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PAGE 1
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 1996
OR
[ ] 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 1-44
ARCHER-DANIELS-MIDLAND COMPANY
(Exact name of registrant as specified in its charter)
Delaware 41-0129150
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
4666 Faries Parkway Box 1470 Decatur, Illinois 62525
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code217-424-5200
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
Common Stock, no par value New York Stock Exchange
Chicago Stock Exchange
Swiss Exchange
Tokyo Stock Exchange
Frankfurt Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes _X_ No ___
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
State the aggregate market value of the voting stock held by non-
affiliates of the registrant.
Common Stock, no par value--$8.7 billion
(Based on the closing price of the New York Stock Exchange on
August 19, 1996)
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest
practicable date.
Common Stock, no par value--518,975,939 shares
(August 19, 1996)
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the annual shareholders' report for the year ended
June 30, 1996 are incorporated by reference into Parts I, II and
IV.
Portions of the annual proxy statement for the year ended June
30, 1996 are incorporated by reference into Part III.
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PART I
Item 1. BUSINESS
(a) General Development of Business
Archer Daniels Midland Company was incorporated
in Delaware in 1923, successor to the Daniels
Linseed Co. founded in 1902.
During the last five years, the Company has
experienced significant growth, spending
approximately $3.3 billion for construction of new
plants, expansions of existing plants and the
acquisitions of plants and transportation equipment.
There have been no significant dispositions during
this period. However, during this period, the
Company has disposed of its Supreme Sugar subsidiary
and its British Arkady bakery ingredient business.
In addition, the Company has contributed its formula
feed operations, its rice milling operations, its
Mexican wheat flour mills and its masa corn flour
business to various unconsolidated joint ventures.
(b) Financial Information About Industry Segments
The Company is in one business segment--
procuring, transporting, storing, processing and
merchandising agricultural commodities and products.
(c) Narrative Description of Business
(i)Principal products
produced and principal markets for and methods of
distribution of such products.
The Company is engaged in the business of
procuring, transporting, storing, processing and
merchandising agricultural commodities and
products. It is one of the world's largest
processors of oilseeds, corn and wheat. The
Company also processes milo, oats, barley and
peanuts. Other operations include transporting,
merchandising and storing agricultural
commodities and products. These operations and
processes produce products which have primarily
two end uses: food or feed ingredients. Each
commodity processed is in itself a feed
ingredient as are the by-products produced during
the processing of each commodity.
Production processes of all commodities are
capital intensive and similar in nature. These
processes involve grinding, crushing or milling
with further value added through extraction,
refining and fermenting. Generally, each
commodity can be processed by any of these
methods to generate additional value added
products. All commodities and related processed
products share the same network of commodity
procurement facilities, transportation services
(including rail, barge, truck and ocean vessels)
and storage facilities.
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Item 1. BUSINESS--Continued
The geographic areas, customers and marketing
methods are basically the same for all
commodities and their related further processed
products. Feed ingredient products and by-
products are sold to farmers, feed dealers and
livestock producers, all of whom purchase
products from across the entire commodity chain.
Food ingredient products are also sold to one
basic group of customers: food and beverage
processors. Any single customer may purchase
products produced from all commodities, and any
single food or feed product could include
ingredients produced from all commodities
processed.
Oilseed Products
Soybeans, cottonseed, sunflower seeds, canola,
peanuts, flaxseed and corn germ are processed to
provide vegetable oils and meals principally for
the food and feed industries. Crude vegetable
oil is sold "as is" or is further processed by
refining and hydrogenating into margarine,
shortening, salad oils and other food products.
Partially refined oil is sold for use in
chemicals, paints and other industrial products.
Lecithin, an emulsifier produced in the vegetable
oil refining process, is marketed as a food and
feed ingredient. Natural source Vitamin E, an
antioxidant, and distilled monoglycerides, an
emulsifier, are produced from soybeans and other
oilseeds.
Oilseed meals supply more than one-half of the
high protein ingredients used in the domestic
manufacture of commercial livestock and poultry
feeds. Soybean meal is further processed into soy
flour and grits, used in both food and industrial
products, and into value-added soy protein
products. Textured vegetable protein (TVP R), a
soy protein product developed by the Company, is
sold primarily to the institutional food market
and, through others, to the food consumer market.
The Company also produces a wide range of other
edible soy protein products including isolated
soy protein, soy protein concentrate, soy-based
milk products, soy flours and vegetable patties
(Harvest Burgers R). The Company produces and
markets a wide range of consumer and
institutional health foods based on the Company's
various soy protein products. The Company
produces cottonseed flour which is sold primarily
to the pharmaceutical industry. Cotton cellulose
pulp is manufactured and sold to the chemical,
paper and filter markets.
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Item 1. BUSINESS--Continued
Corn Products
The Company is engaged in dry milling
and wet milling corn operations. Products
produced for use by the food and beverage
industry include syrup, starch, glucose,
dextrose, crystalline dextrose, high fructose
sweeteners, crystalline fructose and grits. Corn
gluten feed and distillers grains are produced
for use as feed ingredients. Ethyl alcohol is
produced to beverage grade or for industrial use
as ethanol. In gasoline, ethanol increases
octane, and is used as an extender and oxygenate.
Corn germ, a by-product of the milling process,
is further processed as an oilseed.
By fermentation of dextrose, the
Company produces citric and lactic acids, feed-
grade amino acids and vitamins, lactates,
sorbitol, monosodium glutamate, nematodes and
food emulsifiers principally for the food and
feed industries.
Wheat and Other Milled Products
Wheat flour is sold primarily to large
bakeries, durum flour is sold to pasta
manufacturers and bulgur, a gelatinized wheat
food, is sold to both the export and the domestic
food markets. The Company mills oats into oat
bran and oat flour for institutional and consumer
food customers. The Company also mills milo to
produce industrial flour that is used in the
manufacturing of wall board for the building
industry.
Other Products and Services
The Company buys, stores and cleans
agricultural commodities, such as oilseeds, corn,
wheat, milo, oats and barley, for resale to other
processors worldwide.
The Company produces and distributes
formula feeds and animal health and nutrition
products to the livestock, dairy and poultry
industries. Many of the feed ingredients and
health and nutrition products are produced in our
other commodity processing operations.
The Company produces bakery products
and mixes which are sold to the baking industry.
4
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Item 1. BUSINESS--Continued
The Company produces spaghetti,
noodles, macaroni, and other consumer food
products. The Company also produces lettuce,
other fresh vegetables and herbs in its
hydroponic greenhouse.
Malt products are produced for use by
the food and beverage industries.
The Company raises fish for
distribution to consumer food customers.
Hickory Point Bank and Trust Co. furnishes public
banking services, except commercial loans, as
well as cash management and securities
safekeeping services for the Company.
ADM Investor Services, Inc. is a registered
futures commission merchant and a clearing member
of all principal commodities exchanges. ADM
Securities Inc. is a securities broker-dealer
registered with the Securities and Exchange
Commission and a member of the National
Association of Securities Dealers, Inc.
