, respectively.

12. PENSION PLAN

Certain subsidiaries of the Company participate in a multi-
employer union administered defined benefit pension plan that
covers the cemetery employees. Pension expense under this plan
was $15,600 in 1999 and $14,950 in 1998.

13. EMPLOYMENT CONTRACTS AND STOCK OPTIONS

The Company was committed under an employment contract with its
chief executive officer (CEO) to pay annual compensation and
bonus payments for three years ending December 31, 1998. Under
this agreement, the Company was committed to pay a bonus of 10%
of the Company net income over $300,000 and 15% of the Company
net income over $500,000. The Company accrued $0 under these
terms of the agreement for the years ended June 30, 1999, and
1998. The annual compensation expense under the employment
contract was $90,000. As of June 30, 1999, no new agreement had
been formalized.

In addition, the contract also provided for stock options subject
to certain performance levels:

a) 10,000 shares at beginning of year fair market value for each
$100,000 of net income over a base income amount of $300,000.

b) 40,000 shares at beginning of year fair market value based on
the performance of the Company's stock in the public market.

The employment agreement expired December 31, 1998, and the
exercise date of the stock options must be within three years
of their grant or 90 days after the termination of the CEO's
employment, whichever is first.

Under the agreement, stock options for 40,000 shares of common
stock at $.38 per share were earned in 1998. Compensation expense
of $65,000 was recognized with these stock options. No stock
options were issued in 1999.

On September 1, 1998, the Board of Directors approved a stock
incentive awards plan to attract and retain individuals to
contribute to the achievement of the Company's economic
objectives. Under the plan, individuals will be eligible based on
judgement of a committee of Board members (committee). At the
discretion of the committee, eligible recipients may be granted
options to purchase shares of the Company's common stock at an
exercise price per share equal to the market price at the grant
date. The stock options are exercisable at such times and in such
installments as determined by the committee, limited to a maximum
of ten years from the date of the grant. The Company reserved
175,000 shares of common stock for issuance under the plan. As of
June 30, 1999, no options have been granted.

During 1999, the Company entered into employment agreements with
certain individuals that expire 2001 through 2004. The agreements
provide for annual stock options to be granted on the respective
anniversary date in total in the amount of 11,000 shares in 2000
and 2001 and 2,000 shares in 2002, 2003, and 2004. The options
are exercisable upon issuance at fair market value at date of
grant.

Shares subject to option are summarized as follows:

1990 Employment Weighted
Stock Contract Average
Option Options Exercise
Plan Price

BALANCE, June 30, 1997 3,500 40,000 $ .25

Options granted - 40,000 $ .38
------ -------
BALANCE, June 30, 1998 3,500 80,000 $ .31

Options exercised - (40,000) $ .25

BALANCE, June 30, 1999 3,500 40,000 $ .37
====== =======

Options exercisable at:

June 30, 1998 3,500 80,000 $ .31
June 30, 1999 3,500 40,000 $ .37

Information regarding options outstanding at June 30, 1999 is as
follows:

Type of Option Number of Exercise Weighted Weighted
Options Price Average Average
Range Exercise Remaining
Price Contractual
Life

1990 Stock Option Plan 3,500 $ .25 $ .25 3.0 Years
Employment contract 40,000 $ .38 $ .38 2.0 Years

The Company applies Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees," and related
Interpretations in accounting for its options. Had compensation
cost been recognized based on the provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation," the Company's net
income would have been as follows:

1999 1998
---------- ----------
Net Income
As reported $486,157 $129,926
Pro forma $486,157 $128,426

The weighted average fair value of options granted was $1.68 in
1998. There were no options granted in 1999. The fair value of
each option is estimated on the date of grant using the
Black-Scholes option pricing model. The weighted average
assumptions used for grants in 1998 were as follows:

1998

Risk free interest rate 5.50%
Expected life of options 3 Years
Expected volatility 35.85%
Expected dividend yield -

14. CEMETERY AND MAUSOLEUM TRUST FUNDS

Two of the Company's wholly-owned subsidiaries are beneficiaries
of perpetual care trust funds established under the Cemetery Care
Act of the State of Illinois. Earnings on these perpetual care
trust funds are to be used for the care, preservation and
ornamentation of the Company's cemetery and mausoleum properties.

Earnings on these perpetual care trust funds totaled $184,646 in
1999 and $202,014 in 1998.

Perpetual care trust fund assets totaled approximately $4,170,000
and $4,100,000 at June 30, 1999 and 1998, respectively.

15. EARNINGS PER SHARE OF COMMON STOCK DISCLOSURES

The following table reconciles the income and shares of the basic and diluted
earnings per share computations:

<TABLE>
<CAPTION>
1999 1998

Income Shares Per-Share Income Shares Per-Share
(Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
<S> <C> <C> <C> <C> <C> <C>

BASIC EPS

Income available $488,157 1,344,250 $.36 $129,926 1,309,670 $.10
to common
shareholders

EFFECT OF DILUTIVE SECURITIES

Employee
Contract - 34,146 - 60,863

1990 Option
plan - 3,159 - 2,830

Convertible
debentures 76,900 567,154 - -

DILUTED EPS

Income available
to common
stockholders
plus assumed
conversions $565,057 1,948,709 $.29 $129,926 1,373,363 $.09
</TABLE>

16. SEGMENT INFORMATION

The Company's operations are classified into two principal
industry segments: cemeteries and aviation ground support
equipment. The accounting policies of the segments are the same
as those described in the summary of significant accounting
policies. The company evaluates performance based on profit or
loss from operations before income taxes. Financial information
by industry segment as of and for the years ended June 30, 1999
and 1998 is summarized as follows:

Aviation
Ground
Support
Cemeteries Equipment Total

1999
Net sales - external $2,790,195 $9,618,837 $12,409,032
Depreciation and
amortization 91,021 126,311 217,332
Interest expense 1,302 231,208 232,510
Segment operating profit 877,801 140,827 1,018,628
Segment assets 3,072,662 5,408,274 8,480,936
Expenditures for segment
fixed assets 267,634 511,823 779,457

1998
Net sales - external $2,767,214 $ 2,767,214
Depreciation and
amortizaation 77,226 77,226
Intereat expense 2,329 2,329
Segment operating profit 798,035 798,035
Segment assets 2,176,457 $7,072,180 9,248,637
Expenditures for segment
fixed assets 150,289 1,738,230 1,888,519

Reconciliation of segment profit to consolidated income before
income taxes is as follows:

1999 1998
---------- ----------

Total profit for reportable segments $1,018,628 $ 798,035
Unallocated amounts:
Interest expense (160,460) (70,713)
Other corporate expenses (188,011) (545,396)
---------- ----------
Income before income taxes $ 670,157 $ 181,926
========== ==========

Reconciliation of segment assets to consolidated asset is as
follows:

1999 1998
---------- ----------

Total segment assets $8,480,936 $9,248,637
Other assets 196,227 347,500
Elimination of receivable from
corporate headquarters (445,143) (86,834)
---------- ----------
Total assets $8,232,020 $9,509,303
========== ==========

The results of operations of the aviation ground support
equipment business are reflected in the Company's operations
beginning July 1, 1998 (see Note 2). approximately 20% of
aviation ground support equipment net sales area to foreign
entities.

Segment profit represents segment revenues less directly related
operating expenditures of the Company's segments. Management
believes this is the most meaningful measurement of each
segment's results as it excludes consideration of corporate
expenses which are common to both business segments.

Other corporate expenses consist principally of senior
management's compensation, and general and administrative
expenses. These costs generally would not be subject to
significant reduction upon the discontinuance or disposal of one
of the segments.

17. FAIR VALUES OF FINANCIAL INSTRUMENTS

The estimated fair values of the Company's financial instruments
at June 30, 1999, and the methods and assumptions used to
estimate such fair values, were as follows:

CASH AND CASH EQUIVALENTS - the fair value approximates the
carrying amount because of the short maturity of those financial
instruments.

LONG-TERM DEBT AND OTHER NOTES PAYABLE - the fair value
approximates the carrying amount, as the interest rates on the
debt approximate current interest rates.

18. COMMITMENTS AND CONTINGENCIES

The Company is in labor negotiations with its Illinois cemetery
employees represented by Local #1, of the Service Employees
International Union, AFL-CIO, CLC, whose contract expired
February 29, 1999. If the Company is unable to reach a negotiated
settlement, a strike could occur which would depress cemetery
revenues and disrupt cemetery operations.

19. OTHER INCOME

Included in 1999 other income is a settlement with the Illinois
Department of Transportation regarding condemnation of property
for $132,500.

20. RECLASSIFICATIONS

Certain reclassifications were made to the 1998 consolidated
financial statements to conform to the 1999 presentation which
had no effect on net income.

SIGNATURES

In accordance with Section 13 or 15 (d) of the Exchange Act,
the Company has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

OAKRIDGE HOLDINGS, INC.

Dated: September 27, 1999 By /S/ Robert C. Harvey
Robert C. Harvey
Chairman of the Board of Directors

In accordance with the Exchange Act, this report has also
been signed below by the following persons on behalf of the
Company and in the capacities and on the dates indicated.

Dated: September 27, 1999 By /S/ Robert C. Harvey
Robert C. Harvey
Chief Executive Officer
Chief Financial Officer

Dated: September 27, 1999 By /S/ Robert B. Gregor
Robert B. Gregor
Secretary
Director

EMPLOYMENT AGREEMENT

This Employment Agreement ("Agreement") is made this 1st day
of July 1998, by and among Oakridge Holdings, Inc. (the
"Company"), a Minnesota corporation with offices a 4810 120th
Street West, Apple Valley, Minnesota 55124, and Marie Leshyn
("Leshyn"), 15519 New England Avenue, Oak Forest, Illinois 60452.

WHEREAS, upon the terms and subject to the conditions of
this Agreement, the Company desires to employ Leshyn and Leshyn
desires to accept employment by the Company;

NOW THEREFORE, in consideration of the mutual covenants set
forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:

1. Employment

Upon the terms and subject to the conditions of this
Agreement, the Company hereby employs Leshyn and Leshyn
hereby accepts employment by the Company in the capacity
hereinafter set forth.