Agrinational
Insurance Company, a Vermont subsidiary, acts as
a direct insurer and reinsurer of a portion of
the Company's domestic and foreign property and
casualty insurance risks.
Alfred C. Toepfer
International (Germany) and affiliates, of which
the Company has a 50% interest, is one of the
world's largest, most respected trading companies
specializing in processed agricultural products.
Toepfer has forty-one sales offices worldwide.
Compagnie
Industrielle et Financiere des Produits Amylaces
SA (Luxembourg) and affiliates, of which the
Company has a 41.5% interest, owns European
agricultural processing plants that are primarily
engaged in corn wet milling and wheat starch
production.
The Company, through its partnership
with Gold Kist, Inc. and Alimenta Processing
Corporation d/b/a Golden Peanut Company, is a
major supplier of peanuts to both the domestic
and export markets. These peanuts are used in
peanut butter, snacks, cereals and many other
foods.
The Company, through its partnership
with Ag Processing Inc. d/b/a Consolidated
Nutrition, is a supplier of premium animal feeds
and animal health products.
The Company, through its partnership with
Riceland Foods, Inc., is a processor of rice and
rice products for institutional and consumer food
customers.
Gruma S.A. de C.V. (Mexico) and affiliates, of
which the Company has a 22% interest, is the
world's largest producer and marketer of corn
flour and tortillas with operations in the U.S.,
Mexico and Central America. Additionally, the
Company has a 20% interest in the combined U.S.
corn flour operations of ADM and Gruma. The
Company also has a 40% share, through a joint
venture with Gruma, of two Mexican-based wheat
flour mills.
The Company owns a 48% interest in Heartland Rail
Corporation. Heartland's 81% owned affiliate,
Iowa Interstate Railroad, operates a regional
railroad in Iowa and Illinois.
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Item 1. BUSINESS--Continued
The Company participates in various joint
ventures that operate oilseed crushing
facilities, oil refineries and related storage
facilities in China and Indonesia.
The percentage of net sales and other operating
income by classes of products and services for
the last three fiscal years were as follows:
1996 1995 1994
________________________
Oilseed products 61% 60% 59%
Corn products 19 20 20
Wheat and other
milled products 12 11 12
Other products and services8 9 9
___ ___ ___
100% 100% 100%
=== === ===
Methods of Distribution
Since the Company's customers are principally
other manufacturers and processors, its products
are distributed mainly in bulk from processing
plants or storage facilities directly to the
customers' facilities. The Company owns a large
number of trucks and trailers and owns or leases
large numbers of railroad tank cars and hopper
cars to augment those provided by the railroads.
The Company uses the inland waterway system and
functions as a contract carrier of commodities
for its own operations as well as for other
companies. The Company owns and leases
approximately 2,000 river barges and 27 line-haul
towboats.
(ii) Status of new products
The Company continues to expand its business
through the development and production of new,
value-added products. From dextrose, the Company
is currently producing the feed-grade amino acids
lysine, threonine and tryptophan and food
additives citric acid, monosodium glutamate
(MSG), lactic acid, xanthan gum and sorbitol. The
Company has entered the vitamin market with the
production of riboflavin and vitamin E and is
currently expanding production facilities to
produce biotin and vitamin C. The Company
continues to develop its soy protein meat
substitutes, Harvest Burgers R and Harvest
Burgers R for Recipes TM and its soy protein
powdered non-dairy beverage, Nutribev R.
Additionally, the Company is developing and
expanding production facilities to produce
emulsifiers, distilled monoglycerides,
astaxanthan and isoflavones.
6
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Item 1. BUSINESS--Continued
(iii) Source and availability of raw materials
Substantially all of the Company's raw materials
are agricultural commodities. In any single
year, the availability and price of these
commodities are subject to wide fluctuations due
to unpredictable factors such as weather,
plantings, government (domestic and foreign)
farm programs and policies, changes in global
demand created by population growth and higher
standards of living and worldwide production of
similar and competitive crops.
(iv) Patents, trademarks and licenses
The Company owns several valuable patents,
trademarks and licenses but does not consider its
business dependent upon any single or group of
patents, trademarks and licenses.
(v) Extent to which business is seasonal
Since the Company is so widely diversified in
global agribusiness markets, there are no
material seasonal fluctuations in the
manufacture, sale and distribution of its
products and services. There is a degree of
seasonality in the growing season and procurement
of the Company's principal raw materials:
oilseeds, wheat, corn and other grains. However,
the actual physical movement of the millions of
bushels of these crops through the Company's
storage and processing facilities is reasonably
constant throughout the year. The worldwide need
for food is not seasonal and is ever expanding as
is the world's population.
(vi) Working capital items
Price variations and availability of grain at
harvest often cause wide fluctuations in the
Company's inventories and short-term borrowings.
(vii) Dependence on single customer
No material part of the Company's business is
dependent upon a single customer or very few
customers.
7
PAGE 8
Item 1. BUSINESS--Continued
(viii) Amount of backlog
Because of the nature of the Company's business,
the backlog of orders at year end is not a
significant indication of the Company's activity
for the current or upcoming year.
(ix) Business subject to renegotiation
The Company has no business with the government
that is subject to renegotiation.
(x) Competitive conditions
Markets for the Company's products are highly
price competitive and sensitive to product
substitution. No single company competes with
the Company in all of its markets; however, a
number of large companies compete in one or more
markets. Major competitors in one or more
markets include, but are not limited to, Cargill,
Inc., ConAgra, Inc., CPC International, Eridania
Beghin-Say and Tate & Lyle.
(xi) Research and development expenditures
Practically all of the Company's technical
efforts and expenditures are concerned with food
and feed ingredient products. Special efforts are
being made to find improvements in food
technology to alleviate the protein malnutrition
throughout the world, utilizing the three largest
United States crops-corn, soybeans and wheat.
The need to successfully market new or improved
food and feed ingredients developed in the
Company's research laboratories led to the
concept of technical support. The Company is
staffed with technical representatives who work
closely with customers and potential customers on
the development of food and feed products which
incorporate Company produced ingredients. These
technical representatives are an adjunct to both
the research and sales functions.
The Company maintains a research laboratory in
Decatur, Illinois where product and process
development activities are conducted. To develop
new bioproducts and to improve existing
bioproducts, new cultures are developed using
classical mutation and genetic engineering.
Protein research is conducted at facilities in
Decatur where meat and dairy pilot plants support
application research. Research to support sales
and development for bakery products is done at a
laboratory in Olathe, Kansas.
8
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Item 1. BUSINESS--Continued
The amounts spent during the three years ended
June 30, 1996, 1995 and 1994 for such technical
efforts were approximately $17.1, $16.5 and $20.1
million, respectively. In addition, the Company
maintains separate quality control departments
which are supervised by research personnel.
(xii)Material effects of capital expenditures for
environmental protection
During 1996, $25 million was spent for equipment,
facilities and programs for pollution control and
compliance with the requirements of various
environmental agencies.
There have been no material effects upon the
earnings and competitive position of the Company
resulting from compliance with federal, state and
local laws or regulations enacted or adopted
relating to the protection of the environment.
The Company expects that expenditures for
environmental facilities and programs will
continue at approximately the present rate with
no unusual amounts anticipated for the next two
years.
(xiii) Number of employees
The number of persons employed by the Company was
14,811 at June 30, 1996.
(d)Financial Information About Foreign and Domestic
Operations and Export Sales
The Company's foreign operations are principally
in developed countries and do not entail any undue
or unusual business risks. Geographic financial
information is set forth in "Note 10 of Notes to
Consolidated Financial Statements" of the annual
shareholders' report for the year ended June 30,
1996 and is incorporated herein by reference.
9
PAGE 10
Item 1. BUSINESS--Continued
Export sales by classes of products for the last
three fiscal years were as follows:
1996 1995 1994
________________________
Oilseed products 7% 8% 5%
Corn products 7 7 6
Wheat and other milled
products 1 1 1
Other products and services 1 - -
__ __ ___
16% 16% 12%
=== === ===
(e) Executive Officers
Name Title Age
Dwayne O. Andreas Chairman of the Board of 78
Directors from 1972.
Chief Executive Officer.
James R. Randall President from 1975. 71
G. Allen Andreas Vice President from 1988. 53
Counsel to the Executive
Committee from September 1994.
Michael D. Andreas Vice Chairman of the Board 47
of Directors from October 1992.
Executive Vice President
from 1988.
Martin L. Andreas Senior Vice President from 1988.57
Executive Assistant to the
Chief Executive.
Charles P. Archer Treasurer from October 1992. 41
Assistant Treasurer from 1988.
Charles T. Bayless Group Vice President from 61
January 1993. Vice President
from 1992. President of ADM
Processing Division since 1980.
10
PAGE 11
Item 1. Business--Continued
Howard E. Buoy Group Vice President from 69
January 1993. Vice President
of ADM Processing Division
from 1979.
William H. Camp Vice President from April 1993.47
Vice President of ADM Processing
Division from 1990 to 1993.
Barrie R. Cox Vice President from January 1996.
49
President of ADM Food Additives
Division from 1994. Vice
President of ADM Corn Processing
Division from 1990.
Larry H. Cunningham Vice President and President 52
of Protein Specialties
Division since July 1993.
Formerly President of
A. E. Staley Manufacturing Co.
Craig L. Hamlin Group Vice President from 50
October 1994. President of
ADM Milling from 1989.
Edward A. Harjehausen Vice President from October 45
1992. Vice President of
ADM Corn Processing Division
from 1988.
Burnell D Kraft Group Vice President from 65
January 1993. Vice President
from 1984. President of
ADM/Growmark, Collingwood
Grain and Tabor Grain Co.
subsidiaries.
Paul L. Krug, Jr. Vice President from 1991 and 52
President of ADM Investor
Services. Formerly a Vice
President of Continental Grain
Company.
John E. Long Vice President from July 1996. 67
President of ADM Research
Division from 1992. Various
senior research positions from 1975.
11
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Item 1. BUSINESS--Continued
Jack McDonald Vice President from October 1994.
64
President of Southern Cotton Oil
Division from 1990.
Steven R. Mills Controller from October 1994. 41
Various senior treasury and
accounting positions from 1979.
Paul B. Mulhollem Vice President from January 1996.
47
Managing Director of ADM
International, Ltd., from 1993.
International merchandising
positions since 1992. Formerly
Group President of Continental
Grain Company.
Brian F. Peterson Vice President from January 1996.
54
President of ADM BioProducts
Division from 1995. Various
merchandising positions from
1980.
Raymond V. Preiksaitis Vice President - Management 43
Information Systems from 1988.
John G. Reed Vice President from 1982. 66
Chief Executive-Europe from
September 1994.
Richard P. Reising Vice President, Secretary and 52
General Counsel from 1991.
Secretary and Assistant General
Counsel since 1988.
John D. Rice Vice President from 1993. 42
Vice President of ADM Processing
Division from 1992. Various
merchandising positions from
1988 to 1992.
Kenneth A. Robinson Vice President from January 1996.
49
Vice President of ADM Processing
Division from 1985.
Douglas J. Schmalz Vice President and Chief 50
Financial Officer from 1986.
Terrance S. Wilson Group Vice President from 58
January 1993. Officer of
ADM Corn Processing Division
since 1988.
Stephen H. Yu Vice President from January 1996.
36
Managing Director of ADM
Asia-Pacific, Ltd., from 1993.
Various merchandising positions
with Continental Grain Company
from 1986.
Officers of the registrant are elected by the Board
of Directors for terms of one year and until their
successors are duly elected and qualified.
Lowell W. Andreas and Dwayne O. Andreas, directors
of the registrant, are brothers. Michael D. Andreas
is the son of Dwayne O. Andreas. G. Allen Andreas
and Martin L. Andreas are nephews of Dwayne O.
Andreas and Lowell W. Andreas. Charles P. Archer is
the son of S. M. Archer, Jr., a director of the
registrant.
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Item 2. PROPERTIES
(a) Processing Facilities
The Company owns, leases, or has a 50% or greater
interest in the following processing plants:
United
States Foreign Total
______________________________________________
Owned 127 47 174
Leased 3 - 3
Joint Venture59 22 81
___ __ ___
189 69 258
=== == ===
The Company's operations are such that most products
are efficiently processed near the source of raw
materials. Consequently, the Company has many plants
located strategically in grain producing areas. The
annual volume processed will vary depending upon
availability of raw material and demand for the
finished products.
The Company operates thirty-three domestic and seven
foreign oilseed crushing plants with a daily processing
capacity of approximately 82,000 tons. The domestic
plants are located in Alabama, Arkansas, Georgia,
Illinois, Indiana, Iowa, Kansas, Louisiana, Minnesota,
Missouri, Mississippi, Nebraska, North Dakota, Ohio,
South Carolina, Tennessee and Texas. The foreign
plants are located in Canada, England, Germany and the
Netherlands.
The Company operates four wet corn milling and two dry
corn milling plants with a daily grind capacity of
approximately 1,600,000 bushels. These plants and other
related properties, including corn germ extraction and
corn gluten pellet plants, are located in Illinois,
Iowa, New York and North Dakota. The Company also has
interests, through joint ventures, in corn milling
plants in Mexico, Bulgaria, Hungary, Slovakia and
Turkey.
The Company operates twenty-nine domestic wheat and
durum flour mills, a domestic bulgur plant, six
Canadian flour mills and one flour mill each in Belize
and Barbados with a total daily capacity of
approximately 346,000 cwt. of flour. The Company also
operates three corn flour mills, two milo mills, two
pasta plants and two starch and gluten plants. These
plants and other related properties are strategically
located across North America in California, Illinois,
Indiana, Iowa, Kansas, Kentucky, Louisiana, Minnesota,
Missouri, Nebraska, New York, North Carolina, Oklahoma,
Oregon, Pennsylvania, Tennessee, Texas, Washington,
Wisconsin, Canada, Barbados and Belize. The Company
also has an interest, through a joint venture, in rice
milling plants in Arkansas and Louisiana.