2. Term of Employment

The term of this Agreement and Leshyn's employment hereunder
shall commence effective as of July 1, 1998 (the
"Commencement Date") and shall continue through June 30,
2003.

3. Duties

a. Office. During the term of this Agreement, Leshyn
shall serve as General Manager of the operations of
Oakridge Cemetery (Hillside), Inc. and Glen Oak
Cemetery Company, wholly owned subsidiaries of the
Company (the "Cemetery Subsidiaries"), at the direction
of the Board of Directors of the Company (the "Board"),
and Leshyn shall perform the duties, undertake the
responsibilities and exercise the authority customarily
performed, undertaken and exercised by a person in such
position in a business similar to the business in which
the cemetery Subsidiaries are engaged.

b. Extent of Service. During the term of this Agreement,
Leshyn shall perform faithfully the duties of her
employment to the best of her ability and devote all of
her business attention to the transaction of the
business of the Cemetery Subsidiaries. Leshyn may
pursue other business activities or be employed by
another entity during the term of this Agreement,
provided that such activities or employment do not
interfere with Leshyn's performance of her duties under
this Agreement as determined by the Board.

4. Compensation

a. Base Salary. In consideration of the services rendered
by Leshyn under this Agreement, during the term of this
Agreement the Company shall pay Leshyn a base salary
("Base Salary") at the rate of $79,310 per year. This
Base Salary shall be payable at regular intervals in
accordance with the Company's payroll practices. Base
salary starting July 1, 1999 shall be $81,689, July 1,
2000 shall be $84,140, July 1, 2001 shall be $86,663,
and July 1, 2002 $ 89,263.

b. Bonus Compensation

(1) Bonus Compensation. Subject to Paragraph 4 (b)
(3) below, the Company shall pay Leshyn additional
compensation for her services ("Bonus
Compensation") based upon the requirements
specified in Paragraph 4 (b) (4) below.

(2) Payment of Bonus Compensation. The Bonus
Compensation provided for in this Paragraph 4 (b)
shall be paid to Leshyn within 90 days after the
issuance for the audited financial statements
following the close of the Company's fiscal year
or, in connection with termination of Leshyn's
employment, within 90 days after issuance of the
Company's unaudited financial statements as
described in Paragraph 4 (b) (3) below.

(3) Bonus payment in Event of Termination. To the
extent that the Company will pay any Bonus
Compensation for a fiscal year in which Leshyn's
employment is terminated, the amount of such Bonus
Compensation to be paid shall be calculated as
described in Paragraph 4 (b) (4) below except that
the fiscal year will be deemed to end as of the
end of the month nearest Leshyn's Date of
Termination (as defined in Paragraph 7 (c) below)
and the calculation of net income from operations
before depreciation and income taxes ( interest
from perpetual care funds will not be included in
net income from operations) will be based on the
Company's unaudited financial statements as of
such month end.

(4) Calculation of Bonus Payment. With respect to
each fiscal year, the Company will pay Leshyn 5%
of the aggregate net income from operations before
depreciation (interest from perpetual care funds
will not be included in net income from
operations) of the Cemetery Subsidiaries over
$300,000 as set forth in the audited financial
statements of the Cemetery Subsidiaries for such
fiscal year.

c. Signing Bonus. Upon execution of this Agreement,
Employee will receive 5,000 shares of the common stock
of Holdings, $0.10 par value (the Common Stock ), in
substantially the form of Exhibit A attached hereto.

5. Stock Options.

a. Annual Grant.On each of the first, second, third,
fourth and fifth anniversary dates of this Agreement
and has remained fully employed by the Company at all
times during such years. Employee will receive an
incentive stock option under the plan to purchase 2,000
shares of common stock.

b. Discretionary Annual Grant. The President of the
Company may, in his sole discretion, authorize the
grant to Employee of incentive stock options under the
Plan to purchase up to 5,000 shares of common stock.

6. Miscellaneous Provisions Regarding Stock Options

a. Stock Option Agreement: Exercise Price and Vesting.
All options granted hereunder shall be made pursuant to
an Incentive Stock Option Agreement in substantially
the form of Exhibit A attached hereto. All such
options will have an exercise price equal to 100% of
the fair market value per share and will exercisable
upon issuance by Holdings.

b. The Plan. All options granted hereunder shall be
issued pursuant to and governed by the terms of the
Plan, and in the event of a conflict between the terms
of the Plan and this Agreement, the terms of the Plan
will govern.

6. Benefits

a. Disability. In the event that Leshyn is unable to
perform her duties under this Agreement due to her
Disability (as defined in Paragraph 7 (a) (1) below),
the Company will continue to pay Leshyn 70% of her Base
Salary for a period of 26 weeks after she becomes
disabled. In addition, the Company will reimburse
Leshyn for premiums on a long-term disability insurance
policy that provides benefits of $3,000 per month after
a six month waiting period.

b. Life Insurance. The Company will reimburse Leshyn for
premiums on a term life insurance policy that provides
death benefits to Leshyn's designated beneficiaries in
an amount equal to two times her Base Salary.

c. Medical Insurance. The Company will reimburse Leshyn
for premiums on a medical and hospitalization insurance
policy for Leshyn and her dependents.

d. Simple IRA Plan. The Company has established a Simple
IRA Plan and agree to contribute on behalf of Leshyn as
it contributes for other plan participants.

e. Vacation; Personal Days. Leshyn will be entitled to
vacation periods, holidays and personal days on the
same schedule and conditions and for the same duration
as is provided in the union contract applicable to the
Company's employees except Leshyn will receive five
weeks of paid vacation yearly.

f. Aggregate Premium Reimbursement. In connection with
reimbursement of premiums on the long-term disability,
life and medical insurance policies described above,
the Company will not be required to reimburse Leshyn
for more than an aggregate of a $5,000 per year.

7. Expenses

The Company shall reimburse Leshyn for all reasonable
business expenses incurred or paid by her that the Board
determines were incurred in connection with the performance
of her duties hereunder upon presentation of expense
statements or vouchers and such other supporting
documentation as the Board may from time to time request.

The Company shall give Leshyn a auto allowance for $350 per
month during the term of the contract, unless Leshyn or the
company terminate the contract.

The Company shall assist Leshyn in obtaining her Certified
Cemetery Executive (CCE) designation. To this extent they
will sponsor her attendance at industry sponsored continuing
professional education programs. Total expenses to obtain
the CCE shall not be greater than $5,000 per year.

8. Events of Termination

a. Termination. Either the Company or Leshyn may
terminate Leshyn's employment with the Company. The
Company may terminate Leshyn's employment with or
without cause. The Company may also terminate Leshyn's
employment in the event of her Disability. Leshyn's
employment shall automatically terminate upon her
death.

(1) Disability. For purposes of this Paragraph 7,
"disability" means a physical or mental infirmity
which impairs Leshyn's ability to substantially
perform her duties under this Agreement in the
opinion of a physician selected by mutual
agreement between Leshyn and the Company.

(2) For-Cause. For purposes of this Paragraph, "for-
cause" means a material breach of the terms of
this Agreement, including but not limited to a
willful breach of an obligation assumed under this
Agreement, unlawful criminal activity, willful
breach of duty, neglect of properly assigned
duties or a violation of Paragraphs 9 and 10
hereof as determined by the Board.

b. Notice of Termination. Notice of termination of
Leshyn's employment must be communicated as provided in
Paragraph 12 below except notice need not be given if
Leshyn's employment terminates because of her death or
the contract expires.

c. Date of Termination. Termination of Leshyn's
employment under this Paragraph 7 will be effective on
the date of delivery of the Notice of Termination,
unless termination occurs as a result of Leshyn's death
in which case her employment terminates on the day of
her death (the "Date of Termination") or her contract
expires.

8. Compensation Upon Termination

a. If for Disability or Death. If Leshyn's employment is
terminated as a result of her Disability or death, the
Company will pay Leshyn in a single payment an amount
equal to 30 days of salary at the Base Salary rate in
effect on the Date of Termination plus $450 of benefit
compensation, all earned vacation and personal time
earned but not used and any Bonus Compensation through
the Date of Termination, determined as described in
Paragraph 4 (b) above.

b. If For-Cause. If the Company terminates Leshyn's
employment for-cause, upon Leshyn giving the Company a
written, complete release of the Company for any and
all liability, the Company will pay Leshyn in a single
payment an amount equal to 30 days of salary at the
Base Salary rate in effect on the date of termination
plus $450 of benefit compensation.

c. If By the Company Without Cause. If the Company
terminates Leshyn's employment without cause, the
Company will pay Leshyn in a single payment one and
one-half times her then current Base Salary, plus all
earned vacation, bonus in agreement with section 4(b)
and earned personal time not used.

d. If By Leshyn. If Leshyn terminates her employment, she
forfeits all claims for any compensation or other
benefits under this Agreement.

9. Confidential Information

Leshyn acknowledges that the information, observations and
data obtained by her during the course of her performance
under this Agreement concerning the business or affairs of
the Company and its affiliates are the property of the
Company. Therefore, except as may otherwise be required by
law, Leshyn agrees that she will not disclose to any
unauthorized person or use for her own account any of such
information, observations or data without the written
consent of the Company, unless and to the extent that the
aforementioned matters become generally known to and
available for use by the public other than as a result of
Leshyn's acts or omissions to act. Leshyn agrees to deliver
to the Company at the termination of her employment, or at
any other time the Board may request, all memoranda, notes,
plans, records, reports and other documents (and copies
thereof) relating to the business of the Company and its
affiliates which she may then possess of have under her
control.

10. Noncompetition

Leshyn shall not alone, or in any capacity with another,
during her employment with the Company, or for three months
after the termination of her employment with the Company,
unless Leshyn has received from the Board prior written
consent to the contrary:

a. Directly or indirectly engage in any business activity
that competes with the business of the Cemetery
Subsidiaries;

b. In any way interfere or attempt to interfere with the
Company's relationship with any of its customers or
potential customers; or

c. After the conclusion of her employment, attempt to
employ any of the employees of the Company on behalf of
any other entity competing with the Company.