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Item 2. PROPERTIES--Continued
The Company operates ten domestic oilseed refineries in
Illinois, Indiana, Iowa, Georgia, Nebraska, Tennessee
and Texas as well as seven foreign refineries in
England, Canada, Germany and the Netherlands. The
Company has an interest, through a joint venture, in an
oilseed refinery in Texas. The Company produces
packaged oils in Georgia, Illinois, California and
Germany and soy protein specialty products in Illinois
and the Netherlands. Lecithin products are produced in
Illinois, Iowa, Nebraska, Canada, Germany and the
Netherlands. Cotton linter pulp is produced in
Tennessee and cottonseed flour is produced in Texas.
The Company produces feed and food additives at eight
bioproduct plants located in Illinois, North Carolina
and Ireland. The Company also operates formula feed,
animal health and nutrition and pet food plants in
Georgia, Illinois, Iowa, Ohio, Texas, Washington,
Canada, England, Ireland, Barbados, Belize, China and
Puerto Rico. The Company also has interests, through
joint ventures, in formula feed and pet food plants in
Alabama, Arkansas, Georgia, Illinois, Iowa, Indiana,
Kansas, Michigan, Minnesota, Missouri, Nebraska, Ohio,
Pennsylvania, Tennessee, Vermont, Wisconsin, Canada,
Puerto Rico and Trinidad.
The Company operates five North American barley malting
plants located in Illinois, Minnesota, Wisconsin and
Canada.
The Company operates various other food ingredient
plants in Iowa, Kansas, Nebraska, Washington, Germany,
England and France.
(b) Procurement Facilities
The Company operates one hundred sixty-eight domestic
terminal, country and river elevators covering the
Midwest, West and South Central states, including one
hundred five country elevators and sixty-three terminal
and river loading facilities including three grain
export elevators in Louisiana. Elevators are located
in Colorado, Georgia, Illinois, Indiana, Iowa, Kansas,
Louisiana, Minnesota, Missouri, Montana, Nebraska,
North Carolina, Oklahoma, South Carolina, Tennessee and
Texas. Domestic grain terminals, elevators and
processing plants have an aggregate storage capacity of
approximately 372,000,000 bushels. The Company has an
interest, through a joint venture, in sixteen grain
terminals and elevators located in Illinois, Indiana,
Kentucky, Maryland, Michigan and Ohio. The Company also
operates twelve foreign grain elevators in Barbados,
Canada, Ireland and Germany. Thirteen cotton gins are
located in Texas and serve the cottonseed crushing
plants in that area.
14
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Item 3. LEGAL PROCEEDINGS
In 1993, the State of Illinois Environmental Protection
Agency brought administrative enforcement proceedings
arising out of the Company's failure to obtain permits
for certain pollution control equipment at certain of
the Company's processing facilities in Illinois. The
Company believes it has meritorious defenses. In
management's opinion these proceedings will not, either
individually or in the aggregate, have a material
adverse effect on the Company's financial condition or
results of operations.
The Company is involved in approximately 24
administrative and judicial proceedings in which it has
been identified as a potentially responsible party
(PRP) under the federal Superfund law and its state
analogs for the study and clean-up of sites
contaminated by material discharged into the
environment. In all of these matters, there are
numerous PRPs. Due to various factors such as the
required level of remediation and participation in the
clean-up effort by others, the Company's future clean-
up costs at these sites cannot be reasonably estimated.
However, in management's opinion these proceedings will
not, either individually or in the aggregate, have a
material adverse effect on the Company's financial
condition or results of operations.
The Company is the target of an investigation being
conducted by a grand jury in the Northern District of
Illinois into possible violations of federal antitrust
laws and related crimes in the food additives industry.
This investigation in Chicago is focused on antitrust
violations with respect to lysine. A federal grand
jury in San Francisco is investigating antitrust
violations with respect to citric acid and a federal
grand jury in Atlanta is investigating antitrust
violations with respect to high fructose corn syrup.
The Company and two of its executive officers - Michael
D. Andreas and Terrance S. Wilson - have been informed
that they are targets of the lysine investigation and
indictments are being considered against them.
Following public announcement in June 1995 of the
investigation, the Company and certain of its directors
and executive officers were named as defendants in at
least seventeen putative class action suits on behalf
of all purchasers of securities of the Company during
the period between certain dates in 1992 and 1995.
Fourteen of these suits were consolidated under the
name In Re Archer-Daniels-Midland Company Securities
Litigation, United States District Court, Northern
District of Illinois, Civil Action No. 95-C-3979, and a
consolidated complaint was filed on September 22, 1995.
The consolidated complaint alleges that the defendants
made material misrepresentations and omissions with
respect to the Company and its operations and with
respect to actions of the Company and its officers
regarding antitrust violations, as a result of which
market prices of the Company's securities were
artificially inflated during the putative class period.
The consolidated complaint alleges that the conduct
complained of violates federal securities laws. The
plaintiffs request unspecified compensatory damages,
costs (including attorneys and expert fees), expenses
and other unspecified relief on behalf of the putative
class. On October 31, 1995, the Court granted the
defendants' motion to transfer the consolidated action
to the Central District of Illinois (wherein it now
bears the caption E. M. Lawrence Limited Frozen
Retirement Trust Dated September 1, 1992, et al. v.
Archer-Daniels-Midland Co., et al., Case Number 95-
2287) where it was further consolidated with three
similar actions also pending in the Central District.
The Company and the
individual defendants have moved to dismiss this
consolidated complaint. On September 27, 1996 the
Company entered into an agreement with counsel for the
plaintiff class in which among other things, the
Company agreed to pay $30 million to members of the
class, without admitting the alleged violations of law.
Formal papers seeking court approval of the settlement
are expected to be filed soon.
15
PAGE 16
Item 3. LEGAL PROCEEDINGS--Continued
The Company, along with other companies, has been named
as a defendant in at least twenty-nine putative class
action antitrust suits involving the sale of high
fructose corn syrup. At least twenty-two of those
actions allege violations of federal antitrust laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of high fructose corn syrup, and seek
injunctions against continued alleged illegal conduct,
treble damages of an unspecified amount, attorneys fees
and costs, and other unspecified relief. The putative
classes in these cases comprise certain direct
purchasers of high fructose corn syrup during certain
periods in the 1990s. One such action was filed on July
21, 1995 in the United States District Court for the
Northern District of Alabama and is encaptioned Golden
Eagle, Inc. v. Archer-Daniels-Midland Co., et al.,
Civil Action No. 95-B-1888-J. This and other similar
actions have been transferred to the United States
District Court for the Central District of Illinois and
consolidated under the caption In Re High Fructose Corn
Syrup Antitrust Litigation, MDL No. 1087 and Master
File No. 95-1477. The Company, along with other
companies, also has been named as a defendant in at
least six putative class action antitrust suits filed
in California state court and at least one putative
class action antitrust suit filed in Alabama state
court involving the sale of high fructose corn syrup.