11. Successors and Assigns

a. Company Successors and Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the
Company, its successors and assigns. The term "the
Company" as used herein shall include such successors
and assigns. The term "successors and assigns" as used
herein shall include a corporation or other entity
acquiring all or substantially all the assets and
business of the Cemetery Subsidiaries (including this
Agreement) whether by operation of law or otherwise.

b. Leshyn's Successors and Assigns. Neither this
Agreement not any duty, obligation, right or interest
hereunder shall be assignable by Leshyn, her
beneficiaries, or legal representatives without the
Company's prior written consent; provided, however,
that nothing in this Paragraph 11 shall preclude (i)
Leshyn from designating a beneficiary to receive any
benefit payable hereunder upon her death, or (ii) the
executors, administrators, or other legal
representatives of Leshyn or her estate from assigning
any rights hereunder to devisees, legatees,
beneficiaries, a testamentary trustee or other legal
heirs of Leshyn (each a "Distributee"). All amounts
payable under this Agreement upon Leshyn's death,
unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to Leshyn's
Distributee or, if there is no such Distributee, to her
estate.

12. Notices

Any notice required or permitted by this Agreement shall be
given by registered or certified mail, return receipt
requested, addressed to the Company, or to Leshyn, at their
respective address specified on page 1 of this Agreement, or
to any party hereto at such other address or addresses as he
or it may from time to time specify for such purpose in a
notice similarly given. Any such notice shall be deemed
given on the date of delivery as certified.

13. Dispute Resolution

a. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of
Minnesota without regard to the conflicts of laws
provisions of any jurisdictions. Any legal proceeding
related to this Agreement will be brought in an
appropriate Minnesota court, and the parties consent to
the exclusive jurisdiction of Minnesota courts for this
purpose.

b. Injunctive Relief. Leshyn hereby acknowledges and
agrees that it would be difficult to fully compensate
the Company for damages for a breach or threatened
breach of Paragraphs 9 or 10. Accordingly, Leshyn
agrees that the Company shall be entitled to temporary
and permanent injunctive relief to enforce the
provisions of Paragraphs 9 or 10 hereof and that such
relief may be granted without the necessity or proving
actual damages. This provision with respect to
injunctive relief shall not limit the Company from
pursuing other rights or remedies available to the
Company for such breach or threatened breach, including
but not limited to, the recovery of damages from Leshyn
or any third party.

c. Arbitration. Except with respect to a claim for an
injunction under Paragraph 13 (b) or for other
equitable relief, any controversy or claim arising out
of, or relating to, this Agreement or its making,
performance, or interpretation shall be settled by
arbitration under the Commercial Arbitration Rules of
The American Arbitration Association, which arbitration
may be instituted by either party to this Agreement in
Minneapolis, Minnesota. Judgment on the arbitration
award may be entered in any court having jurisdiction
over the subject matter of the controversy. In such
arbitration, the parties shall be entitled to full
discovery to the extent permitted in a proceeding
brought in the trial courts of general jurisdiction.

14. Indemnification

The Company shall indemnify Leshyn and provide legal
representation to her with respect to any actions, claims or
proceedings which are based upon acts or omissions of Leshyn
related to the performance of her duties hereunder to the
extent permitted by law except any action, claim, or
proceeding between Leshyn and the Company.

15. Entire Agreement

This instrument contains the entire agreement of the parties
relating to the subject matter hereof, and there are no
restrictions, agreements, promises, covenants, undertakings,
representations, or warranties with respect to the subject
matter hereof other than those expressly set forth herein.
No modification of this Agreement shall be valid unless in
writing and signed by the parties hereto. The waiver of a
breach of any term of condition of this Agreement shall not
be deemed to constitute a waiver of any subsequent breach of
the same or any other term or condition of this Agreement.

16. Severability

If any term or provision of this Agreement or the
application thereof to any person, property or circumstance
shall to any extent be invalid or unenforceable, the
remainder of this Agreement shall not be affected thereby,
and each term and provision of this Agreement shall be valid
and enforceable to the fullest extent permitted by law.

17. Counterparts

This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original but all of which
together constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Agreement as of the day, month and year first
written above.

OAKRIDGE HOLDINGS, INC.

By: /S/ Robert C. Harvey
Robert C. Harvey
CEO/Chairman

By: /S/ Marie Leshyn
Marie Leshyn

EMPLOYMENT AGREEMENT

This Employment Agreement dated effective as of January
1, 1999, is by and between STINAR CORPORATION, a Minnesota
corporation located at 3255 Sibley Memorial Highway, Eagan,
Minnesota (the "Company") Robert Gregor, an individual
residing at 844 Oriole Lane, Chaska, MN (the "Employee").

A. The Employee is familiar with the Company's business
and products.

B. The parties wish to provide for the employment of the
Employee by the Company.

C. The Employee wishes to receive compensation from the
Company for the Employee's services, and the Company desires,
reasonable protection of its confidential business and technical
information that has been acquired and is being developed by the
Company at substantial expense.

D. The Company is the wholly-owned subsidiary of Oakridge
Holding, Inc., a Minnesota corporation ("Holdings"). Holdings has
established the Oakridge Holdings, Inc. 1998 Stock incentive
Awards Plan (the "Plan") pursuant to which eligible employees of
Holdings and its subsidiaries, including the Company, may, in the
discretion of the Board of Directors of Holdings, receive grants
of incentive and non-statutory stock options, and the Company and
Holdings wish to provide Employee with an opportunity to earn
options under the Plan in the event certain goals of the Company
and Employee are achieved.

E. The Company wishes to obtain reasonable protection
against unfair competition from the Employee following
termination of employment and to further protect against unfair
use of its confidential business and technical information and
the Employee is willing to grant the Company the benefits of a
covenant-not-to-compete for these purposes.

For good and valuable consideration, the receipt of which is
hereby acknowledged, the Company and the Employee each intending
to be legally bound, agree as follows:

1. Employment.

(a) Employment. Subject to all of the terms and
conditions of the Agreement, the Company agrees to employ the
Employee as its Vice President - Sales and Marketing, and the
Employee accepts such employment.

(b) Duties. The Employee will devote a minimum of
forty (40) hours per week to, and, during such time, make the
best use of Employee's energy, knowledge and training in
advancing the Company's interests. The Employee will diligently
and conscientiously perform the duties of the Employee's position
within the general guidelines to be determined by the Company's
Board of Directors (the "Board") and its President. While the
Employee is employed by the Company, the Employee will keep the
Company informed of any other business activities or outside
employment, and will promptly stop any activity or employment
that might conflict with the Company's interests or adversely
affect the performance of the Employee's duties for the Company.

2. Compensation.

(a) Salary. The company agrees to pay Employee a
salary at a rate of $90,000 per year form the date hereof through
December 31, 1999, and at a rate of $92,700 from January 1, 2000
through the date of termination of this agreement, increased from
time to time as the President in his sole discretion, determines
(the "Salary"). Such Salary will be paid no less often than semi-
monthly in accordance with the standard payroll practices of the
Company.

(b) Bonuses.

(1) Signing Bonus. Upon execution of this
Agreement, Employee will receive 5,000 shares of the common stock
of Holdings, $0.10 par value (the "Common Stock") as a signing
bonus.

(2) Sales Performance Bonus. In addition to
Salary and the Signing Bonus, Employee will be eligible for a
Sales performance bonus (the "Sales Bonus") consisting of 1.2%
commission on all sales, except sales by Gary Stinar and Walt
Haussner.

(3) Bonuses. For purposes of this agreement, the
term "Bonuses" means the Signing bonus and the Sales Bonus, if
any.

(1) Annual Grant. On each of the first and
second anniversary dates of this Agreement, so long as Employee
is not in breach of any provision of this Agreement and has
remained fully employed by the Company at all times during such
years, Employee will receive an incentive stock option (the
"Annual Option")under the Plan to purchase 5,000 shares of Common
Stock.

(2) Discretionary Annual Grant. In addition to
the Performance Option and the Annual Option, the President of
the company may, in his sole discretion, authorize the grant to
Employee of incentive stock options under the Plan to purchase up
to 10,000 shares of Common Stock per year, or authorize the
payment of an annual cash discretionary bonus of up to $20,000,
or a combination thereof.

(d) Miscellaneous Provisions Regarding Stock Options.

(1) Stock Option Agreement; Exercise Price and
Vesting. All options granted hereunder shall be made pursuant to
an Incentive Stock Option Agreement in substantially the form of
Exhibit A attached hereto. All such options will have an
exercise price equal to 100% of the fair market value per share
and will exercisable upon issuance by Holdings.

(2) The Plan. All options granted hereunder
shall be issued pursuant to and governed by the terms of the
Plan, and in the event of a conflict between the terms of the
Plan and this Agreement, the terms of the Plan will govern.

(e) Reimbursement of Business Expenses. The Company
agrees to reimburse the Employee for all reasonable out-of-
pocket business expenses incurred by the Employee on behalf of
the Company, provided that the Employee properly accounts to the
Company for all such expenses in accordance with the rules and
regulations of the Internal Revenue Service under the Internal
Revenue Code of 1986, as amended (the "Code") and in accordance
with the standard policies of the Company relating to
reimbursement of business expenses. To the extent any single
expense exceeds $1,000, the Employee shall obtain prior approval
of such expense from the president of the Company.

(f) Benefits and Vacation. The Employee is entitled
to participate in all benefit plans adopted by the Company to the
extent that the terms of such benefit plans permit the Employee
to participate. The Employee is entitled to four (4) weeks, paid
vacation and all legal holidays observed by the Company, in each
case, in accordance with the Company's policies as in effect from
time-to-time.

3. Term and Termination.

(a) Term. Subject to earlier termination in
accordance with Section 3(b) below, this Agreement will become
effective on the date set forth above and will have an initial
term of two (2) years.