The California actions allege violations of the
California antitrust and unfair competition laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of high fructose corn syrup, and seek treble
damages of an unspecified amount, attorneys fees and
costs, restitution and other unspecified relief. Two of
the California putative classes comprise certain direct
purchasers of high fructose corn syrup in the State of
California during certain periods in the 1990s. One
such action was filed on October 17, 1995 in Superior
Court for the County of Stanislaus, California and
encaptioned St. Stan's Brewing Co. v Archer-Daniels-
Midland Co. et al., Civil Action No. 37237. The other
four California putative classes comprise certain
indirect purchasers of high fructose corn syrup in the
State of California during certain periods in the
1990s. One such action was filed on July 21, 1995 in
the Superior Court of the County of Los Angeles,
California and is encaptioned Borgeson v. Archer-
Daniels-Midland Co., et al., Civil Action No. BC131940.
The Alabama action alleges violations of the Alabama,
Michigan and Minnesota antitrust laws, including
allegations that defendants agreed to fix, stabilize
and maintain at artificially high levels the prices of
high fructose corn syrup, and seeks an injunction
against continued illegal conduct, damages of an
unspecified amount, attorneys fees and costs, and other
unspecified relief. The putative class in the Alabama
action comprises certain indirect purchasers in
Alabama, Michigan and
Minnesota during the period March 18, 1994 to March 18,
1996. This action was filed on March 18, 1996 in the
Circuit Court of Coosa
County, Alabama, and is encaptioned Caldwell v. Archer-
Daniels-Midland Co., et al., Civil Action No. 96-17.
16
PAGE 17
Item 3. LEGAL PROCEEDINGS--Continued
The Company was named as a defendant in at least
seventeen putative class action antitrust suits
involving the sale of lysine. Six of these actions
allege violations of federal antitrust laws, including
allegations that certain entities agreed to fix,
stabilize and maintain at artificially high levels the
price of lysine, and seek injunctions against continued
alleged illegal conduct, treble damages of an
unspecified amount, attorneys fees and costs, and other
unspecified relief. The putative classes in these cases
comprise certain direct purchasers of lysine for
certain periods in the 1990s. One such action was filed
on August 9, 1995 in the United States District for the
Northern District of Illinois and is encaptioned K&L
Feeds v. Archer-Daniels-Midland Co., Civil Action No.
95-C-4587. This and other similar actions have been
transferred to the United States District Court for the
Northern District of Illinois and consolidated as In Re
Amino Acid Lysine Antitrust Litigation, MDL No. 1083
and Master File No. 95-7679. On April 4, 1996, the
Company executed a settlement agreement with counsel
for the plaintiff class in which, among other things,
the Company agreed to pay $25 million to members of the
class, without admitting the alleged violations of law.
This settlement agreement has been approved by the
court and certain objectors to the settlement have
appealed the final order of approval to the United
States Court of Appeals for the Seventh Circuit. The
Company also has been named as a defendant in at least
one non-class action federal antitrust suit involving
the sale of lysine. This action was filed on November
13, 1995 in the United States District Court for the
Eastern District of Missouri and is encaptioned Purina
Mills, Inc., et al. v Archer-Daniels-Midland Co., Civil
Action No. 95-CV-2227. It alleges violations of federal
antitrust laws, including allegations that certain
entities agreed to fix, stabilize and maintain at
artificially high levels the price of lysine, and seeks
an injunction against continued alleged illegal
conduct, treble damages of an unspecified amount,
attorneys fees and costs, and other unspecified relief.
The Company also has been named as a defendant in at
least six putative class action antitrust suits filed
in California state court, at least two putative class
action antitrust suits filed in Alabama state court, at
least two putative class action antitrust suits filed
in Minnesota state court, at least one putative class
action antitrust suit filed in Georgia state court and
at least one putative class action antitrust suit filed
in Tennessee state court involving the sale of lysine.
The California actions allege violations of the
California antitrust and unfair competition laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of lysine, and
seek treble damages of an unspecified amount, attorneys
fees and costs, restitution and other unspecified
relief. The putative classes in the California actions
comprise certain indirect purchasers of lysine in the
State of California during certain periods in the
1990s. One such action was filed on September 29, 1995
in the Superior Court of the County of San Diego,
California, and is encaptioned Equine Competition
Products, Inc. v. Archer-Daniels-Midland Co., Civil
Action No. 693014. The Company has entered into an
agreement with counsel for the indirect purchasers
class in which among other things, the Company agreed
to pay $500,000 to members of the class, without
admitting the alleged violations of law. This
settlement received preliminary court approval on
September 20 and will be mailed to class members for a
final hearing on November 21, 1996. The Alabama actions
allege violations of the Alabama antitrust laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of lysine, and seek an injunction against
continued alleged illegal conduct, damages of an
unspecified amount, attorneys fees and costs, and other
unspecified relief. The putative classes in the Alabama
actions comprise certain indirect purchasers of lysine
in the State of Alabama during certain periods in the
1990s. One such action was filed on August 17, 1995 in
the Circuit Court of DeKalb County, Alabama, and is
encaptioned Ashley v. Archer-Daniels-Midland Co., et
al., Civil Action No. 95-336. One Minnesota action
alleges violations of the Minnesota, Tennessee,
Wisconsin, South Dakota, North Dakota, Kansas,
Louisiana, Michigan and Maine antitrust laws, including
allegations that defendants conspired to maintain the
price of lysine at artificially high levels, and seeks
treble damages of an unspecified amount, attorneys fees
and costs, and other unspecified relief. The putative
class in this action comprises certain indirect
purchasers in the aforementioned states of lysine
during the period June 1, 1992 through April 19, 1996.
This action was filed on April 10, 1996 in the District
Court for Renville County, Minnesota and is encaptioned
Big Valley Milling, Inc. v. Archer-Daniels-Midland Co.,
et al., No. C7-96-260. The other Minnesota action,
encaptioned, United Mills v. Archer-Daniels-Midland
Co., et al., No. 65-C2-96-215, and filed in the same
court, seeks identical relief on behalf of certain
indirect purchasers of lysine in all of the
aforementioned states except Tennessee. The Georgia
action, encaptioned Long v. Archer-Daniels-Midland Co.,
et al., Civil Action No. E-43829, and filed in Fulton
County Superior Court, alleges a restraint of trade in
violation of Georgia common law and the Georgia state
RICO act. This action includes allegations that the
defendants conspired to maintain the price of lysine at
artificially high levels and seeks an injunction
against continued illegal conduct, treble damages of an
unspecified amount, attorneys fees and costs, and other
unspecified relief. The putative class in the action
comprises certain indirect purchasers of lysine in the
state of Georgia during the period January 1, 1990
until the present. The Company has moved to dismiss
this action. The Tennessee action, encaptioned
McCormack Farms v. Archer Daniels Midland Co., et al.,
Civil Action No. 96C-2190, and filed in Davidson County
Circuit Court, alleges a restraint of trade in
violation of the Tennessee Trade Practices Act and
Tennessee Consumer Protection Act. This action includes
allegations that defendants conspired to fix, maintain
or stabilize the prices of lysine and seeks an
injunction against continued illegal conduct, treble
damages of an unspecified amount, attorneys' fees and
costs, and other unspecified relief. The putative class
in this case comprises certain indirect purchasers of
lysine within the State of Tennessee during the period
June 10, 1992 through June 10, 1996.