(b) Termination. Subject to the respective continuing
obligations of the Company and the Employee under Sections 4, 5
and 6:
(1) The Company may terminate this Agreement
immediately on written notice to the Employee for cause,
including (without limitation) (i) dishonesty, fraud, material
and deliberate injury or attempted injury, in each case related
to the Company or its business, (ii) any unlawful or criminal
activity of a serious nature, (iii) any willful breach of duty or
habitual neglect of duty or (iv) any breach of Sections 4, 5 or 6
of this Agreement;

(2) This Agreement will terminate upon Employee's
death or upon written notice from the Company in the event of
Employee's "permanent disability" (the term "permanent
disability" means the occurrence of an event which constitutes
permanent and total disability within the meaning of Section
22(e)(3) of the Code);

(3) This Agreement will terminate upon a change
in control. For purposes of this Agreement, a "Change in
Control" means (i) the sale, lease, exchange or other transfer of
all or substantially all of the assets of Holdings to a
corporation, person or other entity that is not controlled by
Holdings; (ii) the approval by the shareholders of Holdings any
plan or proposal for the liquidation or dissolution of Holdings;
(iii) a merger or consolidation to which Holdings is a party if
the shareholders of Holdings immediately prior to the effective
date of such merger or consolidation have "beneficial ownership"
(as defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), immediately following the
effective date of such merger consolidation, of securities of the
surviving corporation representing (A) 50% or more, but not more
than 80%, of the combined voting power of the surviving
corporation's then outstanding securities ordinarily having the
right to vote at elections of directors, unless such merger or
consolidation has been approved in advance by the Board, or (B)
less than 50% of the combined voting power of the surviving
corporation's then outstanding securities ordinarily having the
right to vote at elections of directors (regardless of any
approval by the Board of Directors of Holdings); (iv) any person
becomes, after the date hereof, the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of (A) 20% or more, but not 50% or more, of the
combined voting power of the outstanding securities of Holdings
ordinarily having the right to vote at elections of directors,
unless the transaction resulting in such ownership has been
approved in advance by the Board of Directors of Holdings, or (B)
more than 50% of the combined voting power of the outstanding
securities of Holdings ordinarily having the right to vote at
elections of directors (regardless of any approval by the Board);
or (v)a change in control of Holdings of a nature that would be
required to be reported pursuant to Section 13 or 15 (d) of the
Exchange Act, whether or not Holdings is then subject to such
reporting requirements.

The date this Agreement is terminated is hereinafter referred to
as the Termination Date."

(c) Compensation Upon Termination. If the Company
terminates this Agreement pursuant to paragraph (1) of Section
3(b), the Company will be obligated to pay the Employee only the
Salary as may be due and owing through the Termination Date and
all other non-contingent compensation earned and accrued up
through the Termination Date which will specifically not include
any Bonus payments. Such Salary will be paid in one lump sum
within ten business days of the Termination Date. If this
Agreement terminates pursuant to paragraphs (2) or (3) of Section
3(b), the Company will be obligated to pay the Employee (i) an
amount equal to the Employee's Salary for a period of six (6)
months at the rate in effect on the date of termination; and (ii)
all other non-contingent compensation earned and accrued up
through the Termination Date, including any Bonus payments. Such
Salary and non-contingent compensation will be paid in one lump
sum within ten business days of the date of termination.

4. Confidentiality.

(a) Prohibition on Use of Confidential Information.
The Employee agrees not to directly or indirectly disclose or use
at any time, either during or subsequent to his employment by the
Company and any of its subsidiaries or affiliates (which
obligation will survive indefinitely), any technology, trade
secrets, know-how, or other information, knowledge, or data
possessed or used by the Company or Holdings or to which the
Employee gains access in connection with his employment and which
the Company or Holdings deems confidential or proprietary or
which the Employee has reason to believe is confidential or
proprietary, except as such disclosure or use may be required in
connection with his work for the Company or unless the Employee
first secures the written consent of the Company and Holdings.
Upon termination of his employment, the Employee will promptly
return to the Company all originals and all copies of all
property and assets of the Company or Holdings created or
obtained by the Employee as a result of or in the course of or in
connection with his employment with the Company which are in the
Employee's possession or control, whether confidential or not,
including, but not limited to, computer files, software programs,
computer equipment, correspondence, notes, memoranda, notebooks,
drawings, customer lists, or other documents delivered to the
Employee concerning any idea, product, apparatus, invention or
process manufactured, used, developed, investigated, or marketed
by the Company or Holdings during the period of his employment.

(b) Third-Party Information. The Employee understands
and acknowledges that the Company has a policy prohibiting the
receipt by the Company of any confidential information in breach
of the Employee's obligations to third parties and does not
desire to receive any confidential information under such
circumstances. Accordingly, the Employee will not disclose to
the Company or use in the performance of any duties for the
Company any confidential information in breach of an obligation
to any third party. The Employee represents that he has provided
the Company with a copy of any agreement by which the Employee is
bound that restrict the Employee'' use of any third party''
confidential information.

5. Inventions.

(a) Definition. "Inventions", as used in this
Agreement, means any inventions, discoveries, improvements and
ideas, whether or not in writing or reduced to practice and
whether or not patentable or copyrightable, made, authored or
conceived by the Employee, whether by the Employee's individual
efforts or in connection with the efforts of others, and that
either (i) related in any way to the Company's business, products
or processes, past, present, anticipated or under development, or
(ii) result in any way from the Employee's employment by the
Company, or (iii) use the Company's equipment, supplies,
facilities or trade secret information.

(b) Ownership of Inventions. The Employee agrees that
all Inventions made by the Employee during the period of the
Employee's employment with the Company and for eighteen (18)
months thereafter, whether made during the working hours of the
Company or on the Employee's own time, will be the sole and
exclusive property of the Company. The Employee will, with
respect to any Invention: (i) keep current, accurate, and
complete records, which will belong to the Company and be kept
and stored on the Company's premises; (ii) promptly and fully
disclose the existence and describe the nature of the Invention
to the Company in writing (and without request); (iii) assign
(and the Employee hereby assigns) to the Company all of the
Employee's right, title and interest in and to the Invention, any
applications the Employee makes for patents or copyrights in any
country, and any patents or copyrights granted to the Employee in
any country; and (iv) acknowledge and deliver promptly to the
Company any written instruments, and perform any other acts
necessary in the Company's opinion to preserve property rights in
the Invention against forfeiture, abandonment or loss and to
obtain and maintain letters patent and/or copyrights on the
Invention and to vest the entire right and title to the Invention
in the Company. The Employee agrees to perform promptly (without
charge to the Company but at the expense of the Company) all acts
as may be necessary in the Company's opinion to preserve all
patents and/or copyrights granted upon the Employee's Inventions
forfeiture, abandonment or loss.

The requirements of this Section 5(b) do not apply to any
Invention for which no equipment, supplies, facility or trade
secret information of the Company was used and which was
developed entirely on the Employee's own time, and (i) which does
not relate directly to the Company's business or to the Company's
actual or demonstrably anticipated research or development, or
(ii) which does not result from any work the Employee performed
for the Company. The Employee represents that, except as
disclosed below, as of the date of this Agreement, the Employee
has no rights under and will make no claims against the Company
with respect to, any inventions, discoveries, improvements, ideas
or works of authorship which would be Inventions if made,
conceived, authored or acquired by the Employee during the term
of this Agreement.

(c) Works Made for Hire. To the extent that any
Invention qualifies as "work made for hire" as defined in 17
U.S.C. & 101 (1976), as amended, such Invention will constitute
"work made for hire" and, as such, will be the exclusive property
of the Company.

(d) Presumption. In the event of any dispute,
arbitration or litigation concerning whether an invention,
improvement or discovery made or conceived by the Employee is the
property of the Company, such invention, improvement or discovery
will be presumed the property of the Company and the Employee
will bear the burden of establishing otherwise.

(e) Survivability. The obligations of this Section 5
will survive the expiration or termination of this Agreement.

6. Non-Competition Agreement.

(a) Other Agreements. The Employee represents and
warrants to the Company that he is not currently subject to a
non-competition, confidentiality or other such agreement with a
former employer which prohibits the Employee from working for the
Company.

(b) Definition. "Company Product" means any actual or
projected product, product line or service that has been
designed, developed, manufactured, marketed or sold by the
Company during the Employee's employment with the Company or
regarding which the Company has conducted or acquired research
and development during the Employee's employment with the
Company.

(c) Non-Compete. The Employee agrees that, during his
employment with the Company and for a period of two (2) years
after employment with the Company ends, the Employee will not
alone, or in any capacity with another firm, within any
geographical area in which the Company, at the termination of the
Employee's employment with the Company, was engaged in more than
an insignificant volume of business:

(1) directly or indirectly participate in or
support in any capacity (e.g., as an advisor, principal, agent,
partner, officer, director, shareholder, employee or otherwise)
the manufacture, invention, development, sale, solicitation of
sale, marketing, testing, research or other business aspect of
any actual or projected product, product line or service
designed, developed, manufactured, marketed or sold by anyone
other than the Company that performs similar functions or is used
for the same general purposes as a Company Product; (2) call
upon, solicit, contact or serve any of the then-existing clients,
customers, vendors or suppliers, of the Company, any clients,
customers, vendors or suppliers that have had a relationship with
the Company during the preceding twelve (12) months, or any
potential clients, customers, vendors or suppliers that were
solicited by the Company during the preceding twelve (12) months;

(3) disrupt, damage, impair, or interfere with
the business of the Company whether by way of interfering with or
disrupting the Company's relationship with employees, customers,
agents, representatives or vendors; or

(4) employ or attempt to employ (by soliciting
or assisting anyone else in the solicitation of) any of the
Company's then employees on behalf of any other entity, whether
or not such entity competes with the Company.

(d) Exceptions to Non-Compete. The
restrictions contained in Section 6(c) of this Agreement will not
prevent the Employee from accepting employment with a large
diversified organization with separate and distinct divisions
that do not compete, directly or indirectly, with the Company, as
long as prior to accepting such employment the Company receives
separate written assurances from the prospective employer and
from the Employee, satisfactory to the Company, to the effect
that the Employee will not render any services, directly or
indirectly, to any division or business unit that competes,
directly or indirectly, with the Company. During the restrictive
period set forth in Section 6(c), the Employee will inform any
new employer, prior to accepting employment, of the existence of
this Agreement and provide such employer with a copy of this
Agreement.

(e) Cessation of Business. Section 6(c) of
this Agreement will cease to be applicable to any activity of the
Employee from and after such time as the Company (i) has ceased
all business activities for a period of six (6) months or (ii)
has made a decision through its Board of Directors not to
continue, or has ceased for a period of six (6) months, the
business activities with which such activity of the Employee
would be competitive.

(f) No Additional Compensations. In the
event that the Employee's employment terminates for any reason,
no additional compensation will be paid for this non-competition
obligation.

(g) Survival. The obligations of this
Section 6 will survive the expiration or termination of this
Agreement

7. Miscellaneous.

(a) No Adequate Remedy. The Employee understands
that if the Employee fails to fulfill Employee's obligations
under Sections 4, 5 and 6 of this Agreement, the damages to the
Company would be very difficult to determine. Therefore, in
addition to any rights or remedies available to the Company at
law, in equity, or by statute, the Employee hereby consents to
the specific enforcement of Sections 4, 5 and 6 of this Agreement
by the Company through an injunction or restraining order issued
by an appropriate court.

(b) Consent to Use of Name. The Employee
consents to the use of Employee's name in appropriate Company
materials such as, but not limited to, offering memoranda related
to financing activities of the Company.

(c) No Conflicts. The Employee represents and
warrants to the Company that neither the entering into of this
Agreement nor the performance of any obligations hereunder will
conflict with or constitute a breach under any obligation of the
Employee, as the case may be, under any agreement or contract to
which the Employee is a party or any other obligation by which
the Employee is bound. Without limiting the foregoing, the
Employee agrees that at no time will the Employee use any trade
secrets or other intellectual property of any third party while
performing services hereunder.

(d) Successors and Assigns. This Agreement is
binding on and inures to the benefit of the Company's successors
and assigns; provided however, that the Company may assign the
Agreement only connection with a merger, consolidation,
assignment, sale or other disposition or substantially all of its
assets or business. This Agreement is also binding on the
Employee's heirs, successors, assigns and legal representatives.

(e) Modification. This Agreement may be modified
or amended only by a writing signed by the Company and the
Employee.

(f) Governing Law. The laws of Minnesota will
govern the validity, construction, and performance of this
Agreement. Any legal proceeding related to this Agreement will
be brought in an appropriate Minnesota court, and the Company and
the Employee hereby consent to the exclusive jurisdiction of that
court for this purpose.

(g) Dispute Resolution. Except for any
proceeding brought pursuant to Section 7(a) herein, the parties
agree that any dispute arising out of or relating to this
Agreement or the formation, branch, termination or validity
thereof (a "Dispute"), will be resolved as follows. If the
Dispute cannot be settled through direct discussions, the parties
will first try to settle the Dispute in an amicable manner by
mediation under the Commercial Mediation Rules of the American
Arbitration Association, before resorting to arbitration. Any
Dispute that has not been resolved within sixty(60) days of the
initiation of the mediation procedure (the "Mediation Deadline")
will be settled by binding arbitration by a panel of three
arbitrators in accordance with the commercial arbitration rules
of the American Arbitration Association. The arbitration and
mediation proceedings will be located in Minneapolis, Minnesota.
The arbitrators are not empowered to award damages in excess of
compensatory damages and each party hereby irrevocably wives any
damage in excess of compensatory damages. Judgment upon any
arbitration award may be entered into any court having
jurisdiction thereof and the parties' consent to the jurisdiction
of the courts the state in which the arbitration occurred for
this purpose.

(h) Construction. Whenever possible, each
provision of this Agreement will be interpreted so that it is
valid under the applicable law. If any provision of this
Agreement is to any extent declared invalid by a court of
competent jurisdiction under the applicable law, that provision
will remain effective to the extent not declared invalid. The
remainder of this Agreement also will continue to be valid, and
the entire Agreement will continue to be valid in other
jurisdictions.

(i) Waivers. No failure or delay by the Company
or the Employee in exercising any right or remedy under this
Agreement will waive any provision of the Agreement. Nor will
any single or partial exercise by either the Company or the
Employee of any right or remedy under this Agreement preclude
either of them from otherwise or further exercising these rights
or remedies, or any other rights or remedies granted by any law
or any related document.

(j) Entire Agreement. This Agreement supersedes
all previous and contemporaneous oral negotiations, commitments,
writings and understandings between the parties concerning the
matters in this Agreement, including without limitation any
policy or personnel manuals of the Company.

(k) Notices. All notices and other
communications required or permitted under this Agreement will be
in writing and sent by registered first-class mail, postage
prepaid, and will be effective five days after mailing to the
addresses stated at the beginning of this Agreement. These
addresses may be changed at any time by like notice.

IN WITNESS WHEREOF, the Company and the Employee have executed
this Agreement as of the date first above written.

STINAR CORPORATION

By:/S/ Robert C. Harvey
Robert C. Harvey, President

EMPLOYEE

By:/S/ Robert Gregor
Robert Gregor

RESOLUTIONS OF THE BOARD OF DIRECTORS OF OAKRIDGE HOLDINGS, INC.

RESOLVED, that the Oakridge Holdings, Inc. 1999 Stock Incentive
Awards Plan (the "Awards Plan") is hereby approved and adopted in
the form attached hereto as Exhibit A, with such changes as
appropriate officers of the Company may deem necessary or
appropriate.

RESOLVED FURTHER, that any and all actions performed on behalf of
the Company by all appropriate officers of the Company through
the date hereof, pursuant to the transactions contemplated by the
foregoing resolution, are hereby ratified, confirmed, adopted and
endorsed in all respects.

RESOLVED FURTHER, that the appropriate officers of the Company,
and each of them, are authorized and directed to make, execute,
acknowledge, deliver and perform in the name of, and on behalf
of, the Company any other instruments, documents or certificates,
or to take or cause to be taken such actions, which may be deemed
by such officers, or any of them, to be necessary or advisable to
consummate the transactions contemplated by the foregoing
resolutions, all of which may contain such clauses, terms,
provisions and conditions as the officer or officers who execute
the same shall deem necessary or advisable.

/S/ Robert B. Gregor
Robert B. Gregor
Secretary to the Board of Directors

/S/ Robert C. Harvey
Robert C. Harvey
Chairman

OAKRIDGE HOLDINGS, INC.
1999 STOCK INCENTIVE AWARDS PLAN

1. PURPOSE OF PLAN. The Purpose of the Oakridge Holdings,
Inc. 1999 Stock Incentive Awards Plan (the "Plan") is to advance
the interests of Oakridge Holdings, Inc. (the "Company") and its
shareholders by enabling the Company and its Subsidiaries to
attract and retain persons of ability to perform services for the
Company and its Subsidiaries by providing an incentive to such
individuals through equity participation in the Company and by
rewarding such individuals who contribute to the achievement by
the Company of its economic objectives.

2. DEFINITIONS. The following terms will have the
meanings set forth below, unless the context clearly otherwise
requires:

(a) "BOARD" means the Board of Directors of the Company.

(b) "BROKER EXERCISE NOTICE" means a written notice
pursuant to which a Participant, upon exercise of any
Option, irrevocably instructs a broker or dealer to sell a
sufficient number of shares or loan a sufficient amount of
money to pay all or a portion of the exercise price of the
Option and/or any related withholding tax obligations and
remit such sums to the Company and directs the Company to
deliver stock certificates to be issued upon such exercise
directly to such broker or dealer.

(d) "CODE" means the Internal Revenue Code of 1986, as
amended.

(e) "COMMITTEE" means the group of individuals
administering the Plan, as provided in Section 3 of the
Plan.

(f) "COMMON STOCK" means the common stock of the Company,
par value $___ per share, or the number and kind of shares
of stock or other securities into which such Common Stock
may be changed in accordance with Section 4(c) of the Plan.

(g) "DISABILITY" means the disability of the Participant
such as would entitle the Participant to receive disability
income benefits pursuant to the long-term disability plan of
the Company or Subsidiary then covering the Participant or,
if no such plan exists or is applicable to the Participant,
the permanent and total disability of the Participant within
the meaning of Section 22(e)(3) of the Code.

(h) "ELIGIBLE RECIPIENTS" means all employees of the
Company or any Subsidiary and any non-employee directors,
consultants and independent contractors of the Company or
any Subsidiary.

(i) "EXCHANGE ACT" means the Securities Exchange Act of
1934, as amended.

(j) "FAIR MARKET VALUE" means, with respect to the Common
Stock, the following:

(i) if the Common Stock is listed or admitted to
unlisted trading privileges on any national securities
exchange or is not so listed or admitted but
transactions in the Common Stock are reported on the
Nasdaq National Market, the closing price of the Common
Stock on such exchange or reported by the nasdaq
National Market as of such date (or, if no shares were
traded on such day, as of the next preceding day on
which there was such a trade).

(ii) if the Common Stock is not so listed or
admitted to unlisted trading privileges or reported on
the Nasdaq National Market, and bid and asked prices
therefor in the over-the-counter market are reported by
the Nasdaq SmallCap Market or the National Quotation
Bureau, Inc. (or any comparable reporting service), the
mean of the closing bid and asked prices as of such
date, as so reported by the nasdaq SmallCap Market, or,
if not so reported thereon, as reported by the National
Quotation Bureau, Inc. (or such comparable reporting
service).

(iii) if the Common Stock is not so listed or
admitted to unlisted trading privileges, or reported on
the Nasdaq National Market, and such bid and asked
prices are not so reported, such price as the Committee
determines in good faith in the exercise of its
reasonable discretion. The Committee shall not be
required to obtain an appraisal within six months of
the adoption of the Plan. The Committee's
determination as to the current value of the Common
Stock shall be final, conclusive and binding for all
purposes and on all persons, including, without
limitation, the Company, the shareholders of the
Company, the Participants and their respective
successors-in-interest. No member of the Board of the
Committee shall be liable for any determination
regarding current value of the Common Stock that is
made in good faith.

(k) "INCENTIVE AWARD" means an Option, Restricted Stock
Award, Performance Unit or Stock Bonus granted to an
Eligible Recipient pursuant to the Plan.

(l) "INCENTIVE STOCK OPTION" means a right to purchase
Common Stock granted to an Eligible Recipient pursuant to
Section 6 of the Plan that qualifies as an "incentive stock
option" within the meaning of Section 422 of the Code.