17
PAGE 18
Item 3. LEGAL PROCEEDINGS--Continued
The Company, along with other companies, has been named
as a defendant in at least nine putative class action
antitrust suits involving the sale of citric acid. Six
of these actions allege violations of federal antitrust
laws, including allegations that the defendants agreed
to fix, stabilize and maintain at artificially high
levels the prices of citric acid, and seek injunctions
against continued alleged illegal conduct, treble
damages of an unspecified amount, attorneys fees and
costs, and other unspecified relief. The putative
classes in these cases comprise certain direct
purchasers of citric acid for certain periods in the
1990s. One such action was filed on August 18, 1995, in
the United States District Court for the Northern
District of California, and is encaptioned 7-Up
Bottling Co. of Philadelphia, Inc. v. Archer-Daniels-
Midland Co., et al, Civil Action No. 95-2963. Other
similar actions have been transferred to this same
court and consolidated as In Re Citric Acid Antitrust
Litigation, MDL No. 1092, Master File No. C-95-2963FMS.
On September 27, 1996 the Company entered into an
agreement with counsel for the plaintiff class in which
among other things, the Company agreed to pay $35
million to members of the class, without admitting the
alleged violations of law. Formal papers seeking court
approval of the settlement are expected to be filed
soon. The Company, along with other companies, also has
been named as a defendant in at least one putative
class action antitrust suit filed in Alabama state
court involving the sale of citric acid. This action
alleges violations of the Alabama antitrust laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of citric acid, and seeks an injunction
against continued alleged illegal conduct, damages of
an unspecified amount, attorneys fees and costs, and
other unspecified relief. The putative class in the
Alabama action comprises certain indirect purchasers of
citric acid in the State of Alabama from July 1993
until July 1995. This action was filed on July 27, 1995
in the Circuit Court of Walker County, Alabama and is
encaptioned Seven Up Bottling Co. of Jasper, Inc. v.
Archer-Daniels-Midland Co., et al., Civil Action No. 95-
436. The Company has moved to dismiss this action.
The Company, along with other companies, also has been
named as a defendant in at least two putative class
action antitrust suits filed in California state court
involving the sale of citric acid. These actions allege
violations of the California antitrust and unfair
competition laws, including allegations that the
defendants conspired to fix, maintain or stabilize the
price of citric acid, and seek injunctions against
continued illegal conduct, treble damages of an
unspecified amount, attorneys fees and costs, and other
unspecified relief. The putative classes in these cases
comprise certain indirect purchasers of citric acid
within the State of California during certain periods
in the 1990s. One such action was filed on June 12,
1996 in the Superior Court of the County of Los
Angeles, California and is encaptioned Bianco v. Archer
Daniels Midland Co., et al., Civil Action No. 978912.
18
PAGE 19
Item 3. LEGAL PROCEEDINGS--Continued
The Company, along with other companies, has been named
as a defendant in at least six putative class action
antitrust suits involving the sale of both high
fructose corn syrup and citric acid. Two of these
actions allege violations of the California antitrust
and unfair competition laws, including allegations that
the defendants agreed to fix, stabilize and maintain at
artificially high levels the prices of high fructose
corn syrup and citric acid, and seek treble damages of
an unspecified amount, attorneys fees and costs,
restitution and other unspecified relief. The putative
class in one of these California cases comprises
certain direct purchasers of high fructose corn syrup
and citric acid in the State of California during the
period January 1, 1992 until at least October 1995.
This action was filed on October 11, 1995 in the
Superior Court of Stanislaus County, California and is
entitled Gangi Bros. Packing Co. v. Archer-Daniels-
Midland Co., et al., Civil Action No. 37217. The
putative class in the other California case comprises
certain indirect purchasers of high fructose corn syrup
and citric acid in the state of California during the
period October 12, 1991 until November 20, 1995. This
action was filed on November 20, 1995 in the Superior
Court of San Francisco County and is encaptioned MCFH,
Inc. v. Archer-Daniels-Midland Co., et al., Civil
Action No. 974120. The Company, along with other
companies, also has been named as a defendant in at
least one putative class action antitrust suit filed in
West Virginia state court involving the sale of high
fructose corn syrup and citric acid. This action
alleges violations of the West Virginia antitrust laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of high fructose corn syrup and citric acid,
and seeks treble damages of an unspecified amount,
attorneys fees and costs, and other unspecified relief.
The putative class in the West Virginia action
comprises certain entities within the State of West
Virginia that purchased products containing high
fructose corn syrup and/or citric acid for resale from
at least 1992 until 1994. This action was filed on
October 26, 1995, in the Circuit Court for Boone
County, West Virginia, and is encaptioned Freda's v.
Archer-Daniels-Midland Co., et al., Civil Action No. 95-
C-125. The Company, along with other companies, also
has been named as defendant in at least one putative
class action antitrust suit filed in Michigan state
court involving the sale of high fructose corn syrup
and citric acid. This action alleges violations of the
Michigan antitrust laws, including allegations that the
defendants agreed to fix, stabilize and maintain at
artificially high levels the prices of high fructose
corn syrup and citric acid, and seeks treble damages of
an unspecified amount, attorneys fees and costs, and
other unspecified relief. The putative class in the
Michigan action comprises certain persons within the
State of Michigan that purchased products containing
high fructose corn syrup and/or citric acid during the
period January 1992 through February 26, 1996. This
action was filed on February 26, 1996 in the Circuit
Court for Ingham County, Michigan, and is encaptioned
Wilcox v. Archer-Daniels-Midland Co., et al., Civil
Action No. 96-82473-CF. The Company, along with other
companies, also has been named as a
defendant in at least one putative class action
antitrust suit filed in the Superior Court for the
District of Columbia involving the sale of high
fructose corn syrup and citric acid. This action
alleges violations of the District of Columbia
antitrust laws, including allegations that the
defendants agreed to fix, stabilize and maintain at
artificially high levels the prices of high fructose
corn syrup and citric acid, and seeks treble damages of
an unspecified amount, attorneys fees and costs, and
other unspecified relief. The putative class in the
District of Columbia action comprises certain persons
within the District of Columbia that purchased products
containing high fructose corn syrup and/or citric acid
during the period January 1, 1992 through December 31,
1994. This action was filed on April 12, 1996 in the
Superior Court for the District of Columbia, and is
encaptioned Holder v. Archer-Daniels-Midland Co., et
al., Civil Action No. 96-2975. The Company, along with
other companies, has been named as a defendant in at
least one putative class action antitrust suit filed in
Kansas state court involving the sale of high fructose
corn syrup and citric acid. This action alleges
violations of the Kansas antitrust laws, including
allegations that the defendants agreed to fix,
stabilize and maintain at artificially high levels the
prices of high fructose corn syrup and citric acid, and
seeks treble damages of an unspecified amount, court
costs and other unspecified relief. The putative class
in the Kansas action comprises certain persons within
the State of Kansas that purchased products containing
high fructose corn syrup and/or citric acid during at
least the period January 1, 1992 through December 31,
1994. This action was filed on May 7, 1996 in the
District Court of Wyandotte County, Kansas and is
encaptioned Waugh v. Archer-Daniels-Midland Co., et
al., Case No. 96-C-2029.