(m) "NON-STATUTORY STOCK OPTION" means a right to purchase
Common Stock granted to an Eligible Recipient pursuant to
Section 6 of the Plan that does not qualify as an Incentive
Stock Option.

(n) "OPTION" means an Incentive Stock Option or a Non-
Statutory Stock Option.

(o) "PARTICIPANT" means an Eligible Recipient who receives
one or more Incentive Awards under the Plan.

(p) "PERFORMANCE UNIT" means a right granted to an Eligible
Recipient pursuant to Section 8 of the Plan to receive a
payment from the Company, in the form of stock, cash or a
combination of both, upon the achievement of established
performance or other goals.

(q) "PREVIOUSLY ACQUIRED SHARES" means shares of Common
Stock that are already owned by the Participant or, with
respect to any Incentive Award, that are to be issued upon
the grant, exercise or vesting of such Incentive Award.

(r) "RESTRICTED STOCK AWARD" means an award of Common Stock
granted to an Eligible Recipient pursuant to Section 7
of the Plan that is subject to the restrictions on
transferability and the risk of forfeiture imposed by
the provisions of such Section 7.

(s) "RETIREMENT" means termination of employment or service
pursuant to and in accordance with the regular (or, if
approved by the Board for purposes of the Plan, early)
retirement/pension plan or practice of the Company or
Subsidiary then covering the Participant, provided that if
the Participant is not covered by any such plan or practice,
the Participant will be deemed to be covered by the
Company's plan or practice for purposes of this
determination.

(t) "SECURITIES ACT" means the Securities Act of 1933, as
amended.

(u) "STOCK BONUS" means an award of Common Stock granted to
an Eligible Recipient pursuant to Section 9 of the Plan.

(v) "SUBSIDIARY" means any entity that is directly or
indirectly controlled by the Company or any entity in which
the Company has significant equity interest, as determined
by the Committee.

(w) "TAX DATE" means the date any withholding tax
obligation arises under the Code for a Participant with
respect to an Incentive Award.

3. PLAN ADMINISTRATION.

(a) THE COMMITTEE. The Plan will be administered by the
Board or by a committee of the Board consisting of not less
than two persons (the "Committee"). To the extent
consistent with corporate law, the Committee may delegate to
any officers of the Company the duties, power and authority
of the Committee under the Plan pursuant to such conditions
or limitations as the Committee may establish. Each
determination, interpretation or other action made or taken
by the Committee pursuant to the provisions of the Plan will
be conclusive and binding for all purposes and on all
persons, and no member of the Committee will be liable for
any action or determination made in good faith with respect
to the Plan or any Incentive Award granted under the plan.
The Plan may be administered by a committee consisting
solely of not less than two members of the Board who are
"non-employee directors" within the meaning of Rule 16b-3
under the Exchange Act, and upon establishment of such a
committee, only the Committee so comprised may exercise such
duties, power and authority with respect to Eligible
Recipients who are subject to Section 16 of the Exchange
Act.

(b) AUTHORITY OF THE COMMITTEE.

(i) In accordance with the subject to the
provisions of the Plan, the Committee will have the
authority to determine all provisions of Incentive
Awards as the Committee may deem necessary or desirable
and as consistent with the terms of the Plan,
including, without limitation, the following: (A) the
Eligible Recipients to be selected as Participants; (B)
the nature and extent of the Incentive Awards to be
made to each Participant (including the number of
shares of Common Stock to be subject to each Incentive
Award, any exercise price, the manner in which
Incentive Awards will vest or become exercisable and
whether Incentive Awards will be granted in tandem with
other Incentive Awards) and the form of written
agreement, if any, evidencing such Incentive Award; (C)
the time or times when Incentive Awards will be
granted; (D) the duration of each Incentive Award; and
(E) the restrictions and other conditions to which the
payment or vesting of Incentive Awards may be subject.
In addition, the Committee will have the authority
under the Plan in its sole discretion to pay the
economic value of any Incentive Award in the form of
cash, Common Stock or any combination of both.

(ii) The Committee will have the authority under
the plan to amend or modify the terms of any
outstanding Incentive Award in any manner, including,
without limitation, the authority to modify the number
of shares or other terms and conditions of an Incentive
Award, extend the term of an Incentive Award,
accelerate the exercisability of vesting or otherwise
terminate any restrictions relating to an Incentive
Award, accept the surrender of any outstanding
Incentive Award or, to the extent not previously
exercised or vested, authorize the grant of new
Incentive Awards in substitution for surrendered
Incentive Awards; provided, new Incentive Awards in
substitution for surrendered Incentive Awards;
provided, however that the amended or modified terms
are permitted by the Plan as then in effect and that
any Participant adversely affected by such amended or
modified terms has consented to such amendment or
modification. No amendment or modification to an
Incentive Award, however, whether pursuant to this
Section 3(b) or any other provisions of the Plan, will
be deemed to be a regrant of such Incentive Award for
purposes of this Plan.

(iii) In the event of (A) any reorganization,
merger, consolidation, recapitalization, liquidation,
reclassification, stock dividend, stock split,
combination of shares, rights offering, extraordinary
dividend or divestiture (including a spin-off) or any
other change in corporate structure or shares, (B) any
purchase, acquisition, sale or disposition of a
significant amount of assets or a significant business,
(C) any change in accounting principles or practices,
or (D) any other similar change, in each case with
respect to the Company or any other entity whose
performance is relevant to the grant or vesting of an
Incentive Award, the Committee (or, if the Company is
not the surviving corporation in any such transaction,
the board of directors of the surviving corporation)
may, without the consent of any affected Participant,
amend or modify the vesting criteria of any outstanding
Incentive Award that is based in whole or in part on
the financial performance of the Company (or any
Subsidiary or division thereof) or such other entity so
as equitably to reflect such event, with the desired
result that the criteria for evaluating such financial
performance of the Company or such other entity will be
substantially the same (in the sole discretion of the
Committee or the board of directors of the surviving
corporation) following such event as prior to such
event; provided, however, that the amended or modified
terms are permitted by the Plan as then in effect.

4. SHARES AVAILABLE FOR ISSUANCE.

(a) MAXIMUM NUMBER OF SHARES AVAILABLE. Subject to
adjustment as provided in Section 4(c) of the Plan, the
maximum number of shares of Common Stock that will be
available for issuance under the Plan and reserved out of
the authorized but unissued shares will be 175,000 shares.

(b) ACCOUNTING FOR INCENTIVE AWARDS. Shares of Common
Stock that are issued under the Plan or that are subject to
outstanding Incentive Awards will be applied to reduce the
maximum number of shares of Common Stock remaining available
for issuance under the Plan. Any shares of Common Stock
that are subject to an Incentive Award that lapses, expires,
is forfeited or for any reason is terminated unexercised or
unvested and any shares of Common Stock that are subject to
an Incentive Award that is settled or paid in cash or any
form other than shares of Common Stock will automatically
again become available for issuance under the Plan. Any
shares of Common Stock that constitute the forfeited portion
of a Restricted Stock Award, however, will not become
available for further issuance under the Plan.

(c) ADJUSTMENTS TO SHARES AND INCENTIVE AWARDS. In the
event of any reorganization, merger, consolidation,
recapitalization, liquidation, reclassification, stock
dividend, stock split, combination of shares, rights
offering, divestiture or extraordinary dividend (including a
spin-off) or any other change in the corporate structure or
shares of the Company, the Committee (or, if the Company is
not the surviving corporation in any such transaction, the
board of directors of the surviving corporation) will make
appropriate adjustment (which determination will be
conclusive) as to the number and kind of securities
available for issuance under the Plan and, in order to
prevent dilution or enlargement of the rights of
Participants, the number, kind and, where applicable,
exercise price of securities subject to outstanding
Incentive Awards.

5. PARTICIPATION. Participants in the Plan will be those
Eligible Recipients who, in the judgment of the Committee, have
contributed, are contributing or are expected to contribute to
the achievement of economic objectives of the Company or its
Subsidiaries. Eligible Recipients may be granted from time to
time one or more Incentive Awards, singly or in combination or in
tandem with other Incentive Awards, as may be determined by the
Committee in its sole discretion. Incentive Awards will be
deemed to be granted as of the date specified in the grant
resolution of the Committee, which date will be the date of any
related agreement with the Participant. The Company and the
participant will enter into a written agreement to reflect the
Incentive Awards.

6. OPTIONS.

(a) GRANT. An Eligible Recipient may be granted one or
more Options under the Plan, and such Options will be
subject to such terms and conditions, consistent with the
other provisions of the Plan, as may be determined by the
Committee in its sole discretion. The Committee may
designate whether an Option is to be considered an Incentive
Stock Option or a Non-Statutory Stock Option. To the extent
that any Incentive Stock Option granted under the Plan
ceases for any reason to qualify as an "incentive stock
option" for purposes of Section 422 of the Code, such
Incentive Stock Option will continue to be outstanding for
purposes of the Plan but will thereafter be deemed to be a
Non-Statutory Stock Option.

(b) EXERCISE PRICE. The per share price to be paid by a
Participant upon exercise of an Option will be determined by
the Committee in its discretion at the time of Option grant,
provided that (i) such price will not be less than 100% of
the Fair Market Value of one share of Common Stock on the
date of grant with respect to an Incentive Stock Option
(110% of the Fair Market Value if, at the time the Incentive
Stock Option is granted, the Participant owns, directly or
indirectly, more than 10% of the total combined voting power
of all classes of stock of the Company or any parent or
subsidiary corporation of the Company), and (ii) such price
will not be less than 85% of the Fair Market Value of one
share of Common Stock on the date of grant with respect to a
Non-Statutory Stock Option.

(c) EXERCISABILITY AND DURATION. An Option will become
exercisable at such times and in such installments as may be
determined by the Committee in its sole discretion at the
time of grant; provided, however, that no Option may be
exercisable after 10 years from its date of grant.

(d) PAYMENT OF EXERCISE PRICE. The total purchase price of
the shares to be purchased upon exercise of an Option will
be paid entirely in cash (including check, bank draft or
money order); provided, however, that the Committee, in its
sole discretion and upon terms and conditions established by
the Committee, may allow such payments to be made, in whole
or in part, by tender of a Broker Exercise Notice,
Previously Acquired Shares, a promissory note (on terms
acceptable to the Committee in its sole discretion) or by a
combination of such methods.

(e) MANNER OF EXERCISE. An Option may be exercised by a
Participant in whole or in part from time to time, subject
to the conditions contained in the Plan and in the agreement
evidencing such Option, by delivery in person, by facsimile
or electronic transmission or through the mail of written
notice of exercise to the Company (Attention: Secretary) at
its principal executive office in Eagan, Minnesota and by
paying in full the total exercise price for the shares of
Common Stock to be purchased in accordance with Section 6(d)
of the Plan.

7. RESTRICTED STOCK AWARDS.

(a) GRANT. An Eligible Recipient may be granted one or
more Restricted Stock Awards under the Plan, and such
Restricted Stock Awards will be subject to such terms and
conditions, consistent with the other provisions of the
Plan, as may be determined by the Committee in its sole
discretion. The committee may impose such restrictions or
conditions, not inconsistent with the provisions of the
Plan, to the vesting of such Restricted Stock Awards as it
deems appropriate, including, without limitation, that the
Participant remain in the continuous employ or service of
the Company or a Subsidiary for a certain period or that the
Participant or the Company (or any Subsidiary or division
thereof) satisfy certain performance goals or criteria.

(b) RIGHTS AS A SHAREHOLDER; TRANSFERABILITY. Except as
provided in Sections 7(a), 7(c) and 13(c) of the Plan, a
Participant will have all voting, dividend, liquidation and
other rights with respect to shares of Common Stock issued
to the Participant as a Restricted Stock Award under this
Section 7 upon the Participant becoming the holder of record
of such shares as if such Participant were a holder of
record of shares of unrestricted Common Stock.

(c) DIVIDENDS AND DISTRIBUTIONS. Unless the Committee
determines otherwise in its sole discretion (either in the
agreement evidencing the Restricted Stock Award at the time
of grant or at any time after the grant of the Restricted
Stock Award), any dividends or distributions (including
regular quarterly cash dividends) paid with respect to
shares of Common Stock subject to the unvested portion of a
Restricted Stock Award will be subject to the same
restrictions as the shares to which such dividends or
distributions relate. In the event the Committee determines
not to pay such dividends or distributions currently, the
Committee will determine in its sole discretion whether any
interest will be paid on such dividends or distributions.
In addition, the Committee in its sole discretion may
require such dividends and distributions to be reinvested
(and in such case the Participants consent to such
reinvestment) in shares of Common Stock that will be subject
to the same restrictions as the shares to which such
dividends or distributions relate.

(d) ENFORCEMENT OF RESTRICTIONS. To enforce the
restrictions referred to in this Section 7, the Committee
may place a legend on the stock certificates referring to
such restrictions and may require the Participant, until the
restrictions have lapsed, to keep the stock certificates,
together with duly endorsed stock powers, in the custody of
the Company or its transfer agent or to maintain evidence of
stock ownership, together with duly endorsed stock powers,
in a certificateless book-entry stock account with the
Company's transfer agent.

8. PERFORMANCE UNITS. An Eligible Recipient may be
granted one or more Performance Units under the Plan, and such
Performance Units will be subject to such terms and conditions,
consistent with the other provisions of the Plan, as may be
determined by the Committee in its sole discretion. The
Committee may impose such restrictions or conditions, not
inconsistent with the provisions of the Plan, to the vesting of
such Performance Units as it deems appropriate, including,
without limitation, that the Participant remain in the continuous
employ or service of the Company or any Subsidiary for a certain
period or that the Participant or the Company (or any Subsidiary
or division thereof) satisfy certain performance goals or
criteria. The Committee will have the sole discretion either to
determine the form in which payment of the economic value of
vested Performance units will be made to the Participant (i.e.,
cash, Common Stock or any combination thereof) or to consent to
or disapprove the election by the Participant of the form of such
payment.

9. STOCK BONUSES. An Eligible Recipient may be granted
one or more Stock Bonuses under the Plan, and such Stock Bonuses
will be subject to such terms and conditions, consistent with the
other provisions of the Plan, as may be determined by the
Committee. The Participant will have all voting, dividend,
liquidation and other rights with respect to the shares of Common
Stock issued to a Participant as a Stock Bonus under this Section
9 upon the Participant becoming the holder of record of such
shares; provided, however, that the Committee may impose such
restrictions on the assignment or transfer of a Stock Bonus as it
deems appropriate.

10. EFFECT OF TERMINATION OF EMPLOYMENT OR OTHER SERVICE.

(a) TERMINATION DUE TO DEATH, DISABILITY OR RETIREMENT. In
the event a Participant's employment or other service with
the Company and all Subsidiaries is terminated by reason of
death, Disability or Retirement:

(i) All outstanding options then held by the
Participant will become immediately exercisable in full
and will remain exercisable for a period of one year
(three months in the case of Retirement) after such
termination (but in no event after the expiration date
of any such Option);

(ii) All Restricted Stock Awards then held by the
Participant will become fully vested; and

(iii) All Performance Units and Stock Bonuses then
held by the Participant will vest and/or continue to
vest in the manner determined by the Committee and set
forth in the agreement evidencing such Performance
Units or Stock Bonuses.

(b) TERMINATION FOR REASONS OTHER THAN DEATH, DISABILITY OR
RETIREMENT.

(i) In the event a Participant's employment or
other service is terminated with the Company and all
Subsidiaries for any reason other than death,
Disability or Retirement, or a Participant is in the
employ or service of a Subsidiary and the Subsidiary
ceases to be a Subsidiary of the Company (unless the
Participant continues in the employ or service of the
Company or another Subsidiary), all rights of the
Participant under the Plan and any agreements
evidencing an Incentive Award will immediately
terminate without notice of any kind, and no Options
then held by the Participant will thereafter be
exercisable, all Restricted Stock Awards then held by
the Participant that have not vested will be terminated
and forfeited, and all Performance Units and Stock
Bonuses then held by the Participant will vest and/or
continue to vest in the manner determined by the
Committee and set forth in the agreement evidencing
such Performance Units or Stock Bonuses; provided,
however, that if such termination is due to any reason
other than termination by the Company or any Subsidiary
for "cause" all outstanding Options then held by such
Participant which are vested and exercisable at the
date of termination will remain exercisable for a
period of three months after such termination (but in
no event after the expiration date of any such Option).

(ii) For purposes of this Section 10(b), "cause"
(as determined by the Committee) will be as defined in
any employment or other agreement or policy applicable
to the Participant or, if no such agreement or policy
exists, will mean (A) dishonesty, fraud,
misrepresentation, embezzlement or deliberate injury or
attempted injury, in each case related to the Company
or any Subsidiary, (B) any unlawful or criminal
activity of a serious nature, (C) any intentional and
deliberate breach of a duty or duties that,
individually or in the aggregate, are material in
relation to the Participant's overall duties, or (D)
any material breach of any employment, service,
confidentiality or noncompete agreement entered into
with the Company or any Subsidiary.

(c) MODIFICATION OF RIGHTS UPON TERMINATION.
Notwithstanding the other provisions of this Section 10,
upon a Participant's termination of employment or other
service with the Company and all Subsidiaries, the Committee
may, in its sole discretion (which may be exercised at any
time on or after the date of grant, including following such
termination), cause Options (or any part thereof) then held
by such Participant to become or continue to become
exercisable and/or remain exercisable following such
termination of employment or service and Restricted Stock
Awards, Performance Units and Stock Bonuses then held by
such Participant to vest and/or continue to vest or become
free of transfer restrictions, as the case may be, following
such termination of employment or service, in each case in
the manner determined by the Committee; provided, however
that no Option may remain exercisable beyond its expiration
date.

(d) BREACH OF CONFIDENTIALITY OR NONCOMPETE AGREEMENTS.
Notwithstanding anything in the Plan to the contrary, in the
event that a Participant materially breaches the terms of
any confidentiality or noncompete agreement entered into
with the Company or any Subsidiary, whether such breach
occurs before or after termination of such Participant's
employment or other service with the Company or any
Subsidiary, the Committee in its sole discretion may
immediately terminate all rights of the Participant under
the Plan and any agreements evidencing an Incentive Award
then held by the Participant without notice of any kind.

(e) DATE OF TERMINATION OF EMPLOYMENT OR OTHER SERVICE.
Unless the Committee otherwise determines in its sole
discretion, a Participant's employment or other service
will, for purposes of the Plan, be deemed to have terminated
on the date recorded on the personnel or other records of
the Company or the Subsidiary for which the Participant
provides employment or other service, as determined by the
Committee in its sole discretion based upon such records.

11. PAYMENT OF WITHHOLDING TAXES.

(a) GENERAL RULES. The Company is entitled to (i) withhold
and deduct from future wages of the Participant (or from
other amounts that may be due and owing to the Participant
from the Company or a Subsidiary), or make other
arrangements for the collection of, all legally required
amounts necessary to satisfy any and all federal, state and
local withholding and employment-related tax requirements
attributable to an Incentive Award, including, without
limitation, the grant, exercise or vesting of, or payment of
dividends with respect to, an Incentive Award or a
disqualifying disposition of stock received upon exercise of
an Incentive Stock Option, or (ii) require the Participant
promptly to remit the amount of such withholding to the
Company before taking any action, including issuing any
shares of Common Stock, with respect to an Incentive Award.

(b) SPECIAL RULES. The Committee may, in its sole
discretion and upon terms and conditions established by the
Committee, permit or require a Participant to satisfy, in
whole or in part, any withholding or employment-related tax
obligation described in Section 11(a) of the Plan by
electing to tender Previously Acquired Shares, a Broker
Exercise Notice or a promissory note (on terms acceptable to
the Committee in its sole discretion), or by a combination
of such methods.