19
PAGE 20
Item 3. LEGAL PROCEEDINGS--Continued
The Company, along with other companies, also has been
named as a defendant in at least six putative class
action antitrust suits filed in California state court
involving the sale of high fructose corn syrup, citric
acid and/or lysine. These actions allege violations of
the California antitrust and unfair competition laws,
including allegations that the defendants agreed to
fix, stabilize and maintain at artificially high levels
the prices of high fructose corn syrup, citric acid
and/or lysine, and seek treble damages of an
unspecified amount, attorneys fees and costs,
restitution and other unspecified relief. One of the
putative classes comprises certain direct purchasers of
high fructose corn syrup, citric acid and/or lysine in
the State of California during a certain period in the
1990s. This action was filed on December 18, 1995 in
the Superior Court for Stanislaus County, California
and is encaptioned Nu Laid Foods, Inc. v. Archer-
Daniels-Midland Co., et al., Civil Action No. 39693.
The other five putative classes comprise certain
indirect purchasers of high fructose corn syrup, citric
acid and/or lysine in the State of California during
certain periods in the 1990s. One such action was filed
on December 14, 1995 in the Superior Court for
Stanislaus County, California and is encaptioned Batson
v. Archer-Daniels-Midland Co., et al., Civil Action No.
39680.
Also following the public announcement of the grand
jury investigation in June 1995, three shareholder
derivative suits were filed against certain of the
Company's directors and executive officers and
nominally against the Company in the United States
District Court for the Northern District of Illinois
and at least fourteen similar shareholder derivative
suits were filed in the Delaware Court of Chancery. The
derivative suits filed in federal court in Illinois
were consolidated under the name Felzen, et al. v.
Andreas, et al., Civil Action No. 95-C-4006, 95-C-4535,
and a consolidated amended derivative complaint was
filed on September 29, 1995. This complaint names all
current directors of the Company (except Mr. Coan) and
one former director as defendants and names the Company
as a nominal defendant. It alleges breach of fiduciary
duty, waste of corporate assets, abuse of control and
gross mismanagement, based on the antitrust allegations
described above as well as other alleged wrongdoing. On
October 31, 1995, the Court granted the defendants'
motion to transfer the Illinois consolidated derivative
action to the Central District of Illinois, wherein it
now bears the case number 95-2279. On April 26, 1996,
the court dismissed the suit without prejudice and
permitted the plaintiffs twenty-one days to refile it.
The plaintiffs refiled the complaint on May 17, 1996.
The defendants again moved to dismiss the complaint on
June 7, 1996.
20
PAGE 21
Item 3. LEGAL PROCEEDINGS--Continued
The Company and its directors also have been named as
defendants in a putative class action suit encaptioned
Loudon v. Archer-Daniels-Midland Co., et al., Civil
Action No. 14638, filed in the Delaware Court of
Chancery on October 20, 1995. This action alleges
violations of Delaware state law and seeks invalidation
of the election of the Company's directors on the basis
of alleged omissions from the proxy statement issued by
the Company prior to its October 19, 1995 annual
meeting. The Court of Chancery dismissed this action on
February 20, 1996, and the case is now on appeal in the
Supreme Court of Delaware. The Company and its
directors also have been named as defendants in a
similar suit filed on November 1, 1995 in the United
States District Court for the Central District of
Illinois, and encaptioned Buckley v. Archer-Daniels-
Midland Co., et al., Civil Action No. 95-C-2269,
alleging violations of analogous provisions of federal
securities law. The defendants moved to dismiss this
action. The Court granted the motion to dismiss on June
6, 1996, and the case is now on appeal.
The Company and the individual defendants named in the
actions described above intend to vigorously defend
them unless they can be settled on terms deemed
acceptable to the parties.
The Company from time to time, in the ordinary course
of business, is named as a defendant in various other
lawsuits. In management's opinion, the gross liability
from such other lawsuits, including environmental
exposure, with or without insurance recoveries is not
considered to be material to the Company's financial
condition or results of operations.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II
Item 5.MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Information responsive to this Item is set forth in
"Common Stock Market Prices and Dividends" of the annual
shareholders' report for the year ended June 30, 1996
and is incorporated herein by reference.
Item 6. SELECTED FINANCIAL DATA
Information responsive to this Item is set forth in the
"Ten-Year Summary of Operating, Financial and Other
Data" of the annual shareholders' report for the year
ended June 30, 1996 and is incorporated herein by
reference.
21
PAGE 22
Item 7.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Information responsive to this Item is set forth in
"Management's Discussion of Operations and Financial
Condition" of the annual shareholders' report for the
year ended June 30, 1996 and is incorporated herein by
reference.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The following financial statements and supplementary
data included in the annual shareholders' report for the
year ended June 30, 1996 are incorporated herein by
reference:
Consolidated balance sheets--June 30, 1996 and 1995
Consolidated statements of earnings--Years ended
June 30, 1996, 1995 and 1994
Consolidated statements of shareholders' equity--Years
ended
June 30, 1996, 1995 and 1994
Consolidated statements of cash flows--Years ended
June 30, 1996, 1995 and 1994
Notes to consolidated financial statements--June 30, 1996
Summary of Significant Accounting Policies
Report of Independent Auditors
Quarterly Financial Data (Unaudited)
Recent Developments:
See Item 3 of this Form 10-K report for an update of
recent developments related to the antitrust
investigation and related litigation including the
Company's agreement to settle a consolidated securities
class action lawsuit for $30 million and a class action
lawsuit involving the sale of citric acid for $35
million.
Item 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information with respect to directors and executive
officers is set forth in "Election of Directors" and
"Rule 405 Disclosure" of the definitive proxy statement
for 1996 and is incorporated herein by reference.
Certain information with respect to executive officers
is included in Item 1 (e) of this report.
Item 11. EXECUTIVE COMPENSATION
Information responsive to this Item is set forth
in "Executive Compensation" and "Salary and Stock
Option Committee's Report" of the definitive
proxy statement for 1996 and is incorporated
herein by reference.