12. CHANGE IN CONTROL.

(a) CHANGE IN CONTROL. For purposes of this Section 12, a
"Change in Control" of the Company will mean the following:

(i) the sale, lease, exchange or other transfer,
directly or indirectly, of substantially all of the
assets of the Company (in one transaction or in a
series of related transactions) to a person or entity
that is not controlled by the Company,

(ii) the approval by the shareholders of the
Company of any plan or proposal for the liquidation or
dissolution of the Company;

(iii) a merger or consolidation to which the
Company is a party if the shareholders of the Company
immediately prior to effective date of such merger or
consolidation have "beneficial ownership" (as defined
in Rule 13d-3 under the Exchange Act), immediately
following the effective date of such merger or
consolidation, of securities of the surviving
corporation representing (A) more than 50%, but not
more than 80%, of the combined voting power of the
surviving corporation's then outstanding securities
ordinarily having the right to vote at elections of
directors, unless such merger or consolidation has been
approved in advance by the Incumbent Directors (as
defined in Section 12(b) below), or (B) 50% or less of
the combined voting power of the surviving
corporation's then outstanding securities ordinarily
having the right to vote at elections of directors
(regardless of any approval by the Incumbent
Directors);

(iv) any person becomes after the effective date
of the Plan the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly,
of (A) 20% or more, but not 50% or more, of the
combined voting power of the Company's outstanding
securities ordinarily having the right to vote at
elections of directors, unless the transaction
resulting in such ownership has been approved in
advance by the Incumbent Directors, or (B) 50% or more
of the combined voting power of the Company's
outstanding securities ordinarily having the right to
vote at elections of directors (regardless of any
approval by the Incumbent Directors);

(v) the Incumbent Directors cease for any reason
to constitute at least a majority of the Board; or

(vi) any other change in control of the Company of
a nature that would be required to be reported pursuant
to Section 13 or 15(d) of the Exchange Act, whether or
not the Company is then subject to such reporting
requirements.

(b) INCUMBENT DIRECTORS. For purposes of this Section 12,
"Incumbent Directors" of the Company will mean any
individuals who are members of the Board on the effective
date of the Plan and any individual who subsequently becomes
a member of the Board whose election, or nomination for
election by the Company's shareholders, was approved by a
vote of at least a majority of the Incumbent Directors
(either by specific vote or by approval of the Company's
proxy statement in which such individual is named as a
nominee for director without objection to such nomination).

(c) ACCELERATION OF VESTING. Without limiting the
authority of the Committee under Section 3(b) of the Plan,
if a Change in Control of the Company occurs, then, unless
otherwise provided by the Committee in its sole discretion
either in an agreement evidencing an Incentive Award at the
time of grant or at any time after the grant of an Incentive
Award, (i) all Options will become immediately exercisable
in full and will remain exercisable for the remainder of
their terms, regardless of whether the Participants to whom
such Options have been granted remain in the employ or
service of the Company or any Subsidiary; (ii) all
outstanding Restricted Stock Awards will become immediately
fully vested; and (iii) all Performance Units and Stock
Bonuses then held by the Participant will vest and/or
continue to vest in the manner determined by the Committee
and set forth in the agreement evidencing such Performance
Unit or Stock Bonuses.

(d) CASH PAYMENT FOR OPTIONS. If a Change in Control of
the Company occurs, then the Committee, if approved by the
Committee in its sole discretion either in an agreement
evidencing an Incentive award at the time of grant or at any
time after the grant of an Incentive Award, and without the
consent of any Participant effected thereby, may determine
that some or all Participants holding outstanding Options
will receive, with respect to some or all of the shares of
Common Stock subject to such Options, as of the effective
date of any such Change in Control of the Company, cash in
an amount equal to the excess of the Fair Market Value of
such shares immediately prior to the effective date of such
Change in Control of the Company over the exercise price per
share of such Options.

(e) LIMITATION ON CHANGE IN CONTROL PAYMENTS.
Notwithstanding anything in Section 12(c) or 12(d) of the
Plan to the contrary, if, with respect to a Participant, the
acceleration of the vesting of an Incentive Award as
provided in Section 12(c) or the payment of cash in exchange
for all or part of an Incentive Award as provided in Section
12(d) (which acceleration or payment could be deemed a
"payment" within the meaning of Section 280G(b)(2) of the
Code), together with any other "payments" which such
Participant has the right to receive from the Company or any
corporation that is a member of an "affiliated group" (as
defined in Section 1504(a) of the Code without regard to
Section 1504(b) of the Code) of which the Company is a
member, would constitute a "parachute payment" (as defined
in Section 280G(b)(2) of the Code), then the "payments" to
such Participant pursuant to Section 12(c) or 12(d) of the
Plan will be reduced to the largest amount as will result in
no portion of such "payments" being subject to the excise
tax imposed by Section 4999 of the Code; provided, however,
that if a Participant is subject to a separate agreement
with the Company or a Subsidiary that expressly addresses
the potential application of Sections 280G or 4999 of the
Code (including, without limitation, that "payments" under
such agreement or otherwise will not be reduced or that the
Participant will have the discretion to determine which
"payments" will be reduced), then the limitations of this
Section 12(e) will not apply, and any "payments" to a
Participant pursuant to Section 12(c) or 12(d) of the Plan
will be treated as "payments" arising under such separate
agreement.

13. RIGHTS OF ELIGIBLE RECIPIENTS AND PARTICIPANTS;
TRANSFERABILITY.

(a) EMPLOYMENT OR SERVICE. Nothing in the Plan will
interfere with or limit in any way the right of the Company
or any Subsidiary to terminate the employment or service of
any Eligible Recipient or Participant at any time, nor
confer upon any Eligible Recipient or Participant any right
to continue in the employ or service of the Company or any
Subsidiary.

(b) RIGHTS AS A SHAREHOLDER. As a holder of Incentive
Awards (other than Restricted Stock Awards and Stock
Bonuses), a Participant will have no rights as a shareholder
unless and until such Incentive Awards are exercised for, or
paid in the form of, shares of Common Stock and the
participant becomes the holder of record of such shares.
Except as otherwise provided in the Plan, no adjustment will
be made for dividends or distributions with respect to such
Incentive Awards as to which there is a record date
preceding the date the Participant becomes the holder of
record of such shares, except as the Committee may determine
in its discretion.

(c) RESTRICTIONS ON TRANSFER. Except pursuant to
testamentary will or the laws of descent and distribution or
as otherwise expressly permitted by the Plan, no right or
interest of any Participant in an Incentive Award prior to
the exercise or vesting of such Incentive Award will be
assignable or transferable, or subjected to any lien, during
the lifetime of the Participant, either voluntarily or
involuntarily, directly or indirectly, by operation of law
or otherwise. A Participant will, however, be entitled to
designate a beneficiary to receive an Incentive Award upon
such Participant's death, and in the event of a
Participant's death, payment of any amounts due under the
Plan will be made to, and exercise of any Options (to the
extent permitted pursuant to Section 10 of the Plan) may be
made by, the Participant's legal representatives, heirs and
legatees.

(d) NON-EXCLUSIVITY OF THE PLAN. Nothing contained in the
Plan is intended to modify or rescind any previously
approved compensation plans or programs of the Company or
create any limitations on the power or authority of the
Board to adopt such additional or other compensation
arrangements as the Board may deem necessary or desirable.

14. SECURITIES LAW AND OTHER RESTRICTIONS. Notwithstanding
any other provision of the Plan or any agreements entered into
pursuant to the Plan, the Company will not be required to issue
any shares of Common Stock under this Plan, and a Participant may
not sell, assign, transfer or otherwise dispose of shares of
Common Stock issued pursuant to Incentive Awards granted under
the Plan, unless (i) there is in effect with respect to such
shares a registration statement under the Securities Act and any
applicable state securities laws or an exemption from such
registration under the Securities Act and applicable state
securities laws, and (ii) there has been obtained any other
consent, approval or permit from any other regulatory body which
the Committee, in its sole discretion, deems necessary or
advisable. The Company may condition such issuance, sale or
transfer upon the receipt of any representations or agreements
from the parties involved, and the placement of any legends on
certificates representing shares of Common Stock, as may be
deemed necessary or advisable by the Company in order to comply
with such securities law or other restrictions.

15. PLAN AMENDMENT, MODIFICATION AND TERMINATION. The
Board may suspend or terminate the Plan or any portion thereof at
any time, and may amend the Plan from time to time in such
respects as the Board may deem advisable in order that Incentive
Awards under the Plan will conform to any change in applicable
laws or regulations or in any other respect the Board may deem to
be in the best interests of the Company; provided, however, that
no amendments to the Plan will be effective without approval of
the stockholders of the Company if stockholder approval of the
amendment is then required pursuant to Rule 16b-3 under the
Exchange Act, Section 422 of the Code or the rules of any stock
exchange or nasdaq. No termination, suspension or amendment of
the Plan may adversely affect any outstanding Incentive Award
without the consent of the affected Participant; provided,
however, that this sentence will not impair the right of the
Committee to take whatever action it deems appropriate under
Sections 4(c) and 12 of the Plan.

16. EFFECTIVE DATE AND DURATION OF THE PLAN. The Plan is
effective as of February 22, 1999, the date it was adopted by the
Board. The Plan will terminate at midnight on February 21, 2009,
and may be terminated prior to such time to by Board action, and
no Incentive Award will be granted after such termination.
Incentive Awards outstanding upon termination of the Plan may
continue to be exercised, or become free of restrictions, in
accordance with their terms.

17. MISCELLANEOUS.

(a) GOVERNING LAW. The validity, construction,
interpretation, administration and effect of the Plan and
any rules, regulations and actions relating to the Plan will
be governed by and construed exclusively in accordance with
the laws of the State of Minnesota.

(b) SUCCESSORS AND ASSIGNS. The Plan will be binding upon
and inure to the benefit of the successors and permitted
assigns of the Company and the Participants.

EXHIBIT 21

SUBSIDIARIES OF REGISTRANT

SUBSIDIARY STATE IN WHICH ORGANIZED

Lain and Son, Inc. Illinois

Glen Oak Cemetery Company Illinois
(a wholly owned subsidiary
of Lain and Son, Inc.)

Oakridge Cemetery (Hillside), Inc. Illinois
(a wholly owned subsidiary
of Lain and Son, Inc.)

Stinar Corporation Minnesota

<ARTICLE> 5

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