22
PAGE 23
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
Information responsive to this Item is set forth in
"Principal Holders of Voting Securities" of the
definitive proxy statement for 1996 and is incorporated
herein by reference.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information responsive to this Item is set forth in
"Certain Relationships and Related Transactions" of the
definitive proxy statement for 1996 and is incorporated
herein by reference.
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a)(1) The following consolidated financial
statements and other financial data of the
registrant and its subsidiaries, included in the
annual report of the registrant to its
shareholders for the year ended June 30, 1996, are
incorporated by reference in Item 8, and are also
incorporated herein by reference:
Consolidated balance sheets--June 30, 1996 and 1995
Consolidated statements of earnings--Years ended
June 30, 1996, 1995 and 1994
Consolidated statements of shareholders' equity--
Years ended June 30, 1996, 1995 and 1994
Consolidated statements of cash flows--Years ended
June 30, 1996, 1995 and 1994
Notes to consolidated financial statements--June
30,
1996
Summary of Significant Accounting Policies
Quarterly Financial Data (Unaudited)
(a)(2) Schedules are not applicable and
therefore not included in this report.
Financial statements of affiliates accounted
for by the equity method have been omitted because
they do not, considered individually, constitute
significant subsidiaries.
(a)(3) LIST OF EXHIBITS
(3)Composite Certificate of Incorporation and
Bylaws filed on November 7, 1986 as Exhibits 3(a)
and 3(b), respectively, to Post Effective
Amendment No. 1 to Registration Statement on Form
S-3, Registration No. 33-6721, are incorporated
herein by reference.
23
PAGE 24
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
--Continued
(4)Instruments defining the rights of security
holders, including:
(i) Indenture dated May 15,
1981, between the registrant and Morgan
Guaranty Trust Company of New York, as
Trustee (incorporated by reference to
Exhibit 4(b) to Amendment No. 1 to
Registration Statement No. 2-71862),
relating to the $250,000,000 - 7% Debentures
due May 15, 2011;
(ii) Indenture dated May 1,
1982, between the registrant and Morgan
Guaranty Trust Company of New York, as
Trustee (incorporated by reference to
Exhibit 4(c) to Registration Statement No. 2-
77368), relating to the $400,000,000 Zero
Coupon Debentures due May 1, 2002;
(iii) Indenture dated as
of March 1, 1984 between the registrant and
Chemical Bank, as Trustee (incorporated by
reference to Exhibit 4 to the registrant's
Current Report on Form 8-K dated August 3,
1984 (File No. 1-44)), as supplemented by
the Supplemental Indenture dated as of
January 9, 1986, between the registrant and
Chemical Bank, as Trustee (incorporated by
reference to Exhibit 4 to the registrant's
Current Report on Form 8-K dated January 9,
1986 (File No. 1-44)), relating to the
$100,000,000 - 10 1/4% Debentures due
January 15, 2006;
(iv) Indenture dated June 1,
1986 between the registrant and Chemical
Bank, (as successor to Manufacturers Hanover
Trust Company), as Trustee (incorporated by
reference to Exhibit 4(a) to Registration
Statement No. 33-6721), and Supplemental
Indenture dated as of August 1, 1989 between
the registrant and Chemical Bank (as
successor to Manufacturers Hanover Trust
Company), as Trustee (incorporated by
reference to Exhibit 4(c) to Post-Effective
Amendment No. 3 to Registration Statement
No. 33-6721), relating to the $300,000,000
- 8 7/8% Debentures due April 15, 2011, the
$300,000,000 - 8 3/8% Debentures due April
15, 2017, the $300,000,000 - 8 1/8%
Debentures due June 1, 2012, the
$250,000,000 - 6 1/4% Notes due May 15,
2003, and the $250,000,000 - 7 1/8%
Debentures due March 1, 2013.
24
PAGE 25
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
--Continued
Copies of constituent
instruments defining rights of holders of
long-term debt of the Company and
Subsidiaries, other than the Indentures
specified herein, are not filed herewith,
pursuant to Instruction (b)(4) (iii)(A) to
Item 601 of Regulation S-K, because the
total amount of securities authorized under
any such instrument does not exceed 10% of
the total assets of the Company and
Subsidiaries on a consolidated basis. The
registrant hereby agrees that it will, upon
request by the Commission, furnish to the
Commission a copy of each such instrument.
(10) Material Contracts--Copies of the
Company's stock option plans and its savings and
investment plans, pursuant to Instruction
(10)(iii)(A) to Item 601 of Regulation S-K, are
incorporated herein by reference as follows:
(i) Registration Statement
No. 2-91811 on Form S-8 dated June 22, 1984
(definitive Prospectus dated July 16, 1984)
relating to the Archer Daniels Midland 1982
Incentive Stock Option Plan.
(ii) Registration Statement
No. 33-49409 on Form S-8 dated March 15,
1993 relating to the Archer Daniels Midland
1991 Incentive Stock Option Plan and Archer
Daniels Midland Company Savings and
Investment Plan.
(iii) Registration
Statement No. 33-58387 on Form S-8 dated
April 3, 1995 relating to the ADM Savings
and Investment Plan for Salaried Employees
and the ADM Savings and Investment Plan for
Hourly Employees.
(13) Portions of annual report to
shareholders incorporated by reference
(21) Subsidiaries of the registrant
(23) Consent of independent auditors
(24) Powers of attorney
(27) Financial Data Schedule
(b) Reports on Form 8-K
A Form 8-K was filed on April 16, 1996 to
report information pertaining to the Company's
participation in an agreement to settle the
federal class action lawsuits filed against
several companies involving the sale of lysine.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: September 30, 1996
ARCHER-DANIELS-MIDLAND COMPANY
/s/ R. P. Reising
R. P. Reising
Vice President, Secretary
and General Counsel
/s/ D. J. Schmalz
D. J. Schmalz
Vice President and
Chief Financial Officer
/s/ S. R. Mills
S. R. Mills
Controller
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below on September 30, 1996,
by the following persons on behalf of the Registrant and in
the capacities indicated.
D. O. Andreas*, Chairman of the Board, Chief Executive and
Director
(Principal Executive Officer)
L. W. Andreas*, Director
M. D. Andreas*, Director
M. L. Andreas*, Director
Ralph Bruce*, Director
G. O. Coan*, Director
J. H. Daniels*, Director
R. A. Goldberg*, Director
F. R. Johnson*, Director
J. R. Randall*, Director
Mrs. N. A. Rockefeller*, Director
R. S. Strauss*, Director
J. K. Vanier*, Director
O. G. Webb*, Director
D. J. Smith
Attorney-in-Fact
*Powers of Attorney authorizing R. P. Reising, D. J. Schmalz and
D. J. Smith and each of them, to sign the Form 10-K on behalf of
the above-named officers and directors of the Company are being
filed with the Securities and Exchange Commission.
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